N-Q 1 a_consecuritiesfund.htm PUTNAM CONVERTIBLE SECURITIES FUND a_consecuritiesfund.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: (811-02280)   
 
Exact name of registrant as specified in charter:  Putnam Convertible Securities Fund 
 
Address of principal executive offices: One Post Office Square, Boston, Massachusetts 02109 
 
Name and address of agent for service:  Beth S. Mazor, Vice President 
  One Post Office Square 
  Boston, Massachusetts 02109 
 
Copy to:    John W. Gerstmayr, Esq. 
  Ropes & Gray LLP 
  800 Boylston Street 
  Boston, Massachusetts 02199-3600 
 
Registrant’s telephone number, including area code:  (617) 292-1000 
 
Date of fiscal year end: October 31, 2011     
 
Date of reporting period: January 31, 2011     

 

Item 1. Schedule of Investments:



Putnam Convertible Securities Fund
The fund's portfolio
1/31/11 (Unaudited)

CONVERTIBLE BONDS AND NOTES (64.9%)(a)     
  Principal amount  Value 

 
Aerospace and defense (1.3%)     
AAR CORP. 144A cv. sr. unsec. notes 2 1/4s, 2016  $5,600,000  $5,593,000 
Triumph Group, Inc. 144A cv. sr. sub. notes 2 5/8s,     
2026  2,030,000  3,623,550 
    9,216,550 

 
Airlines (0.7%)     
AMR Corp. cv. company guaranty sr. unsub. notes     
6 1/4s, 2014  1,695,000  1,879,316 
Continental Airlines, Inc. cv. sr. unsec. unsub. notes     
4 1/2s, 2015  2,280,000  3,536,850 
    5,416,166 

 
Automotive (2.3%)     
Ford Motor Co. cv. sr. unsec. notes 4 1/4s, 2016  4,720,000  8,994,904 
TRW Automotive, Inc. 144A cv. company guaranty sr.     
notes 3 1/2s, 2015  3,500,000  7,533,750 
    16,528,654 

 
Beverage (0.6%)     
Molson Coors Brewing Co. cv. company guaranty sr.     
unsec. unsub. notes 2 1/2s, 2013  4,110,000  4,664,850 
    4,664,850 

 
Biotechnology (3.6%)     
Amgen, Inc. cv. sr. unsec. notes 3/8s, 2013  4,400,000  4,416,500 
Amylin Pharmaceuticals, Inc. cv. sr. unsec. notes 3s,     
2014  5,300,000  4,763,375 
Cubist Pharmaceuticals, Inc. cv. sr. unsec. notes     
2 1/2s, 2017  3,545,000  3,615,900 
Dendreon Corp. 144A cv. sr. unsec. sub. notes 4 3/4s,     
2014  565,000  2,000,100 
Kendle International, Inc. cv. sr. unsec. notes     
3 3/8s, 2012  3,800,000  3,576,750 
United Therapeutics Corp. cv. sr. unsec. notes 1/2s,     
2011  500,000  903,750 
United Therapeutics Corp. 144A cv. sr. unsec. notes     
1/2s, 2011  3,500,000  6,326,250 
    25,602,625 

 
Broadcasting (0.7%)     
XM Satellite Radio Holdings, Inc. 144A cv. sr. unsec.     
sub. notes 7s, 2014  4,223,000  5,335,338 
    5,335,338 

 
Cable television (1.2%)     
Virgin Media, Inc. cv. sr. unsec. notes 6 1/2s, 2016     
(United Kingdom)  5,450,000  8,502,000 
    8,502,000 

 
Coal (1.5%)     
International Coal Group, Inc. cv. company guaranty     
sr. unsec. notes 4s, 2017  2,158,000  3,858,288 
James River Coal Co. 144A cv. sr. unsec. notes 4 1/2s,     
2015  2,449,000  2,843,044 
Peabody Energy Corp. cv. jr. unsec. sub. debs. 4 3/4s,     
2041  3,000,000  3,802,500 
    10,503,832 

