30.11.2018 * () 103 16.06.2008 50 * ( 30%) * Stephen Dover, CFA: Bassel Khatoun: Purav Jhaveri, CFA: Salah Shamma: - A Morningstar*: * % 99.13 0.87 100% ( ) * 5 () (%) A 140 120 100 80 11/13 05/14 11/14 05/15 11/15 05/16 11/16 05/17 11/17 05/18 11/18 () (%) 3 1 3 5 10 A -5.93 1.11 2.92 11.01 9.48 52.27-36.50-1.43 11.18 14.41 25.68 18.11 72.01-14.46 () (%) 2017 2016 2015 2014 2013 A 12.75-5.43-11.03 9.06 34.00 3.93 9.08-14.19 5.58 24.87 * ( %) Al Rajhi Bank 6.62 National Bank of Kuwait K.S.C. 5.50 Human Soft Holding Co. KSCC 3.86 Samba Financial Group 3.47 Emirates NBD Bank (P.J.S.C) 3.47 National Commercial Bank CJSC 3.45 Abu Dhabi Commercial Bank 3.36 Malath Cooperative Insurance Co. 2.88 DP World 2.71 Agility Public Warehousing Co. K.S.C. 2.43 12 10.04x 1.57x 7.74x 3 13.52% 3 5 13.33% 12 11.12x (5 ) 14.45% (%) (%) (%) (%) (%) ISIN A 16.06.2008 6.35 2.57 5.00 1.50 0.50 LU0352132103 A 16.06.2008 5.57 2.55 5.00 1.50 0.50 LU0352132285 B 16.06.2008 5.53 3.86 1.50 0.75 1.06 LU0352132525 fti-hk@franklintempleton.com www.franklintempleton.com.hk
30.11.2018 * * (30%) % 32.53 / 30.29 25.13 / 15.40 21.19 / 4.34 15.97 / 12.92 4.32 / 22.75 0.00 / 4.88 0.00 / 2.68 0.00 / 2.21 0.00 / 2.19 0.00 / 2.35 0.87 / 0.00 () % <2.0 41.08 2.0-5.0 9.13 5.0-10.0 7.33 10.0-25.0 17.54 25.0-50.0 6.15 >50.0 0.12 18.65 % 38.99 / 60.03 15.81 / 6.31 10.71 / 1.07 9.65 / 1.84 7.25 / 6.30 5.05 / 0.38 4.88 / 0.84 2.60 / 11.67 2.21 / 0.00 1.98 / 11.57 0.87 / 0.00 () * : 500Standard & Poor's Financial Services LLC 2009 12 3140% 10% 20%10% 20% 2010 9 302010 10 1 30% : Copyright Morningstar, Inc.(1) Morningstar, Inc.(2) (3) CFA Chartered Financial Analyst : Copyright Morningstar, Inc. (1) Morningstar, Inc.(2) (3) : / 100% Copyright 2018 www.franklintempleton.com.hk
2018 04 : Franklin Templeton International Services S.à r.l. : Franklin Advisers, Inc., : J.P. Morgan Bank Luxembourg S.A. : : 6 30 : : 1,000 [] 500 [] # : A () : 2.56% A () : 2.56% B () : 3.86% N () : 3.06% # 2017 12 31 : () Commission de Surveillance du Secteur Financier ( CSSF ) 100% () - 1
UCITS UCIs 10% : : : : : : - 2
: : 40.0% 34.0% 20.0% 18.1% 8.1% 9.1% 12.7% 0.0% 2.2% -5.4% -20.0% -15.4% -11.0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2014 A () A () : 2008 6 16 A () : 2008 6 16-3
A B N ( ) 5.00% 3.00% ( ) * 1.00% ( ) 4.00% ( ) A ** B *** N ** ()* 1.50% 1.50% 1.50% 0.140% 0.140% 0.140% * 0.50% 0.75% 1.00% 1.06% + 0.2175% 0.2175% 0.2175% 30 30 30 * ** *** (()) www.franklintempleton.com.hk i ii www.franklintempleton.com.hk www.franklintempleton.com.hk - 4
(852) 2877 7733 www.franklintempleton.com.hk - 5
Franklin Templeton Investment Funds Franklin MENA Fund Middle East and North Africa Equity 30.11.2018 Fund Fact Sheet For the source and calculation basis of Fund information, please refer to the *Explanatory Notes section. Fund Overview Base Currency for Fund Total Net Assets (USD) USD 103 Millions Fund Inception Date 16.06.2008 Number of Issuers 50 Benchmark Morningstar Category * Summary of Investment Objective S&P Pan Arab Composite Large Mid Cap KSA Capped at 30% Index Africa & Middle East Equity The Fund aims to achieve long-term capital appreciation by investing primarily in equity securities of companies across the entire market capitalisation spectrum in the Middle East and North Africa (MENA) region, including, but not limited to Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Qatar, Saudi Arabia, Tunisia and the United Arab Emirates. Fund Management* Stephen Dover, CFA: United States Bassel Khatoun: U. Arab Emir. Purav Jhaveri, CFA: United States Salah Shamma: U. Arab Emir. Ratings - A (acc) USD Overall Morningstar Rating *: Asset Allocation* % Equity 99.13 Cash & Cash Equivalents 0.87 Offering Documents Risk Considerations The Fund invests in emerging market securities which are exposed to higher risk of economic, political and regulatory changes that may pose additional risk to the Fund. The Fund may invest up to 100% of their total net assets in structured products, mortgage- and asset-backed securities and derivatives (such as credit default swaps, forwards and options), and is subject to significant liquidity and counterparty default risks. The Fund's value may be affected by exchange control regulations and changes in exchange rates. This investment