Franklin Strategic Series

04/30/2024 | Press release | Distributed by Public on 04/30/2024 05:21

Semi-Annual Report by Investment Company - Form N-CSRS

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM N-CSRS
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-06243
Franklin Strategic Series

(Exact name of registrant as specified in charter)
One Franklin Parkway, San Mateo, CA 94403-1906

(Address of principal executive offices)(Zip code)
Alison Baur, One Franklin Parkway, San Mateo, CA 94403-1906

(Name and address of agent for service)
Registrant's telephone number, including area code: 650 312-2000
Date of fiscal year end: 8/31
Date of reporting period: 2/29/24
Item 1. Reports to Stockholders.
a.)
The following is a copy of the report transmitted to shareholders pursuant to Rule30e-1 under the Investment Company Act of 1940, as amended (the "1940 Act") (17 CFR 270.30e-1.)

b.)
Include a copy of each notice transmitted to stockholders in reliance on Rule 30e-3 under the Act (17 CFR 270.30e-3) that contains disclosures specified by paragraph (c)(3) of that rule.
Not Applicable
.
Your
Fund's
Expenses
Franklin
Templeton
SMACS:
Series
CH
1
franklintempleton.com
Semiannual
Report
Shareholders
of
mutual
funds
incur
ongoing
costs,
such
as
management
fees
(if
any),
custodian
fees
and
other
Fund
expenses,
which
are
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
the
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Please
note
that
the
expenses
shown
in
the
table
are
meant
to
highlight
your
ongoing
Fund
costs
only
and
do
not
reflect
any
program
fees
that
you
may
pay.
Therefore,
the
table
is
useful
in
comparing
ongoing
costs
of
investing
in
the
Fund
only,
and
will
not
help
you
determine
the
relative
total
costs
of
participating
in
any
one
investment
program.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
"Actual."
In
these
columns
the
Fund's
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
"Ending
Account
Value."
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(
of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration
):
Divide
your
account
value
by
$1,000
(
if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6
).
Then
multiply
the
result
by
the
number
in
the
row
under
the
headings
"Actual"
and
"Expenses
Paid
During
Period"
(
if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50
).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
"Hypothetical"
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund's
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund's
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
"Hypothetical"
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above-in
the
far
right
column-multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
182/366
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Beginning
Account
Value
9/1/23
Ending
Account
Value
2/29/24
Expenses
Paid
During
Period
9/1/23-2/29/24
1,2
Ending
Account
Value
2/29/24
Expenses
Paid
During
Period
9/1/23-2/29/24
1,2
a
Net
Annualized
Expense
Ratio
2
$1,000
$1,035.90
$0.00
$1,024.86
$0.00
0.00%
Your
Fund's
Expenses
Franklin
Templeton
SMACS:
Series
E
2
franklintempleton.com
Semiannual
Report
Shareholders
of
mutual
funds
incur
ongoing
costs,
such
as
management
fees
(if
any),
custodian
fees
and
other
Fund
expenses,
which
are
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
the
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Please
note
that
the
expenses
shown
in
the
table
are
meant
to
highlight
your
ongoing
Fund
costs
only
and
do
not
reflect
any
program
fees
that
you
may
pay.
Therefore,
the
table
is
useful
in
comparing
ongoing
costs
of
investing
in
the
Fund
only,
and
will
not
help
you
determine
the
relative
total
costs
of
participating
in
any
one
investment
program.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
"Actual."
In
these
columns
the
Fund's
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
"Ending
Account
Value."
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(
of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration
):
Divide
your
account
value
by
$1,000
(
if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6
).
Then
multiply
the
result
by
the
number
in
the
row
under
the
headings
"Actual"
and
"Expenses
Paid
During
Period"
(
if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50
).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
"Hypothetical"
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund's
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund's
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
"Hypothetical"
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above-in
the
far
right
column-multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
182/366
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Beginning
Account
Value
9/1/23
Ending
Account
Value
2/29/24
Expenses
Paid
During
Period
9/1/23-2/29/24
1,2
Ending
Account
Value
2/29/24
Expenses
Paid
During
Period
9/1/23-2/29/24
1,2
a
Net
Annualized
Expense
Ratio
2
$1,000
$1,053.60
$0.00
$1,024.86
$0.00
0.00%
Your
Fund's
Expenses
Franklin
Templeton
SMACS:
Series
H
3
franklintempleton.com
Semiannual
Report
Shareholders
of
mutual
funds
incur
ongoing
costs,
such
as
management
fees
(if
any),
custodian
fees
and
other
Fund
expenses,
which
are
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
the
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Please
note
that
the
expenses
shown
in
the
table
are
meant
to
highlight
your
ongoing
Fund
costs
only
and
do
not
reflect
any
program
fees
that
you
may
pay.
Therefore,
the
table
is
useful
in
comparing
ongoing
costs
of
investing
in
the
Fund
only,
and
will
not
help
you
determine
the
relative
total
costs
of
participating
in
any
one
investment
program.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
"Actual."
In
these
columns
the
Fund's
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
"Ending
Account
Value."
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(
of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration
):
Divide
your
account
value
by
$1,000
(if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6
).
Then
multiply
the
result
by
the
number
in
the
row
under
the
headings
"Actual"
and
"Expenses
Paid
During
Period"
(
if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50
).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
"Hypothetical"
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund's
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund's
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
"Hypothetical"
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above-in
the
far
right
column-multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
182/366
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Beginning
Account
Value
9/1/23
Ending
Account
Value
2/29/24
Expenses
Paid
During
Period
9/1/23-2/29/24
1,2
Ending
Account
Value
2/29/24
Expenses
Paid
During
Period
9/1/23-2/29/24
1,2
a
Net
Annualized
Expense
Ratio
2
$1,000
$1,065.00
$0.00
$1,024.86
$0.00
0.00%
Your
Fund's
Expenses
Franklin
Templeton
SMACS:
Series
I
4
franklintempleton.com
Semiannual
Report
Shareholders
of
mutual
funds
incur
ongoing
costs,
such
as
management
fees
(if
any),
custodian
fees
and
other
Fund
expenses,
which
are
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
the
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Please
note
that
the
expenses
shown
in
the
table
are
meant
to
highlight
your
ongoing
Fund
costs
only
and
do
not
reflect
any
program
fees
that
you
may
pay.
Therefore,
the
table
is
useful
in
comparing
ongoing
costs
of
investing
in
the
Fund
only,
and
will
not
help
you
determine
the
relative
total
costs
of
participating
in
any
one
investment
program.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
"Actual."
In
these
columns
the
Fund's
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
"Ending
Account
Value."
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(
of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration
):
Divide
your
account
value
by
$1,000
(
if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6
).
Then
multiply
the
result
by
the
number
in
the
row
under
the
headings
"Actual"
and
"Expenses
Paid
During
Period"
(
if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50
).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
"Hypothetical"
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund's
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund's
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
"Hypothetical"
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above-in
the
far
right
column-multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
182/366
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Beginning
Account
Value
9/1/23
Ending
Account
Value
2/29/24
Expenses
Paid
During
Period
9/1/23-2/29/24
1,2
Ending
Account
Value
2/29/24
Expenses
Paid
During
Period
9/1/23-2/29/24
1,2
a
Net
Annualized
Expense
Ratio
2
$1,000
$1,048.70
$0.00
$1,024.86
$0.00
0.00%
Franklin
Strategic
Series
Financial
Highlights
Franklin
Templeton
SMACS:
Series
CH
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
5
a
Six
Months
Ended
February
29,
2024
(unaudited)
Year
Ended
August
31,
Year
Ended
August
31,
2019
a
2023
2022
2021
2020
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$8.52
$8.85
$10.51
$9.82
$10.26
$10.00
Income
from
investment
operations
b
:
Net
investment
income
c
.............
0.21
0.39
0.36
0.35
0.33
0.05
Net
realized
and
unrealized
gains
(losses)
0.09
(0.32)
(1.66)
0.69
(0.31)
0.26
Total
from
investment
operations
........
0.30
0.07
(1.30)
1.04
0.02
0.31
Less
distributions
from:
Net
investment
income
..............
(0.21)
(0.40)
(0.36)
(0.35)
(0.33)
(0.05)
Net
realized
gains
.................
-
-
-
-
(0.13)
-
Total
distributions
...................
(0.21)
(0.40)
(0.36)
(0.35)
(0.46)
(0.05)
Net
asset
value,
end
of
period
..........
$8.61
$8.52
$8.85
$10.51
$9.82
$10.26
Total
return
d
.......................
3.59%
0.85%
(12.61)%
10.75%
0.25%
3.06%
Ratios
to
average
net
assets
e
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.54%
2.48%
2.37%
3.11%
4.23%
3.74%
Expenses
net
of
waiver
and
payments
by
affiliates
..........................
-%
-%
f
-%
f
-%
f
-%
f
-%
Net
investment
income
...............
5.07%
4.56%
3.71%
3.44%
3.38%
1.87%
Supplemental
data
Net
assets,
end
of
period
(000's)
........
$23,145
$3,898
$2,957
$3,512
$2,986
$4,028
Portfolio
turnover
rate
................
33.52%
45.25%
5.65%
2.74%
51.23%
18.11%
a
For
the
period
June
3,
2019
(commencement
of
operations)
to
August
31,
2019.
b
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund's
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
c
Based
on
average
daily
shares
outstanding.
d
Total
return
is
not
annualized
for
periods
less
than
one
year.
e
Ratios
are
annualized
for
periods
less
than
one
year,
except
for
non-recurring
expenses,
if
any.
f
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited),
February
29,
2024
Franklin
Templeton
SMACS:
Series
CH
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
6
a
a
Principal
Amount
a
Value
a
a
a
a
a
Municipal
Bonds
98.3%
California
97.7%
Alameda
Community
Facilities
District
,
City
of
Alameda
Community
Facilities
District
No.
22-1
,
Special
Tax
,
2023
,
5
%
,
9/01/53
................................
$
125,000
$
121,523
Beaumont
Unified
School
District
,
Community
Facilities
District
No.
2020-1
Improvement
Area
No.
2
,
Special
Tax
,
2023
,
5
%
,
9/01/53
....................
150,000
152,227
a
California
Community
Choice
Financing
Authority
,
Revenue
,
2023
C
,
Mandatory
Put
,
5.25
%
,
10/01/31
...................................................
1,000,000
1,058,471
b
California
Community
Housing
Agency
,
Annadel
Apartments,
Revenue,
144A,
2019
A,
5%,
4/01/49
..................
1,200,000
998,030
Mira
Vista
Hills
Apartments,
Revenue,
144A,
2021
A,
4%,
2/01/56
.............
300,000
212,212
Serenity
at
Larkspur
Apartments,
Revenue,
144A,
2020
A,
5%,
2/01/50
.........
1,000,000
763,251
California
Educational
Facilities
Authority
,
St.
Mary's
College
of
California
,
Revenue
,
2023
A
,
Refunding
,
5.5
%
,
10/01/53
....................................
1,000,000
1,058,300
California
Health
Facilities
Financing
Authority
,
Episcopal
Communities
&
Services
for
Seniors
Obligated
Group
,
Revenue
,
2024
B
,
5.25
%
,
11/15/53
.................
500,000
529,370
California
Municipal
Finance
Authority
,
Special
Tax,
2022
B,
Refunding,
6%,
9/01/52
.............................
150,000
159,846
Special
Tax,
2022
C,
6.25%,
9/01/52
...................................
150,000
160,806
Special
Tax,
2022
D,
6.125%,
9/01/52
..................................
150,000
158,792
Special
Tax,
2023
A,
5.5%,
9/01/53
....................................
100,000
103,321
Special
Tax,
2023
C,
5.25%,
9/01/53
...................................
1,000,000
981,590
Caritas
Corp.
(The),
Revenue,
2021
B,
Refunding,
4%,
8/15/56
...............
115,000
97,363
b
Claremont
Graduate
University,
Revenue,
144A,
2020
B,
Refunding,
5%,
10/01/49
.
125,000
119,608
Community
Facilities
District
No.
2021-6
Improvement
Area
No.
2,
Special
Tax,
2022,
6%,
9/01/52
....................................................
150,000
156,270
Community
Facilities
District
No.
2023-5
Area
No.
1,
Special
Tax,
2023,
5.8%,
9/01/53
........................................................
1,000,000
1,044,109
Congregational
Homes,
Inc.
Obligated
Group,
Revenue,
2019,
Refunding,
5%,
11/15/39
.......................................................
130,000
130,694
b
IH
Parkside
Fairfield
LLC,
Revenue,
144A,
2023
B,
Zero
Cpn.,
9/01/43
..........
250,000
168,624
b
California
Pollution
Control
Financing
Authority
,
Poseidon
Resources
Channelside
LP,
Revenue,
144A,
2019,
Refunding,
5%,
7/01/39
1,000,000
1,034,554
c
Rialto
Bioenergy
Facility
LLC,
Revenue,
144A,
2018,
7.5%,
12/01/40
...........
75,000
5,625
b
California
Public
Finance
Authority
,
Kendal
at
Sonoma
Obligated
Group
,
Revenue
,
144A,
2021
A
,
Refunding
,
5
%
,
11/15/46
.................................
1,250,000
1,091,813
b
California
School
Finance
Authority
,
Orange
County
Educational
Arts
Academy
,
Revenue
,
144A,
2023
A
,
Refunding
,
5.875
%
,
6/01/53
.......................
100,000
101,186
California
Statewide
Communities
Development
Authority
,
Special
Tax,
2023
A,
5.25%,
9/01/51
...................................
100,000
101,497
Community
Facilities
District
No.
2016-02,
Special
Tax,
2019,
5%,
9/01/39
.......
100,000
105,376
Community
Facilities
District
No.
2021-1,
Special
Tax,
2023,
5%,
9/01/53
........
150,000
156,152
Community
Facilities
District
No.
2022-03,
Special
Tax,
2023,
5%,
9/01/53
.......
150,000
148,286
Community
Facilities
District
No.
2022-07
Improvement
Area
No.
1,
Special
Tax,
2023,
5%,
9/01/53
................................................
150,000
152,550
Community
Infrastructure
Program
Assessment
District
No.
20-02,
Special
Assessment,
2023,
5.75%,
9/02/53
...................................
1,000,000
964,933
b
Loma
Linda
University
Medical
Center
Obligated
Group,
Revenue,
144A,
2016
A,
5.25%,
12/01/56
.................................................
250,000
251,159
b
NCCD-Hooper
Street
LLC,
Revenue,
144A,
2019,
5.25%,
7/01/49
.............
100,000
100,545
b
NCCD-Hooper
Street
LLC,
Revenue,
144A,
2019,
5.25%,
7/01/52
.............
200,000
200,814
Chino
Community
Facilities
District
,
Community
Facilities
District
No.
2021-1
,
Special
Tax
,
2023
,
5.625
%
,
9/01/53
..........................................
1,000,000
1,049,461
b
City
&
County
of
San
Francisco
,
Community
Facilities
District
No.
