Franklin VolSmart Allocation VIP Fund
Data updated: 2025-11-24
C000125190 — Franklin VolSmart Allocation VIP Fund. Alternative · $132.81M AUM · 0.90% expense ratio. Holdings, fees, performance and SEC filings.
C000125190 Fund Overview
Franklin VolSmart Allocation VIP Fund is a US mutual fund managed by Franklin Templeton Variable Insurance Products Trust, categorised as Alternative. ABC INVEST provides holdings, performance, costs, cashflows, risk data, prospectus documents and SEC filings, sourced from SEC filings.
- Type: US mutual fund
- Manager: Franklin Templeton Variable Insurance Products Trust
- Category: Alternative
- Assets under management: $132.81M
- 1-year return: 5.0%
- SEC CIK: 0000837274
- SEC series ID: S000040299
- Share class ID: C000125190
C000125190 Investment Objective and Strategy
Franklin VolSmart Allocation VIP Fund describes its objective and strategy as follows, from its latest prospectus filed with the SEC by Franklin Templeton Variable Insurance Products Trust.
Investment objective
Total return (including income and capital gains) while seeking to manage volatility.
Principal investment strategy
"Under normal market conditions, the Fund seeks to achieve its investment goal by allocating its assets across certain asset classes, sectors and strategies in an attempt to produce a diversified portfolio that will generate returns while minimizing the expected volatility of the Fund's returns so that volatility does not exceed a target of 10% per year (volatility within the 10% target is referred to as ""Target Volatility""). Managing the Fund to remain within its Target Volatility is designed to reduce the potential dramatic and rapid price swings that could be experienced by the Fund's ""core portfolio."" The Fund's assets are primarily invested in its ""core portfolio,"" which is principally comprised of various U.S. equity and fixed income investments and strategies including investments in other mutual funds that provide exposure to such investments and strategies, as described in more detail below.
The Fund's investment manager, Franklin Advisers, Inc. (Advisers), and the Fund's sub-advisor, K2/D&S Management Co., L.L.C. (K2 Advisors) allocate the Fund's assets among the strategies and investments in the core portfolio to diversify the assets of the Fund and to reduce the Fund's risk of being significantly impacted by changes in a specific asset class. In addition, Advisers and K2 Advisors employ two additional strategies to manage the Fund's risk exposure to market volatility and to extreme market downturns. Advisers and K2 Advisors employ a volatility management strategy, which is designed to manage the expected volatility of the Fund's returns so that volatility remains within the Fund's Target Volatility. In employing this strategy, Advisers and K2 Advisors measure the Fund's expected volatility and utilize certain derivative instruments (primarily futures contracts on indices) to adjust the Fund's expected volatility to within the Target Volatility, as described in more detail below.
There is no guarantee that the Fund will stay within its Target Volatility. K2 Advisors also employs a ""tail risk protection strategy,"" designed to protect the Fund from risks related to extreme short-term market downturns (tail risk). Tail risk refers to the possibility that the return on an investment (or portfolio) will deviate significantly outside of the average range within which an investment manager assumes an investment's (or portfolio's) returns will remain, resulting in unexpected and significant losses. K2 Advisors employs this strategy by utilizing certain derivatives (primarily total return swap agreements) to hedge the tail risk of the Fund. There is no guarantee that the Fund's volatility management or tail risk protection strategies will be successful. The Fund's Target Volatility is not a total return performance target – the Fund does not expect, nor does it represent, that its total return performance will be within any specified range.
It is possible that the Fund could stay within its Target Volatility while having negative performance returns. Also, efforts to manage the Fund's volatility and protect against tail risk can be expected to limit the Fund's gains in rising markets, may expose the Fund to costs to which it would otherwise not have been exposed, and if unsuccessful may result in substantial losses. The Fund is structured as a limited ""fund-of-funds"" that seeks to achieve its investment goal by investing its assets partially in other mutual funds, which include other Franklin Templeton mutual funds, and Franklin Templeton and third-party exchange-traded funds (ETFs) (underlying funds). Each underlying fund is allocated to the equity, fixed income, multi-class or cash asset class based on its predominant asset class and strategies.
