Franklin Templeton Fixed Income Group. Franklin Templeton Investment Funds Franklin Asia Credit Fund - I (acc) USD. Data as of 30 November 2018

Transcription

1 Franklin Templeton Fixed Income Group Data as of 30 November 2018 Franklin Templeton Investment Funds - I (acc) USD

2 Table of Contents Summary...3 What are the Key Risks?...4 Discrete Performance... 5 Historical Performance...6 Calendar Year Returns...7 Performance Risk Statistics... 8 Duration Contribution by Currency... 9 Duration Contribution by Country Portfolio Characteristics...11 Geographic Allocation...12 Currency Allocation...13 Sector Allocation...14 Credit Quality Allocation...15 Maturity Allocation...16 Top Ten Holdings...17 Duration Breakdown Coupon Allocation...19 Glossary...20 Important Disclosures

3 Summary - I (acc) USD Morningstar Category Investment Style Asia Bond Fixed Income Fund Inception Date 17 November 2014 Share Class Inception Date 17 November 2014 Benchmark Base Currency for Fund Base Currency for Share Class JP Morgan Asia Credit Index USD USD Total Net Assets (USD) 8,291, Asset Allocation Fixed Income: 95.84% Number of Holdings 46 Total Expense Ratio 0.95% Cash & Cash Equivalents: 4.16% Summary of Investment Objective The Fund seeks to maximise total investment return through a combination of interest income and capital appreciation by investing primarily in USD-denominated fixed and/or floating rate debt securities domiciled in Asian countries. Portfolio Manager(s) Marc Kremer, CFA Latika Signorelli Robert Nelson, CFA Benjamin Cryer, CFA Fund Identifiers ISIN Code SEDOL Code Bloomberg Code United States United States United Kingdom United States LU BSMT204 FTFACIA LX Fund Ratings (30 November 2018) Overall Morningstar Rating «««Morningstar, Inc All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Percentage may not total 100% due to rounding. The fund offers other share classes subject to different fees and expenses, which will affect their performance. Please see the prospectus for details. Past performance is not an indicator or a guarantee of future performance. 3

4 What are the Key Risks? The value of shares in the Fund and income received from it can go down as well as up and investors may not get back the full amount invested. Performance may also be affected by currency fluctuations. Currency fluctuations may affect the value of overseas investments. The Fund invests mainly in fixed or floating rate debt securities of government, government-related, or corporate entities located in Asia, including securities that are rated less than investment grade. Such securities have historically been subject to price movements, generally due to interest rates or movements in the bond market in general. As a result, the performance of the Fund can fluctuate moderately over time. Other significant risks include: credit risk, derivatives risk, emerging markets risk, liquidity risk. For full details of all of the risks applicable to this Fund, please refer to the Risk Considerations section of the Fund in the current prospectus of Franklin Templeton Investment Funds. 4

5 Discrete Performance - I (acc) USD Discrete Annual Performance (%) Inception Date - I (acc) USD Net of Fees N/A JP Morgan Asia Credit Index N/A 11/17 11/18 11/16 11/17 11/15 11/16 11/14 11/15 11/13 11/14 All performance data shown is in the Fund currency stated and net of management fees. Sales charges and other commissions, taxes and other relevant costs paid by the investor are not included in the calculations. Performance data may represent blended share class performance, e.g., hybrid created from an A (dis) share class which was converted to A (acc). The fund offers other share classes subject to different fees and expenses, which will affect their performance. Please see the prospectus for details. When performance for either the portfolio or its benchmark has been converted, different foreign exchange closing rates may be used between the portfolio and its benchmark. The value of shares in the Fund and income received from it can go down as well as up, and investors may not get back the full amount invested. Past performance is not an indicator or a guarantee of future performance. Current performance may differ from figures shown. Currency fluctuations may affect the value of overseas investments. When investing in a fund denominated in a foreign currency, performance may also be affected by currency fluctuations. Please visit franklintempleton.lu for current performance. 5

