UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number: (811-07513)

Exact name of registrant as specified in charter: Putnam Funds Trust

Address of principal executive offices: One Post Office Square, Boston, Massachusetts 02109

Name and address of agent for service: Robert T. Burns, Vice President
One Post Office Square
Boston, Massachusetts 02109

Copy to:         Bryan Chegwidden, Esq.
Ropes & Gray LLP
1211 Avenue of the Americas
New York, New York 10036

Registrant’s telephone number, including area code: (617) 292-1000

Date of fiscal year end: February 29, 2016

Date of reporting period: May 31, 2015

Item 1. Schedule of Investments:

Putnam Retirement Income Fund Lifestyle 3
The fund's portfolio
5/31/15 (Unaudited)
COMMON STOCKS (29.1%)(a)
			Shares	Value
Banking (1.6%)
Australia & New Zealand Banking Group, Ltd. (Australia)			448	$11,310
Banco Santander SA (Spain)			3,107	22,126
Bank of America Corp.			4,352	71,808
Bank of New York Mellon Corp. (The)			192	8,325
Bendigo and Adelaide Bank, Ltd. (Australia)			1,495	14,006
CaixaBank SA (Spain)			5,030	24,109
Commonwealth Bank of Australia (Australia)			455	29,399
JPMorgan Chase & Co.			1,241	81,633
PNC Financial Services Group, Inc.			101	9,665
Resona Holdings, Inc. (Japan)			7,100	40,511
State Street Corp.			665	51,823
Sumitomo Mitsui Financial Group, Inc. (Japan)			200	9,057
Svenska Handelsbanken AB Class A (Sweden)			3,097	46,638
Swedbank AB Class A (Sweden)			512	12,010
Wells Fargo & Co.			344	19,250
Westpac Banking Corp. (Australia)			1,802	46,021
				497,691
Basic materials (1.3%)
Antofagasta PLC (United Kingdom)			2,685	30,614
Asahi Kasei Corp. (Japan)			2,000	17,685
BASF SE (Germany)			341	31,535
BHP Billiton, Ltd. (Australia)			1,031	23,124
Ferrovial SA (Spain)			1,478	31,906
Givaudan SA (Switzerland)			16	29,315
LyondellBasell Industries NV Class A			528	53,381
Mitsubishi Chemical Holdings Corp. (Japan)			4,500	28,160
Rio Tinto PLC (United Kingdom)			797	34,790
SBA Communications Corp. Class A(NON)			185	20,685
Sherwin-Williams Co. (The)			123	35,446
South32, Ltd. (Australia)(NON)			901	1,509
Stora Enso OYJ Class R (Finland)			2,829	29,595
Yara International ASA (Norway)			705	35,580
				403,325
Capital goods (1.3%)
ABB, Ltd. (Switzerland)			960	21,001
Allison Transmission Holdings, Inc.			567	17,350
BAE Systems PLC (United Kingdom)			6,159	48,479
Canon, Inc. (Japan)			700	24,163
Crown Holdings, Inc.(NON)			480	26,539
General Dynamics Corp.			330	46,253
Huntington Ingalls Industries, Inc.			101	12,523
IDEX Corp.			119	9,194
Illinois Tool Works, Inc.			104	9,758
Ingersoll-Rand PLC			162	11,142
KBR, Inc.			533	10,207
Leggett & Platt, Inc.			190	8,983
Northrop Grumman Corp.			232	36,930
Raytheon Co.			105	10,842
Roper Technologies, Inc.			168	29,393
Spirit AeroSystems Holdings, Inc. Class A(NON)			153	8,352
Toyoda Gosei Co., Ltd. (Japan)			800	19,811
Vinci SA (France)			661	39,261
				390,181
Communication services (1.1%)
Belgacom SA (Belgium)			985	34,213
Bezeq The Israeli Telecommunication Corp., Ltd. (Israel)			7,782	13,031
CenturyLink, Inc.			816	27,124
Deutsche Telekom AG (Germany)			1,865	32,046
Juniper Networks, Inc.			996	27,689
Nippon Telegraph & Telephone (NTT) Corp. (Japan)			400	27,795
NTT DoCoMo, Inc. (Japan)			900	16,139
Orange SA (France)			2,505	39,508
Sky PLC (United Kingdom)			2,103	33,910
Spark New Zealand, Ltd. (New Zealand)			8,605	16,861
Telstra Corp., Ltd. (Australia)			3,531	16,711
Verizon Communications, Inc.			695	34,361
Vodafone Group PLC (United Kingdom)			3,098	12,091
				331,479
Conglomerates (0.2%)
Bouygues SA (France)			1,009	39,728
Mitsui & Co., Ltd. (Japan)			2,500	35,088
				74,816
Consumer cyclicals (2.7%)
Asahi Glass Co., Ltd. (Japan)			2,000	13,012
Bayerische Motoren Werke (BMW) AG (Germany)			387	42,802
Carter's, Inc.			159	16,412
Dai Nippon Printing Co., Ltd. (Japan)			2,000	21,060
Daihatsu Motor Co., Ltd. (Japan)			1,800	26,306
Daimler AG (Registered Shares) (Germany)			236	22,104
Daito Trust Construction Co., Ltd. (Japan)			200	22,222
Discovery Communications, Inc. Class A(NON)			1,460	49,552
Fuji Heavy Industries, Ltd. (Japan)			1,100	41,416
Harley-Davidson, Inc.			269	14,389
Hilton Worldwide Holdings, Inc.(NON)			887	25,688
Home Depot, Inc. (The)			613	68,300
Host Hotels & Resorts, Inc.(R)			2,102	41,872
Hugo Boss AG (Germany)			206	23,519
KAR Auction Services, Inc.			180	6,707
Kimberly-Clark Corp.			293	31,896
Lear Corp.			118	13,690
Liberty Media Corp. Class A(NON)			176	6,743
Lowe's Cos., Inc.			592	41,428
Macy's, Inc.			290	19,416
Marks & Spencer Group PLC (United Kingdom)			3,990	35,553
Marriott International, Inc./MD Class A			66	5,147
NIKE, Inc. Class B			319	32,433
ProSiebenSat.1 Media AG (Germany)			510	24,388
Ryman Hospitality Properties(R)			1,039	57,259
Scripps Networks Interactive Class A			114	7,639
Sirius XM Holdings, Inc.(NON)			4,215	16,270
SJM Holdings, Ltd. (Hong Kong)			8,000	10,234
Swire Pacific, Ltd. Class A (Hong Kong)			3,500	46,970
VF Corp.			65	4,578
Viacom, Inc. Class B			330	22,070
Wyndham Worldwide Corp.			180	15,284
				826,359
Consumer staples (2.3%)
Altria Group, Inc.			130	6,656
British American Tobacco PLC (United Kingdom)			591	32,568
Bunge, Ltd.			479	44,336
Colgate-Palmolive Co.			128	8,549
CVS Health Corp.			630	64,499
Dr. Pepper Snapple Group, Inc.			408	31,269
Geo Group, Inc. (The)(R)			1,107	41,989
Imperial Tobacco Group PLC (United Kingdom)			772	39,763
ITOCHU Corp. (Japan)			1,900	25,611
Japan Tobacco, Inc. (Japan)			300	10,886
Kao Corp. (Japan)			400	18,135
Kirin Holdings Co., Ltd. (Japan)			1,800	25,816
Koninklijke Ahold NV (Netherlands)			1,672	34,000
Lawson, Inc. (Japan)			300	20,923
Liberty Interactive Corp. Class A(NON)			400	11,188
Liberty Ventures Ser. A(NON)			257	10,666
ManpowerGroup, Inc.			53	4,486
Metcash, Ltd. (Australia)			3,718	3,899
Mondelez International, Inc. Class A			1,429	59,432
Nestle SA (Switzerland)			618	47,936
Philip Morris International, Inc.			229	19,023
Reckitt Benckiser Group PLC (United Kingdom)			195	17,599
Rite Aid Corp.(NON)			4,249	37,051
Swedish Match AB (Sweden)			759	22,601
Unilever NV ADR (Netherlands)			1,033	44,054
Unilever PLC (United Kingdom)			365	16,106
Woolworths, Ltd. (Australia)			518	11,049
				710,090
Energy (1.4%)
BP PLC (United Kingdom)			4,867	33,530
CVR Energy, Inc.			77	2,985
Exxon Mobil Corp.			337	28,712
Halcon Resources Corp.(NON)			286	300
Marathon Petroleum Corp.			360	37,246
Occidental Petroleum Corp.			734	57,391
Oil States International, Inc.(NON)			77	3,148
Royal Dutch Shell PLC Class A (United Kingdom)			1,343	39,883
Royal Dutch Shell PLC Class B (United Kingdom)			697	21,024
Schlumberger, Ltd.			591	53,645
Statoil ASA (Norway)			563	10,563
Superior Energy Services, Inc.			656	15,147
TonenGeneral Sekiyu KK (Japan)			2,000	18,890
Total SA (France)			735	37,113
Valero Energy Corp.			882	52,250
Woodside Petroleum, Ltd. (Australia)			859	23,918
				435,745
Financial (0.7%)
Deutsche Boerse AG (Germany)			387	30,998
Goldman Sachs Group, Inc. (The)			236	48,661
HSBC Holdings PLC (United Kingdom)			6,279	59,759
Morgan Stanley			701	26,778
Natixis SA (France)			5,751	43,115
				209,311
Health care (2.6%)
AbbVie, Inc.			306	20,377
Aetna, Inc.			131	15,454
AmerisourceBergen Corp.			451	50,765
Anthem, Inc.			260	43,641
AstraZeneca PLC (United Kingdom)			812	54,265
C.R. Bard, Inc.			108	18,395
Cardinal Health, Inc.			294	25,922
Celgene Corp.(NON)			306	35,019
Edwards Lifesciences Corp.(NON)			148	19,347
Eisai Co., Ltd. (Japan)			700	43,776
Gilead Sciences, Inc.(NON)			478	53,665
GlaxoSmithKline PLC (United Kingdom)			1,177	26,147
Health Net, Inc.(NON)			73	4,544
Indivior PLC (United Kingdom)(NON)			171	601
Johnson & Johnson			230	23,032
Merck & Co., Inc.			1,122	68,319
Novartis AG (Switzerland)			468	48,052
Pfizer, Inc.			2,321	80,655
Roche Holding AG-Genusschein (Switzerland)			131	38,498
Sanofi (France)			368	36,032
Takeda Pharmaceutical Co., Ltd. (Japan)			1,000	48,469
Ventas, Inc.(R)			1,016	67,584
				822,559
Insurance (1.1%)
Allianz SE (Germany)			57	8,937
American International Group, Inc.			32	1,876
AMP, Ltd. (Australia)			6,072	30,675
Aon PLC			32	3,239
Aspen Insurance Holdings, Ltd.			55	2,550
Aviva PLC (United Kingdom)			4,407	35,261
Axis Capital Holdings, Ltd.			112	6,164
Baloise Holding AG (Switzerland)			153	19,063
CNP Assurances (France)			2,017	33,351
Everest Re Group, Ltd.			9	1,634
Genworth Financial, Inc. Class A(NON)			2,412	19,151
Insurance Australia Group, Ltd. (Australia)			5,666	24,429
Legal & General Group PLC (United Kingdom)			7,798	31,679
Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Germany)			59	10,886
Prudential Financial, Inc.			488	41,290
Reinsurance Group of America, Inc. Class A			25	2,339
Tryg A/S (Denmark)			846	16,901
Zurich Insurance Group AG (Switzerland)			123	39,249
				328,674
Investment banking/Brokerage (0.1%)
Daiwa Securities Group, Inc. (Japan)			2,000	15,793
NorthStar Asset Management Group, Inc.			224	4,901
Partners Group Holding AG (Switzerland)			58	18,190
				38,884
Real estate (8.9%)
Alexandria Real Estate Equities, Inc.(R)			796	73,813
American Capital Agency Corp.(R)			502	10,472
American Realty Capital Properties, Inc.(R)			1,574	13,961
Apartment Investment & Management Co. Class A(R)			1,394	52,874
AvalonBay Communities, Inc.(R)			774	128,871
Boston Properties, Inc.(R)			972	126,389
Brixmor Property Group, Inc.(R)			2,560	63,437
Camden Property Trust(R)			850	63,733
CBRE Group, Inc. Class A(NON)			993	37,972
Chimera Investment Corp.(R)			112	1,616
Corporate Office Properties Trust(R)			1,879	48,234
DDR Corp.(R)			239	4,044
DiamondRock Hospitality Co.(R)			3,851	50,718
Digital Realty Trust, Inc.(R)			208	13,736
Duke Realty Corp.(R)			3,004	58,758
DuPont Fabros Technology, Inc.(R)			2,344	75,571
Equity Lifestyle Properties, Inc.(R)			42	2,301
Equity Residential Trust(R)			1,926	143,140
Essex Property Trust, Inc.(R)			162	36,064
Extra Space Storage, Inc.(R)			100	7,003
Federal Realty Investment Trust(R)			125	16,809
General Growth Properties(R)			4,979	141,055
HCP, Inc.(R)			1,705	66,018
Health Care REIT, Inc.(R)			1,233	86,631
Healthcare Realty Trust, Inc.(R)			1,726	41,113
Highwoods Properties, Inc.(R)			1,357	56,926
Jones Lang LaSalle, Inc.			87	15,071
Kimco Realty Corp.(R)			3,356	80,410
Klepierre (France)(R)			392	17,415
Liberty Property Trust(R)			1,468	51,292
Macerich Co. (The)(R)			326	26,768
Medical Properties Trust, Inc.(R)			4,561	61,847
MFA Financial, Inc.(R)			529	4,200
Mid-America Apartment Communities, Inc.(R)			56	4,278
National Health Investors, Inc.(R)			675	44,645
Outfront Media, Inc.(R)			58	1,607
Persimmon PLC (United Kingdom)			1,226	36,764
Post Properties, Inc.(R)			759	43,119
Prologis, Inc.(R)			3,042	120,433
