Franklin Templeton investors may have to brace for another blow, with six of the fund house’s debt schemes having seen erosions of between six per cent and 25 per cent in their net asset values (NAVs). The six are so-called fund of fund (FoF) schemes, which invest in a basket of other mutual funds. The FoFs had varying degrees of exposure to the Franklin schemes that the fund house wound up, citing heavy redemption pressure amid illiquid market conditions.
Franklin Life Stage FoF 50s Plus has seen the deepest drop in NAV at 25.2 per cent, followed by Franklin Multi-Asset Solution Fund at 22 per cent and Franklin Life Stage at 17.8 per cent. The asset under management (AUM) of five of the six FOFs is less than Rs 25 crore. Franklin Dyanmic Asset Allocation FOF, which had an AUM of Rs 878 crore, has seen nearly 17 per cent drop in NAV.
“Pursuant to decision to wind up Franklin India Short Term Income Plan and Franklin India Dynamic Accrual Fund, announced on April 23, 2020, the investments by the Fund of Fund Schemes in the above-mentioned underlying schemes that are wound up were