Low Volatility Equity Fund  (PLVKX)

Pursuing returns comparable to the U.S. stock market, but with lower volatility over a market cycle


Track this fund

Objective

The fund seeks a total return comparable to that of the U.S. equity market, but with lower volatility, over a market cycle (generally at least three years or more).

Fund price

Yesterday’s close 52-week high 52-week low
Net asset value $11.74
0.00% | $0.00
$11.77
10/05/17
$10.40
11/04/16
Historical fund price

Fund facts as of 09/30/17

Total net assets
$26.21M
Turnover (fiscal year end)
47%
Dividend frequency
Annually
Number of holdings
148
Fiscal year end
July
CUSIP / Fund code
74676A592 / 1884
Inception Date
03/18/13
Category
Blend
Open to new investors
Ticker
PLVKX

Management team


Chief Investment Officer, Global Asset Allocation

Portfolio Manager

Strategy and process

  • Low-beta stocks: The fund invests in low-beta stocks, which have historically provided better risk-adjusted returns than the overall stock market.
  • Sector diversity: The fund seeks to capitalize on a diverse range of low-beta stocks across all sectors rather than simply overweighting low-beta sectors.
  • Option strategies: The veteran management team employs options strategies that can improve performance and reduce risk.

Literature

Fund documents

Fact Sheet (Y share) (PDF)
Prospectus (PDF)
Annual Report (PDF)
Semiannual Report (PDF)
Equity Outlook (PDF)
Capital Markets Outlook (PDF)

Why a meaningful near-term market correction is unlikely
2017 is a rare year without a stock market correction of at least 5%, but that doesn't make a correction more likely in the fourth quarter.
How the Japan election may influence global interest rates
The Japan election could have consequences for the future leadership of the Bank of Japan and the country's impact on global interest rate trends.
Avoiding retirement savings shortfalls requires a team effort
Plan features, employer match, deferral rates, and investor education all work together to help participants avoid retirement savings shortfalls.

Performance

  • Total return (%) as of 09/30/17

  • Annual performance as of 09/30/17

Annualized performance 1 yr. 3 yrs. 5 yrs. Life (inception: 03/18/13 )
Before sales charge 10.88% 4.62% -- 6.49%
After sales charge N/A N/A N/A N/A
S&P 500 Index 18.61% 10.81% 14.22% --

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. To obtain the most recent month-end performance, visit putnam.com. Performance assumes reinvestment of distributions and does not account for taxes. Returns before sales charge do not reflect the current maximum sales charges as indicated below. Had the sales charge been reflected, returns would be lower. Returns at public offering price (after sales charge) for class A and class M shares reflect the current maximum initial sales charges of 5.75% and 3.50% for equity funds and Putnam Absolute Return 500 Fund and 700 Fund, and 4.00% and 3.25% for income funds (1.00% and 0.75% for Putnam Floating Rate Income Fund, Putnam Absolute Return 100 Fund and 300 Fund, and Putnam Short-Term Municipal Income Fund), respectively. Class B share returns reflect the applicable contingent deferred sales charge (CDSC), which is 5% in the first year, declining to 1% in the sixth year, and is eliminated thereafter (except for Putnam Floating Rate Income Fund, Putnam Absolute Return 100 Fund and 300 Fund, and Putnam Short-Term Municipal Income Fund, which is 1% in the first year, declining to 0.5% in the second year, and is eliminated thereafter). Class C shares reflect a 1% CDSC the first year that is eliminated thereafter. Performance for class B, C, M, R, T1, and Y shares prior to their inception is derived from the historical performance of class A shares, adjusted for the applicable sales charge (or CDSC) and, except for class Y shares, the higher operating expenses for such shares (with the exception of Putnam Tax-Free High Yield Fund and Putnam AMT-Free Municipal Fund, which are based on the historical performance of class B shares). Class R5/R6 shares, 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 R5/R6 shares before their inception are derived from the historical performance of class Y shares, which have not been adjusted for the lower expenses; had they, returns would have been higher. Class A, M, and T1 shares of Putnam money market funds have no initial sales charge. For a portion of the period, some funds had expenses limitations or had been sold on a limited basis with limited assets and expenses, without which returns would be lower.

