Franklin Catholic Principles Emerging Markets Sovereign Debt UCITS ETF USD

Issuer: Franklin Templeton

Asset Class: Fixed Income

TER: 35bps

Trading Currency: USD

Pays Income: False

Listing Date: 01 Jul 2022

Ticker: EMCV

ISIN: IE000YZIVX22

This actively managed fund seeks to deliver attractive total returns through a combination of income and capital growth by investing in undervalued sovereign debt from emerging market countries. The investment strategy is rooted in a fundamental, value-oriented approach, which differentiates it from traditional market-cap-weighted index funds. The portfolio managers employ a proprietary, multi-factor model to screen the emerging market debt universe, identifying securities that appear mispriced relative to their intrinsic value. This model assesses factors such as a country's long-term economic prospects, fiscal health, political stability, and market sentiment to uncover potential investment opportunities that may be overlooked by the broader market.

By focusing on undervalued securities, the fund aims to generate alpha and potentially offer a degree of downside protection compared to passive strategies, especially during periods of market stress. The portfolio is constructed with a long-term perspective, emphasizing countries with sound fundamentals and a high probability of credit rating upgrades or spread compression. This approach may appeal to investors looking for actively managed exposure to the higher-yield potential of emerging market sovereign debt, but with a disciplined, value-driven framework designed to manage risk and identify compelling long-term investment opportunities across a diverse range of developing economies.