Putnam European High Yield Fund (Class E)

Pursuing capital appreciation in European corporate credit with improving fundamentals

Highlights

Objective

The fund seeks to provide high current income. Capital growth is a secondary objective when consistent with the objective of high current income.

Strategy and process

  • Disciplined investment process: The portfolio managers apply a disciplined process of ranking securities on their liquidity, credit profile, and financial condition and sizing positions based on level of conviction.
  • Rigorous fundamental analysis: The investment process combines bottom-up fundamental credit analysis focusing on avoiding deteriorating credits with identifying selective opportunities for capital appreciation.
  • Experienced management: The fund's long tenured managers are backed by the deep experience of Putnam's Global Credit team.

Fund price

Yesterday’s close 52-week high 52-week low
Net asset value €1,055.20
-0.09% | €-0.98
€1,056.65
16/09/2019
€954.93
04/01/2019
Historical fund price

Fund facts as of 31/08/2019

Total net assets
$17.75M
Dividend frequency
Annually
Number of holdings
89
Fiscal year-end
June
CUSIP / Fund code
-- / RN3
Inception date
14/07/2017
Category
Fixed Income
Open to new investors

Net income attributable to Unitholders of Class E Units will be distributed annually. The Fund does not currently intend to distribute net income to Unitholders of the other Classes of Units of the Fund.

Management team

Co-Head of Fixed Income
Portfolio Manager


Literature

Fund documents

Prospectus (PDF)
Fact Sheet (PDF)

Performance

  • Total return (%) as of 30/06/2019

  • Annual performance as of 30/06/2019

Annualized Total return (%) as of 30/06/2019

Annualized performance 1 yr. 3 yrs. 5 yrs. 10 yrs.
Before sales charge 5.81% 4.28% 2.41% 7.73%
ICE BofAML European Currency HY Constrained Index 5.48%5.46%4.20%10.31%

Data is historical. Past performance is not a guarantee of future results. More recent returns may be more or less than those shown. Investment return and principal value will fluctuate, and you may have a gain or a loss when you sell your units. Performance assumes reinvestment of distributions at net asset value (NAV) and reflects fund operating expenses such as management fees but does not account for any taxes or sales charges. The payment of any sales charges will reduce performance. Performance for each class of Units is denominated in the currency of the respective class.

Performance prior to the Fund's inception date reflects that of Putnam New Flag Euro High Yield Fund, a UCITS that merged into the Fund on its inception date and which had a virtually identical investment objective and set of investment strategies.

 

Performance snapshot

  Before sales charge
1 mt. as of 31/08/2019 0.71%
YTD as of 18/09/2019 9.81%

Risk-adjusted performance as of 31/08/2019

Information ratio (3 yrs.) -1.27

Volatility as of 31/08/2019

Standard deviation (3 yrs.) 3.87%
Beta 1.07
R-squared 0.93

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 31/08/2019

Virgin Media 3.84%
Telefonica 3.69%
Europcar Mobility Groupe 3.61%
Vodafoneziggo Group Holding BV 3.55%
Iron Mountain 3.39%
Unitymedia 3.29%
ARD Holdings 3.05%
Versura 2.93%
UBS Group 2.76%
Refinitiv 2.64%
Top 10 holdings, percent of portfolio 32.75%

Full portfolio holdings as of 30/06/2019

TELEFONICA EUROPE BV REGS 05.8750 03/31/2024 3.64%
ZIGGO BOND COMPANY B.V. REGS 04.6250 01/15/2025 3.56%
UNITYMEDIA HESSEN / NRW REGS 06.2500 01/15/2029 3.29%
VERISURE MIDHOLDING AB REGS 05.7500 12/01/2023 2.92%
VIRGIN MEDIA FINANCE PLC REGS 04.5000 01/15/2025 2.31%
ARD FINANCE SA 06.6250 09/15/2023 2.31%
CONSTELLIUM N.V. REGS 04.2500 02/15/2026 2.26%
TECHEM VERWALTUNGSGES REGS 06.0000 07/30/2026 2.22%
IRON MOUNTAIN UK PLC REGS 03.8750 11/15/2025 2.10%
SIGMA HOLDCO BV REGS 05.7500 05/15/2026 1.95%
EUROPCAR MOB DAC REGS 04.0000 04/30/2026 1.92%
NOVAFIVES REGS 05.0000 06/15/2025 1.82%
VIRGIN MEDIA SECURED FIN REGS 06.2500 03/28/2029 1.74%
TELENET FINANCE VI REGS 04.8750 07/15/2027 1.65%
UBS GROUP FUNDING SWITZE REGS 07.0000 12/31/2049 1.52%
PINNACLE BIDCO PLC REGS 06.3750 02/15/2025 1.51%
STONEGATE PUB CO REGS 04.8750 03/15/2022 1.43%
INFOR US INC 05.7500 05/15/2022 1.42%
BANCO BILBAO VIZCAYA ARG REGS 08.8750 12/29/2049 1.40%
BANCO SANTANDER SA REGS 06.7500 12/31/2049 1.36%
ALTICE LUXEMBOURG SA REGS 06.2500 02/15/2025 1.34%
IRON MOUNTAIN INC REGS 03.0000 01/15/2025 1.29%
VOLKSWAGEN INTL FIN NV REGS 03.8750 06/14/2027 1.27%
ALTICE FINCO S.A. REGS 04.7500 01/15/2028 1.27%
EAGLE INT GLO/RUYI US FI REGS 05.3750 05/01/2023 1.19%
CREDIT SUISSE GROUP AG REGS 06.2500 12/29/2049 1.17%
UBS GROUP FUNDING SWITZE REGS 06.8750 12/29/2049 1.15%
ING GROEP NV USD 06.0000 12/29/2049 1.11%
ICELAND BONDCO PLC REGS 04.6250 03/15/2025 1.10%
SUNSHINE MID BV REGS 06.5000 05/15/2026 1.07%
CASINO GUICHARD PERRACHO REGS 03.5800 02/07/2025 1.05%
EUROPCAR MOBILITY GROUP REGS 04.1250 11/15/2024 1.02%
REFINITIV US HOLDINGS REGS 04.5000 05/15/2026 0.99%
EQUINIX INC 02.8750 03/15/2024 0.98%
FIAT CHRYSLER AUTOMOBIL REGS 03.7500 03/29/2024 0.97%
WIND TRE S.P.A. REGS 02.6250 01/20/2023 0.94%
EL CORTE INGLES SA REGS 03.0000 03/15/2024 0.92%
CIRSA FINANCE INTER REGS 06.2500 12/20/2023 0.82%
NETFLIX INC REGS 04.6250 05/15/2029 0.74%
EI GROUP PLC REGS 07.5000 03/15/2024 0.73%
VANTIV LLC/ISSUER CORP REGS 03.8750 11/15/2025 0.73%
TAKKO LUX 2 SCA REGS 05.3750 11/15/2023 0.73%
MILLER HOMES GRP HLDS REGS 05.5000 10/15/2024 0.71%
CONSTANTIN INVESTISSEME REGS 05.3750 04/15/2025 0.69%
SYNLAB BONDCO PLC REGS 03.5000 07/01/2022 0.69%
CODERE FINANCE 2 LUXEMBO REGS 06.7500 11/01/2021 0.69%
CREDIT AGRICOLE SA REGS 06.5000 06/23/2021 0.68%
VOLKSWAGEN INTL FIN NV REGS 03.7500 03/24/2021 0.68%
NETFLIX INC 03.6250 05/15/2027 0.68%
ARDAGH PKG FIN/HLDGS USA REGS 04.7500 07/15/2027 0.68%
ALTICE FRANCE SA REGS 05.8750 02/01/2027 0.68%
IQVIA INC REGS 03.2500 03/15/2025 0.68%
NETFLIX INC REGS 03.8750 11/15/2029 0.68%
DEUTSCHE BANK AKTIENGESE REGS 04.5000 05/19/2026 0.67%
BELDEN INC REGS 04.1250 10/15/2026 0.66%
INTERTRUST GROUP BV REGS 03.3750 11/15/2025 0.66%
MATALAN FINANCE PLC REGS 06.7500 01/31/2023 0.66%
WMG ACQUISITION CORP REGS 03.6250 10/15/2026 0.66%
FAURECIA REGS 03.1250 06/15/2026 0.66%
CIRSA FINANCE INTER REGS 04.7500 05/22/2025 0.66%
ENERGIZER GAMMA ACQ BV REGS 04.6250 07/15/2026 0.66%
REXEL SA REGS 02.7500 06/15/2026 0.65%
PANTHER BF AGGREGATOR 2 REGS 04.3750 05/15/2026 0.65%
ARENA LUX FIN SARL REGS 02.8750 11/01/2024 0.65%
EIRCOM FINANCE DAC REGS 03.5000 05/15/2026 0.65%
INEOS GROUP HLDG S.A. REGS 05.3750 08/01/2024 0.65%
NEWCO GB SAS REGS 08.0000 12/15/2022 0.65%
BWAY HOLDING CO REGS 04.7500 04/15/2024 0.64%
IQVIA INC REGS 03.5000 10/15/2024 0.64%
EC FINANCE PLC REGS 02.3750 11/15/2022 0.64%
FIAT CHRYSLER FINANCE EU REGS 06.7500 10/14/2019 0.64%
UNILABS SUBHOLD REGS 05.7500 05/15/2025 0.64%
SYNLAB BONDCO PLC REGS 06.2500 07/01/2022 0.64%
SAMSONITE FINCO REGS 03.5000 05/15/2026 0.64%
BAUSCH HEALTH COS INC REGS 04.5000 05/15/2023 0.63%
MATTERHORN TELECOM SA REGS 03.8750 05/01/2022 0.63%
STARFRUIT FINCO/STAR US REGS 06.5000 10/01/2026 0.63%
LOXAM SAS REGS 02.8750 04/15/2026 0.63%
CHEMOURS CO 04.0000 05/15/2026 0.63%
SCIENTIFIC GAMES INTERNA REGS 03.3750 02/15/2026 0.63%
KRONOS INTERNATIONAL INC REGS 03.7500 09/15/2025 0.62%
TEVA PHARM FNC NL II REGS 01.2500 03/31/2023 0.56%
SAFARI VERWALTUNGS GMBH REGS 05.3750 11/30/2022 0.55%
CASINO GUICHARD-PERRACHO REGS 01.8650 06/13/2022 0.53%
ALTICE LUXEMBOURG S.A. REGS 07.2500 05/15/2022 0.26%
PHOSPHORUS HOLDCO PLC REGS 10.0000 04/01/2020 0.06%
GBP/EUR 09/18/2019 BANKAM 0.00%
GBP/EUR 09/18/2019 BCAP-FX 0.00%
GBP/EUR 09/18/2019 CITI 0.00%
GBP/EUR 09/18/2019 SSBT 0.00%
USD/EUR 09/18/2019 GSFX 0.00%
USD/EUR 09/18/2019 RBSF 0.00%

Prior top 10 holdings

Top 10 holdings as of 31/08/2019
Virgin Media
Telefonica
Europcar Mobility Groupe
Vodafoneziggo Group Holding BV
Iron Mountain
Unitymedia
ARD Holdings
Versura
UBS Group
Refinitiv
Holdings represent 32.75% of portfolio
Top 10 holdings as of 31/07/2019
Virgin Media
Telefonica
Europcar Mobility Groupe
Vodafoneziggo Group Holding BV
Iron Mountain
Unitymedia
ARD Holdings
Versura
UBS
Altice Numericable
Holdings represent 32.67% of portfolio
Top 10 holdings as of 30/06/2019
Virgin Media
Telefonica
Vodafoneziggo Group Holding BV
Europcar Mobility Groupe
Iron Mountain
Unitymedia
ARD Holdings
Versura
UBS
Altice Numericable
Holdings represent 32.90% of portfolio
Top 10 holdings as of 31/05/2019
Virgin Media
Vodafoneziggo Group Holding BV
Telefonica
Unitymedia
Iron Mountain
Altice Numericable
Europcar Mobility Groupe
ARD Holdings
Versura
UBS Group
Holdings represent 33.45% of portfolio

Unitholders may obtain more recent information about certain Funds' portfolio holdings from time to time by contacting the Manager. Portfolio holdings information will only be provided for legitimate purposes as determined by the Manager, and will be subject to a reasonable delay intended to protect the Funds.

