The folks at a $1.6-trillion-AUM (as of December 31), publicly traded, asset management titan are teaming up with New Frontier and VettaFi to launch a pair of new index funds.

Yesterday (January 23), Todd Mathias, head of U.S. ETF product strategy at Franklin Templeton [profile], and Robert Michaud, chief investment officer of New Frontier, unveiled the debut of the Franklin International Dividend Multiplier Index ETF (XIDV on the NYSE Arca, Inc.) and the Franklin U.S. Dividend Multiplier Index ETF (XUDV). San Mateo, California-based Franklin Templeton's Franklin Advisory Services, LLC serves as the new ETFs' investment advisor, while Franklin Templeton Institutional, LLC serves as subadvisor. New York City-based VettaFi LLC serves as index provider, while Boston-based New Frontier's proprietary optimization techniques help power the underlying indexes and thus the ETFs.

XUDV and XIDV's inception date was Tuesday (January 21). XIDV's expense ratio is 19 basis points, while XUDV's is 9bps. As of yesterday, XUDV had $1.27 million in AUM, while XIDV had $5.08 million.

The PM team for both XUDV and XIDV includes: Basit Amin, vice president at Franklin Advisory Services; Joe Diederich, portfolio manager at FT Institutional; Hailey Harris, PM at FT Institutional; and Ding Ting, SVP at Franklin Advisory Services. XIDV is designed to track the VettaFi New Frontier International Dividend Select Index, while XUDV is designed to track the VettaFi New Frontier U.S. Diviended Select Index.

Mathias describes the dual launch as a demonstration of "Franklin Templeton's commitment to expanding [its] suite of portfolio solutions in order to meet the evoling needs of ... clients."

"These ETFs provide cost-effective access to strategies that combine enhanced dividend income with next generation portfolio design, serving as a compelling option for investors seeking access to long-only equity income," Mathias states. "These strategies are particularly well-suited for fee-based advisors, sophisticated clients, and general retail investors seeking efficient, diversified equity solutions."

Michaud says the team up "marks a new era in both dividend investing and ETF innovation."

"These ETFs embody New Frontier's mission to solve complex investor challenges using optimization techniques, creating highly efficient portfolios for reliable, long-term wealth building," Michaud states. "By applying our time-tested optimization to dividend strategies, we've built an index to pursue enhanced dividend yield coupled with risk-managed capital appreciation. This launch is setting a new standard in the ETF industry through effective investment technology. We're confident these ETFs will redefine expectations for dividend-focused investments and demonstrate the power of advanced optimization in portfolio construction."

XUDV and XIDV are series of the Franklin Templeton ETF Trust. The new ETFs' other service providers include: Franklin Distributors, LLC as distributor; Franklin Templeton Services, LLC as administrator; Goldman Sachs Agency Lending as securities lending agent; PricewaterhouseCoopers LLP as independent accounting firm; and State Street Bank and Trust Company as dividend-paying agent, securities lending agent, sub-administrator, and transfer agent. 

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