Putnam Capital Manager

Putnam Equity Income Subaccount

The subaccount seeks current income. Capital growth is a secondary objective when consistent with seeking current income.

Fund description

The subaccount employs Putnam's value strategy to invest primarily in stocks of large and mid-sized companies that are undervalued and poised for positive change. The subaccount favors dividend-paying companies and is broadly diversified across market sectors. To help manage volatility and increase current income, up to 20% of the portfolio can be invested in high quality, fixed-income securities.

Sales story

A multidimensional approach that defines value on a daily basisA large-value focus: The fund focuses on large companies whose stocks are priced below their long-term potential, and where there may be a catalyst for positive change.Dividend growth: The fund places a distinct emphasis on companies that can grow their dividends and are able and willing to return cash to shareholders.A disciplined process: The portfolio managers invest using fundamental research and quantitative tools supported by strong risk controls in portfolio construction.

Management team

Lipper ranking ‡ as of 07/31/19

Category: Equity Income Funds

  Percentile ranking Rank/Funds in category
10 yrs. 24% 13/54
1 yr. 57% 44/77
3 yrs. 24% 17/71
5 yrs. 29% 19/66

Risk Characteristics as of 07/31/19

Alpha (%) 1.59
Beta 0.98
R squared 0.96
Standard deviation (3 yrs.) 11.95

Mutual funds that invest in government securities are not guaranteed. Mortgage-backed securities are subject to prepayment risk. Capital gains, if any, are taxable for federal and, in most cases, state purposes. For some investors, investment income may be subject to the federal alternative minimum tax. Income from federally exempt funds may be subject to state and local taxes. Variable annuities are long-term investments designed for retirement purposes. Withdrawals prior to age 59 1/2 may be subject to a 10% IRS penalty.Although value investing targets stocks believed to be priced too low, there is no guarantee they will appreciate.

‡ Lipper is an industry research firm whose rankings are based on total return performance, vary over time, and do not reflect the effects of sales charges. Past performance is not indicative of future results.

Quick facts as of 07/31/19

Fiscal Year End December
Asset Class Putnam Capital Manager
Subaccount Status Open to new investors
Number of issues 109
Turnover (fiscal year end) 14%
Net Assets $1,396M
Inception Date 05/01/03

Holdings

Top 10 holdings as of 07/31/19

JPMorgan Chase 4.06%
Bank Of America Corp 3.38%
Microsoft Corp 2.97%
Citigroup 2.95%
Walmart 2.50%
Northrop Grumman Corp 2.22%
Johnson&Johnson 1.90%
Apple 1.67%
Exxon Mobil Corp 1.61%
Merck 1.56%
Top 10 holdings, total: 24.82%

Represents equity portion of portfolio.

