The latest news in investment offerings, financial products and other services relevant to wealth advisors and their clients.

Franklin Templeton
California-based investment manager Franklin Templeton has launched its first actively managed equity UCITS exchange-traded fund (ETF) for UK investors – the Franklin ClearBridge US Smaller Companies UCITS ETF.

The new ETF will be listed on the London Stock Exchange (LSE) on 3 November. The launch marks a milestone for Franklin Templeton in the UK market, expanding its active ETF suite into US equities and reinforcing its position in active ETF innovation across asset classes, investment styles, and geographies.

“This new offering will complement our existing UK fund range, which already provides investors with access to a comprehensive selection of US equity options, including active and passive strategies across small and large capitalisations,” Andrew Ashton, head of UK, Franklin Templeton, said. “The addition further strengthens our offering to ensure we are well-positioned to meet the needs of UK clients.”

The Franklin ClearBridge US Smaller Companies UCITS ETF aims to deliver long-term capital appreciation by identifying high-quality US growth companies early in their lifecycle – those with strong cash flows, resilient business models, and the potential to become the large-caps of tomorrow. 

The strategy provides diversification beyond mega-caps, offering broader access to US economic growth and exposure to early-stage innovators often overlooked in large-cap portfolios.

Managed by ClearBridge Investments, a specialist investment manager of Franklin Templeton with over $200 billion in assets, the strategy aims to achieve true alpha through bottom-up stock selection, dynamic risk management, and long-term conviction.

“The UK ETF market is maturing rapidly, with investors increasingly using ETFs not just for broad market exposure but for more targeted, outcome-driven allocations. Active ETFs have a vital role to play in this evolution, enabling investors to pursue active strategies with the same efficiency, cost-effectiveness and liquidity that they expect from traditional ETFs," Lotfi Ladjemi, vice president, ETF distribution for UK, Franklin Templeton added.

“We believe this is a particularly compelling time for small-cap investing. Smaller US companies are trading at historically attractive valuations relative to large caps, yet many display robust fundamentals and long growth runways,” Aram Green, portfolio manager, ClearBridge Investments, said.

The firm has a made a number of launches of ETFs across Europe and the US recently, including two new actively managed international equity ETFs,which offer investors approaches to accessing opportunities outside the US. 

Invesco
US-headquartered Invesco has launched a suite of highly liquid cash management exchange-traded funds with a structural advantage of offering the potential for higher returns than are typically available from deposit accounts. Cash management funds have captured over a third of all fixed income ETF flows since the start of the year, as investors seek for ways to make their cash work harder, particularly with central banks cutting interest rates, the firm said in a statement. They include:

-- Invesco euro Overnight Return Swap UCITS ETF
-- Invesco sterling Overnight Return Swap UCITS ETF
-- Invesco dollar Overnight Return Swap UCITS ETF 

Each of the Invesco ETFs aim to replicate the performance of a Solactive index, minus the impact of fees, which reflects the overnight interest rates that banks would pay to borrow from other financial institutions. The benchmark overnight interest rates are calculated and published daily by the European Central Bank (ECB), the Bank of England or the Federal Reserve as appropriate. 

The funds aim to achieve their objective through the use of unfunded swaps, which are agreements between the fund and its set of approved counterparties, in which the two parties exchange two streams of cash flows. 

“We expect this type of liquid, overnight return product to be particularly attractive to investors who have excess capital sitting idly in cash, possibly waiting to redeploy it into risk assets or who are in the middle of portfolio transitioning,” Paul Syms, head of EMEA ETF fixed income and commodity product management at Invesco, said. “Our new ETFs allow those investors to remain out of the market while still earning a highly competitive yield and without having to take on duration and other risks associated with cash management funds that generate their yield by holding fixed income securities.”

Like Franklin Templeton, the firm has launched a number ETFs recently, including an ETF designed to track (minus fees) a version of the S&P 500 index, aligned with meeting a 1.5°C limit on climate warming, using a forward-looking transition pathway model. Invesco has also launched three thematic ETFs to provide investors access to the long-term trends of artificial intelligence, cybersecurity and defence. See more here.

Eiffel Investment Group, Van Lanschot Kempen Investment Management
Eiffel Investment Group, a Paris-headquartered investments firm operating in several European centres, has launched a fund that is solely for clients of Amsterdam-based Van Lanschot Kempen Investment Management.

The fund focuses on European private debt investments, starting with a commitment from Pensioenfonds PostNL and Stichting De Samenwerking, Pensioenfonds voor het Slagersbedrijf of €220 million ($254.4 million). It targets a total size of €500 million.

The fund consists of two sub-funds, each pursuing a distinct impact-driven private credit strategy. One sub-fund finances small- and medium-sized enterprises (SMEs) and energy transition projects in the Benelux region, while the other provides short-term secured loans for energy infrastructure across Europe.

The fund also follows “an ambitious” sustainability and impact approach, Eiffel said in a statement yesterday.

The programme is open to additional institutional investors.