Fixed income statistics as of 31/08/2019

Average effective maturity 2.52 yrs.
Average effective duration 2.20 yrs.
Average yield to maturity 3.94%
Average coupon 5.00%

Sector weightings as of 31/08/2019

  Cash investments Non-cash investments Total portfolio
  Weight Spread duration Weight Spread duration Weight Spread duration
High-yield corporate bonds 79.02% 1.87 0.00% 0.00 79.02% 1.87
Investment-grade corporate bonds 14.28% 0.32 0.00% 0.00 14.28% 0.32
Emerging-market bonds 1.75% 0.06 0.00% 0.00 1.75% 0.06
Net cash 4.95% 0.00 0.00% 0.00 4.95% 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 31/08/2019

0 - 1 yr. 30.43%
1 - 5 yrs. 55.53%
5 - 10 yrs. 13.36%
10 - 15 yrs. 0.68%

Quality rating as of 31/08/2019

BBB 15.77%
BB 29.90%
B 39.18%
CCC and Below 10.20%
Net cash 4.95%

Fund characteristics will vary over time.

Due to rounding, percentages may not equal 100%.

Risks: International investing involves currency, economic, and political risks. Emerging-market securities carry illiquidity and volatility risks. Lower-rated bonds may offer higher yields in return for more risk. Funds that invest in government securities are not guaranteed. Mortgage-backed investments, unlike traditional debt investments, are subject to prepayment risk, which means that they may increase in value less than other bonds when interest rates decline and decline in value more than other bonds when interest rates rise. The fund concentrates on a limited group of industries and is non-diversified. Because the fund may invest in fewer issuers than a diversified fund, it is vulnerable to common economic forces and may result in greater losses and volatility. 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 generally greater for longer-term bonds, and credit risk is generally greater for below-investment-grade bonds. 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. Unlike bonds, funds that invest in bonds have fees and expenses. The value of investments in the fund's portfolio may fall or fail to rise over extended periods of time for a variety of reasons, including general economic, political or financial market conditions, investor sentiment and market perceptions, government actions, geopolitical events or changes, and factors related to a specific issuer, geography, industry or sector. These and other factors may lead to increased volatility and reduced liquidity in the fund's portfolio holdings.

You can lose money by investing in the fund.

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.

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 31/08/2019

Consumer cyclicals 26.03%
Communication services 22.73%
Consumer staples 17.01%
Financials 11.59%
Capital goods 6.29%
Basic materials 5.41%
Net Cash 4.95%
Health care 4.55%
Technology 1.44%

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 31/08/2019

United States 17.37%
France 14.53%
United Kingdom 12.84%
Luxembourg 11.70%
Netherlands 9.18%
Germany 8.73%
Spain 7.36%
Switzerland 3.99%
European Community 3.64%
 
Other
10.66%
Sweden 3.58%
Italy 2.67%
Ireland 1.37%
Belgium 1.29%
China 1.22%
Israel 0.53%

Expenses

Expense ratio

Class E
Total expense ratio 1.24%

The ICE BofAML European Currency High Yield Constrained Index, hedged into euro (HPC0), is an unmanaged list of lower-rated, higher-yielding, European corporate bonds with all currency exposure hedged back into euro. It is not possible to invest directly in an index.

Risks: International investing involves currency, economic, and political risks. Emerging-market securities carry illiquidity and volatility risks. Lower-rated bonds may offer higher yields in return for more risk. Funds that invest in government securities are not guaranteed. Mortgage-backed investments, unlike traditional debt investments, are subject to prepayment risk, which means that they may increase in value less than other bonds when interest rates decline and decline in value more than other bonds when interest rates rise. The fund concentrates on a limited group of industries and is non-diversified. Because the fund may invest in fewer issuers than a diversified fund, it is vulnerable to common economic forces and may result in greater losses and volatility. 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 generally greater for longer-term bonds, and credit risk is generally greater for below-investment-grade bonds. 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. Unlike bonds, funds that invest in bonds have fees and expenses. The value of investments in the fund's portfolio may fall or fail to rise over extended periods of time for a variety of reasons, including general economic, political or financial market conditions, investor sentiment and market perceptions, government actions, geopolitical events or changes, and factors related to a specific issuer, geography, industry or sector. These and other factors may lead to increased volatility and reduced liquidity in the fund's portfolio holdings.

You can lose money by investing in the fund.

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.

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.