Franklin Templeton, a long-time active fund manager, has rolled out its first group of passive global exchange traded funds that track customized or smart-beta indices.
The fund provider recently launched the Franklin LibertyQ International Equity Hedged ETF (NYSEArca: FLQH), Franklin LibertyQ Emerging Markets ETF (NYSEArca: FLQE), Franklin LibertyQ Global Dividend ETF (NYSEArca: FLQG) and Franklin LibertyQ Global Equity ETF (NYSEArca: FLQD).
Related: Institutional Smart-Beta ETF Adoption is Quickly Rising
The International Equity Hedged ETF will try to reflect the performance of the Franklin International Equity Hedged Index, a rules-based proprietary index based off the MSCI EAFE Index. Specifically, the fund will include company stocks from developed Europe, Australasia and the Far East with favorable style factors, including quality, value, momentum and low volatility. Top country weights include U.K. 26.7%, Japan 18.2%, Australia 13.6%, Switzerland 9.0% and Spain 4.7%. Additionally, the index will hedge currency risk against the U.S. dollar. FLQH has a 0.40% expense ratio.
The Emerging Markets ETF will try to reflect the performance of the Franklin Emerging Markets Index, which also tracks a different version of the MSCI Emerging Markets Index that aims to follow the performance of the Franklin Templeton’s investment strategy. The underlying index will include the four style factors of quality, value, momentum and low volatility, and generate lower level of risk and higher risk-adjusted performance than the MSCI Emerging Market benchmark. Top country weights include South Korea 15.5%, Taiwan 14.3%, U.S. 10.3%, Russia 9.0% and China 6.8%. FLQE has a 0.55% expense ratio.
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