Franklin Income Equity Focus ETF

Franklin Income Equity Focus ETF (INCE) is an actively managed Franklin Templeton fund. It mixes dividend-paying US stocks and preferred stock with equity-linked notes, which are bank-issued notes that pair a stock or index with an options trade to produce income. It pays monthly, with a trailing yield of 4.87% as of October 27, 2026. It aims for smaller swings than the S&P 500 and charges 0.29% a year, below the 0.41% average of similar funds.

• Over the year to Oct 27, 2026, INCE returned +20.3%, 3rd of 7 among similar funds.
• Its worst full calendar year was 2025 (+15.9%); its best was 2025 (+15.9%).
• The deepest fall in its price history was 14% (Nov 26, 2024 to Apr 8, 2025), recovered by Jun 30, 2025.

As of Jun 30, 2026, the fund held 95 securities; the ten largest made up 22.77% of assets, and 3.67% sat in cash and money-market holdings.

By sector

The bonds mature in 0.5 years on average (weighted by size), with an average coupon of 809.61%.

• Over the three months to Jun 30, 2026, investors added a net $10.2M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +3.70%, +1.48%, -1.11%.

INCE is actively managed, so it doesn't track an index. Its managers aim for income and capital growth, with returns that swing less than the S&P 500. Normally at least 80% of net assets goes into equity securities: common stocks, preferred stocks, convertible securities and instruments with similar exposure. The managers look for undervalued or out-of-favor companies with attractive dividends. They weigh cash flow, dividend coverage, debt maturities, management strength and sensitivity to interest rates. The prospectus sets no weighting formula or rebalancing calendar. Portfolio turnover was 69%.

The fund can put up to 50% of assets in equity-linked notes (ELNs). An ELN is a note, usually issued by a bank, that combines a stock or index with an option in one security. When that option is a sold call, the note pays extra income but gives up gains above a set level. ELNs also carry the risk that the issuing bank fails to pay. As of June 30, 2026, the fund held 52.8% in stocks, 15.7% in preferred stock and 28.3% in bonds and notes. The notes came from banks such as Royal Bank of Canada, Toronto-Dominion Bank and BNP Paribas and had about six months left to maturity on average.

The fund may also invest up to 25% abroad and use options, futures and currency contracts, but it isn't required to. Its June 30, 2026 report showed no derivative positions. In some circumstances it may aim for fairly stable monthly payouts.

• INCE charges 0.29% a year, versus an average of 0.41% for the similar funds below (3rd of 7, cheapest first).
• Using the prospectus's standard example, $10,000 invested would cost about $30 in the first year and $369 over 10 years (assuming a 5% annual return).

INCE pays monthly with a 4.87% trailing yield and aims for smaller swings than the S&P 500, so income is its main job.

INCE may add monthly income. Its trailing 12-month yield was 4.87% as of October 27, 2026, and it costs 0.29% a year. It launched in 2016, so it has no 2008 record. It fell 18.84% in the first quarter of 2020 but ended that year up 12.45%. Its worst calendar year was 2022, when it lost 8.48%. Price history starts in May 2024. In that period its deepest drop was 14%, from November 26, 2024 to April 8, 2025, and it recovered in about 2.7 months.

Anyone selling shares or drawing income during those drops would still have locked in losses. The income focus also costs something in strong markets. Through December 31, 2025, its five-year average return of 10.49% trailed the S&P 500's 14.43%. Much of the income may be taxed as ordinary income. Past results don't predict future ones, and a plan should look at the whole portfolio, not one fund.

Matched by closest holdings overlap from the latest N-PORT reports (no similar fund shares 20% or more of its holdings).