NPORT-EX 2 b_ec2nport022831.htm QUARTERLY PORTFOLIO HOLDINGS
Putnam Dynamic Risk Allocation Fund
The fund's portfolio
2/28/22 (Unaudited)


COMMON STOCKS (9.8%)(a)
        Shares Value
Basic materials (1.0%)
Arkema SA (France) 49 $6,438
BHP Group, Ltd. (Australia) 573 19,301
BlueScope Steel, Ltd. (Australia) 1,081 15,972
Brenntag SE (Germany) 164 13,769
Compagnie de Saint-Gobain (France) 262 16,109
Covestro AG (Germany) 211 11,164
CRH PLC (Ireland) 227 10,224
Eiffage SA (France) 101 10,233
EVRAZ PLC (United Kingdom) 597 1,155
LANXESS AG (Germany) 52 2,541
Rio Tinto PLC (United Kingdom) 347 26,933
Shin-Etsu Chemical Co., Ltd. (Japan) 100 15,458
149,297
Capital goods (0.5%)
CNH Industrial NV (United Kingdom) 866 12,220
Daikin Industries, Ltd. (Japan) 100 18,550
GEA Group AG (Germany) 126 5,521
Koito Manufacturing Co., Ltd. (Japan) 100 5,170
Legrand SA (France) 67 6,285
Mitsubishi Electric Corp. (Japan) 500 6,026
Sandvik AB (Sweden) 620 13,355
67,127
Communication services (0.3%)
KDDI Corp. (Japan) 600 19,628
Koninklijke KPN NV (Netherlands) 2,568 8,776
Telstra Corp., Ltd. (Australia) 5,661 16,328
44,732
Consumer cyclicals (1.6%)
Aristocrat Leisure, Ltd. (Australia) 349 9,638
Berkeley Group Holdings PLC (The) (United Kingdom) 69 3,576
Brambles, Ltd. (Australia) 711 5,126
CIE Generale Des Etablissements Michelin SCA (France) 34 4,677
CK Hutchison Holdings, Ltd. (Hong Kong) 1,000 7,006
Daiwa House Industry Co., Ltd. (Japan) 300 8,554
Entain PLC (United Kingdom)(NON) 744 16,613
Hermes International (France) 12 16,411
Industria de Diseno Textil SA (Spain) 170 4,471
Iveco Group NV (Italy)(NON) 173 1,444
JD Sports Fashion PLC (United Kingdom) 2,241 4,489
La Francaise des Jeux SAEM (France) 101 4,164
LVMH Moet Hennessy Louis Vuitton SA (France) 7 5,077
Nitori Holdings Co., Ltd. (Japan) 100 15,093
Pandora A/S (Denmark) 100 10,187
Porsche Automobil Holding SE (Preference) (Germany) 137 13,922
Publicis Groupe SA (France) 253 16,706
Ryohin Keikaku Co., Ltd. (Japan) 200 2,949
SGS SA (Switzerland) 4 11,376
Sofina SA (Belgium) 5 1,927
Sony Group Corp. (Japan) 200 20,477
Stellantis NV (Italy) 995 17,817
Toyota Motor Corp. (Japan) 200 3,638
Volkswagen AG (Preference) (Germany) 17 3,393
Volvo AB Class B (Sweden) 626 12,000
Wesfarmers, Ltd. (Australia) 442 15,522
236,253
Consumer staples (1.2%)
Carlsberg A/S Class B (Denmark) 34 4,945
Coca-Cola Europacific Partners PLC (United Kingdom) 171 8,757
Coca-Cola HBC AG (Switzerland) 199 5,022
Coles Group, Ltd. (Australia) 1,114 14,113
Diageo PLC (United Kingdom) 426 21,140
Ferguson PLC (United Kingdom) 119 18,073
Imperial Brands PLC (United Kingdom) 623 13,692
ITOCHU Corp. (Japan) 300 9,790
Koninklijke Ahold Delhaize NV (Netherlands) 541 16,629
L'Oreal SA (France) 56 22,265
Nestle SA (Switzerland) 165 21,542
Swedish Match AB (Sweden) 914 6,676
Unilever PLC (United Kingdom) 64 3,222
Yakult Honsha Co., Ltd. (Japan) 100 5,426
171,292
Energy (0.5%)
BP PLC (United Kingdom) 3,340 16,285
DCC PLC (Ireland) 38 2,967
Equinor ASA (Norway) 682 21,507
Raspadskaya OJSC (Russia)(F) 254 559
Shell PLC (United Kingdom) 1,393 36,953
78,271
Financials (1.9%)
3i Group PLC (United Kingdom) 531 9,394
Allianz SE (Germany) 104 23,646
Aviva PLC (United Kingdom) 2,156 12,015
Banco Bilbao Vizcaya Argentaria SA (Spain) 2,687 15,858
Bank Leumi Le-Israel BM (Israel) 1,516 16,410
BOC Hong Kong Holdings, Ltd. (Hong Kong) 2,000 7,182
CK Asset Holdings, Ltd. (Hong Kong) 2,133 13,471
Dai-ichi Life Holdings, Inc. (Japan) 400 8,394
DBS Group Holdings, Ltd. (Singapore) 800 20,079
