Absolute return investing

Absolute return investing offers an alternative to traditional mutual funds that invest in stocks, bonds, or money market securities. By definition, absolute return strategies are independent of asset classes and can take steps to reduce market risk. Absolute return funds look for a wide variety of positive return opportunities and seek to reduce unwanted risks through the use of hedging strategies.

Over time, inflation can erode the real return of stocks, bonds, and cash

Inflation reduces purchasing power, including the future purchasing power of a portfolio’s investment returns. Putnam Absolute Return Funds can help to diversify portfolios for inflation risk. The funds pursue returns above inflation as measured by T-bills, using tools such as short-maturity strategies and interest-rate hedging with Treasury futures.

Source: Morningstar, 2011. Returns and inflation are annualized for the period 12/31/25–12/31/12. Stocks are represented by the Ibbotson S&P 500 Total Return Index. Bonds are represented by the Ibbotson U.S. Long-Term Government Bond Total Return Index. Cash is represented by the Ibbotson U.S. 30-day Treasury Bill Total Return Index. Inflation is represented by the Consumer Price Index. All indexes are unmanaged and measure broad sectors of the stock and bond markets. You cannot invest directly in an index. Performance of Putnam funds will differ. Past performance is not indicative of future results.