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Name Title John Hancock Investments Date

Name Title John Hancock Investments Date. Three things to know about today’s bond market. 1. Declining interest rates have driven bond returns higher for more than 20 years. 2. With today’s low yields, rate increases could lead to big losses. 3.

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Name Title John Hancock Investments Date

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  1. Name Title John Hancock Investments Date

  2. Three things to know about today’s bond market 1 • Declining interest rates have driven bond returns higher for more than 20 years 2 • With today’s low yields, rate increases could lead to big losses 3 • Stretching for income is a risky proposition Source: John Hancock Investments, 2017.

  3. 1 Declining interest rates have driven bond returns higher for more than 20 years 10-year U.S. Treasuries Federal funds rate Recession % MAR─MAY 2003 Iraq invasion OCT 1997 Asian currency crisis OCT 2014 QE purchases end AUG 2005 Hurricane Katrina AUG─SEPT 1998 Long-Term Capital Management collapse SEPT─NOV 2008 Lehman Brothers bankruptcy, QE1 DEC 2009 European sovereign debt crisis begins DEC 1998 President Clinton impeached DEC 2015 First Fed rate hike in nine years OCT 2010 QE2 MAR 2000 Tech bubble bursts MAR 2011 Tsunami hits Japan SEPT 2001 September 11 terrorist attacks AUG 2011 U.S. debt downgraded DEC 2001, JUL 2002 Enron, WorldCom bankruptcies NOV 2016 Trump elected president MAR 2012 Greece defaults SEPT 2012 QE3 MAY 2013 Fed’s tapering comments Source: U.S. Department of the Treasury, Federal Reserve Bank of St. Louis, as of 12/31/16. For illustrative purposes only. The benchmark for short-term lending, the federal funds rate is periodically set by the Federal Reserve Board and reflects the interest rate banks charge each other for overnight loans. Please see slide 17 for complete definitions. At today’s levels, interest rates can’t get much lower

  4. 2 With today’s low yields, rate increases could lead to big losses According to one study: If rates rise 3% over the course of 3 years bondholders could lose more than of their portfolios’ value 22% Source: “When Bonds Fall: How Risky Are Bonds if Interest Rates Rise?” Welton Investment Corporation, 2012. Because the income offered today is so low, it could take years for coupon payments to make up for any capital losses

  5. 3 Stretching for income is a risky proposition 20 10 0 –10 –20 –30 Bloomberg Barclays U.S. Aggregate Bond Index 10-year U.S. Treasuries Source: Barclays Capital, John Hancock Research, as of 3/31/17. Duration measures the sensitivity of the price of bonds to a change in interest rates. It is not possible to invest directly in an index. Prior to 8/24/16, the index was named the Barclays U.S. Aggregate Bond Index. Please see slide 17 for complete definitions. Past performance does not guarantee future results. Passive strategies have significant exposure to interest-rate risk

  6. After more than seven years of near-zero interest rates, the Fed has finally begun normalizing monetary policy U.S. Federal Reserve balance sheet (in trillions) Source: U.S. Federal Reserve, as of 12/31/16. How can investors prepare their portfolios for less accommodative policy from the U.S. Federal Reserve?

  7. Look beyond the mainstream for new opportunities Growth of $100,000 through various interest-rate cyclesPeriods of rising rates are highlighted below $600,000 $576,736 500,000 $398,994 400,000 $279,850 300,000 $276,253 $275,547 $272,066 $257,829 200,000 100,000 75,000 Source: Morningstar Direct, Stone Harbor Investment Partners, Western Asset Management Company, as of 3/31/17. Emerging-market debt is measured by the J.P. Morgan Emerging Markets Bond Index (EMBI) Global Diversified Index, which tracks U.S. dollar-denominated Brady bonds, loans, and Eurobonds of external debt instruments in the emerging markets. High-yield bonds are measured by the Bank of America Merrill Lynch (BofA ML) U.S. High Yield Master II Index, which tracks the performance of globally issued, U.S. dollar-denominated high-yield bonds. Core U.S. bonds are represented by the Bloomberg Barclays U.S. Aggregate (Agg) Bond Index, which tracks the performance of U.S. investment-grade bonds in government, asset-backed, and corporate debt markets. Mortgage-backed securities are measured by the Bloomberg Barclays U.S. Mortgage Backed Securities Index, an unmanaged index comprising 15- and 30-year fixed-rate securities backed by the mortgage pools of Ginnie Mae, Freddie Mac, and Fannie Mae. Floating-rate notes are measured by the S&P/LSTA Leveraged Loan Index, which tracks returns in the leveraged loan market and captures a broad cross section of the U.S. leveraged loan market, including dollar-denominated, U.S.-syndicated loans to overseas issuers and excluding those in default. Short-term credit is measured by the Bloomberg Barclays Credit 1–5 Year U.S. Index, which tracks the performance of U.S. government and international, U.S. dollar-denominated, investment-grade corporate bonds with maturities between one and five years. 10-year U.S. Treasuries are measured by the BofA ML 10-year U.S. Treasury Index, a one-security index comprising the most recently issued 10-year U.S. Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 10-year note must be auctioned on or before the third business day before the last business day of the month. It is not possible to invest directly in an index. Bloomberg was added to the Barclays index names on 8/24/16. Please see slide 17 for complete definitions. Past performance does not guarantee future results. The rising-rate periods included in the illustrations above are 9/30/98–5/31/00, 5/30/03–6/29/07, 12/31/08–4/30/10, and 7/31/12–12/31/13, the four longest periods of broad interest-rate increases during the past 20 years. Not all sectors of the bond market are dependent on declining rates to generate returns

