So Franklin Templeton just launched two new ETFs, and before you roll your eyes at yet another fund company trying to grab your money, hear me out – these actually seem pretty solid.
Meet the Franklin Dividend Growth ETF (FRIZ) and the Franklin Multisector Income ETF (MULT). Yeah, I know, the names are about as exciting as watching paint dry, but stick with me here.
The Dividend Play That Doesn’t Suck
FRIZ is basically Franklin’s attempt at finding companies that don’t just pay dividends, but actually grow them over time. Think of it as the difference between a friend who always borrows $20 and never pays you back versus one who starts by borrowing $20, then $25, then $30 – except in this case, they’re actually paying you more each time.
The fund targets “financially sound, high-conviction U.S. companies” – which is finance-speak for “companies that probably won’t implode next Tuesday.” They’re looking for businesses with sustainable competitive advantages, which basically means companies that have figured out how to make money while everyone else is still trying to copy their homework.
What’s cool is they’re not just buying the usual suspects. They’re mixing different company sizes and sectors, so you’re not putting all your eggs in the “big tech dividend” basket (spoiler alert: that basket is pretty small anyway).
The Bond Fund That Actually Tries
Now MULT is where things get interesting. This is Franklin’s “we’ll buy bonds from literally everywhere” fund. Corporate debt, government bonds, emerging markets – they’re basically the bond equivalent of that friend who orders one of everything at a restaurant.
In today’s weird interest rate environment, having a fund that can pivot between different types of bonds isn’t just smart – it’s necessary. When the Fed is playing musical chairs with rates and nobody knows where they’ll land, you want managers who can actually, you know, manage.
Mike Salm, one of the portfolio managers, said they’re focused on “outcomes” in a market full of “crosscurrents.” Translation: “We’re trying to make you money while everything else is going sideways.”
Why This Matters
Here’s the thing – active ETFs are having a moment. People are realizing that sometimes you actually want humans making decisions instead of just buying whatever’s in an index. Shocking, I know.
Franklin Templeton now has 137 ETFs managing $47 billion, which means they’re not exactly new to this game. The team running FRIZ also manages their Rising Dividends mutual fund, so they’ve got some track record to point to.
Both funds offer the transparency and efficiency of ETFs with the flexibility of active management. It’s like having your cake and eating it too, except the cake might actually make you money.
Bottom line: In a world where most new ETFs are just repackaged versions of the same old stuff, these two actually seem to serve a purpose. Whether they’ll deliver on that purpose? Well, that’s what makes investing fun, right?