6 Historical Performance - I (acc) USD Annualised Performance (%) Inception Date 1 Yr 3 Yrs Since Incept - I (acc) USD Net of Fees JP Morgan Asia Credit Index Cumulative Performance (%) Inception Date 1 Mth 3 Mths YTD 1 Yr 3 Yrs - I (acc) USD Net of Fees JP Morgan Asia Credit Index Since Incept All performance data shown is in the Fund currency stated and net of management fees. Sales charges and other commissions, taxes and other relevant costs paid by the investor are not included in the calculations. Performance data may represent blended share class performance, e.g., hybrid created from an A (dis) share class which was converted to A (acc). The fund offers other share classes subject to different fees and expenses, which will affect their performance. Please see the prospectus for details. When performance for either the portfolio or its benchmark has been converted, different foreign exchange closing rates may be used between the portfolio and its benchmark. The value of shares in the Fund and income received from it can go down as well as up, and investors may not get back the full amount invested. Past performance is not an indicator or a guarantee of future performance. Current performance may differ from figures shown. Currency fluctuations may affect the value of overseas investments. When investing in a fund denominated in a foreign currency, performance may also be affected by currency fluctuations. Please visit franklintempleton.lu for current performance. 6

7 Calendar Year Returns - I (acc) USD 11% % % % -5% YTD I (acc) USD Net of Fees JP Morgan Asia Credit Index All performance data shown is in the Fund currency stated and net of management fees. Sales charges and other commissions, taxes and other relevant costs paid by the investor are not included in the calculations. Performance data may represent blended share class performance, e.g., hybrid created from an A (dis) share class which was converted to A (acc). The fund offers other share classes subject to different fees and expenses, which will affect their performance. Please see the prospectus for details. When performance for either the portfolio or its benchmark has been converted, different foreign exchange closing rates may be used between the portfolio and its benchmark. The value of shares in the Fund and income received from it can go down as well as up, and investors may not get back the full amount invested. Past performance is not an indicator or a guarantee of future performance. Current performance may differ from figures shown. Currency fluctuations may affect the value of overseas investments. When investing in a fund denominated in a foreign currency, performance may also be affected by currency fluctuations. Please visit franklintempleton.lu for current performance. 7

8 Performance Risk Statistics - I (acc) USD Performance Risk Statistics 1 Yr 3 Yrs* Standard Deviation (%): - I (acc) USD JP Morgan Asia Credit Index Tracking Error (%)^^ Information Ratio^^ Beta^^ Sharpe Ratio The base currency of a fund determines the risk-free rate index used in calculating certain risk statistics on this page. A fund that is based in USD uses the US T-Bill Index as the risk free rate return, a EUR-based fund uses the Euro 3-Month T-Bill Index, a GBP-based fund uses the UK Treasury Bills 3 Month Index, a JPY-based fund uses the Japan Financing Bill 3 Month Index, and an AUD-based fund uses the Australia T-Note 3 Month Index. When performance for either the portfolio or its benchmark has been converted, different foreign exchange closing rates may be used between the portfolio and its benchmark. ^^Measured against the JP Morgan Asia Credit Index. *Annualised. Past performance is not an indicator or a guarantee of future performance. 8

9 Duration Contribution by Currency vs. JP Morgan Asia Credit Index Portfolio (Yrs) Index (Yrs) Over/Under (Yrs) U.S. Dollar Indian Rupee U.S. Dollar Indian Rupee Yrs JP Morgan Asia Credit Index 9

10 Duration Contribution by Country vs. JP Morgan Asia Credit Index Asia ex-japan Non-EMU Europe EMU Europe United States Latin America / Caribbean Portfolio (Yrs) Index (Yrs) Over/Under (Yrs) Asia ex-japan China Indonesia India South Korea Singapore Thailand Philippines Hong Kong Malaysia Sri Lanka Macau Pakistan Mongolia Taiwan Vietnam Non-EMU Europe Switzerland United Kingdom EMU Europe Ireland United States Latin America / Caribbean Cayman Islands Yrs JP Morgan Asia Credit Index 10