Public Storage(R)			777	150,381
Realty Income Corp.(R)			539	24,562
Regency Centers Corp.(R)			59	3,725
Simon Property Group, Inc.(R)			1,576	285,886
SL Green Realty Corp.(R)			233	27,648
Spirit Realty Capital, Inc.(R)			1,548	16,703
Stockland (Units) (Australia)(R)			8,026	26,487
Sunstone Hotel Investors, Inc.(R)			3,603	54,982
Taubman Centers, Inc.(R)			793	58,706
Two Harbors Investment Corp.(R)			1,116	11,930
UDR, Inc.(R)			375	12,210
Vornado Realty Trust(R)			510	50,944
Washington Real Estate Investment Trust(R)			1,325	33,191
Weingarten Realty Investors(R)			1,650	55,655
WP Carey, Inc.(R)			78	4,968
				2,747,086
Technology (2.4%)
Agilent Technologies, Inc.			453	18,659
Amdocs, Ltd.			263	14,426
Apple, Inc.			1,232	160,505
Avago Technologies, Ltd.			165	24,432
Computer Sciences Corp.			377	25,862
Dun & Bradstreet Corp. (The)			43	5,501
eBay, Inc.(NON)			977	59,949
EMC Corp.			1,171	30,844
Google, Inc. Class A(NON)			119	64,893
Hoya Corp. (Japan)			1,000	36,755
Intuit, Inc.			254	26,435
Iron Mountain, Inc.(R)			1,709	62,327
L-3 Communications Holdings, Inc.			233	27,450
Leidos Holdings, Inc.			295	12,538
Marvell Technology Group, Ltd.			927	12,969
Maxim Integrated Products, Inc.			336	11,784
Microsoft Corp.			196	9,185
Nippon Electric Glass Co., Ltd. (Japan)			4,000	21,181
Oracle Corp.			1,468	63,843
Symantec Corp.			886	21,818
Teradyne, Inc.			533	11,273
Xerox Corp.			1,664	19,003
				741,632
Transportation (0.6%)
ComfortDelgro Corp., Ltd. (Singapore)			11,400	25,858
Delta Air Lines, Inc.			53	2,275
Deutsche Post AG (Germany)			672	20,256
Japan Airlines Co., Ltd. (Japan)			800	27,455
Southwest Airlines Co.			967	35,827
Teekay Corp. (Bermuda)			112	5,132
United Parcel Service, Inc. Class B			485	48,122
Yangzijiang Shipbuilding Holdings, Ltd. (China)			18,300	19,593
				184,518
Utilities and power (0.8%)
AES Corp.			455	6,188
Alliant Energy Corp.			32	1,962
American Electric Power Co., Inc.			603	33,943
Electricite De France SA (France)			830	20,401
Energias de Portugal (EDP) SA (Portugal)			8,068	31,501
ENI SpA (Italy)			1,324	23,834
Entergy Corp.			556	42,517
OGE Energy Corp.			52	1,638
Red Electrica Corporacion SA (Spain)			433	36,419
Snam SpA (Italy)			6,599	32,644
UGI Corp.			621	23,225
				254,272
Total common stocks (cost $8,280,065)				$8,996,622
INVESTMENT COMPANIES (10.7%)(a)
			Shares	Value
iShares MSCI EAFE ETF			186	$12,395
Putnam Absolute Return 700 Fund Class Y(AFF)			250,435	3,160,489
SPDR S&P 500 ETF Trust(S)			201	42,437
SPDR S&P MidCap 400 ETF Trust			21	5,830
Vanguard REIT ETF			920	72,809
Total investment companies (cost $3,276,105)				$3,293,960
CONVERTIBLE BONDS AND NOTES (8.1%)(a)
			Principal amount	Value
Basic materials (0.2%)
AK Steel Corp. cv. company guaranty sr. unsec. unsub. notes 5s, 2019			$31,000	$37,975
Cemex SAB de CV cv. unsec. sub. notes 3 3/4s, 2018 (Mexico)			16,000	19,340
				57,315
Capital goods (0.3%)
General Cable Corp. cv. unsec. sub. notes stepped-coupon 4 1/2s (2 1/4s, 11/15/19) 2029(STP)			19,000	15,331
Trinity Industries, Inc. cv. unsec. sub. notes 3 7/8s, 2036			31,000	42,741
WESCO International, Inc. cv. company guaranty sr. unsec. notes 6s, 2029			8,000	20,280
				78,352
Communication services (0.1%)
Clearwire Communications, LLC/Clearwire Finance, Inc. 144A cv. company guaranty sr. unsec. notes 8 1/4s, 2040			6,000	6,540
Powerwave Technologies, Inc. cv. unsec. sub. notes 3 7/8s, 2027 (In default)(F)(NON)			38,000	4
TeleCommunication Systems, Inc. cv. sr. unsec. notes 7 3/4s, 2018			34,000	33,320
				39,864
Consumer cyclicals (1.8%)
Callaway Golf Co. cv. sr. unsec. bonds 3 3/4s, 2019			14,000	17,903
Carriage Services, Inc. cv. unsec. sub. bonds 2 3/4s, 2021			19,000	23,418
CBIZ, Inc. 144A cv. sr. sub. notes 4 7/8s, 2015			12,000	14,933
Host Hotels & Resorts LP 144A cv. company guaranty sr. unsec. notes 2 1/2s, 2029(R)			16,000	24,880
Jarden Corp. company guaranty cv. sr. unsec. bonds 1 1/8s, 2034			44,000	52,113
Lennar Corp. 144A cv. sr. notes 2 3/4s, 2020			18,000	37,845
Liberty Interactive, LLC cv. sr. unsec. unsub. bonds 0 3/4s, 2043			28,000	44,783
Liberty Interactive, LLC cv. sr. unsec. unsub. notes 3 1/2s, 2031			50,000	26,438
Liberty Interactive, LLC 144A cv. sr. unsec. notes 1s, 2043			18,000	17,404
M/I Homes, Inc. cv. company guaranty sr. sub. notes 3s, 2018			13,000	12,878
Macquarie Infrastructure Corp. cv. sr. unsec. sub. notes 2 7/8s, 2019			26,000	31,021
Navistar International Corp. cv. sr. unsec. sub. bonds 4 3/4s, 2019			32,000	28,880
Priceline Group, Inc. (The) cv. sr. unsec. unsub. notes 1s, 2018			15,000	20,194
Ryland Group, Inc. (The) cv. company guaranty sr. unsec. unsub. notes 1 5/8s, 2018			27,000	38,323
Standard Pacific Corp. cv. company guaranty sr. unsec. unsub. notes 1 1/4s, 2032			20,000	23,488
Tesla Motors, Inc. cv. sr. unsec. notes 1 1/4s, 2021			99,000	94,854
TiVo, Inc. 144A cv. sr. unsec. notes 2s, 2021			30,000	27,769
				537,124
Consumer staples (0.1%)
Vector Group, Ltd. cv. sr. unsec. FRN 2 1/2s, 2019			30,000	42,148
				42,148
Energy (0.8%)
Chesapeake Energy Corp. cv. company guaranty sr. unsec. notes 2 1/4s, 2038			124,000	114,080
Cobalt International Energy, Inc. cv. sr. unsec. unsub. notes 2 5/8s, 2019			49,000	38,067
Energy XXI, Ltd. cv. sr. unsec. bonds 3s, 2018 (acquired various dates from 11/19/13 to 1/24/14, cost $13,899)(RES)			14,000	5,390
Goodrich Petroleum Corp. cv. company guaranty sr. unsec. unsub. notes 5s, 2032			18,000	10,260
Hornbeck Offshore Services, Inc. cv. company guaranty sr. unsec. notes 1 1/2s, 2019			13,000	10,977
Peabody Energy Corp. cv. jr. unsec. sub. debs. 4 3/4s, 2041			21,000	5,263
SEACOR Holdings, Inc. cv. sr. unsec. bonds 3s, 2028			31,000	27,900
SunEdison, Inc. 144A cv. sr. unsec. notes 2 5/8s, 2023			17,000	17,542
Trico Marine Services, Inc. cv. sr. unsec. debs. 3s, 2027 (In default)(NON)			15,000	413
Vantage Drilling Co. cv. sr. unsec. unsub. notes 7 7/8s, 2042			27,000	24,941
				254,833
Financials (1.1%)
Ares Capital Corp. cv. sr. unsec. notes 5 3/4s, 2016			25,000	25,688
Ares Capital Corp. cv. sr. unsec. unsub. bonds 4 3/8s, 2019			8,000	8,295
Blackstone Mortgage Trust, Inc. cv. sr. unsec. unsub. notes 5 1/4s, 2018(R)			24,000	25,980
Cowen Group, Inc. cv. sr. unsec. unsub. notes 3s, 2019			17,000	20,687
Empire State Realty OP LP 144A cv. sr. unsec. notes 2 5/8s, 2019(R)			18,000	18,799
Fidelity National Financial, Inc. cv. sr. unsec. unsub. notes 4 1/4s, 2018			13,000	26,943
Forest City Enterprises, Inc. cv. sr. unsec. notes 4 1/4s, 2018			38,000	45,481
Hercules Technology Growth Capital, Inc. cv. sr. unsec. notes 6s, 2016			16,000	18,200
iStar Financial, Inc. cv. sr. unsec. unsub. notes 3s, 2016(R)			10,000	12,656
Radian Group, Inc. cv. sr. unsec. unsub. notes 3s, 2017			27,000	43,419
Spirit Realty Capital, Inc. cv. sr. unsec. notes 2 7/8s, 2019(R)			19,000	18,466
Starwood Property Trust, Inc. cv. sr. unsec. unsub. notes 4s, 2019(R)			30,000	33,919
TCP Capital Corp. 144A cv. sr. unsec. notes 5 1/4s, 2019			41,000	41,333
Walter Investment Management Corp. cv. sr. unsec. sub. notes 4 1/2s, 2019			10,000	7,800
				347,666
Health care (1.3%)
Accuray, Inc. cv. sr. unsec. notes 3 3/4s, 2016			32,000	32,380
AMAG Pharmaceuticals, Inc. cv. sr. unsec. unsub. notes 2 1/2s, 2019			12,000	31,170
Brookdale Senior Living, Inc. cv. sr. unsec. unsub. notes 2 3/4s, 2018			36,000	50,220
China Medical Technologies, Inc. cv. sr. unsec. bonds Ser. CMT, 4s, 2016 (China) (In default)(F)(NON)			25,000	2,000
China Medical Technologies, Inc. 144A cv. sr. unsec. notes 6 1/4s, 2016 (China) (In default)(F)(NON)			14,000	980
Gilead Sciences, Inc. cv. sr. unsec. notes 1 5/8s, 2016			15,000	74,081
HealthSouth Corp. cv. sr. unsec. sub. notes 2s, 2043			36,000	43,650
Hologic, Inc. cv. sr. unsec. unsub. notes stepped-coupon 2s (0s, 3/1/18) 2042(STP)			44,000	56,320
Jazz Investments I, Ltd. 144A cv. company guaranty sr. unsec. notes 1 7/8s, 2021 (Ireland)			41,000	48,867
Medidata Solutions, Inc. cv. sr. unsec. notes 1s, 2018			20,000	24,538
Teleflex, Inc. cv. sr. unsec. sub. notes 3 7/8s, 2017			13,000	27,186
				391,392
Technology (2.2%)
Ciena Corp. cv. sr. unsec. notes 4s, 2020			29,000	40,981
Intel Corp. cv. jr. sub. notes 3 1/4s, 2039			17,000	28,879
j2 Global, Inc. cv. sr. unsec. notes 3 1/4s, 2029			30,000	34,800
Jazz Technologies, Inc. company guaranty cv. sr. unsec. bonds 8s, 2018			8,000	13,220
Micron Technology, Inc. cv. sr. unsec. bonds Ser. E, 1 5/8s, 2033			64,000	164,280
Micron Technology, Inc. cv. sr. unsec. unsub. bonds 3s, 2043			50,000	56,250
Novellus Systems, Inc. cv. company guaranty sr. unsec. notes 2 5/8s, 2041			16,000	38,410
NVIDIA Corp. cv. sr. unsec. bonds 1s, 2018			49,000	59,566
ON Semiconductor Corp. cv. company guaranty sr. unsec. sub. notes Ser. B, 2 5/8s, 2026			20,000	27,038
Safeguard Scientifics, Inc. cv. sr. unsec. bonds 5 1/4s, 2018			34,000	40,800
Salesforce.com, Inc. cv. sr. unsec. unsub. notes 0 1/4s, 2018			33,000	41,271
SanDisk Corp. cv. sr. unsec. notes 1 1/2s, 2017			22,000	31,818
Verint Systems, Inc. cv. sr. unsec. notes 1 1/2s, 2021			22,000	26,166
Vishay Intertechnology, Inc. 144A cv. sr. unsec. notes 2 1/4s, 2041			18,000	14,760
Yahoo!, Inc. cv. sr. unsec. bonds zero %, 2018			61,000	65,804
				684,043
Transportation (0.2%)
Atlas Air Worldwide Holdings, Inc. cv. sr. unsec. notes 2 1/4s, 2022			23,000	23,230
Scorpio Tankers, Inc. 144A cv. sr. unsec. notes 2 3/8s, 2019			48,000	50,430
				73,660
Total convertible bonds and notes (cost $2,401,178)				$2,506,397
CORPORATE BONDS AND NOTES (6.2%)(a)
			Principal amount	Value
Basic materials (0.4%)
Agrium, Inc. sr. unsec. notes 3 3/8s, 2025 (Canada)			$5,000	$4,889
Agrium, Inc. sr. unsec. unsub. 5 1/4s, 2045 (Canada)			2,000	2,109
ArcelorMittal SA sr. unsec. bonds 10.6s, 2019 (France)			15,000	18,225
Celanese US Holdings, LLC sr. notes 5 7/8s, 2021 (Germany)			5,000	5,425
CF Industries, Inc. company guaranty sr. unsec. notes 5 3/8s, 2044			4,000	4,148
CF Industries, Inc. company guaranty sr. unsec. notes 5.15s, 2034			3,000	3,149
Eastman Chemical Co. sr. unsec. unsub. notes 3.8s, 2025			2,000	2,048
Glencore Funding, LLC 144A company guaranty sr. unsec. unsub. notes 4 5/8s, 2024			3,000	3,084
Glencore Funding, LLC 144A company guaranty sr. unsec. unsub. notes 4s, 2025			10,000	9,642
Glencore Funding, LLC 144A company guaranty sr. unsec. unsub. notes 2 7/8s, 2020			2,000	1,990
Huntsman International, LLC company guaranty sr. unsec. unsub. notes 4 7/8s, 2020			30,000	30,450
LyondellBasell Industries NV sr. unsec. unsub. notes 4 5/8s, 2055			5,000	4,564
NOVA Chemicals Corp. 144A sr. unsec. notes 5s, 2025 (Canada)			2,000	2,050
Rockwood Specialties Group, Inc. company guaranty sr. unsec. notes 4 5/8s, 2020			9,000	9,394
