Floating Rate Income Fund  (PFLRX)

An income fund that can benefit from higher interest rates

Objective

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

Fund price

Yesterday’s close 52-week high 52-week low
Net asset value $8.62
0.12% | $0.01
$8.65
01/19/17
$8.57
11/14/16
Historical fund price

Fund facts as of 09/30/17

Total net assets
$836.59M
Turnover (fiscal year end)
49%
Dividend frequency (view rate)
Monthly
Number of issues
270
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

Strategy and process

  • Floating-rate bank loans: The fund invests in bank loans with yields that are set at a margin above short-term interest rates and adjust when rates change.
  • Protection from 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.

Literature


Longevity and medical costs – education for the great unknowns
Understanding the impact of longevity and medical costs on savings requires education and a proactive approach to saving.
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.

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)


4.22%

Average 5-year annualized return


  • Total return (%) as of 09/30/17

  • Annual performance as of 09/30/17

Annualized performance 1 yr. 3 yrs. 5 yrs. 10 yrs.
Before sales charge 3.90% 2.97% 3.39% 3.38%
After sales charge 2.86% 2.62% 3.18% 3.28%
S&P/LSTA Leveraged Loan Index 5.29% 3.87% 4.09% 4.72%

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 0.44 % -0.57 %
YTD as of 10/19/17 2.71 % 1.68 %

Yield

Distribution rate before sales charge
as of 10/20/17
3.84%
Distribution rate after sales charge
as of 10/20/17
3.80%
30-day SEC yield as of 09/29/17
(after sales charge)
3.49%

Risk-adjusted performance as of 09/30/17

Sharpe ratio (3 yrs.) 0.94
Information ratio (3 yrs.) -1.44

Volatility as of 09/30/17

Standard deviation (3 yrs.) 2.87%
Beta 0.99
R-squared 0.95

Lipper rankings as of 09/30/17

Loan Participation Funds Percentile ranking Rank/Funds in category
1 yr. 70% 161/230
3 yrs. 68% 140/207
5 yrs. 56% 88/158
10 yrs. 59% 38/64

Morningstar ratings as of 09/30/17

Bank Loan Rating Funds in category
Overall (209)
3 yrs. (209)
5 yrs. (158)
10 yrs. (64)

Distributions

Accrual days 29
Accrual start date 09/01/17
Accrual end date 09/29/17
Payable date 09/29/17
Income $0.02759899
Extra taxable income $0.0
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 09/30/17

Cequel Communications 1.25%
Scientific Games 1.17%
Caesars Entertainment Corp 1.11%
Transdigm 0.98%
Brand Holdings 0.97%
Univision Communications Inc 0.96%
Ortho-Clinical Diagnostics 0.93%
Sprint Communications 0.90%
Community Health Systems 0.88%
Valeant Pharmaceuticals International 0.85%
Top 10 holdings, percent of portfolio 10.00%

