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Chief Executive Bob Reynolds, who took over at Putnam in July, also announced a major departure from the company's traditional reliance on quantitative-analysis models that once played a major role in shaping its overall investment strategies.
Putnam, which has lost tens of billions of dollars in assets since September, is making the changes to address long-term market challenges, not just react to current market turmoil, said Reynolds, a former top executive at Fidelity Investments.
Streamlining its equity operations, Putnam said it's consolidating six funds into other funds. The Putnam funds that will be effectively eliminated are Capital Appreciation, Classic Equity, Discover Growth, New Value, OTC & Emerging Funds and Tax Smart Equity.
Twelve portfolio managers lost their jobs yesterday, along with 35 additional staff members. The majority of Putnam's 2,500 jobs are located in Massachusetts.
Reynolds said all the cuts were in Putnam's investment unit -- and 29 of them were in its quantitative-analysis operations.
Louis Harvey, president of Boston's Dalbar Inc., said relying less on quantitative analysis -- in which complex mathematical models are used to help guide investments -- is a smart move.
"I guess you have to go back to old-fashioned human ingenuity," he said, referring to the failure of many models to predict today's market shocks.
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