Franklin Pelagos Commodities Strategy Fund

This fund or share class has been liquidated or reorganized.

This fund or share class has been liquidated or reorganized.

INVESTMENT PHILOSOPHY, STRATEGY AND APPROACH

Investment Philosophy

The managers believe:

  • Market inefficiencies and price volatility create opportunities for active commodities investors.
  • Both top-down macroeconomic research and bottom-up fundamental analysis add value.
  • Sector and commodity-specific allocation decisions will ultimately have the greatest impact on commodity fund returns.
  • Long-term total return and collateral maintenance can be achieved on parallel tracks.

Investment Process

The team implements an active, flexible, and research-driven process. Top-down analysis seeks to identify drivers of global growth, capital markets and sector trends. Bottom-up analysis explores supply, demand, price, momentum, seasonal and fundamental corporate data trends. Portfolio construction decisions seeks to identify the best near-term sources of alpha, implementing ideas via a broad range of commodity-linked derivative instruments. The fund will also invest in low duration U.S. government / agency securities and other fixed income securities to help manage volatility and satisfy asset coverage requirements.