Dexus (Australia)(R) 631 5,032
Gjensidige Forsikring ASA (Norway) 105 2,597
Goodman Group (Australia)(R) 1,013 16,451
Iida Group Holdings Co., Ltd. (Japan) 200 3,691
Investor AB Class B (Sweden) 695 14,027
Israel Discount Bank, Ltd. Class A (Israel) 1,158 7,630
Link REIT (The) (Hong Kong)(R) 200 1,614
Mizrahi Tefahot Bank, Ltd. (Israel) 36 1,407
NN Group NV (Netherlands) 32 1,528
Partners Group Holding AG (Switzerland) 12 16,071
Skandinaviska Enskilda Banken AB (Sweden) 739 8,528
Sumitomo Mitsui Financial Group, Inc. (Japan) 500 17,821
Sumitomo Realty & Development Co., Ltd. (Japan) 100 2,953
UBS Group AG (Switzerland) 1,165 21,374
United Overseas Bank, Ltd. (Singapore) 800 17,667
Zurich Insurance Group AG (Switzerland) 14 6,397
271,237
Government (—%)
Poste Italiane SpA (Italy) 226 2,597
2,597
Health care (1.1%)
Fisher & Paykel Healthcare Corp., Ltd. (New Zealand) 121 2,272
Getinge AB Class B (Sweden) 183 7,059
GlaxoSmithKline PLC (United Kingdom) 706 14,616
Ipsen SA (France) 34 3,946
Merck KGaA (Germany) 74 14,732
Novartis AG (Switzerland) 354 30,911
Novo Nordisk A/S Class B (Denmark) 293 30,171
Roche Holding AG (Switzerland) 105 40,058
Sartorius Stedim Biotech (France) 17 6,467
Sonic Healthcare, Ltd. (Australia) 474 12,188
162,420
Technology (1.0%)
ASML Holding NV (Netherlands) 36 23,731
Brother Industries, Ltd. (Japan) 200 3,645
Capgemini SE (France) 57 11,997
Fujitsu, Ltd. (Japan) 100 14,638
Hoya Corp. (Japan) 100 13,173
Nomura Research Institute, Ltd. (Japan) 400 13,969
Omron Corp. (Japan) 100 6,787
Sage Group PLC (The) (United Kingdom) 1,107 10,427
SCSK Corp. (Japan) 300 5,134
Shimadzu Corp. (Japan) 300 10,761
SoftBank Group Corp. (Japan) 300 13,463
Square Enix Holdings Co., Ltd. (Japan) 200 9,665
Thales SA (France) 17 1,946
139,336
Transportation (0.3%)
A.P. Moeller-Maersck A/S Class B (Denmark) 1 3,171
Deutsche Post AG (Germany) 344 17,417
Nippon Yusen KK (Japan) 200 18,640
Yamato Holdings Co., Ltd. (Japan) 300 5,863
45,091
Utilities and power (0.4%)
CLP Holdings, Ltd. (Hong Kong) 1,000 10,179
E.ON SE (Germany) 290 3,940
Electricite De France SA (France) 625 5,697
Fortum OYJ (Finland) 571 11,933
Glow Energy PCL (Thailand)(F) 400 —
Osaka Gas Co., Ltd. (Japan) 300 5,517
Tokyo Gas Co., Ltd. (Japan) 800 16,425
53,691
Total common stocks (cost $1,134,232) $1,421,344








U.S. TREASURY OBLIGATIONS (1.1%)(a)
        Principal amount Value
U.S. Treasury Notes
1.625%, 5/15/26(i) $143,000 $142,960
0.375%, 1/31/26(i) 11,000 10,437
Total U.S. treasury obligations (cost $153,397) $153,397








SHORT-TERM INVESTMENTS (78.3%)(a)
        Principal amount/shares Value
CAFCO, LLC asset backed commercial paper 0.230%, 4/22/22 $250,000 $249,875
Liberty Street Funding, LLC asset backed commercial paper 0.140%, 3/1/22 250,000 250,000
NRW.Bank commercial paper 0.180%, 3/1/22 250,000 250,000
Putnam Short Term Investment Fund Class P 0.12%(AFF) Shares 9,427,729 9,427,729
Skandinaviska Enskilda Banken AB commercial paper 0.220%, 3/24/22 $250,000 249,977
U.S. Treasury Bills 0.168%, 4/28/22(SEGSF) 400,000 399,881
U.S. Treasury Bills 0.183%, 4/26/22(SEG)(SEGSF)(SEGCCS) 400,000 399,885
U.S. Treasury Cash Management Bills 0.288%, 5/3/22(SEG) 100,000 99,959
Total short-term investments (cost $11,327,342) $11,327,306
TOTAL INVESTMENTS
Total investments (cost $12,614,971) $12,902,047








FORWARD CURRENCY CONTRACTS at 2/28/22 (aggregate face value $47,333,721) (Unaudited)
  Counterparty Currency Contract type* Delivery date Value Aggregate face value Unrealized
appreciation/
(depreciation)
Bank of America N.A.