Westvaco Corp. company guaranty sr. unsec. unsub. notes 8.2s, 2030			5,000	6,902
Westvaco Corp. company guaranty sr. unsec. unsub. notes 7.95s, 2031			5,000	6,490
				114,559
Capital goods (0.1%)
Delphi Corp. company guaranty sr. unsec. unsub. notes 5s, 2023			5,000	5,384
Legrand France SA sr. unsec. unsub. debs 8 1/2s, 2025 (France)			10,000	13,896
				19,280
Communication services (1.4%)
American Tower Corp. sr. unsec. notes 4s, 2025(R)			10,000	9,941
AT&T, Inc. sr. unsec. notes 4 3/4s, 2046			2,000	1,905
AT&T, Inc. sr. unsec. unsub. notes 3.4s, 2025			3,000	2,918
CCO Holdings, LLC/CCO Holdings Capital Corp. company guaranty sr. unsec. notes 5 1/4s, 2022			35,000	35,744
CCO Holdings, LLC/CCO Holdings Capital Corp. company guaranty sr. unsec. unsub. bonds 5 1/8s, 2023			30,000	30,150
Comcast Cable Communications Holdings, Inc. company guaranty sr. unsec. notes 9.455s, 2022			5,000	7,136
Comcast Corp. company guaranty sr. unsec. unsub. notes 6.95s, 2037			5,000	6,660
Crown Castle International Corp. sr. unsec. notes 5 1/4s, 2023(R)			25,000	26,356
Crown Castle Towers, LLC 144A company guaranty sr. notes 4.883s, 2020			5,000	5,466
CSC Holdings, LLC sr. unsec. unsub. notes 6 3/4s, 2021			35,000	38,063
DISH DBS Corp. company guaranty sr. unsec. unsub. notes 5 7/8s, 2024			10,000	10,025
Intelsat Luxembourg SA company guaranty sr. unsec. bonds 7 3/4s, 2021 (Luxembourg)			35,000	31,588
Koninklijke KPN NV sr. unsec. unsub. bonds 8 3/8s, 2030 (Netherlands)			5,000	7,089
Level 3 Financing, Inc. company guaranty sr. unsec. unsub. notes 6 1/8s, 2021			25,000	26,500
Qwest Corp. sr. unsec. notes 6 3/4s, 2021			2,000	2,250
SBA Tower Trust 144A company guaranty sr. notes 5.101s, 2017			10,000	10,510
Sprint Capital Corp. company guaranty 6 7/8s, 2028			40,000	36,100
Sprint Corp. company guaranty sr. unsec. notes 7 1/4s, 2021			70,000	70,438
T-Mobile USA, Inc. company guaranty sr. unsec. unsub. notes 6 1/8s, 2022			40,000	41,800
Telefonica Emisiones SAU company guaranty sr. unsec. notes 5.462s, 2021 (Spain)			5,000	5,660
Verizon Communications, Inc. sr. unsec. unsub. notes 5.9s, 2054			200	5,236
Verizon Communications, Inc. sr. unsec. unsub. notes 4.4s, 2034			5,000	4,812
Verizon Communications, Inc. 144A sr. unsec. unsub. notes 4.522s, 2048			19,000	17,357
				433,704
Consumer cyclicals (0.9%)
21st Century Fox America, Inc. company guaranty sr. unsec. unsub. notes 7 3/4s, 2045			5,000	7,090
Autonation, Inc. company guaranty sr. unsec. unsub. notes 5 1/2s, 2020			5,000	5,494
Bed Bath & Beyond, Inc. sr. unsec. notes 5.165s, 2044			5,000	5,151
Bon-Ton Department Stores, Inc. (The) company guaranty notes 10 5/8s, 2017			4,000	3,985
CBS Corp. company guaranty sr. unsec. debs. 7 7/8s, 2030			5,000	6,712
Ford Motor Co. sr. unsec. unsub. notes 7.45s, 2031			5,000	6,514
Ford Motor Co. sr. unsec. unsub. notes 7.4s, 2046			5,000	7,015
Gannett Co., Inc. 144A company guaranty sr. unsec. notes 4 7/8s, 2021			2,000	2,015
General Motors Co. sr. unsec. unsub. notes 6 1/4s, 2043			5,000	5,785
General Motors Financial Co., Inc. company guaranty sr. unsec. unsub. Notes 3.45s, 2022			10,000	9,848
Host Hotels & Resorts LP sr. unsec. unsub. notes 5 1/4s, 2022(R)			5,000	5,512
iHeartCommunications, Inc. company guaranty sr. notes 9s, 2021			55,000	51,975
INVISTA Finance, LLC 144A company guaranty sr. notes 4 1/4s, 2019			3,000	2,955
Macy's Retail Holdings, Inc. company guaranty sr. unsec. notes 6.9s, 2029			4,000	5,084
Macy's Retail Holdings, Inc. company guaranty sr. unsec. notes 6.65s, 2024			1,000	1,241
Macy's Retail Holdings, Inc. company guaranty sr. unsec. notes 3 5/8s, 2024			3,000	3,074
Macy's Retail Holdings, Inc. company guaranty sr. unsec. unsub. notes 7s, 2028			3,000	3,816
MGM Resorts International company guaranty sr. unsec. notes 5 1/4s, 2020			45,000	46,350
Neiman Marcus Group, Ltd. 144A company guaranty sr. unsec. notes 8 3/4s, 2021(PIK)			35,000	37,800
Nordstrom, Inc. sr. unsec. notes 5s, 2044			2,000	2,235
Nordstrom, Inc. sr. unsec. unsub. notes 6.95s, 2028			5,000	6,532
Owens Corning company guaranty sr. unsec. notes 9s, 2019			5,000	6,016
Priceline Group, Inc. (The) sr. unsec. unsub. notes 3.65s, 2025			4,000	4,019
QVC, Inc. company guaranty sr. notes 4.85s, 2024			2,000	2,063
QVC, Inc. company guaranty sr. unsub. notes 4.45s, 2025			2,000	1,985
Sirius XM Radio, Inc. 144A sr. unsec. bonds 5 7/8s, 2020			15,000	15,619
Tiffany & Co. sr. unsec. unsub. notes 4.9s, 2044			5,000	4,941
Time Warner, Inc. company guaranty sr. unsec. bonds 7.7s, 2032			5,000	6,800
Vulcan Materials Co. sr. unsec. unsub. notes 4 1/2s, 2025			2,000	2,023
				269,649
Consumer staples (0.3%)
Altria Group, Inc. company guaranty sr. unsec. notes 9 1/4s, 2019			2,000	2,543
Altria Group, Inc. company guaranty sr. unsec. unsub. notes 2.85s, 2022			5,000	4,902
Anheuser-Busch InBev Worldwide, Inc. company guaranty sr. unsec. unsub. notes 8.2s, 2039			10,000	15,295
ConAgra Foods, Inc. sr. unsec. notes 7s, 2019			5,000	5,788
Constellation Brands, Inc. company guaranty sr. unsec. unsub. notes 7 1/4s, 2016			5,000	5,345
Constellation Brands, Inc. company guaranty sr. unsec. unsub. notes 6s, 2022			10,000	11,275
Constellation Brands, Inc. company guaranty sr. unsec. unsub. notes 3 7/8s, 2019			2,000	2,048
Corrections Corp. of America company guaranty sr. unsec. notes 4 5/8s, 2023(R)			2,000	1,995
CVS Pass-Through Trust sr. notes 6.036s, 2028			3,795	4,392
ERAC USA Finance, LLC 144A company guaranty sr. unsec. bonds 4 1/2s, 2045			5,000	4,820
ERAC USA Finance, LLC 144A company guaranty sr. unsec. notes 7s, 2037			10,000	12,807
Kraft Foods Group, Inc. sr. unsec. notes Ser. 144A, 6 7/8s, 2039			5,000	6,218
Kroger Co. (The) company guaranty sr. unsec. notes 6.9s, 2038			2,000	2,614
McDonald's Corp. sr. unsec. notes 5.7s, 2039			15,000	17,582
Tyson Foods, Inc. company guaranty sr. unsec. bonds 4 7/8s, 2034			2,000	2,113
Tyson Foods, Inc. company guaranty sr. unsec. unsub. bonds 5.15s, 2044			3,000	3,263
Walgreens Boots Alliance, Inc. company guaranty sr. unsec. unsub. notes 3.3s, 2021			5,000	5,050
				108,050
Energy (0.3%)
BP Capital Markets PLC company guaranty sr. unsec. unsub. notes 4 1/2s, 2020 (United Kingdom)			5,000	5,535
California Resources Corp. company guaranty sr. unsec. notes 5s, 2020			2,000	1,905
DCP Midstream Operating LP company guaranty sr. unsec. notes 2.7s, 2019			5,000	4,746
EQT Midstream Partners LP company guaranty sr. unsec. notes 4s, 2024			2,000	1,941
Freeport-McMoran Oil & Gas, LLC/FCX Oil & Gas, Inc. company guaranty sr. unsec. notes 6 3/4s, 2022			3,000	3,195
Freeport-McMoran Oil & Gas, LLC/FCX Oil & Gas, Inc. company guaranty sr. unsec. unsub. notes 6 7/8s, 2023			2,000	2,148
Kerr-McGee Corp. company guaranty sr. unsec. unsub. notes 7 7/8s, 2031			5,000	6,731
Petrobras Global Finance BV company guaranty sr. unsec. notes 3 7/8s, 2016 (Brazil)			5,000	5,020
Rosetta Resources, Inc. company guaranty sr. unsec. unsub. notes 5 5/8s, 2021			5,000	5,301
Shelf Drilling Holdings, Ltd. 144A sr. notes 8 5/8s, 2018			15,000	13,350
Spectra Energy Capital, LLC company guaranty sr. unsec. unsub. notes 6.2s, 2018			5,000	5,551
Weatherford International, Ltd./Bermuda company guaranty sr. unsec. notes 9 7/8s, 2039 (Bermuda)			10,000	11,957
Williams Cos., Inc. (The) notes 8 3/4s, 2032			7,000	8,995
Williams Cos., Inc. (The) notes 7 3/4s, 2031			2,000	2,381
Williams Cos., Inc. (The) sr. unsec. notes 4.55s, 2024			5,000	5,116
				83,872
Financials (1.2%)
Ally Financial, Inc. company guaranty sr. unsec. unsub. notes 7 1/2s, 2020			40,000	46,900
American Express Co. jr. unsec. sub. FRN Ser. C, 4.9s, perpetual maturity			5,000	4,912
American International Group, Inc. jr. sub. FRB 8.175s, 2058			5,000	6,806
ARC Properties Operating Partnership LP/Clark Acquisition, LLC company guaranty sr. unsec. unsub. notes 4.6s, 2024(R)			3,000	2,970
Bank of America Corp. jr. unsec. sub. FRN Ser. AA, 6.1s, perpetual maturity			14,000	14,158
Bank of America Corp. jr. unsec. sub. FRN Ser. Z, 6 1/2s, perpetual maturity			10,000	10,575
Bear Stearns Cos., LLC (The) sr. unsec. unsub. notes 7 1/4s, 2018			15,000	17,135
Camden Property Trust sr. unsec. notes 4 7/8s, 2023(R)			5,000	5,511
CBL & Associates LP company guaranty sr. unsec. unsub. notes 5 1/4s, 2023(R)			5,000	5,238
CIT Group, Inc. sr. unsec. notes 5s, 2022			55,000	56,513
Citigroup, Inc. jr. unsec. sub. FRB Ser. B, 5.9s, perpetual maturity			2,000	1,998
Citigroup, Inc. jr. unsec. sub. FRB Ser. P, 5.95s, perpetual maturity			4,000	3,945
Citigroup, Inc. sr. unsec. notes 8 1/2s, 2019			2,000	2,467
DDR Corp. sr. unsec. unsub. notes 7 7/8s, 2020(R)			5,000	6,183
Duke Realty LP sr. unsec. unsub. notes 3 7/8s, 2021(R)			5,000	5,243
Fairfax US, Inc. 144A company guaranty sr. unsec. notes 4 7/8s, 2024			2,000	1,965
General Electric Capital Corp. sr. unsec. notes 6 3/4s, 2032			5,000	6,738
Genworth Holdings, Inc. company guaranty jr. unsec. sub. FRB 6.15s, 2066			3,000	1,883
Hartford Financial Services Group, Inc. (The) jr. unsec. sub. FRB 8 1/8s, 2038			5,000	5,638
Healthcare Realty Trust, Inc. sr. unsec. unsub. notes 3 7/8s, 2025(R)			5,000	4,936
HSBC Capital Funding LP 144A company guaranty jr. unsec. sub. FRB 10.176s, perpetual maturity (Jersey)			8,000	12,200
International Lease Finance Corp. sr. unsec. notes 6 1/4s, 2019			5,000	5,538
Liberty Mutual Group, Inc. 144A company guaranty jr. unsec. sub. bonds 7.8s, 2037			2,000	2,425
Liberty Mutual Group, Inc. 144A company guaranty jr. unsec. sub. FRN 7s, 2037			5,000	5,144
Liberty Property LP sr. unsec. unsub. notes 3 3/8s, 2023(R)			5,000	4,910
Lloyds Banking Group PLC 144A jr. unsec. sub. FRN 6.657s, perpetual maturity (United Kingdom)			10,000	11,400
Massachusetts Mutual Life Insurance Co. 144A notes 8 7/8s, 2039			5,000	7,713
MPT Operating Partnership LP/MPT Finance Corp. company guaranty sr. unsec. notes 6 7/8s, 2021(R)			5,000	5,356
Neuberger Berman Group, LLC/Neuberger Berman Finance Corp. 144A sr. unsec. notes 5 7/8s, 2022			2,000	2,150
PHH Corp. sr. unsec. unsub. notes 6 3/8s, 2021			15,000	15,038
Progressive Corp. (The) jr. unsec. sub. FRN 6.7s, 2037			2,000	2,090
Royal Bank of Scotland PLC (The) unsec. sub. FRN Ser. REGS, 9 1/2s, 2022 (United Kingdom)			5,000	5,600
Select Income REIT sr. unsec. unsub. notes 3.6s, 2020(R)			5,000	5,143
Select Income REIT sr. unsec. unsub. notes 2.85s, 2018(R)			5,000	5,070
Springleaf Finance Corp. sr. unsec. unsub. notes 6s, 2020			30,000	30,825
State Street Capital Trust IV company guaranty jr. unsec. sub. FRB 1.271s, 2037			15,000	12,825
Teachers Insurance & Annuity Association of America 144A unsec. sub. FRN 4 3/8s, 2054			2,000	2,142
USI, Inc./NY 144A sr. unsec. notes 7 3/4s, 2021			10,000	10,200
