Franklin Templeton (BEN) is a well-known financial institution that offers investors a variety of investment options, including hundreds of mutual funds, to help them manage their wealth. Franklin Templeton mutual funds have highly experienced management teams, and rigorous investing strategies, and receive good ratings from fund rating organizations.

1. Franklin Mutual European Fund Class A (TEMIX)

• Assets under management (AUM): $842.47 million as of Jan. 31, 2022
• 5-year average annual net asset value (NAV) return: 6.09% as of Jan. 31, 2022
• Net expense ratio: 1.33% as of May 01, 2021

The Franklin Mutual European Fund Class A seeks capital appreciation, with income as a secondary goal, by investing at least 80% of its net assets in the securities of European companies. It focuses primarily on undervalued equity securities and, to a lesser extent, distressed securities and merger arbitrage opportunities.

Because the fund purchases equity securities in foreign currencies, such as the euro and British pound sterling, the fund’s returns are highly exposed to currency risk and may fluctuate due to changes in exchange rates.

As of Jan. 31, 2022, the fund has exposure to German and U.K. stocks with slightly more than a 22% allocation each, while 19.09% is allocated to France and 11.41% to the Netherlands.

Regarding sector allocation, below are the top five sectors with the highest portfolio weighting within the TEMIX:

• Capital goods: 13.92%
• Banks: 10.48%
• Insurance: 10.01%
• Food, beverage, and tobacco: 9.37% 
• Consumer Durables and Apparel: 7.45%

Note that the TEMIX fund charges load fees of 5.5% for investment balances of less than $50,000 and it requires a minimum investment of $1,000.

2. Franklin Federal Tax-Free Income Fund (FRFTX)

• AUM: $11.96 billion as of Jan. 31, 2022
• 5-year average annual NAV return: 2.55% as of Jan. 31, 2022
• Net expense ratio: 1.18% as of Sept. 01, 2021

The Franklin Federal Tax-Free Income Fund Class C seeks to generate current income by investing in tax-exempt municipal bonds issued by U.S. municipalities. Because municipal bonds are exempt from federal taxes, this fund is most appropriate for investors in high tax brackets. The fund typically buys and holds municipal bonds until maturity, which results in a very low turnover ratio.

This makes the Franklin Federal Tax-Free Income Fund highly tax-efficient. Bonds issued by municipalities in New York, Texas, and Florida have the highest weights in the fund’s portfolio. Over 80% of the fund’s bonds are investment-grade.

Read Also: Liquidity Management for Businesses: Strategies for Optimizing Cash and Marketable Securities

The fund has an average duration of 6.49 years and a 30-day SEC yield of 0.89% as of Jan. 31, 2022. The FRFTX is one of the oldest Franklin funds and has been managed by the same fund manager since 1996. The fund has a minimum investment requirement of $1,000 and a 1% load.

3. Franklin Utilities Fund Class A (FKUQX)

• AUM: $6.55 billion as of Jan. 31, 2022
• 5-year average annual NAV return: 9.90% excluding sales charges as of Jan. 31, 2022
• Net expense ratio: 0.82% as of Feb. 01, 2022

The Franklin Utilities Class A invests more than 98% of its assets in equity securities of firms that provide utility services, such as electricity, gas, and water. As of Feb. 01, 2022, the fund charges a load fee of 3.75% and has a minimum investment requirement of $1,000.

4. Templeton Global Bond Fund Class A (TPINX)

• AUM: $8.06 billion as of Jan. 31, 2022
• 5-year average annual NAV return: -1.07% excluding sales charges as of Jan. 31, 2022
• Net expense ratio: 0.92% as of May 01, 2022

The Templeton Global Bond Fund Class A searches the world for investment opportunities in currencies, interest rates, and sovereign credit that can offer attractive potential returns and additional portfolio diversification.

