N-Q 1 a_emergingmarketsequity.htm PUTNAM FUNDS TRUST a_emergingmarketsequity.htm


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: August 31, 2017
Date of reporting period: May 31, 2017



Item 1. Schedule of Investments:













Putnam Emerging Markets Equity Fund

The fund's portfolio
5/31/17 (Unaudited)
COMMON STOCKS (94.1%)(a)
Shares Value
Airlines (0.8%)
Aeroflot - Russian Airlines PJSC (Russia)(NON) 114,300 $379,775
379,775
Auto components (3.1%)
Exide Industries, Ltd. (India) 70,842 252,811
Hankook Tire Co., Ltd. (South Korea) 7,108 386,636
Minth Group, Ltd. (China) 56,000 227,807
Nemak SAB de CV 144A (Mexico) 350,280 346,410
Nexteer Automotive Group, Ltd. 121,000 184,779
1,398,443
Automobiles (0.6%)
Maruti Suzuki India, Ltd. (India) 2,296 256,610
256,610
Banks (19.9%)
Banco Macro SA ADR (Argentina) 5,562 497,632
Bank of China, Ltd. (China) 1,906,000 953,911
Bank Tabungan Negara Persero Tbk PT (Indonesia) 2,042,400 383,333
China Construction Bank Corp. (China) 837,000 691,722
Credicorp, Ltd. (Peru) 4,375 732,900
CTBC Financial Holding Co., Ltd. (Taiwan) 637,000 405,550
Dubai Islamic Bank PJSC (United Arab Emirates)(NON) 256,401 405,578
Grupo Supervielle SA ADR (Argentina) 15,114 259,507
Hana Financial Group, Inc. (South Korea) 10,082 369,655
HDFC Bank, Ltd. (India) 18,582 471,232
Industrial & Commercial Bank of China, Ltd. (China) 1,433,000 958,086
Itau Unibanco Holding SA ADR (Preference) (Brazil) 49,041 535,037
Itausa - Investimentos Itau SA (Preference) (Brazil) 88,358 244,381
Itausa - Investimentos Itau SA (Brazil) 52 139
Sberbank of Russia PJSC ADR (Russia) 90,584 1,010,012
Shinhan Financial Group Co., Ltd. (South Korea) 10,968 484,430
State Bank of India (India) 92,603 413,786
Turkiye Garanti Bankasi AS (Turkey) 95,158 258,941
9,075,832
Beverages (0.4%)
Thai Beverage PCL (Thailand) 270,600 171,123
171,123
Capital markets (0.5%)
Edelweiss Financial Services, Ltd. (India) 91,400 245,287
245,287
Chemicals (3.1%)
Asian Paints, Ltd. (India) 9,967 177,836
Formosa Plastics Corp. (Taiwan) 81,000 241,554
Grand Pacific Petrochemical (Taiwan) 327,000 224,494
Hansol Chemical Co., Ltd. (South Korea) 3,098 212,510
Hanwha Chemical Corp. (South Korea) 7,807 207,796
LG Chemical, Ltd. (South Korea) 1,213 327,194
1,391,384
Commercial services and supplies (0.5%)
Sunny Friend Environmental Technology Co., Ltd. (Taiwan) 37,000 207,271
207,271
Construction and engineering (3.4%)
China Communications Construction Co., Ltd. (China) 211,000 284,852
China State Construction International Holdings, Ltd. (China) 190,000 329,648
Concord New Energy Group, Ltd. (China) 842,000 37,278
CTCI Corp. (Taiwan) 174,000 286,635
Mota-Engil SGPS SA (Portugal) 97,196 296,983
NCC, Ltd./India (India)(NON) 228,138 310,808
1,546,204
Consumer finance (0.8%)
Shriram Transport Finance Co., Ltd. (India) 24,555 388,191
388,191
Diversified consumer services (1.4%)
China Maple Leaf Educational Systems, Ltd. (China) 220,000 190,002
Estacio Participacoes SA (Brazil) 29,300 157,458
Ser Educacional SA 144A (Brazil) 39,600 294,435
641,895
Electric utilities (0.7%)
Power Grid Corp. of India, Ltd. (India) 96,847 312,141
312,141
Electronic equipment, instruments, and components (2.6%)
Elite Material Co., Ltd. (Taiwan) 67,000 278,433
Hollysys Automation Technologies, Ltd. (China) 17,349 277,411
Hon Hai Precision Industry Co., Ltd. (Taiwan) 189,000 647,196
1,203,040
Food and staples retail (3.3%)
BGF retail Co., Ltd. (South Korea) 1,987 247,576
BIM Birlesik Magazalar AS (Turkey) 10,094 179,540
Cia Brasileira de Distribuicao Grupo Pao de Acucar ADR (Brazil) 13,514 285,281
Dino Polska SA 144A (Poland)(NON) 18,811 207,980
X5 Retail Group NV GDR (Russia)(NON) 15,540 562,548
1,482,925
Health-care providers and services (0.7%)
Qualicorp SA (Brazil) 37,586 325,456
325,456
Hotels, restaurants, and leisure (0.6%)
Bloomberry Resorts Corp. (Philippines)(NON) 1,061,800 200,521
Gourmet Master Co., Ltd. (Taiwan) 6,000 65,827
266,348
Household durables (2.0%)
