Floating Rate Income Fund (Class A)  (PFLRX)

An income fund that can benefit from higher interest rates

Highlights

Objective

The fund seeks high current income. Preservation of capital is a secondary goal.

Strategy and process

  • Floating-rate bank loans: The fund primarily invests in bank loans with yields that are set at a margin above short-term interest rates and adjust when rates change.
  • Guard against rising interest rates: Bank loans have historically performed well amid rising interest rates because their yields adjust higher and become more attractive.
  • Backed by team research: The fund's experienced managers select a diverse range of loans using careful credit research.

Fund price

Yesterday’s close 52-week high 52-week low
Net asset value $8.50
-0.12% | $-0.01
$8.66
02/01/18
$8.50
11/16/18
Historical fund price

Fund facts as of 10/31/18

Total net assets
$777.03M
Turnover (fiscal year end)
60%
Dividend frequency (view rate)
Monthly
Number of issues
259
Fiscal year-end
February
CUSIP / Fund code
746763481 / 0057
Inception date
08/04/04
Category
Taxable Income
Open to new investors
Ticker
PFLRX

Management team

Co-Head of Fixed Income
Portfolio Manager
Portfolio Manager


Manager commentary | Q3 2018

Floating rate bonds offer opportunity

Paul Scanlon, Co-Head of Fixed Income, explains why bank loans offer opportunity in a rising-rate environment.



Performance

Consistency of positive performance over five years

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

Performance shown above 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 see below.

12.52%

Best 5-year annualized return

(for period ending 12/31/13)


1.94%

Worst 5-year annualized return

(for period ending 09/30/11)


4.10%

Average 5-year annualized return


  • Total return (%) as of 09/30/18

  • Annual performance as of 09/30/18

Annualized Total return (%) as of 09/30/18

Annualized performance 1 yr. 3 yrs. 5 yrs. 10 yrs.
Before sales charge 4.23% 4.23% 3.20% 4.70%
After sales charge 3.19% 3.88% 2.99% 4.60%
S&P/LSTA Leveraged Loan Index 5.18% 5.31% 4.13% 6.15%

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. 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 Multi-Asset Absolute Return Fund, and 4.00% and 3.25% for income funds (2.25% and 0.75% for Putnam Short Duration Bond Fund and 1.00% and 0.75% for Putnam Floating Rate Income Fund, Putnam Fixed Income Absolute Return 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 Short Duration Bond Fund, Putnam Fixed Income Absolute Return 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, N, 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). Returns at public offering price (after sales charge) for class N shares reflect the current maximum initial sales charge of 1.50%. 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 10/31/18 -0.33 % -1.33 %
YTD as of 11/16/18 2.73 % 1.70 %

Yield

Distribution rate before sales charge
as of 11/16/18
4.48%
Distribution rate after sales charge
as of 11/16/18
4.44%
30-day SEC yield as of 10/31/18
(after sales charge)
4.22%

Risk-adjusted performance as of 10/31/18

Sharpe ratio (3 yrs.) 1.28
Information ratio (3 yrs.) -2.20

Volatility as of 10/31/18

Standard deviation (3 yrs.) 2.53%
Beta 1.01
R-squared 0.94

Lipper rankings as of 10/31/18

Time period Rank/Funds in category Percentile ranking
1 yr. 155/232 67%
3 yrs. 143/208 69%
5 yrs. 122/188 65%
10 yrs. 46/82 56%
Lipper category: Loan Participation Funds

Morningstar Ratings as of 10/31/18

Time period Funds in category Morningstar Rating
Overall 211
3 yrs. 211
5 yrs. 192
10 yrs. 82
Morningstar category: Bank Loan

Distributions

Accrual days 31
Accrual start date 10/01/18
Accrual end date 10/31/18
Payable date 10/31/18
Income $0.031711419
Extra taxable income --
Dividend frequency Monthly

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.