2016-1
Improvement
Area
2,
Special
Tax,
144A,
2023
A,
5.25%,
9/01/48
............................................
965,000
948,721
District
No.
2020-1
Shoreline
Tax
Zone
1,
Special
Tax,
144A,
2023
C,
5.75%,
9/01/53
1,500,000
1,548,127
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
CH
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
7
a
a
Principal
Amount
a
Value
a
a
a
a
a
Municipal
Bonds
(continued)
California
(continued)
City
of
Dublin
,
Community
Facilities
District
No.
2015-1
Improvement
Area
No.
5
,
Special
Tax
,
2023
,
5.375
%
,
9/01/51
....................................
$
1,250,000
$
1,288,253
City
of
Lake
Elsinore
,
Community
Facilities
District
No.
2006-8
,
Special
Tax
,
2023
,
5
%
,
9/01/53
.........................................................
150,000
153,172
City
of
Rancho
Cordova
,
Arista
Del
Sol
Community
Facilities
District
No.
2022-1
Improvement
Area
No.
1
,
Special
Tax
,
2023
,
5.375
%
,
9/01/53
.................
200,000
206,883
b
CSCDA
Community
Improvement
Authority
,
CTR
City
Anaheim,
Revenue,
144A,
2020
A,
5%,
1/01/54
....................
400,000
322,955
Dublin,
Revenue,
144A,
2021
B,
4%,
2/01/57
.............................
140,000
103,491
Galt
Community
Facilities
District
,
City
of
Galt
Community
Facilities
District
No.
2020-2
Improvement
Area
No.
1
,
Special
Tax
,
2023
A
,
6
%
,
9/01/53
..................
1,500,000
1,537,589
Golden
State
Tobacco
Securitization
Corp.
,
Revenue
,
2022
A-1
,
Refunding
,
5
%
,
6/01/51
.........................................................
600,000
629,780
Orange
County
Community
Facilities
District
,
Community
Facilities
District
No.
2023-1
,
Special
Tax
,
2023
A
,
5.5
%
,
8/15/53
....................................
1,000,000
1,041,448
River
Islands
Public
Financing
Authority
,
Community
Facilities
District
2023-1
Area
No.
1
,
Special
Tax
,
2023
,
5.625
%
,
9/01/53
..................................
1,000,000
1,024,359
Washington
Township
Health
Care
District
,
Revenue
,
2023
A
,
5.75
%
,
7/01/48
......
150,000
166,497
22,609,633
U.S.
Territories
0.6%
Puerto
Rico
0.6%
GDB
Debt
Recovery
Authority
of
Puerto
Rico
,
7.5
%
,
8/20/40
...................
158,506
151,373
Total
Municipal
Bonds
(Cost
$22,058,360)
......................................
22,761,006
a
a
a
a
Short
Term
Investments
0.9%
Municipal
Bonds
0.9%
Minnesota
0.9%
d
City
of
Minneapolis
,
Fairview
Health
Services
Obligated
Group
,
Revenue
,
2018
C
,
Refunding
,
LOC
Wells
Fargo
Bank
NA
,
Daily
VRDN
and
Put
,
3.6
%
,
11/15/48
.....
200,000
200,000
Total
Municipal
Bonds
(Cost
$200,000)
.........................................
200,000
Total
Short
Term
Investments
(Cost
$200,000
)
..................................
200,000
a
Total
Investments
(Cost
$22,258,360)
99.2%
....................................
$22,961,006
Other
Assets,
less
Liabilities
0.8%
.............................................
184,298
Net
Assets
100.0%
...........................................................
$23,145,304
See
A
bbreviations
on
page
43
.
a
The
maturity
date
shown
represents
the
mandatory
put
date.
b
Security
was
purchased
pursuant
to
Rule
144A
or
Regulation
S
under
the
Securities
Act
of
1933.
144A
securities
may
be
sold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers
or
in
a
public
offering
registered
under
the
Securities
Act
of
1933.
Regulation
S
securities
cannot
be
sold
in
the
United
States
without
either
an
effective
registration
statement
filed
pursuant
to
the
Securities
Act
of
1933,
or
pursuant
to
an
exemption
from
registration.
At
February
29,
2024,
the
aggregate
value
of
these
securities
was
$7,970,715,
representing
34.4%
of
net
assets.
c
Defaulted
security
or
security
for
which
income
has
been
deemed
uncollectible.
See
Note
7.
d
Variable
rate
demand
notes
(VRDNs)
are
obligations
which
contain
a
floating
or
variable
interest
rate
adjustment
formula
and
an
unconditional
right
of
demand
to
receive
payment
of
the
principal
balance
plus
accrued
interest
at
specified
dates.
Unless
otherwise
noted,
the
coupon
rate
is
determined
based
on
factors
including
supply
and
demand,
underlying
credit,
tax
treatment,
and
current
short
term
rates.
The
coupon
rate
shown
represents
the
rate
at
period
end.
Franklin
Strategic
Series
Financial
Highlights
Franklin
Templeton
SMACS:
Series
E
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
8
a
Six
Months
Ended
February
29,
2024
(unaudited)
Year
Ended
August
31,
Year
Ended
August
31,
2019
a
2023
2022
2021
2020
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$11.56
$11.29
$12.77
$10.15
$10.69
$10.00
Income
from
investment
operations
b
:
Net
investment
income
c
.............
0.19
0.42
0.37
0.35
0.36
0.10
Net
realized
and
unrealized
gains
(losses)
0.41
0.75
(0.31)
2.72
(0.19)
0.63
Total
from
investment
operations
........
0.60
1.17
0.06
3.07
0.17
0.73
Less
distributions
from:
Net
investment
income
..............
(0.36)
(0.72)
(0.83)
(0.45)
(0.49)
(0.04)
Net
realized
gains
.................
-
(0.18)
(0.71)
-
(0.22)
-
Tax
return
of
capital
................
-
(-)
d
-
-
-
-
Total
distributions
...................
(0.36)
(0.90)
(1.54)
(0.45)
(0.71)
(0.04)
Net
asset
value,
end
of
period
..........
$11.80
$11.56
$11.29
$12.77
$10.15
$10.69
Total
return
e
.......................
5.36%
10.81%
0.38%
30.95%
1.77%
7.31%
Ratios
to
average
net
assets
f
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.12%
0.27%
1.36%
2.19%
2.85%
4.76%
Expenses
net
of
waiver
and
payments
by
affiliates
..........................
-%
-%
g
-%
-%
g
-%
g
-%
Net
investment
income
...............
3.28%
3.70%
3.11%
3.05%
3.48%
4.11%
Supplemental
data
Net
assets,
end
of
period
(000's)
........
$136,925
$61,992
$12,863
$5,155
$3,847
$3,959
Portfolio
turnover
rate
................
50.23%
123.80%
117.70%
49.90%
58.50%
16.33%
a
For
the
period
June
3,
2019
(commencement
of
operations)
to
August
31,
2019.
b
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund's
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
c
Based
on
average
daily
shares
outstanding.
d
Amount
rounds
to
less
than
$0.01
per
share.
e
Total
return
is
not
annualized
for
periods
less
than
one
year.
f
Ratios
are
annualized
for
periods
less
than
one
year,
except
for
non-recurring
expenses,
if
any.
g
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited),
February
29,
2024
Franklin
Templeton
SMACS:
Series
E
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
9
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
53.8%
Aerospace
&
Defense
1.5%
Lockheed
Martin
Corp.
.................................
United
States
2,500
$
1,070,600
Northrop
Grumman
Corp.
...............................
United
States
2,000
922,040
1,992,640
Automobiles
0.4%
a
Ford
Motor
Co.
.......................................
United
States
46,254
575,400
Banks
5.3%
Citigroup,
Inc.
........................................
United
States
41,500
2,302,835
Fifth
Third
Bancorp
....................................
United
States
27,000
927,180
Truist
Financial
Corp.
..................................
United
States
45,000
1,574,100
US
Bancorp
.........................................
United
States
60,000
2,517,600
7,321,715
Beverages
2.8%
Coca-Cola
Co.
(The)
...................................
United
States
65,000
3,901,300
Building
Products
0.9%
Johnson
Controls
International
plc
.........................
United
States
20,000
1,185,400
Capital
Markets
1.1%
Charles
Schwab
Corp.
(The)
.............................
United
States
22,000
1,469,160
Chemicals
2.2%
Air
Products
and
Chemicals,
Inc.
..........................
United
States
10,000
2,340,400
LyondellBasell
Industries
NV,
A
...........................
United
States
7,000
701,960
3,042,360
Communications
Equipment
1.1%
Cisco
Systems,
Inc.
...................................
United
States
30,000
1,451,100
Electric
Utilities
1.2%
American
Electric
Power
Co.,
Inc.
.........................
United
States
17,000
1,448,230
NextEra
Energy,
Inc.
...................................
United
States
3,000
165,570
1,613,800
Food
Products
2.7%
Nestle
SA,
ADR
......................................
United
States
35,000
3,638,950
Hotels,
Restaurants
&
Leisure
0.9%
Starbucks
Corp.
......................................
United
States
13,000
1,233,700
Household
Products
1.7%
Procter
&
Gamble
Co.
(The)
.............................
United
States
15,000
2,384,100
Industrial
Conglomerates
0.7%
Honeywell
International,
Inc.
.............................
United
States
5,100
1,013,523
Machinery
0.4%
Cummins,
Inc.
........................................
United
States
2,300
617,803
Metals
&
Mining
3.2%
Freeport-McMoRan,
Inc.
................................
United
States
30,000
1,134,300
Rio
Tinto
plc,
ADR
.....................................
Australia
50,000
3,226,500
4,360,800
Multi-Utilities
0.6%
DTE
Energy
Co.
......................................
United
States
7,500
812,625
Oil,
Gas
&
Consumable
Fuels
6.0%
Chevron
Corp.
.......................................
United
States
12,401
1,885,076
Shell
plc,
ADR
........................................
Netherlands
65,000
4,083,950
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
E
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
10
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Common
Stocks
(continued)
Oil,
Gas
&
Consumable
Fuels
(continued)
TotalEnergies
SE,
ADR
.................................
France
35,000
$
2,242,450
8,211,476
Pharmaceuticals
9.5%
AstraZeneca
plc,
ADR
..................................
United
Kingdom
60,000
3,849,600
Merck
&
Co.,
Inc.
.....................................
United
States
45,000
5,721,750
Roche
Holding
AG
....................................
United
States
13,000
3,399,188
12,970,538
Semiconductors
&
Semiconductor
Equipment
4.9%
Analog
Devices,
Inc.
...................................
United
States
20,000
3,836,400
Texas
Instruments,
Inc.
.................................
United
States
17,000
2,844,610
6,681,010
Software
3.0%
Oracle
Corp.
.........................................
United
States
37,000
4,132,160
Specialty
Retail
1.4%
Home
Depot,
Inc.
(The)
.................................
United
States
5,000
1,903,050
Tobacco
2.3%
Philip
Morris
International,
Inc.
...........................
United
States
35,000
3,148,600
Total
Common
Stocks
(Cost
$69,744,061)
......................................
73,661,210
b
Equity-Linked
Securities
37.8%
Aerospace
&
Defense
2.3%
c
Barclays
Bank
plc
into
Northrop
Grumman
Corp.,
144A,
7%,
11/08/24
..........................................
United
States
1,800
855,403
c
BNP
Paribas
Issuance
BV
into
Northrop
Grumman
Corp.,
144A,
7.5%,
9/10/24
......................................
United
States
2,000
891,282
c
Merrill
Lynch
International
&
Co.
CV
into
Raytheon
Technologies
Corp.,
144A,
7.5%,
5/08/24
............................
United
States
4,000
366,022
c
Merrill
Lynch
International
&
Co.
CV
into
RTX
Corp.,
144A,
7.5%,
10/02/24
..........................................
United
States
12,000
1,009,055
3,121,762
Air
Freight
&
Logistics
1.3%
c
J.P.
Morgan
Structured
Products
BV
into
United
Parcel
Service,
Inc.,
144A,
9%,
10/22/24
..................................
United
States
5,500
844,474
c
Merrill
Lynch
International
&
Co.
CV
into
United
Parcel
Service,
Inc.,
144A,
8.5%,
10/02/24
.................................
United
States
5,700
872,856
1,717,330
Automobiles
0.3%
c
Barclays
Bank
plc
into
General
Motors
Co.,
144A,
10%,
7/17/24
..
United
States
11,000
438,288
Banks
2.6%
c
Barclays
Bank
plc
into
Citigroup,
Inc.,
144A,
9%,
7/03/24
........
United
States
5,000
269,790
c
Barclays
Bank
plc
into
US
Bancorp,
144A,
10%,
8/23/24
........
United
States
16,500
679,917
c
BNP
Paribas
Issuance
BV
into
Bank
of
America
Corp.,
144A,
8.5%,
2/26/25
...........................................
United
States
35,000
1,188,763
c
Citigroup
Global
Markets
Holdings,
Inc.
into
Bank
of
America
Corp.,
144A,
8%,
8/16/24
...................................
United
States
8,400
284,107
c
Merrill
Lynch
International
&
Co.
CV
into
Fifth
Third
Bancorp,
144A,
10%,
3/10/25
.......................................
United
States
12,000
407,728
c
Wells
Fargo
Bank
NA
into
Citigroup,
Inc.,
144A,
10%,
2/25/25
....
United
States
13,000
728,264
3,558,569
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
E
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
11
a
a
Country
Shares
a
Value
a
a
a
a
a
a
b
Equity-Linked
Securities
(continued)
Biotechnology
0.4%
c
Barclays
Bank
plc
into
Amgen,
Inc.,
144A,
8%,
9/20/24
.........
United
States
2,100
$
570,563
Broadline
Retail
1.2%
c
Goldman
Sachs
International
Bank
into
Amazon.com,
Inc.,
144A,
9%,
11/20/24
.......................................
United
States
10,000
1,309,947
c
Royal
Bank
of
Canada
into
Amazon.com,
Inc.,
144A,
10%,
4/05/24
United
States
2,800
326,535
1,636,482
Building
Products
2.1%
c
J.P.
Morgan
Structured
Products
BV
into
Johnson
Controls
International
plc,
144A,
8%,
9/09/24
......................
United
States
15,000
901,937
c
Wells
Fargo
Bank
NA
into
Johnson
Controls
International
plc,
144A,
9%,
12/10/24
.......................................
United
States
35,000
1,969,951
2,871,888
Capital
Markets
3.0%
c
BNP
Paribas
Issuance
BV
into
Goldman
Sachs
Group,
Inc.
(The),
144A,
7.5%,
8/19/24
.................................
United
States
1,700
647,785
c
Goldman
Sachs
International
Bank
into
Morgan
Stanley,
144A,
9%,
12/24/24
..........................................
United
States
2,300
203,959
c
Merrill
Lynch
International
&
Co.
CV
into
Charles
Schwab
Corp.
(The),
144A,
9%,
2/25/25
..............................