Performance snapshot

  Before sales charge After sales charge
1 mt. as of 09/30/17 1.57 % -
YTD as of 10/13/17 8.91 % -

Risk-adjusted performance as of 09/30/17

Alpha (3 yrs.) -1.03
Sharpe ratio (3 yrs.) 0.76
Treynor ratio (3 yrs.) 8.53
Information ratio (3 yrs.) -1.11

Volatility as of 09/30/17

Standard deviation (3 yrs.) 5.76%
Beta 0.51
R-squared 0.78

Capture ratio as of 09/30/17

Up-market (3 yrs.) 49.53
Down-market (3 yrs.) 56.90

Lipper rankings as of 09/30/17

Large-Cap Core Funds Percentile ranking Rank/Funds in category
1 yr. 97% 763/790
3 yrs. 98% 697/713
5 yrs.   --
10 yrs.   --

Morningstar ratings as of 09/30/17

Large Blend Rating Funds in category
Overall (477)
3 yrs. (1218)

Distributions

Record/Ex dividend date 12/07/16
Payable date 12/09/16
Income $0.199
Extra income $0.0
Short-term cap. gain --
Long-term cap. gain --

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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** FundVisualizer comparison based on Putnam fund versus the largest fund in its Morningstar category.


Holdings

Top 10 holdings as of 09/30/17

Johnson & Johnson 2.88%
JPMorgan Chase 2.51%
Pfizer 2.33%
Mcdonald'S Corp 2.02%
Apple 1.96%
Applied Materials 1.94%
Texas Instruments 1.91%
Raytheon 1.83%
UnitedHealth Group 1.81%
Pnc Financial Services Group The 1.77%
Top 10 holdings, percent of portfolio 20.96%

