Franklin Templeton Opens up Japan to European Investors and Eyes a Solana ETF

30 Key Takeaways

• Franklin Templeton has made it easier for European investors to gain exposure to the Japanese equity market.
• The Exchange-Traded Fund (ETF) provides broad exposure to over 500 of Japan’s largest companies.
• The asset manager is expected to push for a Solana-based ETF soon.

Franklin Templeton is expanding its exchange-traded fund (ETF) offerings for European investors with a new fund focused on the Japanese equity market. The FTSE Japan ETF provides European customers with diversified exposure to over 500 large and mid-cap Japanese companies.

However, while the asset manager focuses on diversifying its ETF offer, it also eyes a possible new venture into the crypto world with a Solana (SOL)-based ETF.

Franklin Templeton Launches Japan ETF For EU Customers

Franklin Templeton has unveiled a new ETF designed to give European investors direct exposure to the Japanese equity market. The Franklin FTSE Japan UCITS ETF tracks the FTSE Japan Index, offering access to over 500 large and mid-cap Japanese companies across a diverse range of sectors.

With Japan’s economy showing signs of recovery and the country’s increasing prominence in global technology supply chains, this ETF presents an opportunity for investors to capitalize on the potential growth of the Japanese market.

The fund boasts a competitive expense ratio of 0.09% and will be managed by Dina Ting, head of global index portfolio management, and Lorenzo Crosato, ETF portfolio manager, at Franklin Templeton.

Caroline Baron, head of ETF distribution for EMEA at Franklin Templeton, highlighted Japan’s market significance:

“Following decades of deflation, Japan’s central bank now sees a virtuous cycle between wages and prices, which should boost consumption and investment. Japan’s strong position in the global technology supply chain, especially semiconductors, along with a renewed focus on corporate governance and shareholder value, should benefit the domestic equity market.”

Companies Covered By The ETF

The ETF allows investors to pour money into the 500 largest Japanese companies by market capitalization. The largest holding in the ETF is Toyota Motor Corp, part of the Consumer Discretionary sector, with a weight of 5.1%. This translates to a market value of $102,415,140.52, with 5,405,400 shares held.

Following Toyota is Mitsubishi UFJ Financial Group from the Financials sector, representing 2.7% of the ETF’s weight. It is valued at $54,202,544.70, with 4,937,400 shares.

Sony Group Corp, another Consumer Discretionary stock, holds a 2.4% weight, valued at $47,348,669.68, with 549,900 shares. Hitachi Ltd, in the Industrials sector, accounts for 2.1% of the ETF, valued at $41,303,320.42, with 2,024,100 shares.

Sumitomo Mitsui Financial Group, from the Financials sector, makes up 1.9% of the ETF, valued at $38,571,478.82, with 561,600 shares.

In the Information Technology sector, Keyence Corp represents 1.9% of the ETF, valued at $38,103,576.51, with 88,734 shares. While Tokyo Electron Ltd has a weight of 1.8%, valued at $35,787,361.19, with 198,900 shares. Shin-Etsu Chemical Co Ltd in the Materials sector has a weight of 1.76%, valued at $35,548,918.49, with 865,800 shares.

Mitsubishi Corp, an Industrials sector stock, represents 1.7% of the ETF, valued at $34,634,621.42, with 1,708,200 shares. Lastly, Recruit Holdings Co Ltd, also in the Industrials sector, holds a weight of 1.7%, valued at $33,642,977.17, with 643,500 shares.

FT Also Joins Crypto ETF Party

Franklin Templeton has also made a significant entry into the crypto ETF market . It recently launched a Bitcoin ETF on CBOE, which boasts total assets of $464.13 million. This has delivered a market price return of approximately 29% to date.

The company has also ventured into Ethereum ETFs, offering zero fees until January 31, 2025. After that date, a sponsor fee of 0.09% will apply.

Now, Franklin Templeton is exploring the potential for a Solana-based ETF. “Beyond Bitcoin and Ethereum, we see other exciting developments driving the crypto space forward,” the firm stated in a post on X on Jul 23, 2024.

“Solana has demonstrated significant adoption and continues to mature, overcoming technological challenges and showcasing the potential of high-throughput, monolithic architectures,” Franklin Templeton added, emphasizing the blockchain’s promising future.