British Pound Buy 3/16/22 $685,052 $680,039 $5,013
Euro Sell 3/16/22 1,155,869 1,169,422 13,553
Swedish Krona Sell 3/16/22 327 344 17
Swiss Franc Buy 3/16/22 100,487 100,049 438
Swiss Franc Sell 3/16/22 100,487 100,508 21
Barclays Bank PLC
British Pound Buy 3/16/22 134,568 131,226 3,342
Euro Buy 3/16/22 250,515 253,426 (2,911)
Swiss Franc Buy 3/16/22 178,279 177,513 766
Swiss Franc Sell 3/16/22 178,279 178,377 98
Citibank, N.A.
British Pound Buy 3/16/22 702,225 698,128 4,097
Canadian Dollar Buy 4/20/22 1,879,014 1,869,384 9,630
Danish Krone Buy 3/16/22 4,797 4,861 (64)
Euro Sell 3/16/22 302,570 306,726 4,156
Swedish Krona Buy 3/16/22 10,223 10,651 (428)
Swedish Krona Sell 3/16/22 10,223 10,725 502
Swiss Franc Buy 3/16/22 463,373 462,616 757
Credit Suisse International
British Pound Buy 3/16/22 207,689 204,902 2,787
British Pound Sell 3/16/22 207,689 206,100 (1,589)
Euro Buy 3/16/22 169,964 171,248 (1,284)
Euro Sell 3/16/22 169,964 172,160 2,196
Goldman Sachs International
Australian Dollar Sell 4/20/22 540,978 533,409 (7,569)
British Pound Buy 3/16/22 442,748 443,564 (816)
Chinese Yuan (Offshore) Buy 5/18/22 21,277 21,100 177
Euro Buy 3/16/22 845,895 856,712 (10,817)
Norwegian Krone Buy 3/16/22 35,887 34,776 1,111
Norwegian Krone Sell 3/16/22 35,887 34,902 (985)
Polish Zloty Buy 3/16/22 33,316 34,271 (955)
Swiss Franc Sell 3/16/22 464,464 465,421 957
HSBC Bank USA, National Association
British Pound Buy 3/16/22 99,015 100,189 (1,174)
Euro Buy 3/16/22 5,335,084 5,406,151 (71,067)
Hong Kong Dollar Sell 5/18/22 1,805 1,810 5
Swedish Krona Buy 3/16/22 39,213 40,018 (805)
Swiss Franc Sell 3/16/22 803,019 804,100 1,081
JPMorgan Chase Bank N.A.
Australian Dollar Buy 4/20/22 62,144 61,069 1,075
British Pound Sell 3/16/22 355,406 352,068 (3,338)
Euro Buy 3/16/22 6,208,802 6,286,314 (77,512)
Japanese Yen Buy 5/18/22 1,220,354 1,226,326 (5,972)
Norwegian Krone Sell 3/16/22 8,756 8,455 (301)
Singapore Dollar Buy 5/18/22 590 595 (5)
Swiss Franc Buy 3/16/22 914,962 917,669 (2,707)
Morgan Stanley & Co. International PLC
Australian Dollar Buy 4/20/22 33,579 32,956 623
British Pound Sell 3/16/22 721,545 712,644 (8,901)
Canadian Dollar Sell 4/20/22 52,631 52,510 (121)
Euro Buy 3/16/22 3,379,316 3,426,187 (46,871)
Swedish Krona Buy 3/16/22 27,385 28,667 (1,282)
Swedish Krona Sell 3/16/22 27,385 28,552 1,167
Swiss Franc Sell 3/16/22 83,793 84,407 614
NatWest Markets PLC
British Pound Sell 3/16/22 530,224 525,474 (4,750)
Euro Sell 3/16/22 1,008,006 1,021,308 13,302
Swedish Krona Sell 3/16/22 32,908 34,115 1,207
Swiss Franc Buy 3/16/22 287,821 287,980 (159)
Swiss Franc Sell 3/16/22 287,821 286,549 (1,272)
State Street Bank and Trust Co.
