Franklin Templeton is introducing its first suite of emerging market ETFs to the European market. The four-strong suite will offer investors exposure to Brazil, China, Korea and India.
Franklin FTSE Brazil UCITS ETF (LSE: FVUB)
Franklin FTSE China UCITS ETF (LSE: FRCH)
Franklin FTSE Korea UCITS ETF (LSE: FLRK)
Franklin FTSE India UCITS ETF (LSE: FRIN)
Emerging market ETFs usually come with a more expensive total expense ratio (TER), however, three ETFs charge 0.19% while FLRK has a TER of 0.09%. Similar products from competitors can come with fees in excess of 60bps.
The Brazil, China and Korea ETFs are set to list first on the Deutsche Börse on 5 June, followed by the London Stock Exchange and Borsa Italiana on 7 June and then SIX Swiss Exchange on 19 June. FRIN is set to list shortly after the initial three listings.
Emerging market ETFs had an impressive start to 2019 but has since struggled following ongoing tariff hikes between the US and China. Franklin Templeton said earlier this year earnings needed to improve for its Q1 rally to be sustainable.
Partnering with FTSE Russell, the emerging market ETFs are all market cap weighted. Each ETF tracks their respective regions’ FTSE 30/18 Capped index.
The reasoning behind selecting Brazil, China, Korea and India is because of how the countries represent the biggest country allocations within client portfolios and broad emerging market indices. Responding to client feedback, the range of ETFs will be physically replicated.
Patrick O’Connor, head of global ETFs at Franklin Templeton, said: “This new suite of passive ETFs will provide a cost-effective way to access beta solutions, further rounding out our strong line up of 14 ETF strategies for European investors."
In May, Franklin Templeton was the first asset manager to launch an actively managed euro green bond ETF.
Through its Franklin LibertyShares ETF platform globally, Franklin Templeton currently offers an actively managed suite of equity and fixed income ETFs, passive ETFs and a smart beta suite covering both US and international equity markets. Globally, Franklin LibertyShares has approximately $3.8bn in assets under management as of the end of May.