European High Yield

The strategy seeks to achieve above-average total return by investing primarily in high-yielding, non-investment-grade debt obligations issued by European corporations.*

Strategy highlights

Inception date

September 30, 1999


ICE BofA European Currency Developed Markets HY Constrained Index

Total strategy assets


(as of May 2022)

Investment vehicles

We believe outperformance is driven by:

  • Pursuing capital appreciation in credits with improving fundamentals
  • Skeptically investing in deteriorating or stagnant credits based on rigorous scenario analysis
  • Actively managing the top-down portfolio profile based on market outlook
  • Selecting issuers driven by bottom-up fundamental credit analysis
  • Adhering consistently to a risk-controlled process


We see multiple opportunities to pursue strong performance:

  • Wide range of issuers of various size, complexity, and geography
  • Capital structure complexity: senior, subordinate, and secured bonds as well as loans, convertibles, hybrids and preferred, and equity securities
  • Dislocations between cash instruments and derivatives
  • Varied security types including bullet maturities, floating rate notes, call/put option structures, covered bonds, etc.


Tracking error targets are based on a number of assumptions and are subject to revision and may change materially with changes in underlying assumptions. While the investment manager considers tracking error in the investment process, the strategy's composition and performance may vary substantially from that of the target. Achieved tracking error is the result of many factors, including market conditions and there can be no assurance that the tracking error actually reflected in client portfolios will be at levels indicated in the investment objectives.

*No assurance can be given that the investment objective will be achieved or that an investor will receive a return of all or part of his or her initial investment. Actual results could be materially different from the stated goals. Investors should carefully consider the risks involved before deciding to invest. As with any investment, there is a potential for profit as well as the possibility of loss.

Assets may include accounts that are not reflected in the composite.

Investment team


Annualized composite performance (%) as of May 31, 2022

  MTD QTD YTD 1 Year 3 Years 5 Years 10 Years
European High Yield (gross) -1.09% -4.61% -9.00% -7.59% 0.79% 1.48% 5.32%
European High Yield (net) -1.15% -4.72% -9.25% -8.20% 0.13% 0.82% 4.63%
ICE BofA European Currency Developed Markets HY Constrained Index -1.33% -4.11% -8.11% -7.28% 0.99% 1.42% 5.33%

Calendar-year composite performance (%) as of May 31, 2022

  2021 2020 2019 2018 2017 2016 2015 2014 2013 2012
European High Yield (gross) 3.68% 2.96% 12.34% -3.46% 7.15% 7.74% 3.99% 2.88% 11.35% 25.92%
European High Yield (net) 3.01% 2.29% 11.61% -4.08% 6.46% 7.04% 3.31% 2.21% 10.63% 25.10%
ICE BofA European Currency Developed Markets HY Constrained Index 3.36% 2.54% 11.47% -3.76% 6.77% 9.15% 1.49% 5.33% 10.21% 28.56%

Past performance is not a guarantee of future results. An investment in this strategy could lose value. Most recent month-end performance is preliminary. Returns are subject to change.

Periods less than one year are not annualized. Performance is stated in Euros. and includes the reinvestment of dividends and interest.


Important disclosures

The Putnam Investments European High Yield (EUR) Composite (the "Composite") seeks to achieve above-average total returns by investing primarily in high-yielding, non-investment-grade debt obligations issued by European corporations. The composite's benchmark is the ICE Bank of America (BofA) European Currency Developed Markets High Yield Constrained Index. Accounts in composite may have other different, but largely similar benchmarks. Leverage is not utilized in any account in this Composite. However, the use of forward currency contracts and other derivatives may be permitted in some portfolios for limited position hedging or non-hedging purposes. Composites may include portfolios with certain existing investment restrictions that the Firm believes do not materially impact the investment strategy. The Composite comprises all fully discretionary accounts managed by Putnam Investments in this investment style. The Composite inception date was September 30, 1991. The Composite creation date was May 13, 2003.


The ICE BofA European Currency Developed Markets High Yield Constrained Index contains all securities in the ICE BofA European Currency High Yield Constrained Index from developed markets countries, but caps issuer exposure at 3%.  Developed markets is defined as an FX-G10 member, a Western European nation, or territory of the US or a Western European nation. The FX-G10 includes all Euro members, the US, Japan, the UK, Canada, Australia, New Zealand, Switzerland, Norway, and Sweden. Prior to May 1, 2017, the composite's benchmark was the BofA Merrill Lynch European Currency High Yield Constrained Index. The ICE BofA European Currency High Yield Constrained Index tracks the performance of EUR and GBP denominated below investment grade corporate debt publicly issued in the eurobond, sterling domestic or euro domestic markets. Qualifying securities must have a below investment grade rating (based on an average of Moody's, S&P, and Fitch) and an investment grade rated country risk (based on an average of Moody's, S&P, and Fitch foreign currency long term sovereign debt ratings). The Composite's investment strategy focuses on investing primarily in developed nations, the new benchmark, which includes high-yield corporate debt from only investment-grade (i.e., developed) European countries, more closely aligns with the goals and investment universe for this strategy.



Gross performance includes the deduction of transaction costs but does not include the deduction of management fees and other expenses that may be incurred in managing an investment account. A portfolio's return will be reduced by advisory and other fees. Net performance reflects the deduction of a model fee applied on a monthly basis, equal to the actual management fee incurred by a portfolio in the Composite or the highest management fee that would be charged to a prospect of the strategy, whichever is higher. The model fee may change over time. Actual advisory fees may vary among clients with the same investment strategy. The Composite includes all actual, fully discretionary accounts with substantially similar investment policies and objectives managed to the Composite's investment strategy. Benchmarks are generally taken from published sources and may have different calculation methodologies, pricing times, and/or foreign-exchange sources from the Composite. The effect of those differences is generally deemed to be immaterial. The securities holdings of the Composite strategy may differ materially from those of the index used for comparative purposes.