Putnam Large Cap Growth Fund’s Strategy for Durable Growth
Investors often demand superior performance to justify higher fees for active management. While outperforming broad stock indexes is challenging and fees can contribute to underperformance, active management can employ strategies to mitigate long-term risk, even with an aggressive growth focus.
The $10.6 billion Putnam Large Cap Growth Fund (PGOYX) showcases successful active management. Co-managed by Richard Bodzy since August 2017 and Greg McCullough since May 2019, this five-star Morningstar-rated fund targets companies with durable business models aligned with industry-wide themes. They invest in “enablers” – companies providing essential tools or services for innovators, ensuring long-term benefits regardless of economic conditions.
The fund’s top holdings include Microsoft Corp. (MSFT) and Nvidia Corp. (NVDA). Both are integral across industries, with Microsoft excelling in cloud applications and corporate services, and Nvidia leading in the GPU market for AI technologies. These giants reflect the fund’s strategy of investing in companies with diverse, durable growth opportunities.
Here are the top 10 holdings of the Putnam Large Cap Growth Fund, along with their allocations in the fund, the iShares Russell 1000 Growth ETF (IWF), and the SPDR S&P 500 ETF Trust (SPY).
The Putnam Large Cap Growth Fund’s Class Y shares, available to institutions or via investment advisers, have outperformed the S&P 500 over the long term despite higher fees. Bodzy and McCullough emphasize investing in innovative, structurally advantaged companies to guard against uncertainty, positioning the fund to benefit if market trends shift.
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