Not FDIC
Insured
May Lose
Value
No Bank
Guarantee
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A BALANCED APPROACH
A WORLD OF INVESTING
A COMMITMENT TO EXCELLENCE
281219 1/13
5/13
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Markets demand new ways of
thinking
• Stock market volatility has increased since 2007
• Bonds and cash offer low yields and limited upside
• Better portfolio diversification may be possible with
Putnam Absolute Return Funds
Diversification does not assure a profit or protect against loss. It is possible to lose money in a diversified portfolio.
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Frequent market volatility argues
for reducing equity risk
• Stock market volatility has worsened in recent years
Higher
Stock volatility index
9/11
Iraq
War
Lehman
Brothers
bankruptcy
Hurricane
Katrina
S&P cuts U.S.
credit rating
European
debt crisis
90
80
70
60
50
40
30
20
10
Lower
September March
2001
2003
August
2005
September
2008
0
December
2012
Source: CBOE Market Volatility Index, June 2000–December 2012.
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Bonds may offer limited upside
• Bond yields are at low levels, and vulnerable to inflation
(%) 5.0
Bond yields and inflation as of March 2013
4.0
3.0
2.0
1.0
0.0
Aaa-rated bond
10-year Treasury
Inflation
Sources: U.S. Federal Reserve (Moody’s Aaa-rated corporate bond, 10-year Treasury constant maturity); U.S. Bureau of Labor
Statistics Consumer Price Index 12-month change.
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Cash is safe, but lacks growth
• The Fed is holding down short-term interest rates
“This exceptionally low range for the
federal funds rate will be appropriate
at least as long as the unemployment
rate remains above 6.5%.”
Source: Federal Reserve’s Open Market Committee, March 20, 2013.
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Are there mutual
funds that seek
more consistent
returns with less
volatility?
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Putnam
Absolute Return
100 Fund®
Putnam
Absolute Return
300 Fund®
Putnam
Absolute Return
500 Fund®
Putnam
Absolute Return
700 Fund®
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What is
absolute
return
investing?
A strategy that
targets positive
returns above
inflation with less
volatility than
markets.
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Absolute return versus traditional
relative return strategies
Absolute return
Relative return
Defines success as achieving
positive returns
Defines success as beating a
benchmark, even if negative
Seeks low volatility and limited
market risk
Sets no absolute volatility targets
Independent of traditional
benchmarks
Tied to a benchmark index
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Putnam was the first to offer
a suite of absolute return funds
Seeks to
outperform
T-bills by
Invests in
Alternative to
Putnam Absolute Return
100 Fund
1%
Global fixed-income sectors
Short-term
securities
Putnam Absolute Return
300 Fund
3%
Global fixed-income sectors
Bond funds
Putnam Absolute Return
500 Fund
5%
Global fixed-income sectors,
stocks, and alternative assets
Balanced funds
Putnam Absolute Return
700 Fund
7%
Global fixed-income sectors,
stocks, and alternative assets
Stock funds
Each fund seeks to earn a positive total return that exceeds the rate of inflation by a targeted amount over a reasonable period of time (typically 3 years)
regardless of market conditions. There can be no assurance that a fund will meet its objective.
The funds are not intended to outperform stocks and bonds during strong market rallies.
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How Putnam manages
absolute return
1
2
3
4
Wide range
of global
securities
Progressive
risk
management
Ultimate
flexibility
Experienced
management
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The funds have delivered positive returns
in turbulent markets
As of 3/31/13
Inception: 12/23/08
1 year
before
sales
charge
1 year
after
sales
charge
3 years
before
sales
charge
3 years
after
sales
charge
Life
before
sales
charge
Life
after
sales
charge
Absolute Return 100 Fund®
1.74%
0.72%
0.82%
0.48%
1.56%
1.33%
0.65%
0.65%
Absolute Return 300 Fund®
4.53
3.48
1.97
1.63
3.39
3.15
0.82
0.82
Absolute Return 500 Fund®
4.70
-1.32
4.11
2.08
5.40
3.95
1.17
1.15
Absolute Return 700 Fund®
5.92
-0.17
4.95
2.90
7.05
5.58
1.31
1.31
BofA Merrill Lynch U.S.