involves risks which may result in loss of part or entire amount of your investment. Before you decide to invest, you should make sure the intermediary has explained to you that the Fund is suitable to you. Investors should not only base on this marketing material alone to make investment decisions. Performance* Performance over 5 Years in Share Class Currency (%) Franklin MENA Fund A (acc) USD 140 120 100 80 11/13 05/14 11/14 05/15 11/15 05/16 11/16 05/17 11/17 05/18 11/18 Performance in Share Class Currency (%) Cumulative 3 Mths YTD 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Incept A (acc) USD -5.93 1.11 2.92 11.01 9.48 52.27-36.50 Benchmark in USD -1.43 11.18 14.41 25.68 18.11 72.01-14.46 Calendar Year Performance in Share Class Currency (%) 2017 2016 2015 2014 2013 A (acc) USD 12.75-5.43-11.03 9.06 34.00 Benchmark in USD 3.93 9.08-14.19 5.58 24.87 Top Ten Holdings (% of Total) Issuer Name Al Rajhi Bank 6.62 National Bank of Kuwait K.S.C. 5.50 Human Soft Holding Co. KSCC 3.86 Samba Financial Group 3.47 Emirates NBD Bank (P.J.S.C) 3.47 National Commercial Bank CJSC 3.45 Abu Dhabi Commercial Bank 3.36 Malath Cooperative Insurance Co. 2.88 DP World 2.71 Agility Public Warehousing Co. K.S.C. 2.43 Fund Measures Price to Earnings (12-mo 10.04x Trailing) Price to Book 1.57x Price to Cash Flow 7.74x Historical 3 Yr Sales Growth 13.52% Estimated 3-5 Yr EPS Growth 13.33% Price to Earnings (12-mo 11.12x Forward) Standard Deviation (5 Yrs) 14.45% Share Class Information Fees Dividends Fund Identifiers Share Class Incept Date NAV TER (%) Max. Sales Charge (%) Mgmt. Fee (%) Max. Maint. Charge (%) Max. Serv. Charge (%) Last Paid Date Last Paid Amount ISIN A (acc) USD 16.06.2008 USD 6.35 2.57 5.00 1.50 0.50 N/A N/A N/A LU0352132103 A (acc) EUR 16.06.2008 EUR 5.57 2.55 5.00 1.50 0.50 N/A N/A N/A LU0352132285 B (acc) USD 16.06.2008 USD 5.53 3.86 N/A 1.50 0.75 1.06 N/A N/A LU0352132525 E-Mail fti-hk@franklintempleton.com Web www.franklintempleton.com.hk
Franklin MENA Fund 30.11.2018 For the source and calculation basis of Fund information, please refer to the *Explanatory Notes section. Composition of Fund* Franklin MENA Fund S&P Pan Arab Composite Large Mid Cap KSA Capped at 30% Index Geographic % of Total Saudi Arabia 32.53 / 30.29 U. Arab Emir. 25.13 / 15.40 Egypt 21.19 / 4.34 Kuwait 15.97 / 12.92 Qatar 4.32 / 22.75 Morocco 0.00 / 4.88 Bahrain 0.00 / 2.68 Jordan 0.00 / 2.21 Oman 0.00 / 2.19 Others 0.00 / 2.35 Cash & Cash Equivalents 0.87 / 0.00 Market Capitalisation Breakdown in USD % of Equity <2.0 Billion 41.08 2.0-5.0 Billion 9.13 5.0-10.0 Billion 7.33 10.0-25.0 Billion 17.54 25.0-50.0 Billion 6.15 >50.0 Billion 0.12 N/A 18.65 Sector % of Total Financials 38.99 / 60.03 Industrials 15.81 / 6.31 Consumer Discretionary 10.71 / 1.07 Consumer Staples 9.65 / 1.84 Real Estate 7.25 / 6.30 Health Care 5.05 / 0.38 Energy 4.88 / 0.84 Materials 2.60 / 11.67 Information Technology 2.21 / 0.00 Others 1.98 / 11.57 Cash & Cash Equivalents 0.87 / 0.00 Important Information Unless stated otherwise, all information is as of the publishing date of this document. Source: Franklin Templeton Investments. Franklin Templeton Investments (Asia) Limited is the issuer of this document. This document is neither an offer nor solicitation to purchase shares of the fund; applications for shares may only be made on forms of application available with the Offering Documents. Investments are subject to investment risks, fund value may go up as well as down and past performance is not an indicator or a guarantee of future performance. The investment returns are denominated in fund currency. Investors investing in funds denominated in non-local currency should be aware of the risk of exchange rate fluctuations that may cause a loss of principal. Investors should read carefully the Offering Documents (including the section 'Risk Considerations') for the relevant risks associated with the investment in the fund before investing. Distribution of this document may be restricted in certain jurisdictions. This document does not constitute the distribution of any information or the making of any offer or solicitation by anyone in any jurisdiction in which such distribution or offer is not authorized or to any person to whom it is unlawful to distribute such a report or make such an offer or solicitation. This document has not been reviewed by the Securities and Futures Commission of Hong Kong. *Explanatory Notes Performance: Performance information is based on the stated share class only, in Fund Currency, NAV to NAV, taking into account of dividend reinvestments and capital gain or loss. 