|Username||Post: The Daily Insider Buying Stock for 12/17/2013 is CALAMOS ASSET MANAGEMENT,|
12-17-13 12:49 AM - Post#7041
CALAMOS ASSET MANAGEMENT, INC.. Chairman, CEO & Global CIO, 10% Owner JOHN P SR CALAMOS bought 31,199hares on 11-20-2013 at $ 10.85
Calamos Asset Management, Inc. is the sole manager of Calamos Investments LLC, which owns and manages our operating companies. For more than 35 years, we have provided investment advisory services to institutions and individuals, managing and advising $30.6 billion in Total Assets as of December 31, 2012. Throughout our history, we have based our investment philosophy on the belief that the key to consistent, long-term success is achieving an optimal balance between enhancing return and managing risk. We have consistently applied our investment philosophy and proprietary processes centered on risk management across a range of U.S. and global investment strategies.
Our Company began as a boutique investment manager, with an emphasis on strategies that sought to maximize the potential of convertible securities to manage risk and build wealth. Today, we are a global asset management firm that offers strategies to fulfill a range of asset allocation goals through a multi-team platform. We are headquartered in the Chicago metropolitan area. Our Company also has offices in London and New York.
Our evolution as a company has been a logical expansion of our core investment discipline and proprietary resources, which are built upon gaining a comprehensive understanding of a company and the relative attractiveness of the securities within its capital structure. The breadth and depth of this approach has provided the foundation for building multiple specialized investment teams and diverse investment strategies. All of our portfolios benefit from the research and insights of a collaborative investment culture and the accumulated knowledge we have amassed over the decades.
As more fully described in the Investment Strategies of Item 1. Business , our strategies include U.S. equity, low-volatility equity, global/international equity, fixed income, convertible, and alternative. We believe a disciplined adherence to our investment philosophy has enabled us to deliver strong risk-adjusted returns in many of our strategies over multiple market cycles.
We seek institutional and individual clients with long-term investment horizons. We make our range of investment strategies and services available to these clients, directly and through intermediaries, by offering investment products designed to suit their investment needs, such as open-end funds, closed-end funds, institutional accounts and managed accounts. We plan to continue to introduce new investment strategies and supporting services that will provide the opportunity for attractive risk-adjusted returns.
We believe our long-term investment performance, broad range of investment strategies, diverse product offerings and emphasis on sales and client service efforts have allowed us to help our clients create wealth over full market cycles, which, in turn, grew our Total Assets and revenues throughout the ye ars. Ours is a culture of innovation, global perspective, and clear alignment with our clients’ interests. Over the decades, we have consistently demonstrated strength in developing strategies that capitalize on the opportunities of the changing investment landscape .
In 2012, we experienced a reduction in Total Assets, driven primarily by net outflows from investment strategies that have experienced recent performance challenges and from strategies that were closed to new investors. These challenges were exacerbated by the overall industry outflows in U.S. and international equities. The Company’s global and international strategies that were open to new investors during all of 2012, however, had net inflows for the year. Across our products, we have carefully assessed performance issues and believe that we have made and will continue to make adjustments appropriate for current market conditions. Our investment team is finding new opportunities in various sectors and asset classes globally, including the convertible market. Additionally, we recently reopened our market neutral strategy and two of our lower-volatility equity strategies, which were closed to new investors during 2012. We believe reopening these strategies will help to attract new investors and flows during 2013.
We provide additional information about Calamos Asset Management, Inc. in the Investor Relations section of our website at www.calamos.com/Investors. This information includes corporate governance documents, press releases, investor presentations, SEC filings and Total Assets reports, among others. We encourage you to visit and review our website. The information on our website is not a part of this Annual Report on Form 10-K.
Our business strategy is designed to ensure we maintain focus on our investment philosophy and enhance it, given current conditions in the economy and markets. We apply a disciplined approach to investment research and portfolio management, which allows us to significantly leverage our investment talent.
Throughout the history of our firm, we have thoughtfully leveraged our investment expertise to expand our investment platform and investment team resources in response to market opportunities and client needs. We have also dedicated resources to expanding our distribution and client servicing capabilities to retain existing clients and attract new clients globally.
Our goal is to continue to grow our business and diversify the assets we manage by investment strategy, product, service and type of client. To take advantage of market opportunities for attractive risk-adjusted returns, we have selectively created complementary investment products over the years and also have expanded our business through strategic acquisitions. Our execution of our strategy reflects our emphasis on building our capabilities in ways that position our business for long-term expansion, enhance performance, and improve client responsiveness.
In 2012, we further enhanced our investment platform and our investment team to better serve our clients. We moved from a one-team one-process approach to a multi-team investment structure. This structure supports our strategic efforts by providing clients with the specialized expertise that the evolving global markets increasingly demand. Through the 2012 acquisition of Black Capital, LLC, we hired Gary D. Black to serve as Executive Vice President, Global Co-Chief Investment Officer and Chief Investment Officer of Alternative Strategies. Mr. Black brings extensive experience leading global teams of investment professionals, across asset classes. As a result of acquiring Black Capital, LLC, which Mr. Black founded, we added a dedicated long-short equity investment team to expand our existing capabilities in alternative strategies, a significant and growing opportunity globally. This followed the hiring of a dedicated value equity team earlier in the year to assume management of our value strategy. Selectively expanding our capabilities by adding investment professionals ensures that we do not dilute the resources we dedicate to existing strategies.
We have been, and will continue to be, guided by the following principles:
Maintain Strong Investment Performance
Our strategy is to maintain our performance by consistently applying our investment philosophy and processes, while actively managing our strategies to maintain a balance of risk and reward over the full course of a market cycle and during changing market conditions. We seek to protect our clients’ assets through our management of both investment portfolios and investment strategy capacity. Accordingly, at times we have chosen to restrict inflows or close products to new investments if we believe it is in the best interests of our current clients to do so. Similarly, we may discontinue products if we do not believe satisfactory risk-adjusted returns can be achieved for our clients.
Focus on Clients, With an Emphasis on Serving Long-Term Investors
We believe that managing our clients’ assets is an honor and a responsibility. Client service is crucial to our ongoing success. In all our activities, our goal is to have our clients’ best interests in mind and to work diligently and professionally to exceed client expectations for performance and service. We strongly believe that the success of our Company is a by-product of our success in helping clients achieve their investment objectives. In particular, we seek to attract, develop and maintain long-term client relationships by providing excellent client service, including educating investors about our investment philosophy and processes. We take great care to ensure that the resources devoted to existing clients and strategies are not compromised by our growth and expansion efforts.