11 Portfolio Characteristics vs. JP Morgan Asia Credit Index Portfolio Average Credit Quality BBB BBB+ Average Duration 4.18 Yrs 4.35 Yrs Average Weighted Maturity 5.60 Yrs 7.62 Yrs Yield to Maturity 5.70% 5.52% Yield to Worst 5.63% 5.54% Index The average credit quality (ACQ) rating may change over time. The portfolio itself has not been rated by an independent rating agency. The letter rating, which may be based on bond ratings from different agencies (or internal ratings for unrated bonds, cash and equivalents), is provided to indicate the average credit rating of the portfolio's underlying investments and generally ranges from AAA (highest) to D (lowest). For unrated bonds, cash and equivalents, ratings may be assigned based on the ratings of the issuer, the ratings of the underlying holdings of a pooled investment vehicle, or other relevant factors. The ACQ is determined by assigning a sequential integer to all credit ratings AAA to D, taking a simple, asset-weighted average of investments by market value and rounding to the nearest rating. The risk of default increases as a bond's rating decreases, so the ACQ provided is not a statistical measurement of the portfolio s default risk because a simple, weighted average does not measure the increasing level of risk from lower-rated bonds. The ACQ may be lower if cash and equivalents are excluded from the calculation. The ACQ is provided for informational purposes only. Derivative positions are not reflected in the ACQ. Yield figures quoted should not be used as an indication of the income that has or will be received. Yield figures are based on the portfolio's underlying holdings and do not represent a payout of the portfolio. 11

12 Geographic Allocation vs. JP Morgan Asia Credit Index Asia ex-japan Non-EMU Europe EMU Europe United States Latin America / Caribbean Cash & Cash Equivalents 0% 25% 50% 75% 100% Portfolio % Index % Over/Under % ASIA ASIA EX-JAPAN China India Indonesia South Korea Hong Kong Thailand Philippines Singapore Malaysia Sri Lanka Macau Pakistan Mongolia Taiwan Vietnam Cambodia EUROPE NON-EMU EUROPE United Kingdom Switzerland EMU EUROPE Ireland NORTH AMERICA UNITED STATES LATIN AMERICA / CARIBBEAN Cayman Islands CASH & CASH EQUIVALENTS JP Morgan Asia Credit Index Weightings as percent of total. Percentage may not total 100% due to rounding. 12

13 Currency Allocation vs. JP Morgan Asia Credit Index Portfolio % Index % Over/Under % NORTH AMERICA U.S. DOLLAR ASIA ASIA EX-JAPAN Indian Rupee U.S. Dollar Indian Rupee 0% 20% 40% 60% 80% 100% JP Morgan Asia Credit Index Weightings as percent of total. Percentage may not total 100% due to rounding. 13

14 Sector Allocation vs. JP Morgan Asia Credit Index Financial Real Estate Utilities Quasi-Sovereign Oil & Gas Industrial Tech, Media, and Telecom Chemicals Infrastructure Consumer Portfolio % Index % Over/Under % Financial Real Estate Utilities Quasi-Sovereign Oil & Gas Industrial Tech, Media, and Telecom Chemicals Infrastructure Consumer Metals & Mining Sovereign Diversified Transportation Cash & Cash Equivalents Metals & Mining Sovereign Diversified Transportation Cash & Cash Equivalents 0% 7% 14% 21% 28% 35% JP Morgan Asia Credit Index Weightings as percent of total. Percentage may not total 100% due to rounding. 14

