FLCH Profile
The Franklin FTSE China ETF is designed to provide investors with targeted exposure to the performance of the Chinese equity market, focusing on large- and mid-cap stocks. Under normal market conditions, the fund commits at least 80% of its assets to securities that are constituents of the FTSE China Index, as well as depositary receipts representing these securities. This approach ensures that the ETF mirrors the index’s performance, offering investors a strategic entry point into China's major publicly traded companies.
The FTSE China Index, the benchmark for this ETF, encompasses a broad spectrum of Chinese stocks, including H-Shares, B-Shares, and A-Shares. H-Shares are shares of Chinese companies listed on the Hong Kong Stock Exchange, B-Shares are listed on Chinese exchanges but are available for foreign investors, and A-Shares are shares of Chinese companies listed on the Shanghai and Shenzhen stock exchanges. The index is designed to reflect the performance of large- and mid-cap stocks across these various categories, providing a comprehensive view of China’s equity market.
The fund’s non-diversified status indicates a focus on a select number of stocks, potentially resulting in a higher concentration of investments compared to more broadly diversified funds. This approach allows for a concentrated investment in key sectors of the Chinese economy, which can enhance returns based on the performance of leading companies. Key sectors typically include technology, consumer discretionary, financials, and industrials, each playing a critical role in China's economic growth.
Investors in the Franklin FTSE China ETF are able to tap into the growth potential of China’s major companies, benefiting from the dynamic economic environment of one of the world’s largest and fastest-growing markets. However, the concentrated investment strategy and exposure to China’s market fluctuations entail certain risks. This fund is well-suited for investors seeking to capitalize on China’s economic expansion while understanding the associated market volatility and sector-specific risks.
|