 
Commercial and consumer services (3.2%)     
Alliance Data Systems Corp. cv. sr. unsec. notes     
1 3/4s, 2013  6,300,000  6,843,375 
CBIZ, Inc. 144A cv. sr. sub. notes 4 7/8s, 2015  3,220,000  3,789,538 
Icahn Enterprises LP 144A cv. sr. unsec. notes FRN 4s,     
2013  5,400,000  5,184,000 
Icahn Enterprises LP/Icahn Enterprises Finance Corp.     
cv. sr. unsec. notes FRN 4s, 2013  765,000  734,400 
Live Nation Entertainment, Inc. cv. sr. unsec. notes     
2 7/8s, 2027  2,700,000  2,392,875 
Live Nation Entertainment, Inc. 144A cv. sr. notes     
2 7/8s, 2027  1,170,000  1,036,913 
Priceline.com, Inc. 144A cv. sr. unsec. notes 1 1/4s,     
2015  1,829,000  2,844,095 
    22,825,196 

 
Communications equipment (1.2%)     
ARRIS Group, Inc. cv. sr. unsec. notes 2s, 2026  3,355,000  3,520,653 
Powerwave Technologies, Inc. cv. sr. unsec. sub. notes     
3 7/8s, 2027  5,121,000  4,788,135 

 



    8,308,788 

 
Computers (3.3%)     
EMC Corp. cv. sr. unsec. notes 1 3/4s, 2013  3,320,000  5,378,400 
EMC Corp. 144A cv. sr. unsec. notes 1 3/4s, 2013  5,800,000  9,396,000 
Quantum Corp. 144A cv. sr. unsec. sub. notes 3 1/2s,     
2015  4,342,000  4,119,255 
TeleCommunication Systems, Inc. 144A cv. sr. unsec.     
notes 4 1/2s, 2014  5,205,000  4,899,987 
    23,793,642 

 
Consumer finance (1.0%)     
Dollar Financial Corp. cv. sr. notes 3s, 2028  6,035,000  7,528,663 
    7,528,663 

 
Consumer services (2.5%)     
Avis Budget Group, Inc. cv. sr. notes 3 1/2s, 2014  2,950,000  3,403,563 
Hertz Global Holdings, Inc. cv. sr. unsec. notes     
5 1/4s, 2014  4,850,000  9,378,688 
WebMD Health Corp. 144A cv. sr. notes 2 1/2s, 2018  5,274,000  5,296,678 
    18,078,929 

 
Containers (0.7%)     
Owens Brockway Glass Container, Inc. 144A cv. company     
guaranty sr. unsec. notes 3s, 2015  4,931,000  5,029,127 
    5,029,127 

 
Electrical equipment (0.6%)     
WESCO International, Inc. cv. company guaranty sr.     
unsec. notes 6s, 2029  1,934,000  4,159,841 
    4,159,841 

 
Electronics (3.8%)     
Advanced Micro Devices, Inc. cv. sr. unsec. notes 6s,     
2015  1,811,000  1,824,583 
EnerSys cv. sr. unsec. notes stepped-coupon 3 3/8s     
(zero %, 6/1/15) 2038 (STP)  2,637,000  2,999,588 
Intel Corp. cv. jr. sub. notes 3 1/4s, 2039  5,955,000  7,212,994 
SanDisk Corp. cv. sr. unsec. notes 1 1/2s, 2017  6,545,000  7,125,869 
TTM Technologies, Inc. cv. sr. unsec. notes 3 1/4s,     
2015  6,300,000  7,843,500 
    27,006,534 

 
Energy (oil field) (0.3%)     
Global Industries, Ltd. 144A cv. unsec. notes 2 3/4s,     
2027  3,000,000  2,302,500 
    2,302,500 

 
Energy (other) (0.5%)     
Covanta Holding Corp. cv. sr. unsec. notes 3 1/4s, 2014  3,000,000  3,525,000 
    3,525,000 

 
Financial (0.8%)     
CapitalSource, Inc. cv. company guaranty sr. unsec.     
sub. notes 7 1/4s, 2037  2,700,000  2,774,250 
Digital Realty Trust LP 144A cv. sr. unsec. notes     
5 1/2s, 2029 (R)  2,300,000  3,195,563 
    5,969,813 