Holdings

Top 10 holdings as of 10/31/18

Cequel Communications 1.49%
Vistra Energy 0.98%
Bausch Health 0.98%
Transdigm 0.95%
Refinitiv 0.93%
Ss&C Tech Inc 0.90%
Altice Numericable 0.87%
Scientific Games 0.86%
DELL Technologies 0.86%
Asurion 0.83%
Top 10 holdings, percent of portfolio 9.65%

Full portfolio holdings as of 09/30/18

REFINITIV TLB L+375 06.0875 09/18/2025 0.95%
SCIENTIFIC GAMES TLB5 L+275 04.5390 08/14/2024 0.89%
DELL INTL TLB L+200 04.2500 09/07/2023 0.88%
ZEKELMAN TLB L+225 04.6230 06/14/2021 0.85%
SPRINT TLB L+250 04.7500 02/02/2024 0.84%
ORTHO-CLINICAL TLB L+325 06/01/2025 0.83%
AVAYA TLB L+425 06.4084 12/15/2024 0.82%
QUIKRETE TLB L+275 04.9922 11/15/2023 0.82%
CINEWORLD TLB L+250 04.2999 02/28/2025 0.81%
PPD TL L+250 04.7856 08/18/2022 0.81%
BRAND ENERGY TL L+425 06.5957 06/21/2024 0.78%
UNIVISION TLC5 L+275 04.9922 03/15/2024 0.74%
BWAY CORP TLB L+325 05.5814 04/03/2024 0.73%
DIVERSEY TL L+300 03.0000 09/06/2024 0.72%
RACKSPACE HOSTING INC L+300 05.3482 11/03/2023 0.72%
VERTIV TLB L+400 06.3126 11/15/2023 0.72%
USI INC TLB L+300 05.3861 05/16/2024 0.70%
CLEAR CHANNEL TLD L+675 08.9922 01/30/2019 0.69%
AIR MEDICAL TLB L+325 05.3826 04/28/2022 0.68%
NAVISTAR TLB L+350 04.7500 11/06/2024 0.68%
GATES GLOBAL TLB L+275 04.9922 03/31/2024 0.67%
AKZONOBEL TLB L+325 05.6164 09/20/2025 0.66%
CAESARS RESORT TL L+275 02.7500 12/22/2024 0.66%
CARAUSTAR TL L+550 07.8861 03/14/2022 0.66%
INFOR TLB6 L+275 03.7500 02/01/2022 0.66%
VALEANT PHARMA TLB L+300 05.1038 06/01/2025 0.66%
BEACON ROOFING TLB L+225 04.3826 01/02/2025 0.65%
CENTURYLINK TLB L+275 02.7500 01/31/2025 0.65%
GREEKTOWN TLB L+300 03.7500 04/25/2024 0.65%
MEDALLION MID TLB L+325 05.4922 10/30/2024 0.65%
TMS INTL TLB L+275 05.0356 08/14/2024 0.65%
WERNER TLB L+400 05.2583 07/24/2024 0.65%
YUM BRANDS TLB L+175 03.9147 04/03/2025 0.65%
ATOTECH TLB1 L+300 05.3861 01/31/2024 0.64%
CPG INTL TL L+375 05.0828 05/05/2024 0.64%
SFR GROUP SA TLB11 L+275 03.9062 07/18/2025 0.64%
SOLERA TLB L+275 04.7563 03/03/2023 0.64%
STERIGENICS TLB L+300 05.2422 05/15/2022 0.64%
BUILDERS FIRSTSOURCE L+300 05.3861 02/29/2024 0.63%
KINETIC CONCEPTS TLB L+325 04.2846 02/03/2024 0.63%
WIDEOPENWEST TLB L+325 05.4084 08/19/2023 0.63%
GOLDEN NUGGET TL L+275 04.9522 10/04/2023 0.62%
ALLIANT HOLD TLB L+300 05.3581 05/10/2025 0.61%
MULTIPLAN TLB L+275 05.1361 06/07/2023 0.61%
CHESAPEAKE ENERGY 1.5L L+750 08.5000 08/23/2021 0.60%
KRONOS TLB L+300 05.2225 11/01/2023 0.60%