United
States
32,000
2,093,472
c
Merrill
Lynch
International
&
Co.
CV
into
Morgan
Stanley,
144A,
10%,
6/04/24
.......................................
United
States
1,000
88,158
c
Societe
Generale
SA
into
Goldman
Sachs
Group,
Inc.
(The),
144A,
8.5%,
7/12/24
......................................
United
States
1,500
528,777
c
UBS
AG
into
Charles
Schwab
Corp.
(The),
144A,
10%,
7/17/24
...
United
States
8,100
502,819
4,064,970
Chemicals
1.2%
c
Barclays
Bank
plc
into
Air
Products
and
Chemicals,
Inc.,
144A,
8.5%,
3/10/25
...........................................
United
States
7,000
1,613,314
Communications
Equipment
1.4%
c
Mizuho
Markets
Cayman
LP
into
Cisco
Systems,
Inc.,
144A,
7.5%,
7/23/24
...........................................
United
States
12,000
597,629
c
Royal
Bank
of
Canada
into
Cisco
Systems,
Inc.,
144A,
8%,
9/03/24
United
States
15,000
760,800
c
UBS
AG
into
Cisco
Systems,
Inc.,
144A,
8.5%,
6/20/24
.........
United
States
11,000
546,572
1,905,001
Consumer
Staples
Distribution
&
Retail
1.2%
c
Barclays
Bank
plc
into
Target
Corp.,
144A,
8.5%,
10/08/24
......
United
States
5,800
815,931
c
UBS
AG
into
Target
Corp.,
144A,
9%,
9/05/24
................
United
States
5,900
882,786
1,698,717
Containers
&
Packaging
0.8%
c
Mizuho
Markets
Cayman
LP
into
International
Paper
Co.,
144A,
10%,
1/22/25
.......................................
United
States
30,000
1,103,579
Electric
Utilities
0.5%
c
Mizuho
Markets
Cayman
LP
into
NextEra
Energy,
Inc.,
144A,
8%,
3/19/24
...........................................
United
States
4,600
260,769
c
Wells
Fargo
Bank
NA
into
NextEra
Energy,
Inc.,
144A,
8%,
5/08/24
United
States
7,500
425,426
686,195
Ground
Transportation
0.9%
c
Merrill
Lynch
BV
into
Union
Pacific
Corp.,
144A,
8%,
11/05/24
....
United
States
1,800
419,046
c
UBS
AG
into
Union
Pacific
Corp.,
144A,
8%,
3/13/24
...........
United
States
3,600
831,340
1,250,386
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
E
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
12
a
a
Country
Shares
a
Value
a
a
a
a
a
a
b
Equity-Linked
Securities
(continued)
Hotels,
Restaurants
&
Leisure
0.2%
c
Wells
Fargo
Bank
NA
into
Starbucks
Corp.,
144A,
8%,
3/04/25
...
United
States
3,000
$
285,639
Insurance
1.7%
c
BNP
Paribas
Issuance
BV
into
MetLife,
Inc.,
144A,
9%,
10/23/24
..
United
States
6,800
461,323
c
Citigroup
Global
Markets
Holdings,
Inc.
into
MetLife,
Inc.,
144A,
9.5%,
7/17/24
......................................
United
States
4,500
277,857
c
JPMorgan
Chase
Bank
NA
into
MetLife,
Inc.,
144A,
8%,
3/25/25
..
United
States
23,000
1,588,408
2,327,588
Media
2.0%
c
BNP
Paribas
Issuance
BV
into
Comcast
Corp.,
144A,
8%,
1/15/25
United
States
32,000
1,393,429
c
J.P.
Morgan
Structured
Products
BV
into
Comcast
Corp.,
144A,
8%,
8/13/24
...........................................
United
States
10,000
429,322
c
J.P.
Morgan
Structured
Products
BV
into
Comcast
Corp.,
144A,
8%,
9/12/24
...........................................
United
States
3,000
133,440
c
Royal
Bank
of
Canada
into
Comcast
Corp.,
144A,
8%,
7/12/24
...
United
States
18,000
776,875
2,733,066
Metals
&
Mining
1.9%
c
Mizuho
Markets
Cayman
LP
into
Freeport-McMoRan,
Inc.,
144A,
11%,
12/10/24
......................................
United
States
9,600
373,459
c
Royal
Bank
of
Canada
into
Barrick
Gold
Corp.,
144A,
11%,
3/07/24
Canada
35,000
521,489
c
UBS
AG
into
Newmont
Corp.,
144A,
11%,
1/16/25
.............
United
States
50,000
1,682,181
2,577,129
Multi-Utilities
0.9%
c
Wells
Fargo
Bank
NA
into
Dominion
Energy,
Inc.,
144A,
9%,
1/10/25
United
States
26,000
1,274,605
Oil,
Gas
&
Consumable
Fuels
2.2%
c
BNP
Paribas
Issuance
BV
into
BP
plc,
144A,
8.5%,
4/24/24
......
United
Kingdom
23,000
823,430
c
Citigroup
Global
Markets
Holdings,
Inc.
into
Exxon
Mobil
Corp.,
144A,
9%,
3/12/25
...................................
United
States
19,000
1,968,324
c
J.P.
Morgan
Structured
Products
BV
into
Exxon
Mobil
Corp.,
144A,
9%,
9/24/24
........................................
United
States
2,300
249,505
3,041,259
Pharmaceuticals
1.5%
c
BNP
Paribas
Issuance
BV
into
Pfizer,
Inc.,
144A,
8.5%,
6/10/24
..
United
States
19,000
528,102
c
National
Bank
of
Canada
into
Bristol-Myers
Squibb
Co.,
144A,
8%,
9/05/24
...........................................
United
States
20,000
1,062,180
c
Societe
Generale
SA
into
Pfizer,
Inc.,
144A,
8.5%,
8/02/24
......
United
States
15,000
408,292
1,998,574
Semiconductors
&
Semiconductor
Equipment
5.1%
c
Citigroup
Global
Markets
Holdings,
Inc.
into
Intel
Corp.,
144A,
10%,
10/03/24
..........................................
United
States
1,600
66,271
c
Goldman
Sachs
International
Bank
into
Texas
Instruments,
Inc.,
144A,
9%,
11/10/25
..................................
United
States
8,000
1,311,701
c
Mizuho
Markets
Cayman
LP
into
Intel
Corp.,
144A,
12%,
3/26/24
.
United
States
25,000
1,088,689
c
Mizuho
Markets
Cayman
LP
into
Microchip
Technology,
Inc.,
144A,
10%,
11/12/24
......................................
United
States
9,000
743,620
c
Mizuho
Markets
Cayman
LP
into
Taiwan
Semiconductor
Manufacturing
Co.
Ltd.,
144A,
10%,
10/22/24
...............
Taiwan
9,000
889,419
c
Morgan
Stanley
Finance
II
Ltd.
into
Microchip
Technology,
Inc.,
144A,
10%,
3/03/25
..................................
United
States
11,500
981,785
c
UBS
AG
into
Texas
Instruments,
Inc.,
144A,
8.5%,
8/07/24
......
United
States
700
118,786
c
Wells
Fargo
Bank
NA
into
Intel
Corp.,
144A,
11%,
2/14/25
.......
United
States
39,000
1,765,660
6,965,931
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
E
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
13
a
a
Country
Shares
a
Value
a
a
a
a
a
a
b
Equity-Linked
Securities
(continued)
Software
2.9%
c
Barclays
Bank
plc
into
Oracle
Corp.,
144A,
8.5%,
2/05/25
.......
United
States
13,000
$
1,413,143
c
Mizuho
Markets
Cayman
LP
into
Oracle
Corp.,
144A,
8.5%,
2/10/25
United
States
7,000
786,680
c
Societe
Generale
SA
into
Workday,
Inc.,
144A,
9%,
11/13/24
.....
United
States
7,400
1,807,193
4,007,016
Specialty
Retail
0.2%
c
Citigroup
Global
Markets
Holdings,
Inc.
into
Home
Depot,
Inc.
(The),
144A,
8.5%,
6/12/24
.................................
United
States
900
329,455
Total
Equity-Linked
Securities
(Cost
$51,025,219)
...............................
51,777,306
Convertible
Preferred
Stocks
1.3%
Electric
Utilities
1.3%
NextEra
Energy,
Inc.,
6.926%
............................
United
States
50,000
1,752,000
Total
Convertible
Preferred
Stocks
(Cost
$2,100,887)
............................
1,752,000
Principal
Amount
*
Corporate
Bonds
4.8%
Diversified
REITs
1.0%
c
VICI
Properties
LP
/
VICI
Note
Co.,
Inc.
,
Senior
Bond
,
144A,
4.625
%
,
12/01/29
..........................................
United
States
1,500,000
1,397,760
Entertainment
0.6%
Warnermedia
Holdings,
Inc.
,
Senior
Note
,
4.279
%
,
3/15/32
......
United
States
1,000,000
882,623
Hotels,
Restaurants
&
Leisure
0.7%
Expedia
Group,
Inc.
,
Senior
Note
,
3.25
%
,
2/15/30
.............
United
States
1,000,000
891,510
Metals
&
Mining
0.7%
c
Alcoa
Nederland
Holding
BV
,
Senior
Note
,
144A,
4.125
%
,
3/31/29
.
United
States
1,000,000
916,897
Tobacco
1.1%
Philip
Morris
International,
Inc.
,
Senior
Bond
,
5.625
%
,
9/07/33
....
United
States
1,500,000
1,516,865
Trading
Companies
&
Distributors
0.7%
c
United
Rentals
North
America,
Inc.
,
Senior
Secured
Note
,
144A,
6
%
,
12/15/29
..........................................
United
States
1,000,000
1,001,792
Total
Corporate
Bonds
(Cost
$6,560,282)
.......................................
6,607,447
Total
Long
Term
Investments
(Cost
$129,430,449)
...............................
133,797,963
a
Short
Term
Investments
1.7%
a
a
Country
Shares
a
Value
a
a
a
Money
Market
Funds
1.7%
d,e
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.984%
....
United
States
2,375,288
2,375,288
Total
Money
Market
Funds
(Cost
$2,375,288)
...................................
2,375,288
Total
Short
Term
Investments
(Cost
$2,375,288
)
.................................
2,375,288
a
Total
Investments
(Cost
$131,805,737)
99.4%
...................................
$136,173,251
Other
Assets,
less
Liabilities
0.6%
.............................................
751,968
Net
Assets
100.0%
...........................................................
$136,925,219
a
a
a
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
E
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
14
See
A
bbreviations
on
page
43
.
*
The
principal
amount
is
stated
in
U.S.
dollars
unless
otherwise
indicated.
a
Non-income
producing.
b
See
Note
1(d)
regarding
equity-linked
securities.
c
Security
was
purchased
pursuant
to
Rule
144A
or
Regulation
S
under
the
Securities
Act
of
1933.
144A
securities
may
be
sold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers
or
in
a
public
offering
registered
under
the
Securities
Act
of
1933.
Regulation
S
securities
cannot
be
sold
in
the
United
States
without
either
an
effective
registration
statement
filed
pursuant
to
the
Securities
Act
of
1933,
or
pursuant
to
an
exemption
from
registration.
At
February
29,
2024,
the
aggregate
value
of
these
securities
was
$55,093,755,
representing
40.2%
of
net
assets.
d
See
Note
3(d)
regarding
investments
in
affiliated
management
investment
companies.
e
The
rate
shown
is
the
annualized
seven-day
effective
yield
at
period
end.
Franklin
Strategic
Series
Financial
Highlights
Franklin
Templeton
SMACS:
Series
H
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
15
a
Six
Months
Ended
February
29,
2024
(unaudited)
Year
Ended
August
31,
Year
Ended
August
31,
2019
a
2023
2022
2021
2020
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$8.86
$9.03
$10.57
$9.75
$10.09
$10.00
Income
from
investment
operations
b
:
Net
investment
income
c
.............
0.23
0.38
0.31
0.32
0.30
0.04
Net
realized
and
unrealized
gains
(losses)
0.33
(0.18)
(1.54)
0.82
(0.34)
0.09
Total
from
investment
operations
........
0.56
0.20
(1.23)
1.14
(0.04)
0.13
Less
distributions
from:
Net
investment
income
..............
(0.22)
(0.37)
(0.31)
(0.32)
(0.30)
(0.04)
Net
asset
value,
end
of
period
..........
$9.20
$8.86
$9.03
$10.57
$9.75
$10.09
Total
return
d
.......................
6.50%
2.36%
e
(11.82)%
e
11.88%
e
(0.28)%
e
1.31%
Ratios
to
average
net
assets
f
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.86%
1.88%
2.51%
3.44%
3.91%
3.85%
Expenses
net
of
waiver
and
payments
by
affiliates
..........................
-%
-%
-%
g
-%
g
-%
g
-%
Net
investment
income
...............
5.20%
4.34%
3.14%
3.16%
3.10%
1.69%
Supplemental
data
Net
assets,
end
of
period
(000's)
........
$13,466
$10,059
$3,019
$3,187
$2,941
$3,042
Portfolio
turnover
rate
................
8.33%
11.82%
6.89%
5.37%
4.93%
-%
a
For
the
period
June
3,
2019
(commencement
of
operations)
to
August
31,
2019.
b
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund's
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
c
Based
on
average
daily
shares
outstanding.
d
Total
return
is
not
annualized
for
periods
less
than
one
year.
e
Total
return
excluding
payments
by
Advisers
for
acquired
fund
fees
and
expenses
is
2.25%
for
the
year
ended
August
31,
2023,
(11.90)%
for
the
year
ended
August
31,
2022,
11.78%
for
the
year
ended
August
31,
2021
and
(0.38)%
for
the
year
ended
August
31,
2020.
See
Note
3e.
f
Ratios
are
annualized
for
periods
less
than
one
year,
except
for
non-recurring
expenses,
if
any.
g
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited),
February
29,
2024
Franklin
Templeton
SMACS:
Series
H
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
16
a
a
Shares
a
Value
a
Management
Investment
Companies
9.0%
Capital
Markets
9.0%
a
Franklin
Dynamic
Municipal
Bond
ETF
...................................
50,000
$
1,217,500
Total
Management
Investment
Companies
(Cost
$
1,242,874
)
.....................
1,217,500
Principal
Amount
a
a
a
a
Municipal
Bonds
90.3%
Alabama
1.6%
MidCity
Improvement
District
,
Assessment
Area
,
Special
Assessment
,
2022
,
4.5
%
,
11/01/42
................
$
150,000
126,054
Assessment
Area
,
Special
Assessment
,
2022
,
4.75
%
,
11/01/49
...............
100,000
82,851
208,905
Arizona
1.1%
b
Sierra
Vista
Industrial
Development
Authority
,
American
Leadership
Academy,
Inc.
,
Revenue
,
144A,
2023
,
5.75
%
,
6/15/58
..................................
150,000
151,321
Arkansas
1.2%
Arkansas
Development
Finance
Authority
,
United
States
Steel
Corp.