Full portfolio holdings as of 06/30/17

JOHNSON & JOHNSON 3.11%
JPMORGAN CHASE & CO 2.56%
PFIZER INC 2.33%
ALTRIA GROUP INC 2.16%
MCDONALD'S CORP 2.10%
APPLE INC 1.95%
UNITEDHEALTH GROUP INC 1.82%
EXXON MOBIL CORP 1.75%
PNC FINANCIAL SERVICES GROUP 1.75%
TEXAS INSTRUMENTS INC 1.74%
DANAHER CORP 1.69%
HUMANA INC 1.69%
EBAY INC 1.68%
RAYTHEON COMPANY 1.68%
INTUIT INC 1.67%
KIMBERLY-CLARK CORP 1.67%
APPLIED MATERIALS INC 1.64%
HONEYWELL INTERNATIONAL INC 1.60%
NORFOLK SOUTHERN CORP 1.59%
WALT DISNEY CO/THE 1.58%
NORTHROP GRUMMAN CORP 1.55%
CBS CORP-CLASS B NON VOTING 1.53%
TJX COMPANIES INC 1.41%
LOWES COMPANIES INC 1.37%
ZOETIS INC 1.37%
SHERWIN-WILLIAMS CO/THE 1.36%
AUTOMATIC DATA PROCESSING 1.34%
JUNIPER NETWORKS INC 1.18%
CVS HEALTH CORP 1.17%
ALLSTATE CORP 1.15%
ALPHABET INC-CL A 1.12%
AFLAC INC 1.09%
F5 NETWORKS INC 1.06%
GENERAL DYNAMICS CORP 1.05%
BAKER HUGHES INC 1.02%
KINDER MORGAN INC 1.02%
P G & E CORP 0.98%
BERKSHIRE HATHAWAY INC-CL B 0.97%
CME GROUP INC 0.97%
VERIZON COMMUNICATIONS INC 0.97%
FIDELITY NATIONAL INFO SERV 0.96%
MERCK & CO. INC. 0.89%
ROSS STORES INC 0.87%
MARATHON PETROLEUM CORP 0.86%
EQUITY RESIDENTIAL TR REIT 0.85%
EDISON INTERNATIONAL 0.81%
SYSCO CORP 0.81%
ADOBE SYSTEMS INC 0.77%
GREAT PLAINS ENERGY INC 0.77%
MICROSOFT CORP 0.75%
WASTE MANAGEMENT INC 0.75%
JM SMUCKER CO/THE 0.73%
TRAVELERS COS INC/THE 0.72%
AGNC INVESTMENT CORP 0.71%
HERSHEY CO/THE 0.71%
US BANCORP 0.70%
FISERV INC 0.69%
AMERICAN ELECTRIC POWER 0.65%
HARRIS CORP 0.65%
L3 TECHNOLOGIES INC 0.64%
NETAPP INC 0.62%
PAYCHEX INC 0.60%
SUNTRUST BANKS INC 0.60%
ANNALY CAPITAL MANAGEMENT IN 0.59%
AT&T INC 0.58%
VANTIV INC - CL A 0.56%
NVR INC 0.52%
PROCTER & GAMBLE CO/THE 0.52%
SYNOPSYS INC 0.47%
AVERY DENNISON CORP 0.44%
CDK GLOBAL INC 0.44%
WELLCARE HEALTH PLANS INC 0.43%
LEAR CORP 0.42%
PINNACLE FOODS INC 0.42%
VOYA FINANCIAL INC 0.42%
PHILLIPS 66 0.41%
REPUBLIC SERVICES INC 0.39%
EPR PROPERTIES 0.38%
GAMING AND LEISURE PROPERTIE 0.38%
PRICELINE GROUP INC/THE 0.38%
ALTABA INC 0.37%
ECOLAB INC 0.37%
SPY 20180615 P 210.00CITI 0.36%
CORNING INC 0.35%
CAMDEN PROPERTY TRUST 0.34%
SERVICEMASTER GLOBAL HOLDING 0.34%
HASBRO INC 0.32%
CONAGRA BRANDS INC 0.31%
LAMAR ADVERTISING CO-A 0.31%
SPY 20180518 P 210.00JPMCB 0.31%
STARWOOD PROPERTY TRUST INC 0.31%
BIO-RAD LABORATORIES-A 0.29%
CHIMERA INVESTMENT CORP 0.28%
SOUTHERN CO/THE 0.28%
REINSURANCE GROUP OF AMERICA 0.26%
HOME DEPOT INC 0.25%
BERRY GLOBAL GROUP INC 0.24%
SPY 20180420 P 205.00CITI 0.24%
TWENTY-FIRST CENTURY FOX-A 0.24%
AMERICAN HOME 4 RENT 0.23%
BWX TECHNOLOGIES INC 0.23%
SPIRIT REALTY CAPITAL INC 0.22%
AMDOCS LTD 0.21%
CORELOGIC INC 0.21%
DELL TECHNOLOGIES INC-CL V 0.21%
ULTA BEAUTY INC 0.21%
WALGREENS BOOTS ALLIANCE INC 0.21%
CORPORATE OFFICE PROPERTIES 0.20%
EURONET WORLDWIDE INC 0.20%
SPY 20180316 P 205.00JPMCB 0.20%
HIGHWOODS PROPERTIES INC 0.19%
TWO HARBORS INVESTMENT CORP 0.19%
RETAIL PROPERTIES OF AME - A 0.18%
SONOCO PRODUCTS CO 0.18%
BAXTER INTERNATIONAL INC 0.17%
GENPACT LTD 0.17%
LANDSTAR SYSTEM INC 0.17%
POOL CORP 0.17%
MFA FINANCIAL INC 0.16%
SCOTTS MIRACLE-GRO CO 0.16%
CHARLES RIVER LABORATORIES 0.15%
LIBERTY PROPERTY TRUST 0.15%
POPULAR INC 0.15%
ASSURED GUARANTY LTD 0.14%
BROADRIDGE FINANCIAL SOLUTIO 0.14%
HUNTINGTON INGALLS INDUSTRIE 0.14%
SPY 20180216 P 200.00CITI 0.14%
WORLD FUEL SERVICES CORP 0.14%
ARAMARK 0.13%
INTERCONTINENTAL EXCHANGE IN 0.13%
PEPSICO INC 0.13%
THERMO FISHER SCIENTIFIC INC 0.13%
APPLE HOSPITALITY REIT INC 0.11%
ASPEN INSURANCE HOLDINGS LTD 0.11%
BRANDYWINE REALTY TRUST 0.10%
EQUITY COMMONWEALTH 0.10%
COMMERCEHUB INC-SERIES C 0.09%
EMPIRE STATE REALTY TRUST-A 0.09%
GRAHAM HOLDINGS CO-CLASS B 0.09%
SPY 20180119 P 195.00JPMCB 0.09%
AMAZON.COM INC 0.08%
HEICO CORP 0.08%
PARK HOTELS & RESORTS INC 0.08%
QUALITY CARE PROPERTIES 0.08%
INTUITIVE SURGICAL INC 0.07%
MARRIOTT INTERNATIONAL -CL A 0.07%
LIBERTY EXPEDIA HOLD-A 0.06%
US FOODS HOLDING CORP 0.06%
CISCO SYSTEMS INC 0.05%
COLGATE-PALMOLIVE CO 0.05%
DAVITA INC 0.05%
NEWS CORP - CLASS B 0.05%
WILEY (JOHN) & SONS-CLASS A 0.05%
SPY 20170728 C 248.50CITI -0.01%

Prior top 10 holdings

Top 10 holdings as of 09/30/17
Johnson & Johnson
JPMorgan Chase
Pfizer
Mcdonald'S Corp
Apple
Applied Materials
Texas Instruments
Raytheon
UnitedHealth Group
Pnc Financial Services Group The
Holdings represent 20.96% of portfolio
Top 10 holdings as of 08/31/17
Johnson & Johnson
JPMorgan Chase
Pfizer
Apple
Mcdonald'S Corp
UnitedHealth Group
Raytheon
Texas Instruments
Altria Group
Humana
Holdings represent 21.38% of portfolio
Top 10 holdings as of 07/31/17
Johnson & Johnson
JPMorgan Chase
Pfizer
Mcdonald'S Corp
Apple
UnitedHealth Group
Altria Group
Texas Instruments
Pnc Financial Services Group The
Raytheon
Holdings represent 20.91% of portfolio
Top 10 holdings as of 06/30/17
Johnson & Johnson
JPMorgan Chase
Pfizer
Altria Group
Mcdonald's
Apple
UnitedHealth Group
Exxon Mobil
Pnc Financial Services Group
Texas Instruments
Holdings represent 21.27% of portfolio