 
Health-care services (2.7%)     
Fisher Scientific International, Inc. cv. company     
guaranty sr. sub. notes 3 1/4s, 2024  3,400,000  4,857,750 
Health Management Associates, Inc. 144A cv. sr. sub.     
notes 3 3/4s, 2028  4,600,000  5,301,500 
LifePoint Hospitals, Inc. cv. sr. sub. notes 3 1/2s,     
2014  3,300,000  3,324,750 
Omnicare, Inc. cv. sr. sub. notes 3 3/4s, 2025  3,310,000  3,806,666 
Providence Service Corp. (The) cv. sr. unsec. sub.     
notes 6 1/2s, 2014  2,493,000  2,468,070 
    19,758,736 

 
Homebuilding (0.6%)     
Lennar Corp. 144A cv. sr. notes 2 3/4s, 2020  3,582,000  4,040,944 
    4,040,944 

 
Insurance (1.3%)     
American Equity Investment Life Holding Co. 144A cv.     
sr. unsec. notes 3 1/2s, 2015  2,369,000  2,804,304 
Old Republic International Corp. cv. sr. unsec. unsub.     
notes 8s, 2012  5,285,000  6,242,906 
    9,047,210 

 
Investment banking/Brokerage (1.2%)     
Ares Capital Corp. 144A cv. sr. unsec. notes 5 3/4s,     
2016  5,016,000  5,160,210 

 



KKR Financial Holdings, LLC cv. sr. unsec. notes     
7 1/2s, 2017  2,600,000  3,659,500 
    8,819,710 

 
Lodging/Tourism (1.0%)     
Host Hotels & Resorts LP 144A cv. company guaranty sr.     
unsec. notes 2 1/2s, 2029 (R)  2,465,000  3,583,494 
Morgans Hotel Group Co. cv. sr. sub. notes 2 3/8s, 2014  4,235,000  3,652,688 
    7,236,182 

 
Manufacturing (1.8%)     
General Cable Corp. cv. unsec. sub. notes     
stepped-coupon 4 1/2s (2 1/4s, 11/15/19) 2029 (STP)  6,580,000  8,208,550 
Teleflex, Inc. cv. sr. unsec. sub. notes 3 7/8s, 2017  4,415,000  4,867,538 
    13,076,088 

 
Media (1.3%)     
Liberty Media, LLC cv. sr. unsec. unsub. notes 3 1/2s,     
2031  10,300,000  5,704,140 
MasTec, Inc. cv. company guaranty sr. unsec. unsub.     
notes 4 1/4s, 2014  2,855,000  3,568,750 
    9,272,890 

 
Medical technology (3.6%)     
China Medical Technologies, Inc. cv. sr. unsec. bonds     
Ser. CMT, 4s, 2013 (China)  4,100,000  3,577,250 
China Medical Technologies, Inc. 144A cv. sr. unsec.     
notes 6 1/4s, 2016 (China)  3,544,000  3,878,465 
Hologic, Inc. cv. sr. unsec. notes stepped-coupon 2s     
(zero %, 12/15/16) 2037 (STP)  5,070,000  5,798,813 
Invitrogen Corp. cv. sr. unsec. unsub. notes 1 1/2s,     
2024  5,900,000  6,991,500 
Medtronic, Inc. cv. sr. unsec. notes 1 5/8s, 2013  3,600,000  3,667,500 
Medtronic, Inc. 144A cv. sr. unsec. notes 1 5/8s, 2013  1,900,000  1,935,625 
    25,849,153 

 
Metals (3.4%)     
Goldcorp, Inc. cv. sr. notes 2s, 2014 (Canada)  5,727,000  6,693,718 
Newmont Mining Corp. cv. company guaranty sr. unsub.     
notes 1 5/8s, 2017  3,900,000  5,269,875 
Steel Dynamics, Inc. cv. sr. notes 5 1/8s, 2014  4,260,000  5,396,888 
U.S. Steel Corp. cv. sr. unsec. notes 4s, 2014  2,820,000  5,446,125 
USEC, Inc. cv. sr. unsec. notes 3s, 2014  2,000,000  1,777,500 