15 Credit Quality Allocation vs. JP Morgan Asia Credit Index AAA AA A BBB BB B CCC Portfolio % Index % Over/Under % AAA AA A BBB BB B CCC CC NR Cash Investment Grade Non-Investment Grade Cash CC NR Cash 0% 15% 30% 45% 60% JP Morgan Asia Credit Index Weightings as percent of total. Percentage may not total 100% due to rounding. Ratings shown are assigned by one or more Nationally Recognised Statistical Rating Organisations ('NRSRO'), such as Standard & Poor's, Moody's and Fitch. The ratings are an indication of an issuer's creditworthiness and typically range from AAA or Aaa (highest) to D (lowest). When ratings from all three agencies are available, the middle rating is used; when two are available, the lowest rating is used; and when only one is available, that rating is used. Foreign government bonds without a specific rating are assigned the country rating provided by an NRSRO, if available. The NR category consists of rateable securities that have not been rated by an NRSRO. Cash includes equivalents, which may be rated. 15

16 Maturity Allocation vs. JP Morgan Asia Credit Index 0 to 1 Year 1 to 2 Years 2 to 3 Years 3 to 5 Years 5 to 7 Years Portfolio % Index % Over/Under % 0 to 1 Year to 2 Years to 3 Years to 5 Years to 7 Years to 10 Years to 15 Years to 20 Years to 30 Years Years to 10 Years 10 to 15 Years 15 to 20 Years 20 to 30 Years 30+ Years 0% 8% 16% 24% 32% JP Morgan Asia Credit Index Weightings as percent of total. Percentage may not total 100% due to rounding. 16

17 Top Ten Holdings Issuer Name % of Total PERTAMINA PERSERO PT 2.95 GOLDEN LEGACY PTE LTD 2.57 NTPC LTD 2.56 SHIMAO PROPERTY HOLDINGS LTD 2.54 AGILE GROUP HOLDINGS LTD 2.49 MEDCO STRAITS SERVICES PTE LTD 2.44 GC TREASURY CENTER CO LTD 2.44 BANGKOK BANK PCL/HONG KONG 2.43 CHINA OVERSEAS FINANCE CAYMAN 2.43 ICTSI TREASURY BV 2.42 Total The Ten Largest Holdings represent the ten largest holdings of the fund as of the date indicated. These securities do not represent all of the securities purchased, sold or recommended for advisory clients, and the reader should not assume that investment in the securities listed was or will be profitable. All portfolio holdings are subject to change. The portfolio manager for the fund reserves the right to withhold release of information with respect to holdings that would otherwise be included in the top 10 holdings list. 17

18 Duration Breakdown vs. JP Morgan Asia Credit Index 0 to 1 Year 1 to 2 Years 2 to 3 Years Portfolio % Index % Over/Under % 0 to 1 Year to 2 Years to 3 Years to 5 Years to 7 Years to 10 Years to 15 Years to 20 Years to 5 Years 5 to 7 Years 7 to 10 Years 10 to 15 Years 15 to 20 Years 0% 8% 16% 24% 32% JP Morgan Asia Credit Index Weightings as percent of fixed income. Percentage may not total 100% due to rounding. 18

19 Coupon Allocation Coupon 0-1% % % % % % % % % 7% 14% 21% 28% 35% Weightings as percent of total. Percentage may not total 100% due to rounding. 19