Full portfolio holdings as of 06/30/17

BRAND ENERGY TL L+425 05.4910 06/21/2024 0.94%
UNIVISION TLC5 L+275 03.9761 03/15/2024 0.94%
ORTHO-CLINICAL TLB L+375 05.0464 06/30/2021 0.91%
SPRINT TLB L+250 03.7500 02/02/2024 0.88%
CHESAPEAKE ENERGY 1.5L L+750 08.5000 08/23/2021 0.82%
BWAY CORP TLB L+325 04.4739 04/03/2024 0.80%
QUIKRETE TLB L+275 03.9761 11/15/2023 0.77%
REVLON CONS TLB L+350 04.7261 09/07/2023 0.77%
ENERGY TRANSFER EQ TL L+275 02.7500 02/02/2024 0.74%
PPDI TL L+275 04.0134 08/18/2022 0.74%
CERIDIAN TLB2 L+350 04.7261 09/15/2020 0.72%
RACKSPACE TLB L+300 04.1723 11/03/2023 0.72%
DELL INTERNATIONAL LLC L+250 03.5373 09/07/2023 0.71%
SFR GROUP SA TLB11 L+275 03.9062 06/22/2025 0.71%
SOLERA HOLDINGS TLB L+325 04.4761 03/03/2023 0.71%
VERTIV TLB L+400 05.2261 11/30/2023 0.71%
MEG ENERGY TLB L+350 04.6960 12/31/2023 0.70%
BUILDERS FIRSTSOURCE L+300 04.2964 02/29/2024 0.69%
CLEAR CHANNEL TLD L+675 07.9761 01/30/2019 0.69%
COMMUNITY HEALTH TLH L+300 04.2077 01/27/2021 0.69%
CSC HOLDINGS TLB L+225 03.2439 06/15/2025 0.69%
SCIENTIFIC GAMES TLB3 L+400 05.1078 10/01/2021 0.69%
ENDO PHARMA TLB L+425 05.5000 04/27/2024 0.67%
KMG CHEMICALS TLB L+425 05.4089 06/15/2024 0.65%
PATHEON TLB L+325 04.5044 04/20/2024 0.65%
VALEANT PHARMA TLBF1 L+475 05.9800 04/01/2022 0.65%
MULTIPLAN TLB L+300 04.2964 06/07/2023 0.64%
NAVISTAR TLB L+400 05.2300 08/07/2020 0.64%
NEIMAN MARCUS TL L+325 04.4744 10/25/2020 0.64%
SINCLAIR BROADCASTING TLB2 L+225 03.2473 01/31/2024 0.64%
CAESARS GROWTH PROP TL L+300 04.2261 05/08/2021 0.62%
GATES GLOBAL TLB L+325 04.5464 03/31/2024 0.61%
GETTY IMAGES TLB L+350 04.7500 10/18/2019 0.61%
NRG ENERGY TLB L+225 03.0283 06/30/2023 0.61%
YONKERS RACING CORP L+325 04.4800 05/31/2024 0.61%
ASSOC ASPHALT TLB L+525 06.4761 04/05/2024 0.60%
CITYCENTER TLB L+250 03.7156 04/18/2024 0.60%
INFOR TLB6 L+275 03.7500 02/01/2022 0.60%
CPG INTL TL L+375 05.0464 05/03/2024 0.59%
GREEKTOWN TLB L+300 03.7500 04/25/2024 0.59%
JO-ANN STORES TL L+500 06.0000 10/21/2023 0.59%
LPL HOLDINGS TLB L+250 03.5622 03/10/2024 0.59%
RESTAURANT BRANDS TLB L+225 03.5035 02/17/2024 0.59%
WIDEOPENWEST TLB L+350 04.7018 08/19/2023 0.59%
YUM BRANDS TLB L+200 03.2094 06/16/2023 0.59%
ALLIANT HOLD TL L+325 04.4165 08/14/2022 0.58%
CENTURYLINK TLB 138 01.3750 01/15/2025 0.58%
DIAMOND RESORTS TLB L+600 07.2261 09/02/2023 0.58%
STERIGENICS TLB L+300 04.1498 05/15/2022 0.58%
AKORN INC TLB L+425 05.5000 04/16/2021 0.57%
CASELLA WASTE TLB L+275 03.9594 10/17/2023 0.57%
CCC INFO 1STL L+300 04.2300 03/30/2024 0.57%
TMS INTL TLB L+350 04.6717 10/16/2020 0.57%
AIR MEDICAL TLB L+350 04.4738 04/28/2022 0.56%
