“We launched a bunch of smart beta offerings – our LibertyQs,” Caramazza said. “We’ve built them off of a lot of the same stock picking tenets that we’ve sued across the firm, right – quality, value, low volatility, momentum – and looking at those for the entire index, building them together, gives us what we think is a very compelling opportunity that’s built on the tenets of long-term Franklin views.”
Specifically, Franklin Templeton has launched a suite of LibertyQ smart beta ETFs, including the Franklin LibertyQ U.S. Equity ETF (BATS: FLQL), Franklin LibertyQ U.S. Mid Cap Equity ETF (BATS: FLQM), Franklin LibertyQ U.S. Small Cap Equity ETF (BATS: FLQS),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), among others. Each of the smart beta ETFs screen for companies in their respective market capitalization and segments based on four factors, including quality, value, momentum and low volatility.
“The way we’ve built our smart betas is as we’ve looked at at them for a risk-adjusted perspective,” Caramazza said. “We really tried to do them, not to beat the marketplace in any sort of give year, but really to do a long-term view and to have a risk-adjusted number where we protect on the downside, get some of the upside. And over the long-term, we think we do well.”
For more on smart beta ETFs, visit our Smart Beta Channel.