International Equity Fund (Class Y)  (POVYX)

Pursuing the growth potential of overseas markets since 1991

Highlights

Objective

The fund seeks capital appreciation.

Strategy and process

  • International companies: The fund invests in established large and midsize companies, mainly in developed markets to benefit from opportunities outside the United States.
  • A flexible strategy: Pursuing Putnam's blend strategy, the fund can own growth- or value-style stocks to participate when either style leads international markets.
  • A disciplined process: The portfolio manager invests using fundamental research and quantitative tools supported by strong risk controls in portfolio construction.

Fund price

Yesterday’s close 52-week high 52-week low
Net asset value $23.03
0.04% | $0.01
$28.60
01/26/18
$22.23
10/24/18
Historical fund price

Fund facts as of 10/31/18

Total net assets
$844.87M
Turnover (fiscal year end)
61%
Dividend frequency
Annually
Number of holdings
77
Fiscal year-end
June
CUSIP / Fund code
74680E507 / 1835
Inception date
07/12/96
Category
Blend
Open to new investors
Ticker
POVYX

Management team

Co-Head of Equities
Portfolio Manager, Analyst


Literature


Are international stocks truly cheap?
On the surface, U.S. stocks appear more expensive than international stocks, but a quantitative comparison reveals the impact of sector valuations.
Just how cheap are European equities?
Our analysis finds that industry group weightings play a significant role in valuation discrepancies between U.S. and European equities.
Proceeding toward Brexit: The risks for investors
With the United Kingdom beginning to move forward with Brexit, we see risks to the economy, the pound, and the markets.

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.

26.70%

Best 5-year annualized return

(for period ending 03/31/00)


-7.81%

Worst 5-year annualized return

(for period ending 06/30/12)


7.84%

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 -1.05% 6.72% 3.90% 4.92%
After sales charge N/A N/A N/A N/A
MSCI EAFE Index (ND) 2.74% 9.23% 4.42% 5.38%

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 -9.74 % -
YTD as of 11/16/18 -12.93 % -

Risk-adjusted performance as of 10/31/18

Alpha (3 yrs.) -2.65
Sharpe ratio (3 yrs.) 0.02
Treynor ratio (3 yrs.) 0.25
Information ratio (3 yrs.) -0.76

Volatility as of 10/31/18

Standard deviation (3 yrs.) 11.86%
Beta 1.04
R-squared 0.92

Capture ratio as of 10/31/18

Up-market (3 yrs.) 97.34
Down-market (3 yrs.) 114.12

Lipper rankings as of 10/31/18

Time period Rank/Funds in category Percentile ranking
1 yr. 365/406 90%
3 yrs. 315/349 90%
5 yrs. 203/264 77%
10 yrs. 99/184 54%
Lipper category: International Multi-Cap Core

Morningstar Ratings as of 10/31/18

Time period Funds in category Morningstar Rating
Overall 642
3 yrs. 642
5 yrs. 523
10 yrs. 387
Morningstar category: Foreign Large Blend

Distributions

Record/Ex dividend date 12/21/17
Payable date 12/26/17
Income $0.156
Extra income --
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.


Holdings

Top 10 holdings as of 10/31/18

Total 3.24%
Bp 2.75%
Novartis Ag 2.48%
Rio Tinto 2.45%
Orix Corp 2.27%
Uniper 2.15%
Astrazeneca 2.12%
Sumitomo Mitsui Financial Group 2.07%
Sony Corp 2.06%
Prudential 2.03%
Top 10 holdings, percent of portfolio 23.62%

