ETF Evaluator: Franklin High Yield Corporate ETF () Follow This ETF

Franklin High Yield Corporate ETF Overview

Franklin High Yield Corporate ETF (FLHY) is an actively managed Taxable Bond High Yield Bond exchange-traded fund (ETF). Franklin Templeton Investments launched the ETF in 2018.

The investment seeks to earn a high level of current income; its secondary goal is to seek capital appreciation to the extent it is possible and consistent with the fund's principal goal. Under normal market conditions, the fund invests at least 80% of its net assets in high yield corporate debt securities and investments that provide exposure to high yield corporate debt securities. It may invest up to 100% of its total assets in high yield debt securities. The fund may invest in debt securities of U.S. and foreign issuers, including those in developing or emerging markets. These securities may be U.S. dollar or non-U.S. dollar denominated.

About Franklin High Yield Corporate ETF (FLHY)

There are 4 members of the management team with an average tenure of 4.02 years: Bryant Dieffenbacher (2024), Jonathan Belk (2020), Robert Salvin (2026) and Glenn Voyles (2018). Management tenure is more important for actively managed ETFs than passive index ETFs.

The ETF has 2 primary benchmarks: Bloomberg US Agg Bond TR USD index with a weighting of 100% and ICE BofA US HY Constnd TR USD index with a weighting of 100%. Franklin High Yield Corporate ETF has 298 securities in its portfolio. The top 10 holdings constitute 8.8% of the ETF’s assets. The ETF meets the SEC requirement of being classified as a diversified fund. The ETF is not considered to have an ESG focus with its investment selection and management.

Franklin High Yield Corporate ETF is part of the Fixed Income global asset class and is within the Taxable Bond ETF group. Franklin High Yield Corporate ETF has 17.5% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 0.0% There is 0.0% allocated to foreign stock, and 0.5% is allocated to preferred stocks. The bond allocation as a percentage of total assets is 97.5% (80.0% domestic bond, 17.5% foreign bond and 0.1% convertible bond). Franklin High Yield Corporate ETF has 1.5% of the portfolio in cash.

Assets Under Management

The fund has $1 billion in total assets, which is below the $1 billion average for the High Yield Bond category. Normally, lower assets under management translates to higher average expense ratios, and greater total assets are desired. However, for some investment categories, such as small-cap investing, it may be difficult for the manager to fully employ the desired active strategy if assets grow too large or too quickly.

FLHY Performance and Fees

The expense ratio measures how much of a fund’s assets are used for administrative expenses and operating expenses, including adviser fees and fees for the transfer agent and custodial services. The Franklin High Yield Corporate ETF expense ratio is average compared to funds in the High Yield Bond category. Franklin High Yield Corporate ETF has an expense ratio of 0.40%, which is the same as its category average, making the fund expense ratio grade a C. While it is difficult to predict returns, it is known that high annual expense ratios reduce your rate of return, and excessive fees are difficult to overcome. Active management normally comes with higher expense ratios than passive index management. Certain investment categories such as small company and foreign also normally have higher expense ratios. It is best to compare fund expense ratios against the category averages for meaningful assessments.

High portfolio turnover can translate to higher expenses and lower aftertax returns. Franklin High Yield Corporate ETF has a portfolio turnover rate of 36%, which indicates that it holds its assets around / 0.0 years. By way of comparison, the average portfolio turnover is 69% for the High Yield Bond category.

Recently, in the month of July 2026, Franklin High Yield Corporate ETF returned -0.2%, which earned it a grade of C, as the High Yield Bond category had an average return of -0.2%. The letter grades of A, B, C, D and F are based upon relative rankings within the investment category. A grade of A, for example, would indicate that the return is in the highest 20% for that time period compared to all ETFs in that category.

Franklin High Yield Corporate ETF has a trailing yield of 6.52%, which is below the 6.77% category average. The fund normally distributes its income monthly and its capital gains annually.

It’s natural to seek the best-performing investments, but you must consider the relationship between risk and return and the impact of costs and taxes on your realized returns.

Franklin High Yield Corporate ETF Grades

Year to date, the ETF has returned 1.8%, 0.1 percentage points better than the category, which translates into a grade of C. The fund has returned 5.9% over the past year (grade of A), 8.6% over the past three years (grade of A) and 4.5% per year over the past five years (grade of B).

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