Franklin International Core Dividend Tilt Index ETF

Franklin International Core Dividend Tilt Index ETF (DIVI) tracks a Morningstar index of roughly 400 large and mid-size companies in developed markets outside North America. The index leans toward higher dividend payers but stays close to the broad market. Its 0.09% expense ratio is the lowest of seven comparable funds, against a 0.24% average for the other six. The trade-off is that its one- and three-year returns trailed five of those six peers through October 27, 2026.

• Over the year to Oct 27, 2026, DIVI returned +15.4%, 6th of 7 among similar funds.
• Its worst full calendar year was 2024 (+2.4%); its best was 2025 (+34.9%).
• The deepest fall in its price history was 14.6% (Mar 19, 2025 to Apr 8, 2025), recovered by May 2, 2025.

As of Jun 30, 2026, the fund held 416 securities; the ten largest made up 14.23% of assets.

• Over the three months to Jun 30, 2026, investors added a net $89.8M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +7.99%, +3.19%, -0.32%.

DIVI tracks the Morningstar Developed Markets ex-North America Dividend Enhanced Select Index. That index starts from a parent, the Morningstar Developed Markets ex-North America Target Market Exposure Index. The parent covers the large and mid-size stocks that make up the top 85% of developed markets outside North America by float-adjusted market value, which counts only shares available to the public. Each quarter, an optimizer (a computer model) picks and weights stocks from the parent. It aims to raise the trailing 12-month dividend yield while keeping performance close to the parent's.

Guardrails keep the tilt modest. A stock's weight is capped at the lower of two limits: three times its parent-index weight, or its parent weight plus 0.5%. Sector and country weights must stay within 5% of the parent's. One-way turnover is capped at 10% per quarter, though that limit can be relaxed. Because of these rules, the index includes some companies that pay no dividend. As of May 31, 2026, it held 427 stocks, from Japan and the United Kingdom to Poland and Israel.

The fund keeps at least 80% of its assets in index stocks and depositary receipts (certificates that represent foreign shares). It rebalances quarterly, after the index does. It may hold every index stock or a representative sample. It can also use equity futures and total return swaps to track the index. As of June 30, 2026, its only futures position, on the MSCI EAFE Index, was a tiny fraction of assets. The prospectus lists portfolio turnover of 27%.

• DIVI charges 0.09% a year, versus an average of 0.24% for the similar funds below (1st of 7, cheapest first).
• Using the prospectus's standard example, $10,000 invested would cost about $9 in the first year and $116 over 10 years (assuming a 5% annual return).

It offers low-cost, broad exposure to developed-market stocks outside North America, with a modest tilt toward dividends rather than a concentrated income strategy.

DIVI could serve as a low-cost core for the international stock part of a portfolio, with some extra income. Its trailing 12-month yield was 3.69% as of October 27, 2026, paid quarterly. The fund did not exist in 2008. During the COVID crash it lost 16.51% in the quarter ended March 31, 2020, then finished 2020 up 1.55%. It lost 1.74% in 2022. Its weakest calendar year since 2017 was 2018, at −6.18%. Price data is only available from October 2022. In that period, its deepest drop was 14.6%, from March 19 to April 8, 2025, and it recovered by May 2, 2025.

Anyone selling shares in a bad stretch should be ready for sharp drops, currency swings and possible dividend cuts. Costs are low: $116 over 10 years in the SEC's $10,000 example. Past results don't predict future returns, and a plan should look at the whole portfolio, not one fund.

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