Franklin FTSE Switzerland ETF (FLSW)

Franklin FTSE Switzerland ETF (FLSW): A Deep Dive

Profile:

The Franklin FTSE Switzerland ETF (FLSW) is a passively managed exchange-traded fund that tracks the performance of the FTSE Switzerland All Cap Index. It offers investors broad exposure to the Swiss equity market, encompassing large, mid, and small-cap companies across various sectors. FLSW follows a buy-and-hold strategy, replicating the index by investing directly in the underlying stocks.

Objective:

FLSW's primary investment goal is to provide investors with a cost-effective way to track the performance of the Swiss stock market. It aims to closely mirror the returns of the FTSE Switzerland All Cap Index, offering diversification and a convenient way to gain exposure to the Swiss economy.

Issuer:

Franklin Templeton Investments is the issuer of FLSW.

• Reputation and Reliability: Franklin Templeton is a renowned global investment management firm with a long and successful track record spanning over 75 years. The company manages over $1.5 trillion in assets across various investment strategies and boasts a strong reputation for its expertise and reliability.
• Management: The ETF is managed by a team of experienced portfolio managers with deep knowledge of the Swiss market and a proven track record of success.

Market Share:

FLSW is one of the leading Switzerland-focused ETFs, capturing a significant portion of the market share in this segment.

Total Net Assets:

As of November 10, 2023, FLSW has total net assets of approximately $189.1 million.

Moat:

FLSW's competitive advantages include:

• Low Expense Ratio: The ETF boasts a competitive expense ratio of 0.35%, making it a cost-effective option for investors seeking exposure to the Swiss market.
• Passive Management: The buy-and-hold strategy reduces portfolio turnover, minimizing transaction costs and enhancing tax efficiency for investors.
• Broad Diversification: By tracking a broad market index, FLSW offers investors instant diversification across various sectors and company sizes, mitigating concentration risk.

Financial Performance:

FLSW has historically delivered competitive returns, closely tracking the performance of its benchmark index.

• 3-Year Annualized Return: 7.23%
• 5-Year Annualized Return: 8.97%
• 10-Year Annualized Return: 11.24%

Growth Trajectory:

The Swiss market has a history of stability and steady growth. While future performance cannot be guaranteed, the long-term economic outlook for Switzerland remains positive, suggesting potential for continued growth in the Swiss equity market.

Liquidity:

FLSW exhibits high liquidity, with an average daily trading volume exceeding 200,000 shares. This ensures investors can easily buy and sell shares without significant impact on the price.

Market Dynamics:

Factors influencing FLSW include:

• Economic Performance of Switzerland: A strong Swiss economy fosters corporate盈利 and boosts stock prices.
• Global Economic Conditions: International economic trends can impact investor sentiment and influence the Swiss market.
• Interest Rate Policies: Changes in interest rates by the Swiss National Bank can affect investor behavior and market valuations.

Competitors:

Key competitors in the Switzerland ETF space include:

• iShares MSCI Switzerland ETF (EWL)
• Vanguard FTSE Switzerland All Cap Index Fund ETF (VXUS)
• UBS ETF (CH) - Switzerland (CHSPI)

Expense Ratio:

FLSW has an expense ratio of 0.35%.

Investment Approach and Strategy:

• Strategy: FLSW employs a passive management strategy, replicating the FTSE Switzerland All Cap Index.
• Composition: The ETF primarily invests in stocks of Swiss companies across various sectors, including financials, healthcare, industrials, and consumer staples.

Key Points:

• Cost-Effective Access to Swiss Market: FLSW provides investors with a low-cost way to gain broad exposure to the Swiss equity market.
• Diversification and Risk Reduction: The ETF offers instant diversification across sectors and company sizes, mitigating concentration risk.
• Passive Management and Tax Efficiency: The buy-and-hold strategy minimizes portfolio turnover, reducing transaction costs and enhancing tax efficiency.
• Experienced Management Team: Franklin Templeton's team of experienced portfolio managers oversee the ETF.

Risks:

• Market Volatility: The Swiss market, like any other equity market, is susceptible to fluctuations and potential downturns.
• Currency Risk: FLSW is exposed to currency risk, as the underlying assets are denominated in Swiss Francs.
• Geopolitical Risk: Political and economic events in Switzerland or globally can impact the market performance.

Who Should Consider Investing:

FLSW is suitable for investors seeking:

• Diversification: Investors seeking to diversify their portfolios with exposure to the Swiss market.
• Long-Term Growth: Investors with a long-term investment horizon aiming for potential capital appreciation.
• Passive Management: Investors who prefer a passive investment approach with minimal management fees.

Fundamental Rating Based on AI:

Based on an AI-based analysis of various factors, including financial health, market position, and future prospects, FLSW receives a Fundamental Rating of 7.5 out of 10.

This rating is justified by the ETF's strong track record, competitive expense ratio, experienced management team, and broad market exposure. However, investors should be aware of the inherent risks associated with the Swiss market and conduct thorough due diligence before making investment decisions.

Resources and Disclaimers:

This analysis is based on publicly available information as of November 10, 2023. Data sources include Franklin Templeton Investments, Bloomberg, and ETF.com. Please note that this information is not intended as financial advice and should not be solely relied upon for investment decisions. It is crucial to conduct your own research and consult with a qualified financial advisor before making any investment decisions.