Australian Dollar Sell 4/20/22 353,165 348,067 (5,098)
British Pound Buy 3/16/22 570,876 564,793 6,083
Canadian Dollar Sell 4/20/22 1,337,080 1,329,838 (7,242)
Euro Sell 3/16/22 7,524,651 7,629,452 104,801
Hong Kong Dollar Buy 5/18/22 39,512 39,616 (104)
Israeli Shekel Buy 4/20/22 10,603 10,421 182
Swedish Krona Buy 3/16/22 8,428 8,845 (417)
Swedish Krona Sell 3/16/22 8,428 8,788 360
Swiss Franc Sell 3/16/22 70,482 68,968 (1,514)
Toronto-Dominion Bank
British Pound Sell 3/16/22 128,799 128,337 (462)
Euro Buy 3/16/22 89,414 90,124 (710)
Euro Sell 3/16/22 89,414 90,579 1,165
Norwegian Krone Buy 3/16/22 13,497 13,106 391
Norwegian Krone Sell 3/16/22 13,497 13,160 (337)
UBS AG
Australian Dollar Buy 4/20/22 914,640 901,971 12,669
British Pound Sell 3/16/22 735,230 731,660 (3,570)
Canadian Dollar Sell 4/20/22 64,704 64,374 (330)
Chinese Yuan (Offshore) Buy 5/18/22 36,869 36,536 333
Euro Sell 3/16/22 3,349,138 3,387,017 37,879
Hong Kong Dollar Sell 5/18/22 8,358 8,382 24
Swiss Franc Buy 3/16/22 134,091 132,635 1,456
WestPac Banking Corp.
British Pound Buy 3/16/22 247,268 245,108 2,160
Euro Sell 3/16/22 417,675 423,271 5,596
Unrealized appreciation 241,791
Unrealized (depreciation) (273,439)
Total $(31,648)
* The exchange currency for all contracts listed is the United States Dollar.








FUTURES CONTRACTS OUTSTANDING at 2/28/22 (Unaudited)
    Number of contracts Notional
amount		 Value Expiration date Unrealized
appreciation/
(depreciation)
Canadian Government Bond 10 yr (Long) 17 $1,833,049 $1,833,049 Jun-22 $11,079
Euro-BTP Italian Government Bond (Long) 10 1,582,644 1,582,644 Mar-22 (79,305)
Euro-Bund 10 yr (Long) 8 1,498,349 1,498,348 Mar-22 (55,271)
Euro-OAT 10 yr (Long) 9 1,597,243 1,597,243 Mar-22 (64,165)
Japanese Government Bond 10 yr (Long) 2 2,618,188 2,618,188 Mar-22 (28,019)
MSCI EAFE Index (Long) 1 108,955 107,990 Mar-22 (6,371)
S&P 500 Index E-Mini (Long) 8 1,749,576 1,747,200 Mar-22 (68,396)
U.K. Gilt 10 yr (Long) 12 1,981,342 1,981,342 Jun-22 11,241
U.S. Treasury Note 5 yr (Short) 19 2,247,344 2,247,344 Jun-22 (16,668)
U.S. Treasury Note Ultra 10 yr (Long) 34 4,805,156 4,805,156 Jun-22 31,002
Unrealized appreciation 53,322
Unrealized (depreciation) (318,195)
Total $(264,873)










CENTRALLY CLEARED INTEREST RATE SWAP CONTRACTS OUTSTANDING at 2/28/22 (Unaudited)
  Notional amount Value   Upfront premium received (paid)   Termi-
nation date		 Payments made by fund   Payments received
by fund		 Unrealized
appreciation
$440,000 $12,910 $(6) 1/3/32 1.3265% — Annually Secured Overnight Financing Rate — Annually $12,632
Total $(6) $12,632








OTC TOTAL RETURN SWAP CONTRACTS OUTSTANDING at 2/28/22 (Unaudited)
  Swap counterparty/
notional amount		 Value   Upfront premium received (paid)   Termi-
nation
date		 Payments received
(paid) by fund		   Total return received by or paid by fund Unrealized
appreciation/
(depreciation)
Bank of America N.A.
$808,643 $790,219 $— 2/15/23 (Secured Overnight Financing Rate plus 0.22%) — Monthly A basket (MLFCF15) of common stocks — Monthly* $(17,963)
815,437 799,835 — 2/15/23 Secured Overnight Financing Rate plus 0.05% — Monthly Russell 1000 Total Return Index — Monthly 15,629
Citibank, N.A.
408,945 404,200 — 9/28/22 (Secured Overnight Financing Rate plus 0.45%) — Monthly S&P 500 Total Return 4 Jan 1988 Index — Monthly (4,901)
JPMorgan Chase Bank N.A.
1,486,123 1,451,446 — 2/7/23 (Secured Overnight Financing Rate plus 0.43%) — Monthly S&P 500 Total Return 4 Jan 1988 Index — Monthly (36,986)
Upfront premium received — Unrealized appreciation 15,629
Upfront premium (paid) — Unrealized (depreciation) (59,850)
Total $— Total $(44,221)
* The 50 largest components, and any individual component greater than 1% of basket value, are shown below.