Wells Fargo & Co. jr. unsec. sub. FRB Ser. U, 5 7/8s, perpetual maturity			10,000	10,513
Willis Group Holdings PLC company guaranty sr. unsec. unsub. notes 5 3/4s, 2021			10,000	11,202
WP Carey, Inc. sr. unsec. unsub. notes 4.6s, 2024(R)			5,000	5,144
				384,342
Health care (0.5%)
AbbVie, Inc. sr. unsec. notes 3.6s, 2025			2,000	2,013
Actavis Funding SCS company guaranty sr. unsec. unsub. notes 4 3/4s, 2045 (Luxembourg)			3,000	2,971
Fresenius Medical Care US Finance II, Inc. 144A company guaranty sr. unsec. notes 5 5/8s, 2019			2,000	2,175
HCA, Inc. company guaranty sr. notes 5s, 2024			5,000	5,213
HCA, Inc. company guaranty sr. notes 3 3/4s, 2019			45,000	45,675
Medtronic PLC 144A sr. unsec. notes 4 3/8s, 2035			3,000	3,075
Medtronic PLC 144A sr. unsec. notes 3 1/2s, 2025			2,000	2,048
Omega Healthcare Investors, Inc. company guaranty sr. unsec. notes 4.95s, 2024(R)			2,000	2,089
Omega Healthcare Investors, Inc. 144A company guaranty sr. unsec. notes 4 1/2s, 2027(R)			5,000	4,863
Omnicare, Inc. sr. unsec. notes 4 3/4s, 2022			12,000	13,050
Par Pharmaceutical Cos., Inc. company guaranty sr. unsec. unsub. notes 7 3/8s, 2020			30,000	32,100
Service Corporation International sr. unsec. unsub. notes 6 3/4s, 2016			25,000	26,000
Service Corporation International sr. unsec. unsub. notes 5 3/8s, 2024			20,000	21,200
				162,472
Technology (0.3%)
Apple, Inc. sr. unsec. unsub. notes 4 3/8s, 2045			3,000	3,039
First Data Corp. 144A company guaranty notes 8 1/4s, 2021			80,000	85,300
Freescale Semiconductor, Inc. company guaranty sr. unsec. notes 10 3/4s, 2020			2,000	2,138
Oracle Corp. sr. unsec. unsub. notes 4 1/8s, 2045			2,000	1,936
				92,413
Utilities and power (0.8%)
AES Corp./Virginia (The) sr. unsec. notes 8s, 2020			15,000	17,550
CMS Energy Corp. sr. unsec. notes 8 3/4s, 2019			5,000	6,218
Colorado Interstate Gas Co., LLC sr. unsec. debs. 6.85s, 2037			100,000	110,326
El Paso Natural Gas Co., LLC sr. unsec. unsub. bonds 8 3/8s, 2032			5,000	6,172
Electricite de France (EDF) 144A sr. unsec. notes 6.95s, 2039 (France)			5,000	6,712
EP Energy, LLC/Everest Acquisition Finance, Inc. company guaranty sr. unsec. unsub. notes 7 3/4s, 2022			25,000	26,250
FirstEnergy Corp. sr. unsec. unsub. notes 4 1/4s, 2023			6,000	6,179
Iberdrola International BV company guaranty sr. unsec. unsub. notes 6 3/4s, 2036 (Spain)			5,000	6,270
Kinder Morgan Energy Partners LP sr. unsec. unsub. notes 5.4s, 2044			1,000	959
Kinder Morgan, Inc./DE sr. notes Ser. GMTN, 7 3/4s, 2032			5,000	5,891
PPL WEM Holdings, Ltd. 144A sr. unsec. notes 5 3/8s, 2021 (United Kingdom)			15,000	16,960
Puget Sound Energy, Inc. jr. sub. FRN Ser. A, 6.974s, 2067			7,000	6,650
Texas-New Mexico Power Co. 144A 1st mtge. bonds Ser. A, 9 1/2s, 2019			5,000	6,256
TransCanada PipeLines, Ltd. jr. unsec. sub. FRN 6.35s, 2067 (Canada)			10,000	9,538
Westar Energy, Inc. sr. mtge. bonds 8 5/8s, 2018			15,000	18,382
Wisconsin Energy Corp. jr. unsec. sub. FRN 6 1/4s, 2067			5,000	4,819
				255,132
Total corporate bonds and notes (cost $1,885,598)				$1,923,473
CONVERTIBLE PREFERRED STOCKS (6.0%)(a)
			Shares	Value
Basic materials (0.3%)
Alcoa, Inc. Ser. 1, $2.688 cv. pfd.			1,090	$47,653
Smurfit-Stone Container Corp. escrow zero % cv. pfd.(F)			1,775	18
Weyerhaeuser Co. Ser. A, $3.188 cv. pfd.(R)			805	43,646
				91,317
Capital goods (0.3%)
United Technologies Corp. $3.75 cv. pfd.			1,492	90,893
				90,893
Communication services (0.8%)
American Tower Corp. $5.50 cv. pfd.(R)			765	77,617
Cincinnati Bell, Inc. Ser. B, $3.378 cum. cv. pfd.			800	39,300
Crown Castle International Corp. Ser. A, $4.50 cv. pfd.(R)			357	36,717
Iridium Communications, Inc. 7.00% cv. pfd.			135	15,989
Iridium Communications, Inc. Ser. B, 6.75% cv. pfd.			25	9,375
T-Mobile US, Inc. Ser. A, $2.75 cv. pfd.			816	56,116
				235,114
Consumer cyclicals (0.9%)
FelCor Lodging Trust, Inc. Ser. A, $0.488 cum. cv. pfd.(R)			1,505	38,730
Fiat Chrysler Automobiles NV Ser. FCAU, $7.875 cv. pfd. (United Kingdom)(NON)			1,260	173,329
Stanley Black & Decker, Inc. $6.25 cv. pfd.			468	55,392
				267,451
Consumer staples (0.2%)
Tyson Foods, Inc. $2.375 cv. pfd.			913	47,449
				47,449
Energy (0.6%)
Chesapeake Energy Corp. 144A 5.75% cum. cv. pfd.			50	41,844
Chesapeake Energy Corp. 144A 5.75% cv. pfd.			107	89,606
Halcon Resources Corp. Ser. A, 5.75% cv. pfd.			23	5,864
Southwestern Energy Co. Ser. B, $3.125 cv. pfd.			611	33,758
				171,072
Financials (1.6%)
Alexandria Real Estate Equities, Inc. Ser. D, $1.75 cv. pfd.(R)			1,688	49,216
AMG Capital Trust II $2.575 cv. pfd.			1,145	70,274
Banc of California, Inc. $4.00 cv. pfd.			311	18,996
Bank of America Corp. Ser. L, 7.25% cv. pfd.			168	191,940
EPR Properties Ser. C, $1.438 cv. pfd.(R)			2,069	49,397
Health Care REIT, Inc. Ser. I, $3.25 cv. pfd.(R)			697	44,477
Maiden Holdings, Ltd. Ser. B, $3.625 cv. pfd. (Bermuda)			644	32,303
Wells Fargo & Co. Ser. L, 7.50% cv. pfd.			47	56,694
				513,297
Health care (0.5%)
Actavis PLC Ser. A, 5.50% cv. pfd.(NON)			134	142,036
Alere, Inc. Ser. B, 3.00% cv. pfd.			69	23,930
				165,966
Transportation (0.1%)
Genesee & Wyoming, Inc. $5.00 cv. pfd.			237	25,162
				25,162
Utilities and power (0.7%)
Dominion Resources, Inc./VA $3.188 cv. pfd.			1,094	55,116
Dynegy, Inc. Ser. A, $5.375 cv. pfd.			212	23,740
El Paso Energy Capital Trust I $2.375 cv. pfd.			965	57,870
Exelon Corp. $3.25 cv. pfd.			727	35,121
NextEra Energy, Inc. $2.90 cv. pfd.			1,096	62,395
				234,242
Total convertible preferred stocks (cost $1,724,857)				$1,841,963
U.S. TREASURY OBLIGATIONS (3.5%)(a)
			Principal amount	Value
U.S. Treasury Bonds
3 3/4s, November 15, 2043(SEGSF)(SEGCCS)			$60,000	$70,626
2 3/4s, August 15, 2042(SEGCCS)			40,000	39,061
U.S. Treasury Notes
2 3/4s, November 15, 2023(SEGSF)			160,000	169,485
2 3/8s, August 15, 2024(SEGSF)			80,000	82,043
2s, November 30, 2020			180,000	183,743
1 3/4s, May 31, 2016			130,000	131,855
1 3/8s, September 30, 2018			90,000	90,899
1 1/8s, December 31, 2019			70,000	69,108
1s, August 31, 2016			10,000	10,075
0 3/4s, March 31, 2018(SEGCCS)			190,000	189,227
0 3/4s, December 31, 2017			60,000	59,907
Total U.S. treasury Obligations (cost $1,083,214)				$1,096,029
MORTGAGE-BACKED SECURITIES (1.2%)(a)
			Principal amount	Value
Banc of America Commercial Mortgage Trust Ser. 06-5, Class A3, 5.39s, 2047			$11,000	$11,000
Banc of America Merrill Lynch Commercial Mortgage, Inc. Ser. 05-4, Class A5A, 4.933s, 2045(F)			3,459	3,467
Citigroup Commercial Mortgage Trust
FRB Ser. 07-C6, Class A4, 5.711s, 2049			10,000	10,735
Ser. 14-GC21, Class AS, 4.026s, 2047			14,000	14,893
COMM Mortgage Pass-Through Certificates FRB Ser. 14-CR14, Class XA, IO, 0.885s, 2047			378,310	17,451
COMM Mortgage Trust
FRB Ser. 13-LC13, Class XA, IO, 1.424s, 2046			139,720	9,604
FRB Ser. 14-LC15, Class XA, IO, 1.41s, 2047(F)			170,770	13,456
FRB Ser. 14-CR18, Class XA, IO, 1.297s, 2047			99,277	7,425
FRB Ser. 14-CR16, Class XA, IO, 1.263s, 2047			189,922	13,741
FRB Ser. 14-UBS6, Class XA, IO, 1.082s, 2047			99,673	7,006
FRB Ser. 13-CR13, Class XA, IO, 1.003s, 2023			125,910	6,816
Credit Suisse First Boston Mortgage Securities Corp. 144A FRB Ser. 03-C3, Class AX, IO, 1.908s, 2038			4,331	1
JPMorgan Chase Commercial Mortgage Securities Trust
Ser. 08-C2, Class ASB, 6 1/8s, 2051			4,520	4,720
Ser. 04-LN2, Class A2, 5.115s, 2041			710	711
LB Commercial Mortgage Trust 144A Ser. 98-C4, Class J, 5.6s, 2035			2,000	2,104
LB-UBS Commercial Mortgage Trust 144A FRB Ser. 05-C2, Class XCL, IO, 0.195s, 2040			4,975	—
Merrill Lynch Mortgage Trust Ser. 05-CIP1, Class AM, 5.107s, 2038			25,000	25,031
Morgan Stanley Bank of America Merrill Lynch Trust
FRB Ser. 13-C11, Class AS, 4.415s, 2046(F)			10,000	11,236
FRB Ser. 13-C10, Class AS, 4.082s, 2046			20,000	21,590
FRB Ser. 13-C13, Class XA, IO, 1.219s, 2046			196,646	13,897
FRB Ser. 13-C12, Class XA, IO, 0.998s, 2046			320,287	15,402
Morgan Stanley Capital I Trust Ser. 07-IQ14, Class A2, 5.61s, 2049			6,759	6,828
UBS-Barclays Commercial Mortgage Trust 144A FRB Ser. 12-C2, Class XA, IO, 1.739s, 2063			433,597	31,477
UBS-Citigroup Commercial Mortgage Trust 144A Ser. 11-C1, Class AS, 5.154s, 2045			10,000	11,373
Wachovia Bank Commercial Mortgage Trust FRB Ser. 06-C25, Class AJ, 5.712s, 2043			13,000	13,324
Wells Fargo Commercial Mortgage Trust FRB Ser. 13-LC12, Class AS, 4.301s, 2046			10,000	10,855
WF-RBS Commercial Mortgage Trust
Ser. 13-C18, Class AS, 4.387s, 2046			25,000	27,631
Ser. 13-UBS1, Class AS, 4.306s, 2046			26,000	28,568
WF-RBS Commercial Mortgage Trust 144A
FRB Ser. 12-C9, Class XA, IO, 2.195s, 2045			94,922	9,969
FRB Ser. 12-C10, Class XA, IO, 1.78s, 2045			192,337	18,245
Total mortgage-backed securities (cost $367,898)				$368,556
FOREIGN GOVERNMENT AND AGENCY BONDS AND NOTES (0.7%)(a)
			Principal amount	Value
Buenos Aires (Province of) 144A sr. unsec. unsub. notes 11 3/4s, 2015 (Argentina)			$200,000	$201,500
Total foreign government and agency bonds and notes (cost $197,401)				$201,500
SENIOR LOANS (0.2%)(a)(c)
			Principal amount	Value
Caesars Entertainment Operating Co., Inc. bank term loan FRN Ser. B6, 11s, 2017			$66,169	$62,220
Grifols Worldwide Operations USA, Inc. bank term loan FRN 3.184s, 2021			9,925	9,947
Total senior loans (cost $73,422)				$72,167
MUNICIPAL BONDS AND NOTES (0.1%)(a)
			Principal amount	Value
CA State G.O. Bonds (Build America Bonds), 7 1/2s, 4/1/34			$10,000	$14,456
North TX, Tollway Auth. Rev. Bonds (Build America Bonds), 6.718s, 1/1/49			10,000	14,178
OH State U. Rev. Bonds (Build America Bonds), 4.91s, 6/1/40			5,000	5,882
Total municipal bonds and notes (cost $25,065)				$34,516
PREFERRED STOCKS (0.1%)(a)
			Shares	Value
Ally Financial, Inc. 144A 7.00% cum. pfd.			5	$5,050
Citigroup, Inc. Ser. K, $1.719 ARP			600	16,182
GMAC Capital Trust I Ser. 2, $2.031 cum. ARP			275	7,167
Total preferred stocks (cost $28,103)				$28,399
ASSET-BACKED SECURITIES (0.1%)(a)
			Principal amount	Value
Station Place Securitization Trust FRB Ser. 15-2, Class A, 1.235s, 2017			$28,000	$28,000
Total asset-backed securities (cost $28,000)				$28,000
WARRANTS (—%)(a)(NON)
	Expiration date	Strike Price	Warrants	Value
Tower Semiconductor, Ltd. 144A (Israel)(F)	6/30/15	$1.70	6,345	$—
Total warrants (cost $1,269)				$—
SHORT-TERM INVESTMENTS (35.0%)(a)
			Principal amount/shares	Value
Putnam Cash Collateral Pool, LLC 0.23%(d)		Shares	151,725	$151,725
Putnam Money Market Liquidity Fund 0.08%(AFF)		Shares	923,880	923,880
Putnam Short Term Investment Fund 0.07%(AFF)		Shares	9,645,137	9,645,137
U.S. Treasury Bills 0.03%, July 16, 2015(SEG)(SEGCCS)			$100,000	99,997
Total short-term investments (cost $10,820,739)				$10,820,739
TOTAL INVESTMENTS
Total investments (cost $30,192,914)(b)				$31,212,321

