Putnam slashes sales charge, broker payout on three funds

In a bid to ease investors out of cash and back into the market, Putnam Investments is dropping the sales charge and broker payout on the Class A and Class M shares of three of its mutual funds.
JUN 14, 2010
In a bid to ease investors out of cash and back into the market, Putnam Investments is dropping the sales charge and broker payout on the Class A and Class M shares of three of its mutual funds. Starting April 5, Putnam is reducing to 1%, from 3.25%, the sales charge on all purchases of Class A shares of its Putnam Floating Rate Income Fund, Putnam Absolute Return 100 Fund and Putnam Absolute Return 300 Fund. Putnam is also reducing the sales charge on Class M shares of the three funds to 0.75%, from 2%. Additionally, Putnam is lowering the investment minimum at which investors can buy its fixed-income and absolute-return funds at net asset value to $500,000, from $1 million. Putnam is lowering the minimum investment and the sales charges to help advisers encourage investors to get back into the market, said Elaine Sullivan, managing director, head of retail marketing. “It seems like there are a lot of investors who continue to have money in cash,” she said. The reduced sales charges are intended to make them more competitive with other short-term-bond funds in the marketplace, Ms. Sullivan said. As a result of the lower charges, broker payouts for the Class A shares of the funds will drop to 1% upfront, from 3%. Broker payouts on the Class M shares will decrease to 0.75%, from 1%. Commission-based advisers may be reluctant to sell these funds, however, since they’ll be getting paid less upfront, said Scott Smith, associate director at Cerulli Associates Inc. “It seems like a good [public-relations] move to make the funds more accessible at a lower price, but I am not sure that advisers will embrace it,” Mr. Smith said. But Putnam believes that advisers will do what is in the best interests of their clients, Ms. Sullivan said. “If an adviser feels this kind of pricing arrangement meets their clients’ needs more than other pricing arrangements, then it will work for all parties,” Ms. Sullivan said.

Latest News

Raymond James, Osaic laud new bank partnerships
Raymond James, Osaic laud new bank partnerships

A Texas-based bank selects Raymond James for a $605 million program, while an OSJ with Osaic lures a storied institution in Ohio from LPL.

Bessent backpedals after blowback on 'privatizing Social Security' comments
Bessent backpedals after blowback on 'privatizing Social Security' comments

The Treasury Secretary's suggestion that Trump Savings Accounts could be used as a "backdoor" drew sharp criticisms from AARP and Democratic lawmakers.

Alternative investment winners and losers in wake of OBBBA
Alternative investment winners and losers in wake of OBBBA

Changes in legislation or additional laws historically have created opportunities for the alternative investment marketplace to expand.

Financial advisors often see clients seeking to retire early; Here's what they tell them
Financial advisors often see clients seeking to retire early; Here's what they tell them

Wealth managers highlight strategies for clients trying to retire before 65 without running out of money.

Robinhood beats Q2 profit estimates as business goes beyond YOLO trading
Robinhood beats Q2 profit estimates as business goes beyond YOLO trading

Shares of the online brokerage jumped as it reported a surge in trading, counting crypto transactions, though analysts remained largely unmoved.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.