YEARS

EEEEEEEE E E ER RRRRRRRRRR

% C

hang

e in

S&

P 5

00

Ind

ex

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

22%

24%

Federal funds rate

-50%

50%

100%

150%

200%

250%

300%

350%

400%

450%

500%

550%

600%

-100%

Federal funds rate

The interest rate at which private banks lend money for overnight loans. The Fed generally raises the target federal funds rate to slow economic growth, and lowers the rate to facilitate growth.

-15%5

months

-24%4

months

-17%20

months

-14%14

months

-43%21

months

-29%19

months

-16%8

months

-22%6

months

-8%15

months

-14%17

months

33months

87%

19months

60%

14months

39%

43months

90%

118months

526%

29months

59%

61months

281%

27months

86%

30months

76%

26months

52%

91months

407%

26months

94%

56months

100%

-43%30

months

-51%16

months

-7%7

months

Percent change of the S&P 500 Index for each bull and bear market since 1949

37months

76%

’49 ’50 ’51 ’52 ’53 ’54 ’55 ’56 ’57 ’58 ’59 ’60 ’61 ’62 ’63 ’64 ’65 ’66 ’67 ’68 ’69 ’70 ’71 ’72 ’73 ’74 ’75 ’76 ’77 ’78 ’79 ’80 ’81 ’82 ’83 ’84 ’85 ’86 ’87 ’88 ’89 ’90 ’91 ’92 ’93 ’94 ’95 ’96 ’97 ’98 ’99 ’00 ’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14

Sources: National Bureau of Economic Research, Ibbotson Associates, The Federal Reserve Bank of St. Louis, Putnam Investments, 2014. Data is as of 12/31/14, is historical, and reflects reinvested dividends. Past performance and market conditions do not guarantee future results and may not be duplicated. The S&P 500 Index is an unmanaged index of common stock performance. It is not possible to invest directly in an index. Federal funds rate data was not available before July 1954. A bull market is here defined as a period when the stock market rises for at least four straight months. A bear market is defined as a market decline of at least four months.

Stay invested. For long-term investors, staying invested makes more sense than moving in and out of the market at the first sign of bad news. Over the past 66 years, bull markets  have lasted longer (43 months on average) than bear markets (14 months on average) and have more than made up for

the periodic market declines. Bull markets have begun during economic recessions R and expansions E and at all levels of rates . And while it is impossible to predict when a bull market will begin, it is possible to miss one by waiting on the sidelines.

Investor EducationQ4 | 2014

12/31/14

Three reasons to stay the course.

1. The market has always recovered Over the past 66 years, there have been 13 bear

markets, lasting an average of 14 months and

declining a total of 24.6% before recovering.

By contrast, the 14 bull markets since 1949 have

lasted roughly 43 months on balance, each

growing an average of 117.9%.

2. Frequent sellers have lagged the market Industry researcher DALBAR has studied the

effects of frequent buying and selling by mutual

fund investors. The study found that over the

20-year period ended December 31, 2010, stock

fund investors who held shares for an average of

just over 3 years before selling earned substantially

less than the return of the S&P 500 Index (3.8%

versus 9.1%).*

3. Market gains have more than made up for losses Although selling may feel better in times of market

turbulence, the fact is that market gains have more

than made up for losses for those investors who

stay invested over time. A $10,000 investment in

the S&P 500 Index in 1994 would have grown to

$65,475 by December 31, 2014, despite the 51%

downturn of 2008–2009. Please keep in mind

that returns for other periods may have been less

favorable and that other market segments may not

have recovered from this downturn.

* Source: DALBAR, Inc. Quantitative Analysis of Investor Behavior, 2011, for the period ended 12/31/10. Most recent data available.

Investors should carefully consider the investment objectives, risks, charges, and expenses of a fund before investing. For a prospectus, or a summary prospectus if available, containing this and other information for any Putnam fund or product, call your financial representative or call Putnam at 1-800-225-1581. Please read the prospectus

Putnam Retail ManagementPutnam Investments | One Post Office Square | Boston, MA 02109 | putnam.com II620 287184 1/15

BULL MARKETS versus BEAR MARKETS (12/31/48–12/31/14)

Bull Bear

Occurrences 14 13

% of time in economic recessions 48% 52%

% of time in economic expansions 82% 18%

Average length (months) 43 14

Average annual return 23.9% -21.5%

Average cumulative return 117.9% -24.6%

Source: Putnam research. Data illustrated using S&P 500 Index.