Webcast | Demonstrating results in sustainable investing | March 18, 2021

Active Sustainability

Sustainable Future Fund (Class Y)  (PMVYX)

“Now more than ever, we believe that sustainable companies could also prove to be more resilient and beneficial than others over the long term.”

— Katherine Collins

Investing in companies improving our world

Manager commentary: Solid long-term returns backed by rigorous sustainability research
Sustainable Future Fund (PMVYX)

Mental health: Insights and potential investment implications

The Impact of COVID-19 pandemic on mental health.

In June 2020, the CDC found 41% of respondents reported an adverse mental health condition, with 31% suffering from anxiety or depression.

Read our research (PDF)

Highlights

Objective

The fund seeks long-term capital appreciation.

Strategy and process

  • Impact companies The fund invests in companies we believe have strong fundamentals that offer potential solutions to key sustainability challenges.
  • Active strategy A framework grounded in fundamental research and focused on impact-oriented sustainability solutions drives investment decisions.
  • Experienced team An experienced, dedicated sustainable investing team is integrated with Putnam's equity research and quantitative/risk analysis groups.

Fund price

 Yesterday’s close 52-week high 52-week low
Net asset value $27.43
0.81% | $0.22 		$27.88
02/12/21 		$19.94
06/15/20
(Optional)

Consistency of positive performance over five years

Performance represents 5-year returns in rolling quarter-end periods since inception.

Performance shown does not reflect the effects of any sales charges. Note that returns of 0.00% are counted as positive periods. For complete fund performance, please click on the performance tab.

26.06%

Best 5-year annualized return

(for period ending 03/31/14)

-5.20%

Worst 5-year annualized return

(for period ending 03/31/09)

9.72%

Average 5-year annualized return

Fund facts as of 05/31/21

Total net assets
$609.43M
Turnover (fiscal year end)
72%
Dividend frequency
Annually
Number of holdings
78
Fiscal year-end
April
CUSIP / Fund code
746802198 / 1856
Inception date
04/02/02
Category
Growth
Open to new investors
Ticker
PMVYX

Management team

Katherine Collins, CFA, MTS

Head of Sustainable Investing

Stephanie Dobson

Portfolio Manager

Literature

How BDCs can help in changing equity markets
Many features, including the potential for high yields, make BDCs a good counterweight to equity market volatility.
New medicines and digital tools target mental health
In recent years, there have been several developments for treating mental health. These innovations — which come after decades of slower-paced advances — include novel drugs and digital offerings.
Mental health is a business issue: How companies are supporting their employees
Companies are beginning to focus more on mental health at work, and some are offering a wider range of supportive and preventive care.

Performance

  • Total return (%) as of 03/31/21

  • Annual performance as of 03/31/21

Annualized Total return (%) as of 03/31/21

Annualized performance 1 yr. 3 yrs. 5 yrs. 10 yrs.
Before sales charge 86.03% 24.70% 18.48% 14.33%
After sales charge N/A N/A N/A N/A
Russell Midcap Growth Index 68.61%19.41%18.39%14.11%
Russell 3000V-Russell MidcapG Linked Benchmark 68.61%19.41%16.62%13.24%

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 loss when you sell your shares. Performance assumes reinvestment of distributions and does not account for taxes. The "before sales charge" performance does not reflect the current maximum sales charges, which we explain below. If performance did reflect the charges, it would be lower. The "after sales charge" performance (or returns at public offering price) varies by share class and fund. For class A and class M shares, the current maximum initial sales charges are 5.75% and 3.50% for equity funds and 4.00% and 3.25% for income funds, respectively (with these exceptions: 2.25% for class A of Putnam Floating Rate Income Fund, Short-Term Municipal Income, Short Duration Bond Fund, and Fixed Income Absolute Return Fund). Class B share performance reflects the applicable contingent deferred sales charge (CDSC), which is 5% in the first year, declines to 1% in the sixth year, and is eliminated thereafter (except for Putnam Floating Rate Income Fund, Putnam Short Duration Bond Fund, Putnam Fixed Income Absolute Return Fund, and Putnam Short-Term Municipal Income Fund; for these funds, the CDSC is 1% in the first year, declines to 0.5% in the second year, and is eliminated thereafter). Class C share performance reflects a 1% CDSC the first year that is eliminated thereafter. Performance for class B, C, M, N, R, and Y shares prior to their inception is derived from the historical performance of class A shares by adjusting for the applicable sales charge (or CDSC) and, except for class Y shares, the higher operating expenses for such shares (note, for two funds — Putnam Tax-Free High Yield Fund and Putnam Strategic Intermediate Municipal Fund performance prior to inception is based on the historical performance of class B shares). Performance for class A, C, R6, and Y shares of Putnam Mortgage Opportunities Fund before their inception is derived from the historical performance of class I shares, which has been adjusted for the applicable sales charge (or CDSC) and the higher operating expenses for such shares. The "after sales charge" performance (at public offering price) for class N shares reflects the current maximum initial sales charge of 1.50%. Class R, R3, R4, R5, and R6 shares, which are available to qualified employee-benefit plans only, are sold without an initial sales charge and have no CDSC. Class Y shares are generally only available for corporate and institutional clients and have no initial sales charge. Performance for class R3 and R4 shares prior to their inception is derived from the historical performance of class Y shares by adjusting for the higher operating expenses for such shares. Performance for class R5 shares before their inception is derived from the historical performance of class Y shares, which has not been adjusted for the lower expenses; had it been adjusted, performance would be higher (with the exception of the RetirementReady Maturity, 2025, 2030, 2035, and 2040 Funds, for which performance is derived from the historical performance of class R6 shares and has been adjusted for the higher operating expenses for such shares; and the RetirementReady 2045, 2050, 2055, and 2060 Funds, for which performance is derived from the historical performance of class R6 shares and has not been adjusted for the lower expenses; had it been adjusted, performance would be higher). Performance for class R6 shares before their inception is derived from the historical performance of class Y shares, which has not been adjusted for the lower operating expenses; had it been adjusted, performance would be higher. For a portion of the period, some funds had expenses limitations or had been sold on a limited basis with limited assets and expenses. Had these limits not been in place, performance would be lower.

