The Calamos Strategic Total Return Fund (CSQ)

Meet CSQ, the closed-end fund that's like your portfolio's overachieving middle child – it doesn't get as much attention as its flashier tech-focused siblings, but it consistently brings home report cards that would make any investor proud.

The Stats That Make Other Funds Jealous

First things first: This fund is serving up a tasty 6.98% yield. That's not just good – it's "make your neighborhood index fund feel inadequate" good. For perspective, the S&P 500's measly 1.27% yield looks like it's still getting an allowance while CSQ is earning a proper paycheck.

But here's where it gets interesting: Over the past decade, CSQ has delivered a whopping 270% total return; edging out SPY by a very small margin

So, over THIS time period, CSQ is leaving the S&P 500's 207.73% return eating its dust. It's like watching the tortoise beat the hare, except this tortoise is wearing a jet pack.

However, since inception, they trade very similarly in terms of total returns when CSQ dividends are reinvested:

A Tale of Two Returns

Here's a fun math fact that might blow your mind: whether you get your returns from pure price appreciation (like mostly with SPY) or a mix of dividends and growth (like with CSQ), it's all gravy in the end. Let me break it down with a simple example:

Imagine two paths to $100 in returns:

• Path A (The SPY Way): Your $1000 investment grows to $1100 through price appreciation. Sweet and simple.

• Path B (The CSQ Way): Your $1000 investment pays you $70 in dividends and grows to $1030. That's also $100 in total return!

"But wait," you might say, "isn't getting those dividends better because I can reinvest them?" Well, here's the thing: when a fund pays out dividends, its price typically drops by roughly the same amount. It's like taking money out of your left pocket and putting it in your right - you're not necessarily richer, you've just moved the money around.

The real difference? Psychology and flexibility. Some investors sleep better at night seeing those regular dividend payments roll in, while others prefer to control their own destiny by selling shares when they need cash. It's like choosing between getting a regular allowance or having a larger sum in your savings account - both can work, it just depends on your style.

The Secret Sauce

What's CSQ's secret? Think of it as an investment smoothie blender. Instead of just stocks or just bonds, it throws everything into the mix:

• Common stocks (95.5% of the portfolio)

• Convertible bonds (20.8%)

• Corporate bonds (15.6%)

• A dash of bank loans (6.1%)

• And a sprinkle of other goodies

Yes, those numbers add up to more than 100%. That's because CSQ uses leverage – about 30% worth. It's like the fund took out a gym membership to pump up those returns. Just remember: with great leverage comes great responsibility (and occasional volatility).

The Tech-Savvy Portfolio

Take a peek at CSQ's portfolio, and you might get a sense of déjà vu – it looks remarkably like your favorite index fund's family photo. The guest list reads like a Who's Who of the S&P 500: Apple, Microsoft, Nvidia, and the rest of the tech titans are all there, taking up their usual seats at the head of the table.

But here's where it gets interesting – while CSQ keeps that familiar S&P 500 growth DNA (with about 95% in common stocks), it's got a few tricks up its sleeve. Those convertible bonds and corporate bonds aren't just there for show – they're like having a backup generator for your portfolio, ready to kick in when the growth party hits a temporary power outage. Even ExxonMobil made it onto the VIP list, showing that CSQ isn't afraid to mix things up when opportunity knocks.

The Distribution Dynasty

Here's something as rare as a winning lottery ticket in the CEF world: since 2010, CSQ has only moved its distributions in one direction - up. While other funds were playing "distribution limbo" (how low can you go?), CSQ has been steadily climbing the dividend ladder. The current monthly payout of $0.1025 per share might not sound like much, but it's more reliable than your friend who "definitely" plans to pay back that lunch money from 2019. In fact, it's grown at a 4.4% compound annual growth rate over the last five years - try getting that kind of raise at your day job!

The Bottom Line

Trading at a 1.45% discount to NAV, CSQ is like finding last season's designer bag at an outlet mall – it's still got the quality, just with a better price tag. Yes, it comes with a 4% expense ratio (or 1.53% if you don't count leverage costs), but considering its track record, that's like complaining about the cost of premium gas in your high-performance car.

Should You Invest?

If you're looking for a fund that delivers both growth and income while being more diversified than your Netflix watchlist, CSQ might be your answer. Just remember: like any investment that uses leverage, it can be more dramatic than a season finale during market downturns.

Who Should Consider CSQ? 📊

Key Risk Factors 🎢

Bottom Line 🎯

CSQ best serves investors who:

• Want both capital appreciation and income

• Can invest through tax-advantaged accounts

• Have a long-term investment horizon

• Understand and accept leverage risks

• Are comfortable with market volatility