Selectively Expand Our Investment Strategies
Since the introduction of our first convertible strategy in 1977, we have strategically expanded our product offerings. Each expansion has leveraged our core competencies in investment research and portfolio management. We will continue to expand our investment strategies selectively in areas where we determine we can achieve attractive risk-adjusted returns over the long-term. In recent years, we launched the Calamos Discovery Growth Fund, a small/mid-cap growth fund for U.S. investors. To broaden access to our expertise to non-U.S. investors, we added an emerging markets fund to our family of Ireland-based UCITS funds in 2011. In 2012, we again expanded our offerings to non-U.S. investors with the addition of the Calamos Global High Income Fund and to both U.S. and non-U.S. investors with the addition of the Calamos Arista Strategic Fund LTD. Through such strategic expansion efforts, we believe we can enhance our ability to increase Total Assets and revenues.
Expand Our Client Base
Over recent years, as part of our strategic initiatives, we have increased our focus on the institutional business through additions to staff in direct institutional sales, consultant relations, client relationship management and non-U.S. sales. These efforts have enhanced both our global business development as well as client service and retention efforts, along with increasing brand awareness.
We distribute the Calamos open-end funds and managed accounts primarily through financial intermediaries. We have developed an extensive network of third-party financial intermediaries, and our products are structured to meet their needs and those of their clients. Our sales professionals are located across the United States and in Europe, and they act in a consultative role to provide our clients with insight. We intend to grow our intermediary business through relationships. We also manage five closed-end funds that currently trade on the NASDAQ. We operate a wealth management division that serves high net worth individuals, family offices, endowments and other organizations. The development of these business segments is strategic and includes the continued delivery of a high level of client service and solid relative investment performance.
Capitalize on Our Recognized and Respected Brand
We believe that brand awareness is essential in expanding our client base and adding value. Our focus is to continue to highlight the uniqueness of our investment process, our investment strategies and global investment research, and to expand our position in the global markets.
In 2012, many of our funds and strategies were recognized for long-term performance and risk management by companies and publications such as Morningstar, Kiplinger’s Personal Finance, Smart Money, Dow Jones, Citywire and Lipper . John P. Calamos, Sr. has written books on investments in convertible securities and is recognized internationally as an investment expert. He and other members of our investment team often discuss their investment insights with respected industry media outlets including CNBC, Forbes, Pensions & Investments, IPE, Professional Pensions, Financial News, Citywire, Reuters, Crain’s Chicago Business, Ignites and FundFire, among others. Mr. Calamos was named to Citywire’s Euro Stars list of top investment managers in June 2012. In addition, he hosted an online webinar in 2012 to discuss our emerging market investment strategies and strengthen the Calamos brand and the awareness of our investment philosophy.
We raise brand awareness through strategic sponsorships, including taking a leadership role at multiple industry and financial services conferences. In 2012, we sponsored the Milken Institute Global Conference in California and the Milken Institute London Summit. Mr. Calamos participated in panel discussions at these conferences. The Company participated in numerous trade shows and other industry activities in 2012, including the Capital Link Closed-End Fund Forum in New York City, the Schwab Impact Conference in Chicago, and the IPE Awards in Copenhagen. Additionally, as a member of the Hellenic Initiative, Mr. Calamos, along with other global business leaders, provided economic and business-development advice to leaders of the Greek government.
We believe that a successful investment philosophy must be consistent and long-term in its focus. Our investment philosophy is based on our views about the longer-term trends and economic conditions that affect financial markets. We assume there will always be unforeseen events that will continually test conventional wisdom. We believe we can achieve favorable investment results over extended periods of time based on our experience throughout many market cycles, our continued study of economics and financial markets, and our application of sound investment processes that can help manage the volatility and risk associated with financial markets.
The creation of wealth for our clients over the long-term is not solely about producing returns, but about managing risk, which we define as the potential for loss and the variability of investment returns. We offer investment strategies that represent distinct balances, or profiles, of risk and reward. We believe that diversification is critical to managing risk and moderating the impact of volatile markets. Our objective is to maintain the consistency of each strategy’s risk and reward profile, whether managing a conservative or an aggressive strategy.
We make decisions about individual securities within the context of our perspective on global macroeconomic themes. While the markets may not always follow the same pattern every economic cycle, history provides a valuable context for evaluating the risks and opportunities of the current investment environment. Our investment decision-makers have decades of experience managing through many market cycles.
A dedication to client service extends across our organization and guides the day-to-day decision making within our Company. Accordingly, our investment management team is guided, above all else, by the long-term interests of our clients. Our global investment platform has evolved from a single integrated team to multiple teams with specialized expertise. The investment team includes 60 investment professionals, organized into specialized teams. Having distinct teams ensures that investment professionals are able to concentrate on their core areas of responsibility to best serve our clients. This multi-team structure allows us to add investment talent and teams with other specializations, without compromising the interests of clients in other of our strategies.
Our investment professionals are focused on portfolio management, research, trading, portfolio administration and developing analytical models. The investment organization is led by our Global Co-Chief Investment Officers John P. Calamos, Sr. and Gary D. Black. In 2012, Nick P. Calamos stepped down from the role of President of Investments and Co-Chief Investment Officer and transitioned into a senior advisory role with the firm. Global Co-Chief Investment Officers, Co-Heads of Research and Investments and Co-Portfolio Managers are supported by and lead a team of investment professionals whose valuable contributions create a synergy of expertise that can be applied across many different investment strategies.
In 2012, we further strengthened our investment organization with the formalization of an Investment Committee that performs the following functions:
• Establishment of top-down global macroeconomic views;
• Discussion of sector, thematic and geographic positioning across strategies;
• Oversight of risk management across strategies;
• Monitoring and evaluation of investment performance; and
• Evaluation and recommendation of enhancements to the investment process.
The Investment Committee operates as a team and consists of our Global Co-Chief Investment Officers, who will lead the Committee, and a select group of senior investment professionals, including Co-Heads of Research and Investments, and Co-Portfolio Managers. Other members of the investment team will also participate in Committee meetings in connection with specific investment related issues or topics as deemed appropriate. Membership of the Investment Committee may be modified to ensure we adapt to dynamic economic, capital market and investment environments as well as incorporate diverse views into our investment process. Portfolio holdings are reviewed and trading activity is discussed on a regular basis by team members.
We believe we are staffed to successfully manage our current investment strategies. As we thoughtfully grow our assets and expand investment capabilities, we expect to continually evaluate and strategically deepen the investment resources we employ. Talent development across the firm is critical to fulfilling our mission and to delivering upon our strategic objectives. We intend to further strengthen our teams not only through hiring but also by developing the skills of the talented individuals within our organization.