,
Revenue
,
2023
,
5.7
%
,
5/01/53
....................................................
150,000
155,512
California
9.1%
c
California
Community
Choice
Financing
Authority
,
Revenue
,
2023
C
,
Mandatory
Put
,
5.25
%
,
10/01/31
...................................................
130,000
137,601
b
California
Community
Housing
Agency
,
Arbors
Apartments
,
Revenue
,
144A,
2020
A
,
5
%
,
8/01/50
....................
125,000
118,506
Aster
Apartments
,
Revenue,
Junior
Lien
,
144A,
2021
A-2
,
4
%
,
2/01/43
..........
130,000
117,466
Fountains
at
Emerald
Park
,
Revenue,
Junior
Lien
,
144A,
2021
A-2
,
4
%
,
8/01/46
...
195,000
168,889
Verdant
at
Green
Valley
Apartments
,
Revenue
,
144A,
2019
A
,
5
%
,
8/01/49
.......
105,000
100,060
b
California
Municipal
Finance
Authority
,
IH
Parkside
Fairfield
LLC
,
Revenue
,
144A,
2023
B
,
Zero
Cpn.,
9/01/43
...............................................
150,000
101,175
b
CMFA
Special
Finance
Agency
,
Solana
at
Grand
,
Revenue,
Junior
Lien
,
144A,
2021
A-2
,
4
%
,
8/01/45
..................................................
100,000
83,359
b
CMFA
Special
Finance
Agency
VIII
,
Elan
Huntington
Beach
,
Revenue,
Junior
Lien
,
144A,
2021
A-2
,
4
%
,
8/01/47
.........................................
125,000
106,633
b
CMFA
Special
Finance
Agency
XII
,
Allure
Apartments
,
Revenue
,
144A,
2022
A-2
,
4.375
%
,
8/01/49
...................................................
100,000
82,135
b
CSCDA
Community
Improvement
Authority
,
Renaissance
at
City
Center
,
Revenue
,
144A,
2020
A
,
5
%
,
7/01/51
.............
110,000
105,173
Waterscape
Apartments
,
Revenue
,
144A,
2021
B
,
4
%
,
9/01/46
................
135,000
111,016
1,232,013
Colorado
2.4%
Colorado
Health
Facilities
Authority
,
Christian
Living
Neighborhoods
Obligated
Group
,
Revenue
,
2019
,
Refunding
,
4
%
,
1/01/38
........................................................
100,000
89,729
CommonSpirit
Health
Obligated
Group
,
Revenue
,
2019
A-2
,
Refunding
,
4
%
,
8/01/49
250,000
233,321
323,050
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
H
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
17
a
a
Principal
Amount
a
Value
a
a
a
a
a
Municipal
Bonds
(continued)
Florida
20.3%
Chapel
Creek
Community
Development
District
,
Assessment
Area
,
Special
Assessment
,
2024
,
5.5
%
,
5/01/44
.....................................
$
70,000
$
70,542
City
of
Jacksonville
,
Genesis
Health,
Inc.
Obligated
Group
,
Revenue
,
2020
,
Refunding
,
5
%
,
11/01/50
.....................................................
100,000
103,214
Cross
Creek
North
Community
Development
District
,
Special
Assessment
,
2022
,
4.5
%
,
5/01/52
.........................................................
125,000
115,073
Crosswinds
East
Community
Development
District
,
Assessment
Area
1
,
Special
Assessment
,
2024
,
5.5
%
,
5/01/44
.....................................
100,000
100,852
b
Florida
Development
Finance
Corp.
,
Brightline
Trains
Florida
LLC
,
Revenue
,
144A,
2019
B
,
7.375
%
,
1/01/49
.........
100,000
102,498
Mayflower
Retirement
Center,
Inc.
Obligated
Group
,
Revenue
,
144A,
2021
A
,
Refunding
,
4
%
,
6/01/55
............................................
100,000
62,833
Kindred
Community
Development
District
II
,
Special
Assessment
,
2021
,
3.125
%
,
5/01/41
.........................................................
100,000
80,971
Lakeside
Preserve
Community
Development
District
,
Special
Assessment
,
2023
,
6.375
%
,
5/01/54
...................................................
100,000
104,794
North
AR-1
Pasco
Community
Development
District
,
Assessment
Area
3
,
Special
Assessment
,
2023
,
6
%
,
5/01/54
.......................................
100,000
102,261
North
Loop
Community
Development
District
,
Special
Assessment
,
2023
,
6.625
%
,
5/01/54
.........................................................
130,000
139,267
Palermo
Community
Development
District
,
Special
Assessment
,
2023
,
5
%
,
6/15/43
..
100,000
100,657
Palm
Coast
Park
Community
Development
District
,
Special
Assessment
,
2023
,
5.6
%
,
5/01/53
.........................................................
100,000
101,720
Preserve
at
Savannah
Lakes
Community
Development
District
,
Assessment
Area
1
,
Special
Assessment
,
2024
,
5.45
%
,
5/01/44
..............................
100,000
100,777
Prosperity
Lakes
Community
Development
District
,
Assessment
Area
1
,
Special
Assessment
,
2023
,
6.125
%
,
12/15/53
...................................
160,000
166,978
Quail
Roost
Community
Development
District
,
Expansion
Area
,
Special
Assessment
,
2021
,
4
%
,
12/15/51
................................................
70,000
61,259
Ridge
at
Apopka
Community
Development
District
,
Parcel
2
,
Special
Assessment
,
2023
,
5.75
%
,
5/01/53
...............................................
100,000
101,055
River
Hall
Community
Development
District
,
Assessment
Area
4
,
Special
Assessment
,
2023
A
,
6.5
%
,
5/01/54
..............................................
105,000
110,660
Sawgrass
Village
Community
Development
District
,
Assessment
Area
1
,
Special
Assessment
,
2023
,
5.75
%
,
5/01/53
...............
100,000
101,197
Assessment
Area
2
,
Special
Assessment
,
2023
,
6.375
%
,
11/01/53
.............
155,000
161,923
b
Seaton
Creek
Reserve
Community
Development
District
,
Assessment
Area
1
,
Special
Assessment
,
144A,
2023
,
5.5
%
,
6/15/53
................................
100,000
101,956
Seminole
Palms
Community
Development
District
,
Special
Assessment
,
2023
,
5.5
%
,
5/01/43
.........................................................
100,000
102,156
Silver
Oaks
Community
Development
District
,
Special
Assessment
,
2024
,
5.85
%
,
5/01/54
.........................................................
100,000
100,686
Stonegate
Preserve
Community
Development
District
,
Special
Assessment
,
2023
,
6.125
%
,
12/15/53
..................................................
150,000
156,083
Twisted
Oaks
Pointe
Community
Development
District
,
Assessment
Area
1
,
Special
Assessment
,
2023
,
5.375
%
,
5/01/43
..............
100,000
100,820
Assessment
Area
2
,
Special
Assessment
,
2023
,
6.125
%
,
5/01/54
..............
75,000
77,167
Westwood
of
Pasco
Community
Development
District
,
Assessments
,
Special
Assessment
,
2023
,
5.625
%
,
5/01/53
...................................
100,000
101,673
2,729,072
Illinois
1.9%
Metropolitan
Pier
&
Exposition
Authority
,
Revenue
,
2020
A
,
Refunding
,
5
%
,
6/15/50
..
250,000
257,093
Indiana
0.9%
Indianapolis
Local
Public
Improvement
Bond
Bank
,
Revenue,
Senior
Lien
,
2023
E
,
6.125
%
,
3/01/57
...................................................
110,000
118,751
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
H
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
18
a
a
Principal
Amount
a
Value
a
a
a
a
a
Municipal
Bonds
(continued)
Iowa
2.5%
Iowa
Finance
Authority
,
Iowa
Fertilizer
Co.
LLC
,
Revenue
,
2022
,
Refunding
,
5
%
,
12/01/50
.............
$
235,000
$
247,567
Lifespace
Communities,
Inc.
Obligated
Group
,
Revenue
,
2016
A
,
5
%
,
5/15/36
....
100,000
95,848
343,415
Louisiana
1.7%
Calcasieu
Parish
Memorial
Hospital
Service
District
,
Southwest
Louisiana
Healthcare
System
Obligated
Group
,
Revenue
,
2019
,
Refunding
,
5
%
,
12/01/39
............
100,000
93,147
b
Louisiana
Local
Government
Environmental
Facilities
&
Community
Development
Authority
,
Parish
of
St.
Martin
,
Revenue
,
144A,
2019
,
4.4
%
,
11/01/44
...........
135,000
130,891
224,038
Maryland
3.2%
b
City
of
Baltimore
,
Harbor
Point
Special
Taxing
District
,
Tax
Allocation,
Senior
Lien
,
144A,
2019
A
,
Refunding
,
3.5
%
,
6/01/39
................................
100,000
86,633
Maryland
Economic
Development
Corp.
,
Morgan
View
&
Thurgood
Marshall
Student
Housing
,
Revenue
,
2020
,
4.25
%
,
7/01/50
................................
170,000
157,132
b
Town
of
La
Plata
,
Heritage
Green
Special
Taxing
District
,
Special
Tax
,
144A,
2023
A
,
6.5
%
,
2/15/53
....................................................
190,000
193,413
437,178
Michigan
0.8%
City
of
Detroit
,
GO
,
2023
C
,
6
%
,
5/01/43
..................................
100,000
111,659
Minnesota
0.7%
City
of
Apple
Valley
,
PHS
Apple
Valley
Senior
Housing,
Inc.
,
Revenue
,
2021
,
4
%
,
9/01/36
.........................................................
105,000
99,159
Nevada
0.7%
Henderson
Local
Improvement
Districts
,
Local
Improvement
District
No.
T-22
,
Special
Assessment
,
2023
,
5.25
%
,
3/01/53
....................................
100,000
99,922
New
Hampshire
1.9%
New
Hampshire
Business
Finance
Authority
,
Presbyterian
Homes
Obligated
Group
,
Revenue
,
2023
A
,
5.25
%
,
7/01/48
.....................................
250,000
258,322
New
Jersey
1.3%
Tobacco
Settlement
Financing
Corp.
,
Revenue
,
2018
B
,
Refunding
,
5
%
,
6/01/46
....
175,000
178,334
New
York
4.3%
New
York
Transportation
Development
Corp.
,
Delta
Air
Lines,
Inc.
,
Revenue
,
2020
,
4
%
,
10/01/30
.........................
100,000
99,957
Delta
Air
Lines,
Inc.
,
Revenue
,
2020
,
4.375
%
,
10/01/45
.....................
375,000
370,022
b
Oneida
Indian
Nation
of
New
York
,
Revenue
,
144A,
2024
B
,
6
%
,
9/01/43
..........
100,000
104,311
574,290
Ohio
9.6%
Buckeye
Tobacco
Settlement
Financing
Authority
,
Revenue,
Senior
Lien
,
2020
B-2
,
2
,
Refunding
,
5
%
,
6/01/55
.............................................
1,100,000
1,049,794
Ohio
Housing
Finance
Agency
,
Revenue
,
2023
C
,
8
%
,
8/01/34
.................
100,000
102,857
Summit
County
Development
Finance
Authority
,
UAkronPark,
Inc.
,
Revenue
,
2023
,
6
%
,
12/01/58
........................................................
125,000
134,236
1,286,887
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
H
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
19
a
a
Principal
Amount
a
Value
a
a
a
a
a
Municipal
Bonds
(continued)
Pennsylvania
2.6%
Berks
County
Industrial
Development
Authority
,
Tower
Health
Obligated
Group
,
Revenue
,
2017
,
Refunding
,
4
%
,
11/01/50
................................
$
115,000
$
59,713
Berks
County
Municipal
Authority
(The)
,
Tower
Health
Obligated
Group
,
Revenue
,
2012
A
,
5
%
,
11/01/44
...................................................
55,000
28,525
Philadelphia
Authority
for
Industrial
Development
,
St.
Joseph's
University
,
Revenue
,
2022
,
5.5
%
,
11/01/60
...............................................
250,000
268,585
356,823
Texas
7.4%
b
City
of
Anna
,
Woods
at
Lindsey
Place
(The)
Public
Improvement
District
Area
1
,
Special
Assessment
,
144A,
2023
,
5.875
%
,
9/15/53
.........................
116,000
118,465
b
City
of
Celina
,
Chalk
Hill
Public
Improvement
District
No.
2
,
Special
Assessment
,
144A,
2023
,
6
%
,
9/01/53
........................................................
100,000
101,291
Pravin
Public
Improvement
District
,
Special
Assessment
,
144A,
2023
,
6.75
%
,
9/01/53
100,000
101,573
b
City
of
Fate
,
Williamsburg
Public
Improvement
District
No.
1
Phase
3B
,
Special
Assessment
,
144A,
2023
,
5.375
%
,
8/15/53
...............................
100,000
100,489
b
City
of
Hutto
,
Emory
Crossing
Public
Improvement
District
Improvement
Area
No.
2
,
Special
Assessment
,
144A,
2023
,
5.625
%
,
9/01/58
.........................
115,000
117,465
b
City
of
Kyle
,
Southwest
Kyle
Public
Improvement
District
No.
1
Improvement
Area
No.
2
,
Special
Assessment
,
144A,
2023
,
6.75
%
,
9/01/48
........................
100,000
105,948
b
City
of
Tomball
,
Raburn
Reserve
Public
Improvement
District
Area
No.
2
,
Special
Assessment
,
144A,
2023
,
5.75
%
,
9/15/52
...............................
112,000
113,886
b
County
of
Hays
,
La
Cima
Public
Improvement
District
,
Special
Assessment
,
144A,
2020
,
3.25
%
,
9/15/30
...............................................
100,000
89,747
New
Hope
Cultural
Education
Facilities
Finance
Corp.
,
NCCD-College
Station
Properties
LLC
,
Revenue
,
A
,
5
%
,
7/01/47
..............
50,000
44,750
Quality
Senior
Housing
Foundation
of
East
Texas,
Inc.
,
Revenue
,
2019
A-1
,
5
%
,
12/01/39
.......................................................
85,000
82,117
Quality
Senior
Housing
Foundation
of
East
Texas,
Inc.
,
Revenue,
Second
Tier
,
2019
B
,
5.5
%
,
12/01/54
................................................
20,000
18,950
994,681
Washington
2.2%
Washington
State
Housing
Finance
Commission
,
Eastside
Retirement
Association
Obligated
Group
,
Revenue
,
2023
A
,
Refunding
,
5
%
,
7/01/48
........................................................
220,000
223,731
b
Presbyterian
Retirement
Communities
Northwest
Obligated
Group
,
Revenue
,
144A,
2019
A
,
5
%
,
1/01/55
..............................................
100,000
66,156
289,887
Wisconsin
3.0%
Public
Finance
Authority
,
b
Friends
Homes
Obligated
Group
,
Revenue
,
144A,
2019
,
Refunding
,
5
%
,
9/01/49
..
125,000
112,847
RED
River
Valley
Alliance
LLC
,
Revenue
,
2021
,
4
%
,
9/30/51
.................
