Active Allocation

Putnam Income Model (Class A)

A 0% stock/100% bond model portfolio blending active and passive exposures

Highlights

Strategy and process

  • Targeted diversification Putnam’s model portfolios offer choices that are diversified for investors no matter where they are on the path to their financial goals.
  • Professional management The Investment Committee brings together veteran members of Putnam’s long-tenured Global Asset Allocation team (GAA) and Portfolio Solutions Group (PSG).
  • Competitive cost structure The model portfolios combine actively managed Putnam funds and passive ETFs for cost-efficient market exposures, with no overlay fees.

Key facts

Inception date
11/30/19
Category
Asset Allocation

Management team

Chief Investment Officer, Global Asset Allocation
Co-Head of Global Asset Allocation
Co-Head of Global Asset Allocation
Investment Director, Global Asset Allocation
Senior Investment Director, Global Asset Allocation
Senior Investment Director, Global Asset Allocation


Literature

Fund documents

Fact sheet (PDF)
Brochure (PDF)

Performance

  • Total return (%) as of 09/30/20

Annualized Total return (%) as of 09/30/20

Annualized composite performance (net) 1 yr. 3 yrs. 5 yrs.
Putnam Income Model -- -- --
Putnam Income Model Index 6.34%5.04%4.68%

Past performance is not a guarantee of future results. An investment in these strategies can lose value. Returns are stated in U.S. dollars and include the reinvestment of dividends and interest. Returns less than one year are not annualized. Net-of-fees returns do not reflect the deduction of a management fee but are net of all fees and expenses applicable to the underlying funds within the model portfolio. Composites include all fully discretionary, actual invested accounts managed to represent the model portfolio strategy. Putnam does not have investment discretion over or place trade orders for any portfolios or accounts derived from the Putnam Multi-Asset Model Portfolios. Performance of accounts managed in accordance with the model by a third-party firm may differ from the performance shown.

 

Performance snapshot

1 mt. as of 10/31/20 0.04%

Allocations

Active Putnam funds 59.9%
Putnam Income Fund 34.4%
Putnam Mortgage Securities Fund 22.5%
Putnam Ultra Short Duration Income Fund 3.0%
Passive ETFs 40.1%
Xtrackers USd High Yield Corporate Bond ETF 20.0%
iShares Core US Aggregate Bond ETF 13.6%
iShares 7-10 Year Treasury Bond ETF 6.5%
Weighted average expense ratio 0.34%


Each model portfolio is managed to contain approximate underlying fund exposures as shown. Target allocations can vary +/-10%. The invested Putnam model portfolio may differ from its target allocation due to market conditions and other factors. Allocations may not match a client's actual experience from an account managed in accordance with the model portfolio allocation. Actual client accounts may differ from the model allocation and may hold cash.

Weighted average expense ratio is the weighted average of each underlying fund's expense ratio based on current target allocations and as of most recent prospectus available for each fund.

Portfolio composition as of 07/31/20

U.S. core fixed income 77.0%
U.S. high-yeld fixed income 20.0%
Short duration income 3.0%

The Putnam Income Model Index is a benchmark administered by Putnam Management, comprising 77% the Bloomberg Barclays U.S. Aggregate Bond Index, 20% the Bloomberg Barclays U.S. Corporate High Yield Index, and 3% the ICE BofA U.S. 3-Month Treasury Bill Index. The custom index is rebalanced on a quarterly basis. Indexes are unmanaged and do not incur expenses. You cannot invest directly in an index. The Bloomberg Barclays U.S. Aggregate Bond Index is an unmanaged index of U.S. investment-grade fixed-income securities. The Bloomberg Barclays U.S. Corporate High Yield Index measures the USD-denominated, high yield, fixed-rate corporate bond market. The ICE BofA U.S. 3-Month Treasury Bill Index is an unmanaged index that seeks to measure the performance of U.S. Treasury bills available in the marketplace.

Putnam Multi-Asset Model Portfolios invest in non-Putnam exchange-traded funds and exclusively in Putnam mutual funds. Putnam does not currently charge overlay fees for portfolio management of the Putnam Multi-Asset Model Portfolios; however, it earns fees from the Putnam mutual funds in which the Portfolios invest. Asset allocation strategies and diversification do not assure a profit and do not protect against loss. As with any investment, there is a potential for profit as well as the possibility of loss.

When selecting active funds for inclusion in a Putnam Multi-Asset Model Portfolio, Putnam generally expects to select a proprietary fund without considering or canvassing the universe of all investable funds for inclusion in the model portfolio. To the extent that an appropriate proprietary fund is not available, only then will Putnam consider passive ETFs for inclusion in the model portfolio. Passive ETFs are non-Putnam products and are selected for inclusion based on several characteristics, such as fund expenses, liquidity, and desired asset class exposure. Any passive ETF used in the Multi-Asset Model Portfolios shall be selected by Putnam, in its sole discretion. Putnam does not currently charge overlay fees for portfolio management of the Putnam Multi-Asset Model Portfolios; however, it earns fees from the Putnam mutual funds in which the Portfolios invest. Prior to making any investment or financial decisions, any recipients of this material should evaluate the overall fees and charges of the firm as well as the services provided.

Putnam Multi-Asset Model Portfolios are provided for illustrative and educational purposes only, do not constitute personalized investment advice or an investment recommendation from Putnam and are intended for use only by financial professionals, with other information, as a resource to help build a portfolio or as an input in the development of investment advice for its own clients. The implementation of, or reliance on, a model portfolio strategy is left to the discretion of the financial professional. Such financial professionals are responsible for making their own independent judgment as to how to use Putnam's Multi-Asset Model Portfolios. Putnam does not have investment discretion over or place trade orders for any portfolios or accounts derived from the Putnam Multi-Asset Model Portfolios.

Investing involves risk, including the loss of principal. Risks apply to those underlying funds in the allocation of the models, there is no guarantee the funds' investment objectives will be achieved. Carefully consider the funds within the model portfolios' investment objectives, risk factors, and chargers and expenses before investing. This and other information can be found in the funds' prospectuses which may be obtained by visiting the respective fund information page or fund family websites. Our allocation of investments among the underlying funds may hurt performance. Therefore, the model portfolio's performance is subject to the risks that may affect the performance of the underlying funds. In addition, investors will bear the fees and expenses of the underlying funds included in the models.