HUSKY TLB L+300 05.2018 03/28/2025 0.59%
LPL HOLDINGS INC TLB L+225 03.6524 09/21/2024 0.59%
CHUCK E CHEESE'S TLB L+325 05.4922 02/14/2021 0.58%
GFL ENVIRONMENTAL TLB L+275 05.1050 05/31/2025 0.58%
BMC TLB L+425 06.5619 06/28/2025 0.57%
FREEDOM MORTGAGE TLB L+475 07.0356 02/23/2022 0.57%
TEMPO ACQUISITION TLB L+300 05.2422 05/01/2024 0.57%
VISTRA ENERGY TLB1 L+200 04.2422 08/04/2023 0.57%
CALPINE CONS FIN TL L+250 03.9770 01/15/2025 0.56%
BJ'S WHOLESALE TLB L+300 05.3380 02/03/2024 0.55%
CHARTER COMM TLB L+200 02.0000 04/30/2025 0.55%
COMMUNITY HEALTH TLH L+325 05.5626 01/27/2021 0.55%
NRG ENERGY TLB L+175 03.9725 06/30/2023 0.55%
VICI PROPERTIES TL L+200 04.2122 12/22/2024 0.55%
ALTRA INDUSTIAL TLB L+200 04.3861 09/26/2025 0.53%
BASS PRO TLB L+500 07.2422 09/25/2024 0.53%
STARS GROUP TLB L+350 05.8861 07/10/2025 0.53%
TRAVELPORT TLB L+250 04.5888 03/16/2025 0.53%
WEIGHT WATCHERS TLB L+475 07.1500 11/29/2024 0.53%
CLUBCORP TLB L+275 05.1116 09/18/2024 0.52%
FIRST DATA TL L+200 04.2122 04/26/2024 0.52%
GRIFOLS TLB L+225 03.2879 01/31/2025 0.52%
MGM GROWTH PROP TLB L+200 04.2225 03/25/2025 0.52%
PAREXEL TLB L+300 04.2350 09/27/2024 0.52%
RESTAURANT BRANDS TLB L+225 04.4922 02/17/2024 0.52%
SUDDENLINK TLB L+225 04.4922 07/28/2025 0.52%
TRANSDIGM INC TLE 04.5759 05/30/2025 0.52%
YONKERS RACING CORP L+325 05.5000 05/31/2024 0.52%
CALIFORNIA RESOURC TL L+475 06.9622 11/17/2022 0.51%
EAGLECLAW MID TL L+425 06.4922 06/30/2024 0.51%
EXTENDED STAY TLB L+200 04.3691 08/30/2023 0.51%
HUB INTL TLB L+300 05.3616 04/25/2025 0.50%
INTELSAT S.A. TLB3 L+375 05.9801 11/27/2023 0.50%
ORYX TLB L+325 05.2672 02/28/2025 0.50%
SS&C TECH TLB3 L+225 04.5172 04/16/2025 0.50%
CSC HOLDINGS TLB L+225 04.4084 06/15/2025 0.49%
DIAMOND RESORTS TLB L+375 05.0000 09/02/2023 0.48%
AIR METHODS TLB L+350 04.7964 04/21/2024 0.47%
ADS WASTE TLB L+225 04.4126 11/10/2023 0.46%
AMERICAN TRAFFIC SOL TLB L+375 05.7063 02/28/2025 0.46%
ATLANTIC BROADBAND TLB L+238 04.6172 08/02/2024 0.46%
CERIDIAN TLB L+325 05.5875 04/30/2025 0.46%
HD SUPPLY WATERWORKS TLB L+300 04.0000 08/01/2024 0.46%
LIONS GATE TLB L+225 04.4981 03/24/2025 0.46%
FORTERRA TL L+300 05.2422 10/25/2023 0.45%
KMG CHEMICALS TLB L+275 04.9922 06/15/2024 0.45%
MICROCHIP TECH TLB L+200 04.3194 05/29/2025 0.45%
ROBERTSHAW 1STL L+350 05.3725 02/15/2025 0.45%
TRANSDIGM INC TLF L+250 04.8525 06/09/2023 0.45%
TTM TECH INC TL L+250 04.7560 09/28/2024 0.44%
