Posted inHead To Head, News

HEAD-TO-HEAD: Franklin Templeton versus Merian

FSA compares two US equity products: the Franklin Templeton US Opportunities Fund and the Merian North American Equity Fund.
by Francis Nikolai Acosta

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Conclusion

The Franklin Templeton fund receives a four-star Morningstar rating and an analyst rating of Neutral, while the Merian fund receives a four-star Morningstar rating and a Silver analyst rating.

Morningstar’s star rating looks at historical performance and the analyst rating is forward-looking.

Performance data shows the Templeton fund is clearly the stronger of the two. The Templeton fund’s three-year cumulative return was nearly 47% and slightly less than the benchmark (49.7%).

During the same period, the Merian fund returned only 11% — less than half of its benchmark return of 25%.

However, Khizou said she prefers the Merian strategy.

“It has proven the quality of its management and its process since it was put together.

“Obviously, 2019 was disappointing, but it has shown the ability to perform well in other challenging periods. On a risk-adjusted basis, it is a stronger proposition.”

Turning to the Franklin Templeton fund, Khizou explained that it received a lower analyst rating of Neutral as it has struggled to outperform its benchmark for long periods.

“Despite having a huge and stable team, the research does not seem to have been translated into a portfolio that reflects stock-picking skills.”

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