Putnam Investments
100 Federal Street
Boston, MA 02110
December 29, 2020
Securities and Exchange Commission 100 F Street, NE Washington, DC 20549 Attn: Patrick Scott |
| Re: | Comments on Post-Effective Amendment No. 45 under the Securities Act of 1933, as amended (the “Securities Act”), and Amendment No. 46 under the Investment Company Act of 1940, as amended (the “Investment Company Act”), to the Registration Statement on Form N-1A (File Nos. 333-117134 and 811-21598) (the “Registration Statement”) of Putnam Target Date Funds (formerly “Putnam RetirementReady Funds”) (the “Registrant”), filed with the Securities and Exchange Commission (the “Commission”) on December 11, 2020 (the “485(a) Amendment”), with respect to its series Putnam RetirementReady 2060 Fund, Putnam RetirementReady 2055 Fund, Putnam RetirementReady 2050 Fund, Putnam RetirementReady 2045 Fund, Putnam RetirementReady 2040 Fund, Putnam RetirementReady 2035 Fund, Putnam RetirementReady 2030 Fund, Putnam RetirementReady 2025 Fund, and Putnam RetirementReady Maturity Fund (each, a “Fund” and, collectively, the “Funds”) |
Dear Mr. Scott:
This letter responds to the comments that you provided telephonically to Peter Fariel of Putnam Investment Management, LLC (“Putnam Management”), investment adviser to the Funds, on behalf of the Staff of the Commission (the “Commission Staff”) on December 23, 2020 regarding the 485(a) Amendment. For convenience of reference, I have summarized the Commission Staff’s comments before the Registrant’s responses. These responses will be reflected in Post-Effective Amendment No. 47 under the Securities Act and Amendment No. 48 under the Investment Company Act to the Registration Statement, filed with the Commission on or around January 4, 2021 (the “485(b) Amendment”). References to page numbers or specific text in the Commission Staff’s comments and the Registrant’s responses are to the corresponding page numbers and text of the 485(a) Amendment, as indicated.
General Comment
| 1. | Comment: Please respond to all comments via correspondence on EDGAR. Please finalize the Registration Statement filed with the 485(b) Amendment with all brackets removed and all material information provided. If a comment results in a change to the disclosure |
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language, please include the revised disclosure in the letter. The Commission Staff notes that the Registrant is responsible for the adequacy and accuracy of the Registration Statement.
Response: The Registrant confirms that it is responding to all comments via this correspondence on EDGAR. The Registrant also confirms that it will revise the Registration Statement filed with the 485(b) Amendment to remove all brackets and to provide all material information. The Registrant further confirms that if a comment results in a change to the disclosure language it will include the revised disclosure in this letter. The Registrant acknowledges that the Registrant is responsible for the adequacy and accuracy of the Registration Statement.
| Prospectus |
Fund summaries – Investments
| 2. | Comment: Under the heading “Investments” in each Fund’s Fund Summary, in the table showing the Funds’ approximate allocations to each asset class and underlying fund, please make the allocations of the particular Fund to which the Fund Summary relates more prominent than the allocations of each other Fund. |
Response: The Registrant has included the caption “your fund” in the column header of the above-referenced table to identify the particular Fund to which the Fund Summary relates. The Registrant also has used bold font for the column showing that Fund’s allocations. The Registrant believes that this approach is appropriate to make the relevant Fund’s allocations more prominent than those of each other Fund.
Fund summaries – Risks
| 3. | Comment: Please consider adding a heading for each risk factor discussed under the heading “Risks” in each Fund’s Fund Summary in light of the plain English requirements of Rule 421(d) under the Securities Act. |
Response: The Registrant respectfully declines to make this change. The Registrant believes that the Funds’ narrative risk disclosure provided under the heading “Risks” in each Fund’s Fund Summary is appropriate in light of the requirements of Item 4(b)(1) of Form N-1A and the plain English requirements of Rule 421 under the Securities Act.
| 4. | Comment: Please review the risk disclosure relating to derivatives and confirm that the discussion appropriately reflects the specific types of derivative instruments each underlying fund is expected to make as part of its principal investment strategies and the risks associated with investments in those instruments. |
Response: The risk disclosure relating to derivatives will be revised as follows in connection with the 485(b) Amendment (new language denoted by underline and deleted language denoted bystrike-through):
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Each underlying fund, except Putnam Government Money Market Fund, may use derivatives, such as futures, options, certain foreign currency transactions, warrants and swap contracts, for both hedging and investment purposes. Putnam Fixed Income Absolute Return Fund and Putnam Multi-Asset Absolute Return Fund intend to use derivatives to increase investment exposure, which is an important component of the funds’ investment strategies. An underlying fund’s use of leverage obtained throughUnderlying funds that use derivativesincreases the risk of investing in the underlying fund by increasingto increase investment exposure are riskier than underlying funds that do not employ investment leverage. The value of derivatives may move in unexpected ways and may result in increased volatility. Derivatives also involve the risk, in the case of many over-the-counter instruments,of the potential inability that an underlying fund may be unable to terminate or sell derivatives positions when it wants to and that the potential failure ofthe other party to the instrument may fail to meet its obligations.
The Registrant believes that the disclosure, as revised, appropriately reflects the specific types of instruments each underlying fund is expected to make as part of its principal investment strategies and the risks associated with investments in those instruments.
| 5. | Comment: Please confirm that there are not redundant references in the prospectus to the risk that each Fund may not achieve its goal. |
Response: The Registrant has confirmed that there are not redundant references in the prospectus to the risk that each Fund may not achieve its goal. This risk is referenced once with respect to each Fund in that Fund’s Fund Summary, and the remaining references (which appear in the section “What are the funds’ and each underlying fund’s main investment strategies and related risks?”) relate to the risks of investing in the underlying funds.
Who oversees and manages the fund?
| 6. | Comment: The fourth paragraph under the heading “The fund’s investment manager” states that Putnam Investment Management, LLC (“Putnam Management”) has retained its affiliate Putnam Investments Limited (“PIL”) to make investment decisions for such fund assets as may be designated for its management by Putnam Management from time to time but that PIL is not currently managing any fund assets. Please confirm supplementally whether, before any fund assets are designated for PIL’s management by Putnam Management, the Registrant will supplement the Funds’ prospectus to reflect that designation. |
Response: The Registrant confirms that, before any fund assets are designated for PIL’s management by Putnam Management, the Registrant will supplement the Funds’ prospectus to reflect that designation.
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I believe this letter addresses the Commission Staff’s comments. Should you have any further questions, please do not hesitate to call me at (617) 760-0023. Thank you for your assistance.
Very truly yours,
/s/ Peter Fariel
Peter Fariel
Associate General Counsel
Putnam Investments
cc: James E. Thomas, Esq., Ropes & Gray LLP
James M. Forbes, Esq., Ropes & Gray LLP