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. STANDARD & POOR S, S&P and S&P 500 are registered trademarks of Standard & Poor s Financial Services LLC. Standard & Poor s does not sponsor, endorse, sell or promote any S&P index-based product. The Fund's benchmark was changed from MSCI Arabian Markets Index (single country constituents capped at 40%, Saudi Arabia 10% cap) to MSCI Arabian Markets (with Saudi Arabia 20% Capped) on 31 December 2009 to allow for Fund to increase exposure to Saudi Arabia from 10% to 20%. It was subsequently changed to S&P Pan Arab Composite Large Mid Cap (KSA Capped at 30%) on 1 October 2010 since MSCI has discontinued calculating indices that include Saudi Arabia as of 30 September 2010. Morningstar Category : Copyright 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 provided for reference purposes only. Past performance is not an indicator or a guarantee of future performance. Fund Management: In the case of portfolio managers who are CFA Charterholders, CFA and Chartered Financial Analyst are trademarks owned by CFA Institute. Ratings: Copyright 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 provided for reference purposes only. Past performance is not an indicator or a guarantee of future performance. Top 10 Holdings: These securities do not represent all of the securities purchased, sold or recommended for clients, and the reader should not assume that investment in the securities listed was or will be profitable. 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 holdings list. Asset Allocation/Composition of Fund: Due to rounding, the sum of portfolio may not equal 100%. 2018. Franklin Templeton Investments. All rights reserved. www.franklintempleton.com.hk
Product Key Facts Franklin Templeton Investment Funds Franklin MENA Fund Last updated: April 2018 This statement provides you with key information about this product. This statement is a part of the offering document. You should not invest in this product based on this statement alone. Quick facts Management company: Franklin Templeton International Services S.à r.l. Investment manager: Franklin Advisers, Inc., United States of America (internal delegation) Depositary: J.P. Morgan Bank Luxembourg S.A. Base currency: USD Financial year end of this Fund: 30 June Dealing frequency: Every Hong Kong Business Day Minimum Investment: USD 1,000 [initial] and USD 500 [subsequent purchases] or equivalent Ongoing charges over a year # : Class A (acc) EUR: 2.56% Class A (acc) USD: 2.56% Class B (acc) USD: 3.86% Class N (acc) USD: 3.06% # The ongoing charges figures are based on the semi-annual financial statements for the period ended 31 December 2017. These figures may vary from year to year. Dividend policy: Dividends, if declared, will be reinvested unless indicated by you in the application form to be paid out. Subject to any legal and regulatory requirements, the Fund may at its discretion pay dividends out of the capital or out of gross income of the Fund while paying all or part of the Fund s fees and expenses out of the capital of the Fund, which results in effectively paying dividends out of capital. The Fund may amend such distribution policy subject to the SFC s prior approval and by giving not less than one month s prior notice to investors. Any distributions involving payment of dividends out of the Fund s capital or payment of dividends effectively out of the Fund s capital (as the case may be) may result in an immediate reduction of the net asset value per share. What is this product? This is a fund constituted in the form of a mutual fund. It is domiciled in Luxembourg and its home regulator is Commission de Surveillance du Secteur Financier ( CSSF ). Investment Objective and Policy Franklin MENA Fund (the Fund ) aims to increase the value of its investments over the medium to long term. The Fund invests primarily (that is, at least two-thirds of the