Concentrated funds, such as Putnam Capital Spectrum Fund and Putnam Equity Spectrum Fund, seem to take the active manager’s maxim “go big or go home” further than most, according to a recent Wall Street Journal blog post. As of March 31, the 10 biggest holdings accounted for 72.1% of the Capital fund’s $6.1 billion in assets and 76.7% of the Spectrum fund’s $1.8 billion in assets. “The average U.S. stock fund with more than $1 billion has only 22% of assets in its top 10 holdings,” based on Morningstar data. The funds were started in 2009 by David Glancy and have produced average annual returns of 22.1% (Capital) and 24.8% (Spectrum) for the 2010 to 2013 period. They are risky, and Putnam’s CIO Walter Donovan explains that they are marketed as “a concentrated strategy” and potential investors are told that approach “can increase the vulnerability.” Further, the funds are available only through financial advisors. The risk is that if these funds need to sell in a hurry, “who will buy [their stocks] in such quantity?” Significant drops in 2015 (9% for Capital and 14% for Spectrum) coincided with investors pulling $5 billion out of these two funds for the trailing year ending March 31, 2016. Donovan says, “We do monitor the issues as to how these funds are composed and the liquidity of the funds, and we’re in a good place right now.”