MEREDITH CORP TLB L+300 05.2422 01/31/2025 0.43%
REYNOLDS GROUP TL L+300 04.9922 02/05/2023 0.42%
GOLDMAN SACHS GROUP INC 04.0889 10/28/2027 0.41%
HCA INC 06.5000 02/15/2020 0.41%
JPMORGAN CHASE & CO 05.3000 12/29/2049 0.41%
BCP RENAISSANCE PARENT L+350 05.8424 10/31/2024 0.40%
CITIGROUP INC 03.7508 09/01/2023 0.40%
CVS HEALTH CORP 03.0471 03/09/2021 0.40%
KCA DEUTAG US FIN LLC L+675 09.0211 03/21/2023 0.40%
METRO-GOLDWYN-MAYER TL L+250 04.8119 07/03/2025 0.40%
MITSUBISHI UFJ FIN GRP USD 03.3943 09/13/2021 0.40%
NOVOLEX TL L+325 05.5060 06/22/2025 0.40%
PLANTRONICS TLB L+250 04.8178 06/01/2025 0.40%
SOLENIS 1STL L+400 06.3114 12/26/2023 0.40%
SYNIVERSE TL 1L L+500 07.1479 03/09/2023 0.40%
WESTERN DIGITAL TLB L+175 04.0925 04/29/2023 0.40%
ABC SUPPLY TLB L+200 04.3118 10/31/2023 0.39%
ADT/PRIME SECURITY TLB L+275 04.9922 05/02/2022 0.39%
CBS RADIO TLB1 L+275 04.9622 11/17/2024 0.39%
ENVISION HEALTHCARE TL L+375 09/28/2025 0.39%
FILTRATION GROUP TLB L+300 05.3118 03/29/2025 0.39%
IRON MOUNTAIN TLB L+175 04.0356 01/02/2026 0.39%
REVLON CONS TLB L+350 05.8126 09/07/2023 0.39%
WASTE INDUSTRIES TLB L+275 05.0800 09/28/2024 0.39%
FRONTIER COMMUNICAT L+375 06.0000 06/15/2024 0.38%
JO-ANN STORES TL L+500 07.5094 10/16/2023 0.38%
KEANE GROUP TLB L+375 06.0794 05/25/2025 0.38%
BERRY PLATICS TLQ L+200 04.1859 10/01/2022 0.37%
TRONOX FIN TLB L+300 04.3192 09/22/2024 0.37%
WELBILT TLB L+300 03.9811 03/03/2023 0.37%
BOYD GAMING TLB L+225 04.4174 09/15/2023 0.36%
ENERGY TRANSFER EQUITY L+200 04.2422 02/02/2024 0.36%
JACK OHIO FIN LLC/FI P/P 144A 06.7500 11/15/2021 0.35%
JC PENNEY TLB L+425 06.5672 06/23/2023 0.35%
TOWNSQUARE TLB L+300 05.2942 04/01/2022 0.35%
UFC 1STL L+325 05.5000 08/18/2023 0.34%
PQ CORP TLB L+250 04.7422 02/08/2025 0.33%
REXNORD TLB L+200 04.2422 08/21/2024 0.33%
VIRGIN MEDIA TLK L + 250 03.7449 01/15/2026 0.33%
VISTRA TLB2 L+225 04.4922 12/14/2023 0.33%
TRIDENT TPI HLDG INC L+325 05.4922 10/05/2024 0.32%
TRINSEO TLB L+200 04.3206 09/06/2024 0.32%
ASURION 2NDL L+600 07.5734 08/04/2025 0.31%
ASURION TLB6 L+300 05.2422 11/03/2023 0.31%
CAPITAL AUTO 2NDL L+600 08.2500 03/24/2025 0.31%
TALBOTS INC 1STL L+450 06.7422 03/19/2020 0.31%
FORMULA ONE TLB L+250 04.2700 02/01/2024 0.30%
MURRAY ENERGY TLB2 L+725 09.3259 04/17/2020 0.30%
THERMON TLB L+375 06.0060 10/30/2024 0.30%
CCC INFO 1STL L+300 05.2500 03/30/2024 0.29%
TEVA PHARMACEUTICALS NE USD 02.2000 07/21/2021 0.29%
HILTON WORLDWIDE TLB L+215 04.0977 10/25/2023 0.28%
