Jason Stipp: Digging in a little bit to how you invest in individual positions. One of the things that your funds will do is look across the capital structure of a company. So you won't just buy the stock, you may also invest in some of the debt or some of the other things that a company may have available. Especially since we've seen such a strong rally in stocks, are you seeing that other parts of the capital structure in certain investments are more compelling to you, if you wrapped it up and looked at some of the trends in your portfolio?
John Calamos: One of the things we've always done in our investment team, we've focused on that for the last 30 years is capital structure really matters. You can't be a good bond manager, for example, without looking at the equity side of the balance sheet. And you can't be a good equity manager without looking at the leverage in the company. So part of our focus when we look at individual companies is a total look to come up with what we call an intrinsic value of that company. Since we are, as you know, a convertible bond manager as well as a bond manager, we can find different opportunities within a company.
A specific company, we may own the stock in our stock portfolios, own the debt in the bond portfolios or the convertible portfolio. But the analysis of the company is the same, whether we're on the bond side or whether we're on the equity side.
Stipp: Given some of the dislocations that we did see in the market, especially during the downturn, have a lot of the opportunities across the capital structure closed? Or are some of them looking like there are still some opportunities that have been overlooked by the market?
Calamos: Well, we did have a very unusual dislocation, as you know, in the last quarter of '08 and the first part of '09, and we saw some tremendous opportunities caused by that dislocation. I think what happened and that's probably best reflected in spreads--what we've seen happen is the spreads peaked out and they came back to almost what we would consider a normal spread for a recession. In recessionary periods like '02 and '03, for example, that provided good opportunities within the high-yield market and within the convertible bond market. We're still seeing opportunities there, not maybe as great as they were a year ago, but now it's much more normal for a recessionary period.
But in that area we feel you need to be very selective. I think what happened last year in that particular area was a dead cat bounce. If a bond goes from 10 cents on a dollar to 20 cents on a dollar, that's a 100% increase, but it still can default. [laughs]
Stipp: Sure. Time to focus on the fundamentals again. [laughs]
Calamos: I think so, I think so.