Fund s net assets) shall be invested into the relevant securities. In exceptional market circumstances (such as extreme volatility) and on a temporary basis only, 100% of the Fund s net assets may be invested in liquid assets, with due regard to the principle of risk spreading) in: transferable securities such as equity securities issued by companies of any size incorporated in, or which have their principal business activities in, the Middle East and North Africa (MENA) region, including but not limited to the Kingdom of Saudi Arabia, United Arab Emirates, Kuwait, Qatar, Bahrain, Oman, Egypt, Jordan and Morocco The Fund can invest on an ancillary basis in: participatory notes Franklin Templeton Investment Funds - Franklin MENA Fund 1
transferable securities such as equity, equity-related and fixed income securities issued by governments and corporations of any size located in any country units of Undertakings for Collective Investment in Transferable Securities ( UCITS ) and other Undertakings for Collective Investment ( UCIs ) (limited to 10% of the Fund s net assets) derivatives for hedging, efficient portfolio management and/or investment purposes The Fund does not intend to invest extensively or primarily in financial derivative instruments for investment purposes. What are the key risks? Investment involves risks. Please refer to the offering document for details including the risk factors. Market risk: The market values of securities owned by the Fund will tend to go up or down, sometimes rapidly or unpredictably, due to factors affecting individual issuers, particular industries or sectors within securities markets, or because of general market conditions. During a general downturn in the securities markets, multiple asset classes (including different sectors of the same asset class) may decline in value at the same time. Similarly, when markets perform well, there can be no assurance that securities held by the Fund will participate in the advance. Because the securities the Fund holds fluctuate in price in this manner, the Fund s value may go down as well as up and investors may be adversely affected. Equity risk: Equity and equity-linked securities are subject to significant price movements due to various economic, political, market and issuer-specific factors. Such changes may adversely affect the value of equities regardless of issuer-specific performance. Additionally, different industries, financial markets and securities can react differently to these changes. Such fluctuations of the Fund s value are often exacerbated in the short-term. Financial markets trends (including feared or actual failures in the banking system) may also cause large fluctuations in the prices of such securities. As a result, the Fund may be adversely affected. Emerging markets risk: The Fund may invest in, or be exposed to, emerging markets, which may involve increased risks and special considerations not typically associated with investment in more developed markets. The risks of investing in emerging markets, which can adversely affect and/or result in a substantial loss to the Fund, may include: liquidity risks, currency risks/control, political and economic uncertainties, legal and taxation risks, settlement risks, custody risk and the likelihood of a high degree of volatility. Frontier markets risk: Investments in frontier markets involve risks similar to investments in emerging markets but to a greater extent since frontier markets are even smaller, less developed, and less accessible than other emerging markets. Frontier markets may also experience greater political and economic instability and may have less transparency, less ethical practices, and weaker corporate governance compared to other emerging markets. Such markets are also more likely to have investment and repatriation restrictions, exchange controls and less developed custodial and settlement systems than other emerging markets. As a result, the Fund/investors may be adversely impacted. Foreign currency risk: The Fund will typically invest to a significant degree in securities that are denominated in currencies other than the base currency of the Fund, exposing its investments to changes in foreign exchange rates and the possibility of exchange