Putnam U.S. Research Fund - Class R6 · NASDAQ:PLJMX
Putnam U.S. Research Fund - Class R6 — Putnam Investments — Investor Presentation (May 2023)
27 slides from Putnam U.S. Research Fund - Class R6's investor presentation, May 2023
Slide 1: Putnam Closed-End Funds Update: PIM and PPT
Putnam Closed-End Funds Update: Putnam Master Intermediate Income Trust (PIM) and Putnam Premier Income Trust (PPT) Q1 | 2023 Not FDIC May Lose No Bank AD 2874754 4/23 Insured Value Guarantee
Slide 2: Putnam Closed-End Funds Update: Presenters
Putnam Closed-End Funds Update: Putnam Master Intermediate Income Trust (PIM) and Putnam Premier Income Trust (PPT) Q1 | 2023 Albert Chan, CFA Kelly M. Loughran, CFA Head of Portfolio Construction Investment Product Analyst, Fixed Income AD 2874754 4/23 2
Slide 3: Agenda
Agenda • Macro overview • Investment process • Fund performance and positioning AD 2874754 4/23 3
Slide 4: Macro themes
Macro themes Global growth has been slowing and recession risks are rising – Global growth estimates and investor sentiment have adjusted lower, while data has weakened somewhat. Lower realized growth and growth expectations are a reflection of central bank tightening, soaring inflation, supply-side
Slide 5: 2022 and Q1 2023 market performance across fixed income
2022 and Q1 2023 market performance across fixed income Key rate/spread levels 12/31/21 12/31/22 3/31/23 2022 Change QTD Change 2-year Treasury 0.73% 4.43% 4.03% +370 bps -40 bps 10-year Treasury 1.51% 3.88% 3.47% +237 bps -41 bps Bloomberg 1-3 yr. Corp Index OAS +42 bps +73 bps +101 bps +31 bps +28
Slide 6: Excess yield over Treasuries (OAS)
We believe attractive opportunities exist outside of the index • Specialized research is required to navigate less efficient and potentially higher risk markets • We incorporate expected losses into our return expectations to identify relative value In the index Outside the index Highly liquid and t
Slide 7: Sectors with attractive liquidity premiums also provide diversification
Sectors with attractive liquidity premiums also provide diversification • Securitized sectors have historically exhibited low correlations to corporate assets • Low correlations between securitized sectors due to various balance sheets and structures Correlations of monthly duration hedged excess r
Slide 8: Share of refinanceable borrowers will take time to grow
Share of refinanceable borrowers will take time to grow • Morgan Stanley Truly Refinanceable Index measures the % of the universe that has at least a 25bp interest rate incentive after taking into account a variety of fees. High: 91.1% 100 90 80 70 60 Percent 50 40 30 20 Low: 0.0% 10 0 MBSTRIT Sourc
Slide 9: Annualized performance: Master Intermediate Income Trust
Annualized performance (fund shares) as of March 31, 2023 Portfolio: Master Intermediate Income Trust Benchmark: ICE BofA U.S. Treasury Bill Index Portfolio Benchmark 2.49 1.59 1.74 1.42 1.12 0.86 0.88 Return (%) 0.17 -0.28 -1.95 Q1 1 year 3 years 5 years 10 years Relative performance (%): Portfolio
Slide 10: Annualized performance: Premier Income Trust
Annualized performance (fund shares) as of March 31, 2023 Portfolio: Premier Income Trust Benchmark: ICE BofA U.S. Treasury Bill Index Portfolio Benchmark 2.49 2.42 2.11 1.42 Return (%) 1.12 0.86 0.88 0.46 0.07 -1.31 Q1 1 year 3 years 5 years 10 years Relative performance (%): Portfolio versus bench
Slide 11: Our investor website has resources for you
Our investor website has resources for you putnam.com/individual • Perspectives • Daily updates on performance and pricing • PM videos AD 2874754 4/23 11
Slide 12: Risk disclosures
For informational purposes only. Not an investment recommendation. Duration measures the sensitivity of bond prices to interest-rate changes. A negative duration indicates that a security of fund may be poised to increase in value when interest rates increase. Consider these risks before investing:
Slide 13: Putnam Closed-End Funds Update: PMM and PMO
Putnam Closed-End Funds Update: PMM and PMO Q1 | 2023 Not FDIC May Lose No Bank AD 2874754 4/23 Insured Value Guarantee
Slide 14: Putnam Closed-End Funds Update: Presenters