Full portfolio holdings as of 09/30/18

TOTAL SA 3.17%
BP PLC 2.59%
RIO TINTO PLC 2.26%
NOVARTIS AG-REG 2.16%
HOYA CORP 2.09%
SONY CORP 2.08%
TOYOTA MOTOR CORP 2.07%
PRUDENTIAL PLC 2.06%
ORIX CORP 2.01%
BAYER AG-REG 1.99%
UNIPER SE 1.96%
ASTRAZENECA PLC 1.91%
SHISEIDO CO LTD 1.90%
AIRBUS SE 1.84%
UNILEVER NV-CVA 1.83%
KONINKLIJKE AHOLD DELHAIZE N 1.79%
SUMITOMO MITSUI FINANCIAL GR 1.73%
SIEMENS AG 1.68%
ASSOCIATED BRITISH FOODS PLC 1.66%
ADIDAS AG 1.61%
EVONIK INDUSTRIES AG 1.52%
NATIXIS 1.50%
CHALLENGER LTD 1.48%
ASAHI GROUP HOLDINGS LTD 1.47%
KOMATSU LTD 1.47%
SOCIETE GENERALE SA 1.47%
CRH PLC 1.44%
COMPASS GROUP PLC 1.43%
DBS GROUP HOLDINGS LTD 1.39%
FERGUSON PLC 1.39%
SKF AB-B SHARES 1.38%
NXP SEMICONDUCTORS NV 1.37%
CHUGAI PHARMACEUTICAL CO LTD 1.36%
RHEINMETALL AG 1.33%
ASHTEAD GROUP PLC 1.29%
CENOVUS ENERGY INC 1.23%
KDDI CORP 1.23%
MAGNA INTERNATIONAL INC 1.23%
HEINEKEN NV 1.20%
CAIXABANK S.A 1.17%
ASSA ABLOY AB-B 1.16%
VEOLIA ENVIRONNEMENT 1.16%
KKR & CO INC -A 1.14%
SAMSUNG ELECTRONICS-PREF 1.11%
KERRY GROUP PLC-A 1.10%
TOSHIBA CORP 1.09%
VINCI SA 1.09%
EURAZEO SE 1.08%
BURFORD CAPITAL LTD 1.07%
PIRELLI & C SPA 1.07%
BANK OF IRELAND GROUP PLC 1.05%
ORION ENGINEERED CARBONS SA 1.05%
WANT WANT CHINA HOLDINGS LTD 1.05%
KYUDENKO CORP 1.04%
INSURANCE AUSTRALIA GROUP LTD 1.03%
SEVEN & I HOLDINGS CO LTD 1.03%
AMAZON.COM INC 1.01%
KYOCERA CORP 0.97%
VIRGIN MONEY HOLDINGS UK 0.96%
DANSKE BANK A/S 0.93%
TENCENT HOLDINGS LTD 0.93%
SINO-AMERICAN SILICON PRODUC 0.88%
CONSTELLATION SOFTWARE INC 0.86%
NOMAD FOODS LTD 0.86%
BRILLIANCE CHINA AUTOMOTIVE 0.82%
KERING 0.81%
DAIKIN INDUSTRIES LTD 0.79%
KION GROUP AG 0.76%
SIG COMBIBLOC GROUP 0.76%
SWISS FRANC CALL ACCOUNT 0.76%
SUNNY OPTICAL TECH 0.74%
HDFC BANK LTD-ADR 0.73%
QUILTER PLC 0.70%
WIZZ AIR HLDG PLC 0.61%
THE EURO EUR CALL ACCOUNT 0.19%
CHF/USD 12/19/2018 JPMCB 0.04%
INDIAN RUPEE CALL ACCOUNT 0.03%
CHF/USD 12/19/2018 BCAP-FX 0.02%
GLOBAL FASHION GRP 0.02%
GLOBAL FASHION GRP P/P 0.02%
CAD/USD 10/17/2018 JPMCB 0.01%
DKK/USD 12/19/2018 CITI 0.01%
JPY/USD 11/19/2018 SSBT 0.01%
SEK/USD 12/19/2018 CSI-FX 0.01%
AUD/USD 10/17/2018 BANKAM 0.00%
AUD/USD 10/17/2018 CITI 0.00%
AUD/USD 10/17/2018 GSFX 0.00%
AUD/USD 10/17/2018 SSBT 0.00%
AUD/USD 10/17/2018 UBS 0.00%
AUSTRALIAN DOLLAR ACCOUNT 0.00%
CAD/USD 10/17/2018 BANKAM 0.00%
CAD/USD 10/17/2018 CITI 0.00%
CAD/USD 10/17/2018 WPAC 0.00%
CNH/USD 11/19/2018 GSFX 0.00%
EUR/USD 12/19/2018 BCAP-FX 0.00%
EUR/USD 12/19/2018 JPMCB 0.00%
GBP/USD 12/19/2018 BANKAM 0.00%
GBP/USD 12/19/2018 BCAP-FX 0.00%
GBP/USD 12/19/2018 CITI 0.00%
GBP/USD 12/19/2018 GSFX 0.00%
GBP/USD 12/19/2018 RBSF 0.00%
HC BRILLANT SERVICES GMBH P/P 0.00%
HKD/USD 11/19/2018 BANKAM 0.00%
HKD/USD 11/19/2018 BCAP-FX 0.00%
HONG KONG DOLLAR CALL ACCOUNT 0.00%
ILS/USD 10/17/2018 SSBT 0.00%
JPY/USD 11/19/2018 CITI 0.00%
JPY/USD 11/19/2018 JPMCB 0.00%
KOREAN WON CALL ACCOUNT 0.00%
KRW/USD 11/19/2018 JPMCB 0.00%
NEW BIGFOOT OTHER ASSETS GMBH P/P 0.00%
NEW MIDDLE EAST OTHER ASSETS GMBH P/P 0.00%
NOK/USD 12/19/2018 JPMCB 0.00%
NZD/USD 10/17/2018 CITI 0.00%
NZD/USD 10/17/2018 HSBCB 0.00%
POUND STERLING CALL ACCOUNT 0.00%
SEK/USD 12/19/2018 JPMCB 0.00%
SGD/USD 11/19/2018 JPMCB 0.00%
EUR/USD 12/19/2018 BANKAM -0.01%

