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Calamos Investment Team Outlooks, July 2023

Introduction from John P. Calamos, Sr., Founder, Chairman and Global Chief Investment Officer

During the second quarter, the economy continued to tread a path of “better than feared, but far from strong.” US economic data remained steady, but not spectacular. The labor market stayed strong and financial conditions continued to be quite easy despite the best efforts of central bankers around the world. A debt ceiling crisis was averted, and the systematic bank failure that many people feared in the wake of the Silicon Valley Bank collapse did not come to pass. Inflation data moderated and market participants grew more confident that the Federal Reserve was largely done with its current tightening cycle.

During the quarter, the market-cap weighted S&P 500 Index gained 8.7%, crossing into bull market territory from the lows of 2022. However, the rally was remarkable for its narrowness—a handful of mega-cap names with a strong emphasis on technology drove the gains of the index. Meanwhile, most other stocks in the S&P 500 posted more modest returns, as measured by the Equal Weight Index’s advance of 4.0%. Convertible securities continued to tally up gains, and small caps found their footing, with the Russell 2000 Index advancing a brisk 5.2%. Global benchmarks also advanced, but at a more moderate pace than in the first quarter.

Global Asset Class Returns, 2Q 2023

Past performance is no guarantee of future results. Source: Morningstar. Data as of 6/30/23 for the Refinitiv Global Convertible Bond Index, the most recent available.

The quarter will also be remembered—likely for decades to come—for the mass adoption of the first AI “killer app” Chat GPT. AI dominated earnings calls as the mainstream media focused on little else. Our teams are getting many questions about if and how AI will reshape the world. Certainly, AI offers tremendous potential to drive productivity enhancements and additional innovations across all sectors of the economy—far beyond larger cap tech names. As our teams discuss in their commentaries, they are carefully analyzing the different opportunities they see within their asset classes.

Looking to the second half of the year, we believe the US can continue on a growth path, albeit at a slowing pace. Although inflation is moderating, we’re not out of the woods, and fiscal policy uncertainty will only increase as the US presidential election grows nearer. Fed policy has become less of a focal point of investor anxiety, but only time will tell how successful the central bank has been in taming inflation and draining the unprecedented liquidity it pumped into the economy over the years. Other wildcards include how economic growth in China unfolds and geopolitical conflicts.

We expect that the extraordinarily narrow equity markets will broaden their leadership, with growth-oriented quality companies having the edge. In the fixed income markets, we’re seeing more variation in credit fundamentals.

We believe the Calamos funds are well positioned. Across asset classes, attention to fundamentals, individual security selection and risk management will be paramount for navigating higher short-term rates and a moderating economic recovery. It will also be essential to understand the thematic drivers that are disrupting the status quo and creating new winners or losers. Of course, AI is the first that likely comes to mind, but it is not the only one, as you’ll see in our team’s commentaries.

In this environment, we encourage investors to maintain well-diversified asset allocations. Given our expectation that equity markets will broaden, there are opportunities across the capitalization spectrum, supporting the case for multi-cap approaches and small caps. As you’ll read in our investment team commentaries, there are also many reasons to be excited about non-US markets, including a number of emerging economies.

Given our expectation of continued market volatility, we see tailwinds for convertible securities, which combine equity and fixed income characteristics. Through active management, convertibles can offer benefits that stocks and bonds alone cannot by providing participation in equity upside with downside risk mitigation. Within traditional fixed income, our teams are continuing to identify opportunities on a bond-by-bond basis.

The case is as strong as ever for including alternatives within both equity and fixed income allocations. One area that we’re particularly excited about is private credit, which may offer attractive yield and total return potential with less correlation to traditional fixed income investments. We’re pleased to be able to provide investors with access to a broad spectrum of private credit opportunities through our partnership with Aksia, a leader in the asset class. I invite you to visit our private credit capabilities page to learn more.

Below, our teams share their views on what they see on the horizon, where they are finding opportunity and how they are managing risks.

