This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

World Allocation Funds Dodge Trouble Spots

Forester also likes AstraZeneca (AZN), the British drug giant. The stock trades for 7.5 times next year's earnings and has a dividend yield of 5.9%.

Calamos Global Growth & Income holds an unusual mix that includes a big slice of convertible securities and foreign government bonds. The fund currently has 40% of assets in convertibles and 11% in sovereign bonds, with most of the rest in equities. Portfolio manager Nick Calamos says that the bonds and convertibles can cushion the fund during periods when stocks are falling. Calamos aims to deliver equity-like returns, while limiting losses in downturns. During the past five years, the fund has returned 4.0% annually, outdoing 62% of peers.

Recently Calamos has begun raising his equity allocation. He says that investors have become overly pessimistic about the economy. "The market is pricing in a mild recession in the current valuation of equities," he says.

Calamos concedes that many risks remain in the markets. That is why he continues to hold bonds and convertibles. Calamos typically favors growth stocks. These days he is focusing on companies that can grow, even if the economy slips into recession. A holding is Qualcomm (QCOM), which licenses patents and makes chips that are crucial for wireless phones. With demand for wireless service jumping around the globe, earnings climbed 34% in the past quarter.

He also owns Chesapeake Energy (CHK), a natural gas producer. Calamos says that the returns on capital will increase as the company exploits its growing reserves.

Loomis Sayles Global Equity and Income keeps from 30% to 70% of its assets in equities. The fund is currently near the top limit, with 66% of assets in stocks. The portfolio managers figure that bond yields are puny. They worry that rates could rise in the next several years, which would punish bond prices. "Over the next three years, equities should be the place to be," says portfolio manager Warren Koontz.

A big stock position has helped the fund excel in recent rallies. In 2010, the fund returned 21.5% and ranked as the top performer in the world allocation category. During the past five years, Loomis Sayles returned 7.4% annually, outdoing 94% of peers.

2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
AAPL $129.09 0.49%
FB $79.75 0.99%
GOOG $571.34 2.32%
TSLA $197.32 -2.96%
YHOO $44.11 -0.38%


DOW 18,288.63 +155.93 0.86%
S&P 500 2,117.39 +12.89 0.61%
NASDAQ 5,008.0960 +44.5690 0.90%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs