Putnam Investments said January 13 that it had launched a family of four absolute return mutual funds designed to provide returns of 1%, 3%, 5%, or 7% above those of Treasury bills over a period of three years or more. Robert Reynolds, Putnam’s president and CEO, said the funds would be appealing to both investors and advisors as “a way to venture back into investing”–noting that there is some $12 trillion in cash on the sidelines–since they provide a “targeted total return for their portfolios and a high degree of transparency.” Moreover, Reynolds said he expect such funds “to represent a major share of the entire mutual fund industry in coming years.”
In addition to the funds’ specific return targets, each invests in a different mix of assets, according to the company. The four funds in the family are the:
o Putnam Absolute Return 100 Fund, which seeks to outperform inflation by 1% as measured by T-bills;
o Putnam Absolute Return 300 Fund, which seeks to outperform inflation by 3% as measured by T-bills;
o Putnam Absolute Return 500 Fund, which seeks to outperform inflation by 5% as measured by T-bills; and
o Putnam Absolute Return 700 Fund, which seeks to outperform inflation by 7% as measured by T-bills.