Prior top 10 holdings

Top 10 holdings as of 10/31/18
Total
Bp
Novartis Ag
Rio Tinto
Orix Corp
Uniper
Astrazeneca
Sumitomo Mitsui Financial Group
Sony Corp
Prudential
Holdings represent 23.62% of portfolio
Top 10 holdings as of 09/30/18
Total
Bp
Rio Tinto
Novartis Ag
Hoya Corp
Sony Corp
Toyota Motor Corp
Prudential
Orix Corp
Bayer Ag
Holdings represent 22.48% of portfolio
Top 10 holdings as of 08/31/18
Total
Bp
Unilever Nv
Rio Tinto
Bayer Ag
Novartis Ag
Toyota Motor Corp
Hoya Corp
Prudential
Orix Corp
Holdings represent 21.72% of portfolio
Top 10 holdings as of 07/31/18
Total
Bayer Ag
Rio Tinto
Toyota Motor Corp
Unilever Nv
Prudential
Hoya Corp
Novartis Ag
Orix Corp
Bp
Holdings represent 22.17% of portfolio

Portfolio composition as of 10/31/18

Common stock 98.16%
Preferred stock 1.15%
Cash and net other assets 0.67%
Convertible preferred stock 0.02%

Equity statistics as of 10/31/18

Median market cap $21.61B
Weighted average market cap $66.96B
Price to book 1.56
Price to earnings 11.85

Fund characteristics will vary over time.

Due to rounding, percentages may not equal 100%.

Consider these risks before investing: International investing involves currency, economic, and political risks. Emerging-market securities carry illiquidity and volatility risks. Investments focused in a single region may be affected by common economic forces and other factors. In addition, events in any one country within the region may impact the other countries or the region as a whole. Because the fund currently, and may in the future, invest significantly in European companies, the fund is particularly susceptible to economic, political, regulatory or other events or conditions affecting issuers in Europe. European financial markets have in recent years experienced increased volatility due to concerns with some countries’ high levels of sovereign debt, budget deficits, and unemployment. Investments in small and/or midsize companies increase the risk of greater price fluctuations. Growth stocks may be more susceptible to earnings disappointments, and value stocks may fail to rebound. Stock prices may fall or fail to rise over extended periods of time for a variety of reasons, including general financial market conditions, changing market perceptions, changes in government intervention in the financial markets, and factors related to a specific issuer or industry. These and other factors may lead to increased volatility and reduced liquidity in the fund's portfolio holdings. 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. You can lose money by investing in the fund.