Portfolio composition as of 09/30/17

Common stock 97.25%
Cash and net other assets 2.32%
Mutual Fund 0.43%

Equity statistics as of 09/30/17

Median market cap $24.90B
Weighted average market cap $89.20B
Price to book 3.12
Price to earnings 17.79

Fund characteristics will vary over time.

Due to rounding, percentages may not equal 100%.

Consider these risks before investing: Risks associated with derivatives include increased investment exposure (which may be considered leverage) and, in the case of over-the-counter instruments, the potential inability to terminate or sell derivatives positions and the potential failure of the other party to the instrument to meet its obligations. Stock prices may fall or fail to rise over time for several reasons, including general financial market conditions and factors related to a specific company issuer or sector. There may be times when stocks in the fund's portfolio exhibit higher volatility than we expect, are not correlated with market movements as we expect, or underperform the markets. By selling covered call options, the fund limits its opportunity to profit from an increase in the price of the underlying portfolio securities, but continues to bear the risk of a decline in the value of these securities. The fund also risks losing all or part of the cash paid for purchasing put options. You can lose money by investing in the fund.

Top Industry Sectors as of 09/30/17

Information technology 22.49%
Financials 13.67%
Health care 13.62%
Consumer discretionary 11.72%
Industrials 10.22%
Consumer staples 7.94%
Energy 4.69%
Real estate 3.76%
Utilities 3.34%
 
Other
8.55%
Materials 2.65%
Cash and net other assets 2.32%
Unclassified 2.00%
Telecommunication services 1.58%

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

Sectors will vary over time. Represents the equity portion of the portfolio.


Expenses

Expense ratio

Class A Class B Class C Class M Class Y
Total expense ratio 1.32% 2.07% 2.07% 1.82% 1.07%
What you pay† 1.11% 1.86% 1.86% 1.61% 0.86%

† The fund's expense ratio is taken from the most recent prospectus and is subject to change. What you pay reflects Putnam Management's decision to contractually limit expenses through 11/30/17

Sales charge/Dealer allowance

 Breakpoint Class A Class B Class C Class M Class Y
$0-$49,999 5.75% / 5.00% 0.00% / 4.00% 0.00% / 1.00% 3.50% / 3.00% --
$50,000-$99,999 4.50% / 3.75% 0.00% / 4.00% 0.00% / 1.00% 2.50% / 2.00% --
$100,000-$249,999 3.50% / 2.75% -- 0.00% / 1.00% 1.50% / 1.00% --
$250,000-$499,999 2.50% / 2.00% -- 0.00% / 1.00% 1.00% / 1.00% --
$500,000-$999,999 2.00% / 1.75% -- 0.00% / 1.00% 1.00% / 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 M Class Y
0 to 9 mts. 1.00% 5.00% 1.00% -- --
9 to 12 mts. 0.00% 5.00% 1.00% -- --
2 yrs. -- 4.00% 0.00% -- --
3 yrs. -- 3.00% 0.00% -- --
4 yrs. -- 3.00% 0.00% -- --
5 yrs. -- 2.00% 0.00% -- --
6 yrs. -- 1.00% 0.00% -- --
7+ yrs. -- 0.00% 0.00% -- --

Trail commissions

  Class A Class B Class C Class M Class Y
  0.25% 0.25% 1.00% 0.65% 0.00%
  NA NA NA NA NA
  NA NA NA NA NA

The S&P 500 Index is an unmanaged index of common stock performance. You cannot invest directly in an index.

Consider these risks before investing: Risks associated with derivatives include increased investment exposure (which may be considered leverage) and, in the case of over-the-counter instruments, the potential inability to terminate or sell derivatives positions and the potential failure of the other party to the instrument to meet its obligations. Stock prices may fall or fail to rise over time for several reasons, including general financial market conditions and factors related to a specific company issuer or sector. There may be times when stocks in the fund's portfolio exhibit higher volatility than we expect, are not correlated with market movements as we expect, or underperform the markets. By selling covered call options, the fund limits its opportunity to profit from an increase in the price of the underlying portfolio securities, but continues to bear the risk of a decline in the value of these securities. The fund also risks losing all or part of the cash paid for purchasing put options. You can lose money by investing in the fund.