Franklin Senior Loan ETF Franklin Liberty Senior Loan Fund

Franklin Senior Loan ETF (FLBL) is an actively managed Franklin Templeton fund. It holds senior loans to mostly below-investment-grade U.S. companies, and the interest rates on those loans float with benchmarks such as SOFR. Its trailing yield was 7.63% as of October 27, 2026, paid monthly. Its 0.45% expense ratio is lower than senior-loan peers BKLN (0.65%) and SRLN (0.70%), but its returns have trailed its benchmark loan index.

• Over the year to Oct 27, 2026, FLBL returned +3.1%, 3rd of 8 among similar funds.
• Its 5-year annualized return was +5.3%.
• In the 2020 COVID crash it fell 19.4% and regained its old high 7.6 months after the low.
• Its worst full calendar year was 2022 (-2.8%); its best was 2023 (+14.8%).
• The deepest fall in its price history was 19.5% (Jan 22, 2020 to Mar 23, 2020), recovered by Nov 10, 2020.

As of Jun 30, 2026, the fund held 281 securities; the ten largest made up 11.63% of assets, and 9.77% sat in cash and money-market holdings.

The bonds mature in 4.6 years on average (weighted by size), with an average coupon of 5.29%.

• Over the three months to Jun 30, 2026, investors added a net $48.3M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +0.99%, +0.58%, -0.03%.

FLBL does not track an index. Its managers pick the loans. At least 80% of net assets goes into senior loans, also called leveraged, bank or floating-rate loans. Their interest rates reset regularly to a base rate such as SOFR (the Secured Overnight Financing Rate) or the Prime Rate. These loans usually sit at the top of a company's debt and are backed by collateral, so if the company fails, the fund is typically repaid before unsecured lenders. The managers do their own credit analysis of each borrower and its collateral. They buy a loan when they judge the borrower can pay and the return justifies the risk. Turnover was 37%.

The fund has quality limits. At least 75% of net assets must be in loans rated B- or higher when bought. Up to 25% can go lower, including to companies in bankruptcy or restructuring. It may buy "covenant-lite" loans, which give lenders fewer rights to step in when a borrower struggles. Non-U.S. borrowers are capped at 25% of total assets. Up to 20% can go into other debt, and into stocks received alongside its loans.

The fund may use high-yield credit default index swaps to add or hedge credit risk. It held none as of June 30, 2026. At that date it had 281 holdings: 85.69% loans and 9.77% cash. The ten largest made up 11.63% of the fund, led by Peraton (1.3%), AmWINS Group (1.2%) and McAfee (1.2%).

• FLBL charges 0.45% a year, versus an average of 0.35% for the similar funds below (5th of 8, cheapest first).
• Using the prospectus's standard example, $10,000 invested would cost about $46 in the first year and $567 over 10 years (assuming a 5% annual return).

The fund's main goal is a high level of current income, paid monthly from floating-rate corporate loans.

FLBL could add monthly income that is less sensitive to rising interest rates than fixed-rate bonds. Its trailing yield was 7.63% as of October 27, 2026, and that income can fall when short-term rates fall. The trade-off is credit risk. In the 2020 COVID crash, its market price fell 19.4% between February 19 and March 23, 2020, and took about 7.6 months to recover. That would have been a hard time to sell shares for income. In 2022 it fell 6.8% at its low point and had recovered by January 2023. Its worst calendar year in the prospectus was 2022, at -1.36%. The fund launched in 2018, so it has no record from 2008. It costs 0.45% a year, or $46 in the first year on $10,000 under the SEC's standard example. Past results don't predict future ones, and a plan should look at the whole portfolio, not one fund.

Matched by bond funds with the closest average maturity and issuer mix (N-PORT).