In the second quarter of 2025, the Calamos Core Plus Fixed Income Strategy showcased impressive results, delivering a gross return of 1.56% and a net return of 1.44%. These figures represent a notable outperformance compared to the Bloomberg US Aggregate Bond Index, which recorded a return of 1.21% over the same period. The key driver behind this success was the strategy's astute security selection, particularly within the non-financial corporate bond segment, with consumer non-cyclical and cyclical industries contributing significantly to the positive performance. Despite these strong gains, positions in Treasury bonds experienced some drag, slightly tempering the overall returns.
The Calamos Core Plus Fixed Income Strategy is designed as a multi-sector approach, primarily targeting U.S. issuers. Its overarching goal is to achieve a superior level of current income and total return that exceeds its benchmark over an extended market cycle. This strategy emphasizes a diversified investment philosophy, carefully selecting fixed-income assets to optimize yield and capital appreciation while managing risk effectively.
A detailed analysis of the second quarter's performance reveals that the strategic allocation to corporate bonds, especially in consumer-focused sectors, proved highly beneficial. The team's ability to identify undervalued or high-potential securities within these industries allowed the portfolio to capture significant alpha. This proactive security selection is a cornerstone of the strategy's investment process, aiming to capitalize on market inefficiencies and capitalize on strong corporate fundamentals.
Conversely, the strategy faced some headwinds from its holdings in Treasury securities. While typically viewed as safe-haven assets, Treasury bonds can be sensitive to interest rate fluctuations and broader economic shifts. The underperformance in this segment highlights the dynamic nature of fixed income markets and the challenges inherent in managing a diversified portfolio across various interest rate environments.
Looking ahead, the Calamos Core Plus Fixed Income Strategy will continue to leverage its multi-sector expertise and rigorous research process. The team remains committed to identifying attractive opportunities within corporate bonds, while also carefully monitoring and adjusting its exposure to other fixed-income sectors, including Treasuries, to navigate evolving market conditions and sustain its outperformance relative to the benchmark.
The second quarter of 2025 demonstrated the effectiveness of the Calamos Core Plus Fixed Income Strategy in achieving its objectives. With a notable lead over the Bloomberg US Aggregate Bond Index, the strategy's success was largely attributed to its skilled security selection in non-financial corporate bonds, particularly in consumer-oriented sectors, despite some negative contributions from Treasury holdings. This robust performance underscores the strategy's disciplined approach to fixed income investing.