INTELSAT JACKSON TLB2 L+275 04.0003 06/30/2019 0.56%
KINETIC CONCEPTS TLB L+325 04.2846 02/03/2024 0.56%
STEINWAY MUSIC 1STL L+375 04.7500 09/19/2019 0.55%
CHUCK E CHEESE'S TLB L+300 04.2261 02/14/2021 0.54%
FREEDOM MORTGAGE TLB L+550 06.5565 02/23/2022 0.54%
KRONOS TLB L+350 04.6804 11/01/2023 0.54%
TRAVELPORT TLB L+325 04.4318 09/02/2021 0.54%
DYNEGY TLC L+325 04.4761 02/07/2024 0.53%
WERNER TLB L+400 05.0000 06/22/2024 0.53%
ACADEMY SPORTS TLB L+400 05.1964 07/02/2022 0.52%
JELD-WEN TLB L+300 04.2964 07/01/2022 0.52%
LIGHTOWER TLB L+325 04.5464 04/13/2020 0.52%
SYNCHRONOSS TLB L+275 03.7718 01/19/2024 0.52%
TEMPO ACQUISITION TLB L+300 04.2272 05/01/2024 0.52%
UNIVAR INC TLB L+275 03.6083 07/01/2022 0.52%
COVERIS TLB L+350 04.6468 05/08/2019 0.50%
FIRST DATA TL L+250 03.7161 04/26/2024 0.50%
ALTISOURCE SOL TLB L+350 04.7261 12/09/2020 0.49%
EXTENDED STAY TLB L+250 03.7261 08/30/2023 0.49%
FORTERRA TL L+300 04.2261 10/25/2023 0.49%
GFL ENVIRONMENT TLB L+275 03.7500 09/27/2023 0.49%
ATOTECH TLB1 L+300 04.2964 01/31/2024 0.48%
BMC SOFTWARE TLB L+400 05.2261 09/10/2022 0.48%
CARAUSTAR TL L+550 06.7964 03/09/2022 0.48%
GATEWAY CASINO TLB1 L+375 04.7500 02/22/2023 0.48%
HARSCO TLB L+500 06.2500 11/02/2023 0.48%
HUB INTL TLB L+325 04.4223 10/02/2020 0.48%
WORLD KITCHEN TLB L+400 05.1696 05/02/2024 0.48%
CAESARS ENT OPER TLB6B L+775 11.5000 03/01/2018 0.47%
CHARTER COMM TLI L+225 03.4800 01/15/2024 0.47%
EAGLECLAW MID TL L+425 05.4656 06/08/2024 0.47%
GRIFOLS TLB L+225 03.2879 01/31/2025 0.47%
HUNTSMAN CORP TLB2 L+300 04.1208 04/01/2023 0.47%
PENN NATL TLB L+250 03.2500 01/19/2024 0.47%
SUDDENLINK TLB L+225 03.4661 01/25/2025 0.47%
USI INC TLB L+300 04.1796 04/06/2024 0.47%
VIRGIN MEDIA TLI L+275 03.9089 01/31/2025 0.47%
BASS PRO TLB L+500 06.2964 11/14/2023 0.46%
BJ'S WHOLESALE 1STL L+375 04.9681 02/03/2024 0.46%
JBS USA TLB L+150 05.7500 10/30/2022 0.46%
TRANSDIGM TLC L+300 04.2837 02/28/2020 0.45%
ADS WASTE TLB L+275 03.5000 10/28/2023 0.44%
LANDRY'S TLB L+275 03.9706 10/04/2023 0.44%
CBS RADIO TLB L+350 04.5000 10/17/2023 0.42%
COMMSCOPE TLB5 L+200 03.2964 12/29/2022 0.42%
LIBBEY GLASS TLB L+300 04.2244 04/09/2021 0.42%
CAPITAL AUTO 2NDL L+600 07.2200 03/24/2025 0.41%
GARDA WORLD TLB L+400 05.2261 05/03/2024 0.41%
SOLENIS 1STL L+325 04.4518 07/31/2021 0.41%
ZEKELMAN TLB L+350 04.7894 06/14/2021 0.41%
HILTON WORLDWIDE TLB2 L+200 03.2472 10/25/2023 0.40%
INDUS CONT SERV TL L+400 05.0000 04/28/2024 0.40%
VISTRA TLB L+275 03.5000 08/04/2023 0.40%
HCA INC 06.5000 02/15/2020 0.39%
REYNOLDS GRP ISS/REY P/P 144A 04.8039 07/15/2021 0.39%
REYNOLDS GROUP TL L+300 04.2261 02/05/2023 0.38%