A BASKET (MLFCF15) OF COMMON STOCKS
  Common stocks Sector Shares Value Percentage value
Apple, Inc. Technology 333 $55,045 6.97%
Alphabet, Inc. Class A Technology 14 38,060 4.82%
Microsoft Corp. Technology 121 36,197 4.58%
Amazon.com, Inc. Consumer cyclicals 9 27,799 3.52%
NVIDIA Corp. Technology 84 20,430 2.59%
JPMorgan Chase & Co. Financials 122 17,364 2.20%
Qualcomm, Inc. Technology 81 13,914 1.76%
Merck & Co., Inc. Health care 177 13,586 1.72%
Accenture PLC Class A Technology 43 13,519 1.71%
Walmart, Inc. Consumer cyclicals 94 12,747 1.61%
Goldman Sachs Group, Inc. (The) Financials 34 11,706 1.48%
Intuit, Inc. Technology 24 11,520 1.46%
Abbott Laboratories Health care 90 10,837 1.37%
Citigroup, Inc. Financials 174 10,280 1.30%
Philip Morris International, Inc. Consumer staples 91 9,235 1.17%
MetLife, Inc. Financials 134 9,074 1.15%
Adobe, Inc. Technology 19 8,962 1.13%
Cisco Systems, Inc./Delaware Technology 158 8,824 1.12%
Procter & Gamble Co. (The) Consumer staples 56 8,665 1.10%
Coca-Cola Co. (The) Consumer staples 131 8,172 1.03%
Ford Motor Co. Consumer cyclicals 453 7,960 1.01%
Vertex Pharmaceuticals, Inc. Health care 34 7,934 1.00%
DuPont de Nemours, Inc. Basic materials 99 7,667 0.97%
Target Corp. Consumer cyclicals 38 7,559 0.96%
AT&T, Inc. Communication services 314 7,436 0.94%
AbbVie, Inc. Health care 49 7,229 0.91%
AutoZone, Inc. Consumer cyclicals 4 7,213 0.91%
McDonald's Corp. Consumer staples 29 7,193 0.91%
O'Reilly Automotive, Inc. Consumer cyclicals 11 7,192 0.91%
Snowflake, Inc. Class A Technology 27 7,084 0.90%
Colgate-Palmolive Co. Consumer staples 91 7,004 0.89%
Synopsys, Inc. Technology 22 6,916 0.88%
CSX Corp. Transportation 198 6,706 0.85%
Exxon Mobil Corp. Energy 76 5,948 0.75%
General Dynamics Corp. Capital goods 25 5,944 0.75%
Verizon Communications, Inc. Communication services 109 5,839 0.74%
Fortinet, Inc. Technology 16 5,554 0.70%
Meta Platforms, Inc. Class A Technology 26 5,530 0.70%
Cadence Design Systems, Inc. Technology 36 5,466 0.69%
Ameriprise Financial, Inc. Financials 17 5,202 0.66%
Chevron Corp. Energy 35 5,065 0.64%
American Electric Power Co., Inc. Utilities and power 55 5,012 0.63%
Tesla, Inc. Consumer cyclicals 6 4,942 0.63%
Marriott International, Inc./MD Class A Consumer cyclicals 29 4,892 0.62%
Edwards Lifesciences Corp. Health care 43 4,883 0.62%
Medtronic PLC Health care 46 4,825 0.61%
Regeneron Pharmaceuticals, Inc. Health care 8 4,672 0.59%
Deere & Co. Capital goods 13 4,629 0.59%
Fortive Corp. Capital goods 71 4,588 0.58%
AMETEK, Inc. Conglomerates 35 4,503 0.57%








CENTRALLY CLEARED TOTAL RETURN SWAP CONTRACTS OUTSTANDING at 2/28/22 (Unaudited)
  Notional amount Value   Upfront premium received (paid)   Termi-
nation
date		 Payments received
(paid) by fund		   Total return received by or paid by fund Unrealized depreciation
$395,000 $24,296 $1,278 1/15/32 2.78% — At maturity USA Non-revised Consumer Price Index- Urban (CPI-U) — At maturity $(23,019)
1,740,000 81,763 656 9/13/26 2.7375% — At maturity USA Non-revised Consumer Price Index- Urban (CPI-U) — At maturity (81,106)
Total $1,934 $(104,125)










Key to holding's abbreviations
OJSC Open Joint Stock Company
OTC Over-the-counter
Notes to the fund's portfolio
Unless noted otherwise, the notes to the fund's portfolio are for the close of the fund's reporting period, which ran from June 1, 2021 through February 28, 2022 (the reporting period). Within the following notes to the portfolio, references to "Putnam Management" represent Putnam Investment Management, LLC, the fund's manager, an indirect wholly-owned subsidiary of Putnam Investments, LLC, references to "ASC 820" represent Accounting Standards Codification 820 Fair Value Measurements and Disclosures and references to "OTC", if any, represent over-the-counter.
(a) Percentages indicated are based on net assets of $14,465,132.
(NON) This security is non-income-producing.
(AFF) Affiliated company. For investments in Putnam Short Term Investment Fund, the rate quoted in the security description is the annualized 7-day yield of the fund at the close of the reporting period. Transactions during the period with any company which is under common ownership or control were as follows:
Name of affiliate Fair value
as of
5/31/21		 Purchase
cost		 Sale
proceeds		 Investment
income		 Shares outstanding
and fair
value as of
2/28/22
Short-term investments
Putnam Short Term Investment Fund* $19,944,551 $10,321,491 $20,838,313 $8,818 $9,427,729
Total Short-term investments $19,944,551 $10,321,491 $20,838,313 $8,818 $9,427,729
* Management fees charged to Putnam Short Term Investment Fund have been waived by Putnam Management. There were no realized or unrealized gains or losses during the period.
