Franklin Templeton recently announced the expansion of its active ETF lineup with the addition of its first alternative ETF, Franklin Liberty Systematic Style Premia ETF (FLSP). The fund seeks to deliver absolute return (positive returns in rising or falling markets) by employing a multi-asset, long/short strategy. FLSP is actively risk-managed, seeking a target annualized volatility of 8 percent, and targets four style factors: quality, value, momentum and carry.
“We are thrilled to bring our first alternative ETF to the market,” said Patrick O’Connor, global head of ETFs for Franklin Templeton. “FLSP is unique due to our intentional focus on building an alternative investment while seeking to minimize any correlation to traditional equity and fixed income asset classes. We find investors need tools to help mute or dampen volatility and to find more consistent returns across market cycles or in times of market stress. FLSP looks to address those challenges—and many others—in a low-cost, liquid ETF.”
This new ETF leverages the team’s focus on factor-based research, which is the same team behind its LibertyQ smart beta ETFs. Building this capability was a natural extension for Franklin’s ETF business.
FLSP will be managed by Dr. Chandra Seethamraju, senior vice president, head of quantitative strategies for Franklin Templeton Multi-Asset Solutions. This actively managed ETF does not seek to replicate the performance of a specified index and is listed on the NYSE Arca.
Getting Active in Fixed Income
As more investors enter the bond market, the space becomes more challenging as yield gets harder to come by, leaving investors clamoring for other ways to obtain yield in the current fixed income environment. As such, Franklin Templeton announced the expansion of its active fixed income ETF lineup earlier this year with the addition of the Franklin Liberty U.S. Core Bond ETF (NYSEArca: FLCB).
FLCB seeks to provide investors with diversified core fixed income exposure. FLCB is an active ETF that seeks total return through bottom-up fundamental bond selection and top-down sector.
“We believe active management is critical for achieving long-term returns and managing investment risk, particularly in multi-sector investment grade fixed income,” said Patrick O’Connor, global head of ETFs for Franklin Templeton. “We are thrilled to launch FLCB, which can serve as a core, building block allocation in an investor’s portfolio.”
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