control regulations. Changes in currency exchange rates may adversely affect the value of the Fund, and also may affect the income earned by the Fund and gains and losses realized by the Fund. The Fund may seek to hedge currency exposure, which can limit the potential for currency gains. To the extent that the Fund seeks to hedge or protect against currency exchange risk, there is no guarantee that hedging or protection will be achieved, and the value of the Fund may be adversely affected.furthermore, the total return for a share class that is denominated in a different currency (the alternative currency ) from the base currency of the Fund may be affected, either positively or negatively, by changes in the exchange rate between the Fund s base currency and the alternative currency. Franklin Templeton Investment Funds - Franklin MENA Fund 2
Liquidity risk: The Fund may not be able to easily sell securities due to adverse market conditions or reduced value or creditworthiness of issuers in which it invests. The inability of the Fund to sell securities or positions may also impede the ability of the Fund to meet redemption requests in a timely manner. Certain securities may also be illiquid due to limited trading markets or contractual restrictions on their resale. Reduced liquidity due to these factors may have an adverse impact on the net asset value of the Fund. Regional market risk: By being concentrated in one region (i.e., MENA), the Fund could suffer greater volatility compared to funds that follow a more diversified policy. The value of the Fund may be more susceptible to adverse economic, political, policy, foreign exchange, liquidity, tax, legal or regulatory events affecting the MENA region and the Fund/investors may be adversely impacted. Non-regulated markets risk: Some markets that the Fund invests in do not qualify as regulated due to their economic, legal, or regulatory structure, exposing the Fund to greater regulatory risk compared to funds that invest only in regulated market(s). The Fund may be adversely affected as a result. Smaller- and mid-sized companies risk: Stocks of smaller- and mid-sized companies tend to be less liquid and more volatile to adverse economic developments than larger, more recognized companies, particularly if such companies are in emerging markets, which results in higher risk for the Fund. The value and performance of the Fund may be adversely affected as a result. Growth stocks risk: Growth stocks can be more volatile and may be more expensive, relative to earnings, than the market in general. The Fund may be adversely affected by the greater volatility of investments in such stocks. Derivative instruments risk: Derivative instruments involve cost, may be volatile, and may involve a leverage effect. A small market movement may give rise to a proportionately larger impact, which may cause substantial loss to the Fund. Other risks include counterparty/credit risk, liquidity risk, valuation risk, volatility risk and over-the-counter transaction risk. In adverse situations, the Fund s use of derivative instruments may become ineffective and the Fund may suffer significant losses. Counterparty risk: The Fund may be exposed to the credit/default risks of its counterparties and the Fund/investors may be adversely impacted. Dividend policy risk: The Fund s dividend policy allows for payment of dividends out of capital or effectively out of capital. Where this is done, it amounts to a return or withdrawal of part of an investor s original investment or from any capital gains attributable to that original investment. Any distributions involving payment of dividends out of the Fund s capital or payment of dividends effectively out of the Fund s capital (as the case may be) may result in an immediate reduction of the net asset value per share. Franklin Templeton Investment Funds - Franklin MENA Fund 3