(SEG) This security, in part or in entirety, was pledged and segregated with the broker to cover margin requirements for futures contracts at the close of the reporting period. Collateral at period end totaled $336,889.
(SEGSF) This security, in part or in entirety, was pledged and segregated with the custodian for collateral on certain derivative contracts at the close of the reporting period. Collateral at period end totaled $222,933.
(SEGCCS) This security, in part or in entirety, was pledged and segregated with the custodian for collateral on the initial margin on certain centrally cleared derivative contracts at the close of the reporting period. Collateral at period end totaled $67,980.
(F) This security is valued by Putnam Management at fair value following procedures approved by the Trustees. Securities are classified as Level 3 for ASC 820 based on the securities' valuation inputs. At the close of the reporting period, fair value pricing was also used for certain foreign securities in the portfolio.
(i) This security was pledged, or purchased with cash that was pledged, to the fund for collateral on certain derivative contracts.
(R) Real Estate Investment Trust.
At the close of the reporting period, the fund maintained liquid assets totaling $336,608 to cover certain derivative contracts.
Unless otherwise noted, the rates quoted in Short-term investments security descriptions represent the weighted average yield to maturity.
The dates shown on debt obligations are the original maturity dates.
Security valuation: Portfolio securities and other investments are valued using policies and procedures adopted by the Board of Trustees. The Trustees have formed a Pricing Committee to oversee the implementation of these procedures and have delegated responsibility for valuing the fund’s assets in accordance with these procedures to Putnam Management. Putnam Management has established an internal Valuation Committee that is responsible for making fair value determinations, evaluating the effectiveness of the pricing policies of the fund and reporting to the Pricing Committee.
Investments for which market quotations are readily available are valued at the last reported sales price on their principal exchange, or official closing price for certain markets, and are classified as Level 1 securities under ASC 820. If no sales are reported, as in the case of some securities that are traded OTC, a security is valued at its last reported bid price and is generally categorized as a Level 2 security.
Investments in open-end investment companies (excluding exchange-traded funds), if any, which can be classified as Level 1 or Level 2 securities, are valued based on their net asset value. The net asset value of such investment companies equals the total value of their assets less their liabilities and divided by the number of their outstanding shares.
Market quotations are not considered to be readily available for certain debt obligations (including short-term investments with remaining maturities of 60 days or less) and other investments; such investments are valued on the basis of valuations furnished by an independent pricing service approved by the Trustees or dealers selected by Putnam Management. Such services or dealers determine valuations for normal institutional-size trading units of such securities using methods based on market transactions for comparable securities and various relationships, generally recognized by institutional traders, between securities (which consider such factors as security prices, yields, maturities and ratings). These securities will generally be categorized as Level 2.
Many securities markets and exchanges outside the U.S. close prior to the scheduled close of the New York Stock Exchange and therefore the closing prices for securities in such markets or on such exchanges may not fully reflect events that occur after such close but before the scheduled close of the New York Stock Exchange. Accordingly, on certain days, the fund will fair value certain foreign equity securities taking into account multiple factors including movements in the U.S. securities markets, currency valuations and comparisons to the valuation of American Depository Receipts, exchange-traded funds and futures contracts. The foreign equity securities, which would generally be classified as Level 1 securities, will be transferred to Level 2 of the fair value hierarchy when they are valued at fair value. The number of days on which fair value prices will be used will depend on market activity and it is possible that fair value prices will be used by the fund to a significant extent. At the close of the reporting period, fair value pricing was used for certain foreign securities in the portfolio. Securities quoted in foreign currencies, if any, are translated into U.S. dollars at the current exchange rate.
To the extent a pricing service or dealer is unable to value a security or provides a valuation that Putnam Management does not believe accurately reflects the security's fair value, the security will be valued at fair value by Putnam Management in accordance with policies and procedures approved by the Trustees. Certain investments, including certain restricted and illiquid securities and derivatives, are also valued at fair value following procedures approved by the Trustees. These valuations consider such factors as significant market or specific security events such as interest rate or credit quality changes, various relationships with other securities, discount rates, U.S. Treasury, U.S. swap and credit yields, index levels, convexity exposures, recovery rates, sales and other multiples and resale restrictions. These securities are classified as Level 2 or as Level 3 depending on the priority of the significant inputs.
To assess the continuing appropriateness of fair valuations, the Valuation Committee reviews and affirms the reasonableness of such valuations on a regular basis after considering all relevant information that is reasonably available. Such valuations and procedures are reviewed periodically by the Trustees. The fair value of securities is generally determined as the amount that the fund could reasonably expect to realize from an orderly disposition of such securities over a reasonable period of time. By its nature, a fair value price is a good faith estimate of the value of a security in a current sale and does not reflect an actual market price, which may be different by a material amount.
