Changes coming to Franklin Templeton fixed income fund

Toronto-based Franklin Templeton Investments Corp. announced changes to one of its fixed income funds on Monday.

Franklin Strategic Income Fund will undergo a number of changes, including a fee reduction, investment strategy change and the introduction of an active currency management strategy. The fund’s risk rating has also been lowered from “Low to Medium” to “Low.”

A portion of the fund’s foreign currency exposure will be actively managed by Calgary-based Franklin Bissett fixed income team.

Franklin Templeton Investments Canada president Duane Green said in a statement that the fund will also see a reduction in exposure to high-yield investments in order to achieve lower volatility. Franklin Strategic Income Fund’s high-yield holdings will be limited to 40% or less of total assets going forward, the firm said, “resulting in an increased emphasis on investment grade opportunities across fixed income sectors in which the fund currently invests.”

These changes will take effect April 22. Effective April 1, the management fee for series A and F will be reduced by 0.05%, and the management fees for series PA, PF, and O will be reduced by 0.10%.

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