DIVI

DIVI applies a dividend yield tilt to its Parent Index, the Morningstar Developed Markets ex-North America Target Market Exposure Index. The underlying index includes large- and mid-cap stocks from its Parent Index. Then, it applies optimization to the trailing 12-month dividend yields of the eligible securities which may include applying sector, country, and turnover constraints. This process tends to favor high dividend yielding companies. Ultimately, the fund is designed to achieve higher dividend yields than its Parent Index, while limiting tracking errors. Prior to Aug. 1, 2022, the fund is named Franklin LibertyQ International Equity Hedge ETF (FLQH) and tracked the LibertyQ International Equity Hedged Index which provided a factor-based approach to the holdings of the MSCI EAFE Index.