Futures contracts: The fund used futures contracts to manage exposure to market risk, to hedge prepayment risk, to hedge interest rate risk, to gain exposure to interest rates and to equitize cash.
The potential risk to the fund is that the change in value of futures contracts may not correspond to the change in value of the hedged instruments. In addition, losses may arise from changes in the value of the underlying instruments, if there is an illiquid secondary market for the contracts, if interest or exchange rates move unexpectedly or if the counterparty to the contract is unable to perform. With futures, there is minimal counterparty credit risk to the fund since futures are exchange traded and the exchange’s clearinghouse, as counterparty to all exchange traded futures, guarantees the futures against default. When the contract is closed, the fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed.
Futures contracts are valued at the quoted daily settlement prices established by the exchange on which they trade. The fund and the broker agree to exchange an amount of cash equal to the daily fluctuation in the value of the futures contract. Such receipts or payments are known as “variation margin”.
For the fund's average number of futures contracts, see the appropriate table at the end of these footnotes.
Forward currency contracts: The fund buys and sells forward currency contracts, which are agreements between two parties to buy and sell currencies at a set price on a future date. These contracts were used to hedge foreign exchange risk and to gain exposure to currencies.
The U.S. dollar value of forward currency contracts is determined using current forward currency exchange rates supplied by a quotation service. The fair value of the contract will fluctuate with changes in currency exchange rates. The contract is marked to market daily and the change in fair value is recorded as an unrealized gain or loss. The fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed when the contract matures or by delivery of the currency. The fund could be exposed to risk if the value of the currency changes unfavorably, if the counterparties to the contracts are unable to meet the terms of their contracts or if the fund is unable to enter into a closing position.
For the fund's average contract amount on forward currency contracts, see the appropriate table at the end of these footnotes.
Interest rate swap contracts: The fund entered into OTC and/or centrally cleared interest rate swap contracts, which are arrangements between two parties to exchange cash flows based on a notional principal amount, to hedge interest rate risk, to gain exposure on interest rates and to hedge prepayment risk.
An OTC and centrally cleared interest rate swap can be purchased or sold with an upfront premium. For OTC interest rate swap contracts, an upfront payment received by the fund is recorded as a liability on the fund's books. An upfront payment made by the fund is recorded as an asset on the fund's books. OTC and centrally cleared interest rate swap contracts are marked to market daily based upon quotations from an independent pricing service or market makers. Any change is recorded as an unrealized gain or loss on OTC interest rate swaps. Daily fluctuations in the value of centrally cleared interest rate swaps are settled through a central clearing agent and are recorded as unrealized gain or loss. Payments, including upfront premiums, received or made are recorded as realized gains or losses at the reset date or the closing of the contract. Certain OTC and centrally cleared interest rate swap contracts may include extended effective dates. Payments related to these swap contracts are accrued based on the terms of the contract.
The fund could be exposed to credit or market risk due to unfavorable changes in the fluctuation of interest rates or if the counterparty defaults, in the case of OTC interest rate contracts, or the central clearing agency or a clearing member defaults, in the case of centrally cleared interest rate swap contracts, on its respective obligation to perform under the contract. The fund’s maximum risk of loss from counterparty risk or central clearing risk is the fair value of the contract. This risk may be mitigated for OTC interest rate swap contracts by having a master netting arrangement between the fund and the counterparty and for centrally cleared interest rate swap contracts through the daily exchange of variation margin. There is minimal counterparty risk with respect to centrally cleared interest rate swap contracts due to the clearinghouse guarantee fund and other resources that are available in the event of a clearing member default.
For the fund's average notional amount on interest rate swap contracts, see the appropriate table at the end of these footnotes.
Total return swap contracts: The fund entered into OTC and/or centrally cleared total return swap contracts, which are arrangements to exchange a market-linked return for a periodic payment, both based on a notional principal amount, to hedge sector exposure, to manage exposure to specific sectors or industries, to manage exposure to specific securities, to gain exposure to a basket of securities, to gain exposure to specific markets or countries, to gain exposure to specific sectors or industries, to generate additional income for the portfolio.
To the extent that the total return of the security, index or other financial measure underlying the transaction exceeds or falls short of the offsetting interest rate obligation, the fund will receive a payment from or make a payment to the counterparty. OTC and/or centrally cleared total return swap contracts are marked to market daily based upon quotations from an independent pricing service or market maker. Any change is recorded as an unrealized gain or loss on OTC total return swaps. Daily fluctuations in the value of centrally cleared total return swaps are settled through a central clearing agent and are recorded as unrealized gain or loss. Payments received or made are recorded as realized gains or losses. Certain OTC and/or centrally cleared total return swap contracts may include extended effective dates. Payments related to these swap contracts are accrued based on the terms of the contract. The fund could be exposed to credit or market risk due to unfavorable changes in the fluctuation of interest rates or in the price of the underlying security or index, the possibility that there is no liquid market for these agreements or that the counterparty may default on its obligation to perform. The fund’s maximum risk of loss from counterparty risk or central clearing risk is the fair value of the contract. This risk may be mitigated for OTC total return swap contracts by having a master netting arrangement between the fund and the counterparty and for centrally cleared total return swap contracts through the daily exchange of variation margin. There is minimal counterparty risk with respect to centrally cleared total return swap contracts due to the clearinghouse guarantee fund and other resources that are available in the event of a clearing member default.
