50141 2/99
PROSPECTUS SUPPLEMENT
dated February 5, 1999 to:
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PUTNAM HIGH YIELD TOTAL RETURN FUND
Prospectus dated October 30, 1998
PROPOSED MERGER OF FUND
The Trustees of Putnam High Yield Total Return Fund (the "fund"),
have approved in principle the merger of the fund into Putnam
High Yield Trust II ("High Yield II"). Under the proposal the
fund's assets would be transferred to High Yield II in return for
shares of High Yield II with equal total net asset value. These
High Yield II shares would be distributed pro rata to
shareholders of the fund. Current fund shareholders would become
shareholders of High Yield II and receive shares of High Yield II
with an equal net asset value to shares of the fund at the time
of the merger.
The proposed merger is still subject to definitive approval by
the Trustees of the fund and approval by shareholders at a
shareholders' meeting expected to be held in July. No assurance
can be given that the merger will occur.
The investment objective of High Yield II is to seek high current
income. Capital growth is a secondary objective when consistent
with the primary objective of high current income. High Yield
Trust II invests primarily (at least 80%) in lower, rated fixed
income securities, including debt instruments, nonconvertible
preferred stock and convertible securities. High Yield II is
similar in investment policies to the fund except that it places
more emphasis on current yield, rather than total return, than
the fund.
If the Trustees approve definitive arrangements concerning the
merger, a full description of High Yield II and the terms of the
proposed merger will be contained in proxy materials to be mailed
to shareholders of the fund later this year.
In light of the proposal, sales of fund shares to new investors
are expected to be suspended on or about February 26, 1999
although then existing investors will be permitted to make
additional investments after that date.