Top industry sectors as of 10/31/18

Financials 20.05%
Industrials 15.40%
Consumer staples 14.96%
Consumer discretionary 11.28%
Health care 10.74%
Energy 7.87%
Materials 7.26%
Information technology 6.20%
Utilities 3.46%
 
Other
2.78%
Communication services 2.11%
Cash and net other assets 0.67%

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

Sectors will vary over time.

Country allocation as of 10/31/18

Japan 23.05%
United Kingdom 18.81%
France 12.60%
Germany 10.38%
Netherlands 5.31%
Switzerland 4.36%
United States 4.28%
Ireland 3.73%
Canada 2.80%
 
Other
14.68%
Australia 2.61%
Sweden 2.14%
China 2.03%
Singapore 1.39%
Italy 1.15%
South Korea 1.15%
Luxembourg 1.00%
Spain 0.94%
Taiwan 0.82%
India 0.78%
Cash and net other assets 0.67%

Expenses

Expense ratio

Class A Class B Class C Class M Class R Class R5 Class R6 Class Y
Total expense ratio 1.22% 1.97% 1.97% 1.72% 1.47% 0.89% 0.79% 0.97%
What you pay 1.22% 1.97% 1.97% 1.72% 1.47% 0.89% 0.79% 0.97%

Sales charge

Investment Breakpoint Class A Class B Class C Class M Class R Class R5 Class R6 Class Y
$0-$49,999 5.75% 0.00% 0.00% 3.50% -- -- -- --
$50,000-$99,999 4.50% 0.00% 0.00% 2.50% -- -- -- --
$100,000-$249,999 3.50% -- 0.00% 1.50% -- -- -- --
$250,000-$499,999 2.50% -- 0.00% 1.00% -- -- -- --
$500,000-$999,999 2.00% -- 0.00% 1.00% -- -- -- --
$1M-$4M 0.00% -- -- -- -- -- -- --
$4M-$50M 0.00% -- -- -- -- -- -- --
$50M+ 0.00% -- -- -- -- -- -- --

CDSC

  Class A (sales for $1,000,000+) Class B Class C Class M Class R Class R5 Class R6 Class Y
0 to 9 mts. 1.00% 5.00% 1.00% -- -- -- -- --
9 to 12 mts. 1.00% 5.00% 1.00% -- -- -- -- --
2 yrs. 0.00% 4.00% 0.00% -- -- -- -- --
3 yrs. 0.00% 3.00% 0.00% -- -- -- -- --
4 yrs. 0.00% 3.00% 0.00% -- -- -- -- --
5 yrs. 0.00% 2.00% 0.00% -- -- -- -- --
6 yrs. 0.00% 1.00% 0.00% -- -- -- -- --
7+ yrs. 0.00% 0.00% 0.00% -- -- -- -- --

The MSCI EAFE Index is an unmanaged index of equity securities from developed countries in Western Europe, the Far East, and Australasia. You cannot invest directly in an index.

Consider these risks before investing: International investing involves currency, economic, and political risks. Emerging-market securities carry illiquidity and volatility risks. Investments focused in a single region may be affected by common economic forces and other factors. In addition, events in any one country within the region may impact the other countries or the region as a whole. Because the fund currently, and may in the future, invest significantly in European companies, the fund is particularly susceptible to economic, political, regulatory or other events or conditions affecting issuers in Europe. European financial markets have in recent years experienced increased volatility due to concerns with some countries’ high levels of sovereign debt, budget deficits, and unemployment. Investments in small and/or midsize companies increase the risk of greater price fluctuations. Growth stocks may be more susceptible to earnings disappointments, and value stocks may fail to rebound. Stock prices may fall or fail to rise over extended periods of time for a variety of reasons, including general financial market conditions, changing market perceptions, changes in government intervention in the financial markets, and factors related to a specific issuer or industry. These and other factors may lead to increased volatility and reduced liquidity in the fund's portfolio holdings. 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. You can lose money by investing in the fund.