Franklin High Income Fund Q3 2024 Commentary (FHAIX)

Fund details

Creation date

12/31/1969

Benchmark

ICE BofA US High Yield Capped

Index

Description of the fund

The fund seeks high levels of current income with a secondary focus on capital appreciation by investing primarily in higher yielding, lower rated corporate bonds.

Not FDIC Insured | No bank guarantee | May lose value

Share class information

			Selling expenses		Cost			30-day SEC yield 2
	KUSIP	Ticker	Max	CDSC	Gross	Net	Without refusal		With refusal
Advisor class	353538309	MUTF:FVHIX	–	–	0.62%	0.61%		6.36%	6.37%
Class A	353538887	MUTF:FHQRX	3.75%	–	0.87%	0.86%		5.87%	5.88%

ICE BofA US Limited High Yield Index measures the performance of US dollar-denominated fixed rate non-investment grade corporate bonds and taxable corporate bonds. Source: The index data referenced herein is the property of InterContinental Exchange (“ICE”) and/or its licensors and is licensed for use by Franklin Templeton. ICE and its licensors disclaim any liability in connection with such use.

Investment team

Glenn Voyles, CFA Years of work in the company 31 Years of experience 31

Bryant Dieffenbacher, CFA

Years of work in the company 14 years of experience 17

S. James McGiveran III, CFA

Years of work in the company 18 years of experience 18

Patricia O’Connor, CFA Years of work in the company 27 Years of experience 28

Periods shorter than one year are shown as cumulative total returns. An SEC fund’s 30-day return is calculated by dividing the net earnings (interest and dividends) per share earned over the most recent 30-day period (annualized) by the fund’s share price at the end of that period. It may not correspond to the fund’s actual distribution rate, which reflects the fund’s past dividends paid to shareholders.

What are the risks?

All investments involve risks, including possible loss of principal. Bonds with low rating and high yield subject to greater price volatility, illiquidity and the possibility of default. Credit rating changes bonds, the credit rating or financial strength of the issuer, insurer, or guarantor of the bond can affect the price of the bond. Fixed Income Securities involve interest rate, credit, inflation and reinvestment risks, as well as the possible loss of principal. As interest rates rise, the value of fixed income securities falls. International investments are subject to special risks, including currency fluctuations and social, economic and political uncertainties, which may increase volatility. These risks increase in emerging markets. The manager may consider environmental, social and governance (“ESG”) criteria in the research or investment process; however, ESG considerations may not be the determining factor in security selection. In addition, a manager cannot evaluate every investment against ESG criteria, and not every ESG factor can be identified or assessed. These and other risks are discussed in the fund’s prospectus.

Important information

The information provided is not a complete analysis of all material facts relating to any country, market, industry, security or fund. Because market and economic conditions are subject to change, commentary, opinions and analysis are provided as of the date of publication of this material and are subject to change without notice. A portfolio manager’s evaluation of a particular security, investment or strategy does not constitute an individual investment recommendation or a recommendation or offer to buy, sell or hold any security or to adopt any investment strategy; it is intended only to provide insight into the fund’s portfolio selection process. Holdings are subject to change.

Please consider the fund’s investment objectives, risks, charges and expenses carefully before investing. This and other information can be found in each prospectus or in the summary prospectus, when available, at: www.franklintempleton.com. Please read it carefully.

Franklin Distributors, LLC. Member FINRA/SIPC.

CFA® and Chartered Financial Analyst® are trademarks of the CFA Institute.

Source: FactSet. Important data provider notices and terms are available at www.franklintempletondatasources.com.

Gross expenses represent the fund’s total annual operating expenses as determined by the fund’s prospectus available at the time of publication. Actual expenses may be higher and may affect portfolio returns. Net expenses reflect contractual fee waivers, expense limitations and/or expense reimbursements that cannot be terminated prior to January 31, 2025 without the approval of the Board of Directors. Additional amounts may be voluntarily canceled and/or refunded and may be changed or discontinued at any time without notice. The return quotations for this class reflect the following calculation methods: a) For periods prior to the inception date of the fund’s Advisor class, a restated figure is used that is based on the performance of the fund’s oldest share class, Class A1, without taking into account the impact of the maximum initial price of Class A1. sales charge but reflecting the impact of Class A1 fees under Rule 12b-1; and for periods after the fund’s Advisor class inception date, the actual Advisor class performance is used to reflect all fees and charges applicable to that class. As of September 10, 2018, Class A shares were closed to new investors, were renamed Class A1 shares, and new Class A shares with a different cost structure became available. Class A returns shown have been calculated as follows: (a) For periods prior to 09/10/2018, a restated return based on the fund’s Class A1 performance and including any difference in Rule 12b-1 rates existing between Class A1 and Class A1 is used. Class A; and (b) for periods after 09/10/2018, actual Class A figures are used to reflect all fees and charges applicable to that class.