345,000
286,047
398,894
U.S.
Territories
9.9%
District
of
Columbia
1.9%
District
of
Columbia
,
International
School
Obligated
Group
,
Revenue
,
2019
,
5
%
,
7/01/49
............
140,000
141,170
Plenary
Infrastructure
DC
LLC
,
Revenue
,
2022
A
,
5.5
%
,
8/31/33
..............
100,000
116,383
257,553
Puerto
Rico
8.0%
Commonwealth
of
Puerto
Rico
,
GO
,
2022
A-1
,
4
%
,
7/01/41
..........................................
100,000
92,883
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
H
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
20
a
a
Principal
Amount
a
Value
a
a
a
a
a
Municipal
Bonds
(continued)
U.S.
Territories
(continued)
Puerto
Rico
(continued)
Commonwealth
of
Puerto
Rico,
(continued)
GO
,
2022
A-1
,
4
%
,
7/01/46
..........................................
$
176,000
$
159,070
GDB
Debt
Recovery
Authority
of
Puerto
Rico
,
7.5
%
,
8/20/40
...................
99,066
94,608
Puerto
Rico
Sales
Tax
Financing
Corp.
,
Sales
Tax
,
Revenue
,
A-1
,
5
%
,
7/01/58
.....
722,000
727,413
1,073,974
Total
U.S.
Territories
....................................................................
1,331,527
Total
Municipal
Bonds
(Cost
$
11,900,318
)
......................................
12,160,733
Total
Long
Term
Investments
(Cost
$
13,143,192
)
................................
13,378,233
a
a
a
a
a
a
Total
Investments
(Cost
$
13,143,192
)
99.3
%
....................................
$13,378,233
Other
Assets,
less
Liabilities
0.7
%
.............................................
87,883
Net
Assets
100.0%
...........................................................
$13,466,116
See
A
bbreviations
on
page
43
.
a
See
Note
3(d)
regarding
investments
in
affiliated
management
investment
companies.
b
Security
was
purchased
pursuant
to
Rule
144A
or
Regulation
S
under
the
Securities
Act
of
1933.
144A
securities
may
be
sold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers
or
in
a
public
offering
registered
under
the
Securities
Act
of
1933.
Regulation
S
securities
cannot
be
sold
in
the
United
States
without
either
an
effective
registration
statement
filed
pursuant
to
the
Securities
Act
of
1933,
or
pursuant
to
an
exemption
from
registration.
At
February
29,
2024,
the
aggregate
value
of
these
securities
was
$3,056,135,
representing
22.7%
of
net
assets.
c
The
maturity
date
shown
represents
the
mandatory
put
date.
Franklin
Strategic
Series
Financial
Highlights
Franklin
Templeton
SMACS:
Series
I
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
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financial
statements.
Semiannual
Report
21
a
Six
Months
Ended
February
29,
2024
(unaudited)
Year
Ended
August
31,
Year
Ended
August
31,
2019
a
2023
2022
2021
2020
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$7.78
$7.83
$9.73
$8.95
$10.12
$10.00
Income
from
investment
operations
b
:
Net
investment
income
c
.............
0.30
0.64
0.65
0.66
0.64
0.19
Net
realized
and
unrealized
gains
(losses)
0.07
(0.07)
(1.85)
0.78
(1.10)
0.04
Total
from
investment
operations
........
0.37
0.57
(1.20)
1.44
(0.46)
0.23
Less
distributions
from:
Net
investment
income
..............
(0.30)
(0.62)
(0.70)
(0.66)
(0.71)
(0.11)
Tax
return
of
capital
................
-
(-)
d
(-)
d
-
-
-
Total
distributions
...................
(0.30)
(0.62)
(0.70)
(0.66)
(0.71)
(0.11)
Net
asset
value,
end
of
period
..........
$7.85
$7.78
$7.83
$9.73
$8.95
$10.12
Total
return
e
.......................
4.87%
7.57%
(12.87)%
16.48%
(4.51)%
2.25%
Ratios
to
average
net
assets
f
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.08%
0.20%
1.27%
3.10%
3.55%
5.96%
Expenses
net
of
waiver
and
payments
by
affiliates
..........................
-%
-%
g
-%
-%
g
-%
g
-%
Net
investment
income
...............
7.94%
8.24%
7.72%
7.01%
6.98%
7.61%
Supplemental
data
Net
assets,
end
of
period
(000's)
........
$245,601
$109,051
$19,910
$3,699
$3,506
$3,774
Portfolio
turnover
rate
................
7.43%
27.73%
30.22%
32.50%
43.24%
-%
a
For
the
period
June
3,
2019
(commencement
of
operations)
to
August
31,
2019.
b
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund's
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
c
Based
on
average
daily
shares
outstanding.
d
Amount
rounds
to
less
than
$0.01
per
share.
e
Total
return
is
not
annualized
for
periods
less
than
one
year.
f
Ratios
are
annualized
for
periods
less
than
one
year,
except
for
non-recurring
expenses,
if
any.
g
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited),
February
29,
2024
Franklin
Templeton
SMACS:
Series
I
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
22
a
a
Shares
a
Value
a
Common
Stocks
0.7%
Banks
0.7%
Bank
of
America
Corp.
...............................................
45,000
$
1,553,400
Total
Common
Stocks
(Cost
$1,242,963)
.......................................
1,553,400
a
a
Equity-Linked
Securities
2.4%
Automobiles
0.2%
b
Royal
Bank
of
Canada
into
General
Motors
Co.,
144A,
12%,
6/18/24
.............
14,000
523,453
Banks
0.9%
b
BNP
Paribas
Issuance
BV
into
Bank
of
America
Corp.,
144A,
8.5%,
2/26/25
.......
28,800
978,182
b
Royal
Bank
of
Canada
into
Citigroup,
Inc.,
144A,
10%,
10/15/24
................
27,000
1,277,797
2,255,979
Hotels,
Restaurants
&
Leisure
0.7%
b
Wells
Fargo
Bank
NA
into
Starbucks
Corp.,
144A,
8%,
3/04/25
.................
17,500
1,666,226
Insurance
0.4%
b
BNP
Paribas
Issuance
BV
into
MetLife,
Inc.,
144A,
9%,
10/23/24
................
15,000
1,017,624
Metals
&
Mining
0.2%
b
Royal
Bank
of
Canada
into
Freeport-McMoRan,
Inc.,
144A,
10%,
5/03/24
.........
13,000
499,021
Total
Equity-Linked
Securities
(Cost
$5,692,347)
................................
5,962,303
Principal
Amount
a
a
a
a
Corporate
Bonds
93.2%
Aerospace
&
Defense
2.5%
b
Bombardier,
Inc.
,
Senior
Note
,
144A,
8.75
%
,
11/15/30
........................
$
1,500,000
1,573,140
b
TransDigm
,
Inc.
,
Senior
Secured
Note,
144A,
6.75%,
8/15/28
..............................
1,500,000
1,519,809
Senior
Secured
Note,
144A,
6.875%,
12/15/30
............................
1,500,000
1,519,365
Senior
Secured
Note,
144A,
6.625%,
3/01/32
.............................
1,500,000
1,511,247
6,123,561
Automobile
Components
1.4%
b
Dornoch
Debt
Merger
Sub,
Inc.
,
Senior
Note
,
144A,
6.625
%
,
10/15/29
...........
750,000
674,142
Goodyear
Tire
&
Rubber
Co.
(The)
,
Senior
Note
,
5.25
%
,
7/15/31
................
3,000,000
2,710,365
3,384,507
Automobiles
2.4%
Ford
Motor
Co.
,
Senior
Bond
,
6.1
%
,
8/19/32
...............................
6,000,000
5,993,574
Banks
4.3%
Barclays
plc
,
Senior
Bond,
5.746%
to
8/08/32,
FRN
thereafter,
8/09/33
....................
1,400,000
1,388,505
c
Senior
Bond,
FRN,
6.692%,
(SOFR
+
2.62%),
9/13/34
......................
1,500,000
1,569,692
Sub.
Bond,
7.119%
to
6/26/33,
FRN
thereafter,
6/27/34
.....................
1,500,000
1,557,823
Fifth
Third
Bancorp
,
Senior
Note
,
6.339%
to
7/26/28,
FRN
thereafter
,
7/27/29
......
350,000
359,273
Fifth
Third
Bank
NA
,
Senior
Note
,
5.852%
to
10/26/24,
FRN
thereafter
,
10/27/25
....
250,000
249,700
JPMorgan
Chase
&
Co.
,
Senior
Bond,
6.254%
to
10/22/33,
FRN
thereafter,
10/23/34
..................
750,000
795,902
Senior
Note,
5.04%
to
1/22/27,
FRN
thereafter,
1/23/28
.....................
1,500,000
1,492,449
Morgan
Stanley
Bank
NA
,
Senior
Note
,
4.952%
to
1/13/27,
FRN
thereafter
,
1/14/28
..
1,500,000
1,492,873
Wells
Fargo
&
Co.
,
Senior
Bond
,
6.491%
to
10/22/33,
FRN
thereafter
,
10/23/34
.....
1,500,000
1,595,838
10,502,055
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
I
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
23
a
a
Principal
Amount
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Building
Products
1.3%
b
AmeriTex
HoldCo
Intermediate
LLC
,
Senior
Secured
Note
,
144A,
10.25
%
,
10/15/28
.
$
1,500,000
$
1,573,125
b
Camelot
Return
Merger
Sub,
Inc.
,
Senior
Secured
Note
,
144A,
8.75
%
,
8/01/28
.....
1,000,000
1,027,105
b
EMRLD
Borrower
LP
/
Emerald
Co-Issuer,
Inc.
,
Senior
Secured
Note
,
144A,
6.625
%
,
12/15/30
........................................................
500,000
502,375
3,102,605
Capital
Markets
1.3%
Charles
Schwab
Corp.
(The)
,
Senior
Note,
5.643%
to
5/18/28,
FRN
thereafter,
5/19/29
....................
500,000
506,554
Senior
Note,
6.196%
to
11/16/28,
FRN
thereafter,
11/17/29
...................
500,000
516,479
Morgan
Stanley
,
Senior
Bond,
6.627%
to
10/31/33,
FRN
thereafter,
11/01/34
..................
1,000,000
1,084,062
Sub.
Bond,
5.948%
to
1/18/33,
FRN
thereafter,
1/19/38
.....................
1,000,000
997,829
3,104,924
Chemicals
1.8%
Celanese
US
Holdings
LLC
,
Senior
Note
,
6.55
%
,
11/15/30
....................
1,000,000
1,040,380
b
Rain
Carbon,
Inc.
,
Senior
Secured
Note
,
144A,
12.25
%
,
9/01/29
................
700,000
700,966
b
SCIH
Salt
Holdings,
Inc.
,
Senior
Note,
144A,
6.625%,
5/01/29
....................................
2,000,000
1,820,849
Senior
Secured
Note,
144A,
4.875%,
5/01/28
.............................
1,000,000
915,015
4,477,210
Commercial
Services
&
Supplies
1.4%
b
APX
Group,
Inc.
,
Senior
Secured
Note
,
144A,
6.75
%
,
2/15/27
..................
3,500,000
3,508,085
Communications
Equipment
3.1%
b
CommScope
Technologies
LLC
,
Senior
Note
,
144A,
6
%
,
6/15/25
................
3,000,000
2,447,940
b
CommScope,
Inc.
,
Senior
Note,
144A,
8.25%,
3/01/27
.....................................
3,000,000
1,316,820
Senior
Secured
Note,
144A,
6%,
3/01/26
................................
3,500,000
3,154,182
Senior
Secured
Note,
144A,
4.75%,
9/01/29
..............................
1,000,000
686,025
7,604,967
Consumer
Finance
2.3%
AerCap
Ireland
Capital
DAC
/
AerCap
Global
Aviation
Trust
,
Senior
Bond
,
5.3
%
,
1/19/34
.........................................................
1,500,000
1,448,432
Ford
Motor
Credit
Co.
LLC
,
Senior
Bond,
5.113%,
5/03/29
........................................
1,000,000
964,171
Senior
Note,
7.35%,
3/06/30
.........................................
3,000,000
3,182,095
5,594,698
Containers
&
Packaging
4.6%
b
Ardagh
Metal
Packaging
Finance
USA
LLC
/
Ardagh
Metal
Packaging
Finance
plc
,
Senior
Note
,
144A,
4
%
,
9/01/29
.......................................
1,500,000
1,219,959
b
Ardagh
Packaging
Finance
plc
/
Ardagh
Holdings
USA,
Inc.
,
Senior
Note,
144A,
5.25%,
8/15/27
.....................................
5,000,000
3,632,233
Senior
Secured
Note,
144A,
4.125%,
8/15/26
.............................
2,500,000
2,309,425
b
Mauser
Packaging
Solutions
Holding
Co.
,
Secured
Note,
144A,
9.25%,
4/15/27
...................................
1,600,000
1,557,781
Senior
Secured
Note,
144A,
7.875%,
8/15/26
.............................
2,500,000
2,534,855
11,254,253
Diversified
REITs
0.3%
b
VICI
Properties
LP
/
VICI
Note
Co.,
Inc.
,
Senior
Bond
,
144A,
4.625
%
,
12/01/29
.....
750,000
698,880
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
I
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
24
a
a
Principal
Amount
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Diversified
Telecommunication
Services
0.8%
b
CCO
Holdings
LLC
/
CCO
Holdings
Capital
Corp.
,
Senior
Bond
,
144A,
5.125
%
,
5/01/27
$
2,000,000
$
1,892,740
Electric
Utilities
3.2%
b
NRG
Energy,
Inc.
,
Senior
Secured
Bond
,
144A,
7
%
,
3/15/33
...................
2,000,000
2,084,629
Pacific
Gas
and
Electric
Co.
,
Senior
Bond
,
6.4
%
,
6/15/33
.....................
3,000,000
3,121,470
PG&E
Corp.
,
Senior
Secured
Note
,
5
%
,
7/01/28
............................
500,000
477,373
b
Vistra
Operations
Co.
LLC
,
Senior
Secured
Bond
,
144A,
6.95
%
,
10/15/33
.........
2,000,000
2,085,520
7,768,992
Electrical
Equipment
0.3%
b
Regal
Rexnord
Corp.
,
Senior
Note
,
144A,
6.05
%
,
4/15/28
.....................
750,000
754,931
Energy
Equipment
&
Services
1.1%
b
Weatherford
International
Ltd.
,
Senior
Note
,
144A,
8.625
%
,
4/30/30
..............
2,750,000
2,853,276
Entertainment
1.0%
b
Netflix,
Inc.
,
Senior
Bond
,
144A,
5.375
%
,
11/15/29
..........................
2,500,000
2,540,061
Financial
Services
1.1%
b
MPH
Acquisition
Holdings
LLC
,
Senior
Secured
Note
,
144A,
5.5
%
,
9/01/28
........
3,000,000
2,620,830
Food
Products
0.9%
JBS
USA
LUX
SA
/
JBS
USA
Food
Co.