INTELSAT JACKSON TLB4 L+450 06.7301 01/02/2024 0.28%
ISTAR INC TLB L+275 04.8929 06/28/2023 0.28%
MORGAN STANLEY 03.7416 10/24/2023 0.28%
ARCELORMITTAL USD 05.5000 03/01/2021 0.27%
BARCLAYS PLC USD 04.4505 08/10/2021 0.27%
BAUSCH HLTH COS INC P/P 144A 06.5000 03/15/2022 0.27%
CHARTER COMM OPT LLC/CAP 03.9858 02/01/2024 0.27%
KINDER MORGAN INC 03.6192 01/15/2023 0.27%
KRAFT HEINZ FOODS CO 03.1605 08/10/2022 0.27%
PLY GEM TLB L+375 06.0874 04/12/2025 0.27%
ALBERTSON'S LLC TLB5 L+300 04.3052 12/21/2022 0.26%
BANK OF AMERICA CORP 03.1105 02/05/2026 0.26%
CABLEVISION SYS CORP 08.0000 04/15/2020 0.26%
DELEK US HOLD TLB L+250 04.7018 03/30/2025 0.26%
DISH DBS CORP 05.8750 07/15/2022 0.26%
ELDORADO RESORTS TLB L+225 04.4091 04/17/2024 0.26%
FLORA FOOD TLB L+300 05.0573 07/02/2025 0.26%
HORSESHOE BALTIMORE TL L+400 05.2306 07/07/2024 0.26%
HOUSTON FUEL TLB L+275 05.0000 06/26/2025 0.26%
JO-ANN STORES 2NDL L+925 11.6038 05/21/2024 0.26%
LOTUS MIDSTREAM TLB L+325 05.6361 09/26/2025 0.26%
MISYS 2NDL L+725 08.4588 06/13/2025 0.26%
MODA MIDSTREAM TLB L+325 05.6361 09/25/2025 0.26%
NAI ENTERTAINMENT TLB L+250 04.7500 05/08/2025 0.26%
NEWFIELD EXPLORATION CO 05.7500 01/30/2022 0.26%
NUMERICABLE TLB12 L+369 05.8459 01/31/2026 0.26%
PENSKE AUTOMOTIVE GROUP 03.7500 08/15/2020 0.26%
REYNOLDS GRP ISS/REY P/P 144A 05.8392 07/15/2021 0.26%
ROYAL BK SCOTLND GRP PLC USD 03.9226 06/25/2024 0.26%
STEINWAY MUSIC TLB L+375 05.9084 02/15/2025 0.26%
TRIBUNE MEDIA TLB L+300 05.2422 01/27/2024 0.26%
WORLD KITCHEN TLB L+400 06.3431 05/02/2024 0.26%
APERGY TLB L+250 04.7500 05/09/2025 0.25%
CALIFORNIA RESOURCES L+1038 12.6172 12/31/2021 0.25%
GARDA WORLD TLB L+350 4.812870 05/26/2024 0.25%
MISYS 1STL L+350 05.8861 06/16/2024 0.25%
RIVERS PITTSBURGH LP P/P 144A 06.1250 08/15/2021 0.25%
ROBERTSHAW 2NDL L+800 09.8725 02/15/2026 0.25%
ZEP INC TLB L+400 06.3861 08/08/2024 0.25%
CAPITAL AUTO 1STL L+250 04.7500 03/24/2024 0.24%
ACADEMY SPORTS TLB L+400 06.2095 07/02/2022 0.23%
ASURION TLB7 L+300 05.2422 11/03/2024 0.23%
GATEWAY CASINO TLB L+300 05.0714 03/13/2025 0.23%
GREAT LAKES D&D 08.0000 05/15/2022 0.23%
NEIMAN MARCUS TL L+325 05.3703 10/25/2020 0.23%
PETSMART INC TLB L+300 04.2460 03/11/2022 0.23%
ALLY FINANCIAL INC 04.6250 05/19/2022 0.22%
BRIGGS & STRATTON CORPORATION 06.8750 12/15/2020 0.22%
BOMBARDIER INC P/P 144A 08.7500 12/01/2021 0.21%
CCC INFO 2NDL L+675 08.9922 03/31/2025 0.21%
