Franklin Templeton Investments (India), one of the largest fund houses in the country, is launching a new open end fund of fund called FT India Feeder – Franklin US Opportunities Fund (FTIF -FUSOF). The fund will invest into the Luxembourg-domiciled Franklin US Opportunities Fund (master fund), which invests in US based companies across sectors and market capitalization range. Launched in 2000, the master fund invests principally in US companies that demonstrate accelerating growth, increasing profitability, or above-average growth or growth potential relative to the overall economy. The New Fund Offer will be open from January 17, 2012 to January 31, 2012 during which units will be available at Rs.10 per unit.
Commenting on the rationale for launching the new fund, Harshendu Bindal, President, Franklin Templeton India said, "International diversification is a key ingredient for long-term success of an investment portfolio, but Indian investors traditionally have had a low exposure to international funds due to the relatively better performance of Indian markets. The increased market volatility since 2008 has increased the acceptance of diversification as a key investment tool.
The new fund helps investors achieve diversification through exposure to high quality US companies that are currently trading at attractive valuations. Adding such an international fund to the portfolio can help investors reduce the potential portfolio over the medium to long term. The US continues to be the largest economy in the world with one of the highest per capita income levels and many of US companies are global leaders in their industries with a large percentage of their revenues coming from non-US operations."
Speaking about the underlying master fund's strategy Grant Bowers, Portfolio Manager and Vice President of Franklin Equity Group, commented "The global economy is going through an uncertain phase, but recent data is pointing towards an improving economy in the United States. US companies emerged from the 2008 crisis with stronger balance sheets, leaner operations all of which make them very competitive in the global marketplace. The fund invests in US based companies that are clear leaders in their industries and are uniquely positioned to benefit from the expected demand in US as well as strong demand globally for their products and services.
We manage a diversified portfolio of the leading companies in the US market. These companies typically demonstrate strong growth potential and have sustainable competitive advantages in their businesses. We aim to research the best individual risk-return opportunities available anywhere in the entire U.S., with broad-based exposure to a wide range of industries."