Our organizational structure also supports an apprentice system which allows us to identify and cultivate talent. Members of our investment team participate in a career track system that helps institutionalize our investment process by immersing many analysts and other team members in our investment philosophy and process from early in their careers. Additionally, key members of the investment team participate in the long-term component of our incentive compensation plan. Through this plan, investment team members can share in the overall success of our Company.
Our investment processes combine our insights about economic conditions and broader investment themes with our analysis of individual securities. We use proprietary research and monitoring processes that leverage our years of experience and application, as well as long-standing principles and current academic research. Risk management is integrated fully throughout all aspects of our investment approach. Our processes rely on qualitative research and also employ a variety of quantitative tools.
Our first institutional account mandate was initiated in 1981 for a pension fund account. In the late 1980s, we became one of the first participants in the broker-sponsored managed account business. In 2002, we launched the first of our five closed-end funds. As we have done in the past, we continue to strive to expand our presence in distribution channels that best deliver our strategies to long-term investors in order to grow our client base, Total Assets and revenues. In recent years, we have placed greater emphasis on institutional investors, including private pension funds, public funds, endowment funds, banks and insurance companies. We have also placed greater emphasis on other channels for open-end funds and managed account products such as 401(k) platforms, broker consultants, broker-dealers, registered investment advisers, financial planners, family offices, private foundations and high net worth investors.
In 2012, as part of our ongoing efforts to expand our distribution opportunities and client base, we have maintained our focus on the institutional market and retirement platform opportunities, and selectively increased the number of intermediaries that distribute Calamos products globally.
In 2012, our intermediary business experienced net outflows, primarily related to performance challenges in our U.S.-based funds and outflows in funds that were closed to new investors. However, we continued to see positive flows in our international, global and emerging markets funds. As these products continue to mature, we expect that they can provide ongoing opportunities for this channel. Increasing the visibility of our international, global and emerging market products remains an important focus of our efforts in 2013.
We also see additional growth opportunities for the intermediary channel resulting from the January 2013 reopening of three funds: the Calamos Market Neutral Income Fund, Calamos Global Growth and Income Fund and the Calamos Growth and Income Fund. We believe that these funds continue to provide a differentiated approach to meeting diverse investor needs, including those related to volatility concerns. Additionally, as the role of alternative investments grows in this channel, we believe the reopening of the Calamos Market Neutral Income Fund positions us advantageously.
Defined contribution plans continue to be a significant segment of the U.S. intermediary market and open-end fund sales. We view the defined contribution industry as a strong target market, given our focus on risk management and outperformance over full and multiple market cycles. In 2012, our ongoing efforts yielded several new retirement and national account relationships. Our efforts include focusing key resources and personnel on a targeted set of opportunities, including fee-based open-end fund platforms and separately managed accounts in the four major wire houses. We continue to align the incentives of our sales teams to emphasize client service and client retention.
Client accounts held at our top ten financial intermediaries represented 55% of our Total Assets as of December 31, 2012.
In 2012, the institutional channel experienced net outflows. Similar to our intermediary business, performance challenges in U.S. growth strategies and outflows in closed strategies slowed asset growth. We continued to advance our efforts in the institutional channel. In particular, we believe our suite of international, global and emerging market strategies are positioned for growth, given their long-term investment performance and market demand. We have been encouraged by the interest shown by non-U.S. clients in our investment strategies and we intend to maintain a focus on non-U.S. opportunities.
Calamos Wealth Management is a registered investment advisory firm servicing affluent families, family offices, foundations and small institutions. Calamos Wealth Management provides investment advisory and wealth planning services under the guidance of the Investment Committee and management team. Investment Advisory services include assessment of investment programs and goals, development of an investment policy statement, and the design of a strategic asset allocation. Clients' asset allocations are implemented through a combination of Calamos Advisor offerings and solutions provided by carefully selected independent third party investment managers providing flexible, opportunistic and risk-managed portfolios for clients' global asset allocation needs. Calamos Wealth Management wealth planning professionals work with clients' legal and tax advisors to provide information and counsel to clients and their families on trust and estate, tax, and financial planning matters as they relate to the client’s personal goals and overall investment strategy. By integrating wealth planning and investment advisory services, Calamos Wealth Management seeks to help clients arrive at holistic solutions to meet their current needs and preserve and grow their wealth over generations.
In 2007, we established Calamos Global Funds, an Ireland-domiciled UCITS platform. In 2009, we established an office in London, where we serve European intermediary and institutional channels. In 2012, we introduced the Calamos Global High Income Fund, a UCITS fund designed to tap into global investor demand for income strategies. We believe that our high income approach, which we have utilized in a U.S. mutual fund since 1999 as well as in institutional portfolios, may be compelling for more conservative income-oriented investors seeking competitive returns in a global low interest-rate environment.
In 2013, our focus continues to be on building the brand globally in the intermediary and institutional business channels, including efforts to increase investment mandates through large distributors, investment consultants and institutional clients, such as sovereign wealth funds, in Europe, Canada, Asia, Australia, Latin America, and the Middle East. Having secured approval in 2012 from various regulators within the Asia Pacific region to offer our investment capabilities to institutional and retail investors, we expect to build on these efforts in 2013. We believe that our global strategies are positioned to capitalize on opportunities we see in select non-U.S. markets.
Our board’s nominating and governance committee recommended, and the board approved, all of the nominees named below for election as members of the board of directors of Calamos Asset Management. Thomas F. Eggers and Richard W. Gilbert, each are current directors are standing for re-election; and Gary D. Black, Keith M. Schappert and William N. Shiebler, who were appointed to the board on November 1, 2012, August 22, 2012 and August 22, 2012, respectively, are standing for election for the first time. The nominees for election by the holders of our Class B common stock, voting as a separate class, are John P. Calamos, Sr. and Nick P. Calamos. The holders of our Class A and Class B common stock, voting together as a group, are entitled to vote for the election of the remaining five director positions, the nominees for which are Gary D. Black, Thomas F. Eggers, Richard W. Gilbert, Keith M. Schappert and William N. Shiebler. If elected, each director will serve until the 2014 annual meeting of stockholders, or until a successor is elected and qualified or until that person’s earlier resignation, retirement, death, disqualification or removal.
The board has affirmatively determined that the board is currently composed of a majority of independent directors and that the following nominees are independent as defined under the NASDAQ Stock Market rules: Thomas F. Eggers, Richard W. Gilbert, Keith M. Schappert and William N. Shiebler. For a director to be considered independent, the board must determine that the director does not have any direct or indirect material relationship with the company, other than his service as a director. In making the determination of independence, the board applies the objective measures and principles contained in the NASDAQ and SEC standards defining independence, considers any direct or indirect material relationships which the director has with the company, and any other relevant facts and circumstances.