These underlying funds, in turn, invest in a variety of U.S. and foreign equity, fixed-income and money market securities. The Fund also obtains exposure to certain strategies and investments in its core portfolio by directly investing in the securities and instruments in that strategy. The Fund may have a large percentage of its core portfolio assets invested in underlying funds at any given time; however, the Fund will not invest more than 25% of its assets in any one underlying fund at any given time. The Fund's investments in underlying funds will change over time depending on various factors, including general market conditions. K2 Advisors serves as sub-adviser to the Fund to assist in the management of the overall asset allocation, volatility management and tail risk protection strategies.
Core Portfolio Under normal market conditions, the Fund's core portfolio is allocated among the broad asset classes according to the following approximate percentages to achieve the Fund's asset allocation strategy: 50%-70% Equity Allocation 13%-33% Fixed Income Allocation 5%-15% Multi-Asset Class Allocation (combination of equity and fixed income) 2%-13% Cash (includes cash, cash equivalents and money market funds or securities) A large part of the Fund's equity allocation is directly invested in securities by Advisers pursuant to its rising dividends strategy. To the extent that Advisers and K2 Advisors allocate the Fund's assets to underlying funds, such allocations are based on the underlying fund's predominant asset class. These underlying funds invest in a variety of equity and fixed-income securities and may also have exposure to derivative instruments.
At the discretion of Advisers and K2 Advisors, the above percentages may vary from time to time without shareholder approval, e.g. , based on market conditions or the investment managers' assessment of an asset class' relative attractiveness as an investment opportunity or as part of the volatility management strategy. In addition, as a result of the Fund's use of derivatives, and/or in an effort to manage expected volatility, the Fund may hold significant amounts of cash, cash equivalents and money market instruments. When selecting equity funds for the Fund's core portfolio, Advisers and K2 Advisors consider a number of characteristics, including but not limited to, the underlying funds' market capitalization ranges, and investment style (growth vs. value). When selecting fixed-income funds for the Fund's core portfolio, Advisers and K2 Advisors consider a number of characteristics, including but not limited to, yield and price volatility.
In evaluating the risk level of the underlying funds, the Advisers and K2 Advisors analyze various characteristics including but not limited to: (a) relative and absolute performance, including correlations with other underlying funds as well as corresponding benchmarks, and (b) their volatility. Volatility Management Strategy The Fund employs a volatility management strategy that seeks to stabilize the number and level of performance swings of the Fund over time. Managing the Fund's volatility to within its Target Volatility is intended to reduce the downside risk of the Fund during periods of significant and sustained market declines. There is, however, no guarantee that the Fund will remain within its Target Volatility. In this context, ""volatility"" is a statistical measurement of the frequency and level of up and down fluctuations of the Fund's returns over time.
Volatility may result in rapid and dramatic price swings. Volatility, in other words, represents the average annual deviation of the Fund's return around the average Fund return. In employing this strategy, Advisers and K2 Advisors measure the expected annual volatility of the Fund's core portfolio. If the Fund's expected annual volatility exceeds the Target Volatility, the Fund will write (sell) one or more equity index futures contracts (usually S&P 500 Index futures contracts) with the goal of decreasing the core portfolio's exposure to U.S. equity securities so that the expected annual volatility of the Fund is at or below the target of 10%. Generally, Advisers and K2 Advisors intend to use the strategy to reduce risk and would not employ the volatility management strategy if the expected volatility of the Fund's core portfolio is at or below the Target Volatility.
The volatility strategy may cause the Fund's effective exposure to certain asset classes to be greater or less than its direct investments. Tail Risk Protection Strategy K2 Advisors also employs a tail risk protection strategy to provide protection against rare events that can significantly and negatively affect the portfolio, while attempting to preserve upside potential. In implementing the tail risk protection strategy, the Fund currently enters into one or more total return swaps on one or more systematic or quantitative rules-based indices that use a mathematical methodology to automatically increase or decrease exposure to short- and/or medium-term futures on an index that measures market expectations of volatility. K2 Advisors believes that exposure to a market volatility index through one or more swaps will mitigate tail risk because the Fund should experience a gain on the swap during negative market events, which will mitigate the Fund's losses in such an event.