FORWARD CURRENCY CONTRACTS at 5/31/15 (aggregate face value $613,118) (Unaudited)
						Unrealized
		Contract	Delivery		Aggregate	appreciation/
Counterparty	Currency	type	date	Value	face value	(depreciation)
Barclays Bank PLC
	Euro	Sell	6/17/15	$6,371	$6,548	$177
	Hong Kong Dollar	Buy	8/19/15	43,795	43,805	(10)
	Japanese Yen	Buy	8/19/15	24,063	24,910	(847)
	Singapore Dollar	Buy	8/19/15	6,072	6,171	(99)
	Swiss Franc	Buy	6/17/15	6,920	6,819	101
Citibank, N.A.
	Australian Dollar	Sell	7/15/15	38,216	37,999	(217)
	Danish Krone	Buy	6/17/15	31,224	31,756	(532)
	Euro	Buy	6/17/15	14,940	14,724	216
	Japanese Yen	Sell	8/19/15	6,732	6,970	238
Credit Suisse International
	Australian Dollar	Sell	7/15/15	3,967	3,772	(195)
	Euro	Sell	6/17/15	24,936	24,656	(280)
	Japanese Yen	Sell	8/19/15	527	536	9
	New Zealand Dollar	Sell	7/15/15	5,724	5,993	269
	Norwegian Krone	Sell	6/17/15	2,084	2,097	13
	Swedish Krona	Buy	6/17/15	5,924	5,833	91
	Swiss Franc	Buy	6/17/15	12,029	11,702	327
Deutsche Bank AG
	Australian Dollar	Buy	7/15/15	1,907	1,896	11
	British Pound	Sell	6/17/15	53,488	53,804	316
	Euro	Buy	6/17/15	53,937	54,902	(965)
	Swedish Krona	Buy	6/17/15	4,622	4,723	(101)
Goldman Sachs International
	Euro	Buy	6/17/15	5,602	5,733	(131)
HSBC Bank USA, National Association
	British Pound	Buy	6/17/15	6,877	6,918	(41)
	Euro	Sell	6/17/15	11,644	12,335	691
	Japanese Yen	Sell	8/19/15	19,282	19,293	11
JPMorgan Chase Bank N.A.
	Australian Dollar	Sell	7/15/15	1,907	1,896	(11)
	British Pound	Buy	6/17/15	1,223	1,672	(449)
	Euro	Sell	6/17/15	53,607	54,015	408
	Japanese Yen	Buy	8/19/15	20,365	21,082	(717)
	New Zealand Dollar	Sell	7/15/15	5,441	5,697	256
	Norwegian Krone	Sell	6/17/15	24,233	24,387	154
	Singapore Dollar	Buy	8/19/15	12,514	12,715	(201)
	Swedish Krona	Buy	6/17/15	6,476	6,617	(141)
	Swiss Franc	Buy	6/17/15	7,558	7,452	106
	Swiss Franc	Sell	6/17/15	7,665	7,190	(475)
State Street Bank and Trust Co.
	Euro	Sell	6/17/15	1,428	1,461	33
	Israeli Shekel	Sell	7/15/15	362	353	(9)
	Japanese Yen	Buy	8/19/15	7,244	7,500	(256)
	Swedish Krona	Sell	6/17/15	6,112	6,242	130
	Swiss Franc	Sell	6/17/15	8,836	8,715	(121)
UBS AG
	Australian Dollar	Buy	7/15/15	6,179	6,144	35
	British Pound	Buy	6/17/15	16,505	16,005	500
	Euro	Buy	6/17/15	20,213	20,524	(311)
	Swiss Franc	Buy	6/17/15	7,132	7,034	98
WestPac Banking Corp.
	Japanese Yen	Sell	8/19/15	2,436	2,522	86
Total						$(1,833)

