PUTNAM HIGH YIELD ADVANTAGE FUND PROSPECTUS ATTACHMENT
This prospectus explains what you should know before investing in
shares of Putnam High Yield Advantage Fund. Please read it
carefully and keep it for future reference.
EXPENSE SUMMARY
Expenses are one of several factors to consider when investing.
The following table summarizes your maximum transaction costs
from investing in class M shares of the Fund and expenses
incurred in respect of class M shares in the most recent fiscal
year. The example shows the cumulative expenses attributable to
a hypothetical $1,000 investment in class M shares over the
specified periods.
SHAREHOLDER TRANSACTION EXPENSES
Maximum sales charge imposed
on purchases (as a percentage of
offering price) 3.25%*
Deferred sales charge None
(* 3% consumption tax on the sales charge will be added.)
ANNUAL FUND OPERATING EXPENSES
Management fees 0.65%
12b-1 fees 0.50%
Other expenses 0.20%
Total Fund operating expenses 1.35%
The table is provided to help you understand the expenses of
investing in class M shares of the Fund and of your share of the
operating expenses the Fund incurs. The expenses shown in the
table do not reflect the application of credits related to
expense offset arrangements that reduce certain Fund expenses.
The 12b-1 fee reflects the amount currently payable under the
Class M distribution plan.
EXAMPLE
An investment of $1,000 would incur the following expenses,
assuming 5% annual return and redemption at the end of each
period.
One year $46
3 years $74
5 years $104
10 years $190
The example does not represent past or future expense levels.
Actual expenses may be greater or less than those shown. Federal
regulations require the example to assume a 5% annual return, but
actual annual return varies. The 12b-1 fees borne by the class M
shares may cause long-term shareholders to pay more than the
economic equivalent of the maximum from-end sales charge
permitted by applicable regulation.
FINANCIAL HIGHLIGHTS
The following table presents per share financial information for
class M shares. This information has been audited and reported
on by the Fund's independent accountants. Financial statements
included in the Fund's annual report to shareholders for the 1995
fiscal year are presented in their entirety further on in this
prospectus. The Fund's annual report, which contains additional
information, is available without charge upon request.
For the period
December 1, 1994
(commencement
of operations)to
November 30
1995
Class M
Net asset value, beginning
of period $9.05
Investment operations
Net investment income .99
Net realized and unrealized gain
(loss) on investments .45
Total from investment operations 1.44
Less distributions:
From net investment income (.98)
In excess of net investment income --
From net realized gain on investments --
Paid in capital --
Total distributions (.98)
Net asset value, end of period $9.51
Total investment return at
net asset value (%) (a) 16.72
Net assets, end of period
(in thousands) $20,077
Ratio of expenses to average
net assets (%)(b) 1.35
Ratio of net investment income
to average net assets (%) 10.06
Portfolio turnover (%) 89.96
(a) Total investment return assumes dividend reinvestment and
does not reflect the effect of sales charges.
(b) The ratio of expenses to average net assets for the year
ended November 30, 1995 includes amounts paid through expenses
offset arrangements.
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