The Easy Part of 2023 Is Behind Us
Calamos Phineus Long/Short Fund (CPLIX)
Michael Grant

Capitalizing on Rising Interest Rates and a Slow Grind Up in the S&P 500 Index
Calamos Market Neutral Income Fund (CMNIX), Calamos Hedged Equity Fund (CIHEX)
Eli Pars, CFA

Favorable Tailwinds for Convertible Securities
Calamos Convertible Fund (CICVX)
Jon Vacko, CFA and Joe Wysocki, CFA

Global Convertibles: Staying Focused on Fundamentals Amid Signs of Economic Slowdown
Calamos Global Convertible Fund (CXGCX)
Eli Pars, CFA

In a Multispeed Economy, improving ROIC Guides the Way
Calamos Growth and Income Fund (CGIIX)
John Hillenbrand, CPA

Growth Stocks: Attractive Prospects in 2H 2023 but Selectivity is Key
Calamos Growth Fund (CGRIX)
Matt Freud, CFA, and Michael Kassab, CFA

When Stocks Have Rallied off Bear Market Lows, Small Caps Have Stood to Gain
Calamos Timpani Small Cap Growth Fund (CTSIX), Calamos Timpani SMID Growth Fund (CTIGX)
Brandon Nelson, CFA

Japan, Global AI and an Uneven Covid Reopening
Calamos Global and International Suite (CNWIX, CGCIX, CIGEX, CIGIX, CSGIX)
Nick Niziolek, CFA, Dennis Cogan, CFA, Paul Ryndak, CFA and Kyle Ruge, CFA

Narrow Market Likely to Broaden to Quality Stocks Across Sectors
Calamos Antetokounmpo Sustainable Equities Fund (SROIX)
Jim Madden, CFA, Tony Tursich, CFA and Beth Williamson

Fixed Income Update: Credit Market Fundamentals Call for Active Risk Management
Fixed Income Suite (CIHYX, CTRIX, CSTIX)
Matt Freund, CFA, Christian Brobst, and Chuck Carmody, CFA



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 1-866-363-9219. Read it carefully before investing.

Diversification and asset allocation do not guarantee a profit or protect against a loss. Alternative strategies entail added risks and may not be appropriate for all investors. Indexes are unmanaged, not available for direct investment and do not include fees and expenses.

Opinions, estimates, forecasts, and statements of financial market trends that are based on current market conditions constitute our judgment and are subject to change without notice. The views and strategies described may not be appropriate for all investors. 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.

Important Risk Information. 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.

Foreign security risk (all funds excluding Calamos Hedged Equity Fund, Calamos Total Return Bond Fund, and Calamos Growth and Income Fund): 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.

The principal risks of investing in the Calamos Market Neutral Income Fund include: equity securities risk consisting of market prices declining in general, convertible securities risk consisting of the potential for a decline in value during periods of rising interest rates and the risk of the borrower to miss payments, synthetic convertible instruments risk, convertible hedging risk, covered call writing risk, options risk, short sale risk, interest rate risk, credit risk, high yield risk, liquidity risk, portfolio selection risk, and portfolio turnover risk.

The principal risks of investing the Calamos Hedged Equity Fund include: covered call writing risk, options risk (see definition below), equity securities risk, correlation risk, mid-sized company risk, interest rate risk, credit risk, liquidity risk, portfolio turnover risk, portfolio selection risk, foreign securities risk, American depository receipts, and REITs risks.

Options Risk—the Fund’s ability to close out its position as a purchaser or seller of an over-the-counter or exchange-listed put or call option is dependent, in part, upon the liquidity of the options market. There are significant differences between the securities and options markets that could result in an imperfect correlation among these markets, causing a given transaction not to achieve its objectives. The Fund’s ability to utilize options successfully will depend on the ability of the Fund’s investment advisor to predict pertinent market movements, which cannot be assured.

The principal risks of investing in the Calamos Phineus Long/Short Fund include: equity securities risk consisting of market prices declining in general, short sale risk consisting of potential for unlimited losses, foreign securities risk, currency risk, geographic concentration risk, other investment companies (including ETFs) risk, derivatives risk, Alternative investments may not be suitable for all investors. The fund takes long positions in companies that are expected to outperform the equity markets, while taking short positions in companies that are expected to underperform the equity markets and for hedging purposes. The fund may lose money should the securities the fund is long decline in value or if the securities the fund has shorted increase in value, but the ultimate goal is to realize returns in both rising and falling equity markets while providing a degree of insulation from increased market volatility.