FUTURES CONTRACTS OUTSTANDING at 5/31/15 (Unaudited)
				Unrealized
	Number of		Expiration	appreciation/
	contracts	Value	date	(depreciation)
U.S. Treasury Note 2 yr (Long)	2	$437,719	Sep-15	$590
U.S. Treasury Note 5 yr (Long)	1	119,727	Sep-15	459
Total				$1,049

	OTC CREDIT DEFAULT CONTRACTS OUTSTANDING at 5/31/15 (Unaudited)
			Upfront				Payments
			premium			Termi-	received	Unrealized
	Swap counterparty/		received		Notional	nation	(paid) by fund	appreciation/
	Referenced debt*	Rating***	(paid)**		amount	date	per annum	(depreciation)
	Barclays Bank PLC
	EM Series 23 Index	BBB/P	$100,878		$1,173,000	6/20/20	100 bp	$163
	EM Series 23 Index	BBB/P	201,985		1,990,000	6/20/20	100 bp	33,221
	Total		$302,863	$33,384
*	Payments related to the referenced debt are made upon a credit default event.
**	Upfront premium is based on the difference between the original spread on issue and the market spread on day of execution.
***	Ratings are presented for credit default contracts in which the fund has sold protection on the underlying referenced debt. Ratings for an underlying index represent the average of the ratings of all the securities included in that index. The Moody's, Standard & Poor's or Fitch ratings are believed to be the most recent ratings available at May 31, 2015. Securities rated by Putnam are indicated by “/P.”