/
JBS
USA
Finance,
Inc.
,
Senior
Note
,
5.75
%
,
4/01/33
.........................................................
800,000
776,355
b
Post
Holdings,
Inc.
,
Senior
Bond,
144A,
5.5%,
12/15/29
....................................
500,000
478,800
Senior
Secured
Note,
144A,
6.25%,
2/15/32
..............................
1,000,000
1,006,419
2,261,574
Ground
Transportation
0.3%
b
Ashtead
Capital,
Inc.
,
Senior
Bond
,
144A,
5.95
%
,
10/15/33
....................
750,000
754,614
Health
Care
Equipment
&
Supplies
4.4%
b
Bausch
+
Lomb
Corp.
,
Senior
Secured
Note
,
144A,
8.375
%
,
10/01/28
............
5,500,000
5,754,375
b
Medline
Borrower
LP
,
Senior
Note,
144A,
5.25%,
10/01/29
....................................
3,500,000
3,240,759
Senior
Secured
Note,
144A,
3.875%,
4/01/29
.............................
2,000,000
1,794,996
10,790,130
Health
Care
Providers
&
Services
17.3%
b
CHS/Community
Health
Systems,
Inc.
,
Secured
Note,
144A,
6.125%,
4/01/30
..................................
3,000,000
1,880,070
Senior
Note,
144A,
6.875%,
4/01/28
....................................
2,080,000
1,345,353
Senior
Secured
Note,
144A,
8%,
3/15/26
................................
3,457,000
3,425,800
Senior
Secured
Note,
144A,
5.625%,
3/15/27
.............................
5,000,000
4,580,529
Senior
Secured
Note,
144A,
8%,
12/15/27
...............................
7,500,000
7,181,775
Senior
Secured
Note,
144A,
10.875%,
1/15/32
............................
5,000,000
5,097,755
CVS
Health
Corp.
,
Senior
Bond
,
5.25
%
,
2/21/33
............................
50,000
49,509
b
DaVita,
Inc.
,
Senior
Bond
,
144A,
3.75
%
,
2/15/31
............................
5,000,000
4,108,888
b
Kedrion
SpA
,
Senior
Secured
Note
,
144A,
6.5
%
,
9/01/29
......................
1,000,000
901,176
Tenet
Healthcare
Corp.
,
Senior
Note,
6.125%,
10/01/28
........................................
6,500,000
6,431,847
Senior
Secured
Note,
6.125%,
6/15/30
..................................
2,000,000
1,983,220
b
Senior
Secured
Note,
144A,
6.75%,
5/15/31
..............................
5,500,000
5,555,000
42,540,922
Health
Care
REITs
0.3%
MPT
Operating
Partnership
LP
/
MPT
Finance
Corp.
,
Senior
Bond
,
5
%
,
10/15/27
...
800,000
655,554
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
I
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
25
a
a
Principal
Amount
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Hotels,
Restaurants
&
Leisure
8.6%
b
Caesars
Entertainment,
Inc.
,
Senior
Note,
144A,
8.125%,
7/01/27
....................................
$
3,000,000
$
3,082,353
Senior
Note,
144A,
4.625%,
10/15/29
...................................
1,000,000
913,621
Senior
Secured
Note,
144A,
7%,
2/15/30
................................
1,500,000
1,537,873
b
Carnival
Corp.
,
Senior
Note
,
144A,
10.5
%
,
6/01/30
..........................
5,000,000
5,459,186
b
Fertitta
Entertainment
LLC
/
Fertitta
Entertainment
Finance
Co.,
Inc.
,
Senior
Note,
144A,
6.75%,
1/15/30
.....................................
2,000,000
1,768,388
Senior
Secured
Note,
144A,
4.625%,
1/15/29
.............................
1,000,000
908,490
b
Penn
Entertainment,
Inc.
,
Senior
Note
,
144A,
4.125
%
,
7/01/29
.................
200,000
168,166
b
Wynn
Las
Vegas
LLC
/
Wynn
Las
Vegas
Capital
Corp.
,
Senior
Bond
,
144A,
5.25
%
,
5/15/27
.........................................................
6,500,000
6,367,442
b
Wynn
Resorts
Finance
LLC
/
Wynn
Resorts
Capital
Corp.
,
Senior
Note
,
144A,
7.125
%
,
2/15/31
.........................................................
1,000,000
1,033,308
21,238,827
Household
Durables
0.4%
Shea
Homes
LP
/
Shea
Homes
Funding
Corp.
,
Senior
Note
,
4.75
%
,
4/01/29
.......
1,000,000
940,288
Household
Products
0.1%
b
Energizer
Holdings,
Inc.
,
Senior
Note
,
144A,
6.5
%
,
12/31/27
...................
200,000
198,464
Independent
Power
and
Renewable
Electricity
Producers
2.0%
b
Calpine
Corp.
,
Senior
Note
,
144A,
4.625
%
,
2/01/29
..........................
2,000,000
1,842,729
b,d
Vistra
Corp.
,
Junior
Sub.
Bond
,
144A,
8%
to
10/14/26,
FRN
thereafter
,
Perpetual
....
3,000,000
3,003,225
4,845,954
Insurance
0.3%
Brown
&
Brown,
Inc.
,
Senior
Bond
,
2.375
%
,
3/15/31
.........................
1,000,000
819,389
Machinery
0.1%
b
TK
Elevator
US
Newco,
Inc.
,
Senior
Secured
Note
,
144A,
5.25
%
,
7/15/27
.........
200,000
192,400
Media
1.8%
b
Clear
Channel
Outdoor
Holdings,
Inc.
,
Senior
Note,
144A,
7.5%,
6/01/29
.....................................
300,000
248,568
Senior
Secured
Note,
144A,
5.125%,
8/15/27
.............................
900,000
842,527
b
Stagwell
Global
LLC
,
Senior
Note
,
144A,
5.625
%
,
8/15/29
.....................
200,000
178,760
b
Univision
Communications,
Inc.
,
Senior
Secured
Note
,
144A,
6.625
%
,
6/01/27
.....
3,250,000
3,152,963
4,422,818
Metals
&
Mining
2.6%
b
Alcoa
Nederland
Holding
BV
,
Senior
Note
,
144A,
4.125
%
,
3/31/29
...............
750,000
687,673
ArcelorMittal
SA
,
Senior
Bond
,
6.8
%
,
11/29/32
..............................
1,500,000
1,586,561
b
Cleveland-Cliffs,
Inc.
,
Senior
Bond
,
144A,
4.875
%
,
3/01/31
....................
150,000
135,221
b
First
Quantum
Minerals
Ltd.
,
Senior
Note,
144A,
6.875%,
3/01/26
....................................
400,000
400,000
Senior
Note,
144A,
8.625%,
6/01/31
....................................
250,000
239,067
b
FMG
Resources
August
2006
Pty.
Ltd.
,
Senior
Bond,
144A,
4.375%,
4/01/31
...................................
800,000
717,728
Senior
Bond,
144A,
6.125%,
4/15/32
...................................
2,000,000
1,978,398
b
Mineral
Resources
Ltd.
,
Senior
Note
,
144A,
8.5
%
,
5/01/30
....................
550,000
565,526
6,310,174
Oil,
Gas
&
Consumable
Fuels
6.0%
b
Calumet
Specialty
Products
Partners
LP
/
Calumet
Finance
Corp.
,
Senior
Note,
144A,
11%,
4/15/25
......................................
1,000,000
1,008,340
Senior
Note,
144A,
8.125%,
1/15/27
....................................
3,000,000
2,972,535
Senior
Note,
144A,
9.75%,
7/15/28
.....................................
1,000,000
991,760
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
I
(continued)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
26
a
a
Principal
Amount
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Oil,
Gas
&
Consumable
Fuels
(continued)
Cheniere
Corpus
Christi
Holdings
LLC
,
Senior
Secured
Note
,
3.7
%
,
11/15/29
......
$
1,500,000
$
1,384,163
b
CITGO
Petroleum
Corp.
,
Senior
Secured
Note
,
144A,
7
%
,
6/15/25
..............
300,000
299,582
b
Civitas
Resources,
Inc.
,
Senior
Note
,
144A,
8.75
%
,
7/01/31
....................
750,000
798,541
b
Hilcorp
Energy
I
LP
/
Hilcorp
Finance
Co.
,
Senior
Note
,
144A,
6
%
,
4/15/30
........
1,000,000
971,824
Kinder
Morgan,
Inc.
,
Senior
Bond
,
5.2
%
,
6/01/33
............................
1,500,000
1,460,915
b
Kinetik
Holdings
LP
,
Senior
Note
,
144A,
5.875
%
,
6/15/30
......................
200,000
195,028
Occidental
Petroleum
Corp.
,
Senior
Note
,
8.875
%
,
7/15/30
....................
1,500,000
1,731,572
b
Venture
Global
LNG,
Inc.
,
Senior
Secured
Note
,
144A,
8.125
%
,
6/01/28
..........
1,000,000
1,016,712
Williams
Cos.,
Inc.
(The)
,
Senior
Bond
,
5.65
%
,
3/15/33
.......................
2,000,000
2,034,646
14,865,618
Passenger
Airlines
5.3%
b
American
Airlines,
Inc.
,
Senior
Secured
Note
,
144A,
8.5
%
,
5/15/29
..............
1,500,000
1,577,824
American
Airlines,
Inc.
/
AAdvantage
Loyalty
IP
Ltd.
,
b
Senior
Secured
Note,
144A,
5.5%,
4/20/26
...............................
3,750,000
3,719,562
b
Delta
Air
Lines,
Inc.
/
SkyMiles
IP
Ltd.
,
Senior
Secured
Note
,
144A,
4.75
%
,
10/20/28
.
3,500,000
3,422,966
b
Mileage
Plus
Holdings
LLC
/
Mileage
Plus
Intellectual
Property
Assets
Ltd.
,
Senior
Secured
Note
,
144A,
6.5
%
,
6/20/27
....................................
2,450,000
2,452,619
b
United
Airlines,
Inc.
,
Senior
Secured
Note
,
144A,
4.625
%
,
4/15/29
...............
2,000,000
1,846,770
13,019,741
Personal
Care
Products
0.3%
Haleon
US
Capital
LLC
,
Senior
Note
,
3.625
%
,
3/24/32
.......................
750,000
672,153
Pharmaceuticals
3.7%
b
1375209
BC
Ltd.
,
Senior
Secured
Note
,
144A,
9
%
,
1/30/28
....................
6,000,000
5,872,080
b
Bausch
Health
Cos.,
Inc.
,
Senior
Secured
Note
,
144A,
5.5
%
,
11/01/25
............
1,500,000
1,397,332
b,e
Par
Pharmaceutical,
Inc.
,
Senior
Secured
Note
,
144A,
8.5
%
,
4/01/27
.............
300,000
190,482
Teva
Pharmaceutical
Finance
Netherlands
III
BV
,
Senior
Note
,
8.125
%
,
9
/15/31
....
1,500,000
1,622,412
9,082,306
Semiconductors
&
Semiconductor
Equipment
0.1%
Micron
Technology,
Inc.
,
Senior
Bond
,
5.875
%
,
2/09/33
.......................
200,000
204,419
Software
1.6%
b
Cloud
Software
Group,
Inc.
,
Senior
Secured
Note
,
144A,
6.5
%
,
3/31/29
...........
3,000,000
2,795,649
b
McAfee
Corp.
,
Senior
Note
,
144A,
7.375
%
,
2/15/30
..........................
1,200,000
1,060,497
Workday,
Inc.
,
Senior
Bond
,
3.8
%
,
4/01/32
................................
150,000
135,630
3,991,776
Specialized
REITs
0.1%
American
Tower
Corp.
,
Senior
Note
,
4.05
%
,
3/15/32
.........................
250,000
227,530
Specialty
Retail
0.0%
†
Lowe's
Cos.,
Inc.
,
Senior
Bond
,
5
%
,
4/15/33
...............................
60,000
59,214
Textiles,
Apparel
&
Luxury
Goods
0.8%
b
Hanesbrands,
Inc.
,
Senior
Note
,
144A,
9
%
,
2/15/31
..........................
2,000,000
2,006,511
Tobacco
1.4%
BAT
Capital
Corp.
,
Senior
Bond,
7.75%,
10/19/32
........................................
500,000
559,161
Senior
Bond,
6.421%,
8/02/33
........................................
2,000,000
2,058,708
Senior
Note,
3.557%,
8/15/27
.........................................
950,000
898,510
3,516,379
Franklin
Strategic
Series
Schedule
of
Investments
(unaudited)
Franklin
Templeton
SMACS:
Series
I
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
27
At
February
29,
2024,
the
Fund
had
the
following futures
contracts
outstanding.
See
Note
1
(
c
).
See
Note
9
regarding
other
derivative
information.
a
a
Principal
Amount
a
Value
a
a
a
a
a
Corporate
Bonds
(continued)
Trading
Companies
&
Distributors
0.6%
b
United
Rentals
North
America,
Inc.
,
Senior
Secured
Note
,
144A,
6
%
,
12/15/29
.....
$
1,500,000
$
1,502,688
Total
Corporate
Bonds
(Cost
$226,242,447)
.....................................
228,899,592
Total
Long
Term
Investments
(Cost
$233,177,757)
...............................
236,415,295
a
a
a
a
a
Short
Term
Investments
1.3%
Shares
a
Money
Market
Funds
1.3%
f,g
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.984%
..................
3,257,958
3,257,958
Total
Money
Market
Funds
(Cost
$3,257,958)
...................................
3,257,958
Total
Short
Term
Investments
(Cost
$3,257,958
)
.................................
3,257,958
a
Total
Investments
(Cost
$236,435,715)
97.6%
...................................
$239,673,253
Other
Assets,
less
Liabilities
2.4%
.............................................
5,927,506
Net
Assets
100.0%
...........................................................
$245,600,759
Futures
Contracts
Description
Type
Number
of
Contracts
Notional
Amount
*
Expiration
Date
Value/
Unrealized
Appreciation
(Depreciation)
Interest
rate
contracts
U.S.
Treasury
10
Year
Notes
....................
Long
200
$
22,087,500
6/18/24
$
25,315
U.S.
Treasury
Ultra
Bonds
......................
Long
80
10,230,000
6/18/24
116,100
Total
Futures
Contracts
......................................................................
$141,415
*As
of
period
end.
†
Rounds
to
less
than
0.1%
of
net
assets.
a
See
Note
1(d)
regarding
equity-linked
securities.
b
Security
was
purchased
pursuant
to
Rule
144A
or
Regulation
S
under
the
Securities
Act
of
1933.
144A
securities
may
be
sold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers
or
in
a
public
offering
registered
under
the
Securities
Act
of
1933.
Regulation
S
securities
cannot
be
sold
in
the
United
States
without
either
an
effective
registration
statement
filed
pursuant
to
the
Securities
Act
of
1933,
or
pursuant
to
an
exemption
from
registration.
