San Mateo, CA, October 5, 2016 – Franklin Templeton Investments today introduced a new suite of actively managed ETFs to its Franklin LibertyShares platform. The suite includes two new active ETFs, Franklin Liberty U.S. Low Volatility ETF (FLLV) and Franklin Liberty Investment Grade Corporate ETF (FLCO), as well as Franklin Liberty Short Duration U.S. Government ETF (FTSD), an active ETF launched in 2013.
“Building on the success of our Franklin LibertyShares ETF platform launch earlier this year, we are pleased to reach another milestone by introducing our new suite of actively managed ETFs,” said Patrick O’Connor, Global Head of ETFs for Franklin Templeton Investments. “Investors have embraced the ETF wrapper for its benefits, which may include liquidity, tax efficiency and transparency. Now they want the opportunity to seek better risk-adjusted returns over the long term. Through Franklin LibertyShares, we are providing investors with simple and efficient options to help them address their desired outcomes. Our actively managed ETFs can help investors meet their investment needs by serving as a core or complementary portfolio holding.”
Franklin LibertyShares’ suite of actively managed ETFs currently includes one equity and two fixed income ETFs:
- Franklin Liberty U.S. Low Volatility ETF (FLLV) seeks capital appreciation with an emphasis on lower volatility than the broader U.S. equity market, as measured by the Russell 1000 Index. The fund applies a fundamentally driven “bottom up” research process to identify stocks that exhibit strong fundamental characteristics and screens for stocks with the lowest realized volatility scores, based on a proprietary quantitative model, relative to their corresponding sectors. Risk considerations are incorporated into the final stock selection process. The ETF is managed by Todd Brighton, CFA1, vice president, research analyst and portfolio manager for Franklin Equity Group.
- Franklin Liberty Investment Grade Corporate ETF (FLCO) seeks to provide a high level of current income as is consistent with prudent investing, while seeking preservation of capital by investing at least 80% of its net assets in investment grade corporate debt securities and investments. The fund may invest up to 40% of its net assets in foreign securities, including those in developed markets, and up to 15% of its net assets in non-U.S. dollar denominated securities. The ETF is managed by Marc Kremer, CFA, vice president, research analyst and portfolio manager, and Shawn Lyons, CFA, vice president, research analyst and portfolio manager for Franklin Templeton Fixed Income Group®.
- Franklin Liberty Short Duration U.S. Government ETF (FTSD) seeks to provide a high level of current income as is consistent with prudent investing, while seeking preservation of shareholders’ capital by investing at least 80% of its net assets in securities issued or guaranteed by the U.S. government, its agencies or instrumentalities. The fund targets an estimated average portfolio duration of three years or less. The ETF is managed by Roger Bayston, CFA, senior vice president and portfolio manager for Franklin Templeton Fixed Income Group. Launched in 2013, the ETF has assets under management of approximately $169 million2.
Franklin Liberty actively managed ETFs strive to outperform traditional market capitalization weighted index products that are designed only to track benchmark indices. Portfolio managers of the Franklin Liberty active ETFs have the opportunity to respond with discretion to market events and operate outside the confines of traditional benchmark indices. They can make attractive equity and fixed income investments that they believe can outperform the market, including those not owned in benchmark indices.
“Our actively managed ETF offerings leverage Franklin Templeton’s extensive expertise and resources as a premier fundamental, active investment manager. Our world-class global research platform integrates the insights of over 650 investment professionals, including seasoned equity and fixed income professionals, to allow us to take a holistic approach in evaluating each company or debt instrument. Our ability to combine our research prowess, with the attractive benefits of an ETF structure, is our competitive advantage,” added O’Connor.
With the introduction of its new actively managed ETFs, Franklin Templeton expands its Franklin LibertyShares fund offerings to seven ETFs. The existing strategic beta fund suite includes three LibertyQ multi-factor core portfolio ETFs—Franklin LibertyQ Global Equity ETF (FLQG), Franklin LibertyQ Emerging Markets ETF (FLQE) and Franklin LibertyQ International Equity Hedged ETF (FLQH)—and one ETF that focuses on stocks with high and persistent dividend income, Franklin LibertyQ Global Dividend ETF (FLQD).3
Franklin LibertyShares platform of strategic beta and actively managed ETFs leverages the investment expertise, active management insights and deep resources of Franklin Templeton Investments, a recognized global leader in asset management with more than 65 years of experience. Franklin LibertyShares has approximately $324 million2 in assets under management.
For more information, please visit https://franklin.kurtosysdev.com.
Important Information about the Franklin LibertyShares ETFs:
All investments involve risks, including possible loss of principal. Generally, those offering potential for higher returns are accompanied by a higher degree of risk. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Bond prices are affected by interest rate changes. Bond prices, and thus a bond fund's share price, generally move in the opposite direction of interest rates. As the price of bonds in a fund adjusts to a rise in interest rates, the fund's share price may decline. Foreign investing, especially in developing markets, has additional risks such as currency and market volatility and political or social instability. By clicking on the fund name, you will be taken to a more detailed fund information page which includes main investments and risks.
ETFs trade like stocks, fluctuate in market value and may trade at prices above or below the ETF’s net asset value. Brokerage commissions and ETF expenses will reduce returns. There is no guarantee that any strategy will achieve its objective.
Investors should carefully consider a fund’s investment goals, risks, charges and expenses before investing. To obtain a summary prospectus and/or prospectus, which contains this and other information, talk to your financial advisor, call us at (800) DIAL BEN / (800)342-5236 or visit franklin.kurtosysdev.com. Please carefully read a prospectus before you invest or send money.
About Franklin Templeton Investments
The funds’ principal underwriter is Franklin Templeton Distributors, Inc., a wholly-owned subsidiary of Franklin Resources, Inc. [NYSE:BEN], a global investment management organization operating as Franklin Templeton Investments. Franklin Templeton Investments provides global and domestic investment management to retail, institutional and sovereign wealth clients in over 180 countries. Through specialized teams, the company has expertise across all asset classes – including equity, fixed income, alternative and custom solutions. The company’s more than 600 investment professionals are supported by its integrated, worldwide team of risk management professionals and global trading desk network. With offices in 35 countries, the California-based company has more than 65 years of investment experience and over $740 billion in assets under management as of August 31, 2016. For more information, please visit franklintempleton.com.
1. CFA® and Chartered Financial Analyst® are trademarks owned by CFA Institute.
2. As of October 4, 2016.
3. Strategic beta refers to a methodology of index construction that seeks to achieve better risk-adjusted returns compared to traditional market capitalization weighted benchmark indices. Each of the Franklin LibertyQ strategic beta ETFs tracks a corresponding LibertyQ index developed with Franklin Templeton’s team of quantitative experts who have spent decades developing quantitative active equity strategies, coupled with academic research.