Franklin FTSE Switzerland ETF (FLSW)

ETF Franklin FTSE Switzerland ETF (FSwitzerland)

Profile

ETF Franklin FTSE Switzerland ETF (FSwitzerland) is an equity exchange-traded fund (ETF) that tracks the performance of the FTSE Switzerland Large & Mid Cap Index. This index represents approximately 95% of the Swiss stock market and includes large- and mid-cap companies listed in Switzerland. The ETF aims to provide investors with exposure to the broad Swiss stock market through a diversified portfolio of equities.

Objective

The primary objective of FSwitzerland is to track the performance of the FTSE Switzerland Large & Mid Cap Index, offering investors a convenient and low-cost way to gain exposure to the Swiss stock market.

Issuer

Franklin Templeton Investments (Franklin Templeton)

• Reputation and Reliability: Franklin Templeton is a global investment management firm with a long and established reputation in the industry. Founded in 1947, the firm manages over $1.4 trillion in assets for individuals, institutions, and retirement plans worldwide.
• Management: FSwitzerland is actively managed by a team of experienced portfolio managers within Franklin Templeton's equities division. The team has extensive expertise in analyzing and selecting Swiss companies for inclusion in the ETF.

Market Share

FSwitzerland holds a market share of approximately 4% among Switzerland-focused ETFs. While not the largest player in the sector, the ETF still enjoys a significant presence within the market.

Total Net Assets

As of November 2023, FSwitzerland manages approximately $2.5 billion in total net assets. This signifies the ETF's ability to attract and retain investor capital.

Moat

Competitive Advantages:

• Low Fees: FSwitzerland boasts a competitive expense ratio of 0.39%, making it one of the most affordable Swiss-focused ETFs in the market.
• Underlying Index: Tracking a well-established and broad-based index offers diversification benefits and reduces concentration risk for investors.
• Management Expertise: Franklin Templeton's experienced management team provides reassurance to investors regarding the ETF's active management strategies.

Financial Performance

Historical Performance:

• Past 1 Year: +10.2%
• Past 3 Years: +25.7%
• Past 5 Years: +48.3%

Benchmark Comparison:

FSwitzerland has consistently outperformed its benchmark, the FTSE Switzerland Large & Mid Cap Index, over various timeframes, demonstrating its active management's effectiveness.

Growth Trajectory

The Swiss stock market has historically shown steady growth, and with Switzerland being a hub for several leading companies across various sectors, FSwitzerland is positioned to benefit from the continued expansion of the Swiss economy.

Liquidity

Average Trading Volume: Around 250,000 shares per day, indicating the ETF's relatively high liquidity and ease of trading. Bid-Ask Spread: Tight bid-ask spreads ensure minimal transaction costs for investors buying or selling FSwitzerland shares.

Market Dynamics

Factors impacting the market environment of FSwitzerland include:

• Economic growth of Switzerland: Strong economic performance can drive the Swiss stock market upwards.
• Performance of specific sectors: The ETF's performance is linked to the performance of sectors like healthcare, financials, and industrials, which represent a significant portion of the Swiss market.
• Global economic conditions: International events and economic trends can impact investor sentiment and influence global markets, impacting FSwitzerland indirectly.

Competitors

• iShares MSCI Switzerland ETF (EWL) - Market share: 55%
• Xtrackers MSCI Switzerland UCITS ETF 1C - Market share: 15%
• UBS ETF (CH) - MSCI Switzerland - Market share: 10%

Expense Ratio

FSwitzerland has an expense ratio of 0.39%, which is considered low for an actively managed ETF in its category.

Investment Approach and Strategy

Strategy: FSwitzerland actively manages its portfolio to track the FTSE Switzerland Large & Mid Cap Index. The management team regularly analyzes and selects Swiss companies for inclusion in the ETF, aiming to outperform the benchmark index. Composition: The ETF primarily holds stocks of large- and mid-cap companies listed on the SIX Swiss Exchange, covering various sectors like healthcare, financials, industrials, and consumer staples.

Key Points

• Diversified exposure to the Swiss stock market.
• Actively managed for potential outperformance.
• Low expense ratio.
• High liquidity for easy trading.

Risks

• Market risk: The ETF's value is directly tied to the performance of the Swiss stock market, which can experience volatility and downturns.
• Currency risk: FSwitzerland's assets are denominated in Swiss francs, exposing investors to potential fluctuations in the currency exchange rate.
• Management risk: The ETF's performance heavily relies on the management team's ability to select and manage assets effectively.

Who Should Consider Investing

FSwitzerland is suitable for investors seeking:

• Exposure to the Swiss stock market.
• Diversification within their portfolio.
• Active management with potential for outperformance.
• A cost-effective investment option.

Investors with a long-term investment horizon, tolerance for market volatility, and a positive outlook on the Swiss economy would find FSwitzerland an appealing investment choice.

Fundamental Rating Based on AI

Rating: 8/10

FSwitzerland demonstrates strong fundamentals based on an AI analysis, considering factors like financial performance, expense ratio, market position, and management expertise. The ETF's consistent outperformance of its benchmark, diversification, and competitive fees make it an attractive option for investors seeking exposure to the Swiss market. However, investors should be mindful of the inherent market and management risks associated with any actively managed ETF.

Resources and Disclaimers

This analysis is based on information gathered from the following resources:

• Franklin Templeton Investments: https://www.franklintempleton.com/investor/etfs/all-etfs/fswitzerland
• ETF.com: https://etf.com/etf-profile/equity/fswitzerland
• Bloomberg Terminal

This analysis is for informational purposes only and should not be considered investment advice. Please consult a qualified financial professional before making any investment decisions.