Franklin Templeton Investment Funds Templeton Emerging Markets Bond Fund - A (Qdis) USD

Transcription

1 Templeton Global Macro Group Data as of 30 November 2018 Franklin Templeton Investment Funds - A (Qdis) 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 Country...9 Duration Contribution by Currency Duration Contribution by Sector Portfolio Characteristics...12 Geographic Allocation...13 Currency Exposure...14 Sector Allocation...15 Credit Quality Allocation...16 Maturity Allocation...17 Duration Exposure...18 Glossary...19 Important Disclosures

3 Summary - A (Qdis) USD As of 30 November 2018 Morningstar Category Investment Style Fund Inception Date 5 July 1991 Share Class Inception Date 5 July 1991 Benchmark Base Currency for Fund Base Currency for Share Class UK Reporting Status Global Emerging Markets Bond Fixed Income - Emerging Markets JP Morgan EMBI Global Index USD USD Yes Total Net Assets (USD) 9,774,934, Asset Allocation (Market Value) Fixed Income: 86.50% Number of Holdings 160 Ongoing Charges 1.88% Distribution Yield 10.92% Cash & Cash Equivalents: 13.50% Summary of Investment Objective The Fund aims to maximize total investment return, consisting of a combination of interest income, capital appreciation and currency gains by investing principally in a portfolio of fixed and floating rate debt securities and debt obligations issued by government and government- related issuers or corporate entities located in developing or emerging market countries. Portfolio Manager(s) Michael Hasenstab, PhD Laura Burakreis Sonal Desai, PhD Fund Identifiers ISIN Code LU SEDOL Code Bloomberg Code Fund Ratings (30 November 2018) Overall Morningstar Rating «««United States United States United States TEMEMFI LX Cash represented by cash, invested cash and cash security. 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. The Distribution Yield reflects the amounts that may be expected to be distributed over the next 12 months as a percentage of the mid-market unit price of the fund as at the date shown. It does not include any preliminary charge and investors may be subject to tax on distributions. Market value figures reflect the trading value of the investments. Portfolio breakdown percentages may not total 100% and may be negative due to rounding, use of any derivatives, unsettled trades or other factors. 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 debt securities of any quality issued by entities located in developing and emerging markets. Such securities have historically been subject to price movements, generally due to interest rates, market factors or movements in the bond market. As a result, the performance of the Fund can fluctuate over time. The Fund may distribute income gross of expenses. Whilst this might allow more income to be distributed, it may also have the effect of reducing capital. 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 - A (Qdis) USD As of 30 November 2018 Discrete Annual Performance (%) Inception Date - A (Qdis) USD Net of Fees JP Morgan EMBI Global Index /17 11/18 11/16 11/17 11/15 11/16 11/14 11/15 11/13 11/14 The used the JP Morgan EMBI index as the fund s benchmark from inception until 1993, when it was replaced by the JPM EMBIG which is now the sole benchmark. 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. 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.co.uk for current performance. Past performance is not an indicator or a guarantee of future performance. 5

6 Historical Performance - A (Qdis) USD As of 30 November 2018 Annualised Performance (%) Inception Date 1 Yr 3 Yrs 5 Yrs 10 Yrs - A (Qdis) USD Net of Fees JP Morgan EMBI Global Index Since Incept Cumulative Performance (%) Inception Date 1 Mth 3 Mths YTD 1 Yr 3 Yrs 5 Yrs 10 Yrs - A (Qdis) USD Net of Fees JP Morgan EMBI Global Index , Since Incept The used the JP Morgan EMBI index as the fund s benchmark from inception until 1993, when it was replaced by the JPM EMBIG which is now the sole benchmark. 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. 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.co.uk for current performance. Past performance is not an indicator or a guarantee of future performance. 6

7 Calendar Year Returns - A (Qdis) USD As of 30 November % % % % -20% YTD A (Qdis) USD Net of Fees JP Morgan EMBI Global Index The used the JP Morgan EMBI index as the fund s benchmark from inception until 1993, when it was replaced by the JPM EMBIG which is now the sole benchmark. 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. 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.co.uk for current performance. Past performance is not an indicator or a guarantee of future performance. 7

8 Performance Risk Statistics - A (Qdis) USD As of 30 November 2018 Performance Risk Statistics Standard Deviation (%): - A (Qdis) USD 1 Yr 3 Yrs* 5 Yrs* 10 Yrs* 15 Yrs* 20 Yrs* JP Morgan EMBI Global Index Tracking Error (%)^^ Information Ratio^^ 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 EMBI Global Index. *Annualised. Past performance is not an indicator or a guarantee of future performance. 8

