Industry Updates

Franklin Templeton to add quality overlay to two dividend ETFs

The three ETFs concerned launched in 2017

Jamie Gordon

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Franklin Templeton is set to add a quality factor overlay to two dividend ETFs and cut fees on the vanilla and socially responsible investing (SRI) iterations of its global dividend products.

The $49m Franklin Global Dividend UCITS ETF (FLXX) and $53m Franklin European Dividend UCITS ETF (FLXD) will be renamed the Franklin Global Quality Dividend UCITS ETF and Franklin European Quality Dividend UCITS ETF, respectively, effective “on or about” 1 August.

The firm said: “The rationale behind the changes in names is primarily to align with the naming convention of Franklin Templeton dividend ETFs in other regions and will create further clarity on the inclusion of the quality factor within the investment process of the two sub-funds which remains unchanged.”

Both ETFs track Liberty Q dividend indices which select stocks from their respective MSCI ex-REIT equity universes before applying dividend persistence and yield screens and a quality screen. 

Also from 1 August, FLXX and the $25m Franklin Global Equity SRI UCITS ETF (FLXG) will have their total expense ratios (TERs) cut to 0.30% from 0.45% and 0.40%, respectively. 

FLXD’s fee will remain unchanged at 0.25%.

Earlier this month, the firm broadened its thematic ETF range with the launch of United Nations Sustainable Development Goal-linked (UN SDG) Franklin Future of Food UCITS ETF (FOFD) and Franklin Future of health and Wellness UCITS ETF (FOHW).

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