Putnam to launch guaranteed fund early next year

Putnam Investments is planning to launch a mutual fund with a guarantee in the first quarter of next year. The company also is discussing developing a mutual fund that would use a combination of absolute-return strategies with puts and calls to provide investors with a lifetime income stream, Robert Reynolds, Putnam’s president and chief executive, said in an interview. “It’s not a guarantee,” he said. “But a guarantee in any shape or form depends on the economic viability of the wrapper.” Putnam is discussing launching both products for the defined-contribution space as well as for the individual retirement account rollover market, Mr. Reynolds noted. For the guaranteed mutual fund, Putnam is in discussions with a number of insurers — including its sister company, Great-West Life and Annuity Insurance Co. — but hasn’t yet decided which carrier it will use. The firm is discussing adding the annuity feature to one of its target date funds so that investors could receive a lifetime income stream, Mr. Reynolds said.