Franklin Templeton FRAR ETF (ASX:FRAR)

Franklin Australian Absolute Return Bond Fund (Managed Fund)

Ethical

About the FRAR ETF

The Franklin Templeton FRAR provides investors with exposure to Australian and global, fixed income securities. FRAR is actively managed and aims to deliver returns in excess of the Bloomberg AusBond Bank Bill Index, after fees and expenses (but before taxes), over the short to medium term. FRAR seeks to deliver defensive, stable Australian dollar hedged returns.

FRAR ETF Performance Review

4.66

0.44

1.59

2.31

5.01

Data Current To: 17/04/2024

Our review of FRAR ETF

Actively managed absolute return fund

Predominantly a corporate bond portfolio that also has exposure to government bonds

Able to invest in up to 20% of sub investment grade securities with a minimum BB- credit rating at the time of purchase

Able to invest in up to 20% of the Fund’s NAV in securities issued by foreign issuers denominated in currencies other than the Australian Dollar. Able to exceed this limit if the fund managers deem it is the best interests of the unitholders.

The fund may hold derivatives

ESG overlay

What we like about the FRAR ETF

Actively managed

Any foreign currency holdings are hedged to AUD

Monthly income

Inception was December 2014, so the fund has a track record

Shorter dated weighted average maturity of 3.46 years as at 31 March 2024

The fund will not invest in companies directly involved in:
- The production of “Controversial Weapons”
- The manufacture of tobacco products
- Mining or extraction of thermal coal, or extraction of oil from tar sands (subject to a 10% revenue threshold)
- Gambling activities, manufacture of alcohol or producing, directing or publishing adult entertainment materials that fall into certain categories (each subject to a 10% revenue threshold)

Things to be aware of about the FRAR ETF

Relatively low yield to maturity of 5.01% as at 31 March 2024, but commensurate with the shorter dated nature of the fund

Takes some interest rate risk

FRAR ETF Investment Strategy

The investment objective of the Fund is to provide investors with access to an actively managed portfolio of fixed income strategies with an aim to deliver returns in excess of the Bloomberg AusBond Bank Bill Index, after fees and expenses (but before taxes), over the short to medium term.

What does the FRAR ETF Invest In?

FRAR is a Corporate Bond ETF.

The Fund invests in a diversified portfolio of Australian and global fixed income securities.

FRAR ETF Credit Quality

The average credit quality of the FRAR ETF is A.

A detailed breakdown of the credit quality is expressed below.

FRAR Frequently Asked Questions

What index does the FRAR ETF aim to replicate?

The FRAR ETF aims to replicate the Bloomberg AusBond Bank Bill Index.

How often does FRAR ETF pay distributions?

The distribution frequency of FRAR is Monthly.

When did the FRAR ETF start?

The inception date of the FRAR ETF was 22/12/2014.

What are the net assets of the FRAR ETF?

FRAR has net assets of $1160m (AUD) as of 17/04/2024.

What are the number of holdings in the FRAR ETF?

Total number of holdings in FRAR is 237 as of 17/04/2024.

What are the management fees for the FRAR ETF?

The annual management fees for the FRAR ETF are 0.50% p.a. Learn more about ETF fees in this article.

How can I invest in the FRAR ETF?

FRAR is an Exchange Traded Fund, and units may be bought or sold on the ASX like shares. Learn how to buy and sell ETFs in this article.

Does the FRAR ETF have a minimum investment amount?

No, there is no minimum to invest in the Franklin Templeton FRAR ETF. Exchange Traded Funds in general do not have a minimum investment amount required by the issuer. However, if you choose to invest through a broker, they may choose to set their own minimum investment amount.

Are there any performance fees associated with the FRAR ETF?

No, FRAR has no performance fee. This is one of the advantages of Exchange Traded Funds, as they are traded like shares, you’ll generally only pay a commission to buy or sell units and an ongoing management fee.

FRAR ETF News

Franklin Templeton Launches Absolute Return Bond Fund (April 15th, 2024)

About The Issuer Of The FRAR ETF: Franklin Templeton

Franklin Templeton’s mission is to help clients achieve better outcomes through investment management expertise, wealth management and technology solutions. With more than 1,300 investment professionals, and offices in major financial markets around the world, the California-based company has over 75 years of investment experience and over AUD $2.1 trillion in assets under management as of 31 December 2023.