BERRY PLASTICS TLI L+250 03.7255 10/01/2022 0.37%
GOLDMAN SACHS GROUP INC 02.9218 10/28/2027 0.37%
JPMORGAN CHASE & CO 07.9000 12/29/2049 0.37%
SCIENTIFIC GAMES INT P/P 144A 07.0000 01/01/2022 0.37%
ANHEUSER-BUSCH INBEV FIN 01.9000 02/01/2019 0.36%
CITIGROUP INC 02.6318 09/01/2023 0.36%
DOOSAN BOBCAT TLB L+275 03.9294 05/12/2024 0.36%
MITSUBISHI UFJ FIN GRP USD 02.2964 09/13/2021 0.36%
TEREX TL L+250 03.2500 01/31/2024 0.36%
VENATOR MATERIALS TLB L+300 04.2872 06/29/2024 0.36%
ADT/PRIME SECURITY TLB L+275 03.9738 05/02/2022 0.35%
AMAYA GAMING TLB L+350 04.7964 08/01/2021 0.35%
AMERICAN CASINO TLB L+325 04.4761 07/07/2022 0.35%
BEACON ROOFING TLB L+275 03.9594 10/01/2022 0.35%
BOYD GAMING TLB L+250 03.6889 09/15/2023 0.35%
ELDORADO RESORTS TLB L+225 03.5625 04/17/2024 0.35%
ISTAR TLB L+375 04.9686 07/01/2020 0.35%
MGM GROWTH PROP TLB L+225 03.4761 05/01/2023 0.35%
NIELSEN FIN TLB4 L+200 03.2244 10/04/2023 0.35%
AMERICAN TIRE DIST TL L+425 05.2500 09/01/2021 0.34%
CONCORDIA HEALTH TLB L+425 05.5011 10/21/2021 0.34%
JC PENNEY TLB L+425 05.2500 06/23/2023 0.34%
MANITOWOC FOODSERVICE L+300 04.2261 03/03/2023 0.33%
PETSMART INC TLB L+300 04.2460 03/11/2022 0.33%
CALPINE CONSTRUCT TLB2 L+250 03.7300 01/31/2022 0.32%
JACK OHIO FIN LLC/FI P/P 144A 06.7500 11/15/2021 0.32%
LIONS GATE TLB L+300 04.2261 12/08/2023 0.32%
RIVERS PITTSBURGH LP P/P 144A 06.1250 08/15/2021 0.32%
TOWNSQUARE TLB L+300 04.2964 04/01/2022 0.32%
CABLE ONE TLB L+225 03.4300 05/01/2024 0.30%
UFC 1STL L+325 04.4700 08/18/2023 0.30%
ASURION TLB5 L+300 04.2261 11/03/2023 0.29%
CHEMOURS TLB L+250 03.7300 05/12/2022 0.29%
MURRAY ENERGY TLB2 L+725 08.5464 04/17/2020 0.29%
VISTRA TLB2 L+325 04.4667 12/14/2023 0.29%
COLUMBUS MCKINNON TLB L+300 04.2964 01/20/2024 0.28%
DEL MONTE 1STL L+325 04.4300 02/18/2021 0.28%
IASIS HEALTHCARE TLB L+400 05.2964 02/17/2021 0.28%
MOTOR CITY TLB L+275 03.9761 08/09/2021 0.28%
ON SEMICONDUCTOR TLB L+225 03.4761 03/31/2023 0.28%
CALPINE CONS FIN TLB1 L+225 03.4800 05/03/2020 0.27%
CAPITAL AUTO 1STL L+300 04.2200 03/24/2024 0.27%
CBAC/HORSESHOE TLB L+700 08.2500 07/02/2020 0.27%
TALBOTS INC 1STL L+450 05.7261 03/19/2020 0.27%
ARCELORMITTAL USD 06.0000 03/01/2021 0.26%
FORD MOTOR CREDIT CO LLC 02.1037 11/04/2019 0.26%
SYNIVERSE HLDG TL L+300 04.2964 04/23/2019 0.26%
TRANSDIGM TLE L+300 04.2492 05/14/2022 0.26%
ALLY FINANCIAL INC 04.7500 09/10/2018 0.25%
BARCLAYS PLC USD 03.2946 08/10/2021 0.25%
CABLEVISION SYS CORP 08.0000 04/15/2020 0.25%
DISH DBS CORP 05.1250 05/01/2020 0.25%
GOLDEN NUGGET TL L+350 04.7100 11/21/2019 0.25%
ONEMAIN FIN HLDG INC P/P 144A 06.7500 12/15/2019 0.25%
