Franklin Templeton Investments has launched three new ETFs – Franklin Liberty Senior Loan ETF (FLBL), Franklin Liberty High Yield Corporate ETF (FLHY) and Franklin International Aggregate Bond ETF (FLIA).
Alls three ETFs are listed on the CBOE BZX exchange.
“In a persistently low-yield environment like the one we’ve been in, the need for income has intensified while advisors and clients are challenged in finding it,” says Patrick O’Connor, head of global ETFs. “With more than 150 fixed income investment professionals globally and dedicated teams that focus on various sectors across the credit spectrum, Franklin Templeton Fixed Income Group brings an in-depth understanding of the full opportunity set that can be leveraged to generate income. As investors look to get more income out of their fixed income allocation, these new ETFs enable them to access additional fixed income sectors globally in a targeted way, as they define what they need and how they want to achieve it.”
The three new ETFs are managed by Franklin Templeton Fixed Income Group team members who specialise in the asset classes.
Franklin Liberty Senior Loan ETF (FLBL) seeks to provide a high level of current income with a secondary goal of preservation of capital. The fund invests at least 80 per cent of its net assets in senior loans and investments that provide exposure to senior loans. Senior loans include loans referred to as leveraged loans, bank loans and/or floating rate loans. The fund invests predominantly in income-producing senior floating interest rate corporate loans made to or issued by US companies, non-US entities and US subsidiaries of non-US entities. FLBL is managed by Mark Boyadjian, SVP, director of Floating Rate Debt and portfolio manager, Madeline Lam, VP and portfolio manager, and Justin Ma, VP and portfolio manager.
Franklin Liberty High Yield Corporate ETF (FLHY) seeks to provide a high level of current income with a secondary goal of capital appreciation. The fund invests at least 80 per cent of its net assets in high yield corporate debt securities and investments that provide exposure to high yield corporate debt securities. The fund may enter into certain derivative transactions, principally currency and cross currency forwards and swap agreements, including interest rate and credit default swaps (including credit default index swaps). FLHY is managed by Glenn Voyles, SVP, director of Portfolio Management, Corporate Bonds, and Patricia O’Connor, VP and portfolio manager.
Franklin International Aggregate Bond ETF (FLIA) seeks to maximise total investment return, consistent with prudent investing, consisting of a combination of interest income and capital appreciation. The fund invests at least 80 per cent of its net assets in bonds and investments that provide exposure to bonds. Bonds include debt obligations of any maturity, such as bonds, notes, bills and debentures. The fund invests predominantly in fixed-and floating-rate bonds issued by governments, government agencies and governmental-related or corporate issuers located outside the US The fund may enter into various currency-related transactions involving derivative instruments, principally currency and cross currency forwards, but it may also use currency futures contracts. FLIA is managed by John Beck, SVP, director of Fixed Income-London, and portfolio manager.
These new ETFs expand Franklin Liberty Shares’ line-up of fixed income active ETFs to seven, also including: Franklin Liberty Short Duration US Government ETF (FTSD), Franklin Liberty Investment Grade Corporate ETF (FLCO), Franklin Liberty Intermediate Municipal Opportunities ETF (FLMI) and Franklin Liberty Municipal Bond ETF (FLMB). Each combines access to Franklin Templeton Fixed Income Group’s time-tested investment expertise with key ETF features, such as liquidity, competitive pricing, tax efficiency and transparency.