Putnam Closed-End Funds Update: PMM and PMO Q1 | 2023 Paul M. Drury, CFA Kelly M. Loughran, CFA Portfolio Manager Investment Product Analyst, Fixed Income AD 2874754 4/23 14
Slide 15: Agenda
Agenda • Review current market outlook • Discuss PMO and PMM portfolio positioning • Share insights into performance AD 2874754 4/23 15
Slide 16: Municipal market overview
Municipal market overview We believe municipal bonds are a valuable part of a diversified portfolio and important for long -term investors in need of tax-free income, but municipal bonds are not immune to bouts of volatility. Fundamentals Technicals Valuation • Fundamentals continue to be generally
Slide 17: Reserves will help support states in a recession
Based on S&P analysis, reserves will help support states in a recession • Balances in rainy day funds hit all-time highs in 37 states by the end of 2022, and overall, they are near their highest point in 30 years at 12% of spending 2023 Reserves Under Base Case Stress Scenario as % of Projected Expe
Slide 18: Municipal bond default rates remain a small percentage of the market
Municipal bond default rates remain a small percentage of the overall market There were zero defaults in March 2023, and that was only the 2nd month since 2009 with no defaults Muni bond defaults as a % of Municipal market 0.50% 0.40% 0.30% 69 64 0.20% 0.10% 40 55 85 57 70 64 62 43 8 0.00% 2013 2014
Slide 19: Muni market outflows have moderated in 2023
While outflows dominated the muni market in 2022, outflows have moderated in 2023 and remain manageable All municipal fund flows ($) 20,000,000 10,000,000 0 2018 Fed Cycle -10,000,000 Meredith Whitney Taper tantrum Election uncertainty -20,000,000 Current Fed Cycle Covid-19 -30,000,000 Municipal out
Slide 20: New money and refunding supply are down year-over-year
New money supply and refunding supply are down year-over-year as both muni and Treasury rates have risen New money supply Refunding supply $350 $200 $180 $300 $160 $250 $140 $120 $200 Millions ($) Millions ($) $100 $150 $80 $100 $60 $40 $50 $20 $0 $0 *YTD. Source: Bond Buyer, as of 3/31/23. AD 28747
Slide 21: Investment-grade credit spreads look more attractive than high-yield
Compared to historical averages, investment-grade credit spreads look more attractive than deep high-yield spreads 500 Current spread Historical 5-year average spread 450 400 350 325 304 300 257 250 200 188 160 150 109 100 85 48 50 0 A BBB BB NR Tax-Exempt Credit Spreads (5-year) A BBB BB NR Current
Slide 22: Muni Taxable Equivalent Yield reached its highest point in 10 years
Muni Taxable Equivalent Yield (TEY) reached its highest point in the last 10 years during this rates driven sell-off last year 8.00 Muni TEY peaked at 7.13% in 7.00 October 2022 and is currently at Taper tantrum & 5.69% Puerto Rico sell off Covid-19 6.00 Muni TEY % at 40.8% tax rate 5.00 4.00 3.00 2
Slide 23: Annualized performance: Municipal Opportunities Trust
Annualized performance (fund shares) as of March 31, 2023 Portfolio: Municipal Opportunities Trust Benchmark: Bloomberg Municipal Bond Index Portfolio Benchmark 4.14 3.47 2.78 2.13 2.03 2.38 Return (%) 0.26 0.42 0.35 -3.82 Q1 1 year 3 years 5 years 10 years Relative performance (%): Portfolio versus
Slide 24: Annualized performance: Managed Municipal Income Trust
Annualized performance (fund shares) as of March 31, 2023 Portfolio: Managed Municipal Income Trust Benchmark: Bloomberg Municipal Bond Index Portfolio Benchmark 4.02 2.78 3.20 2.03 2.38 1.38 Return (%) 0.26 0.42 0.35 -6.42 Q1 1 year 3 years 5 years 10 years Relative performance (%): Portfolio versu
Slide 25: Our investor website has resources for you
Our investor website has resources for you putnam.com/individual • Perspectives • Daily updates on performance and pricing • PM videos AD 2874754 4/23 25
Slide 26: Risk disclosures
For informational purposes only. Not an investment recommendation. Consider these risks before investing: Lower-rated bonds may offer higher yields in return for more risk. Bond investments are subject to interest-rate risk (the risk of bond prices falling if interest rates rise) and credit risk (th
Slide 27: Putnam Investments logo
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