The Franklin U.S. Mid Cap Multifactor Index ETF (FLQM) was launched on April 26, 2017, and is a passively managed exchange traded fund designed to offer broad exposure to the Mid Cap Blend segment of the US equity market.
The fund is sponsored by Franklin Templeton Investments. It has amassed assets over $1.77 billion, making it one of the average sized ETFs attempting to match the Mid Cap Blend segment of the US equity market.
Why Mid Cap Blend
With market capitalization between $2 billion and $10 billion, mid cap companies usually contain higher growth prospects than large cap companies, and are considered less risky than their small cap counterparts. Thus, companies that fall under this category provide a stable and growth-heavy investment.
Blend ETFs are aptly named, since they tend to hold a mix of growth and value stocks, as well as show characteristics of both kinds of equities.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.3%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.47%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector -- about 21% of the portfolio. Consumer Discretionary and Financials round out the top three.
Looking at individual holdings, Tapestry Inc (TPR) accounts for about 1.2% of total assets, followed by Ulta Beauty Inc (ULTA) and Dollar General Corp (DG).
The top 10 holdings account for about 11.33% of total assets under management.
Performance and Risk
FLQM seeks to match the performance of the LibertyQ U.S. Mid Cap Equity Index before fees and expenses. The LibertyQ U.S. Mid Cap Equity Index includes U.S. mid-capitalization companies that have favorable exposure to four investment style factors - quality, value, momentum and low volatility.
The ETF has added roughly 1.33% so far this year and was up about 3.19% in the last one year (as of 01/21/2026). In the past 52-week period, it has traded between $46.92 and $58.50.
The ETF has a beta of 0.98 and standard deviation of 14.72% for the trailing three-year period. With about 207 holdings, it effectively diversifies company-specific risk.
Alternatives
Franklin U.S. Mid Cap Multifactor Index ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, FLQM is a reasonable option for those seeking exposure to the Style Box - Mid Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The Vanguard Mid-Cap ETF (VO) and the iShares Core S&P Mid-Cap ETF (IJH) track a similar index. While Vanguard Mid-Cap ETF has $92.73 billion in assets, iShares Core S&P Mid-Cap ETF has $107.38 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Franklin U.S. Mid Cap Multifactor Index ETF (FLQM): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
