Understanding the Calamos Strategic Total Return Fund (CSQ)

What this ETF is trying to do

The Calamos Strategic Total Return Fund (ticker: CSQ) is an exchange-traded fund (ETF) traded on the NASDAQ. While the specific investment strategy isn't detailed in the data, the fund focuses on providing returns to its investors.

What the numbers show

When looking at an ETF, it is important to understand two different types of returns: price return and total return.

• Price Return: This measures only the change in the share price. For CSQ, the one-year price return was approximately 8.36%. The year-to-date (YTD) price return was about 8.07%. Over three years, the price return was approximately 45.10%.

• Total Return: This is a more complete picture because it includes both the share price changes and the money paid out to investors through distributions. The one-year total return was approximately 16.68%, and the YTD total return was about 13.78%. Over three years, the total return was approximately 81.33%.

To visualize the price change, we can look at an estimated price from roughly one year ago, which was $19.15. The current price is $20.75.

Income and distribution explanation

Some investors look for ETFs that pay out regular cash. This is called the distribution yield. CSQ has a distribution yield of approximately 6.98%. This means the fund paid out about $1.45 per share in trailing distributions. These payments usually happen monthly, often on a Friday.

It is important to remember that a high distribution yield is not the same thing as total return. While distributions provide cash, they are separate from the growth of the share price itself.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of the underlying assets in a fund decreases over time. Some investors worry that high payouts might cause this. However, for CSQ, the erosion-risk score is 100, and the label states "No price erosion detected." There is no severe erosion-risk flag for this fund.

Pros

• The fund has shown positive price returns over the last year and three years.

• The total return (which includes distributions) is higher than the price return alone.

• It provides a regular monthly distribution yield.

Cons

• The data provided does not list any specific top holdings, so the exact companies owned by the fund are unknown from this report.

Beginner takeaway

When studying CSQ, notice the difference between the share price moving up and the total return. The total return is higher because it accounts for the cash distributions paid to investors. Always remember that while distributions provide income, they are different from the actual growth of the share price.