Unless you mark on your proxy card to withhold authority to vote for one or all of the director nominees, the persons named as proxy holders intend to vote “FOR” all of these nominees; however Class A stockholders are entitled to vote only with respect to Messrs. Black, Eggers, Gilbert, Schappert and Shiebler.
Recommendation of the Board
The board of directors recommends a vote “FOR” each of the following nominees. The voting requirements for this proposal are described in the Voting Information section.
Listed below are the names, ages, and principal occupations for the past five years or more for the director nominees:
John P. Calamos, Sr. , 72, is our Chairman of the Board, Chief Executive Officer and Global Co-Chief Investment Officer. Mr. Calamos is the uncle of Nick P. Calamos and founded our predecessor company in 1977. Previously, he enlisted in the United States Air Force and ultimately earned the rank of Major. Mr. Calamos received his undergraduate degree in economics and an MBA in finance from the Illinois Institute of Technology. He is a member of the Investment Analysts Society of Chicago. Mr. Calamos is a nominee for election by the Class B stockholders and has been a director since 2004.
As founder, Chairman of the Board, Chief Executive Officer and Global Co-Chief Investment Officer, Mr. Calamos is uniquely qualified to serve on our board of directors. Mr. Calamos has been with our organization for more than 36 years and brings unparalleled knowledge of our business and experience in the investment management industry
Nick P. Calamos , 51, has been a Senior Advisor to the company since August 2012 and is a director of our company. Previously, Mr. Calamos was our President of Investments and Co-Chief Investment Officer since December 2009 and our Senior Vice President and Co-Chief Investment Officer prior thereto. He joined our predecessor company in 1983 and has more than 29 years of experience in the investment industry. He received his undergraduate degree in economics from Southern Illinois University and a master’s degree in finance from Northern Illinois University. A Chartered Financial Analyst, Mr. Calamos is a member of the Investment Analysts Society of Chicago. Mr. Calamos is a nominee for election by the Class B stockholders and has been a director since 2004.
Mr. Calamos’ qualifications to serve on our board include his previous experience as an investment professional and his position as director since 2004.
Gary D. Black , 53, is our Executive Vice President, Global Co-Chief Investment Officer and Chief Investment Officer of Alternative Investments since August 2012. Mr. Black previously served as Chief Executive Officer, Chief Investment Officer and founding member of Black Capital, LLC. Prior to that, he served as Chief Executive Officer of Janus Capital Group from January 2006 through July 2009, and President and Chief Investment Officer from April 2004 to January 2006. Prior to joining Janus, Mr. Black was Chief Investment Officer of Global Equities at Goldman Sachs Asset Management (GSAM), which he joined as a partner in June 2001. Prior to this role, he headed GSAM’s U.S. distribution efforts. Previously, Mr. Black was Executive Vice President and head of Alliance Bernstein’s global institutional business. He started his investment career in 1992 at Sanford C. Bernstein where he served as a senior research analyst and was named top analyst in his sector for six consecutive years. Mr. Black earned an M.B.A. from Harvard Business School and a B.S. in Economics from the Wharton School of the University of Pennsylvania.
Mr. Black’s qualifications to serve on our board include the scope and breadth of his investment and leadership experience in the financial services and investment management industry, as well as his significant experience in leading investment teams on a global basis.
Thomas F. Eggers , 60, has served on our board since January 2012 and as our lead independent director since August 2012. From 2006 through 2008, Mr. Eggers was the Chief Executive Officer and from 2005 through 2008 the President and a board member of the Dreyfus Corporation. While at Dreyfus, he was a member of the Executive Committee of BNY Mellon Asset Management and served on the Operating Committee of The Bank of New York Mellon. For a three-year period between 2002 to 2005, Mr. Eggers was the President and Chief Executive Officer of Scudder Investments. In 1996, he was President of Dreyfus Investments while being appointed Vice Chairman of the Dreyfus Corporation in 1999 and became President in 2001. Mr. Eggers began his financial services career in 1976 at Columbia Savings, moving in 1979 to PaineWebber as a Financial Advisor and later into the asset management area. Mr. Eggers is a director and principal investor of Nextalk, Inc. and Minyanville Media, Inc. He has also held director or advisor positions in the financial services industry. He attended Marquette University as an undergraduate, completed a three-year Securities Industry Certification at the Wharton School of Business, and is a frequent guest lecturer at business and industry forums.
Mr. Egger’s qualifications to serve on our board include his extensive experience in numerous senior executive positions in the financial services industry, his prior role as an independent trustee for a mutual fund complex, and his investment management expertise and intelligence.
Richard W. Gilbert , 72, has served on our board since 2005. From June 4, 2002 to January 28, 2005, Mr. Gilbert served as a member of the Calamos Family Partners advisory board. In addition to serving on the board of Calamos Asset Management, he has served as an independent director for the Principal Mutual Funds from 1984 to 2012 and is an independent director of the Horton Insurance Agency. From 1990 to 1995, Mr. Gilbert was Chairman and director of the Federal Home Loan Bank of Chicago. He also has served as a director of Bulkley Capital, L.P. since 1996. Before retiring from active management in 1994, Mr. Gilbert was Publisher and Chief Executive Officer of Pioneer Press Newspapers in suburban Chicago; President and Chief Operating Officer of Park Communications, a media company in Ithaca, New York; and President of the Des Moines Register, a family-owned communications company. Mr. Gilbert graduated from Simpson College in Indianola, Iowa.
Mr. Gilbert’s qualifications to serve on our board include his vast experience in numerous senior executive positions held throughout his career, his role as an independent director at the Principal Funds for over 29 years, and his investment management and communications insight.
Keith M. Schappert, 62, has served on our board since 2012. Since 2008, Mr. Schappert has operated his own consulting business and has served as director on a number of financial industry boards including MetLife Series Trust, Commonfund, Trilogy Global Advisors and Mirae Asset Management. Mr. Schappert spent nearly thirty years at JP Morgan Investment Management, advancing from Fixed Income Portfolio Manager to President and Chief Executive Officer. In 2001, Mr. Schappert became President and Chief Executive Officer of Federated Investment Advisory Companies, later moving to Credit Suisse as Regional Head of the Americas for Asset Management. Mr. Schappert is a 1973 graduate of Harvard College.
Mr. Schappert’s qualifications to serve on our board include his far-reaching experience in the financial services industry consisting of numerous directorship and senior executive positions together with his direct knowledge and skill in portfolio management.