	CENTRALLY CLEARED CREDIT DEFAULT CONTRACTS OUTSTANDING at 5/31/15 (Unaudited)
			Upfront				Payments
			premium			Termi-	received	Unrealized
			received		Notional	nation	(paid) by fund	appreciation/
	Referenced debt*	Rating***	(paid)**		amount	date	per annum	(depreciation)
	NA HY Series 24 Index	B+/P	$(305,051)		$4,253,000	6/20/20	500 bp	$31,783
	Total		$(305,051)	$31,783
*	Payments related to the referenced debt are made upon a credit default event.
**	Upfront premium is based on the difference between the original spread on issue and the market spread on day of execution.
***	Ratings are presented for credit default contracts in which the fund has sold protection on the underlying referenced debt. Ratings for an underlying index represent the average of the ratings of all the securities included in that index. The Moody's, Standard & Poor's or Fitch ratings are believed to be the most recent ratings available at May 31 2015. Securities rated by Putnam are indicated by “/P.”

Key to holding's abbreviations
ADR	American Depository Receipts: represents ownership of foreign securities on deposit with a custodian bank
ARP	Adjustable Rate Preferred Stock: the rate shown is the current interest rate at the close of the reporting period
ETF	Exchange Traded Fund
FRB	Floating Rate Bonds: the rate shown is the current interest rate at the close of the reporting period
FRN	Floating Rate Notes: the rate shown is the current interest rate or yield at the close of the reporting period
GMTN	Global Medium Term Notes
G.O. Bonds	General Obligation Bonds
IO	Interest Only
SPDR	S&P Depository Receipts

