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).
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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.
[related_stories]The Global Dividend ETF will track the Franklin Global Dividend Index, which is based off the MSCI ACWI ex REITs Index. The new ETF, though, will also utilize a multi-factor selection process based off growth and sustainability of dividends as well as quality while seeking a lower level of risk and higher risk-adjusted performance than the MSCI ACWI ex REITs Index. Top country weights include 55.0%, U.K. 9.1%, Japan 4.8%, Australia 3.6% and Canada 2.6%. FLQG has a 0.35% expense ratio.
Lastly, the Global Equity ETF will try to reflect the performance of the Franklin Global Equity Index, which is based off the MSCI ACWI Index. The ETF’s benchmark will also screen for the four quality, value, momentum and low volatility factors. Top country weights include U.S. 33.0%, U.K. 16.9%, Australia 11.8%, Canada 10.5% and Switzerland 4.2%. FLQD has a 0.45% expense ratio.
Related: Franklin Templeton Enters ETF Arena
The four new smart-beta global ETFs will join Franklin Templeton’s actively managed U.S. bond ETF, the Franklin Liberty Short Duration U.S. Government ETF (NYSEArca: FTSD), which was launched back in 2013.
For more information on new fund products, visit our new ETFs category.