William N. Shiebler , 71, has served on our board since 2012. From 2002 to 2007, Mr. Shiebler was Chief Executive Officer of the Americas for Deutsche Asset Management until his retirement. Prior thereto, Mr. Shiebler served as Senior Managing Director of Putnam Investments and President and Chief Executive Officer of Putnam Mutual Funds. He also spent twelve years at Dean Witter Reynolds, departing as President and Chief Operating Officer of the Intercapital Division and the firm’s mutual fund business. Mr. Shiebler has served on a number of corporate and non-profit boards in the U.S. and Europe and is currently active with a variety of business, community and charitable organizations. He was a Trustee of Scudder Mutual Funds, was a member of the Presidential Commission on Medicaid, is a Trustee of the United States Ski and Snowboard Team, and is the Chairman of an Advisory Board for medical research at the University of Utah.
Mr. Shiebler’s qualifications to serve on our board include his comprehensive senior executive officer experience in the financial industry complemented by the breadth and depth of his domestic and global experience from serving with a variety of asset management and banking organizations.
MANAGEMENT DISCUSSION FROM LATEST 10K
We provide investment advisory services to institutions and individuals, managing $30.6 billion in client assets as of December 31, 2012 through a variety of investment products designed to suit their investment needs. In the third quarter we began reporting Total Assets. Total Assets includes assets under management totaling $29.7 billion as well as $925 million of assets in which we provide model portfolio design and oversight.
Our operating results fluctuate primarily due to changes in the total value and composition of our Total Assets and with our ability to manage variable expenses. The following table details our Total Assets, based on the four investment product types we offer in the funds and separate account categories, as of December 31, 2012, 2011 and 2010.
In order to increase our Total Assets and expand our business, we must develop and market investment products and strategies that suit the investment needs of our target clients — investors seeking superior, risk-adjusted returns over the long-term. The value and composition of our Total Assets and our ability to continue to attract and retain clients will depend on a variety of factors, including, among others:
purchases and redemptions of shares of the open-end funds and other investment products;
the amount of distributed and reinvested capital gains and income;
fluctuations in the global financial markets and the valuations of securities that result in appreciation or depreciation of assets;
the use of leverage within the closed-end funds;
our ability to educate our target clients about our investment philosophy and provide them with best-in-class service;
the relative investment performance and volatility of our investment products as compared to competing offerings and
competitive conditions in the asset management and broader financial services sectors;
investor sentiment and confidence; and
our introduction of new investment strategies and products, and our decision to close and re-open strategies when deemed in the best interests of our clients.
Funds include our open-end and closed-end funds, which are commingled investment vehicles registered under the Investment Company Act of 1940, as amended, (“Investment Company Act”) as well as our Dublin, Ireland-domiciled Calamos Global Funds PLC, also referred to as Offshore Funds.
Open-End Funds. Open-end funds are continually offered and are not listed on an exchange. Open-end funds issue new shares for purchase and redeem shares from shareholders who sell. The share price for purchases and redemptions of open-end funds is determined by each fund’s net asset value, which is calculated at the end of each business day. Assets in open-end funds vary as a result of both market appreciation and depreciation and the level of new purchases or redemptions of shares of a fund. Investment management fees, including performance-based fees, are our principal source of revenue from open-end funds and are primarily derived from assets under management. We offer several share classes in each open-end fund to provide investors with alternatives to pay for commissions, distribution and service fees.
Closed-End Funds. Closed-end funds typically sell a finite number of shares to investors through underwritten public offerings. After the public offerings, investors buy closed-end fund shares from, and sell those shares to, other investors through an exchange or broker-dealer market. All of the closed-end funds that we manage currently use leverage which increases their total assets. Assets in closed-end funds vary due to the amount of assets raised in underwritten public offerings, the amount of leverage utilized and market appreciation or depreciation. Our revenues from closed-end funds are derived from the investment management fees on the assets that we manage. In addition, in a typical underwritten public offering, investors are charged a commission by the selling firms. We do not receive or pay commissions in connection with sales of closed-end fund shares, although we may pay asset-based distribution and service fees, as well as one-time distribution and service fees to underwriters for underwriting public offerings of closed-end funds.
Separate accounts include institutional accounts and managed accounts for high net worth investors. Fund flows into and out of such accounts, which we refer to as purchases and redemptions, affect our level of Total Assets. Total Assets from these accounts also vary as a result of market appreciation and depreciation. Our revenues from separate accounts are derived from investment management fees that we charge, including performance-based fees where applicable. Provided below is a brief differentiation of these accounts:
Institutional accounts are separately managed accounts for institutional investors, such as public and private pension funds, public funds, endowment funds and private investment funds. Institutional accounts also include sub-advised portfolios, such as registered investment companies, where we act as investment advisor but for which we have limited or no distribution responsibilities. Institutional accounts are typically offered directly by us through institutional consultants and through national and regional broker-dealers.
Managed accounts are separately managed accounts for high net worth investors offered primarily through national and regional broker-dealers. Managed accounts also include accounts for which we provide model portfolio design and oversight.
Our revenues are substantially comprised of investment management fees earned under contracts with the funds and separate accounts managed by us. The distribution of Total Assets among our investment products has an impact on our investment management fees, as some products carry different fees than others. Investment management fees may fluctuate based on a number of factors, including the following:
total value and composition of our Total Assets;
the amount of capital gain and income distributions;
market appreciation or depreciation;
the use of leverage within our closed-end products;
relative investment performance and volatility of our investment products and strategies compared to benchmarks and competitors;
level of net sales and redemptions, which represent the sum of new client assets, additional funding from existing clients, withdrawals of assets from and termination of client accounts, and purchases and redemptions of open-end fund shares;
a determination by the independent trustees of the funds to terminate or significantly alter the funds’ investment management agreements with us; and
Our revenues also are comprised of distribution and underwriting fees. Asset-based distribution and/or service fees received pursuant to Rule 12b-1 plans, discussed below, are a significant component of distribution and underwriting fees. Distribution and underwriting fees may fluctuate based on a number of factors, including the following:
total value of our assets under management;
total composition of our assets under management by share class;
market appreciation or depreciation; and
the level of purchases and redemptions.
Investment Management Fees
Investment management fees that we receive from funds for which we act as investment advisor are computed monthly on an average daily net asset value basis. Investment management fees that we earn on separate accounts for which we act as investment advisor are generally computed quarterly, either in advance or in arrears, based on the average Total Assets or Total Assets at the beginning or end of the quarterly period. We recognize the revenues derived from these fees over the period during which we render investment advisory services.
Distribution and Underwriting Fees
Distribution and underwriting fees include (1) asset-based distribution and/or service fees received pursuant to Rule 12b-1 plans, (2) front-end sales charges and (3) contingent deferred sales charges.
Rule 12b-1 distribution and/or service fees are asset-based fees that the open-end funds pay us over time pursuant to distribution plans adopted under provisions of Rule 12b-1 of the Investment Company Act. These fees are typically calculated as a percentage of average daily net assets in specific share classes of the open-end funds. These fees fluctuate with both the level of average daily net assets and the relative mix of assets among share classes. Rule 12b-1 fees are generally offset by distribution and service expenses paid during the period, as well as the amortization of deferred sales commissions that were previously paid by us to third parties.
