Retirement portfolio insights from our experts

Putnam's Portfolio Solutions Group can help you analyze
target-date funds and other investment options.

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Portfolio Solutions

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As investment products have proliferated, choosing retirement plan investment options has become more complicated. To help you analyze plan options more proactively, Putnam has launched the Portfolio Solutions Group. This team of seven investment professionals, skilled in asset allocation and risk management, has developed a proprietary modeling tool that provides institutional-level analysis of risk factors in a plan's investment options. They can also help you analyze potential alternatives upon request.

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Putnam can help you identify risks

Retirement plans can choose from thousands of investment options or encourage the use of widely diversified target-date funds. Given the broad range of potential choices, it can be challenging to understand all the underlying factors that drive investment performance and identify possible risks. For target-date funds in particular, it can be helpful to go beyond the breakdown of stocks and bonds to gain greater insight about performance drivers.

Below are examples of 10 key factors that can help explain absolute and relative investment performance.

Also compare and analyze target-date funds

Target-date funds offered by different asset managers provide diversification, but their risk factor exposures can be quite different. Putnam can help you compare managers and funds to see these differences.

Compare target-date funds in terms of risk factor exposures

We can provide a customized report comparing the factor exposures of target-date funds across the glide path, to shed light on where different managers take risk.

See how much different risk factors contribute to performance

We can provide a customized report comparing how factor exposures contribute to performance of target-date funds at different stages of the cycle of wealth accumulation and distribution.

Sources: Putnam Investments, MPI Stylus, Morningstar Direct.

Data is based on calculations of portfolio betas to each common factor, as well as historical observed returns, volatilities, and correlations between common factors. Refer to the appendix for additional information on historical strategy and risk information. Like the output of any model, this analysis may be subject to limitations, is not guaranteed, and may produce results that diverge from any client’s past or future performance. Past performance is not a guarantee of future results.

Putnam's Portfolio Solutions Group does not offer investment advice, and any analysis provided is not intended to make any recommendation or offer advice as to whether any investment or strategy is suitable for a particular investor. The analysis is intended to be an overview of potential types of reports that we can create for a client or model portfolio. The initial analysis focuses on the portfolio allocation. The objective is to provide in-depth understanding of the main drivers of return and risk in the portfolio. The methodology uses a risk-factor-based approach, and utilizes historical, index-based factor returns, volatilities, and correlations. Should an advisor wish to have alternative scenarios and consider potential portfolio changes, additional reports can be run on the revised portfolio, which can then be compared with the initial portfolio. However, the advisor or other recipient of this material must determine the lineup changes to be reflected in the model to generate the revised portfolio for illustration purposes.