Multi Asset Funds
What Is a Multi-Asset Fund?
As the name suggests, a multi-asset fund combines multiple asset classes in a single portfolio. These funds may invest in a number of traditional equity and fixed income strategies, index-tracking funds, financial derivatives as well as alternative investments, such as real estate investment trusts (REITs) and commodities.
This diversity allows portfolio managers to tactically shift risk exposures on behalf of investors - taking advantage of short-term opportunities or managing short-term risks - particularly in volatile markets.
Types of Multi-asset Funds
Income Funds
These funds can be a useful addition to portfolios where an investor seeks to receive a distribution or payout from the fund on a regular basis. Distribution payouts can be based purely on dividends, purely on bonds, or a mix of different asset classes. They may be designed to be regular and consistent (which may occasionally require a return of capital), or regular, but inconsistent (paying out only what the investment earns.)
Target Risk Funds
These funds are generally focused on seeking to achieve growth and/or income within a specific volatility range. The managers use multiple asset classes to help balance the risk and return of the fund consistent with the level of risk tolerable by the investor. For example, an investor who has a low tolerance for investment risk may choose a “conservative” fund, whereas an investor who can tolerate more risk might choose “moderate”, “aggressive” or “growth” target risk funds.
Target Date Funds
These funds are typically associated with education planning or retirement planning. An investor chooses a date sometime in the future when the funds will be needed for a specific purpose. The funds follow a “glide path” of exposure to growth-based assets, reducing the exposure to equity risk as the date nears.
Fund of Funds
A "fund of funds" is a mutual fund that typically invests in 10-20 mutual funds or ETFs from different asset classes instead of investing directly in stocks or bonds. These funds offer similar multi-asset benefits to a model portfolio, but within a single mutual fund structure. Ongoing allocations are managed by a portfolio construction expert and administered directly within the mutual fund structure.
Balanced Funds
A balanced fund typically includes a combination of stocks and bonds in a fixed percentage, such as 80/20, 50/50, or 20/80. Balanced funds are designed for investors who want a mixture of safety and capital appreciation. Typically, balanced funds have less risk than a pure equity fund, but more risk than a pure fixed income fund.
Model Portfolios
Model portfolios often comprise a suite of roughly 10-20 mutual funds from different asset classes in recommended proportions. The models are designed towards specific investment outcomes such as “income”, “tax-advantaged”, “stability”, or “moderate growth”, among other combinations. Portfolio construction experts assemble the model and monitor it over time, making adjustments to the model as markets change.
Systematic Strategies
Systematic strategies are funds that use analytical models to determine which investments to select, in what proportion, and when to make changes. They may be based purely on factor research or may also be a blend of quantitative and fundamental research.
Featured Franklin Templeton Multi-asset Funds
Franklin Income Fund - Advisor Class
The fund seeks to maximize income, while maintaining prospects for capital appreciation, by investing in a diversified portfolio of stocks and bonds.
- Asset Class
- Multi-Asset
Franklin Managed Income Fund - Advisor Class
The fund seeks to maximize income to support monthly distributions while maintaining the prospects for capital appreciation. The fund invests in a diversified portfolio of stocks and debt securities and employs a managed distribution policy that is intended to provide level monthly payments.
- Asset Class
- Multi-Asset
Franklin LifeSmart 2030 Retirement Target Fund - Advisor Class
The fund seeks the highest level of long-term total return consistent with its asset allocation. Total return consists of both capital appreciation and income, with the fund placing an increasing emphasis on fixed income investments as the target date 2030 approaches, and reaching its final and most conservative asset allocation in approximately eight years after the target year. The fund invests primarily in a combination of other Franklin Templeton mutual funds and Franklin Templeton and third party exchange-traded funds (ETFs).
- Asset Class
- Multi-Asset
Our Extensive Multi-asset Investment Capabilities Include:
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Commitment to Active Management
Our belief in the value of active management has consistently guided our investment decisions and differentiates us from passive investors.
Decades of Specialized Expertise
Our seasoned teams, each providing differentiated style and perspective, build portfolios based on proprietary methodologies.
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The around-the-clock support of our global investment platform allows our investment teams to focus on research and portfolio management.
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This website does not provide investment advice or investment recommendations. It is intended for educational and informational purposes only.
All investments involve risks, including possible loss of principal.
Generally, those offering potential for higher returns are accompanied by a higher degree of risk. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Bond prices are affected by interest rate changes. Bond prices, and thus a bond fund's share price, generally move in the opposite direction of interest rates. As the price of bonds in a fund adjusts to a rise in interest rates, the fund's share price may decline. High-yield, lower-rated ("junk") bonds generally have greater price swings and higher default risks. Foreign investing, especially in developing markets, has additional risks such as currency and market volatility and political or social instability. For tax-free income funds, the alternative minimum tax may apply. These and other risks pertaining to specific funds, such as those involving investments in specialized industry sectors or use of complex securities, are discussed in each fund's prospectus. By clicking on the fund name, you will be taken to a more detailed fund information page which includes main investments and risks.
Your clients should carefully consider a fund's investment goals, risks, charges and expenses before investing. Download a prospectus, which contains this and other information. Your clients should carefully read a prospectus before they invest or send money.