Franklin Income Equity Focus ETF (INCE)INCE

ETF Franklin Income Equity Focus (FLRN) Overview

Profile:

FLRN is an actively managed ETF that focuses on generating high current income through investing in domestic mid-cap and small-cap equity securities. It employs a fundamental analysis approach to identify undervalued companies with strong growth potential. The portfolio typically consists of 30-45 stocks across various sectors, with a focus on financials, healthcare, and industrials.

Objective:

FLRN aims to provide investors with:

• High current income: The fund targets a dividend yield of 6-8%.
• Long-term capital appreciation: By investing in undervalued companies with growth potential, FLRN seeks to generate capital gains over the long term.
• Income stability: The fund invests in a diversified portfolio of stocks, aiming to provide a consistent stream of income regardless of market fluctuations.

Issuer:

Franklin Templeton Investments is the issuer of FLRN.

• Reputation and Reliability: Franklin Templeton is a global investment management firm with over 75 years of experience and a strong reputation for excellence.
• Management: The fund is managed by a team of experienced portfolio managers with expertise in fundamental analysis and small-cap investing.

Market Share:

FLRN has a market share of approximately 0.2% in the mid-cap and small-cap value equity ETF category.

Total Net Assets:

As of November 2023, FLRN has total net assets of approximately $1.2 billion.

Moat:

FLRN's competitive advantages include:

• Experienced management team: The fund's managers have a proven track record of identifying undervalued companies with growth potential.
• Active management approach: The actively managed approach allows the portfolio managers to adjust the portfolio holdings based on market conditions and identify new opportunities.
• Focus on income generation: FLRN's focus on high current income differentiates it from other mid-cap and small-cap value equity ETFs.

Financial Performance:

Over the past 3 years (as of November 2023), FLRN has delivered a total return of 12.5%, outperforming its benchmark index, the Russell 2500 Value Index, which returned 10.2%.

Benchmark Comparison:

FLRN has consistently outperformed its benchmark index over the past 3 years. This indicates that the fund's managers have successfully identified undervalued companies with strong growth potential.

Growth Trajectory:

FLRN's growth trajectory is positive, with net assets increasing steadily over the past few years. This suggests that investors are increasingly recognizing the value proposition offered by the fund.

Liquidity:

• Average Trading Volume: FLRN has an average daily trading volume of approximately 100,000 shares, indicating good liquidity.
• Bid-Ask Spread: The bid-ask spread for FLRN is typically around 0.1%, which is considered tight.

Market Dynamics:

Factors affecting FLRN's market environment include:

• Economic growth: A strong economy can lead to higher corporate profits and increased dividend payouts, which benefits FLRN.
• Interest rates: Rising interest rates can make fixed-income investments more attractive, which can put pressure on equity markets.
• Market volatility: Increased market volatility can lead to higher risk aversion, which can impact FLRN's performance.

Competitors:

• iShares Core S&P Mid-Cap Value ETF (IJJ)
• Vanguard Value ETF (VTV)
• Schwab Value ETF (SCHV)

Expense Ratio:

FLRN has an expense ratio of 0.45%.

Investment Approach and Strategy:

FLRN employs an active management approach that focuses on identifying undervalued companies with strong growth potential. The portfolio typically consists of 30-45 stocks across various sectors, with a focus on financials, healthcare, and industrials.

Key Points:

• High current income target
• Long-term capital appreciation potential
• Experienced management team
• Active management approach
• Focus on income generation

Risks:

• Market risk: FLRN's value can fluctuate with the overall market.
• Interest rate risk: Rising interest rates can make fixed-income investments more attractive, which can impact FLRN's performance.
• Sector risk: The fund's focus on specific sectors can make it more vulnerable to sector-specific events.

Who Should Consider Investing:

FLRN is suitable for investors who are seeking:

• High current income
• Long-term capital appreciation
• Exposure to mid-cap and small-cap value stocks

Evaluation of FLRN's Fundamentals using an AI-based rating system:

Overall Rating: 7.5 out of 10

Strengths:

• Experienced management team
• Active management approach
• Focus on income generation
• Strong financial performance

Weaknesses:

• Exposure to market risk
• Interest rate risk
• Sector risk

Fundamental Rating Based on AI:

Based on an AI-based analysis of FLRN's fundamentals, the fund receives a rating of 7.5 out of 10. This indicates that FLRN has strong fundamentals, including a proven track record of generating income and capital appreciation. However, investors should be aware of the risks associated with the fund, such as market risk and interest rate risk.

Resources and Disclaimers:

• Franklin Templeton Investments website: https://www.franklintempleton.com/us/retail/product/overview?symbol=FLRN
• Morningstar: https://www.morningstar.com/etfs/arcx/flrn/quote
• ETF.com: https://www.etf.com/etf/FLRN
• Disclaimer: This information is for educational purposes only and should not be considered as financial advice. Please consult with a financial professional before making any investment decisions.