COMMSCOPE TLB5 L+200 04.2422 12/29/2022 0.21%
WPX ENERGY INC 06.0000 01/15/2022 0.21%
J. CREW GROUP TL L+322 04.5142 03/05/2021 0.20%
JDA SOFTWARE TLB L+275 05.0870 10/12/2023 0.20%
KRONOS 2NDL L+825 10.5931 11/01/2024 0.20%
PLATFORM SPEC TLB6 L+300 05.2422 06/07/2023 0.20%
SS&C TECH TLB4 L+225 04.5172 04/16/2025 0.20%
VIDEOTRON LTD USD 05.0000 07/15/2022 0.20%
TALBOTS INC 2NDL L+850 10.7422 03/19/2021 0.19%
CREDIT SUISSE GRP AG P/P 144A 03.5743 06/12/2024 0.18%
PLATFORM SPEC TLB7 L+250 04.7422 06/07/2020 0.18%
ICAHN ENTER/FIN 06.0000 08/01/2020 0.16%
SYNIVERSE TL 2L L+900 11.1479 03/11/2024 0.16%
TRONOX BLOCKED TLB L+300 05.2422 09/22/2024 0.16%
AMERICAN TRAFFIC SOL 2NDL L+775 09.7063 02/28/2026 0.14%
ANTERO RESOURCES 05.3750 11/01/2021 0.14%
HUNTSMAN INTERNATIONAL LLC 04.8750 11/15/2020 0.14%
RANGE RESOURCES CORP 05.7500 06/01/2021 0.14%
SOLERA LLC / SOLERA P/P 144A 10.5000 03/01/2024 0.14%
AES CORP/THE 04.0000 03/15/2021 0.13%
BERRY PLASTICS TLR L+200 04.1859 01/19/2024 0.13%
BIG RIVER STEEL TLB L+500 07.3861 08/23/2023 0.13%
BLOUNT INTL TLB L+425 05.4921 04/12/2023 0.13%
CHESAPEAKE ENERGY CORP 05.5892 04/15/2019 0.13%
CIT GROUP INC 04.1250 03/09/2021 0.13%
CLEAR CHNL WORLD 07.6250 03/15/2020 0.13%
CNO FINANCIAL GROUP INC 04.5000 05/30/2020 0.13%
ISTAR INC 04.6250 09/15/2020 0.13%
MEG ENERGY TLB L+350 05.7500 12/31/2023 0.13%
NAVISTAR INTL CORP TLB L+375 06.0619 07/30/2025 0.13%
SABRE GLBL TLB L+200 03.9842 02/22/2024 0.13%
SS&C TECH TLB5 L+250 04.82225 04/16/2025 0.13%
TRAVERSE TLB L+400 05.0000 09/27/2024 0.12%
FIRST DATA TL L+200 04.2122 07/10/2022 0.11%
FRAC TECH INTL TLB L+475 07.1719 04/16/2021 0.11%
AMERICAN AXLE & MFG INC 07.7500 11/15/2019 0.10%
AVAYA HOLDINGS CORP 0.10%
INFOR SOFTWARE P/P 144A 07.1250 05/01/2021 0.10%
VISTRA ENERGY TLB3 L+200 04.1811 12/01/2025 0.10%
ZUFFA (UFC) 2NDL L+750 09.7422 08/18/2024 0.10%
GFL ENVIRONMENTAL DD L+275 05.1050 05/31/2025 0.07%
TRAVERSE TLB L+400 06.3388 09/27/2024 0.07%
VERRA MOBILITY TLB L+375 06.0971 03/01/2025 0.07%
AIR MEDICAL TLB L+425 06.4152 09/26/2024 0.06%
CHC GRP LLC/FIN P/P USD 00.0000 10/01/2020 0.06%
INFOR US INC 06.5000 05/15/2022 0.05%
ASCENT RESOURCES TLB L+650 08.6203 03/30/2023 0.04%
CAESARS ENTERTAINMENT CORP 0.04%
TRIBUNE CLASS 1C LITIGAT 0.03%
CHC GROUP LLC P/P 0.01%
TXU TCEH RIGHTS 0.01%
AVAYA INC ESCROW P/P 144A 07.0000 04/01/2019 0.00%
GETTY IMAGES TLB L+350 04.7500 10/18/2019 0.00%
INDUS CONT SERV TLB L+325 05.3300 04/28/2024 0.00%

