Putnam Investments to Bolster Small Cap Equity Investment Capabilities

BOSTON, March 21, 2017Putnam Investments announced today that the firm will be taking a series of steps to reshape its global small cap equity team and product strategy, designed to seize opportunity in an area where the company believes active management will offer a competitive edge, both in today’s marketplace and in the years to come.

Putnam will be adding investment talent and expanding the research team in the small cap equity space, as well as pursuing a more concentrated focus on fundamental research to identify and capitalize on investment ideas across the small company universe.

Among the most significant developments, David Diamond, a well-respected value investor, has joined the firm and will become co-portfolio manager of Putnam Small Cap Value Fund, effective March 31, 2017. Diamond is best known for his small cap value approach as the founder of Boston-based High Rock Capital and as a senior portfolio manager with The Boston Company. In his new role at Putnam, Diamond will work closely with co-manager Eric Harthun, who will be retiring from Putnam at the end of 2017.

Aaron Cooper
Aaron Cooper

“The global small cap equity universe offers many interesting opportunities for an active manager who fully utilizes fundamental research,” said Aaron Cooper, Chief Investment Officer, Equities, Putnam Investments. “We are making a number of moves to further enhance Putnam’s investment capabilities in the small cap equity area, which we think has the potential to be a real bright spot for the firm and our clients.

“A key component in this effort is the addition of David Diamond, a talented investor with a strong value discipline in the small cap arena, who joins forces with Putnam’s existing portfolio management and equity research team, to drive results in this important market segment,” added Cooper. “Over the course of 2017, David will be working closely with Eric Harthun, who has helped to build a solid foundation for Putnam Small Cap Value Fund and has been a strong contributor in numerous ways since joining the firm in 2000.”

Other notable changes to the Putnam small cap equity line up include the following:

  • The firm will be expanding its small cap equity research team with the hiring of Bill Wiese as a small cap value analyst, bringing the small cap research team — which seeks to gain extensive on-the-ground, fundamental insight on small companies — to a total of eight analysts. Wiese brings deep small cap expertise, having worked closely with David Diamond at both The Boston Company and High Rock Capital.
  • While fundamental research has been an important driver of security selection for Putnam for many years, the firm believes that it takes on even greater importance in the small cap equity space and will play an increasingly significant role within these portfolios. In particular, Putnam Capital Opportunities Fund will be managed by members of the small cap research team, led by Co-Director of Equity Research Kate Lakin. The current portfolio manager, Pam Gao, will be leaving the firm at the end of March 2017.
  • Bill Monroe, a Putnam veteran with a background as a diversified analyst across sectors, will assume management of Putnam Small Cap Growth Fund effective March 31, 2017, replacing Pam Gao.
  • Putnam International Capital Opportunities Fund will be managed by Karan Sodhi, Spencer Morgan and Andrew Yoon, three experienced Putnam equity analysts, who will take the reins from members of the firm’s global asset allocation team, effective March 31, 2017.
  • It is anticipated that three of Putnam’s primary small cap equity mutual fund portfolios (Putnam Small Cap Growth Fund, Putnam Capital Opportunities Fund and Putnam International Capital Opportunities Fund) will be managed with a reduced number of overall holdings to enhance their exposure to securities identified as strong potential drivers of alpha.

“Putnam has great confidence in the team and approach that has been put in place in the small cap equity area to mine compelling long-term investment opportunities around the globe,” added Cooper.

About Putnam Investments

Founded in 1937, Putnam Investments is a global money management firm with nearly 80 years of investment experience. At the end of February 2017, Putnam had $160 billion in assets under management. Putnam has offices in Boston, London, Frankfurt, Tokyo, Singapore and Sydney. For more information, visit putnam.com.