Calamos launches active closed-end fund ETF

Jan 17th, 2024 | By | Category: Alternatives / Multi-Asset

Calamos Investments has introduced a new actively managed ETF that seeks to deliver both high monthly income and potential capital appreciation by investing in closed-end funds.

John Koudounis, President and CEO of Calamos Investments

John Koudounis, President and CEO of Calamos Investments.

The Calamos CEF Income & Arbitrage ETF (CCEF US) has been listed on NYSE Arca with an expense ratio of 2.74%.

Closed-end funds are collective investment models based on issuing a fixed number of shares that are not redeemable from the fund. These listed investment vehicles often trade at a premium or discount to NAV as a result of market technicals and sentiment.

Calamos is a longstanding participant in the closed-end fund market, having refined its approach over more than two decades.

CCEF will invest in listed, liquid, income-producing closed-end funds across diversified asset classes including fixed income, equities, and options-based funds. The strategy does not include investments in Calamos’ managed closed-end funds, nor will it engage in activism.

Calamos employs active management to capitalize on pricing discrepancies, targeting closed-end funds that are trading at significant discounts. The ETF is positioned as a strategic addition to a core equity portfolio, particularly appealing to investors seeking higher yields. Calamos’ strategy is designed to optimize returns by leveraging these funds’ potential for higher distributions, emphasizing a total return approach.

John Koudounis, President and CEO of Calamos Investments, commented: “Calamos is a recognized leader in the closed-end fund market, where we’ve successfully designed and managed many of these funds for over 20 years. With CCEF, we combine our deep expertise with our passion for providing new avenues for investors to access the advantages of liquid alternative investments, in a benefit-rich ETF vehicle.”

Matt Kaufman, SVP and Head of ETFs at Calamos Investments, added: “Closed-end funds have often provided higher distribution rates compared to traditional investment categories often thought of as ‘yield’ producing. Through CCEF, investors can potentially access a source of regular cash flow and seek to capture meaningful growth from the closed-end fund market.”

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