Introducing Putnam Spectrum Funds, a type of Leveraged Company Stock Fund.

Opportunity in distressed securities

Portfolio Manager David Glancy explains why some of the most attractive opportunities are within distressed securities, and how it may be beneficial to invest across the capital structure.

Putnam Capital Spectrum Fund

Targets the total return potential of companies that use debt as a tool to improve their business performance. The fund manager has flexibility to select the most attractive securities in a company's capital structure, including common stocks, bonds, bank loans, and convertibles.

Putnam Equity Spectrum Fund

Targets the capital appreciation potential of stocks of companies that use debt as a tool to improve their business performance. Attracting little research coverage, stocks of leveraged companies can be significantly mispriced, offering the potential to outperform broad market averages.

About Portfolio Manager David Glancy

  • 22 years of experience as an analyst and manager of leveraged company securities
  • Career spans the history of leveraged investing, from the leveraged-buyout wave of the 1980s to the private equity wave of the 2000s and the credit crisis of today
  • Specialized skills to research corporate balance sheets and capital structures
  • Has participated in corporate reorganizations
Putnam Investments - A world of investing

Consider these risks before investing: The funds invest some or all of their assets in small and/or midsize companies with leveraged capital structures. Such investments increase the risk of greater price fluctuations.

The funds invest in relatively few issuers and involve more risk than funds that invest more broadly.

Funds that invest in securities of leveraged companies involve the risk that the securities of leveraged companies will be more sensitive to issuer, political, market, and economic developments than the market as a whole and the securities of other types of companies. Investments in securities of leveraged companies are likely to be more volatile than investments in companies that are not leveraged. The funds may focus investments in types of securities — equities, fixed income, or bank loans — that underperform relative to, or are more volatile than, other types of securities.

Funds that engage in short sales of securities may incur losses if the securities appreciate in value and may experience higher volatility due to leverage resulting from investing the proceeds of securities sold short. When short-selling, investors sell borrowed shares, hoping to repurchase them at a lower price before returning them to the lender.

Additional risks associated with Putnam Capital Spectrum Fund: Funds that invest in bonds are subject to certain risks including interest-rate risk, credit risk, and inflation risk. As interest rates rise, the prices of bonds fall. Long-term bonds are more exposed to interest-rate risk than short-term bonds. Unlike bonds, bond funds have ongoing fees and expenses. Lower-rated bonds may offer higher yields in return for more risk. Mortgage-backed securities are subject to prepayment risk.

Putnam Retail Management