Prior top 10 holdings

Top 10 holdings as of 10/31/18
Cequel Communications
Vistra Energy
Bausch Health
Transdigm
Refinitiv
Ss&C Tech Inc
Altice Numericable
Scientific Games
DELL Technologies
Asurion
Holdings represent 9.65% of portfolio
Top 10 holdings as of 09/30/18
Cequel Communications
Vistra Energy
Transdigm
Refinitiv
Bausch Health
Avaya Inc
Altice Numericable
Scientific Games
DELL Technologies
Asurion
Holdings represent 9.57% of portfolio
Top 10 holdings as of 08/31/18
Cequel Communications
Vistra Energy
Transdigm
Bausch Health
Avaya Inc
Scientific Games
DELL Technologies
Altice Numericable
Centurylink
Asurion
Holdings represent 9.48% of portfolio
Top 10 holdings as of 07/31/18
Cequel Communications
Vistra Energy
Transdigm
Bausch Health
Avaya Inc
Scientific Games
DELL Technologies
Altice Numericable
iHeartCommunications
Centurylink
Holdings represent 9.36% of portfolio

Fixed income statistics as of 10/31/18

Average effective maturity 5.05 yrs.
Average effective duration 0.20 yrs.
Average yield to maturity 5.96%
Average coupon 5.12%
Average price $99.74

Sector weightings as of 10/31/18

  Cash investments Non-cash investments Total portfolio
  Weight Spread duration Weight Spread duration Weight Spread duration
Bank loans 84.52% 3.72 0.00% 0.00 84.52% 3.72
Investment-grade corporate bonds 5.71% 0.19 0.00% 0.00 5.71% 0.19
High-yield corporate bonds 5.35% 0.11 0.00% 0.00 5.35% 0.11
Equity investments 0.08% 0.00 0.00% 0.00 0.08% 0.00
Convertible securities 0.05% 0.00 0.00% 0.00 0.05% 0.00
Net cash 4.29% 0.00 0.00% 0.00 4.29% 0.00

Spread duration is displayed in years and reflects the contribution by sector to the portfolio's total spread duration with the exception of the Treasury and Interest-rate swap sectors where effective duration is displayed. Spread duration estimates the price sensitivity of a specific sector or asset class to a 100 basis-point movement, 1%, (either widening or narrowing) in its yield spread relative to Treasuries. Effective duration provides a measure of a portfolio's interest-rate sensitivity. The longer a portfolio's duration, the more sensitive the portfolio is to shifts in the interest rates. Allocations may not total 100% of net assets because the table includes the notional value of derivatives (the economic value for purposes of calculating periodic payment obligations), in addition to the market value of securities.

Maturity detail as of 10/31/18

0 - 1 yr. 5.37%
1 - 5 yrs. 28.44%
5 - 10 yrs. 66.19%

Quality rating as of 10/31/18

A 2.68%
BBB 10.14%
BB 39.52%
B 40.33%
CCC and Below 2.87%
Not Rated 0.17%
Net cash 4.29%

Fund characteristics will vary over time.

Due to rounding, percentages may not equal 100%.

Consider these risks before investing: The value of securities in the fund’s portfolio may fall or fail to rise over time for several reasons, including general financial market conditions, changing market perceptions (including changing perceptions about the risk of default and expectations about monetary policy or interest rates), changes in government intervention, and factors related to a specific issuer or industry. These factors may also lead to periods of high volatility and reduced liquidity in the bond markets. Lower-rated bonds may offer higher yields in return for more risk. Bond investments are subject to interest-rate risk (the risk of bond prices falling if interest rates rise) and credit risk (the risk of an issuer defaulting on interest or principal payments). Interest-rate risk is greater for longer-term bonds, and credit risk is greater for below-investment-grade bonds. Unlike bonds, funds that invest in bonds have fees and expenses. 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. Floating-rate loans may reduce, but not eliminate, interest-rate risk. These loans are typically secured by specific collateral or assets of the issuer (holders of the loan, such as the fund, have a priority claim on those assets in the event of the issuer’s default or bankruptcy). Value of collateral may be insufficient to meet the issuer’s obligations, and the fund’s access to collateral may be limited by bankruptcy or other insolvency laws. You can lose money by investing in the fund.

Credit qualities are shown as a percentage of the fund's net assets. A bond rated BBB or higher (A-3 or higher, for short-term debt) is considered investment grade. This chart reflects the highest security rating provided by one or more of Standard & Poor’s, Moody’s, and Fitch. Ratings and portfolio credit quality will vary over time. Net cash, if any, represent the market value weights of cash, derivatives, and short-term securities in the portfolio. The fund itself has not been rated by an independent rating agency.

