March - Putnam Investments

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Terms and definitionsImportant termsTotal return shows how the value of the fund’sshares changed over time, assuming you held theshares through the entire period and reinvestedall distributions in the fund.Before sales charge, or net asset value, is theprice, or value, of one share of a mutual fund,without a sales charge. Before-sales-chargefigures fluctuate with market conditions, andare calculated by dividing the net assets of eachclass of shares by the number of outstandingshares in the class.After sales charge is the price of a mutual fundshare plus the maximum sales charge leviedat the time of purchase. After-sales-chargeperformance figures shown here assume the5.75% maximum sales charge for class A sharesand 3.50% for class M shares.Contingent deferred sales charge (CDSC) isgenerally a charge applied at the time of theredemption of class B or C shares and assumesredemption at the end of the period. Your fund’sclass B CDSC declines over time from a 5%maximum during the first year to 1% during thesixth year. After the sixth year, the CDSC no longerapplies. The CDSC for class C shares is 1% for oneyear after purchase.Share classesClass A shares are generally subject to an initialsales charge and no CDSC (except on certainredemptions of shares bought without an initialsales charge).Class B shares are not subject to an initial salescharge. They may be subject to a CDSC.Class C shares are not subject to an initial salescharge and are subject to a CDSC only if theshares are redeemed during the first year.Class M shares have a lower initial sales chargeand a higher 12b-1 fee than class A shares and noCDSC (except on certain redemptions of sharesbought without an initial sales charge).Class R shares are not subject to an initial salescharge or CDSC and are available only to certainemployer-sponsored retirement plans.Class R5 shares and class R6 shares are notsubject to an initial sales charge or CDSC, andcarry no 12b-1 fee. They are only available tocertain employer-sponsored retirement plans.Class Y shares are not subject to an initialsales charge or CDSC, and carry no 12b-1 fee.They are generally only available to corporateand institutional clients and clients in otherapproved programs.Fixed-income termsCurrent yield is the annual rate of return earnedfrom dividends or interest of an investment.Current yield is expressed as a percentageof the price of a security, fund share, orprincipal investment.Mortgage-backed security (MBS), also knownas a mortgage “pass-through”, is a type of assetbackedsecurity that is secured by a mortgage orcollection of mortgages. The following are typesof MBSs:• Agency “pass-through” has its principal andinterest backed by a U.S. government agency, suchas the Federal National Mortgage Association(Fannie Mae), Government National MortgageAssociation (Ginnie Mae), and Federal Home LoanMortgage Corporation (Freddie Mac).• Collateralized mortgage obligation (CMO)represents claims to specific cash flows frompools of home mortgages. The streamsof principal and interest payments on themortgages are distributed to the different classesof CMO interests in “tranches”. Each tranche mayhave different principal balances, coupon rates,prepayment risks, and maturity dates. A CMOis highly sensitive to changes in interest ratesand any resulting change in the rate at whichhomeowners sell their properties, refinance, orotherwise prepay loans. CMOs are subject toprepayment, market, and liquidity risks.• Interest-only (IO) security is a type of CMO inwhich the underlying asset is the interest portionof mortgage, Treasury, or bond payments.• Non-agency residential mortgage-backedsecurity (RMBS) is an MBS not backed by FannieMae, Ginnie Mae, or Freddie Mac. One type ofRMBS is an Alt-A mortgage-backed security.• Commercial mortgage-backed security(CMBS) is secured by the loan on acommercial property.Yield curve is a graph that plots the yields ofbonds with equal credit quality against theirdiffering maturity dates, ranging from shortest tolongest. It is used as a benchmark for other debt,such as mortgage or bank lending rates.Dynamic Asset Allocation Growth Fund 15
Comparative indexesBarclays U.S. Aggregate Bond Index is anunmanaged index of U.S. investment-gradefixed-income securities.BofA (Bank of America) Merrill Lynch U.S.3-Month Treasury Bill Index is an unmanagedindex that seeks to measure the performance ofU.S. Treasury bills available in the marketplace.Putnam Growth Blended Benchmark isa benchmark administered by PutnamManagement, comprising 60% the Russell 3000Index, 15% the MSCI EAFE Index (ND), 15% theBarclays U.S. Aggregate Bond Index, 5% theJPMorgan Developed High Yield Index, and 5%the MSCI Emerging Markets Index (ND).Russell 3000 Index is an unmanaged index of the3,000 largest U.S. companies.S&P 500 Index is an unmanaged index ofcommon stock performance.Indexes assume reinvestment of all distributions and donot account for fees. Securities and performance of afund and an index will differ. You cannot invest directlyin an index.Lipper is a third-party industry-ranking entitythat ranks mutual funds. Its rankings do notreflect sales charges. Lipper rankings are basedon total return at net asset value relative to otherfunds that have similar current investment stylesor