Alternating market leadership is a challenge for investors

Leaders in one year could be losers the next year.

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  • Large-Cap Growth Equities (LCG)
  • Small-Cap Growth Equities (SCG)
  • Large-Cap Value Equities (LCV)
  • Small-Cap Value Equities (SCV)
  • Large-Cap Core Equities (LCC)
  • Mid-Cap Core Equities (MCC)
  • International Equities (IE)
  • U.S. Bonds (AGG)
  • Cash


Data is historical. Past performance is not a guarantee of future results. Large-cap growth stocks are represented by the Russell 1000 Growth Index, which is an unmanaged index of capitalization-weighted stocks chosen for their growth orientation. Small-cap growth stocks are represented by the Russell 2000 Growth Index, which is an unmanaged index of those companies in the Russell 2000 Index chosen for their growth orientation. Large-cap value stocks are represented by the Russell 1000 Value Index, which is an unmanaged index of capitalization-weighted stocks chosen for their value orientation. Small-cap value stocks are represented by the Russell 2000 Value Index, which is an unmanaged index of those companies in the Russell 2000 Index chosen for their value orientation. Large-cap stocks are represented by the S&P 500 Index, which is an unmanaged index of common stock performance. Mid-cap stocks are represented by the Russell Midcap Index, an unmanaged index that measures the performance of the 800 smallest companies in the Russell 1000 Index. International stocks are represented by the MSCI EAFE Index (ND), which is an unmanaged index of international stocks from Europe, Australasia, and the Far East. U.S. bonds are represented by the Barclays U.S. Aggregate Bond Index, which is an unmanaged index used as a general measure of fixed-income securities. Cash is represented by the BofA Merrill Lynch U.S. 3-month T-Bill Index, which is an unmanaged index used as a general measure for money market or cash instruments.


Consider these risks before investing: The indexes and corresponding alternating market leadership chart represent various investment styles referred to in the three hypothetical scenarios. The asset allocation scenario represents an investment allocated across all nine indexes shown in the chart at left. It is not possible to invest directly in an index. All indexes are unmanaged and measure common sectors of the stock, growth, value, non-U.S., and bond indexes. Mutual fund performance may differ from the performance of the relevant index(es). Past performance does not indicate future results. This analysis has been figured on an annual basis. More recent returns may be lower or higher than those shown.

Securities indexes assume reinvestment of distributions and interest payments and do not take into account brokerage fees and taxes. Securities in the indexes do not match those in Putnam funds, and performance will differ. It is not possible to invest directly in an index.

International investing involves certain risks, such as currency fluctuations, economic instability, and political developments. Investments in small companies involve higher risk of volatility. The use of derivatives involves additional risks, such as the potential inability to terminate or sell derivatives positions and the potential failure of the other party to the instrument to meet its obligations. There is a risk that you may have more or less than the original amount invested when you sell your shares. Mutual 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, funds that invest in bonds have ongoing fees and expenses. Diversification does not guarantee a profit or ensure against loss. It is possible to lose money in a diversified portfolio.

Money market funds are not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other governmental agency. Although the fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in this fund.