Top industry sectors as of 10/31/18

Consumer cyclicals 21.68%
Technology 11.12%
Basic materials 10.79%
Capital goods 9.69%
Financials 9.46%
Communication services 9.06%
Health care 8.72%
Energy 6.38%
Consumer staples 6.00%
 
Other
7.10%
Net Cash 4.29%
Utilities 2.81%

Allocations may not total 100% of net assets because the table includes the notional value of certain derivatives (the economic value for purposes of calculating periodic payment obligations), in addition to the market value of securities.

Sectors will vary over time.

Country allocation as of 10/31/18

United States 97.71%
United Kingdom 0.53%
Canada 0.40%
Japan 0.39%
Netherlands 0.28%
France 0.27%
Luxembourg 0.18%
Switzerland 0.18%
Cayman Islands 0.06%

Expenses

Expense ratio

Class A Class B Class C Class M Class R Class R6 Class Y
Total expense ratio 1.02% 1.22% 1.77% 1.07% 1.27% 0.68% 0.77%
What you pay 1.02% 1.22% 1.77% 1.07% 1.27% 0.68% 0.77%

Sales charge

Investment Breakpoint Class A Class B Class C Class M Class R Class R6 Class Y
$0-$49,999 1.00% 0.00% 0.00% 0.75% -- -- --
$50,000-$99,999 1.00% 0.00% 0.00% 0.75% -- -- --
$100,000-$249,999 1.00% -- 0.00% 0.75% -- -- --
$250,000-$499,999 1.00% -- 0.00% 0.75% -- -- --
$500,000-$999,999 0.00% -- -- -- -- -- --
$1M-$4M 0.00% -- -- -- -- -- --
$4M-$50M 0.00% -- -- -- -- -- --
$50M+ 0.00% -- -- -- -- -- --

CDSC

  Class A (sales for $500,000+) Class B Class C Class M Class R Class R6 Class Y
0 to 9 mts. 1.00% 1.00% 1.00% -- -- -- --
9 to 12 mts. 1.00% 1.00% 1.00% -- -- -- --
2 yrs. 0.00% 0.50% 0.00% -- -- -- --
3 yrs. 0.00% -- 0.00% -- -- -- --
4 yrs. 0.00% -- 0.00% -- -- -- --
5 yrs. 0.00% -- 0.00% -- -- -- --
6 yrs. 0.00% -- 0.00% -- -- -- --
7+ yrs. 0.00% -- 0.00% -- -- -- --

The S&P/LSTA Leveraged Loan Index is an unmanaged index of U.S. leveraged loans. The Barclays U.S. High Yield Loan Index is an unmanaged index that provides broad and comprehensive total return metrics of the universe of U.S. dollar denominated, syndicated term loans.You cannot invest directly in an index.

Consider these risks before investing: The value of securities in the fund’s portfolio may fall or fail to rise over time for several reasons, including general financial market conditions, changing market perceptions (including changing perceptions about the risk of default and expectations about monetary policy or interest rates), changes in government intervention, and factors related to a specific issuer or industry. These factors may also lead to periods of high volatility and reduced liquidity in the bond markets. Lower-rated bonds may offer higher yields in return for more risk. Bond investments are subject to interest-rate risk (the risk of bond prices falling if interest rates rise) and credit risk (the risk of an issuer defaulting on interest or principal payments). Interest-rate risk is greater for longer-term bonds, and credit risk is greater for below-investment-grade bonds. Unlike bonds, funds that invest in bonds have fees and expenses. 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. Floating-rate loans may reduce, but not eliminate, interest-rate risk. These loans are typically secured by specific collateral or assets of the issuer (holders of the loan, such as the fund, have a priority claim on those assets in the event of the issuer’s default or bankruptcy). Value of collateral may be insufficient to meet the issuer’s obligations, and the fund’s access to collateral may be limited by bankruptcy or other insolvency laws. You can lose money by investing in the fund.

Credit qualities are shown as a percentage of the fund's net assets. A bond rated BBB or higher (A-3 or higher, for short-term debt) is considered investment grade. This chart reflects the highest security rating provided by one or more of Standard & Poor’s, Moody’s, and Fitch. Ratings and portfolio credit quality will vary over time. Net cash, if any, represent the market value weights of cash, derivatives, and short-term securities in the portfolio. The fund itself has not been rated by an independent rating agency.