    24,584,106 
 
Oil and gas (2.0%)     
Chesapeake Energy Corp. cv. sr. unsec. notes company     
guaranty 2 1/2s, 2037  9,400,000  8,941,750 
St. Mary Land & Exploration Co. cv. sr. unsec. notes     
3 1/2s, 2027  4,500,000  5,580,000 
    14,521,750 

 
Pharmaceuticals (0.9%)     
Teva Pharmaceutical Finance, LLC cv. company guaranty     
sr. unsec. debs Ser. C, 1/4s, 2026 (Israel)  5,400,000  6,662,250 
    6,662,250 

 
Real estate (0.5%)     
Annaly Capital Management, Inc. cv. sr. unsec. unsub.     
notes 4s, 2015 (R)  3,200,000  3,740,000 
    3,740,000 

 
Retail (0.5%)     
Charming Shoppes, Inc. cv. sr. unsec. notes 1 1/8s,     
2014  4,100,000  3,449,125 
    3,449,125 

 
Semiconductor (0.9%)     
Linear Technology Corp. cv. sr. unsec. unsub. notes     
Ser. A, 3s, 2027  5,775,000  6,251,438 
    6,251,438 

 
Shipping (0.6%)     
Genco Shipping & Trading, Ltd. cv. sr. unsec. notes     
5s, 2015  4,400,000  4,174,500 
    4,174,500 

 
Software (4.1%)     
Microsoft Corp. 144A cv. sr. unsec. notes zero %, 2013  3,961,000  4,253,124 
Rovi Corp. 144A cv. sr. unsec. unsub. notes 2 5/8s,     
2040  4,240,000  6,163,900 
Safeguard Scientifics, Inc. cv. sr. unsec. sub. notes     
10 1/8s, 2014  8,600,000  11,223,000 
SYNNEX Corp. 144A cv. sr. notes 4s, 2018  5,845,000  7,540,050 
    29,180,074 

 



Technology (2.0%)     
CACI International, Inc. cv. sr. unsec. sub. notes     
2 1/8s, 2014  2,100,000  2,464,875 
CACI International, Inc. 144A cv. sr. unsec. sub.     
notes 2 1/8s, 2014  3,720,000  4,366,350 
ON Semiconductor Corp. cv. company guaranty sr. unsec.     
sub. notes 2 5/8s, 2026  785,000  987,138 
ON Semiconductor Corp. 144A cv. company guaranty sr.     
unsec. sub. notes 2 5/8s, 2026  5,300,000  6,664,750 
    14,483,113 

 
Technology services (0.9%)     
CSG Systems International, Inc. 144A cv. sr. unsec.     
sub. notes 3s, 2017  3,138,000  3,220,373 
Salesforce.com, Inc. 144A cv. sr. unsec. unsub. notes     
3/4s, 2015  2,100,000  3,437,070 
    6,657,443 

 
Telecommunications (5.0%)     
Clearwire Communications, LLC/Clearwire Finance, Inc.     
144A cv. company guaranty sr. unsec. notes 8 1/4s, 2040  6,833,000  7,354,358 
Cogent Communication Group, Inc. cv. sr. unsec. notes     
1s, 2027  4,267,000  3,701,623 
Equinix, Inc. cv. sr. unsec. sub. notes 4 3/4s, 2016  6,220,000  8,140,425 
Level 3 Communications, Inc. cv. sr. unsec. unsub.     
notes 6 1/2s, 2016  4,185,000  5,325,413 
Level 3 Communications, Inc. cv. sr. unsec. unsub.     
notes 3 1/2s, 2012  2,940,000  2,906,925 
SBA Communications Corp. cv. sr. unsec. notes 1 7/8s,     
2013  7,410,000  8,382,563 
    35,811,307 

 
Telephone (0.8%)     
Leap Wireless International, Inc. cv. sr. unsec. notes     
4 1/2s, 2014  6,255,000  5,785,875 
    5,785,875 