The principal risks of investing in the Calamos Convertible Fund include a potential decline in the value of convertible securities during periods of rising interest rates and the possibility of the borrower missing payments. The credit standing of the issuer and other factors may also affect a convertible security’s investment value. Synthetic convertible instruments may fluctuate and perform inconsistently with an actual convertible security, and components of a synthetic convertible can expire worthless. The Fund may also be subject to foreign securities risk, equity securities risk, credit risk, high yield risk, portfolio selection risk and liquidity risk.

The principal risks of investing in the Calamos Global Convertible Fund include: equity securities risk consisting of market prices declining in general, growth stock risk consisting of potential increased volatility due to securities trading at higher multiples, foreign securities risk, emerging markets risk, currency risk, geographic concentration risk, American depository receipts, midsize company risk, small company risk, portfolio turnover risk and portfolio selection risk.

The principal risks of investing in the Calamos Timpani Small Cap Growth Fund include: equity securities risk consisting of market prices declining in general, growth stock risk consisting of potential increased volatility due to securities trading at higher multiples, and portfolio selection risk. The Fund invests in small capitalization companies, which are often more volatile and less liquid than investments in larger companies.

The principal risks of investing in the Calamos Timpani SMID Growth Fund include: equity securities risk consisting of market prices declining in general, growth stock risk consisting of potential increased volatility due to securities trading at higher multiples, and portfolio selection risk. The Fund invests in small and mid capitalization companies, which are often more volatile and less liquid than investments in larger companies.

The principal risks of investing in the Calamos Growth Fund include: equity securities risk consisting of market prices declining in general, growth stock risk consisting of potential increased volatility due to securities trading at higher multiples, mid-sized company risk, foreign securities risk and portfolio selection risk.

The principal risks of investing in the Calamos Growth and Income Fund include the potential for convertible securities to decline in value during periods of rising interest rates and the possibility of the borrower missing payments; synthetic convertible instruments risks include fluctuations inconsistent with a convertible security and components expiring worthless. Others include equity securities risk, growth stock risk, small and midsize company risk, interest rate risk, credit risk, liquidity risk, high yield risk, forward foreign currency contract risk, and portfolio selection risk.

The principal risks of investing in the Calamos International Growth Fund include: equity securities risk consisting of market prices declining in general, growth stock risk consisting of potential increased volatility due to securities trading at higher multiples, foreign securities risk, emerging markets risk, small and mid-sized company risk and portfolio selection risk.

The principal risks of investing in the Calamos Evolving World Growth Fund include: equity securities risk consisting of market prices declining in general, growth stock risk consisting of potential increased volatility due to securities trading at higher multiples, foreign securities risk, emerging markets risk, convertible securities risk consisting of the potential for a decline in value during periods of rising interest rates and the risk of the borrower to miss payments, and portfolio selection risk.

The principal risks of investing in the Calamos Global Equity Fund include: equity securities risk consisting of market prices declining in general, growth stock risk consisting of potential increased volatility due to securities trading at higher multiples, value stock risk, foreign securities risk, forward foreign currency contract risk, emerging markets risk, small and mid-sized company risk and portfolio selection risk.

The principal risks of investing in the Calamos Global Opportunities Fund include: convertible securities risk consisting of the potential for a decline in value during periods of rising interest rates and the risk of the borrower to miss payments, synthetic convertible instruments risk consisting of fluctuations inconsistent with a convertible security and the risk of components expiring worthless, foreign securities risk, emerging markets risk, equity securities risk, growth stock risk, interest rate risk, credit risk, high yield risk, forward foreign currency contract risk, portfolio selection risk, and liquidity risk.

The principal risks of investing in the Calamos International Small Cap Growth Fund include: equity securities risk consisting of market prices declining in general, growth stock risk consisting of potential increased volatility due to securities trading at higher multiples, foreign securities risk, emerging markets risk, small and mid-sized company risk and portfolio selection risk. The Fund invests in small capitalization companies, which are often more volatile and less liquid than investments in larger companies.

The principal risks of investing the Calamos Total Return 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 missing payments, high yield risk, liquidity risk, mortgage-related and other asset-backed securities risk, including extension risk and portfolio selection risk.

