Absolute Return

Modern strategies pursuing positive returns with lower volatility

Absolute return funds use specialized tools that seek to reduce specific risks.

Advantages of absolute return investing

  • Committed to more consistent results
  • Diversified across multiple investments
  • A philosophy of low volatility
Fixed Income Absolute Return Fund (PYTRX)

Seeks positive returns with a similar level of volatility

Multi-Asset Absolute Return Fund (PDMYX)

This fund received a Overall Morningstar Rating out of 248 funds in the Multialternative category based on total return as of 09/30/19

Putnam Fixed Income Absolute Return Fund is managed by members of Putnam's Fixed Income team.

16

years' experience working together at Putnam

27

years' average investment experience

D. William Kohli
CIO, Fixed Income | Industry since 1988

Paul D. Scanlon, CFA
Co-Head of Fixed Income | Industry since 1986

Michael V. Salm
Co-Head of Fixed Income | Industry since 1989

Albert Chan, CFA
Portfolio Manager | Industry since 2002

Two benefits of absolute return strategies

Putnam Absolute Return Funds have highly flexible strategies with modern tools that seek to hedge risk. They can help improve diversification and reduce volatility in traditional portfolios.

Improve diversification

The funds can provide a differentiated return stream, one that is unlike the performance of traditional stock and bond funds.

They are independent from traditional benchmarks and can pursue strategies that are not aligned with the direction of the stock or bond markets.

Reduce volatility

Absolute return funds can seek to mitigate specific types of risk, such as market volatility or interest-rate movements.

They have more flexibility than more traditional funds to use a variety of tools, including derivatives, to establish portfolio positioning and hedging strategies.

The Morningstar Rating™ for funds, or "star rating," is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and ten-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36 to 59 months of total returns, 60% five-year rating/40% three-year rating for 60 to 119 months of total returns, and 50% ten-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the ten-year overall star rating formula seems to give the most weight to the ten-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods. Ratings do not take into account the effects of sales charges and loads.