20 Glossary Average Credit Quality: The average credit quality reflects the holdings of the underlying issues, based on the size of each holding and ratings assigned to each based on rating agency assessments of its creditworthiness. Average Duration: A measure of the sensitivity of the price (the value of principal) of a fixed-income investment to a change in interest rates. Duration is expressed as a number of years. Average Weighted Maturity: An estimate of the number of years to maturity, taking the possibility of early payments into account, for the underlying holdings. Beta: A measure of the magnitude of a portfolio's past share-price fluctuations in relation to the ups and downs of the overall market (or appropriate market index). The market (or index) is assigned a beta of 1.00, so a portfolio with a beta of 1.20 would have seen its share price rise or fall by 12% when the overall market rose or fell by 10%. Information Ratio: In investing terminology, the ratio of expected return to risk. Usually, this statistical technique is used to measure a manager's performance against a benchmark. This measure explicitly relates the degree by which an investment has beaten the benchmark to the consistency by which the investment has beaten the benchmark. Sharpe Ratio: To calculate a Sharpe ratio, an asset's excess returns (its return in excess of the return generated by risk-free assets such as Treasury bills) are divided by the asset's standard deviation. Standard Deviation: A measure of the degree to which a fund's return varies from the average of its previous returns. The larger the standard deviation, the greater the likelihood (and risk) that a fund's performance will fluctuate from the average return. Tracking Error: Measure of the deviation of the return of a fund compared to the return of a benchmark over a fixed period of time. Expressed as a percentage. The more passively the investment fund is managed, the smaller the tracking error. Yield to Maturity: Yield to Maturity ('YTM') also known as the 'Gross Redemption Yield' or 'Redemption Yield'. The rate of return anticipated on a bond if it is held until the maturity date. YTM is considered a long-term bond yield expressed as an annual rate. The calculation of YTM takes into account the current market price, par value, coupon interest rate and time to maturity. It is also assumed that all coupons are reinvested at the same rate. Yield to Worst: The yield to maturity if the worst possible bond repayment takes place. If market yields are higher than the coupon, the yield to worst would assume no prepayment. If market yields are below the coupon, the yield to worst would assume prepayment. In other words, yield to worst assumes that market yields are unchanged. Normally this value is not aggregated since it varies but if a weighted average value is used for a Fund then the figure will reflect the values of the underlying issues, based on the size of each holding. 20

21 Important Disclosures This document is intended to be of general interest only and does not constitute legal or tax advice nor is it an offer for shares or invitation to apply for shares of the Luxembourg-domiciled SICAV Franklin Templeton Investment Funds (FTIF). Nothing in this document should be construed as investment advice. Opinions expressed are the author's at publication date and they are subject to change without prior notice. Subscriptions to shares of FTIF can only be made on the basis of the current prospectus and where available, the relevant Key Investor Information Document, accompanied by the latest available audited annual report and the latest semi-annual report if published thereafter. The value of shares in FTIF and income received from it can go down as well as up, and investors may not get back the full amount invested. Past performance is not an indicator or a guarantee of future performance. Currency fluctuations may affect the value of overseas investments. When investing in a fund denominated in a foreign currency, your performance may also be affected by currency fluctuations. An investment in FTIF entails risks which are described in FTIF's prospectus and where available, in the relevant Key Investor Information Document. Risks in emerging markets may be higher than in developed markets. Investments in derivative instruments involve specific risks more fully described in the Fund's prospectus. No shares of FTIF may be directly or indirectly offered or sold to residents of the United States of America. Shares of FTIF are not available for distribution in all jurisdictions and prospective investors should confirm availability with their local Franklin Templeton Investments representative before making any plans to invest. Any research and analysis contained in this document has been procured by Franklin Templeton Investments for its own purposes and is provided to you only incidentally. References to particular industries, sectors or companies are for general information and are not necessarily indicative of a fund's holding at any one time. Please consult your financial advisor before deciding to invest. A copy of the latest prospectus and where available, the relevant Key Investor Information Document, the annual report and semi-annual report, if published thereafter can be found, on our website or can be obtained, free of charge, from Franklin Templeton International Services S.à r.l., Succursale Italiana. Issued by Franklin Templeton International Services S.à r.l., Succursale Italiana, Corso Italia, Milano - Tel: Fax: Tool Free number: Franklin Templeton Investments. All rights reserved. CFA and Chartered Financial Analyst are trademarks owned by CFA Institute. Indexes are unmanaged, and one cannot invest directly in an index. They do not reflect any fees, expenses or sales charges. In emerging markets, the risks can be greater than in developed markets. Investments in derivative instruments entail specific risks that may increase the risk profile of the fund and are more fully described in the Fund's prospectus and where available, in the relevant Key Investor Information Document. 21