The latest news in investment offerings, financial products and other services relative to wealth advisors and their clients.

Franklin Templeton
Following client demand, Franklin Templeton has just launched three new emerging markets funds. They include an actively-managed Luxembourg-registered Templeton Emerging Markets Ex-China fund, and two Ireland-domiciled passively managed UCITS exchange-traded funds (ETFs) – the Franklin FTSE Emerging ex-China UCITS ETF and the Franklin FTSE Emerging Markets UCITS ETF.

“Our market and client research has demonstrated that many clients are looking to customise their allocations to China. We are delighted that clients are now able to manage their Chinese equity exposure separately through these two new ex-China funds alongside our dedicated China-only products,” Jaspal Sagger, global head of product at Franklin Templeton, said.

"We also recognise that not all clients wish to manage their China allocation separately and prefer to simply seek broad emerging markets exposure,” Sagger added.

The Templeton Emerging Markets Ex-China fund, which is classified as Article 8 under the EU’s Sustainable Finance Disclosure Regulation (SFDR), aims to invest in emerging markets companies across the world, excluding China, using a valuation-aware approach. The fund will be actively managed and have a portfolio of 40 to 60 stocks constructed with a bottom-up approach and long-term outlook, the firm said in a statement.

It will be co-managed by Singapore-based Chetan Sehgal and Edinburgh-based Andrew Ness (pictured), portfolio manager of the Franklin Templeton Emerging Markets Equity (FTEME) team. The fund is registered in France, Germany, Italy, Spain and United Kingdom, the firm added.

“We’re currently at an interesting juncture for emerging markets. With China making up a large portion of the MSCI emerging market (EM) Index, we also see a large opportunity set in countries outside of China such as Brazil, India, South Korea and Taiwan, which are producing leading companies benefiting from rising domestic consumption and those that are powering the global economy,” Andrew Ness (pictured), co-manager of the Global Emerging Markets strategy, said. “There are strong investment opportunities such as offline and online consumer companies, banking, rising healthcare players and technology to name a few. These opportunities are underpinned by structural growth drivers such as consumer penetration, demographics and digitalisation.”

Both the Franklin FTSE Emerging ex-China UCITS ETF and the Franklin FTSE Emerging Markets UCITS ETF will offer a cost-effective and flexible way to access broad and diversified exposure to large and mid-capitalisation stocks. These passive ETFs will track the performance of FTSE Emerging ex China Index NR (net return) and FTSE Emerging Index NR. They will be managed by Dina Ting, head of global index portfolio management, and Lorenzo Crosato, ETF portfolio manager. 

The ETFs will list on the Deutsche Börse Xetra (XETRA) with tickers EMGM and EXCN on 23 October 2024, the London Stock Exchange (LSE) and the Borsa Italiana on 24 October 2024, the firm said. Furthermore, they are registered in France, Germany, Italy, Luxembourg, Spain and the UK. The new products will complement the fiim's emerging markets' ETF suite, especially on the single-country side, and will enable investors to custom build their portfolios at a cost-efficient price point.

Franklin Templeton has been continuously expanding its ETF range, most recently with the launch of its Franklin FTSE Japan UCITS exchange-traded fund (ETF). The offering is the first Japan index tracking ETF in its ETF range. See more commentary here.