Performance snapshot

  Before sales charge After sales charge
1 mt. as of 05/31/21 -1.77% -
YTD as of 06/14/21 8.46% -

Risk-adjusted performance as of 04/30/21

Alpha (3 yrs.) 6.33
Sharpe ratio (3 yrs.) 1.27
Treynor ratio (3 yrs.) 27.64
Information ratio (3 yrs.) 0.98

Volatility as of 04/30/21

Standard deviation (3 yrs.) 19.75%
Beta 0.91
R-squared 0.96

Capture ratio as of 04/30/21

Up-market (3 yrs.) 101.05
Down-market (3 yrs.) 83.53

Lipper rankings as of 04/30/21

Time period Rank/Funds in category Percentile ranking
1 yr. 94/496 19%
3 yrs. 106/457 24%
5 yrs. 260/399 65%
10 yrs. 133/264 51%
Lipper category: Multi-Cap Growth Funds

Morningstar Ratings™ as of 04/30/21

Time period Funds in category Morningstar Rating™
Overall 1168
3 yrs. 1168
5 yrs. 1049
10 yrs. 779
Morningstar category: Large Growth

Distributions

Record/Ex dividend date 12/04/20
Payable date 12/08/20
Income --
Extra income --
Short-term cap. gain $1.084
Long-term cap. gain $1.44

Lipper rankings are based on total return without sales charge relative to all share classes of funds with similar objectives as determined by Lipper. Past performance is not indicative of future results.

The Morningstar RatingTM 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 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

The up-market capture ratio is used to evaluate how well an investment manager performed relative to an index during periods when that index has risen. The ratio is calculated by dividing the manager’s returns by the returns of the index during the up-market, and multiplying that factor by 100. The down-market capture ratio is used to evaluate how well an investment manager performed relative to an index during periods when that index has dropped. The ratio is calculated by dividing the manager’s returns by the returns of the index during the down-market and multiplying that factor by 100.

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Holdings

Danaher Corp 3.23%
Adobe 2.75%
First Republic Bank/Ca 2.52%
Applied Materials 2.39%
Msci 2.21%
Chipotle Mexican Grill 2.14%
Crowdstrike Holdings 2.13%
Thermo Fisher Scientific 2.12%
Dynatrace 2.01%
Edwards Lifesciences Corp 1.96%
Top 10 holdings, percent of portfolio 23.46%

Portfolio composition as of 04/30/21

Common stock 95.18%
Cash and net other assets 3.72%
Convertible preferred stock 1.10%

Equity statistics as of 04/30/21

Median market cap $20.10B
Weighted average market cap $54.62B
Price to book 5.72
Price to earnings 39.82

Fund characteristics will vary over time.

Due to rounding, percentages may not equal 100%.

Consider these risks before investing: The value of investments in the fund's portfolio may fall or fail to rise over extended periods of time for a variety of reasons, including general economic, political, or financial market conditions; investor sentiment and market perceptions; government actions; geopolitical events or changes; and factors related to a specific issuer, geography, industry, or sector. These and other factors may lead to increased volatility and reduced liquidity in the fund's portfolio holdings. Growth stocks may be more susceptible to earnings disappointments, technological obsolescence, falling prices and profits, and the market may not favor growth-style investing. Investments in small and midsize companies increase the risk of greater price fluctuations. International investing involves currency, economic, and political risks. Emerging-market securities have illiquidity and volatility risks. The fund's sustainable and environmental, social, and/or corporate governance (ESG) investment strategy may result in the fund investing in certain types of companies, industries or sectors that the market may not favor. From time to time, the fund may invest a significant portion of its assets in companies in one or more related industries or sectors, which would make the fund more vulnerable to adverse developments affecting those industries or sectors. In evaluating an investment opportunity, we may make investment decisions based on information and data that is incomplete or inaccurate. Due to changes in the products or services of the companies in which the fund invests, the fund may temporarily hold securities that are inconsistent with its sustainable investment criteria. Our investment techniques, analyses, and judgments may not produce the outcome we intend. The investments we select for the fund may not perform as well as other securities that we do not select for the fund. We, or the fund's other service providers, may experience disruptions or operating errors that could have a negative effect on the fund. You can lose money by investing in the fund.

