NAPERVILLE, Ill., March 4, 2002 (PRIMEZONE) -- In a media teleconference held late last week, executives at Calamos Investments commented that 2002 is shaping up to offer both good news and bad news. While the economy appears to be on an agonizingly slow track back to health, the convertible bond securities' market is alive and well and growing at a record pace.
"We see the investment climate as a very cautious area and there are some cross currents as to whether or not the economy is recovering," said John P. Calamos, President and Chief Investment Officer of Calamos Asset Management of Naperville, Ill., an institutional money management firm and advisor to the Calamos Family of Funds. "The market environment is difficult, especially given the backdrop of `Enronitis,'" Calamos said. "You could characterize our outlook as long-term bullish, and short-term scared."
"We expect the economy will recover, but it will not be a robust recovery," said Nick Calamos, SVP and Managing Director at Calamos. "Amid this global recession, there have even been predictions of a double-dip recession."
"The good news is that unlike the last economic recession which began in 1990 and caused the pipeline of new convertible securities to dry up, that is not the case this time around," said John Calamos. "Even the events of September 11 had little impact on the very strong, record-setting pace of new convertible securities brought to market in 2001."
Last year U.S. corporations issued more than $100 billion in new convertible securities, while European companies issued about $60 billion of convertible securities, cementing their respective places as the two dominant issuers, according to John Calamos. Over the past 10 years, the U.S. and Europe have replaced Japan as the largest issuing markets. At the end of 2001, the global convertible securities market had ballooned to approximately $500 billion.
"This market has clearly grown up very rapidly, and offers expanded opportunities," John Calamos commented. Year to date 2002, almost $20 billion in convertible securities have already been issued, putting current issuance slightly ahead of the levels at this time last year ... And, additional high profile deals are in the wings, he stated.
"Even more positive for the market is the amplified demand for convertible securities, both by issuers increasingly seeking cost-effective access to capital and ways to restructure their balance sheets and from investors who are much more knowledgeable and accepting of adding convertible securities to their repertoire of investment strategies. There's more interest in convertible securities now than I've ever seen in the last 30 years," John Calamos remarked.
As for the equity market, several industries and companies appear to be poised to benefit from current macroeconomic trends, said Nick Calamos. "We like to consider long-term themes within the economy and then find companies that support those themes," he noted. Calamos is bullish on the gaming sector, believing that states will embrace these companies' revenues in light of budget shortfalls. In addition, the firm believes the education sector offers promise as individuals tend to focus on furthering education during a recession.
"We are also bullish on the healthcare sector as we expect spending will continue whether the recession continues or dissipates. And, when the economic recovery does take hold, the telecom and technology sectors are likely to benefit from a flurry of mergers and acquisitions," Nick Calamos added.
Since 1977, John P. Calamos has been recognized as a leader in the investment management of convertible securities, and for his consistent track record. As of January 31, 2001, the firm manages a total of $9.7 billion for individuals and institutional investors through private client management, individually managed accounts, mutual funds and alternative investment strategies.
Calamos was recently recognized for its 300% growth in mutual fund assets during 2001, by Strategic Insight, an independent research firm in New York. This was the highest percent growth in assets of all stock and bond fund managers with at least $2 billion in assets at 12/31/01.
Overall, the firm, which also manages individual portfolios for institutions and private clients, grew total assets under management to approximately $9.4 billion as of December 31, 2001, up from $6.1 billion at the end of 2000.
For more information on Calamos Investments or the Calamos Family of Funds, please visit www.calamos.com. To obtain a Calamos Family of Funds prospectus, which includes fees and expenses, call CALAMOS FINANCIAL SERVICES, INC., the funds' distributor, at 800.582.6959. Investors should read it carefully before investing or sending money.
The views and opinions expressed by John P. Calamos and Nick P. Calamos are as of 2/28/02, and are subject to change at any time based upon market or other conditions.