PUTNAM OVERSEAS GROWTH FUND (the "fund")
                                     
              Prospectus Supplement dated August 1, 1996 to
             Class A shares Prospectus dated November 1, 1995

Effective August 12, 1996, the fund's name will change to "Putnam
International Growth Fund."  In addition, the first two
paragraphs under the section entitled "Basic investment strategy"
are replaced by the following:

     The fund seeks its objective by investing primarily in
     equity securities of companies located in a country other
     than the United States.  The fund's investments will
     normally include common stocks, preferred stocks, securities
     convertible into common or preferred stocks, and warrants to
     purchase common or preferred stocks.  The fund may also
     invest to a lesser extent in debt securities and other types
     of investments if Putnam Investment Management, Inc., the
     fund's investment manager ("Putnam Management"), believes
     purchasing them would help achieve the fund's objective. 
     The fund will, under normal circumstances, invest at least
     65% of its total assets in issuers located in at least three
     different countries other than the United States.  The fund
     may hold a portion of its assets in cash or money market
     instruments.

     The fund will consider an issuer of securities to be
     "located in a country other than the United States" if it is
     organized under the laws of a country other than the United
     States and has a principal office outside the United States,
     or if it derives 50% or more of its total revenues from
     business outside the United States.

The following text replaces the fifth sentence of the first
paragraph under the heading "How to buy shares":


     In order to be eligible to purchase shares at net asset
     value, a defined contribution plan must either initially
     invest at least $20 million in Putnam funds and other
     investments managed by Putnam Management or its
     affiliates or, if the dealer of record waives its
     commission with respect to such investment, initially
     invest at least $1 million in the fund.

The following text replaces the first four sentences of the second
paragraph under the heading "How to buy shares":

     On sales 
     of shares at
      net asset value to defined
     contribution plans initially investing at least $20
     million in Putnam funds and other investments managed by
     Putnam Management or its affiliates, Putnam Mutual Funds
     pays commissions on 
     the shares
      
     initially purchased
      and
     on subsequent net quarterly sales at the rate of 0.15%.
                                                  
8/96