Franklin FTSE United Kingdom ETF (FLGB US) – Portfolio Construction Methodology

The underlying FTSE UK RIC Capped Index provides free-float market-cap exposure to UK large- and mid-cap equities from the FTSE UK Index Series. Eligibility requires UK nationality assignment and free float of at least 10% for UK-incorporated issuers (25% for non-UK incorporated), with ongoing liquidity based on median monthly turnover relative to shares in issue. Constituents are weighted by free-float market cap and then subject to US Regulated Investment Company caps each quarterly review: no single company >25% and the aggregate of >5% weights ≤50%. Standard FTSE buffers and fast-entry rules manage turnover between reviews. The index is reviewed quarterly (March, June, September, December), with changes effective after the close on the review Friday; capping is reapplied at each review to maintain diversification while retaining the underlying FTSE UK universe’s sector and size characteristics.

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