There was a change to the Franklin International Equity Rotation model this past week.

South Korea was an area of extreme relative strength earlier this year, and despite a recent pullback, the fund is up more than 75.3% since the start of the year. That said, the Franklin FTSE South Korea ETF (FLKR) is down 22.3% from its all-time highs, leaving it now on a string of three consecutive sell signals. Downward action in recent months pushed the name into the bottom half of the Franklin International Equity Rotation matrix, triggering it to be sold within the model. During its time as a holding, FLKR rose more than 75% from its original price, handily outpacing the broader international market.

In South Korea’s place, the Franklin model bought the next highest ranked country fund: the Franklin FTSE United Kingdom ETF (FLGB). UK equities have been an area of strength for some time, trading in a positive trend going back to 2022 while on a buy signal since May 2025. FLGB also regained near-term relative strength versus the domestic equities in February, sitting on an RS buy signal versus the S&P 500 equal weight index (SPXEWI). The fund sits in extremely actionable territory near the middle of its ten-week trading band, with support nearby at $33.50 and then $32. After today’s trade, the Franklin International Equity Rotation Model now holds 40% exposure to Asia, 20% to Latin America (Brazil), 20% to North America (Canada), and the remaining 20% to Europe (UK).

This section of the report categorizes select Franklin ETFs by their respective broad group. Along with each group, you can view the Average Group Score, which is an average of the scores of all funds represented in that particular group. Those Franklin ETFs that meet or exceed the Average Group Score will be highlighted in green in order to easily view those ETFs that have superior strength within their respective group. You want to focus on those ETFs that exhibit superior strength when looking to add new exposure to a particular group.

The distribution curve places each ETF on a bell curve according to their respective degrees of overbought or oversold status using a 10-week distribution. ETFs that are statistically oversold will appear on the left-hand side of the bell curve, while those that have become statistically overbought will appear on the right-hand side of the bell curve. Perhaps the most useful attribute of this feature is that it displays the entire universe on the curve at one time to give us a general picture of whether the Franklin ETF universe is generally overbought on a near-term basis, or generally oversold. Our best opportunities are to buy strong relative strength ETFs that have regressed back toward mean conditions based on market weakness, or have become oversold based upon extreme market weakness. Weekly Distribution is a short-term gauge that is most helpful in timing entry and exit points, while the longer-term information of trend and relative strength is a more controlling factor in the decision of whether to buy or sell.

Legend:

• UPPERCASE indicates that the RS chart is on a buy signal.
• lowercase indicates that the RS chart is in a sell signal.
• GREEN lettering indicates the ETFs trend chart is on a buy signal.
• RED lettering indicates the ETF is on a sell signal.
• Box Color indicates the Sector Status Rating. Green = Favored, Yellow = Average, and Red = Unfavored.

The Franklin LibertyShares International Model is designed to identify major country and regional themes in the international marketplace through the use of the Point & Figure relative strength tools. For more information on the portfolio construction and back testing, see the model info file on the models page.  (Note: The Franklin LibertyShares ETF Models will be updated Thursday mornings by 9:30 am EST) 

Weekly Changes: 

* - Dates prior to 09/01/2018, which is when the Franklin LibertyShares ETF Model became available on the NDW Research Platform, are representative of when the position was added to the backtested model.