9 Duration Contribution by Country vs. JP Morgan EMBI Global Index As of 30 November 2018 ASIA ASIA EX-JAPAN Indonesia India Thailand MIDDLE EAST / AFRICA Ghana Senegal Ethiopia Kenya EUROPE EMU EUROPE NON-EMU EUROPE AMERICAS NON-US AMERICAS Brazil Colombia Argentina Mexico USA SUPRANATIONAL % 0% 2% Regions Sub-Regions Countries Portfolio Index Over/Under ASIA ASIA EX-JAPAN Indonesia India Thailand China Philippines Kazakhstan Malaysia MIDDLE EAST / AFRICA Ghana Senegal Ethiopia Kenya South Africa Oman Egypt Lebanon Nigeria Republic of Angola Ivory Coast Jordan Morocco Iraq Zambia Gabon Namibia Other EUROPE Portfolio Index Over/Under EMU EUROPE NON-EMU EUROPE Lithuania Slovak Republic Turkey Russia Ukraine Hungary Romania Other AMERICAS NON-US AMERICAS Brazil Colombia Argentina Mexico Chile Peru Panama Uruguay Dominican Republic Ecuador Jamaica Other USA SUPRANATIONAL Figures reflect certain derivatives held in the portfolio (or their underlying reference assets). 9

10 Duration Contribution by Currency vs. JP Morgan EMBI Global Index As of 30 November 2018 ASIA ASIA EX-JAPAN Indonesian Rupiah Indian Rupee Thailand Baht MIDEAST/AFRICA Ghanaian Cedi AMERICAS Portfolio Index Over/Under ASIA ASIA EX-JAPAN Indonesian Rupiah Indian Rupee Thailand Baht MIDEAST/AFRICA Ghanaian Cedi AMERICAS NON-US DOLLAR Brazilian Real Colombian Peso Argentine Peso Mexican Peso U.S. DOLLAR NON-US DOLLAR 1.13 Brazilian Real Colombian Peso Argentine Peso Mexican Peso U.S. DOLLAR % 0% 2% Regions Sub-Regions Currencies Figures reflect certain derivatives held in the portfolio (or their underlying reference assets). 10

11 Duration Contribution by Sector vs. JP Morgan EMBI Global Index As of 30 November 2018 Local Curr. Govt/Agency Bonds Investment Grade Non-Investment Grade Portfolio Index Over/Under Local Curr. Govt/Agency Bonds Investment Grade Non-Investment Grade Non-Local Curr. Sovereign Bonds Non-Investment Grade Investment Grade Supranational Derivatives Non-Local Curr. Sovereign Bonds 0.10 Non-Investment Grade 0.10 Supranational 0.01 Derivatives Yrs Figures reflect certain derivatives held in the portfolio (or their underlying reference assets). 11

12 Portfolio Characteristics vs. JP Morgan EMBI Global Index As of 30 November 2018 Portfolio Average Credit Quality BBB- BB+ Average Duration 0.95 Yrs 6.58 Yrs Average Weighted Maturity 3.24 Yrs Yrs Yield to Maturity 12.60% 6.97% Yield to Worst 12.60% 6.96% Index Average Duration, Average Weighted Maturity, Yield to Maturity and Yield to Worst figures reflect certain derivatives held in the portfolio (or their underlying reference assets). 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. 12

13 Geographic Allocation vs. JP Morgan EMBI Global Index As of 30 November 2018 Market Value AMERICAS NON-US AMERICAS Brazil Argentina Mexico Colombia El Salvador Other USA ASIA ASIA EX-JAPAN India Indonesia Thailand MIDDLE EAST / AFRICA Ghana Egypt Senegal Ethiopia Kenya South Africa Other EUROPE NON-EMU EUROPE Ukraine Other EMU EUROPE SUPRANATIONAL CASH & CASH EQUIVALENTS % 10% 20% 30% 40% 50% Regions Sub-Regions Countries Portfolio % Index % Over/Under % AMERICAS NON-US AMERICAS Brazil Argentina Mexico Colombia El Salvador Chile Ecuador Panama Peru Dominican Republic Venezuela Uruguay Jamaica Costa Rica Other USA ASIA ASIA EX-JAPAN India Indonesia Thailand China Philippines Kazakhstan Malaysia Sri Lanka Other MIDDLE EAST / AFRICA Ghana Egypt Senegal Ethiopia Portfolio % Index % Over/Under % Kenya South Africa Oman Lebanon Nigeria Other EUROPE NON-EMU EUROPE Ukraine Turkey Russia Hungary Poland Croatia Romania Azerbaijan Other EMU EUROPE Other SUPRANATIONAL CASH & CASH EQUIVALENTS Market value figures reflect the trading value of the investments. Portfolio breakdown percentages may not total 100% and may be negative due to rounding, use of any derivatives, unsettled trades or other factors. 13