Total convertible bonds and notes (cost $399,531,807)    $466,699,942 
 
CONVERTIBLE PREFERRED STOCKS (23.8%)(a)     
  Shares  Value 

 
Automotive (2.4%)     
Ford Motor Co. Capital Trust II $3.25 cum. cv. pfd.  99,040  $5,174,840 
General Motors Co. Ser. B, $2.375 cv. pfd.  219,435  11,917,515 
    17,092,355 

 
Banking (4.5%)     
Bank of America Corp. Ser. L, 7.25% cv. pfd.  9,245  9,140,994 
Citigroup, Inc. $7.50 cv. pfd.  75,025  10,315,938 
Huntington Bancshares Ser. A, 8.50% cv. pfd. (S)  3,480  3,921,960 
Wells Fargo & Co. Ser. L, 7.50% cv. pfd.  8,425  8,783,063 
    32,161,955 

 
Combined utilities (1.2%)     
El Paso Corp. 4.99% cv. pfd.  6,715  8,561,625 
    8,561,625 

 
Communications equipment (0.7%)     
Lucent Technologies Capital Trust I 7.75% cv. pfd.  5,860  5,294,510 
    5,294,510 

 
Consumer (1.0%)     
Stanley Black & Decker, Inc. $4.75 cv. pfd.  64,486  7,440,072 
    7,440,072 

 
Consumer goods (0.4%)     
Newell Financial Trust I $2.625 cum. cv. pfd.  58,712  2,524,616 
    2,524,616 

 
Electric utilities (1.6%)     
Great Plains Energy, Inc. $6.00 cv. pfd.  118,674  7,675,834 
PPL Corp. $4.75 cv. pfd.  74,185  3,986,702 
    11,662,536 

 
Financial (0.7%)     
AMG Capital Trust II $2.575 cv. pfd.  129,130  5,358,895 
    5,358,895 

 
Food (1.4%)     
Bunge, Ltd. $4.875 cv. pfd.  43,885  4,262,331 
Dole Food Automatic Exchange 144A 7.00% cv. pfd. (NON)  441,725  5,777,763 
    10,040,094 

 



Insurance (2.6%)     
Assured Guaranty, Ltd. $4.25 cv. pfd. (Bermuda)  49,780  3,080,884 
Hartford Financial Services Group, Inc. (The) $1.182     
cv. pfd. (S)  245,423  6,442,354 
XL Group, Ltd. $2.688 cv. pfd.  295,455  9,342,287 
    18,865,525 

 
Lodging/Tourism (0.1%)     
FelCor Lodging Trust, Inc. Ser. A, $0.488 cum. cv.     
pfd. (R)  18,304  481,624 
    481,624 

 
Media (1.1%)     
Interpublic Group of Cos, Inc. (The) Ser. B, 5.25% cv.     
pfd.  8,165  8,154,794 
    8,154,794 

 
Metals (1.1%)     
Vale Capital II $3.375 cv. pfd. (Cayman Islands)  81,200  7,896,700 
    7,896,700 

 
Miscellaneous (1.1%)     
Nielsen Holdings NV $3.125 cv. pfd.  28,463  1,556,926 
Swift Mandatory Common Exchange Security Trust 144A     
6.00% cv. pfd.  462,160  6,253,025 
    7,809,951 

 
Oil and gas (0.8%)     
Apache Corp. Ser. D, $3.00 cv. pfd.  84,616  5,516,963 
    5,516,963 

 
Power producers (0.4%)     
AES Trust III $3.375 cv. pfd.  59,600  2,894,325 
    2,894,325 

 
Real estate (1.6%)     
Alexandria Real Estate Equities, Inc. Ser. D, $1.75     
cv. pfd.  170,550  4,221,113 
Entertainment Properties Trust Ser. C, $1.438 cum. cv.     
pfd.  388,350  7,611,660 
    11,832,773 

 
Telecommunications (1.1%)     
Crown Castle International Corp. $3.125 cum. cv. pfd.  126,241  7,685,552 
    7,685,552 

Total convertible preferred stocks (cost $147,324,192)    $171,274,865 
 
COMMON STOCKS (6.3%)(a)     
  Shares  Value 

 
Banking (0.9%)     
JPMorgan Chase & Co.  80,350  $3,610,929 
Wells Fargo & Co.  78,700  2,551,454 
    6,162,383 