How has the Fund performed? 40.0% 34.0% 20.0% 18.1% 8.1% 9.1% 12.7% 0.0% 2.2% -5.4% -20.0% -15.4% -11.0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 The performance of the Fund in these years was achieved under circumstances that no longer apply. The investment policy was changed in 2014. Past performance information is not indicative of future performance. Investors may not get back the full amount invested. The computation basis of the performance is based on the calendar year end, NAV-to-NAV, with dividends reinvested. These figures show by how much class A (acc) USD increased or decreased in value during the calendar year being shown. Class A (acc) USD is the share class available in Hong Kong with the longest history in the Fund. Performance data has been calculated in USD, including ongoing charges and excluding subscription fee and redemption fee you might have to pay. Where no past performance is shown, there was insufficient data available in that year to provide performance. Fund launch date: 16 June 2008 Class A (acc) USD launch date: 16 June 2008 Is there any guarantee? This Fund does not have any guarantees. You may not get back the full amount of money you invest. Franklin Templeton Investment Funds - Franklin MENA Fund 4
What are the fees and charges? Charges which may be payable by you You may have to pay the following fees when dealing in the shares of the Fund. Class A Class B Class N Subscription fee (Initial sales charge) Up to 5.00% of the N/A Up to 3.00% of the subscription subscription amount amount Switching fee (Switching charge)* 1.00% of the N/A N/A value of the shares being switched Redemption fee (Redemption charge) N/A Up to 4.00% N/A Ongoing fees payable by the Fund The following expenses will be paid out of the Fund. They affect you because they reduce the return you get on your investments. Annual rate (as a % of the Fund s net asset value) Class A** Class B*** Class N** Management fee (Investment management fee)* 1.50% 1.50% 1.50% Depositary fee Up to 0.140% Up to 0.140% Up to 0.140% Performance fee N/A N/A N/A Administration fee N/A N/A N/A Maintenance charge* 0.50% 0.75% 1.00% Servicing charge N/A 1.06% N/A Registrar and Transfer, Corporate, Domiciliary and Up to 0.2175% Up to 0.2175% Up to 0.2175% Administrative Agent fee + Additional fixed amount per Shareholder account at each Class Up to USD 30 per Up to USD 30 per Up to USD 30 per level annum annum annum *The current fee level may be increased up to the maximum level permitted by the constitutive document of the Fund by giving one month s prior notice to the shareholders. ** The Annual Management Fees as defined in the Explanatory Memorandum comprise of the Management Fee (Investment Management Fee) and the Maintenance Charge. *** The Annual Management Fees as defined in the Explanatory Memorandum comprise of the Management Fee (Investment Management Fee), the Maintenance Charge and the Servicing Charge. Other fees You may have to pay other fees and charges when dealing in the shares of the Fund. Additional Information You generally buy and redeem shares at the Fund s next determined net asset value (NAV) after the Hong Kong Representative, Franklin Templeton Investments (Asia) Limited, receives your request in good order on or before 4:00 p.m. (Hong Kong time) being the dealing cut-off time. Certain intermediaries may impose an earlier dealing cut-off time. Franklin Templeton Investment Funds - Franklin MENA Fund 5
The net asset value of this Fund is calculated and the price of shares is published on each business day. Information about prices is available online at www.franklintempleton.com.hk. The compositions of the dividends (i.e. the relative amounts paid out of (i) net distributable income and (ii) capital) for the last 12 months are made available by the Hong Kong Representative on request and are also available online at www.franklintempleton.com.hk. Investors may obtain the past performance information of other share classes offered to Hong Kong investors from the Hong Kong Representative's website at www.franklintempleton.com.hk. Investors may obtain information on the intermediaries by calling the Hong Kong Representative at (852)2877-7733 or visiting the Hong Kong Representative's website at www.franklintempleton.com.hk. The website mentioned above has not been reviewed by the Securities and Futures Commission ( SFC ). Important If you are in doubt, you should seek professional advice. The SFC takes no responsibility for the contents of this statement and makes no representation as to its accuracy or completeness. Franklin Templeton Investment Funds - Franklin MENA Fund 6