14 Currency Exposure vs. JP Morgan EMBI Global Index As of 30 November 2018 Notional Exposure AMERICAS NON-US DOLLAR Mexican Peso Brazilian Real Argentine Peso Colombian Peso U.S. DOLLAR MIDEAST/AFRICA Ghanaian Cedi Egyptian Pound ASIA ASIA EX-JAPAN Portfolio % Index % Over/Under % AMERICAS NON-US DOLLAR Mexican Peso Brazilian Real Argentine Peso Colombian Peso U.S. DOLLAR MIDEAST/AFRICA Ghanaian Cedi Egyptian Pound ASIA ASIA EX-JAPAN Indian Rupee Indonesian Rupiah Thailand Baht Australian Dollar JAPANESE YEN EUROPE EURO Indian Rupee Indonesian Rupiah Thailand Baht 4.74 Australian Dollar JAPANESE YEN EUROPE EURO % 5% 27% 49% 71% 93% Regions Sub-Regions Currencies Notional exposure figures are intended to estimate the portfolio s exposure, including any hedged or increased exposure through certain derivatives held in the portfolio (or their underlying reference assets). Portfolio breakdown percentages may not total 100% and may be negative due to rounding, use of any derivatives, unsettled trades or other factors. 14

15 Sector Allocation vs. JP Morgan EMBI Global Index As of 30 November 2018 Market Value Local Curr. Govt/Agency Bonds Investment Grade Non-Investment Grade Non-Local Curr. Sovereign Bonds Portfolio % Index % Over/Under % Local Curr. Govt/Agency Bonds Investment Grade Non-Investment Grade Non-Local Curr. Sovereign Bonds Non-Investment Grade Investment Grade Derivatives Corporate Bonds Non-Investment Grade Supranational Cash & Cash Equivalents Non-Investment Grade 3.48 Derivatives 0.65 Corporate Bonds 0.16 Non-Investment Grade 0.16 Supranational 0.14 Cash & Cash Equivalents % 17% 34% 51% 68% 85% Market value figures reflect the trading value of the investments. Portfolio breakdown percentages may not total 100% and may be negative due to rounding, use of any derivatives, unsettled trades or other factors. 15

16 Credit Quality Allocation vs. JP Morgan EMBI Global Index As of 30 November 2018 Market Value AAA AA- A+ A A- BBB+ BBB BBB- BB+ BB BB- B+ B B- CCC+ CCC C D NR N/A Cash 0% 8% 16% 24% 32% JP Morgan EMBI Global Index Portfolio % Index % Over/Under % AAA AA A A A BBB BBB BBB BB BB BB B B B CCC CCC C D NR N/A Cash Investment Grade Non-Investment Grade N/A Cash Market value figures reflect the trading value of the investments. Portfolio breakdown percentages may not total 100% and may be negative due to rounding, use of any derivatives, unsettled trades or other factors. 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. The N/A category consists of nonrateable securities (e.g., equities). Cash includes equivalents, which may be rated. 16

17 Maturity Allocation vs. JP Morgan EMBI Global Index As of 30 November 2018 Market Value 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% 10% 20% 30% 40% JP Morgan EMBI Global Index Market value figures reflect the trading value of the investments. Portfolio breakdown percentages may not total 100% and may be negative due to rounding, use of any derivatives, unsettled trades or other factors. 17

18 Duration Exposure vs. JP Morgan EMBI Global Index As of 30 November 2018 Notional Exposure 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 -5% 10% 25% 40% 55% JP Morgan EMBI Global Index [Note: cash is included in these calculations under 0-1 Year duration] Notional exposure figures are intended to estimate the portfolio s exposure, including any hedged or increased exposure through certain derivatives held in the portfolio (or their underlying reference assets). Portfolio breakdown percentages may not total 100% and may be negative due to rounding, use of any derivatives, unsettled trades or other factors. 18

19 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. 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. Ongoing Charges: The Ongoing Charges Figure (OCF) is an amount representing all operating charges and expenses of the Fund in the prior 12 months as a percentage of the Fund's average net assets for the period. Where that figure would not be a fair representation of future costs or if 12 months data is not available, an estimated figure will be shown. 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. 19

20 Important Disclosures Source: Franklin Templeton Investments, unless stated otherwise. Fund specific information - performance details provided are in the Fund currency, include reinvested dividends and are net of management fees. Sales charges and other commissions, taxes and other relevant costs to be paid by an investor are not included in the calculations. Past performance is not an indicator or a guarantee of future performance. 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 Franklin Templeton Investment Funds SICAV ( the Fund ). Nothing in this document should be construed as investment advice. Subscriptions to shares of the Fund 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. No shares of the Fund may be directly or indirectly offered or sold to residents of the United States of America. Shares of the Fund 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. 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. 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. All or most of the protections provided by the UK Regulatory System will not apply to Franklin Templeton Investment Funds (SICAV) Investors. An investment in the Fund entails risks which are described in the Fund s prospectus and where available, in the relevant Key Investor Information Document. There is no guarantee that the Fund will achieve its objective. A copy of the latest prospectus, and if available for this product the 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 Investment Management Limited, Cannon Place, 78 Cannon Street, London EC4N 6HL. Telephone: , ftisalessupport@franklintempleton.co.uk. References to indices are made for comparative purposes only and are provided to represent the investment environment existing during the time periods shown. An index is unmanaged and one cannot invest directly in an index. The performance of the index does not include the deduction of expenses and does not represent the performance of any Franklin Templeton fund 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. The fund charges all or part of its management fees to Capital. This could lead to a higher level of income but may constrain capital growth. 20