Basso Industry Corp. (Taiwan) 113,000 320,453
Coway Co., Ltd. (South Korea) 3,844 345,054
MRV Engenharia e Participacoes SA (Brazil) 65,808 263,358
928,865
Insurance (5.1%)
AIA Group, Ltd. (Hong Kong) 51,400 364,431
China Life Insurance Co., Ltd. (Taiwan) 348,000 341,301
Discovery, Ltd. (South Africa) 25,334 247,487
Dongbu Insurance Co., Ltd. (South Korea) 3,595 217,383
Hyundai Marine & Fire Insurance Co., Ltd. (South Korea) 7,365 248,329
Ping An Insurance Group Co. of China, Ltd. (China) 141,000 903,806
2,322,737
Internet and direct marketing retail (0.4%)
Delivery Hero Holding GmbH (acquired 6/12/15, cost $161,742) (Private) (Germany)(F)(RES)(NON) 21 148,942
FabFurnish GmbH (acquired 8/2/13, cost $1) (Private) (Brazil)(F)(RES)(NON) 2 2
Global Fashion Group SA (acquired 8/2/13, cost $87,766) (Private) (Brazil)(F)(RES)(NON) 2,072 19,093
New Bigfoot Other Assets GmbH (acquired 8/2/13, cost $1) (Private) (Brazil)(F)(RES)(NON) 1 1
New Middle East Other Assets GmbH (acquired 8/2/13, cost $1) (Private) (Brazil)(F)(RES)(NON) 1 1
168,039
Internet software and services (10.4%)
Alibaba Group Holding, Ltd. ADR (China)(NON) 18,877 2,311,677
Tencent Holdings, Ltd. (China) 71,200 2,445,039
4,756,716
IT Services (1.0%)
Chinasoft International, Ltd. (China)(NON) 540,000 291,047
Vakrangee, Ltd. (India)(NON) 32,540 184,034
475,081
Machinery (0.9%)
Jain Irrigation Systems, Ltd. (India)(NON) 254,372 398,195
398,195
Media (1.5%)
Naspers, Ltd. Class N (South Africa) 3,354 694,471
694,471
Metals and mining (1.9%)
Anglo American PLC (United Kingdom)(NON) 13,583 182,260
Hindalco Industries, Ltd. (India) 140,180 436,053
United Co RUSAL PLC (Russia) 546,000 267,656
885,969
Multiline retail (0.8%)
Poya International Co., Ltd. (Taiwan) 25,000 342,847
342,847
Oil, gas, and consumable fuels (6.6%)
China Petroleum & Chemical Corp. (Sinopec) (China) 338,000 277,165
Gazprom Neft PAO ADR (Russia) 24,497 426,248
Indian Oil Corp., Ltd. (India) 50,983 339,347
Lukoil PJSC ADR (Russia) 16,701 797,473
MOL Hungarian Oil & Gas PLC (Hungary) 4,391 357,091
Petroleo Brasileiro SA - Petrobras ADR (Brazil)(NON) 42,371 359,306
Petroleo Brasileiro SA - Petrobras ADR (Preference) (Brazil)(NON) 11,600 92,684
PTT PCL (Foreign depositary receipts) (Thailand) 29,800 343,846
2,993,160
Paper and forest products (0.6%)
Mondi, Ltd. (South Africa) 10,003 263,358
263,358
Personal products (1.4%)
Amorepacific Corp. (South Korea) 870 266,533
CLIO Cosmetics Co., Ltd. (South Korea) 5,068 179,707
Emami, Ltd. (India) 10,747 181,385
627,625
Pharmaceuticals (3.0%)
Aspen Pharmacare Holdings, Ltd. (South Africa) 12,534 283,843
China Traditional Chinese Medicine Holdings Co., Ltd. (China) 566,000 301,429
Richter Gedeon Nyrt (Hungary) 22,236 568,384
Shanghai Fosun Pharmaceutical (Group) Co., Ltd. (China) 56,500 216,428
1,370,084
Real estate management and development (2.1%)
Aldar Properties PJSC (United Arab Emirates) 357,747 215,252
China Resources Land, Ltd. (China) 116,000 340,890
Emaar Properties PJSC (United Arab Emirates)(NON) 211,338 409,097
965,239
Semiconductors and semiconductor equipment (5.0%)
SK Hynix, Inc. (South Korea) 7,795 396,852
Taiwan Semiconductor Manufacturing Co., Ltd. (Taiwan) 278,889 1,882,192
2,279,044
Software (0.5%)
NCSoft Corp. (South Korea) 676 228,533
228,533
Specialty retail (0.4%)
Beauty Community PCL (Foreign depoitary shares) (Thailand) 626,800 198,750
198,750
Technology hardware, storage, and peripherals (5.1%)
Samsung Electronics Co., Ltd. (South Korea) 1,010 2,016,211
Samsung Electronics Co., Ltd. (Preference) (South Korea) 209 326,493
2,342,704
Transportation infrastructure (1.3%)
EcoRodovias Infraestrutura e Logistica SA (Brazil) 67,184 191,008
Promotora y Operadora de Infraestructura SAB de CV (Mexico) 37,214 387,927
578,935
Water utilities (0.9%)
China Water Affairs Group, Ltd. (China) 604,000 395,301
395,301
Wireless telecommunication services (0.8%)
Safaricom, Ltd. (Kenya) 1,606,000 349,806
349,806
Total common stocks (cost $37,015,978) $42,857,384