 
Biotechnology (0.1%)     
Dendreon Corp. (NON)  15,400  539,616 
    539,616 

 
Cable television (0.4%)     
DIRECTV Class A (NON)  76,500  3,242,835 
    3,242,835 

 
Chemicals (0.3%)     
Celanese Corp. Ser. A  49,524  2,054,751 
    2,054,751 

 
Computers (0.5%)     
Hewlett-Packard Co.  78,710  3,596,260 
    3,596,260 

 
Energy (oil field) (0.5%)     
National Oilwell Varco, Inc.  52,445  3,875,686 
    3,875,686 

 
Energy (other) (--%)     
Brazil Ethanol, Inc. 144A (Unit) (NON)  312,500  3,125 
    3,125 

 



Insurance (0.5%)         
Aflac, Inc.      62,300  3,587,234 
        3,587,234 

 
Medical technology (0.5%)         
Medtronic, Inc.      96,500  3,697,880 
        3,697,880 

 
Metals (0.3%)         
Freeport-McMoRan Copper & Gold, Inc. Class B      22,658  2,464,058 
        2,464,058 

 
Oil and gas (0.8%)         
Chevron Corp.      19,135  1,816,486 
Devon Energy Corp.      20,990  1,861,603 
Occidental Petroleum Corp.      19,045  1,841,271 
        5,519,360 

 
Regional Bells (0.5%)         
Verizon Communications, Inc.      96,610  3,441,248 
        3,441,248 

 
Retail (0.5%)         
Bed Bath & Beyond, Inc. (NON)      74,915  3,595,920 
        3,595,920 

 
Telecommunications (0.5%)         
NII Holdings, Inc. (NON)      78,000  3,274,440 
        3,274,440 

Total common stocks (cost $42,647,701)        $45,054,796 
 
CORPORATE BONDS AND NOTES (1.9%)(a)         
      Principal amount  Value 

Affinia Group Inc. 144A company guaranty sr. notes         
11 5/8s, 2015      $1,346,000  $1,386,380 
Affinion Group, Inc. company guaranty sr. unsec. sub.         
notes 11 1/2s, 2015      179,000  186,160 
Clearwire Communications, LLC/Clearwire Finance, Inc.         
144A company guaranty sr. notes 12s, 2015      1,290,000  1,406,100 
Intelsat Luxembourg SA company guaranty sr. unsec.         
notes 11 1/4s, 2017 (Luxembourg)      1,265,000  1,419,963 
Jazz Technologies, Inc. company guaranty sr. unsec.         
notes 8s, 2015 (F)      3,159,000  3,032,640 
Provident Funding Associates 144A sr. notes 10 1/4s,         
2017      1,305,000  1,396,350 
Surgical Care Affiliates, Inc. 144A sr. sub. notes         
10s, 2017      1,320,000  1,362,900 
Swift Services Holdings, Inc. 144A company guaranty         
sr. notes 10s, 2018      1,470,000  1,589,438 
Unisys Corp. 144A company guaranty sr. sub. notes         
14 1/4s, 2015      1,708,000  2,062,410 

Total corporate bonds and notes (cost $12,852,873)        $13,842,341 
 
WARRANTS (--%)(a)(NON)         
  Expiration date  Strike Price  Warrants  Value 

Tower Semiconductor, Ltd. 144A (Israel) (F)  6/30/15  $0.01  1,085,630  $260,551 

Total warrants (cost $217,126)        $260,551 
 
SHORT-TERM INVESTMENTS (1.9%)(a)         
      Shares  Value 

Putnam Cash Collateral Pool, LLC 0.20% (d)      8,206,550  $8,206,550 
Putnam Money Market Liquidity Fund 0.17% (e)      5,100,262  5,100,262 

Total short-term investments (cost $13,306,812)        $13,306,812 
 
TOTAL INVESTMENTS         

Total investments (cost $615,880,511) (b)        $710,439,307 

 



Key to holding's abbreviations

FRN  Floating Rate Notes 

 

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 November 1, 2010 through January 31, 2011 (the reporting period).