Treasury Bill Index
0.14
—
0.15
—
0.19
—
—
—
Class A shares
before sales charge
Expense What
ratio
you pay
Current performance may be lower or higher than the quoted past performance, which cannot guarantee future results. Share price, principal value, and return will vary, and
you may have a gain or a loss when you sell your shares. The class A share performance shown assumes reinvestment of distributions and does not account for taxes.
Before-sales-charge returns do not reflect a maximum load of 5.75% for Putnam Absolute Return 500 and 700 Funds, and 1.00% for Putnam Absolute Return 100 and 300
Funds. Had the sales charges been reflected, returns would have been lower. “What you pay” reflects Putnam Management’s decision to contractually limit expenses
through 6/30/14. For a portion of the periods, the funds had expense limitations, without which returns would have been lower. A short-term trading fee of 1% may apply to
redemptions or exchanges from certain funds within the time period specified in the funds’ prospectus. To obtain the most recent month-end performance, visit putnam.com.
The BofA Merrill Lynch U.S. Treasury Bill Index is an unmanaged index that tracks the performance of U.S. dollar-denominated U.S. Treasury bills publicly
issued in the U.S. domestic market. Qualifying securities must have a remaining term of at least one month to final maturity and a minimum amount
outstanding of $1 billion.
It is not possible to invest directly in an index.
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Conditions favor risk strategies
• Solid corporate earnings and Fed’s quantitative
easing policy provide supportive conditions
• Economic uncertainty may resurface
• Potential policy missteps remain a risk
• The funds continue to underweight interest-rate risk
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Absolutely for all kind of investors
• Talk with your financial advisor to set your goals
• Review your portfolio and risk profile
• Add Putnam Absolute Return Funds to diversify
a portfolio of traditional funds
• The funds have provided low-volatility performance
in the up and down markets since 2008
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Putnam
Absolute Return
100 Fund®
Putnam
Absolute Return
300 Fund®
Putnam
Absolute Return
500 Fund®
Putnam
Absolute Return
700 Fund®
An alternative
to short-term
securities
An alternative
to bond funds
An alternative
to balanced funds
An alternative
to stock funds
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Consider these risks before investing:
Our allocation of assets among permitted asset categories may hurt performance. The prices of stocks and bonds in the fund’s
portfolio may fall or fail to rise over extended periods of time for a variety of reasons, including both general financial market
conditions and factors related to a specific issuer or industry. You can lose money by investing in the fund. Our active trading
strategy may lose money or not earn a return sufficient to cover associated trading and other costs. Our use of leverage obtained
through derivatives increases these risks by increasing investment exposure. Bond investments are subject to interest-rate risk,
which means the prices of the fund’s bond investments are likely to fall if interest rates rise. Bond investments also are subject to
credit risk, which is the risk that the issuer of the bond may default on payment of interest or principal. Interest-rate risk is
generally greater for longer-term bonds, and credit risk is generally greater for below-investment-grade bonds, which may be
considered speculative. Unlike bonds, funds that invest in bonds have ongoing fees and expenses. Lower-rated bonds may offer
higher yields in return for more risk. Funds that invest in government securities are not guaranteed. Mortgage-backed securities
are subject to prepayment risk. International investing involves certain risks, such as currency fluctuations, economic instability,
and political developments. Additional risks may be associated with emerging-market securities, including illiquidity and
volatility. Our use of derivatives may increase these risks by increasing investment exposure (which may be considered leverage)
or, in the case of many over-the-counter instruments, because of the potential inability to terminate or sell derivatives positions
and the potential failure of the other party to the instrument to meet its obligations. The funds may not achieve their goal, and
they are not intended to be a complete investment program. The funds’ effort to produce lower volatility returns may not be
successful and may make it more difficult at times for the funds to achieve their targeted return. In addition, under certain
market conditions, the funds may accept greater volatility than would typically be the case, in order to seek their targeted return.
For the 500 Fund and 700 Fund, these risks also apply: REITs involve the risks of real estate investing, including declining
property values. Commodities involve the risks of changes in market, political, regulatory, and natural conditions. Additional
risks are listed in the funds’ prospectus.
The views and opinions expressed are those of the speaker, are subject to change with market conditions, and are not meant as
investment advice.
Investors should carefully consider the investment objectives, risks, charges, and expenses of a fund before
investing. For a prospectus, or a summary prospectus if available, containing this and other information
for any Putnam fund or product, call your financial advisor or contact Putnam at 1-800-225-1581.
Investors should read the prospectus carefully before investing.
Putnam Retail Management
putnam.com
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