Top industry sectors as of 04/30/21

Information technology 28.76%
Health care 27.22%
Industrials 9.41%
Materials 8.19%
Financials 8.07%
Consumer discretionary 7.70%
Cash and net other assets 3.72%
Consumer staples 3.24%
Communication services 2.30%
 
Other		 1.39%
Utilities 1.39%

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

Sectors will vary over time.

Expenses

Expense ratio

 Class A Class B Class C Class R Class R6 Class Y
Total expense ratio 1.07% 1.82% 1.82% 1.32% 0.68% 0.82%
What you pay 1.07% 1.82% 1.82% 1.32% 0.68% 0.82%

Sales charge

 Breakpoint Class A Class B Class C Class R Class R6 Class Y
$0-$49,999 5.75% / 5.00% 0.00% / 4.00% 0.00% / 1.00% -- -- --
$50,000-$99,999 4.50% / 3.75% 0.00% / 4.00% 0.00% / 1.00% -- -- --
$100,000-$249,999 3.50% / 2.75% -- 0.00% / 1.00% -- -- --
$250,000-$499,999 2.50% / 2.00% -- 0.00% / 1.00% -- -- --
$500,000-$999,999 2.00% / 1.75% -- 0.00% / 1.00% -- -- --
$1M-$4M 0.00% / 1.00% -- -- -- -- --
$4M-$50M 0.00% / 0.50% -- -- -- -- --
$50M+ 0.00% / 0.25% -- -- -- -- --

CDSC

  Class A (sales for $1,000,000+) Class B Class C Class R Class R6 Class Y
0 to 9 mts. 1.00% 5.00% 1.00% -- -- --
9 to 12 mts. 1.00% 5.00% 1.00% -- -- --
2 yrs. 0.00% 4.00% 0.00% -- -- --
3 yrs. 0.00% 3.00% 0.00% -- -- --
4 yrs. 0.00% 3.00% 0.00% -- -- --
5 yrs. 0.00% 2.00% 0.00% -- -- --
6 yrs. 0.00% 1.00% 0.00% -- -- --
7+ yrs. 0.00% 0.00% 0.00% -- -- --

Trail commissions

  Class A Class B Class C Class R Class R6 Class Y
  0.25% 0.25% 1.00% 0.50% 0.00% 0.00%
  NA NA NA NA NA NA
  NA NA NA NA NA NA

For sales and trail commission information on purchases over $1 million and participant-directed qualified retirement plans, see a Putnam fund prospectus and the statement of additional information.

The Russell Midcap Growth Index is an unmanaged index of those companies in the Russell Midcap Index chosen for their growth orientation. The Russell 3000 Value Index is an unmanaged index of those companies in the broad-market Russell 3000 Index chosen for their value orientation. The Russell 3000 Value - Russell Midcap Growth Linked Benchmark represents performance of the Russell 3000 Value Index through March 20, 2018 and performance of the Russell Midcap Growth Index thereafter. You cannot invest directly in an index.

Consider these risks before investing: The value of investments in the fund's portfolio may fall or fail to rise over extended periods of time for a variety of reasons, including general economic, political, or financial market conditions; investor sentiment and market perceptions; government actions; geopolitical events or changes; and factors related to a specific issuer, geography, industry, or sector. These and other factors may lead to increased volatility and reduced liquidity in the fund's portfolio holdings. Growth stocks may be more susceptible to earnings disappointments, technological obsolescence, falling prices and profits, and the market may not favor growth-style investing. Investments in small and midsize companies increase the risk of greater price fluctuations. International investing involves currency, economic, and political risks. Emerging-market securities have illiquidity and volatility risks. The fund's sustainable and environmental, social, and/or corporate governance (ESG) investment strategy may result in the fund investing in certain types of companies, industries or sectors that the market may not favor. From time to time, the fund may invest a significant portion of its assets in companies in one or more related industries or sectors, which would make the fund more vulnerable to adverse developments affecting those industries or sectors. In evaluating an investment opportunity, we may make investment decisions based on information and data that is incomplete or inaccurate. Due to changes in the products or services of the companies in which the fund invests, the fund may temporarily hold securities that are inconsistent with its sustainable investment criteria. Our investment techniques, analyses, and judgments may not produce the outcome we intend. The investments we select for the fund may not perform as well as other securities that we do not select for the fund. We, or the fund's other service providers, may experience disruptions or operating errors that could have a negative effect on the fund. You can lose money by investing in the fund.