	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 March 1, 2015 through May 31, 2015 (the reporting period). Within the following notes to the portfolio, references to “ASC 820” represent Accounting Standards Codification 820 Fair Value Measurements and Disclosures, references to “Putnam Management” represent Putnam Investment Management, LLC, the fund's manager, an indirect wholly-owned subsidiary of Putnam Investments, LLC and references to “OTC”, if any, represent over-the-counter.
(a)	Percentages indicated are based on net assets of $30,914,135.
(b)	The aggregate identified cost on a tax basis is $30,221,905, resulting in gross unrealized appreciation and depreciation of $1,590,269 and $599,853, respectively, or net unrealized appreciation of $990,416.
(NON)	This security is non-income-producing.
(STP)	The interest rate and date shown parenthetically represent the new interest rate to be paid and the date the fund will begin accruing interest at this rate.
(RES)	This security is restricted with regard to public resale. The total fair value of this security and any other restricted securities (excluding 144A securities), if any, held at the close of the reporting period was $5,390, or less than 0.1% of net assets.
(PIK)	Income may be received in cash or additional securities at the discretion of the issuer.
(AFF)	Affiliated company. For investments in Putnam Money Market Liquidity Fund and 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, or involving securities of companies in which the fund owned at least 5% of the outstanding voting securities, were as follows:
	Name of affiliate	Fair value at the beginning of the reporting period	Purchase cost	Sale proceeds	Investment income	Capital gain distributions	Fair value at the end of the reporting period
	Putnam Money Market Liquidity Fund*	$—	$1,043,523	$119,643	$103	$—	$923,880
	Putnam Short Term Investment Fund*	9,337,360	2,074,605	1,766,828	1,856	—	9,645,137
	Putnam Absolute Return 700 Fund Class Y	2,980,118	895,180	751,042	—	—	3,160,489
	Totals	$12,317,478	$4,013,308	$2,637,513	$1,959	$—	$13,729,506
	* Management fees charged to Putnam Money Market Liquidity Fund and Putnam Short Term Investment Fund have been waived by Putnam Management.
(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.
(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.
(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.
(c)	Senior loans are exempt from registration under the Securities Act of 1933, as amended, but contain certain restrictions on resale and cannot be sold publicly. These loans pay interest at rates which adjust periodically. The interest rates shown for senior loans are the current interest rates at the close of the reporting period. Senior loans are also subject to mandatory and/or optional prepayment which cannot be predicted. As a result, the remaining maturity may be substantially less than the stated maturity shown. Senior loans are purchased or sold on a when-issued or delayed delivery basis and may be settled a month or more after the trade date, which from time to time can delay the actual investment of available cash balances; interest income is accrued based on the terms of the securities.
	Senior loans can be acquired through an agent, by assignment from another holder of the loan, or as a participation interest in another holder’s portion of the loan. When the fund invests in a loan or participation, the fund is subject to the risk that an intermediate participant between the fund and the borrower will fail to meet its obligations to the fund, in addition to the risk that the borrower under the loan may default on its obligations.
(d)	Affiliated company. The fund may lend securities, through its agent, to qualified borrowers in order to earn additional income. The loans are collateralized by cash in an amount at least equal to the fair value of the securities loaned. The fair value of securities loaned is determined daily and any additional required collateral is allocated to the fund on the next business day. The risk of borrower default will be borne by the fund’s agent; the fund will bear the risk of loss with respect to the investment of the cash collateral.
	The fund received cash collateral of $151,725, which is invested in Putnam Cash Collateral Pool, LLC, a limited liability company managed by an affiliate of Putnam Management. Investments in Putnam Cash Collateral Pool, LLC are valued at its closing net asset value each business day. There are no management fees charged to Putnam Cash Collateral Pool, LLC. The rate quoted in the security description is the annualized 7-day yield at the close of the reporting period. At the close of the reporting period, the value of securities loaned amounted to $147,798. Certain of these securities were sold prior to the close of the reporting period.
(F)	This security is valued at fair value following procedures approved by the Trustees. Securities may be classified as Level 2 or 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.
(R)	Real Estate Investment Trust.
(S)	This security is on loan, in part or in entirety, at the close of the reporting period.
	At the close of the reporting period, the fund maintained liquid assets totaling $7,976,720 to cover certain derivative contracts.
	Debt obligations are considered secured unless otherwise indicated.
	144A after the name of an issuer represents securities exempt from registration under Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers.
	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 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. Short-term securities with remaining maturities of 60 days or less may be valued at amortized cost, which approximates fair value, and are classified as Level 2 securities.
	Many securities markets and exchanges outside the U.S. close prior to the 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 close of the New York Stock Exchange. Accordingly, on certain days, the fund will fair value 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. These 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. Certain securities may be valued on the basis of a price provided by a single source. 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.
	Stripped securities: The fund may invest in stripped securities which represent a participation in securities that may be structured in classes with rights to receive different portions of the interest and principal. Interest-only securities receive all of the interest and principal-only securities receive all of the principal. If the interest-only securities experience greater than anticipated prepayments of principal, the fund may fail to recoup fully its initial investment in these securities. Conversely, principal-only securities increase in value if prepayments are greater than anticipated and decline if prepayments are slower than anticipated. The fair value of these securities is highly sensitive to changes in interest rates.
	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.
	Credit default contracts: The fund entered into OTC and/or centrally cleared credit default contracts to hedge credit risk, to hedge market risk and to gain exposure on individual names and/or baskets of securities.
	In OTC and centrally cleared credit default contracts, the protection buyer typically makes a periodic stream of payments to a counterparty, the protection seller, in exchange for the right to receive a contingent payment upon the occurrence of a credit event on the reference obligation or all other equally ranked obligations of the reference entity. Credit events are contract specific but may include bankruptcy, failure to pay, restructuring and obligation acceleration. For OTC credit default 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. Centrally cleared credit default contracts provide the same rights to the protection buyer and seller except the payments between parties, including upfront premiums, are settled through a central clearing agent through variation margin payments. Upfront and periodic payments received or paid by the fund for OTC and centrally cleared credit default contracts are recorded as realized gains or losses at the reset date or close of the contract. The OTC and centrally cleared credit default contracts are marked to market daily based upon quotations from an independent pricing service or market makers. Any change in value of OTC credit default contracts is recorded as an unrealized gain or loss. Daily fluctuations in the value of centrally cleared credit default contracts are recorded as unrealized gain or loss. Upon the occurrence of a credit event, the difference between the par value and fair value of the reference obligation, net of any proportional amount of the upfront payment, is recorded as a realized gain or loss.
	In addition to bearing the risk that the credit event will occur, the fund could be exposed to market risk due to unfavorable changes in interest rates or in the price of the underlying security or index or the possibility that the fund may be unable to close out its position at the same time or at the same price as if it had purchased the underlying reference obligations. In certain circumstances, the fund may enter into offsetting OTC and centrally cleared credit default contracts which would mitigate its risk of loss. The fund’s maximum risk of loss from counterparty risk, either as the protection seller or as the protection buyer, is the fair value of the contract. This risk may be mitigated for OTC credit default contracts by having a master netting arrangement between the fund and the counterparty and for centrally cleared credit default contracts through the daily exchange of variation margin. Counterparty risk is further mitigated with respect to centrally cleared credit default swap contracts due to the clearinghouse guarantee fund and other resources that are available in the event of a clearing member default. Where the fund is a seller of protection, the maximum potential amount of future payments the fund may be required to make is equal to the notional amount.
	For the fund's average notional amount on credit default 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 (Master Agreements) with certain counterparties that govern OTC derivative and foreign exchange contracts 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, is 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.
	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 and 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.
	At the close of the reporting period, the fund had a net liability position of $272,615 on open derivative contracts subject to the Master Agreements. Collateral posted by the fund at period end for these agreements totaled $188,074 and may include amounts related to unsettled agreements.

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	$334,356	$68,969	$—
Capital goods	346,207	43,974	—
Communication services	253,973	77,506	—
Conglomerates	39,728	35,088	—
Consumer cyclicals	645,139	181,220	—
Consumer staples	593,771	116,319	—
Energy	392,937	42,808	—
Financials	3,573,958	247,688	—
Health care	730,314	92,245	—
Technology	683,696	57,936	—
Transportation	111,612	72,906	—
Utilities and power	254,272	—	—
Total common stocks	7,959,963	1,036,659	—
Asset-backed securities	—	28,000	—
Convertible bonds and notes	—	2,503,413	2,984
Convertible preferred stocks	273,754	1,568,191	18
Corporate bonds and notes	—	1,923,473	—
Foreign government and agency bonds and notes	—	201,500	—
Investment companies	3,293,960	—	—
Mortgage-backed securities	—	368,556	—
Municipal bonds and notes	—	34,516	—
Preferred stocks	23,349	5,050	—
Senior loans	—	72,167	—
U.S. treasury obligations	—	1,096,029	—
Warrants	—	—	—
Short-term investments	10,569,017	251,722	—
Totals by level	$22,120,043	$9,089,276	$3,002
		Valuation inputs
Other financial instruments:	Level 1	Level 2	Level 3
Forward currency contracts	$—	$(1,833)	$—
Futures contracts	1,049	—	—
Credit default contracts	—	67,355	—
Totals by level	$1,049	$65,522	$—
* Common stock classifications are presented at the sector level, which may differ from the fund's portfolio presentation.
During the reporting period, transfers within the fair value hierarchy, if any, (other than certain transfers involving non-U.S. equity securities as described in the Security valuation note above) did not represent, in the aggregate, more than 1% of the fund's net assets measured as of the end of the period.
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.
Fair Value of Derivative Instruments as of the close of the reporting period
	Asset derivatives	Liability derivatives
Derivatives not accounted for as hedging instruments under ASC 815	Fair value	Fair value
Credit contracts	$336,834	$269,479
Foreign exchange contracts	4,276	6,109
Equity contracts	—	—
Interest rate contracts	1,049	—
Total	$342,159	$275,588
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 as follows 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)		3
Forward currency contracts (contract amount)		$790,000
OTC credit default contracts (notional)		$2,900,000
Centrally cleared credit default contracts (notional)		$4,200,000
Warrants (number of warrants)		6,000

	The following table summarizes any derivatives, repurchase agreements and reverse repurchase agreements, at the end of the reporting period, that are subject to an enforceable master netting agreement or similar agreement. For securities lending transactions, if applicable, see note "(d)" above, and for borrowing transactions associated with securities sold short, if applicable, see the "Short sales of securities" note above.
		Barclays Bank PLC	Barclays Capital Inc. (clearing broker)	Citibank, N.A.	Credit Suisse International	Deutsche Bank AG	Goldman Sachs International	HSBC Bank USA, National Association	JPMorgan Chase Bank N.A.	Merrill Lynch, Pierce, Fenner & Smith, Inc.	State Street Bank and Trust Co.	UBS AG	WestPac Banking Corp.	Total
	Assets:
	OTC Credit default contracts*#	$—	$—	$—	$—	$—	$—	$—	$—	$—	$—	$—	$—	$—
	Centrally cleared credit default contracts§	—	971	—	—	—	—	—	—	—	—	—	—	971
	Futures contracts§	—	—	—	—	—	—	—	—	391	—	—	—	391
	Forward currency contracts#	278	—	454	709	327	—	702	924	—	163	633	86	4,276
	Total Assets	$278	$971	$454	$709	$327	$—	$702	$924	$391	$163	$633	$86	$5,638
	Liabilities:
	OTC Credit default contracts*#	269,479	—	—	—	—	—	—	—	—	—	—	—	269,479
	Centrally cleared credit default contracts§	—	—	—	—	—	—	—	—	—	—	—	—	—
	Futures contracts§	—	—	—	—	—	—	—	—	—	—	—	—	—
	Forward currency contracts#	956	—	749	475	1,066	131	41	1,994	—	386	311	—	6,109
	Total Liabilities	$270,435	$—	$749	$475	$1,066	$131	$41	$1,994	$—	$386	$311	$—	$275,588
	Total Financial and Derivative Net Assets	$(270,157)	$971	$(295)	$234	$(739)	$(131)	$661	$(1,070)	$391	$(223)	$322	$86	$(269,950)
	Total collateral received (pledged)##†	$(188,074)	$—	$—	$—	$—	$—	$—	$—	$—	$—	$—	$—
	Net amount	$(82,083)	$971	$(295)	$234	$(739)	$(131)	$661	$(1,070)	$391	$(223)	$322	$86
*	Excludes premiums, if any.
†	Additional collateral may be required from certain brokers based on individual agreements.
#	Covered by master netting agreement.
##	Any over-collateralization of total financial and derivative net assets is not shown. Collateral may include amounts related to unsettled agreements.
§	Includes current day's variation margin only, which is not collateralized.  Cumulative appreciation/(depreciation) for futures contracts and centrally cleared swap contracts is represented in the tables listed after the fund's portfolio.
	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

Item 2. Controls and Procedures:

(a) The registrant’s principal executive officer and principal financial officer have concluded, based on their evaluation of the effectiveness of the design and operation of the registrant’s disclosure controls and procedures as of a date within 90 days of the filing date of this report, that the design and operation of such procedures are generally effective to provide reasonable assurance that information required to be disclosed by the registrant in this report is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms.

(b) Changes in internal control over financial reporting: Not applicable

Item 3. Exhibits:

Separate certifications for the principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Investment Company Act of 1940, as amended, are filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Putnam Funds Trust

By (Signature and Title):

/s/ Janet C. Smith
Janet C. Smith
Principal Accounting Officer
Date: July 29, 2015

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By (Signature and Title):

/s/ Jonathan S. Horwitz
Jonathan S. Horwitz
Principal Executive Officer
Date: July 29, 2015

By (Signature and Title):

/s/ Steven D. Krichmar
Steven D. Krichmar
Principal Financial Officer
Date: July 29, 2015