  8. Expand your fixed-income horizons Annualized return during rising rates1 Yield Source: Morningstar Direct, Stone Harbor Investment Partners, Western Asset Management Company, as of 3/31/17. Emerging-market debt is measured by the J.P. Morgan Emerging Markets Bond Index (EMBI) Global Diversified Index, which tracks U.S. dollar-denominated Brady bonds, loans, and Eurobonds of external debt instruments in the emerging markets. High-yield bonds are measured by the Bank of America Merrill Lynch (BofA ML) U.S. High Yield Master II Index, which tracks the performance of globally issued, U.S. dollar-denominated high-yield bonds. Core U.S. bonds are represented by the Bloomberg Barclays U.S. Aggregate (Agg) Bond Index, which tracks the performance of U.S. investment-grade bonds in government, asset-backed, and corporate debt markets. Mortgage-backed securities are measured by the Bloomberg Barclays U.S. Mortgage Backed Securities Index, an unmanaged index comprising 15- and 30-year fixed-rate securities backed by the mortgage pools of Ginnie Mae, Freddie Mac, and Fannie Mae. Floating-rate notes are measured by the S&P/LSTA Leveraged Loan Index, which tracks returns in the leveraged loan market and captures a broad cross section of the U.S. leveraged loan market, including dollar-denominated, U.S.-syndicated loans to overseas issuers and excluding those in default. Short-term credit is measured by the Bloomberg Barclays Credit 1–5 Year U.S. Index, which tracks the performance of U.S. government and international, U.S. dollar-denominated, investment-grade corporate bonds with maturities between one and five years. 10-year U.S. Treasuries are measured by the BofA ML 10-year U.S. Treasury Index, a one-security index comprising the most recently issued 10-year U.S. Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 10-year note must be auctioned on or before the third business day before the last business day of the month. It is not possible to invest directly in an index. Bloomberg was added to the Barclays index names on 8/24/16. Please see slide 17 for complete definitions. Past performance does not guarantee future results. 1 The rising-rate periods included in the illustrations above are 9/30/98–5/31/00, 5/30/03–6/29/07, 12/31/08–4/30/10, and 7/31/12–12/31/13, the four longest periods of broad interest-rate increases during the past 20 years. Sectors beyond the mainstream have tended to outperform in rising-rate environments and they generally offer higher yields as well

  9. Not all bond market sectors move in unison 10-year correlation, as of 3/31/17 Bloomberg Barclays U.S. Aggregate Bond Index 10-year U.S. Treasuries Source: Morningstar Direct, as of 3/31/17. Correlation is a statistical measure that describes how investments move in relation to each other, which ranges from –1.00 to 1.00. The closer the number is to 1.00 or –1.00, the more closely the two investments are related. Diversification does not guarantee a profit or eliminate the risk of a loss. It is not possible to invest directly in an index. Prior to 8/24/16, the index was named the Barclays U.S. Aggregate Bond Index. Please see slide 17 for complete definitions. Past performance does not guarantee future results. Low and negative correlation is the key to building a diversified portfolio

  10. Broadening your fixed-income portfoliocan help you avoid concentrated risks • A diversified fixed-income portfolio produced higher returns with lower duration Performance results Traditional index-oriented portfolio Diversified bond portfolio Core U.S. bonds Emerging-market debt High-yield bonds Mortgage-backed securities Floating-rate notes Short-term credit Source: Morningstar Direct, as of 3/31/17. For illustrative purposes only. Diversification does not guarantee a profit or eliminate the risk of a loss. Standard deviation measures performance fluctuation, may not be indicative of future risk, and is not a predictor of returns.