SOLENIS 2NDL L+675 07.9518 07/31/2022 0.25%
ABC SUPPLY TLB L+250 03.7261 10/31/2023 0.24%
ALLERGAN FUNDING SCS USD 02.4831 03/12/2020 0.24%
ASURION LLC 2NDL L+750 08.7261 03/03/2021 0.24%
COMMUNITY HEALTH TLG L+275 03.9600 12/31/2019 0.24%
CONSOL CONTAINER TLB L+350 04.7261 05/22/2024 0.24%
GCP APPLIED TECH TLB L+325 04.4761 02/03/2022 0.24%
GLP CAP LP / FIN II 04.3750 11/01/2018 0.24%
ISTAR INC 04.8750 07/01/2018 0.24%
KINDER MORGAN INC. 03.0500 12/01/2019 0.24%
MICRON TECH TLB L+250 03.8000 04/26/2022 0.24%
MISYS 1STL L+350 04.7364 06/16/2024 0.24%
MISYS 2NDL L+725 08.4588 06/13/2025 0.24%
NEW ARCLIN 1STL L+425 05.2500 02/14/2024 0.24%
PQ CORP TLB L+425 05.4761 11/04/2022 0.24%
REMAX LLC TLB L+275 03.5000 11/30/2023 0.24%
RITE AID 2NDL L+387.5 04.8750 06/07/2021 0.24%
TRANSDIGM TLF L+300 04.2261 06/09/2023 0.24%
TRIBUNE MEDIA TLB L+300 04.2261 01/27/2024 0.24%
WELLS FARGO & COMPANY 02.5581 03/04/2021 0.24%
AVAYA TLB7 L+525 06.4165 05/29/2020 0.23%
ENTERCOM RADIO TLB L+350 04.7034 11/01/2023 0.23%
GENERAL ELECTRIC CO 01.5512 05/05/2026 0.23%
HORSESHOE BALTIMORE TL L+400 04.0000 07/07/2024 0.23%
TRINSEO TLB L+325 04.4761 11/05/2021 0.23%
AIR METHODS TLB L+350 04.7964 04/13/2024 0.22%
HD SUPPLY TLB L+275 03.5877 08/13/2021 0.22%
NATIONSTAR MORT/CAP CORP 06.5000 08/01/2018 0.22%
RITE AID 2NDL L+475 05.9800 08/21/2020 0.22%
TENET HEALTHCARE COR 04.7456 06/15/2020 0.22%
WPX ENERGY INC 07.5000 08/01/2020 0.22%
AVAYA INC TLB6 L+550 06.6665 03/31/2018 0.20%
CCC INFO 2NDL L+675 07.9761 03/30/2025 0.20%
CEMEX FINANCE LLC P/P 144A 09.3750 10/12/2022 0.20%
DCP MIDSTREAM P/P 144A 09.7500 03/15/2019 0.20%
GFL ENVIRONMENTAL P/P 144A 09.8750 02/01/2021 0.20%
GREAT LAKES D&D P/P 144A 08.0000 05/15/2022 0.20%
MATTAMY GROUP CORP P/P 144A 06.5000 11/15/2020 0.20%
PLATFORM SPEC TLB6 L+300 04.2261 06/07/2023 0.20%
AVAYA INC P/P 144A 07.0000 04/01/2019 0.19%
ENDEAVOR ENERGY RESO P/P 144A 07.0000 08/15/2021 0.19%
KRONOS 2NDL L+825 09.4196 11/01/2024 0.19%
SM ENERGY CO 06.5000 11/15/2021 0.19%
TALBOTS INC 2NDL L+850 09.7261 03/19/2021 0.19%
DYNEGY INC. 06.7500 11/01/2019 0.18%
SIGNODE INDUSTRIAL TLB L+275 04.0072 05/01/2021 0.17%
TMX FIN/TITLEMAX P/P 144A 08.5000 09/15/2018 0.17%
NAVISTAR INTERNATIONAL CORP 08.2500 11/01/2021 0.16%
TENET HEALTHCARE 06.2500 11/01/2018 0.16%
ICAHN ENTER/FIN 06.0000 08/01/2020 0.15%
IRON MOUNTAIN INC P/P 144A 06.0000 10/01/2020 0.15%
T-MOBILE USA INC. 04.0000 04/15/2022 0.15%
ASURION TLB4 L+325 04.4761 08/04/2022 0.14%
GCP APPLIED TECH P/P 144A 09.5000 02/01/2023 0.14%
INFOR SOFTWARE P/P 144A 07.1250 05/01/2021 0.14%
