FLMB Profile
The Franklin Municipal Green Bond ETF is designed to provide investors with exposure to municipal securities while focusing on environmental sustainability. Under normal market conditions, the fund allocates at least 80% of its net assets to municipal securities that offer interest exempt from federal income taxes, including the federal alternative minimum tax (AMT). This strategy is aimed at delivering tax-efficient income to investors, making it particularly attractive for those in higher tax brackets seeking municipal bond exposure.
The fund specifically targets municipal green bonds, which are issued to finance projects with positive environmental impacts, such as renewable energy, clean water, and sustainable infrastructure. By concentrating on green municipal securities, the fund aligns with growing investor interest in socially responsible and environmentally conscious investments. These bonds are issued by state and local governments and their agencies to support projects that contribute to environmental sustainability and climate resilience.
Although the fund’s primary objective is to invest in tax-free municipal securities, there is a provision allowing up to 20% of the fund's net assets to be invested in securities with interest that may be subject to federal alternative minimum tax or other federal or state income taxes. This flexibility enables the fund to maintain a diversified portfolio while navigating the nuances of tax regulations and market conditions.
Managed by Franklin Templeton, the ETF benefits from the firm’s extensive expertise in municipal bond markets and environmental finance. The management team employs a rigorous selection process to ensure that the fund’s investments meet both tax-exemption criteria and green investment standards. This approach aims to deliver competitive returns while supporting environmentally beneficial projects and adhering to high standards of tax efficiency.
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