This story appears in the
April 2005 issue of
Entrepreneur.
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As goofy as it may sound, not all mutual funds are growth
funds--even though most of us look for growth when we invest in
funds. Additionally, not all growth funds use the same investment
strategies.
Take the Calamos Growth Fund (CVGRX). Around since 1990,
it's got a long-term track record that's hard to beat.
It's ranked No. 1 in the Multi-Cap Growth classification by
Lipper for the five-and 10-year periods ending December 31, 2004,
and up 18.65 percent last year--and it uses a disciplined
investment strategy.
John Calamos, one of the fund's portfolio managers, points
out a few things he does to manage risk in the fund's
portfolio. First, he says the portfolio is highly diversified among
stocks and the various sectors. In addition, the fund doesn't
use cash as a risk management tool. "We don't cycle in and
out of cash," says Calamos. "We keep fully invested at
all times and try to manage the portfolio for the long term."
Finally, this growth fund isn't into concept-type stocks.
Instead, it seeks out companies that show they can generate
above-average growth and cash flows over time.
With about 140 stocks in its portfolio, the Calamos Growth Fund
is best suited for those who like the notion of investing in a
multicap growth fund. It's not suited to those who are looking
for income.
Dian Vujovich is an author, syndicated columnist and
publisher of fund-investing site www.fundfreebies.com.