CHY: This Expensive Convertibles Fund Has A Good Track Record

Power Hedge
Investing Group Leader
(26min)

Summary

  • The Calamos Convertible and High Income Fund offers a 9.84% yield, lower than some peers, but it has outperformed them over the past five years.
  • The fund's balanced investment in convertible bonds and high-yield debt provides stability and potential for sustained distributions, despite market volatility.
  • The fund's allocation to convertibles continues to increase, which could be due to these securities delivering better performance than bonds recently.
  • Current leverage is 37.21%, higher than preferred, but typical for Calamos funds, enhancing both potential gains and risks.
  • Trading at a 9.79% premium, the fund is more expensive than peers but may be justifiable given its historical performance and income potential.
  • Looking for a helping hand in the market? Members of Energy Profits in Dividends get exclusive ideas and guidance to navigate any climate. Learn More »

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The Calamos Convertible and High Income Fund (NASDAQ:CHY) is a closed-end fund that targets income-focused investors. The fund provides one method through which they can generate an income from the assets that they already own, and it does

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This article was written by

Power Hedge
15.65K Followers

Power Hedge has been covering both traditional and renewable energy since 2010. He targets primarily international companies of all sizes that hold a competitive advantage and pay dividends with strong yields.

He is the leader of the investing group Energy Profits in Dividends where he focuses on generating income through energy stocks and CEFs while managing risk through options. He also provides micro and macro-analysis of both domestic and international energy companie. Learn more.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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