Navigating Growth: The Calamos Approach in a Dynamic Market
Strategic Focus on Quality and Growth
The Calamos Growth Fund consistently prioritizes investments in businesses characterized by robust fundamentals and significant growth potential. This strategy is underpinned by a keen awareness of prevailing thematic tailwinds, particularly those within the technology sector.
AI Infrastructure: A Major Growth Catalyst
A key driver of recent market activity and the fund's strategy is the massive investment in AI infrastructure. The largest cloud providers are projected to increase their capital expenditures significantly, with an expected spending exceeding $750 billion this year, representing a substantial two-thirds increase over the 2025 figures. This accelerated investment underscores the burgeoning demand for AI-related hardware and services.
Second Quarter Performance Overview
For the quarter ending June 30, 2026, the fund's Class I shares delivered a return of 20.07% (at Net Asset Value). This performance demonstrated strong growth, though it slightly trailed the S&P 1500 Growth Index, which posted a return of 21.68% during the same period. This indicates solid performance in a highly competitive market environment.
Applied Materials' Significant Contribution
A standout performer in the fund's portfolio was Applied Materials. Its stock price more than doubled during the quarter, surging by 112%. This remarkable increase was fueled by the company reporting a record earnings quarter and providing a significantly upgraded outlook for its future growth, reflecting its crucial role in supplying the semiconductor industry that underpins AI development.
Sectoral Allocation: Information Technology and Consumer Discretionary
From a sector allocation perspective, the most substantial absolute portfolio weights are concentrated in information technology and consumer discretionary. This strategic overweighting reflects the fund's conviction in these sectors' continued growth and their direct and indirect benefits from technological advancements and evolving consumer behaviors.
Market Rally and AI Buildout Impact
The second quarter witnessed a robust rally in growth stocks, predominantly led by technology firms. This surge was primarily attributed to the ongoing and expanding buildout of AI infrastructure, which has created unprecedented demand for advanced computing and data processing capabilities.
Economic Outlook for the Second Half of 2026
Looking ahead to the latter half of 2026, the economic outlook remains positive. The base case anticipates a continued trend of falling inflation, coupled with stable employment figures and sustained GDP growth. These macroeconomic conditions are expected to foster continued strength in corporate earnings and mitigate the need for further interest rate adjustments, providing a favorable backdrop for equity markets.
