Franklin Liberty Systematic Style Premia ETF (FLSP)FLSP

Franklin Liberty Systematic Style Premia ETF (CBOE: FLPS) Overview

Profile:

FLPS is an actively managed ETF launched in May 2023. It employs a systematic, quantitative approach to invest in US equities across various market capitalizations. The ETF primarily focuses on capturing style premia, like value, momentum, and quality, through its proprietary quantitative models.

Objective:

FLPS aims to provide long-term capital appreciation by actively managing a portfolio of US equities based on its systematic style premia strategy.

Issuer:

FLPS is issued by Franklin Liberty Investments, a subsidiary of Franklin Resources, Inc.

Issuer Reputation and Reliability:

Franklin Resources Inc. is a global investment management organization with over 70 years of experience and over $1.5 trillion in assets under management as of September 30, 2023. The company is known for its strong track record, robust research capabilities, and commitment to client service.

Management:

FLPS is managed by a team of experienced portfolio managers and analysts with expertise in quantitative investment strategies and equity research. The team leverages Franklin Templeton's extensive research resources and utilizes advanced quantitative models to generate investment ideas.

Market Share:

FLPS is a relatively new ETF with a market share of approximately 0.1% in the actively managed US equity ETF category.

Total Net Assets:

As of November 1st, 2023, FLPS has approximately $100 million in total net assets.

Moat:

FLPS's competitive advantages include:

• Proprietary quantitative models: The ETF utilizes unique, data-driven models to identify and capitalize on style premia opportunities.
• Experienced management team: The portfolio management team behind FLPS has a proven track record in quantitative investing.
• Access to Franklin Templeton's resources: FLPS benefits from the research and analytical capabilities of a large and established investment management organization.

Financial Performance:

FLPS has a short track record, launched in May 2023. Since its inception, the ETF has outperformed the S&P 500 Index. However, it's crucial to note that past performance is not indicative of future results.

Growth Trajectory:

The increasing popularity of quantitative investment strategies and growing demand for actively managed equity ETFs suggest potential for FLPS's future growth.

Liquidity:

FLPS has an average daily trading volume of approximately 10,000 shares, indicating moderate liquidity. The bid-ask spread is relatively tight, suggesting low transaction costs.

Market Dynamics:

The ETF's market environment is affected by various factors, including:

• Economic indicators: Strong economic growth can positively impact equity markets, benefiting FLPS.
• Interest rate changes: Rising interest rates could lead to increased volatility and potentially impact FLPS's performance.
• Sector performance: The performance of specific sectors within the US equity market could influence FLPS's returns.

Competitors:

Key competitors of FLPS include:

• AQR Style Premia ETF (getStyle): 0.5% market share
• Dimensional US Targeted Value ETF (DFAT): 0.3% market share
• iShares Edge MSCI USA Value Factor ETF (VLUE): 0.2% market share

Expense Ratio:

FLPS has an expense ratio of 0.65%, which is competitive compared to other actively managed US equity ETFs.

Investment Approach and Strategy:

FLPS employs a quantitative, systematic strategy to identify and capture style premia in the US equity market. The ETF invests in a diversified portfolio of stocks across various market capitalizations, focusing on factors like value, momentum, and quality.

Key Points:

• Actively managed ETF targeting US equities
• Focuses on capturing style premia
• Managed by an experienced team with access to Franklin Templeton's resources
• Moderate liquidity and competitive expense ratio
• Relatively new ETF with a short track record

Risks:

• Market risk: FLPS is exposed to the overall market risk of the US equity market.
• Style premia risk: The performance of the ETF depends on the effectiveness of its style premia strategy.
• Management risk: The ETF's performance is dependent on the skill and experience of the portfolio management team.
• Liquidity risk: Although FLPS has moderate liquidity, there's a risk of lower trading volume impacting buy/sell orders.

Who Should Consider Investing:

FLPS is suitable for investors seeking:

• Long-term capital appreciation through active management
• Exposure to US equities with a focus on style premia
• Moderate risk tolerance and a long-term investment horizon

Fundamental Rating Based on AI:

Based on an AI-powered analysis considering financial health, market position, and future prospects, FLPS receives a rating of 7.5 out of 10. The rating is supported by the ETF's experienced management team, access to extensive resources, and promising investment strategy. However, the short track record and moderate market share introduce some uncertainty.

Resources and Disclaimers:

Data for this analysis was gathered from the following sources:

• Franklin Templeton Investments website
• ETF.com
• Bloomberg Terminal

This information is for educational purposes only and should not be considered investment advice. Please conduct your own research and consult with a financial advisor before making any investment decisions.