Toronto-based Franklin Templeton Investments Corp. Tuesday introduced Franklin U.S. Rising Dividends Hedged Corporate Class for Canadian investors looking to minimize currency exposure while investing in American equities.
The new fund invests in U.S. companies that have had consistently rising dividends in at least eight of the past 10 years.
“Canadians are looking to invest in U.S. dividend stocks for growth but do not want to take on currency risk,” said Ronice Barlow, head of strategic planning & business development – Canada, Franklin Templeton Investments Corp. “Franklin U.S. Rising Dividends Hedged Corporate Class seeks to provide long-term capital appreciation while reducing the impact of currency fluctuations.”
The new fund reduces the potential effect of exchange rate fluctuations between the Canadian and U.S. dollars by investing in forward contracts. The fund will invest in units of Franklin U.S. Rising Dividends Fund.
“We focus on investing in high quality companies that have significant dividend growth potential over the long term,” said Don Taylor, lead manager of Franklin U.S. Rising Dividends Fund since 2005. “Our strategy is an alternative to investing in current yield-oriented equities, many of which have become expensive in today’s low-yield environment.”
Taylor is with Franklin Advisory Services, LLC, based in Fort Lee, New Jersey, and is also the lead manager of the U.S.-based Franklin Rising Dividends Fund.
Franklin U.S. Rising Dividends Hedged Corporate Class is part of Franklin Templeton’s Corporate Class structure, which allows investors to switch between funds and portfolios while deferring any taxable dispositions until they redeem from the structure.
The new fund is also available in a Series T version designed to provide investors with tax-efficient monthly cash flows through Return of Capital.