J CREW TLB L+300 04.2459 03/05/2021 0.14%
OASIS PETROLEUM INC 06.5000 11/01/2021 0.14%
ALLEGHENY TECHNOLOGIES INC 09.3750 06/01/2019 0.13%
ALLNEX TLB2 L+325 04.4062 09/13/2023 0.13%
AMER ENERGY MARC 1STL L+425 05.4744 08/04/2020 0.13%
BOMBARDIER INC P/P 144A 08.7500 12/01/2021 0.13%
CALATLANTIC GROUP INC 08.3750 05/15/2018 0.13%
CALIFORNIA RESOURCES L+1038 11.5339 12/31/2021 0.13%
ASCEND LEARNING TLB L+325 04.2500 06/28/2024 0.12%
BERRY PLASTICS CORP TLJ L+250 03.5384 01/19/2024 0.12%
CLEAR CHNL WORLD 07.6250 03/15/2020 0.12%
CNO FINANCIAL GROUP INC 04.5000 05/30/2020 0.12%
FORMULA ONE TLB L+375 05.0677 02/01/2024 0.12%
FRAC TECH INTL TLB L+475 05.9761 04/16/2021 0.12%
FTS INTL INC P/P 144A 08.7456 06/15/2020 0.12%
HD SUPPLY TLB L+275 02.7500 10/17/2023 0.12%
HUNTSMAN INTERNATIONAL LLC 04.8750 11/15/2020 0.12%
MELISSA & DOUG TLB L+450 05.7964 06/19/2024 0.12%
NEW ARCLIN 2NDL L+875 09.7500 02/14/2025 0.12%
NEXEO SOLUTIONS TLB L+375 04.9740 06/09/2023 0.12%
OXBOW CARBON 2NDL L+700 08.0000 01/19/2020 0.12%
RANGE RESOURCES CORP P/P 144A 05.7500 06/01/2021 0.12%
THE AES CORPORATION 04.2018 06/01/2019 0.12%
TI AUTO TLB L+275 03.5261 06/30/2022 0.12%
VALEANT PHARMA P/P 144A 07.0000 10/01/2020 0.12%
VANTAGE DRILLING INT-UNIT 0.12%
WIDEOPENWEST TLB L+325 04.2500 08/06/2023 0.12%
DIEBOLD INC TLB L+275 04.0000 11/06/2023 0.11%
FIRST DATA TL L+225 03.4661 07/10/2022 0.11%
GOLDEN NUGGET DD L+450 05.5000 11/21/2019 0.11%
PRESTIGE BRANDS TLB4 L+275 03.7500 01/26/2024 0.11%
ALLNEX TLB3 L+325 04.2500 09/13/2023 0.10%
AMERICAN AXLE & MFG INC 07.7500 11/15/2019 0.09%
BRIGGS & STRATTON CORPORATION 06.8750 12/15/2020 0.09%
BROOKFIELD RESID P/P 144A 06.5000 12/15/2020 0.09%
SEVEN GENS ENER P/P 144A 08.2500 05/15/2020 0.09%
VISTRA TLC L+275 03.5000 08/04/2023 0.09%
WIDEOPENWEST FIN 10.2500 07/15/2019 0.09%
ZUFFA (UFC) 2NDL L+750 08.7156 08/18/2024 0.09%
CHC GRP LLC/FIN P/P USD 00.0000 10/01/2020 0.08%
DEL MONTE 2NDL L+725 08.6900 08/18/2021 0.08%
DHX MEDIA TLB L+375 04.9761 12/22/2023 0.08%
ZAYO GROUP TLB2 L+250 03.5000 01/19/2024 0.08%
CEMEX SAB DE CV P/P 144A 06.0539 10/15/2018 0.07%
INDUS CONT SERV DD L+400 05.0000 04/25/2024 0.07%
AIR MEDICAL ADD-ON TLB L+400 05.0000 04/28/2022 0.06%
CIT GROUP INC P/P 144A 05.5000 02/15/2019 0.06%
INEOS TLB L+275 03.9761 03/31/2024 0.06%
KCA DEUTAG UK FIN PL P/P 144A 09.8750 04/01/2022 0.04%
TRIBUNE MEDIA TLB L+300 04.2261 12/27/2020 0.03%
STANDARD IND INC P/P 144A 05.1250 02/15/2021 0.02%
TRIBUNE CLASS 1C LITIGAT 0.02%
CHC GROUP LLC P/P 0.01%
TXU TCEH RIGHTS 0.01%
ASURION LLC TLB2 L+325 04.2947 07/08/2020 0.00%
CALATLANTIC GROUP INC. 06.2500 12/15/2021 0.00%

