Franklin Emerging Market Core Dividend Tilt Index ETF

Franklin Emerging Market Core Dividend Tilt Index ETF (DIEM) tracks a Morningstar index of about 570 large and mid-size emerging-market stocks. The index leans toward higher dividend payers but stays close to the broad market. Its 0.19% expense ratio is the lowest among the similar funds compared here, which average 0.73%. It is small, with about $60 million in net assets as of June 30, 2026, and leans heavily on Asian chipmakers.

• Over the year to Oct 27, 2026, DIEM returned +24.6%, 3rd of 5 among similar funds.
• Its worst full calendar year was 2024 (+12.3%); its best was 2025 (+30.8%).
• The deepest fall in its price history was 16.8% (Oct 7, 2024 to Apr 8, 2025), recovered by Jun 5, 2025.

As of Jun 30, 2026, the fund held 561 securities; the ten largest made up 37.25% of assets.

• Over the three months to Jun 30, 2026, investors added a net $4.0M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +13.54%, +12.34%, -0.64%.

DIEM tracks the Morningstar Emerging Markets Dividend Enhanced Select Index. Morningstar builds it from a broader parent, the Morningstar Emerging Markets Target Market Exposure Index. The parent holds large and mid-size stocks that make up the top 85% of emerging markets by float-adjusted market value, meaning only shares the public can actually buy are counted. Each quarter, an "optimizer" (a computer model) picks and weights stocks from the parent. Its goal is a higher trailing 12-month dividend yield while limiting tracking error, which is how far results drift from the parent.

Rules keep the tilt modest. No stock can exceed the lesser of three times its parent weight or its parent weight plus 0.5 percentage points. Sector and country weights stay within 5 points of the parent's. One-way turnover is capped at 20% at each rebalance. Because of these limits, the index holds some stocks that pay no dividend. As of May 31, 2026, it held 573 securities from countries including Taiwan, South Korea, China, India, Brazil and Saudi Arabia.

The fund keeps at least 80% of its assets in index stocks and depositary receipts, which are certificates representing foreign shares. It may hold every index stock or a representative sample. It can use futures and total return swaps to put spare cash to work. Portfolio turnover was 61% in the latest prospectus year.

• DIEM charges 0.19% a year, versus an average of 0.73% for the similar funds below (1st of 4, cheapest first).
• Using the prospectus's standard example, $10,000 invested would cost about $19 in the first year and $241 over 10 years (assuming a 5% annual return).

It offers low-cost emerging-market exposure with a dividend tilt, but its concentration in Asian chipmakers and its large swings make it better suited to a smaller slice of a portfolio.

DIEM could add emerging-market stocks and some dividend income at low cost. Under the SEC's standard example, its 0.19% fee comes to about $19 in the first year and $241 over 10 years on $10,000. It yielded 2.81% as of October 27, 2026, and pays quarterly. The swings can be large. The fund began in 2016, so it has no 2008 record. It fell 25.58% in the first quarter of 2020 but ended that year up 1.69%. It lost 20.16% in 2022, its worst calendar year. Price data begins in August 2022. Since then, its deepest drop was 16.8%, from October 2024 to April 2025, and it had recovered by June 2025. Selling shares in a year like 2022 would lock in losses, and companies can cut their dividends. Past results don't predict the future, and a plan should look at the whole portfolio, not one fund.

Matched by holdings overlap from the latest N-PORT reports.