  11. A range of fixed-income investment options 1 The inception date for the fund’s oldest class of shares, Class A shares, is 11/9/73. Class I shares were first offered on 9/4/01. Returns prior to this date for are those of Class A shares that have been recalculated to reflect the gross fees and expenses of Class I shares. Returns for Class A shares have been adjusted to reflect the reduction in the maximum sales charge from 4.5% to 4.0%, effective 2/3/14. 2 Represents the effect of a fee waiver and/or expense reimbursement through 9/30/17 and is subject to change. The past performance shown here reflects reinvested distributions and the beneficial effect of any expense reductions, and does not guarantee future results. Returns for periods shorter than one year are cumulative, and results for other share classes will vary. Shares will fluctuate in value and, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance cited. For the most recent month-end performance, visit jhinvestments.com.

  12. A range of fixed-income investment options 1 Returns for Class A shares have been adjusted to reflect the reduction in the maximum sales charge from 4.5% to 4.0%, effective 2/3/14. 2 Represents the effect of a fee waiver and/or expense reimbursement through 12/31/17 and is subject to change. The past performance shown here reflects reinvested distributions and the beneficial effect of any expense reductions, and does not guarantee future results. Returns for periods shorter than one year are cumulative, and results for other share classes will vary. Shares will fluctuate in value and, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance cited. For the most recent month-end performance, visit jhinvestments.com.

  13. A range of fixed-income investment options 1 Returns for Class A shares have been adjusted to reflect the reduction in the maximum sales charge from 3.0% to 2.5%, effective 2/3/14. The past performance shown here reflects reinvested distributions and the beneficial effect of any expense reductions, and does not guarantee future results. Returns for periods shorter than one year are cumulative, and results for other share classes will vary. Shares will fluctuate in value and, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance cited. For the most recent month-end performance, visit jhinvestments.com.

  14. A range of fixed-income investment options 1 The inception date for the fund’s oldest class of shares, Class A shares, is 12/31/91. Class I shares were first offered on 7/28/03. Returns prior to this date for are those of Class A shares that have been recalculated to reflect the gross fees and expenses of Class I shares. Returns for Class A shares have been adjusted to reflect the reduction in the maximum sales charge from 4.5% to 4.0%, effective 2/3/14. 2 Represents the effect of a fee waiver and/or expense reimbursement through 9/30/17 and is subject to change. The past performance shown here reflects reinvested distributions and the beneficial effect of any expense reductions, and does not guarantee future results. Returns for periods shorter than one year are cumulative, and results for other share classes will vary. Shares will fluctuate in value and, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance cited. For the most recent month-end performance, visit jhinvestments.com.

  15. A range of fixed-income investment options 1 Returns for Class A shares have been adjusted to reflect the reduction in the maximum sales charge from 4.5% to 2.5%, effective 2/3/14. The past performance shown here reflects reinvested distributions and the beneficial effect of any expense reductions, and does not guarantee future results. Returns for periods shorter than one year are cumulative, and results for other share classes will vary. Shares will fluctuate in value and, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance cited. For the most recent month-end performance, visit jhinvestments.com.

  16. A range of fixed-income investment options 1 The inception date for the fund’s oldest class of shares, Class NAV shares, is 4/28/06. Class A and Class I shares were first offered on 1/4/10. Returns prior to this date are those of Class NAV shares that have been recalculated to apply the gross fees and expenses of Class A and Class I shares. Returns for Class A shares have been adjusted to reflect the reduction in the maximum sales charge from 4.5% to 4.0%, effective 2/3/14. 2 Represents the effect of a fee waiver and/or expense reimbursement through 12/31/17 and is subject to change. The past performance shown here reflects reinvested distributions and the beneficial effect of any expense reductions, and does not guarantee future results. Returns for periods shorter than one year are cumulative, and results for other share classes will vary. Shares will fluctuate in value and, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance cited. For the most recent month-end performance, visit jhinvestments.com.