The principal risks of investing in the Calamos High Income Opportunities Fund include: high yield risk consisting of increased credit and liquidity risks, convertible securities risk consisting of the potential for a decline in value during periods of rising interest rates and the risk of the borrower to miss payments, synthetic convertible instruments risk, interest rate risk, credit risk, liquidity risk, portfolio selection risk and foreign securities risk. The Fund’s fixed income securities are subject to interest rate risk. If rates increase, the value of the Fund’s investments generally declines. Owning a bond fund is not the same as directly owning fixed income securities. If the market moves, losses will occur instantaneously, and there will be no ability to hold a bond to maturity.

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.

The principal risks of investing in the Calamos Antetokounmpo Sustainable Equities Fund include: equity securities risk consisting of market prices declining in general, growth stock risk consisting of potential increased volatility due to securities trading at higher multiples, large-capitalization stocks as a group could fall out of favor with the market, small and mid-sized company risk, sector risk, portfolio turnover risk, and portfolio selection risk.

The Fund’s ESG policy could cause it to perform differently compared to similar funds that do not have such a policy. The application of the social and environmental standards of Calamos Advisors may affect the Fund’s exposure to certain issuers, industries, sectors, and factors that may impact the relative financial performance of the Fund-positively or negatively-depending on whether such investments are in or out of favor.

Calamos Antetokounmpo Asset Management LLC (“CGAM”), an investment adviser registered with the SEC under the Investment Advisers Act of 1940, serves as the Fund’s adviser (“Adviser”). CGAM is jointly owned by Calamos Advisors LLC and Original C Fund, LLC, an entity whose voting rights are wholly owned by Original PE, LLC which, in turn, is wholly owned by Giannis Sina Ugo Antetokounmpo.

Mr. Antetokounmpo serves on the Adviser’s Board of Directors and has indirect control of half of the Adviser’s Board.

Mr. Antetokounmpo is not a portfolio manager of the Fund and will not be involved in the day-to-day management of the Fund’s investments, and neither Original C nor Mr. Antetokounmpo shall provide any “investment advice” to the Fund. Mr. Antetokounmpo provided input in selecting the initial strategy for the Fund.

Mr. Antetokounmpo will be involved with marketing efforts on behalf of the Adviser.

If Mr. Antetokounmpo is no longer involved with the Fund or the Adviser then “Antetokounmpo” will be removed from the name of the Fund and the Adviser. Further, shareholders would be notified of any change in the name of the Fund or its strategy.

Indexes are unmanaged, do not include fees or expenses and are not available for direct investment. The US Dollar Index measures the value of the US dollar relative to a basket of foreign currencies, including Euro Area, Canada, Japan, United Kingdom, Switzerland, Australia, and Sweden. The S&P 500 Index is considered generally representative of the US equity market and is market cap weighted. The MSCI All Country World Index represents the performance of global equities. The MSCI All Country World ex USA Index represents the performance of global equities, excluding the US. The MSCI Emerging Markets Index is a measure of the performance of emerging market equities. The ICE BofA US High Yield Index is an unmanaged index of US high yield debt securities. The ICE BofA All US Convertible Index (VXA0) is a measure of the US convertible market. The Refinitiv Global Convertible Bond Index measures the performance of the global convertible market Oil is represented by current pipeline export quality Brent blend. The Bloomberg US Aggregate Bond Index is a broad based benchmarks of the US investment grade and global investment grade bond market, respectively. They include Treasury, government related, corporate and securitized fixed-rate bonds. The Russell 2000 Index is a measure of US small cap performance. The Russell 1000 Index is a measure of US large cap performance. The Russell 3000 Index measures the performance of 3,000 publicly held US companies based on total market capitalization, which represents approximately 98% of the investable US equity market. The Russell 3000 Growth Index is representative of those Russell 3000 Index companies with higher price-to-book ratios and higher forecasted growth values. The Russell 3000 Value Index is representative of those Russell 3000 Index companies with lower price-to-book ratios and lower forecasted growth values. The MSCI Japan Index is designed to measure the performance of the large and mid cap segments of the Japanese market.

ICE Data: Source ICE Data Indices, LLC, used with permission. ICE permits use of the ICE BofA indices and related data on an `as is’ basis, makes no warranties regarding same, does not guarantee the suitability, quality, accuracy, timeliness, and/or completeness of the ICE BofA Indices or data included in, related to, or derived therefrom, assumes no liability in connection with the use of the foregoing and does not sponsor, endorse or recommend Calamos Advisors LLC or any of its products or services.

NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTE