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Yield or Performance? CSTIX Has Provided Both YTD

Anna Narem
VP, Director of Product Management

Elise Pondel
AVP, Director of Product Analytics

In this current market environment, Calamos Short-Term Bond Fund (CSTIX) can provide the following to a portfolio:

  • Maintain ballast
  • Reduce duration risk
  • Increase yield

As the volatility continues on news of high inflation, Fed policy, and uncertain economic outlook, investment professionals continue to look for investments that will reduce risk in tough markets while still delivering yield. Below we highlight the current opportunity in short-term debt and how CSTIX has worked to provide high current income this year with less sensitivity to rising rates.

Attractive Yields on Short-term Bonds

As our team illustrated earlier this year, a flatter or inverted yield curve makes short duration investments especially attractive, providing investors the opportunity to reduce interest rate risk without giving up yield. We are currently in that environment. The below chart highlights the change in the yield curve we’ve seen this year relative to the yield curve at the end of 2021.

higher and flatter daily treasury yield curve in 2022

Resiliency in Rising Rate Environments

CSTIX has been less sensitive to moves in rates relative to peers in the Morningstar Short-Term Bond category and other intermediate-term bond product, as shown in the review below of four past periods when the 10-year treasury increased at least 50 bps.

CSTIX's performance in a rising rate environment

Don’t Sacrifice Yield or Performance

With equity and fixed income asset classes experiencing double-digit declines, there are few places to hide in this market. CSTIX has outperformed its average peer in its category, as well as most other fixed income Morningstar categories YTD through September 30. Over the same period, the fund produced a higher yield with lower duration than peers.

CSTIX has outperformed vs peers while providing higher yield, lower duration

Whether moving cash off the sidelines, pulling from duration or replacing fixed income alternatives, CSTIX offers a unique opportunity to reduce risk in a rising rate environment and provide investors with a high level of current income.

For more information about CSTIX, contact your Calamos Investment Consultant at 800-582-6959 or

Before investing carefully consider the fund’s investment objectives, risks, charges and expenses. Please see the prospectus and summary prospectus containing this and other information which can be obtained by calling 1-800-582-6959. Read it carefully before investing.

Calamos Short-Term Bond Fund average annual returns and expense ratio

Opinions and estimates offered constitute our judgment and are subject to change without notice, as are statements of financial market trends, which are based on current market conditions. We believe the information provided here is reliable, but do not warrant its accuracy or completeness. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The views and strategies described may not be suitable for all investors. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, accounting, legal or tax advice. References to future returns are not promises or even estimates of actual returns a client portfolio may achieve. Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation. References to specific securities, asset classes and financial markets are for illustrative purposes only and are not intended to be, and should not be interpreted as, recommendations.

An investment in the Fund(s) is subject to risks, and you could lose money on your investment in the Fund(s). There can be no assurance that the Fund(s) will achieve its investment objective. Your investment in the Fund(s) is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other government agency. The risks associated with an investment in the Fund(s) can increase during times of significant market volatility. The Fund(s) also has specific principal risks, which are described below. More detailed information regarding these risks can be found in the Fund's prospectus.

The principal risks of investing in the Calamos Short-Term Bond Fund include: interest rate risk consisting of loss of value for income securities as interest rates rise, credit risk consisting of the risk of the borrower to miss payments, high yield risk, liquidity risk, mortgage-related and other asset-back securities risk, including extension risk and prepayment risk, US Government security risk, foreign securities risk, non-US Government obligation risk and portfolio selection risk. As a result of political or economic instability in foreign countries, there can be special risks associated with investing in foreign securities, including fluctuations in currency exchange rates, increased price volatility and difficulty obtaining information. In addition, emerging markets may present additional risk due to potential for greater economic and political instability in less developed countries.

Morningstar Short-Term Bond Category funds invest primarily in corporate and other investment-grade US fixed-income issues and typically have durations of 1.0 to 3.5 years. Short-term is defined as 25% to 75% of the three-year average effective duration of the MCBI.

S&P 500 Index is generally considered representative of the US stock market.

Bloomberg US Aggregate Bond Index is a broad-based flagship benchmark that measures the investment grade, US dollar-denominated, fixed-rate taxable bond market. The index includes Treasuries, government related and corporate securities, MBS (agency fixed-rate and hybrid ARM pass-throughs), ABS and CMBS (agency and non-agency).

The Bloomberg US Government/Credit 1-3 Years Index includes all medium and larger issues of US government, investment-grade corporate, and investment grade international dollar-denominated bonds that have maturities of between 1 and 3 years and are publicly issued.

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