Franklin Templeton launches government bond fund
Franklin Templeton Investments has announced the launch of Franklin Global Government Bond Fund, providing access to global bond markets with a focus on investment-grade issues.
Luxembourg investors can access this new fund beginning 9 September, 2013.
Fund managers will take a bottom-up research approach and screen for securities “with the best prospects for income, capital appreciation and price stability,” Franklin Templeton Investments said.
By concentrating on highly-rated government securities, the fund has been designed to offer investors a source of portfolio stabilisation and diversification.
The fund also seeks to maximise total investment return consisting of a combination of interest income and capital appreciation.
Franklin Global Government Bond Fund aims to achieve its investment objective by investing in fixed or floating-rate debt securities and obligations issued by government and government-related entities located throughout the world and take opportunistic exposure to corporate and mortgage-backed securities.
It may also make limited purchases of below investment-grade securities and obligations issued by emerging market governments.
“At the moment, some bond markets across the globe are offering investors appealing risk-adjusted returns,” said John W. Beck, the fund’s co-lead portfolio manager and co-director of Franklin Templeton Fixed Income Group’s global fixed income department.
He added: “Default rates on investment-grade sovereign debt remain at near zero. Couple this with the positive trend in global gross domestic product (GDP) growth, the nascent recovery in Europe and the continued fiscal strength of many emerging markets, and we believe this may be an encouraging time for prudent investment in the asset class.”
“We allocate investments across the fixed income universe to help reduce risk and maintain flexibility,” said David Zahn, CFA , FRM, the fund’s co-lead portfolio manager, and senior vice president and head of European Fixed Income for the Franklin Templeton Fixed Income Group.