At
February
29,
2024,
the
aggregate
value
of
these
securities
was
$176,025,300,
representing
71.7%
of
net
assets.
c
The
coupon
rate
shown
represents
the
rate
at
period
end.
d
Perpetual
security
with
no
stated
maturity
date.
e
Defaulted
security
or
security
for
which
income
has
been
deemed
uncollectible.
See
Note
7.
f
See
Note
3(d)
regarding
investments
in
affiliated
management
investment
companies.
g
The
rate
shown
is
the
annualized
seven-day
effective
yield
at
period
end.
See
A
bbreviations
on
pag
e
43
.
Franklin
Strategic
Series
Financial
Statements
Statements
of
Assets
and
Liabilities
February
29,
2024
(unaudited)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
28
Franklin
Templeton
SMACS:
Series
CH
Franklin
Templeton
SMACS:
Series
E
Franklin
Templeton
SMACS:
Series
H
Franklin
Templeton
SMACS:
Series
I
Assets:
Investments
in
securities:
Cost
-
Unaffiliated
issuers
................
$22,258,360
$129,430,449
$11,900,318
$233,177,757
Cost
-
Non-controlled
affiliates
(Note
3d)
.....
-
2,375,288
1,242,874
3,257,958
Value
-
Unaffiliated
issuers
...............
$22,961,006
$133,797,963
$12,160,733
$236,415,295
Value
-
Non-controlled
affiliates
(Note
3d)
....
-
2,375,288
1,217,500
3,257,958
Cash
.................................
5,947
2,055
9,217
-
Receivables:
Capital
shares
sold
.....................
-
488,534
-
886,150
Dividends
and
interest
..................
307,596
365,916
161,833
4,192,736
Affiliates
.............................
6,549
17,692
12,710
21,852
Deposits
with
brokers
for:
Futures
contracts
.....................
-
-
-
937,000
Variation
margin
on
futures
contracts
........
-
-
-
81,250
Prepaid
expenses
.......................
-
-
-
5,161
Total
assets
.......................
23,281,098
137,047,448
13,561,993
245,797,402
Liabilities:
Payables:
Capital
shares
redeemed
................
-
84,726
402
150,711
Registration
and
filing
fees
...............
11,435
15,077
11,186
15,665
Professional
fees
......................
24,198
21,455
25,756
28,752
Trustees'
fees
and
expenses
..............
182
181
94
248
Distributions
to
shareholders
..............
97,936
-
53,554
-
Accrued
expenses
and
other
liabilities
........
2,043
790
4,885
1,267
Total
liabilities
......................
135,794
122,229
95,877
196,643
Net
assets,
at
value
..............
$23,145,304
$136,925,219
$13,466,116
$245,600,759
Net
assets
consist
of:
Paid-in
capital
..........................
$22,549,995
$132,996,470
$13,369,414
$244,611,659
Total
distributable
earnings
(losses)
..........
595,309
3,928,749
96,702
989,100
Net
assets,
at
value
..............
$23,145,304
$136,925,219
$13,466,116
$245,600,759
Shares
outstanding
......................
2,687,827
11,605,694
1,464,304
31,290,993
Net
asset
value
per
share
a
.................
$8.61
$11.80
$9.20
$7.85
a
Net
asset
value
per
share
may
not
recalculate
due
to
rounding.
Franklin
Strategic
Series
Financial
Statements
Statements
of
Operations
for
the
six
months
ended
February
29,
2024
(unaudited)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
29
Franklin
Templeton
SMACS:
Series
CH
Franklin
Templeton
SMACS:
Series
E
Franklin
Templeton
SMACS:
Series
H
Franklin
Templeton
SMACS:
Series
I
Investment
income:
Dividends:
(net
of
foreign
taxes
of
$-,
$22,748,
$-
and
$-,
respectively)
Unaffiliated
issuers
.....................
$-
$1,340,957
$-
$21,600
Non-controlled
affiliate
s
(Note
3d)
..........
-
67,078
22,627
101,255
Interest:
Unaffiliated
issuers
.....................
388,042
139,947
262,691
6,565,136
Other
income
a
..........................
-
4,532
1,750
6,899
Total
investment
income
................
388,042
1,552,514
287,068
6,694,890
Expenses:
Transfer
agent
fees
(Note
3
c
)
...............
326
6,268
730
9,559
Custodian
fees
(Note
4)
...................
3
1,289
3
1,379
Reports
to
shareholders
fees
...............
769
930
774
930
Registration
and
filing
fees
.................
10,959
15,077
11,006
15,665
Professional
fees
........................
23,890
21,453
23,890
34,903
Trustees'
fees
and
expenses
...............
252
647
154
1,075
Pricing
fees
............................
2,208
230
6,095
1,694
Other
.................................
2,743
10,470
4,569
3,330
Total
expenses
......................
41,150
56,364
47,221
68,535
Expenses
waived/paid
by
affiliate
s
(Note
3d
and
3e)
...........................
(41,150)
(56,364)
(47,221)
(68,535)
Net
expenses
......................
-
-
-
-
Net
investment
income
.............
388,042
1,552,514
287,068
6,694,890
Realized
and
unrealized
gains
(losses):
Net
realized
gain
(loss)
from:
Investments:
Unaffiliated
issuers
...................
100,806
1,617,293
(56,775)
101,628
Written
options
........................
-
46,100
-
-
Foreign
currency
transactions
.............
-
(1,920)
-
-
Futures
contracts
......................
-
-
-
14,996
Net
realized
gain
(loss)
...............
100,806
1,661,473
(56,775)
116,624
Net
change
in
unrealized
appreciation
(depreciation)
on:
Investments:
Unaffiliated
issuers
...................
986,748
3,060,173
521,663
3,366,919
Non-controlled
affiliate
s
(Note
3d)
........
-
-
38,057
-
Translation
of
other
assets
and
liabilities
denominated
in
foreign
currencies
........
-
32
-
-
Written
options
........................
-
4,033
-
-
Futures
contracts
......................
-
-
-
(172,586)
Net
change
in
unrealized
appreciation
(depreciation)
......................
986,748
3,064,238
559,720
3,194,333
Net
realized
and
unrealized
gain
(loss)
.........
1,087,554
4,725,711
502,945
3,310,957
Net
increase
(decrease)
in
net
assets
resulting
from
operations
...............................
$1,475,596
$6,278,225
$790,013
$10,005,847
a
Other
income
includes
payments
by
Advisers
for
acquired
fund
fees
and
expenses
(See
Note
3e).
Franklin
Strategic
Series
Financial
Statements
Statements
of
Changes
in
Net
Assets
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
30
Franklin
Templeton
SMACS:
Series
CH
Franklin
Templeton
SMACS:
Series
E
Six
Months
Ended
February
29,
2024
(unaudited)
Year
Ended
August
31,
2023
Six
Months
Ended
February
29,
2024
(unaudited)
Year
Ended
August
31,
2023
Increase
(decrease)
in
net
assets:
Operations:
Net
investment
income
............
$388,042
$140,568
$1,552,514
$1,119,443
Net
realized
gain
(loss)
............
100,806
(188,037)
1,661,473
527,589
Net
change
in
unrealized
appreciation
(depreciation)
.................
986,748
60,122
3,064,238
1,429,417
Net
increase
(decrease)
in
net
assets
resulting
from
operations
.
1,475,596
12,653
6,278,225
3,076,449
Distributions
to
shareholders
.........
(387,293)
(143,020)
(3,155,875)
(2,405,013)
Distributions
to
shareholders
from
tax
return
of
capital
..................
-
-
-
(13,510)
Total
distributions
to
shareholders
.....
(387,293)
(143,020)
(3,155,875)
(2,418,523)
Capital
share
transactions
(Note
2
)
.....
18,159,381
1,070,558
71,811,094
48,470,400
Net
increase
(decrease)
in
net
assets
.....................
19,247,684
940,191
74,933,444
49,128,326
Net
assets:
Beginning
of
period
................
3,897,620
2,957,429
61,991,775
12,863,449
End
of
period
.....................
$23,145,304
$3,897,620
$136,925,219
$61,991,775
Franklin
Strategic
Series
Financial
Statements
Statements
of
Changes
in
Net
Assets
(continued)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
31
Franklin
Templeton
SMACS:
Series
H
Franklin
Templeton
SMACS:
Series
I
Six
Months
Ended
February
29,
2024
(unaudited)
Year
Ended
August
31,
2023
Six
Months
Ended
February
29,
2024
(unaudited)
Year
Ended
August
31,
2023
Increase
(decrease)
in
net
assets:
Operations:
Net
investment
income
............
$287,068
$173,976
$6,694,890
$4,285,289
Net
realized
gain
(loss)
............
(56,775)
(54,946)
116,624
(1,852,936)
Net
change
in
unrealized
appreciation
(depreciation)
.................
559,720
(23,870)
3,194,333
1,597,840
Net
increase
(decrease)
in
net
assets
resulting
from
operations
.
790,013
95,160
10,005,847
4,030,193
Distributions
to
shareholders
.........
(282,163)
(173,185)
(6,852,711)
(4,306,631)
Distributions
to
shareholders
from
tax
return
of
capital
..................
-
-
-
(9,367)
Total
distributions
to
shareholders
.....
(282,163)
(173,185)
(6,852,711)
(4,315,998)
Capital
share
transactions
(Note
2
)
.....
2,899,269
7,118,274
133,396,497
89,426,896
Net
increase
(decrease)
in
net
assets
.....................
3,407,119
7,040,249
136,549,633
89,141,091
Net
assets:
Beginning
of
period
................
10,058,997
3,018,748
109,051,126
19,910,035
End
of
period
.....................
$13,466,116
$10,058,997
$245,600,759
$109,051,126
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
32
franklintempleton.com
Semiannual
Report
1.
Organization
and
Significant
Accounting
Policies
Franklin
Strategic
Series (Trust)
is
registered
under
the
Investment
Company
Act
of
1940
(1940
Act)
as
an
open-
end
management
investment
company,
consisting
of
ten
separate
funds, four of
which
are
included
in
this
report
(Funds).
The Funds
follow
the
accounting
and
reporting
guidance
in
Financial
Accounting
Standards
Board
(FASB)
Accounting
Standards
Codification
Topic
946,
Financial
Services
-
Investment
Companies
(ASC
946)
and
apply
the
specialized
accounting
and
reporting
guidance
in
U.S.
Generally
Accepted
Accounting
Principles
(U.S.
GAAP),
including,
but
not
limited
to,
ASC
946.
The
following
summarizes
the Funds'
significant
accounting
policies.
a.
Financial
Instrument
Valuation
The Funds'
investments
in
financial
instruments
are
carried
at
fair
value
daily.
Fair
value
is
the
price
that
would
be
received
to
sell
an
asset
or
paid
to
transfer
a
liability
in
an
orderly
transaction
between
market
participants
on
the
measurement
date.
The Funds calculate the
net
asset
value
(NAV)
per
share
each
business
day
as
of
4
p.m.
Eastern
time
or
the
regularly
scheduled
close
of
the
New
York
Stock
Exchange
(NYSE),
whichever
is
earlier. Under
compliance
policies
and
procedures
approved
by
the
Trust's
Board
of
Trustees
(the
Board),
the
Board
has
designated
the
Funds'
investment
manager
as
the
valuation
designee
and
has
responsibility
for
oversight
of
valuation.
The
investment
manager
is
assisted
by
the
Funds'
administrator
in
performing
this
responsibility,
including
leading
the
cross-
functional
Valuation
Committee
(VC).
The
Funds
may
utilize
independent
pricing
services,
quotations
from
securities
and
financial
instrument
dealers,
and
other
market
sources
to
determine
fair
value.
Equity
securities,
exchange
traded
funds, and
derivative
financial instruments listed
on
an
exchange
or
on
the
NASDAQ
National
Market
System
are
valued
at
the
last
quoted
sale
price
or
the
official
closing
price of
the
day,
respectively.
Foreign
equity
securities
are
valued
as
of
the
close
of
trading
on
the
foreign
stock
exchange
on
which
the
security
is
primarily
traded,
or
as
of
4
p.m.
Eastern
time.
The
value
is
then
converted
into
its
U.S.
dollar
equivalent
at
the
foreign
exchange
rate
in
effect
at
4
p.m.
Eastern
time
on
the
day
that
the
value
of
the
security
is
determined.
Over-the-
counter
(OTC)
securities
are
valued
within
the
range
of
the
most
recent
quoted
bid
and
ask
prices.
Securities
that
trade
in
multiple
markets
or
on
multiple
exchanges
are
valued
according
to
the
broadest
and
most
representative
market.
Certain
equity
securities
are
valued
based
upon
fundamental
characteristics
or
relationships
to
similar
securities.
Debt
securities
generally
trade
in
the
OTC
market rather
than
on
a
securities
exchange.
The
Funds'
pricing
services
use
multiple
valuation
techniques
to
determine
fair
value.
In
instances
where
sufficient
market
activity
exists,
the
pricing
services
may
utilize
a
market-based
approach
through
which
quotes
from
market
makers
are
used
to
determine
fair
value.
In
instances
where
sufficient
market
activity
may
not
exist
or
is
limited,
the
pricing
services
also
utilize
proprietary
valuation
models
which
may
consider
market
characteristics
such
as
benchmark
yield
curves,
credit
spreads,
estimated
default
rates,
anticipated
market
interest
rate
volatility,
coupon
rates,
anticipated
timing
of
principal
repayments,
underlying
collateral,
and
other
unique
security
features
in
order
to
estimate
the
relevant
cash
flows,
which
are
then
discounted
to
calculate
the
fair
value.
Investments
in open-end mutual
funds
are
valued
at
the
closing
NAV.
Certain
derivative
financial
instruments
trade
in
the
OTC
market.
The
Funds'
pricing
services
use
various
techniques
including
industry
standard
option
pricing
models
and
proprietary
discounted
cash
flow
models
to
determine
the
fair
value
of
those
instruments.
The
Funds'
net
benefit
or
obligation
under
the
derivative
contract,
as
measured
by
the
fair
value
of
the
contract,
is
included
in
net
assets.
The
Funds
have
procedures
to
determine
the
fair
value
of
financial
instruments
for
which
market
prices
are
not
reliable
or
readily
available.
Under
these
procedures,
the
Funds
primarily
employ
a
market-based
approach
which
may
use
related
or
comparable
assets
or
liabilities,
recent
transactions,
market
multiples,
and
other
relevant
information
for
the
investment
to
determine
the
fair
value
of
the
investment.
An
income-based
valuation
approach
may
also
be
used
in
which
the
anticipated
future
cash
flows
of
the
investment
are
discounted
to
calculate
fair
value.
Discounts
may
also
be
applied
due
to
the
nature
or
duration
of
any
restrictions
on
the
disposition
of
the
investments.
Due
to
the
inherent
uncertainty
of
valuations
of
such
investments,
the
fair
values
may
differ
significantly
from
the
values
that
would
have
been
used
had
an
active
market
existed.
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
33
franklintempleton.com
Semiannual
Report
Trading
in
securities
on
foreign
securities
stock
exchanges
and
OTC
markets
may
be
completed
before
4
p.m.