Prior top 10 holdings

Top 10 holdings as of 09/30/17
Cequel Communications
Scientific Games
Caesars Entertainment Corp
Transdigm
Brand Holdings
Univision Communications Inc
Ortho-Clinical Diagnostics
Sprint Communications
Community Health Systems
Valeant Pharmaceuticals International
Holdings represent 10.00% of portfolio
Top 10 holdings as of 08/31/17
Transdigm Tlg L+300 04.2639 08/16/2024
Brand Energy Tl L+425 05.5219 06/21/2024
Univision Tlc5 L+275 03.9889 03/15/2024
Ortho-Clinical Tlb L+375 05.0464 06/30/2021
Sprint Tlb L+250 03.7500 02/02/2024
Bway Corp Tlb L+325 04.4806 04/03/2024
Chesapeake Energy 1.5l L+750 08.5000 08/23/2021
Scientific Games Tlb4 L+325 04.5122 08/14/2024
Quikrete Tlb L+275 03.9889 11/15/2023
Energy Transfer Eq Tl L+275 02.7500 02/02/2024
Holdings represent 8.65% of portfolio
Top 10 holdings as of 07/31/17
Univision Tlc5 L+275 03.9839 03/15/2024
Brand Energy Tl L+425 05.5070 06/21/2024
Ortho-Clinical Tlb L+375 05.0464 06/30/2021
Sprint Tlb L+250 03.7500 02/02/2024
Chesapeake Energy 1.5l L+750 08.5000 08/23/2021
Bway Corp Tlb L+325 04.4739 04/03/2024
Scientific Games Tlb4 L+325 04.5606 08/14/2024
Quikrete Tlb L+275 03.9839 11/15/2023
Energy Transfer Eq Tl L+275 02.7500 02/02/2024
Revlon Cons Tlb L+350 04.7339 09/07/2023
Holdings represent 8.44% of portfolio
Top 10 holdings as of 06/30/17
Univision Tlc5 L+275 03.9761 03/15/2024
Brand Energy Tl L+425 05.4910 06/21/2024
Ortho-Clinical Tlb L+375 05.0464 06/30/2021
Sprint Tlb L+250 03.7500 02/02/2024
Chesapeake Energy 1.5l L+750 08.5000 08/23/2021
Bway Corp Tlb L+325 04.3259 04/03/2024
Quikrete Tlb L+275 03.9761 11/15/2023
Revlon Cons Tlb L+350 04.7261 09/07/2023
Energy Transfer Eq Tl L+275 02.7500 02/02/2024
Ppdi Tl L+275 04.0134 08/18/2022
Holdings represent 8.31% of portfolio