We earn front-end sales charges on the sale of Class A shares of open-end funds, which provide for a sales charge at the time of investment. We retain a portion of the applicable sales charge and record as underwriting revenue only the portion that we retain. We retain the entire sales charge earned on accounts where Calamos Financial Services acts as the broker-dealer. Sales charges are waived on sales to shareholders or intermediaries that exceed specified minimum dollar amounts and other specified conditions. Sales charges fluctuate with both the level of Class A share sales and the mix of Class A shares offered with and without a sales charge.
Contingent deferred sales charges are earned on redemptions of Class B shares within six years of purchase and on redemptions of Class C shares within one year of purchase. Contingent deferred sales charges fluctuate primarily based on the length of the investment in Class B and Class C shares. Waivers of contingent deferred sales charges apply under certain circumstances.
Other revenues consist primarily of portfolio accounting fees, which are contractual payments calculated as a percentage of combined assets of the funds for financial accounting services, such as establishing expense accruals and performing tax calculations. The fees were calculated based on the average daily assets of the open-end and closed-end funds.
Our operating expenses consist of employee compensation and benefits, distribution expenses, amortization of deferred sales commissions, marketing and sales promotion expenses, and general and administrative expenses. These expenses fluctuate due to a number of factors, including but not limited to, the following:
variations in the level of total compensation expense due to, among other things, incentive compensation, changes in our employee count and mix and competitive factors;
changes in distribution expense and amortization of the deferred sales commissions as a result of fluctuations in open-end fund sales and level of redemptions;
market appreciation or depreciation of assets under management which will directly impact distribution expenses;
the amount of Rule 12b-1 distribution and/or service fees that we receive, as well as our continued ability to receive those fees in the future, which would affect the amortization expenses associated with the receipt of these fees;
changes in the level of our marketing and promotion expenses in response to market conditions, including our efforts to further penetrate and support new and existing distribution channels and clients; and
expenses and capital costs, such as technology assets, professional services, depreciation, and research and development, incurred to maintain and enhance our administrative and operating services infrastructure.
We have and will continue to adjust the level of expenses relative to business income and continue to seek opportunities to implement a more variable cost structure.
MANAGEMENT DISCUSSION FOR LATEST QUARTER
We are a firm of 364 full-time associates that primarily provides investment advisory services to institutions and individuals, managing and servicing $27.5 billion in Total Assets as of September 30, 2013 . Total Assets includes assets under management totaling $26.6 billion as well as model-based strategies totaling $844 million for separately managed accounts in which we provide model portfolio design and oversight.
Our operating results fluctuate primarily due to changes in the total value and composition of our Total Assets. The value and composition of our Total Assets are, and will continue to be, influenced by a variety of factors including: purchases and redemptions of shares of open-end funds; net inflows into and withdrawals from separate accounts that we manage; fluctuations in the financial markets around the world that result in appreciation or depreciation of Total Assets; and the number and types of our investment strategies and products.
We market our investment strategies to our clients through a variety of products designed to suit their investment needs. We currently categorize the portfolios that we manage within four investment product types captured in our Funds and separate accounts. The following table lists our Total Assets by product as of September 30, 2013 and 2012 .
Our revenues are substantially comprised of investment management fees earned under contracts with Funds and separate accounts that we manage or service. Our revenues are also comprised of distribution and underwriting fees, including asset-based distribution and/or service fees received pursuant to Rule 12b-1 plans. Investment management fees and distribution and underwriting fees may fluctuate based on a number of factors including: the total value and composition of our Total Assets; market appreciation and depreciation on investments; the level of net inflows and outflows, which represent the sum of new and existing client funding, withdrawals and terminations; and purchases and redemptions of open-end fund shares. The mix of Total Assets among our investment products impacts our revenues as our fee schedules vary by product.
Our largest operating expenses are typically related to: employee compensation and benefits expenses, which include salaries, incentive compensation and related benefits costs; distribution expenses, which include open-end funds distribution cost (such as Rule 12b-1 payments) and amortization of deferred sales commissions; and marketing and sales promotion expenses, which include expenses necessary to market products offered by us. Operating expenses may fluctuate due to a number of factors including variations in staffing and compensation, changes in distribution expense as a result of fluctuations in open-end fund net sales and market appreciation or depreciation, and marketing-related expenses that include supplemental distribution payments.
Third Quarter and Nine Months Ended September 30, 2013 Compared to Third Quarter and Nine Months Ended September 30, 2012
Total Assets decreased by $6.8 billion , or 20% , to $ 27.5 billion as of September 30, 2013 from $ 34.3 billion as of September 30, 2012 . Our Total Assets consisted of 79% Funds and 21% separate accounts as of September 30, 2013 and 75% Funds and 25% separate accounts as of September 30, 2012 .
Net redemptions in our Funds were $ 612 million in the third quarter of 2013 , compared to net redemptions of $ 901 million in the third quarter of 2012 . Net redemptions for the third quarter of 2013 were due largely to redemptions from our equity and lower-volatility equity funds. Net sales were strongest in our alternative funds, which had net sales of $264 million in the third quarter of 2013 . Market appreciation in all of our Funds totaled $ 1.3 billion in the third quarter of 2013 , a favorable change of $ 142 million from appreciation of $ 1.2 billion in the third quarter of 2012 .
Net redemptions in our Funds were $ 3.6 billion for the first nine months of 2013 and represent an unfavorable change of $ 2.1 billion from net redemptions of $ 1.5 billion in the first nine months of 2012 . The increase in net redemptions for the first nine months compared to the prior year was primarily a result of net redemptions in our equity and lower-volatility equity funds. Net sales were strongest in our alternative funds, which had net sales of $602 million in the first nine months of 2013 . Market appreciation in all of our Funds totaled $ 1.9 billion in the first nine months of 2013 and $ 2.2 billion in the first nine months of 2012 .
Separate accounts, which represent institutional and managed accounts, combined net redemptions were $ 368 million in the third quarter of 2013 , compared to net sales of $ 162 million in the third quarter of 2012 . Net redemptions in the first nine months of 2013 were $ 2.2 billion , compared to net sales in the first nine months of 2012 of $ 47 million . Separate accounts combined market appreciation was $ 477 million in the third quarter of 2013 , and $ 459 million in the third quarter of 2012 . Market appreciation was $ 741 million and $ 757 million in the first nine months of 2013 and 2012 , respectively.