Full Portfolio Holdings as of 06/30/19

JPMORGAN CHASE & CO 3.92%
MICROSOFT CORP 3.37%
BANK OF AMERICA CORP 3.19%
CITIGROUP INC 2.90%
WALMART INC 2.50%
NORTHROP GRUMMAN CORP 2.08%
JOHNSON & JOHNSON 2.03%
BECTON DICKINSON AND CO 1.74%
EXXON MOBIL CORP 1.66%
MERCK & CO. INC. 1.58%
APPLE INC 1.55%
AMERICAN ELECTRIC POWER 1.49%
AMERICAN TOWER CORP 1.49%
CONOCOPHILLIPS 1.49%
PROCTER & GAMBLE CO/THE 1.39%
ASSURED GUARANTY LTD 1.38%
CIGNA CORP 1.37%
UNION PACIFIC CORP 1.37%
CISCO SYSTEMS INC 1.37%
COMCAST CORP-CLASS A 1.36%
AT&T INC 1.33%
EXELON CORP 1.23%
AMERICAN INTERNATIONAL GROUP 1.22%
CHARTER COMMUNICATIONS INC-A 1.20%
ASTRAZENECA PLC-SPONS ADR 1.18%
AMGEN INC 1.18%
PEPSICO INC 1.17%
ABBVIE INC 1.16%
DANAHER CORP 1.15%
RAYTHEON COMPANY 1.14%
ELI LILLY & CO 1.14%
JOHNSON CONTROLS INTERNATION 1.12%
KKR & CO INC -A 1.12%
RADIAN GROUP INC 1.11%
BP PLC 1.10%
VALERO ENERGY CORP 1.08%
ENTERPRISE PRODUCTS PARTNERS 1.05%
NEXTERA ENERGY INC 1.05%
QUALCOMM INC 1.05%
HILTON WORLDWIDE HOLDINGS IN 1.03%
GAMING AND LEISURE PROPERTIE 1.03%
BALL CORP 1.02%
GILEAD SCIENCES INC 1.02%
FIDELITY NATIONAL INFO SERV 1.02%
AIR PRODUCTS & CHEMICALS INC 0.98%
ANADARKO PETROLEUM CORP 0.96%
WELLS FARGO & CO 0.95%
PFIZER INC 0.94%
BJ'S WHOLESALE CLUB HOLDINGS 0.92%
PNC FINANCIAL SERVICES GROUP 0.91%
GENERAL MOTORS CO 0.90%
TOTAL SA 0.89%
KROGER CO 0.88%
GOLDMAN SACHS GROUP INC 0.86%
HARTFORD FINANCIAL SVCS GRP 0.83%
HOME DEPOT INC 0.82%
NRG ENERGY INC 0.82%
FORTUNE BRANDS HOME & SECURI 0.81%
EDISON INTERNATIONAL 0.79%
APTIV PLC 0.76%
HONEYWELL INTERNATIONAL INC 0.76%
MOLSON COORS BREWING CO -B 0.75%
INTEL CORP 0.74%
SOUTHWEST AIRLINES CO 0.74%
BOSTON PROPERTIES INC 0.70%
KINDER MORGAN INC 0.69%
CAPITAL ONE FINANCIAL CORP 0.66%
DXC TECHNOLOGY CO 0.66%
BB&T CORP 0.63%
O'REILLY AUTOMOTIVE INC 0.63%
PULTEGROUP INC 0.62%
STATE STREET CORP 0.61%
TEXAS INSTRUMENTS INC 0.60%
ALCOA CORP 0.59%
VERIZON COMMUNICATIONS INC 0.58%
DUPONT DE NEMOURS INC 0.57%
KEYCORP 0.57%
DANAHER CORP 04.7500 CUM CV PFD 0.56%
STANLEY BLACK & DECKER INC 0.52%
EOG RESOURCES INC 0.52%
WALGREENS BOOTS ALLIANCE INC 0.50%
MARATHON OIL CORP 0.49%
FREEPORT-MCMORAN INC 0.48%
NXP SEMICONDUCTORS NV 0.45%
SCHWAB (CHARLES) CORP 0.42%
DOW INC 0.38%
HALLIBURTON CO 0.36%
EMERSON ELECTRIC CO 0.31%
ENCANA CORP 0.29%
MFA FINANCIAL INC 0.29%
COTY INC-CL A 0.28%
KEURIG DR PEPPER INC 0.26%
GENERAL ELECTRIC CO 0.24%
CORTEVA INC 0.23%
SHERWIN-WILLIAMS CO/THE 0.17%
OPORTUN FIN CORP P/P SERIES H PFD 0.04%
OPORTUN FIN G-1 PFD CV P/P 0.01%
OPORTUN FIN CORP P/P 0.01%
OPORTUN FIN F-1 PFD CV P/P 0.01%
TREASURY BILL 00.0000 08/13/2019 0.01%
TREASURY BILL 00.0000 07/25/2019 0.01%
GLOBAL FASHION GRP P/P 0.00%
GLOBAL FASHION GRP 0.00%
OPORTUN FIN F PFD CV P/P 0.00%
OPORTUN FIN C-1 PFD CV P/P 0.00%
OPORTUN FIN D-1 PFD CV P/P 0.00%
OPORTUN FIN B-1 PFD CV P/P 0.00%
OPORTUN FIN E-1 PFD CV P/P 0.00%
HC BRILLANT SERVICES GMBH P/P 0.00%
NEW BIGFOOT OTHER ASSETS GMBH P/P 0.00%
NEW MIDDLE EAST OTHER ASSETS GMBH P/P 0.00%
OPORTUN FIN A-1 PFD CV P/P 0.00%
EUR/USD 09/18/2019 BANKAM -0.00%
CAD/USD 07/17/2019 GSFX -0.00%
GBP/USD 09/18/2019 BCAP-FX -0.00%
GBP/USD 09/18/2019 GSFX -0.00%
CAD/USD 07/17/2019 CITI -0.00%
EUR/USD 09/18/2019 GSFX -0.00%
EUR/USD 09/18/2019 SSBT -0.01%