WARRANTS (2.3%)(a)
Expiration date Strike Price Warrants Value
Bupa Arabia for Cooperative Insurance Co. 144A (Saudi Arabia)(NON) 3/22/18 $0.00 8,478 $259,775
Herfy Food Services Co. 144A (Saudi Arabia)(NON) 2/7/19 0.00 11,470 171,246
Shanghai International Airport Co., Ltd. 144A (China)(NON) 5/7/18 0.00 49,800 275,831
Wuliangye Yibin Co., Ltd. 144A (China) 4/12/18 0.00 51,400 360,802
Total warrants (cost $995,789) $1,067,654

CONVERTIBLE PREFERRED STOCKS (—%)(a)
Shares Value
Global Fashion Group SA zero % cv. pfd. (acquired 7/11/16, cost $10,574) (Brazil) (Private)(F)(RES) 1,396 $13,121
Total convertible preferred stocks (cost $10,574) $13,121

SHORT-TERM INVESTMENTS (3.6%)(a)
Shares Value
Putnam Short Term Investment Fund 0.89%(AFF) 1,627,923 $1,627,923
Total short-term investments (cost $1,627,923) $1,627,923

TOTAL INVESTMENTS
Total investments (cost $39,650,264)(b) $45,566,082













Key to holding's abbreviations
ADR American Depository Receipts: represents ownership of foreign securities on deposit with a custodian bank
GDR Global Depository Receipts: represents ownership of foreign securities on deposit with a custodian bank
PJSC Public Joint Stock Company
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 September 1, 2016 through May 31, 2017 (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 $45,536,572.
(b) The aggregate identified cost on a tax basis is $39,966,499, resulting in gross unrealized appreciation and depreciation of $6,311,343 and $711,760, respectively, or net unrealized appreciation of $5,599,583.
(NON) This security is non-income-producing.
(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 $181,160, or 0.4% of net assets.
(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 at the beginning of the reporting period Purchase cost Sale proceeds Investment income Fair value at the end of the reporting period
Putnam Short Term Investment Fund** $1,033,678 $19,524,635 $18,930,390 $5,297 $1,627,923
Totals $1,033,678 $19,524,635 $18,930,390 $5,297 $1,627,923
** Management fees charged to Putnam Short Term Investment Fund have been waived by Putnam Management.

(F) This security is valued by Putnam Management 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.
144A after the name of an issuer represents securities exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers.

DIVERSIFICATION BY COUNTRY
Distribution of investments by country of risk at the close of the reporting period, excluding collateral received, if any (as a percentage of Portfolio Value):
China 26.5%
South Korea 14.2
Taiwan 11.5
India 9.6
Russia 7.5
Brazil 6.1
United States 4.0
South Africa 3.3
United Arab Emirates 2.3
Hungary 2.0
Argentina 1.7
Mexico 1.6
Peru 1.6
Thailand 1.6
Turkey 1.0
Saudi Arabia 0.9
Indonesia 0.8
Hong Kong 0.8
Kenya 0.8
Portugal 0.6
Poland 0.5
Other 1.1
Total 100.0%

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.
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. Securities quoted in foreign currencies, if any, are translated into U.S. dollars at the current exchange rate. Short-term securities with remaining maturities of 60 days or less are valued using an independent pricing service approved by the Trustees, and are classified as Level 2 securities.
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.












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*:
    Consumer discretionary $4,218,808 $509,421 $168,039
    Consumer staples 2,100,288 181,385 —
    Energy 2,653,813 339,347 —
    Financials 10,513,551 1,518,496 —
    Health care 1,695,540 — —
    Industrials 2,401,377 709,003 —
    Information technology 11,101,084 184,034 —
    Materials 1,926,822 613,889 —
    Real estate 965,239 — —
    Telecommunication services 349,806 — —
    Utilities 395,301 312,141 —
Total common stocks 38,321,629 4,367,716 168,039
Convertible preferred stocks — — 13,121
Warrants — 1,067,654 —
Short-term investments 1,627,923 — —
Totals by level $39,949,552 $5,435,370 $181,160


* 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. Transfers are accounted for using the end of period pricing valuation method.
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
Equity contracts $1,067,654 $—
Total $1,067,654 $—


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:
Warrants (number of warrants)200,000

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



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 28, 2017

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 28, 2017

By (Signature and Title):
/s/ Janet C. Smith
Janet C. Smith
Principal Financial Officer
Date: July 28, 2017