Operating income for the third quarter of 2013 of $15.4 million decreased by $16.3 million , or 51% , from the third quarter of 2012 . Operating margin for the third quarter of 2013 decreased to 23.7% from 38.8% from the third quarter of 2012 . Operating income for the first nine months of 2013 decreased by 39% to $55.9 million from $91.7 million for the same period a year ago. Operating margin was 27.6% for the first nine months of 2013 , a decline from 36.7% for the first nine months of 2012 . The decrease in both operating income and operating margin is attributable to our decrease in investment management fees.
In order to grow Total Assets, we engage in distribution and underwriting activities, principally with respect to our family of open-end funds. When analyzing our business, we consider the result of these distribution activities on a net revenue basis as they are typically a result of a single open-end fund share purchase. Generally accepted accounting principles in the United States (“GAAP”) requires that we present these activities on a gross revenue basis, thus resulting in a reduction to our overall operating margin, as the margin on distribution activities is lower than the margins on the remainder of our business. While we do not adjust our margin for these activities on a net revenue basis, we believe the margin table below is useful for understanding the impact of distribution activities on our margin.
Net distribution fee margin varies by share class because each share class has different distribution and underwriting activities, which are described in our 2012 Annual Report on Form 10-K. Distribution fee revenues and the majority of distribution expenses vary with average open-end fund assets, while deferred sales commissions included in distribution expenses are typically amortized on a straight-line basis with adjustments made upon redemption of existing assets.
During the quarter ended March 31, 2013 , we changed the presentation of our consolidated statements of operations, classifying amortization of deferred sales commissions with distribution expenses. Amortization of deferred sales commissions has become immaterial, with the discontinuation of the sale of Class B shares, making the separate line presentation less meaningful to the financial users.
Total revenues decreased by $16.9 million , or 21% , to $65.0 million for the third quarter of 2013 from $81.8 million for the third quarter of 2012 . Total revenues decreased by $47.2 million , or 19% , to $202.6 million for the first nine months of 2013 from $249.8 million for the first nine months of 2012 .
Investment management fees decreased 20% in the third quarter of 2013 compared to the third quarter of 2012 , which was primarily due to a $6.7 billion, or 20%, decrease in average Total Assets for the same periods. Investment management fees from open-end funds decreased to $29.9 million for the third quarter of 2013 , from $39.7 million for the third quarter of 2012 , driven by a $4.7 billion decrease in average open-end fund assets. Investment management fees from our closed-end funds increased to $13.7 million for the third quarter of 2013 from $12.5 million for the third quarter of 2012 , due to a $508 million increase in average closed-end fund assets. Investment management fees from our separately managed accounts were $7.6 million for the third quarter of 2013 , a decrease from $12.2 million for the third quarter of 2012 . Investment management fees that we earned as a percentage of average Total Assets were 0.75% for the third quarter of 2013 compared to 0.76% for the third quarter of 2012 .
Investment management fees decreased 18% in the first nine months of 2013 compared to the first nine months of 2012 , which was primarily due to a $5.9 billion, or 17%, decrease in average Total Assets for the same periods. Investment management fees from open-end funds decreased to $94.8 million for the first nine months of 2013 , from $121.3 million for the first nine months of 2012 , driven by a $4.3 billion decrease in average open-end fund assets. Investment management fees from our closed-end funds increased to $39.8 million for the first nine months of 2013 from $37.2 million for the first nine months of 2012 , due to a $383 million increase in average closed-end fund assets. Investment management fees from our separately managed accounts were $25.3 million for the first nine months of 2013 , a decrease from $36.5 million for the first nine months of 2012 . Investment management fees that we earned as a percentage of average Total Assets were 0.75% for the first nine months of 2013 compared to 0.76% for the first nine months of 2012 .
Distribution and underwriting fees decreased by 22% in the third quarter of 2013 compared to the third quarter of 2012 , due to a decrease of 23% in average open-end fund assets for the same periods, across most share classes. Distribution and underwriting fees decreased by 22% in the first nine months of 2013 compared to the first nine months of 2012 , due to a decrease of 21% in average open-end fund assets for the same periods, across most share classes. The decrease in average open-end fund assets when compared to the prior year is largely due to net redemptions in our equity and lower-volatility equity funds.
Operating expenses decreased by $0.6 million and $11.4 million for the third quarter and first nine months of 2013 , respectively, reflecting decreases in distribution expenses, marketing and sales promotion expenses, and general and administrative expenses, partially offset by an increase in employee compensation and benefits expenses.
Employee compensation and benefits expenses increased by $3.7 million and $4.5 million for the third quarter and first nine months of 2013 , respectively, when compared to the third quarter and first nine months of 2012 . The increase in the third quarter of 2013, is due to an increase in equity compensation expenses, the impact of the planned departure of a senior executive, and an increase in base salaries and related benefits, partially offset by a decrease in incentive compensation expenses. The increase in the first nine months of 2013, is due to an increase in base salaries and related benefits, an increase in equity compensation expenses and the impact of the planned departure of a senior executive partially offset by lower incentive compensation expenses. Salary expenses increased primarily due to increases in the number of associates we employ in our investment team. While continuing to focus on expense management in most areas of our firm, we have and will continue to add talent and resources to our investment team during 2013 . The increase in equity compensation expenses for the third quarter of 2013 is primarily a result of an increase in outstanding awards and a reversal of expenses due to forfeitures in the comparative 2012 period. The increase in equity compensation expenses for the nine months of 2013 is primarily a result of a reversal of expenses due to forfeitures in the third quarter of 2012 and new awards granted. The decreases in incentive compensation expenses for both periods are primarily a result of lower investment performance.
Distribution expenses decreased by $3.0 million and $9.9 million for the third quarter and first nine months of 2013 , respectively, when compared to the third quarter and first nine months of 2012 . The decreases were primarily due to a reduction in average assets for open-end funds of 23% and 21% for the third quarter and first nine months of 2013 , respectively, which was across most share classes, as well as a decrease in amortization of deferred sales commissions of $227,000 and $1.5 million, for the respective periods.
Marketing and sales promotion decreased by $0.4 million and $3.0 million for the third quarter and first nine months of 2013 , respectively, when compared to the third quarter and first nine months of 2012 , largely the result of lower advertising expenses, reduced reimbursements of fund operating expenses that are above the expense cap, and lower supplemental distribution payments to distribution intermediaries. Supplemental distribution payments are positively correlated with the levels of open-end fund assets that we manage.
General and administrative expenses decreased by $0.9 million and $3.0 million for the third quarter and first nine months of 2013 , respectively, when compared to the third quarter and first nine months of 2012 . Many offsetting factors gave rise to the net decreases in expenses during the third quarter; however, the main drivers were a reduction in legal expenses and outsourcing of middle office function expenses. The main drivers to the decrease for the first nine months of 2013 were a reduction in outsourcing of middle office function expenses, client reimbursements related to trade correction expenses that were recorded in the first quarter of 2012 , and a decline in legal expenses.
