FLQS Profile
The Franklin U.S. Small Cap Multifactor Index ETF aims to achieve its investment objectives by allocating at least 80% of its total assets to the securities comprising its underlying index. This index is a customized version of the Russell 2000 Index, enhanced through a specialized methodology developed in partnership with Franklin Templeton. This methodology is crafted to embody Franklin Templeton's strategic investment approach, which focuses on capturing the unique growth potential and characteristics of small-cap U.S. stocks.
The Russell 2000 Index serves as a benchmark for the performance of small-cap U.S. companies, representing a broad cross-section of industries and sectors within the small-cap segment. This index includes companies that are smaller in terms of market capitalization compared to their mid- and large-cap counterparts. By investing in this index, the Franklin U.S. Small Cap Multifactor Index ETF provides exposure to a diverse range of small-sized companies, which are often associated with higher growth potential and emerging business opportunities.
Franklin Templetons multifactor investment approach applied to the index integrates several key financial metrics, including value, momentum, quality, and low volatility. This methodology is designed to enhance the ETFs performance by selecting stocks that exhibit these favorable attributes, potentially providing a superior risk-return profile compared to a traditional market-cap-weighted index. The approach aims to identify small-cap stocks that demonstrate strong financial health, growth potential, and resilience, offering investors a targeted exposure to high-potential equities within the small-cap space.
Investors in the Franklin U.S. Small Cap Multifactor Index ETF benefit from a structured and systematic investment strategy that seeks to leverage the growth opportunities inherent in the small-cap segment. The ETF is managed with a focus on maintaining alignment with the multifactor characteristics of the index, ensuring that it captures the benefits of the chosen investment factors. This approach not only aims to deliver competitive long-term returns but also strives to manage risk through its multifactor selection process, providing a balanced investment option in the small-cap equity market.
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