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Templeton Global Allocation Fund Filed with SEC !

Global - The New Core

Franklin Templeton has confirmed that they hope to launch their Global Allocation Fund by year-end.

Here's the SEC filing:

"Under normal market conditions, the Fund seeks to achieve its investment goal by (1) investing in a diversified core portfolio of equity and fixed income investments, and (2) tactically adjusting the Fund's exposure to certain asset classes, regions, currencies and sectors independent of the investment processes of the investment strategies that comprise the core portfolio.

Under normal market conditions, the Fund’s baseline allocation between broad asset classes is:

50% Global Equity (U.S. / International / Emerging)
35% Global Fixed Income (U.S. /International / Emerging)
5% Commodity-linked Instruments
10% Cash and Derivative Instruments

The Fund is structured as a multi-manager fund, with the investment manager responsible for monitoring the Fund's overall investment performance, managing portions of the Fund's core portfolio, managing the Fund's tactical asset allocation, and re-balancing the Fund’s portfolio to maintain the baseline allocation to various asset classes and investment strategies. The baseline allocation also may change from time to time, at the discretion of the investment manager."


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  • I'd rather just own Templeton Global Bond and get the stock exposure elsewhere (but that's just me.)
  • Another note --- the Templeton Emerging Markets Balanced Fund is slated to debut around October 1st.

  • That's more interesting, although the Mobius (or, as I like to call him, BRICFinger, 'cause he looks like an old-school bond villain) funds are not for the timid.
  • Sounds to me like this could look something like INOYX Ivy Asset Strategy New Opportunities Fund, which started last May. At present, it has less than 60% in emerging markets, according to the most recent M* data. Depending on how Templeton structures the fund, it has promise. If it is a fund of funds, that has very little appeal. But if it is more like Ivy's INOYX, the multi-manager process could be very good.

    Responding to Maurice's comments on the Templeton C shares expenses, I agree. YIKES! But then, almost all fund companies' C shares are outrageously expensive. The way share classes have evolved - as a way to market to a specific business model of salespeople - is very disappointing. Some companies have done away with class B shares (which are expensive, but at least converted to class A shares after a few years). But they have maintained class C shares, which are usually even more expensive and NEVER convert to class A. Unfortunately they are often marketed as "no-load" or non-commission funds, which is simply a lie. So-called advisors may tell clients (and themselves) that they receive no commissions on class C shares, only "fees" from the fund company. While it is true that there are no up-front commissions, the 12b-1 "fees" are in fact trail commissions that go on forever and ever. The salesperson's broker-dealer receives the 12b-1 fees from the fund, then pays the agreed-upon percentage to the salesperson. Both parties benefit from this, at the expense of the consumer. I don't see an end to 12b-1 fees (the SEC essentially caved to FINRA on this), but I would urge investors to avoid funds where these fees are more than 0.25%. Ideally, there would be no 12b-1 fees.
  • Reply to @scott: Scott, like you I'm a fan of Templeton Global Bond (wife and I both own it). Since you seem to have been a fan of that fund for a while, let me ask you -- does it ever concern you that the fund is generally 99% sovereigns?

    Occasionally I've come across the argument that if one's bond sleeve is used to dampen volatility and "store cash" to be reallocated during market dips, the bond sleeve should be largely sovereigns (rather than HY or corporates).

    So, I'd be interested to hear your (and others') thoughts.
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