Non-operating Activities, Net of Non-controlling Interest in Partnership Investments
Non-operating income, net of non-controlling interest in partnerships increased by $2.2 million and decreased by $13.5 million for the third quarter and first nine months of 2013 , respectively, when compared to the third quarter and first nine months of 2012 . The increase in the third quarter of 2013 was due to an increase in investment income of $2.4 million when compared to the third quarter of 2012, resulting from an increase in realized gains generated from tax harvesting activities and a decrease in losses on option contracts. The decrease in the first nine months of 2013 was due to a decrease in investment income of $13.7 million when compared to the first nine months of 2012 . The decrease in investment income was driven by a decrease in realized gains generated from tax harvesting activities and an other-than-temporary and an other-than-temporary impairment charge of $4.4 million recorded in the second quarter of 2013 on certain available-for-sale securities with unrealized losses held in the investment portfolio, offset by a decrease in losses on option contracts.
Our investment portfolio returned $25.9 million , or 6.3%, and returned $25.8 million, or 6.5%, in the third quarter and first nine months of 2013 , respectively. These results primarily reflect unrealized and realized gains from investment securities and realized losses on option contracts used to hedge market value fluctuations in our corporate investment portfolio.
Income Tax Provision
Calamos Investments LLC (“Calamos Investments”) is subject to certain income-based state taxes; therefore, income taxes reflect not only the portion attributed to us but also income taxes attributable to non-controlling interests. CAM's effective income tax rate for the third quarter and first nine months of 2013 was approximately 37.4% and 44.0% , respectively, compared to 36.2% and 44.9% for the third quarter and first nine months of 2012 .
The effective tax rates for the first nine months of 2013 and 2012, include the impact of an increase in the deferred tax valuation allowance of $ 900,000 and $ 1.9 million , respectively, to reduce CAM's deferred income tax assets to an amount that is more likely than not to be realized. Excluding the deferred tax valuation allowance, CAM's effective income tax rates would be 37.6% and 37.2% for the first nine months ended September 30, 2013 , and September 30, 2012, respectively.
As of September 30, 2013, the net deferred tax asset related to the capital loss carryforwards that expire in 2013 and 2014 was $2.2 million and the ultimate realization of this deferred tax asset is dependent upon the generation of sufficient capital gains prior to the expiration.
Net income attributable to CAM was $2.7 million and $7.8 million for the third quarter and first nine months of 2013 , respectively, compared to $4.7 million and $13.6 million for the third quarter and first nine months of 2012 . Non-GAAP net income attributable to CAM was $4.1 million and $13.7 million for the third quarter and first nine months of 2013 , respectively, compared to $6.5 million and $18.7 million for the third quarter and first nine months of 2012 . See “Supplemental Non-GAAP Financial Measures” below for descriptions of non-GAAP financial measures and a reconciliation of non-GAAP financial measures to GAAP financial measures.
The Calamos Interests has reserved the right to exchange its interest in Calamos Investments for newly issued Class A common shares. At the time of exchange, the Calamos Interests would be granted Class A common shares with a value equal to the fair value of its ownership in Calamos Investments. The method for determining the number of shares the Calamos Interests receive upon exchange is described in Section 3 (c) (ii) of Article IV of the Second Amended and Restated Certificate of Incorporation of CAM. Based upon the number of outstanding shares of Class A common stock at September 30, 2013 , and excluding the value of assets we own other than our 22.2% interest in Calamos Investments, such exchange would result in the Calamos Interests receiving 77.8% of CAM’s then outstanding Class A common stock.
Following a complete exchange of the Calamos Interests’ 77.8% ownership interest in Calamos Investments for newly issued Class A common stock, net income attributable to non-controlling interests in Calamos Investments would no longer be presented as a separate line item within our consolidated statements of operations because CAM would then own 100% of Calamos Investments.
Forward-looking statements are subject to risks and uncertainties and may differ materially from actual performance and results. Please see the forward-looking information and Risk Factors sections in our periodic report filed with the U.S. Securities and Exchange Commission. Non-GAAP financial measures help enhance an overall understanding of our financial results and facilitate comparisons of historical results. Please see the appendix for a reconciliation of GAAP and non-GAAP financial measures.
I would now like to turn over the call to John Calamos, Sr.
John P. Calamos, Sr.
Good afternoon and thank you for joining us on the Calamos Asset Management third quarter 2013 earnings call. Joining me today’s call is Nimish Bhatt, our Chief Financial Officer; also in the room is Christian Helmetag, our Corporate Controller. I will start the presentation with a business update, financial highlights and asset flows. Nimish will provide additional detail with respect to our financial results. And I will then conclude the formal part of the presentation and we’ll open the call to questions.
On Slide 4, we begin with the snapshot of our total assets, which were $27.5 billion as of September 30. The charts here show the total asset mix by strategy and by product category. As you can see on the left, equity represents 35%, lower-volatility equity is 22%, followed by enhanced fixed income at 12%. The next largest allocation is in our alternative strategies at 11%, followed by total return, convertible, high yield and fixed income. By product category, 50% of our total asset mix is in the open-ended funds followed by 22% in closed-end funds, 14% in our institutional strategies and 7% in managed accounts.
On Slide 5, we breakdown the some of the important developments for the quarter. Total assets increased from $20.6 billion to $27.5 billion, driven by market appreciation, offset by slower outflows. We experienced net outflows of $980 million for the quarter versus $2.3 billion last quarter. Flows are moving in the right direction and we are encouraged by this positive trend. We also saw positive flows of $264 million into our alternative strategies. We view these strategies as contributors to our growth going forward, as investors look to alternatives to invest in instead of bonds.
Our investment performance continues to improve in our growth strategies due to a number of factors including our more optimistic top down view, sector repositioning and significant additions to the talent within our Investment Team. We regularly evaluate our products to meet the evolving needs of our clients. We launched two new funds this quarter; the Calamos Dividend Growth Fund and the Calamos Mid Cap Growth Fund. We also reopened our flagship Calamos Convertible Fund, and the Calamos Evolving World Growth Fund marked its five-year anniversary.
This quarter, we enhanced our existing Investment Team resources, including two additional co-portfolio managers for fixed income and high yield. The company continues its commitment to maintain a strong balance sheet. Also Calamos Investments LLC repurchased 904,350 shares of Class A common stock for a total of $9.7 million during the first nine months of the year as part of our corporate share repurchase program. The repurchase program primarily allows the company to offset the dilution from the share issuance under our incentive comp program.