As of Jan. 31, 2022, sovereign bonds issued by countries in Asia have the largest weights in the fund’s portfolio, with 42.81% total allocation. Overall, bonds issued by Latin American and Caribbean countries account for 20.33%, and the North American countries account for 12.91% of the fund’s portfolio. The fund holds 8.82% of the portfolio in cash and cash equivalents. The fund’s average duration is 2.21 years, and SEC yield is 3.55%.

Michael Hasenstab has managed the Templeton Global Bond Fund since 2001, while Calvin Ho has co-managed the fund since 2008. The fund requires investors to contribute at least $1,000 and pay a 3.75% load.

How Does Franklin Templeton Mutual Fund Work?

Investing in mutual funds is a popular way for individuals to grow their wealth over time. Among the many mutual fund companies available to investors, Franklin Templeton is one of the most well-known and respected in the industry.

Documents required to invest in Franklin Templeton Mutual Fund

The documents for KYC (Know Your Client) include proof of address and proof of identity. Here is a list of officially valid documents (OVD) admissible.

PROOF OF IDENTITY

• PAN Card (Mandatory)
• Voter ID Card
• Driving License
• Passport
• Aadhaar Card
• Any other valid identity card issued by Central or State Government

PROOF OF ADDRESS

• Voter ID Card
• Driving License
• Passport
• Ration Card
• Aadhaar Card
• Bank account statement or bank passbook
• Utility bills like electricity or gas bills

While these are some of the standard document list, submitting all of these documents is a tedious process and can procrastinate your plan of investing. This is where ET Money offers you a paperless and fast solution.

You can submit your KYC in under two minutes by uploading the photos of your identity and address proof. This includes PAN and any one of your Aadhaar, Voter ID, Driving License & Passport along with your signature, a selfie and a live video, authenticating your identity. ET Money’s quick KYC application makes investing easy and hassle-free.

It takes about 3-5 working days to get your KYC verified as the verification is done by government certified agencies.

You can invest in the schemes of Franklin Templeton Mutual Fund in any of the following three ways:

1. Through Franklin Templeton Mutual Fund’s website
2. Through a distributor
3. Through the ET Money platform

If you prefer investing through the AMC’s website, you have to sign up first and create an account. Following this, you will have to complete the remaining steps mentioned on the website.

However, this is not a hassle-free option, especially if you have invested in multiple mutual funds from different AMCs. In that case, you will have to sign up with the individual website of each fund house. It’s difficult to track your investments and analyse them on multiple websites.

The second option is to invest through a distributor. However, you will then pay a higher expense ratio because the distributors charge a commission on every investment you make. This will bring down your overall returns. A much simpler, efficient and effective way of investing in schemes from Franklin Templeton Mutual Fund or any other fund house is through the ET Money platform.

On ET Money platform, just sign up once, and you can start investing in schemes from multiple fund houses. You can choose from various schemes of Franklin Templeton Mutual Fund, and that too, at a lower expense ratio since ET Money is a direct investment platform. You can track your existing portfolio on the platform and also view all your old and new investments in one place. It’s much simpler to track them and easier to make better-informed decisions.

That’s not all; the ET Money investment platform offers many valuable details like a fund’s past performance, returns consistency, fund history, expense ratio and exit load, to mention a few.

How to invest in mutual funds via ET Money

• Sign up using email and OTP.
• Select fund. Enter the investment amount. Choose the investment type: one-time (Lumpsum) or SIP.
• Enter PAN, full name and verify mobile number.
• Enter bank account details and select payment mode. In the case of SIP, set up a mandate.
• Follow the KYC process, which includes a selfie and a live video. Provide essential details and eSign.
• The transaction is processed on verification of KYC documents.

Benefits of Franklin Templeton Mutual Funds

With a wide range of mutual funds available, Franklin Templeton provides investors with options to suit their specific investment goals and risk tolerances. However, as with any investment, there are benefits and risks associated with investing in Franklin Templeton mutual funds.