Fixed income statistics as of 09/30/17

Average effective maturity 5.03 yrs.
Average effective duration 0.38 yrs.
Average yield to maturity 4.75%
Average coupon 4.54%
Average price $100.24

Sector weightings as of 09/30/17

  Cash investments Non-cash investments Total portfolio
  Weight Spread duration Weight Spread duration Weight Spread duration
Bank loans 85.47% 4.07 0.00% 0.00 85.47% 4.07
High-yield corporate bonds 7.08% 0.12 0.00% 0.00 7.08% 0.12
Investment-grade corporate bonds 4.42% 0.17 0.00% 0.00 4.42% 0.17
Net cash 2.50% 0.00 0.00% 0.00 2.50% 0.00
Emerging-market bonds 0.28% 0.00 0.00% 0.00 0.28% 0.00
Equity investments 0.17% 0.00 0.00% 0.00 0.17% 0.00
Convertible securities 0.08% 0.00 0.00% 0.00 0.08% 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 09/30/17

0 - 1 yr. 6.79%
1 - 5 yrs. 33.55%
5 - 10 yrs. 59.28%
10 - 15 yrs. 0.38%

Quality rating as of 09/30/17

AA 0.48%
A 1.72%
BBB 6.77%
BB 42.47%
B 41.70%
CCC and Below 4.11%
Not Rated 0.25%
Net cash 2.50%

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 of the risk of default, 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 net assets as of the date indicated above. 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. Short-term cash bonds are included in the net cash category. Ratings and portfolio credit quality will vary over time. Derivative instruments, including currency forwards, are only included to the extent of any unrealized gain or loss on such instruments and are shown in the net cash category. Cash is also shown in the net cash category. The fund itself has not been rated by an independent rating agency.

Top Industry Sectors as of 09/30/17

Consumer cyclicals 23.56%
Basic materials 12.53%
Capital goods 9.83%
Health care 9.72%
Technology 8.85%
Financials 8.48%
Consumer staples 8.06%
Communication services 8.05%
Energy 4.65%
 
Other
6.27%
Utilities 3.53%
Net Cash 2.50%
Conglomerates 0.23%
Transportation 0.01%

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.

Country Allocation as of 09/30/17

United States 97.60%
Canada 0.59%
Japan 0.36%
Netherlands 0.33%
Mexico 0.28%
France 0.26%
United Kingdom 0.25%
Luxembourg 0.24%
Cayman Islands 0.09%

Expenses

Expense ratio

Class A Class B Class C Class M Class R Class Y
Total expense ratio 1.03% 1.23% 1.78% 1.08% 1.28% 0.78%
What you pay 1.03% 1.23% 1.78% 1.08% 1.28% 0.78%

Sales charge

Investment Breakpoint Class A Class B Class C Class M Class R 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 Y
0 to 9 mts. 1.00% 1.00% 1.00% -- -- --
9 to 12 mts. 0.00% 1.00% 1.00% -- -- --
2 yrs. -- 0.50% 0.00% -- -- --
3 yrs. -- -- 0.00% -- -- --
4 yrs. -- -- 0.00% -- -- --
5 yrs. -- -- 0.00% -- -- --
6 yrs. -- -- 0.00% -- -- --
7+ yrs. -- -- 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 of the risk of default, 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 net assets as of the date indicated above. 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. Short-term cash bonds are included in the net cash category. Ratings and portfolio credit quality will vary over time. Derivative instruments, including currency forwards, are only included to the extent of any unrealized gain or loss on such instruments and are shown in the net cash category. Cash is also shown in the net cash category. The fund itself has not been rated by an independent rating agency.