objectives as determined by Lipper. Lippermay change a fund’s category assignment atits discretion. Lipper category averages reflectperformance trends for funds within a category.Other information for shareholdersImportant notice regarding deliveryof shareholder documentsIn accordance with Securities and ExchangeCommission (SEC) regulations, Putnam sends asingle copy of annual and semiannual shareholderreports, prospectuses, and proxy statementsto Putnam shareholders who share the sameaddress, unless a shareholder requests otherwise.If you prefer to receive your own copy of thesedocuments, please call Putnam at 1-800-225-1581,and Putnam will begin sending individual copieswithin 30 days.Proxy votingPutnam is committed to managing our mutualfunds in the best interests of our shareholders.The Putnam funds’ proxy voting guidelines andprocedures, as well as information regardinghow your fund voted proxies relating to portfoliosecurities during the 12-month period endedJune 30, 2013, are available in the IndividualInvestors section of putnam.com, and on theSEC’s website, www.sec.gov. If you have questionsabout finding forms on the SEC’s website, youmay call the SEC at 1-800-SEC-0330. You mayalso obtain the Putnam funds’ proxy votingguidelines and procedures at no charge by callingPutnam’s Shareholder Services at 1-800-225-1581.Fund portfolio holdingsThe fund will file a complete schedule of itsportfolio holdings with the SEC for the first andthird quarters of each fiscal year on Form N-Q.Shareholders may obtain the fund’s Forms N-Q onthe SEC’s website at www.sec.gov. In addition, thefund’s Forms N-Q may be reviewed and copied atthe SEC’s Public Reference Room in Washington,D.C. You may call the SEC at 1-800-SEC-0330for information about the SEC’s website or theoperation of the Public Reference Room.Trustee and employeefund ownershipPutnam employees and members of the Boardof Trustees place their faith, confidence, and,most importantly, investment dollars in Putnammutual funds. As of March 31, 2014, Putnamemployees had approximately $461,000,000 andthe Trustees had approximately $109,000,000invested in Putnam mutual funds. These amountsinclude investments by the Trustees’ andemployees’ immediate family members as wellas investments through retirement and deferredcompensation plans.16 Dynamic Asset Allocation Growth Fund
Page 2 and 3: Putnam DynamicAsset AllocationGrowt
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Page 6 and 7: Interview withyour fund’sportfoli
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Page 12 and 13: Your fund’s performanceThis secti
Page 14 and 15: Your fund’s expensesAs a mutual f
Page 18 and 19: Trustee approval of management cont
Page 20 and 21: necessary or desirable for the comi
Page 22 and 23: fees and total expenses (excluding
Page 24 and 25: of their Brokerage Committee and al
Page 26 and 27: The fund’s portfolio 3/31/14 (Una
Page 28 and 29: COMMON STOCKS (60.9%)* cont. Shares
Page 46 and 47: CORPORATE BONDS AND NOTES (13.9%)*
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CORPORATE BONDS AND NOTES (13.9%)*
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MORTGAGE-BACKED SECURITIES (2.8%)*
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MORTGAGE-BACKED SECURITIES (2.8%)*
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FOREIGN GOVERNMENT AND AGENCYBONDS
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Key to holding’s currency abbrevi
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FORWARD CURRENCY CONTRACTS at 3/31/
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FORWARD CURRENCY CONTRACTS at 3/31/
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CENTRALLY CLEARED INTEREST RATE SWA
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OTC TOTAL RETURN SWAP CONTRACTS OUT
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OTC CREDIT DEFAULT CONTRACTS OUTSTA
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Valuation inputsOther financial ins
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Statement of assets and liabilities
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Statement of changes in net assetsI
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Financial highlights (Continued)Rat
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securities under Accounting Standar
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Futures contracts are valued at the
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the other party may elect to termin
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Note 2: Management fee, administrat
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Note 3: Purchases and sales of secu
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At the close of the reporting perio
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The following is a summary of reali
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Shareholder meeting results (Unaudi
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Absolute ReturnAbsolute Return 100
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Putnam’s commitmentto confidentia
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This report is for the information
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March - Putnam Investments

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