Moats for the US-Based Traditional Asset Managers Like Franklin Resources Continue to Diminish

Franklin has historically had the capital required to effect change but has, in our view, been lackluster about attacking deficiencies in its operations (especially when addressing poor performance results on the part of its portfolio managers). While we're encouraged that current management has been more aggressive about shaking things up, meaningful changes in research and investment processes and subsequent improvements in investment performance will take time.