  17. Important definitions 10-year U.S. Treasuries are measured by the Bank of America Merrill Lynch (BofA ML) 10-Year U.S. Treasury Index, a one-security index comprising the most recently issued 10-year U.S. Treasury note. The index is rebalanced monthly. In order to qualify for inclusion, a 10-year note must be auctioned on or before the third business day before the last business day of the month. Bloomberg Barclays U.S. Aggregate Bond Index tracks the performance of U.S. investment-grade bonds in government, asset-backed, and corporate debt markets. Prior to 8/24/16, the index was named the Barclays U.S. Aggregate Bond Index. Core U.S. bonds are represented by the Bloomberg Barclays U.S. Aggregate Bond Index, which tracks the performance of U.S. investment-grade bonds in government, asset-backed, and corporate debt markets. Prior to 8/24/16, the index was named the Barclays U.S. Aggregate Bond Index. Emerging-market debt is measured by the J.P. Morgan Emerging Markets Bond Index (EMBI) Global Diversified Index, which tracks the U.S. dollar-denominated Brady bonds, loans, and Eurobonds of external debt instruments in the emerging markets. Federal funds rate is the interest rate at which a depository institution lends funds maintained at the U.S. Federal Reserve to another depository institution overnight. Floating-rate notes are measured by the S&P/LSTA Leveraged Loan Index, which tracks returns in the leveraged loan market and captures a broad cross section of the U.S. leveraged loan market, including dollar-denominated, U.S.-syndicated loans to overseas issuers and excluding those in default. High-yield bonds are measured by the BofA ML U.S. High Yield Master II Index, which tracks the performance of globally issued, U.S. dollar-denominated high-yield bonds. Mortgage-backed securities are measured by the Bloomberg Barclays U.S. Mortgage-Backed Securities Index, an unmanaged index comprising 15- and 30-year fixed-rate securities backed by the mortgage pools of Ginnie Mae, Freddie Mac, and Fannie Mae. Prior to 8/24/16, the index was named the Barclays U.S. Mortgage-Backed Securities Index. Recession is a significant decline in activity across the economy, lasting longer than a few months. Short-term credit is measured by the Bloomberg Barclays Credit 1–5 Year U.S. Index, which tracks the performance of U.S. government and international, U.S. dollar-denominated, investment-grade corporate bonds with maturities between one and five years. Prior to 8/24/16, the index was named the Barclays Credit 1–5 Year U.S. Index. It is not possible to invest directly in an index. Past performance does not guarantee future results.

  18. A word about risk Fixed-income investments are subject to interest-rate and credit risk; their value will normally decline as interest rates rise or if an issuer is unable or unwilling to make principal or interest payments. Investments in higher-yielding, lower-rated securities include a higher risk of default. Foreign investing, especially in emerging markets, has additional risks, such as currency and market volatility and political and social instability. Liquidity—the extent to which a security may be sold or a derivative position closed without negatively affecting its market value, if at all—may be impaired by reduced trading volume, heightened volatility, rising interest rates, and other market conditions. Currency transactions are affected by fluctuations in exchange rates. Frequent trading may increase fund transaction costs and increase taxable distributions. The use of hedging and derivatives could produce disproportionate gains or losses and may increase costs. A portfolio concentrated in one sector or that holds a limited number of securities may fluctuate more than a diversified portfolio. Loan participations and assignments involve additional risks, including credit, interest-rate, counterparty, liquidity, and lending risk. Mortgage- and asset-backed securities may be sensitive to changes in interest rates, and may be subject to early repayment and the market’s perception of issuer creditworthiness. Absolute return funds are not designed to outperform stocks and bonds in strong markets. There is no guarantee of a positive return, of the fund achieving its objective, or that volatility-reducing strategies will be successful. Fund distributions generally depend on income from underlying investments and may vary or cease altogether in the future. Please see the funds’ prospectuses for additional risks. This material is not intended to be, nor shall it be interpreted or construed as, a recommendation or providing advice, impartial or otherwise. John Hancock Investments and its representatives and affiliates may receive compensation derived from the sale of and/or from any investment made in its products and services.

  19. John Hancock Investments A trusted brand John Hancock Investments is a premier asset manager representing one of America’s most trusted brands, with a heritage of financial stewardship dating back to 1862. Helping our shareholders pursue their financial goals is at the core of everything we do. It’s why we support the role of professional financial advice and operate with the highest standards of conduct and integrity. A better way to invest We serve investors globally through a unique multimanager approach: We search the world to find proven portfolio teams with specialized expertise for every strategy we offer, then we apply robust investment oversight to ensure they continue to meet our uncompromising standards and serve the best interests of our shareholders. Results for investors Our unique approach to asset management enables us to provide a diverse set of investments backed by some of the world’s best managers, along with strong risk-adjusted returns across asset classes.

  20. Request a prospectus or summary prospectus from your financial advisor, by visiting jhinvestments.com, or by calling us at 800-225-5291. The prospectus includes investment objectives, risks, fees, expenses, and other information that you should consider carefully before investing. Connect with John Hancock Investments: @JH_Investments | jhinvestmentsblog.com • MF350674 • PIFIPPT 5/17

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