The Fund expects to be engaged in one or more swaps on an index at all times to ensure continued exposure to the index, even in periods of low volatility when the index is exposed only to cash. In the future, however, the Fund may use other instruments to protect against tail risk. With respect to the Fund's derivative investments, the Fund may enter into equity index futures contracts and total return swap agreements in connection with the Fund's volatility management and tail risk protection strategies, respectively. In addition, the underlying funds may enter into various transactions involving complex derivative instruments for hedging or investment purposes."
C000125190 Holdings
Top 10 holdings of Franklin VolSmart Allocation VIP Fund by percentage of net assets, from the fund's latest SEC N-PORT filing.
| Holding | % of net assets |
|---|---|
| Franklin U.S. Core Bond ETF | 16.75% |
| Putnam Core Bond Fund | 8.46% |
| Franklin Income VIP Fund | 7.98% |
| Microsoft Corp. | 4.87% |
| Apple, Inc. | 3.50% |
| NVIDIA Corp. | 2.73% |
| Broadcom, Inc. | 2.51% |
| Franklin Institutional U.S. Government Money Market Fund | 1.89% |
| JPMorgan Chase & Co. | 1.35% |
| Walmart, Inc. | 1.32% |
C000125190 Portfolio Allocation
Asset-class allocation of Franklin VolSmart Allocation VIP Fund by percentage of net assets, from the latest SEC N-PORT filing.
| Asset class | Allocation |
|---|---|
| Equity | 64.6% |
| Other | 33.2% |
| Cash & Equivalents | 1.9% |
C000125190 Performance
Total returns for C000125190 (as of 2026-10-01), from SEC filings.
| Period | Total return |
|---|---|
| 1 year | 5.0% |
| 3 years (annualised) | 12.3% |
| 5 years (annualised) | 7.8% |
C000125190 Risk Information
Risk metrics for C000125190, derived from monthly returns in SEC filings.
- 1-year volatility (annualised): 8.7%
C000125190 Costs and Fees
C000125190 costs about $90 per $10,000 invested per year in fund expenses.
- Net expense ratio: 0.90%
- Gross expense ratio: 1.11%
- Portfolio turnover: 35%
- Brokerage commissions: 1.30 bps of average net assets (SEC N-CEN)
C000125190 Cashflows
Over the 12 months to 2025-09, Franklin VolSmart Allocation VIP Fund had net outflows of $7.64M, from monthly SEC N-PORT filings.
| Month | Net flow |
|---|---|
| 2025-09 | −$1.91M |
| 2025-08 | −$2.65M |
| 2025-07 | −$886.07K |
| 2025-06 | $16.41M |
| 2025-05 | −$1.31M |
| 2025-04 | −$2.02M |
C000125190 Debt Constituents
No individual debt constituents are reported in Franklin VolSmart Allocation VIP Fund's latest SEC N-PORT filing.
C000125190 Prospectus and SEC Filings
Official Franklin VolSmart Allocation VIP Fund filings on SEC EDGAR — prospectus, portfolio holdings and annual reports.
- Prospectus (485BPOS) — filed 2025-04-28
- Prospectus (485BPOS) — filed 2024-04-25
- Prospectus (485BPOS) — filed 2023-04-27
- Portfolio holdings (N-PORT) — filed 2025-11-24
- Portfolio holdings (N-PORT) — filed 2025-08-26
- Portfolio holdings (N-PORT) — filed 2025-05-28
- Annual census (N-CEN) — filed 2025-03-13
- Annual census (N-CEN) — filed 2024-03-08
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Data Sources
ABC INVEST compiles this page from public filings made to the U.S. Securities and Exchange Commission (SEC) through EDGAR: portfolio holdings and monthly cashflows from Form N-PORT, expenses and returns from fund prospectuses (Form 485BPOS) and the SEC DERA Risk/Return Summary data sets, annual data from Form N-CEN, and shareholder reports from Form N-CSR.