1. Diversification: One of the main benefits of investing in mutual funds is the ability to diversify your portfolio. Franklin Templeton offers a wide range of mutual funds that invest in different asset classes, industries, and geographical regions. This diversification helps reduce the overall risk of your investment portfolio.
2. Professional Management: Another benefit of investing in Franklin Templeton mutual funds is the professional management provided by experienced fund managers. These fund managers have the expertise to analyze market trends, assess risk, and make informed investment decisions on behalf of their investors.
3. Flexibility: Franklin Templeton offers mutual funds with different investment strategies and risk profiles, allowing investors to choose a fund that best fits their investment goals and risk tolerance. Additionally, investors can choose from a variety of investment account types, including individual retirement accounts (IRAs), 401(k) plans, and taxable accounts.

Risks of Franklin Templeton Mutual Funds

1. Market Risk: Like any investment, mutual funds are subject to market risk. The value of mutual funds can fluctuate based on changes in the market, which can lead to losses.
2. Management Risk: While professional management is a benefit of investing in Franklin Templeton mutual funds, it also carries a risk. Poor investment decisions or changes in fund management can lead to underperformance and loss of investment value.
3. Fees: Mutual funds charge fees, including management fees and other expenses. These fees can eat into investment returns over time, so it’s important to carefully consider the fees associated with each mutual fund before investing.

Franklin Templeton mutual funds offer a range of benefits and risks for investors. While diversification, professional management, and flexibility are among the benefits, market risk, management risk, and fees are among the potential downsides.

As with any investment, it’s important to carefully consider your investment goals and risk tolerance before investing in Franklin Templeton mutual funds or any other mutual fund company. Additionally, it’s important to regularly review your investment portfolio and make adjustments as needed to ensure your investments align with your long-term financial goals.

Mutual funds and ETFs

Franklin Templeton has 455 open-ended mutual funds and seven closed-end funds. Included in these are 27 state and federal tax-free income funds, an area of investment pioneered by Franklin.

Prominent funds include the Templeton Growth Fund, Inc. (opened 1954), the Mutual Shares fund (opened 1949), and the Mutual Discovery Fund (opened 1992) and the Templeton Growth (Euro) Fund.

The Franklin Income Fund (FKINX) is a mutual fund in Morningstar’s “conservative allocation” category and “large/value” style box. The fund was created in 1948 and has paid uninterrupted dividends for 60 years. The Franklin Income Fund is constructed primarily of dividend-paying stocks and bonds (2%).

Franklin Templeton launched its first exchange-traded fund (ETF) in 2013. This included 55 active, smart beta and passively managed ETFs in the U.S, with US$9.7 billion in assets under management in 2021.

In 2021, Franklin Templeton launched the first “tokenised” US mutual fund as a pilot – it uses a blockchain to process transactions and record share ownership. The technology is provided by the Stellar network and Blockchain Administrator, a Delaware company. The OnChain US Government Money Fund pilot started with $1.4M of seed money and investment from employees.

The automated administration can trade around the clock and removes the need for brokerages, which should result in a “highly significant decrease in fees”. However, the fund actually has a high level of costs because of its small size and the fact that, as a pilot, it is maintaining traditional records in parallel.

Bottom Line

Franklin Templeton Investments was founded in the 1940s by Rupert H. Johnson Sr. and named after Benjamin Franklin. The company serves individual investors, institutional investors, financial advisors and registered investment advisors. The company has separate websites for the institutional investor and the registered investment advisor. Franklin Templeton serves clients across the globe.​

• Services: Franklin Templeton serves its clientele with a range of investment planning tools including closed-end funds, exchange traded funds, small business retirement plans and separately managed accounts. The company offers solutions for college funding and other life goals.
• Products: Franklin Templeton Investments is home to scores of investment funds representing the cash, equity and fixed income markets Their investments are sold to individuals as well as through financial advisors. Their strategies include multi-asset, alternative and Franklin Templeton solutions.
• Educational and client resources: The company’s “Investor Tools” section is categorized according to investor education, financial conversations and investor behavior. The company also offers calculators, apps and research (insights) reports.
• Investment philosophy: Since 1947, the firm has been dedicated to delivering exceptional asset management for institutional, retail and high-net-worth clients.