Putnam unveils three ‘alternative’ mutual funds
Putnam Investments plans to introduce three new alternative types of mutual funds that will be managed by PanAgora Asset Management, a Boston firm that typically manages money for institutions and is majority-owned by Putnam.
The new funds include one aimed at investing money under “varying economic conditions,” and another that’s market neutral — or long/short fund — meaning the managers buy stocks they believe will rise, and bet against others they think will fall.
The third is a managed futures fund, which will use derivatives, or investments linked to the movements of other securities.
All three funds fall under the heading of so-called liquid alternatives — investments that aim to make money in certain market conditions, and to hedge against performance in vanilla stock or bond funds.
“They’re obviously fairly sophisticated instruments,’’ said Scott C. Sipple, head of Global Investment Strategies at Putnam.
“We’re responding to what we think the marketplace needs,’’ Sipple said.
It’s also what Putnam executives believe they need to do to attract investors. The announcement is the latest in a series of moves the firm, with $162 billion under management, has made to shake up its investment offerings at a time when customers across the industry have been flocking to cheaper index funds.
Putnam in recent months has beefed up its small-stock investing team, hired a head of sustainable investing and promoted three new investment chiefs. The company in November said it would cut costs by eliminating 115 jobs, or 8 percent of its work force.
PanAgora manages $48 billion in assets, according to Putnam.