Cornerstone Advisors has completely divested its position in the Calamos Strategic Total Return Fund (CSQ), selling 1,712,871 shares valued at approximately $32.11 million, according to a May 8 SEC filing. This decision marks a significant shift, as the fund previously constituted 1.1% of Cornerstone’s assets, reflecting a strategic repositioning amid changing market conditions.
The sale comes as CSQ has delivered a 23% gain over the past year, underperforming the S&P 500 by about seven percentage points. This underperformance, coupled with the fund’s heavy exposure to large-cap tech stocks and a leverage ratio exceeding 31%, raises questions about its viability in a rapidly evolving market landscape. Investors may find the fund’s 7.24% annual distribution appealing, but ongoing volatility and a nearly 10% discount to NAV complicate its attractiveness.
For market professionals, this move signals a cautious stance on multi-asset funds in a momentum-driven environment, highlighting the need for careful evaluation of fund performance relative to broader market indices.
Source: fool.com