(a) Percentages indicated are based on net assets of $718,979,505.

(b) The aggregate identified cost on a tax basis is $615,938,552, resulting in gross unrealized appreciation and depreciation of $102,039,694 and $7,538,939, respectively, or net unrealized appreciation of $94,500,755.

(NON) Non-income-producing security.

(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.

(d) 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 market value of the securities loaned. The market 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. At the close of the reporting period, the value of securities loaned amounted to $8,072,810. The fund received cash collateral of $8,206,550 which is invested in Putnam Cash Collateral Pool, LLC, a limited liability company managed by an affiliate of Putnam Investment Management, LLC (Putnam Management), the fund's manager, an indirect wholly-owned subsidiary of Putnam Investments, LLC. Investments in Putnam Cash Collateral Pool, LLC are valued at its closing net asset value each business day. There are no management fees charged by Putnam Cash Collateral Pool, LLC. The rate quoted in the security description is the annualized 7-day yield at the close fo the reporting period.

(e) The fund invested in Putnam Money Market Liquidity Fund, an open-end management investment company managed by Putnam Management. Investments in Putnam Money Market Liquidity Fund are valued at its closing net asset value each business day. Income distributions earned by the fund are recorded as interest income and totaled $4,525 for the reporting period. During the reporting period, cost of purchases and proceeds of sales of investments in Putnam Money Market Liquidity Fund aggregated $87,314,360 and $84,045,307, respectively. Management fees charged to Putnam Money Market Liquidity Fund have been waived by Putnam Management. The rate quoted in the security description is the annualized 7-day yield of the fund at the close of the reporting period.

(F) Is valued at fair value following procedures approved by the Trustees. Securities may be classified as Level 2 or Level 3 for Accounting Standards Codification ASC 820 Fair Value Measurements and Disclosures (ASC 820) based on the securities' valuation inputs.

(R) Real Estate Investment Trust.

(S) Securities on loan, in part or in entirety, at the close of the reporting period.

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 rates shown on FRN are the current interest rates at the close of the reporting period.

The dates shown on debt obligations are the original maturity dates.

Security valuation: 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. If no sales are reported -- as in the case of some securities traded over-the-counter -- a security is valued at its last reported bid price and is generally categorized as a Level 2 security. Market quotations are not considered to be readily available for certain debt obligations; 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 considers such factors as security prices, yields, maturities and ratings). These securities will generally be categorized as Level 2. Many securities markets and exchanges outside the U.S. close prior to the 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 will generally represent a



transfer from a Level 1 to a Level 2 security, will be classified as Level 2. 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. 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. 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 and recovery rates. These securities are classified as Level 2 or as Level 3 depending on the priority of the significant inputs. 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:       

Basic materials  $4,518,809  $--  $-- 

Communication services  9,958,523  --  -- 

Consumer cyclicals  3,595,920  --  -- 

Energy  9,395,046  3,125  -- 

Financials  9,749,617  --  -- 

Health care  4,237,496  --  -- 

Technology  3,596,260  --  -- 

Total common stocks  45,051,671  3,125  -- 

 
 
 
Convertible bonds and notes  --  466,699,942  -- 

Convertible preferred stocks  --  171,274,865  -- 

Corporate bonds and notes  --  10,809,701  3,032,640 

Warrants  --  --  260,551 

Short-term investments  5,100,262  8,206,550  -- 

Totals by level  $50,151,933  $656,994,183  $3,293,191 

 

At the start and/or close of the reporting period, Level 3 investments in securities were not considered a significant portion of the fund's portfolio.

Market Values 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  Market value    Market value 

Equity contracts  $260,551  $-- 

Total  $260,551  $-- 

 

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 Convertible Securities Fund

By (Signature and Title):

/s/ Janet C. Smith
Janet C. Smith
Principal Accounting Officer
Date: March 31, 2011

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: March 31, 2011

By (Signature and Title):

/s/ Steven D. Krichmar
Steven D. Krichmar
Principal Financial Officer
Date: March 31, 2011