Award-winning Franklin Global Growth Fund upgraded by Lonsec amid strong performance through the pandemic
Franklin Templeton Australia’s flagship Franklin Global Growth Fund has been upgraded to ‘Recommended’ status by ratings agency Lonsec.
The Fund is an actively managed, long only international equities product that invests in a concentrated portfolio of approximately 35-40 stocks and aims to outperform the MSCI World ex-Australia Index (the ‘Benchmark’, after fees) over the medium to longer term.*
In its rating report, Lonsec highlighted among the Fund’s strengths its portfolio management team and the flexibility to invest down the market cap spectrum.
“Lonsec has strong regard for the Manager’s growth investment philosophy and intensive research process,” the report stated.
The report also recognised the “experienced portfolio management team with long co-tenure” who operate with a “differentiated growth equity investment style that has been consistently applied through time.”
Deep research and flexible approach
The Franklin Global Growth team was also named a finalist for Morningstar Australia’s 2021 fund manager of the year in global equities, off the back of a 2020 win in the same category. Finalists for the 2021 award were all recognised for their oversight of funds which delivered outstanding outcomes to investors through the pandemic.
Sydney-based Portfolio Manager Francyne Mu said the team’s bottom-up stock analysis aims to identify quality, sustainable growth companies with robust balance sheets and healthy free cash flows that can remain resilient in challenging economic circumstances.
“The Franklin Global Growth Fund has allowed Australian investors to achieve strong risk-adjusted returns along with diversification and access to innovation,” Ms. Mu said.
“The Fund’s emphasis on in-depth research and its flexibility to move down the market cap spectrum allows the Fund to identify opportunities that may be under researched and overlooked by the market.”
Ms. Mu said this approach enables diversification and access to companies that may be earlier in their growth cycle.
“Our differentiated, research-intensive approach has seen the Fund significantly outperform over the last year without holding any of the well-known FAANG (Facebook, Apple, Amazon, Netflix and Google’s Alphabet) growth stocks.”
Beating the benchmark
The Franklin Global Growth Fund has outperformed the Benchmark over the last several years on a foundation of strong research and investment insights.
Over five years to February 2021, the Fund delivered a return of 18.9% p.a. (after fees), outperforming the Benchmark by 6.6% p.a. The Fund returned 30.6% in the 2020 calendar year, outperforming the Benchmark by 24.8%.
Information technology, industrials and consumer discretionary were the biggest contributors to the outperformance in 2020. While its growth style provided tailwinds over the period, stock selection provided the bulk of the positive contribution, reflecting the depth of research and differentiated investment approach.
Matthew Harrison, Managing Director of Franklin Templeton Australia and New Zealand, said the Fund’s recent recognitions are a testament to the caliber of the investment management team.
“The Franklin Global Growth Fund has an exceptional team with Don Huber and John Remmert in the United States and Francyne Mu on the ground here in Australia. They continue to demonstrate their ability to identify international stocks with compelling long-term growth prospects and deliver strong risk-adjusted returns for our investors,” Mr. Harrison said.
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