FLBR Profile
The Franklin FTSE Brazil ETF is designed to offer investors targeted exposure to the Brazilian equity market by focusing on large- and mid-capitalization stocks. Under typical market conditions, the fund allocates at least 80% of its assets to securities that are constituents of the FTSE Brazil Capped Index, as well as depositary receipts linked to these securities. This strategic focus allows the fund to closely mirror the performance of the index and provides investors with concentrated exposure to Brazil's key economic sectors.
The FTSE Brazil Capped Index, which underpins the fund's investment approach, is derived from the broader FTSE Brazil Index. It is specifically engineered to capture the performance of major Brazilian companies listed on the São Paulo Stock Exchange (B3). The index utilizes a capping methodology to limit the influence of any single stock, ensuring that no single company disproportionately affects the index's overall performance. This approach aims to enhance diversification and provide a balanced representation of Brazil's large- and mid-cap stock market.
The ETF’s holdings span a range of industries that are critical to Brazil’s economy, including financials, materials, energy, and consumer staples. By investing across these sectors, the fund provides a broad view of Brazil’s economic landscape and potential growth areas. The non-diversified nature of the fund means that it may concentrate its investments in fewer stocks compared to more broadly diversified funds, which could lead to higher volatility but also the potential for significant returns based on the performance of selected companies.
Investors in the Franklin FTSE Brazil ETF gain targeted exposure to Brazil’s leading companies, which can be advantageous for those seeking to capitalize on the country's economic growth and sectoral dynamics. However, the concentrated investment approach and exposure to the Brazilian market’s fluctuations entail risks that investors should consider. The fund is well-suited for those looking to diversify their portfolios with specific exposure to Brazil's large- and mid-cap equity sectors while aiming to benefit from the country's economic trends.
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