For the fund's average notional amount on total return swap contracts, see the appropriate table at the end of these footnotes.
Master agreements: The fund is a party to ISDA (International Swaps and Derivatives Association, Inc.) Master Agreements that govern OTC derivative and foreign exchange contracts and Master Securities Forward Transaction Agreements that govern transactions involving mortgage-backed and other asset-backed securities that may result in delayed delivery (Master Agreements) with certain counterparties entered into from time to time. The Master Agreements may contain provisions regarding, among other things, the parties' general obligations, representations, agreements, collateral requirements, events of default and early termination. With respect to certain counterparties, in accordance with the terms of the Master Agreements, collateral posted to the fund is held in a segregated account by the fund's custodian and, with respect to those amounts which can be sold or repledged, are presented in the fund's portfolio.
Collateral pledged by the fund is segregated by the fund’s custodian and identified in the fund’s portfolio. Collateral can be in the form of cash or debt securities issued by the U.S. Government or related agencies or other securities as agreed to by the fund and the applicable counterparty. Collateral requirements are determined based on the fund’s net position with each counterparty.
With respect to ISDA Master Agreements, termination events applicable to the fund may occur upon a decline in the fund’s net assets below a specified threshold over a certain period of time. Termination events applicable to counterparties may occur upon a decline in the counterparty’s long-term or short-term credit ratings below a specified level. In each case, upon occurrence, the other party may elect to terminate early and cause settlement of all derivative and foreign exchange contracts outstanding, including the payment of any losses and costs resulting from such early termination, as reasonably determined by the terminating party. Any decision by one or more of the fund’s counterparties to elect early termination could impact the fund’s future derivative activity.
As of the close of the reporting period, due to a decrease in the fund's net asset value during the year, such counterparties were entitled to elect, but had not yet elected, to terminate early, and cause settlement of all outstanding derivative and foreign exchange contracts outstanding under the applicable Master Agreements, including the payment by the fund of any losses and costs resulting from such early termination, as reasonably determined by such counterparty. At the close of the reporting period, the fund had net asset position of $195,505 and net liability position of $271,374 on open derivative contracts subject to the Master Agreements. Collateral posted by the fund at period end for these agreements totaled $222,933 and may include amounts related to unsettled agreements. The fund intends to seek a waiver of or other relief from this provision, from the counterparties.








ASC 820 establishes a three-level hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of the fund's investments. The three levels are defined as follows:
Level 1: Valuations based on quoted prices for identical securities in active markets.
Level 2: Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.
Level 3: Valuations based on inputs that are unobservable and significant to the fair value measurement.
The following is a summary of the inputs used to value the fund's net assets as of the close of the reporting period:
  Valuation inputs
Investments in securities: Level 1 Level 2 Level 3
Common stocks*:
Basic materials $— $149,297 $—
Capital goods — 67,127 —
Communication services — 44,732 —
Consumer cyclicals 1,444 234,809 —
Consumer staples 8,757 162,535 —
Energy — 77,712 559
Financials — 271,237 —
Government — 2,597 —
Health care — 162,420 —
Technology — 139,336 —
Transportation — 45,091 —
Utilities and power — 53,691 —
Total common stocks 10,201 1,410,584 559
U.S. treasury obligations — 153,397 —
Short-term investments — 11,327,306 —
Totals by level $10,201 $12,891,287 $559
  Valuation inputs
Other financial instruments: Level 1 Level 2 Level 3
Forward currency contracts $— $(31,648) $—
Futures contracts (264,873) — —
Interest rate swap contracts — 12,638 —
Total return swap contracts — (150,280) —
Totals by level $(264,873) $(169,290) $—
* Common stock classifications are presented at the sector level, which may differ from the fund's portfolio presentation.
At the start and close of the reporting period, Level 3 investments in securities represented less than 1% of the fund's net assets and were not considered a significant portion of the fund's portfolio.
The volume of activity for the reporting period for any derivative type that was held at the close of the period is listed below and was based on an average of the holdings of that derivative at the end of each fiscal quarter in the reporting period:
Futures contracts (number of contracts) 400
Forward currency contracts (contract amount) $115,000,000
Centrally cleared interest rate swap contracts (notional) $4,300,000
OTC total return swap contracts (notional) $28,100,000
Centrally cleared total return swap contracts (notional) $5,400,000
For additional information regarding the fund please see the fund's most recent annual or semiannual shareholder report filed on the Securities and Exchange Commission's Web site, www.sec.gov, or visit Putnam's Individual Investor Web site at www.putnaminvestments.com