Franklin Templeton has unveiled a suite of core equity funds targeting Canadian, U.S., and international markets, extending internally proven strategies to retail and institutional investors in Canada. Developed 5 - 6 years ago to stabilize multi-asset portfolios, these systematic funds replace volatile blends of passive and high-active-share vehicles with controlled tracking error, balancing alpha potential against benchmark risk.

At their core, the funds harvest five factors: familiar quality, sentiment, and value, approached uniquely for outperformance; an alternative factor capturing misfits like low short-interest stocks that historically outperform heavily shorted names; and a proprietary conviction factor distilling stock-picking alpha from Franklin Templeton's manager network via quantitative isolation of preferred holdings.

Each factor stands tested for long-term value, but their interplay drives the edge, with cyclical rotations smoothing returns and enhancing diversification. A robust team, assembled since the 1980s through acquisitions and talent builds, oversees evolution against alpha decay, ensuring adaptability.

Advisors face mounting fee pressures and time constraints, making these low-cost vehicles ideal for efficient core-satellite builds. They deliver "value for fee," predictability, and bandwidth for satellite bets in alternatives, while comprehensive risk management tempers volatility. As Greenberg notes, they foster "sleep-at-night" exposures, freeing focus for high-conviction overlays.

With proven internal success, the launch aligns with demands for consistent outcomes in fee-sensitive environments, positioning systematic factors as a cornerstone for resilient equity allocation.

Author: Asset TV
Source: Video - Smarter core, better outcomes with Franklin Templeton’s Michael Greenberg