Prior top 10 holdings

Top 10 holdings as of 07/31/19
1: JPMorgan Chase 4.06%
2: Bank Of America Corp 3.38%
3: Microsoft Corp 2.97%
4: Citigroup 2.95%
5: Walmart 2.50%
6: Northrop Grumman Corp 2.22%
7: Johnson&Johnson 1.90%
8: Apple 1.67%
9: Exxon Mobil Corp 1.61%
10: Merck 1.56%
Holdings represent 24.82% of portfolio
Top 10 holdings as of 06/30/19
1: JPMorgan Chase 3.92%
2: Microsoft Corp 3.37%
3: Bank Of America Corp 3.19%
4: Citigroup 2.91%
5: Walmart 2.50%
6: Northrop Grumman Corp 2.08%
7: Johnson & Johnson 2.03%
8: BD Medical 1.74%
9: Danaher Corp 1.70%
10: Exxon Mobil Corp 1.66%
Holdings represent 25.10% of portfolio
Top 10 holdings as of 05/31/19
1: JPMorgan Chase 3.99%
2: Microsoft Corp 3.33%
3: Bank Of America Corp 3.13%
4: Citigroup 2.76%
5: Walmart 2.46%
6: Northrop Grumman Corp 2.08%
7: Johnson&Johnson 2.04%
8: BD Medical 1.72%
9: Danaher Corp 1.70%
10: Exxon Mobil Corp 1.64%
Holdings represent 24.85% of portfolio
Top 10 holdings as of 04/30/19
1: JPMorgan Chase 4.11%
2: Bank Of America Corp 3.40%
3: Microsoft Corp 3.28%
4: Citigroup 2.96%
5: Walmart 2.35%
6: Apple 2.10%
7: Johnson Johnson 2.08%
8: Northrop Grumman Corp 1.88%
9: Exxon Mobil Corp 1.77%
10: BD Medical 1.69%
Holdings represent 25.62% of portfolio

Portfolio Composition as of 07/31/19

Common stock 96.53%
Cash and net other assets 2.82%
Convertible preferred stock 0.65%

Allocations will vary over time. The unclassified sector (where applicable) includes exchange traded funds and other securities not able to be classified by sector.

Mutual funds that invest in government securities are not guaranteed. Mortgage-backed securities are subject to prepayment risk. Capital gains, if any, are taxable for federal and, in most cases, state purposes. For some investors, investment income may be subject to the federal alternative minimum tax. Income from federally exempt funds may be subject to state and local taxes. Variable annuities are long-term investments designed for retirement purposes. Withdrawals prior to age 59 1/2 may be subject to a 10% IRS penalty.Although value investing targets stocks believed to be priced too low, there is no guarantee they will appreciate.

Lipper is an industry research firm whose rankings are based on total return performance, vary over time, and do not reflect the effects of sales charges. Past performance is not indicative of future results.

Top Industry Sectors as of 07/31/19

Financials 22.47%
Health care 13.88%
Information technology 10.71%
Energy 10.37%
Industrials 9.38%
Consumer staples 8.52%
Utilities 5.07%
Consumer discretionary 4.66%
Communication services 4.46%
 
Other
10.48%
Materials 4.40%
Real estate 3.26%
Cash and net other assets 2.82%