Eastern
time.
In
addition,
trading
in
certain
foreign
markets
may
not
take
place
on
every
Funds'
business
day.
Events
can occur
between
the
time
at
which
trading
in
a
foreign
security
is
completed
and
4
p.m.
Eastern
time
that
might
call
into
question
the
reliability
of
the
value
of
a
portfolio
security
held
by
the
Funds.
As
a
result,
differences
may
arise
between
the
value
of
the
Funds'
portfolio
securities
as
determined
at
the
foreign
market
close
and
the
latest
indications
of
value
at
4
p.m.
Eastern
time.
In
order
to
minimize
the
potential
for
these
differences,
an
independent
pricing
service
may
be
used
to
adjust
the
value
of
the
Funds'
portfolio
securities
to
the
latest
indications
of
fair
value
at
4
p.m.
Eastern
time.
At
February
29,
2024,
certain
securities
may
have
been
fair
valued
using
these
procedures,
in
which
case
the
securities
were
categorized
as
Level
2
within
the
fair
value
hierarchy
(referred
to
as
"market
level
fair
value").
See
the
Fair
Value
Measurements
note
for
more
information.
When
the
last
day
of
the
reporting
period
is
a
non-business
day,
certain
foreign
markets
may
be
open
on
those
days
that
the
Funds'
NAV
is
not
calculated,
which
could
result
in
differences
between
the
value
of
the
Funds'
portfolio
securities
on
the
last
business
day
and
the
last
calendar
day
of
the
reporting
period.
Any
security
valuation
changes
due
to
an
open
foreign
market
are
adjusted
and
reflected
by
the
Funds
for
financial
reporting
purposes.
b.
Foreign
Currency
Translation
Portfolio
securities
and
other
assets
and
liabilities
denominated
in
foreign
currencies
are
translated
into
U.S.
dollars
based
on
the
exchange
rate
of
such
currencies
against
U.S.
dollars
on
the
date
of
valuation.
The
Funds
may
enter
into
foreign
currency
exchange
contracts
to
facilitate
transactions
denominated
in
a
foreign
currency.
Purchases
and
sales
of
securities,
income
and
expense
items
denominated
in
foreign
currencies
are
translated
into
U.S.
dollars
at
the
exchange
rate
in
effect
on
the
transaction
date.
Portfolio
securities
and
assets
and
liabilities
denominated
in
foreign
currencies
contain
risks
that
those
currencies
will
decline
in
value
relative
to
the
U.S.
dollar.
Occasionally,
events
may
impact
the
availability
or
reliability
of
foreign
exchange
rates
used
to
convert
the
U.S.
dollar
equivalent
value.
If
such
an
event
occurs,
the
foreign
exchange
rate
will
be
valued
at
fair
value
using
procedures
established
and
approved
by
the
Board.
The
Funds
do
not
separately
report
the
effect
of
changes
in
foreign
exchange
rates
from
changes
in
market
prices
on
securities
held.
Such
changes
are
included
in
net
realized
and
unrealized
gain
or
loss
from
investments
in
the
Statements
of
Operations.
Realized
foreign
exchange
gains
or
losses
arise
from
sales
of
foreign
currencies,
currency
gains
or
losses
realized
between
the
trade
and
settlement
dates
on
securities
transactions
and
the
difference
between
the
recorded
amounts
of
dividends,
interest,
and
foreign
withholding
taxes
and
the
U.S.
dollar
equivalent
of
the
amounts
actually
received
or
paid.
Net
unrealized
foreign
exchange
gains
and
losses
arise
from
changes
in
foreign
exchange
rates
on
foreign
denominated
assets
and
liabilities
other
than
investments
in
securities
held
at
the
end
of
the
reporting
period.
c.
Derivative
Financial
Instruments
Certain
or
all
Funds
invested
in
derivative
financial
instruments
in
order
to
manage
risk
or
gain
exposure
to
various
other
investments
or
markets.
Derivatives
are
financial
contracts
based
on
an
underlying
or
notional
amount,
require
no
initial
investment
or
an
initial
net
investment
that
is
smaller
than
would
normally
be
required
to
have
a
similar
response
to
changes
in
market
factors,
and
require
or
permit
net
settlement.
Derivatives
contain
various
risks
including
the
potential
inability
of
the
counterparty
to
fulfill
their
obligations
under
the
terms
of
the
contract,
the
potential
for
an
illiquid
secondary
market,
and/or
the
potential
for
market
movements
which
expose
the
Fund
to
gains
or
losses
in
excess
of
the
amounts
shown
in
the
Statements
of
Assets
and
Liabilities.
Realized
gain
and
loss
and
unrealized
appreciation
and
depreciation
on
these
contracts
for
the
period
are
included
in
the
Statements
of
Operations.
Collateral
requirements
differ
by
type
of
derivative.
Collateral
or
initial
margin
requirements
are
set
by
the
broker
or
exchange
clearing
house
for
exchange
traded
and
centrally
cleared
derivatives.
Initial
margin
deposited
is
held
at
the
exchange
and
can
be
in
the
form
of
cash
and/or
securities.
1.
Organization
and
Significant
Accounting
Policies
(continued)
a.
Financial
Instrument
Valuation
(continued)
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
34
franklintempleton.com
Semiannual
Report
Certain
or
all
Funds
entered
into
exchange
traded
futures
contracts
primarily
to
manage
and/or
gain
exposure
to
interest
rate
risk.
A
futures
contract
is
an
agreement
between
the
Fund
and
a
counterparty
to
buy
or
sell
an
asset
at
a
specified
price
on
a
future
date.
Required
initial
margins
are
pledged
by
the
Fund,
and
the
daily
change
in
fair
value
is
accounted
for
as
a
variation
margin
payable
or
receivable
in
the
Statements
of
Assets
and
Liabilities.
At
February
29,
2024,
Franklin
Templeton
SMACS:
Series
CH,
Franklin
Templeton
SMACS:
Series
E
and
Franklin
Templeton
SMACS:
Series
H
had
no
futures
contracts.
Certain
or
all
Funds
purchased
or
wrote
exchange
traded
option
contracts
primarily
to
manage
and/or
gain
exposure
to
equity
price
risk.
An
option
is
a
contract
entitling
the
holder
to
purchase
or
sell
a
specific
amount
of
shares
or
units
of
an
asset
or
notional
amount
of
a
swap
(swaption),
at
a
specified
price.
When
an
option
is
purchased
or
written,
an
amount
equal
to
the
premium
paid
or
received
is
recorded
as
an
asset
or
liability,
respectively.
Upon
exercise
of
an
option,
the
acquisition
cost
or
sales
proceeds
of
the
underlying
investment
is
adjusted
by
any
premium
received
or
paid.
Upon
expiration
of
an
option,
any
premium
received
or
paid
is
recorded
as
a
realized
gain
or
loss.
Upon
closing
an
option
other
than
through
expiration
or
exercise,
the
difference
between
the
premium
received
or
paid
and
the
cost
to
close
the
position
is
recorded
as
a
realized
gain
or
loss.
At February
29,
2024,
Franklin
Templeton
SMACS:
Series
CH,
Franklin
Templeton
SMACS:
Series
E,
Franklin
Templeton
SMACS:
Series
H
and
Franklin
Templeton
SMACS:
Series
I had
no
option
contracts.
See
Note
9 regarding
other
derivative
information.
d.
Equity-Linked
Securities
Certain
or
all
Funds
invest in
equity-linked
securities.
Equity-linked
securities
are
hybrid
financial
instruments
that
generally
combine
both
debt
and
equity
characteristics
into
a
single
note
form.
Income
received
from
equity-linked
securities
is
recorded
as
realized
gains
in
the
Statements
of
Operations
and
may
be
based
on
the
performance
of
an
underlying
equity
security,
an
equity
index,
or
an
option
position.
The
risks
of
investing
in
equity-linked
securities
include
unfavorable
price
movements
in
the
underlying
security
and
the
credit
risk
of
the
issuing
financial
institution.
There
may
be
no
guarantee
of
a
return
of
principal
with
equity-linked
securities
and
the
appreciation
potential
may
be
limited.
Equity-linked
securities
may
be
more
volatile
and
less
liquid
than
other
investments
held
by
the
Funds.
e.
Income
and
Deferred
Taxes
It
is each
Fund's
policy
to
qualify
as
a
regulated
investment
company
under
the
Internal
Revenue
Code. Each
Fund
intends
to
distribute
to
shareholders
substantially
all
of
its
income
and
net
realized
gains
to
relieve
it
from
federal
income
and excise
taxes.
As
a
result,
no
provision
for
U.S.
federal
income
taxes
is
required.
The
Funds
may
be
subject
to
foreign
taxation
related
to
income
received,
capital
gains
on
the
sale
of
securities
and
certain
foreign
currency
transactions
in
the
foreign
jurisdictions
in
which
the
Funds
invest.
Foreign
taxes,
if
any,
are
recorded
based
on
the
tax
regulations
and
rates
that
exist
in
the
foreign
markets
in
which
the
Funds
invest.
When
a
capital
gain
tax
is
determined
to
apply,
certain
or
all
Funds
record
an
estimated
deferred
tax
liability
in
an
amount
that
would
be
payable
if
the
securities
were
disposed
of
on
the
valuation
date.
Each
Fund
may
recognize
an
income
tax
liability
related
to
its
uncertain
tax
positions
under
U.S.
GAAP
when
the
uncertain
tax
position
has
a
less
than
50%
probability
that
it
will
be
sustained
upon
examination
by
the
tax
authorities
based
on
its
technical
merits.
As
of
February
29,
2024, each
Fund
has
determined
that
no
tax
liability
is
required
in
its
financial
statements
related
to
uncertain
tax
positions
for
any
open
tax
years
(or
expected
to
be
taken
in
future
tax
years).
Open
tax
years
are
those
that
remain
subject
to
examination
and
are
based
on
the
statute
of
limitations
in
each
jurisdiction
in
which
the
Fund
invests.
f.
Security
Transactions,
Investment
Income,
Expenses
and
Distributions
Security
transactions
are
accounted
for
on
trade
date.
Realized
gains
and
losses
on
security
transactions
are
determined
on
a
specific
identification
basis.
Interest
income
(including
interest
income
from
payment-in-kind
securities,
if
any)
and
estimated
expenses
are
accrued
daily.
Amortization
of
premium
and
accretion
of
discount
on
debt
securities
are
included
in
interest
income.
Dividend
income
is
recorded
on
the
ex-dividend
date
except
for
certain
dividends
from
securities
where
the
dividend
rate
is
not
available.
In
such
cases,
the
dividend
is
recorded
as
soon
as
the
information
1.
Organization
and
Significant
Accounting
Policies
(continued)
c.
Derivative
Financial
Instruments
(continued)
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
35
franklintempleton.com
Semiannual
Report
is
received
by
the
Funds.
Dividends
from
net
investment
income
are
normally
declared
daily;
these
dividends
may
be
reinvested
or
paid
monthly
to
shareholders
for
Franklin
Templeton
SMACS:
Series
CH
and
Franklin
Templeton
SMACS:
Series
H,
and
recorded
on
ex-dividend
date
for
Franklin
Templeton
SMACS:
Series
E
and
Franklin
Templeton SMACS:
Series
I.
Distributions
from
realized
capital
gains
and
other
distributions,
if
any,
are
recorded
on
the
ex-dividend
date.
Distributable
earnings
are
determined
according
to
income
tax
regulations
(tax
basis)
and
may
differ
from
earnings
recorded
in
accordance
with
U.S.
GAAP.
These
differences
may
be
permanent
or
temporary.
Permanent
differences
are
reclassified
among
capital
accounts
to
reflect
their
tax
character.
These
reclassifications
have
no
impact
on
net
assets
or
the
results
of
operations.
Temporary
differences
are
not
reclassified,
as
they
may
reverse
in
subsequent
periods.
Common
expenses
incurred
by
the
Trust
are
allocated
among
the
Funds
based
on
the
ratio
of
net
assets
of
each
Fund
to
the
combined
net
assets
of
the
Trust
or
based
on
the
ratio
of
number
of
shareholders
of
each
Fund
to
the
combined
number
of
shareholders
of
the
Trust.
Fund
specific
expenses
are
charged
directly
to
the
Fund
that
incurred
the
expense.
g.
Accounting
Estimates
The
preparation
of
financial
statements
in
accordance
with
U.S.
GAAP
requires
management
to
make
estimates
and
assumptions
that
affect
the
reported
amounts
of
assets
and
liabilities
at
the
date
of
the
financial
statements
and
the
amounts
of
income
and
expenses
during
the
reporting
period.
Actual
results
could
differ
from
those
estimates.
h.
Guarantees
and
Indemnifications
Under
the Trust's
organizational
documents,
its
officers
and trustees
are
indemnified
by
the Trust against
certain
liabilities
arising
out
of
the
performance
of
their
duties
to
the
Trust.
Additionally,
in
the
normal
course
of
business,
the Trust,
on
behalf
of
the
Funds, enters
into
contracts
with
service
providers
that
contain
general
indemnification
clauses.
The Trust's
maximum
exposure
under
these
arrangements
is
unknown
as
this
would
involve
future
claims
that
may
be
made
against
the Trust
that
have
not
yet
occurred.
Currently,
the Trust
expects
the
risk
of
loss
to
be
remote.
2.
Shares
of
Beneficial
Interest
At
February
29,
2024,
there
were
an
unlimited
number
of
shares
authorized
(without
par value).
Transactions
in
the
Funds'
shares
were
as
follows:
Franklin
Templeton
SMACS:
Series
CH
Franklin
Templeton
SMACS:
Series
E
Shares
Amount
Shares
Amount
Class
A
Six
Months
ended
February
29,
2024
Shares
sold
...................................
2,265,022
$18,452,699
6,958,537
$79,993,734
Shares
redeemed
...............................
(34,576)
(293,318)
(716,274)
(8,182,640)
Net
increase
(decrease)
..........................
2,230,446
$18,159,381
6,242,263
$71,811,094
Year
ended
August
31,
2023
Shares
sold
...................................
233,719
$2,028,783
4,860,019
$55,681,889
Shares
issued
in
reinvestment
of
distributions
..........
343
2,864
15,103
174,229
Shares
redeemed
...............................
(110,936)
(961,089)
(650,882)
(7,385,718)
Net
increase
(decrease)
..........................
123,126
$1,070,558
4,224,240
$48,470,400
1.
Organization
and
Significant
Accounting
Policies
(continued)
f.
Security
Transactions,
Investment
Income,
Expenses
and
Distributions
(continued)
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
36
franklintempleton.com
Semiannual
Report
3.
Transactions
with
Affiliates
Franklin
Resources,
Inc.
is
the
holding
company
for
various
subsidiaries
that
together
are
referred
to
as
Franklin
Templeton.
Certain
officers
and
trustees
of
the Trust are
also
officers
and/or
directors
of
the
following
subsidiaries:
a.
Management
Fees
Advisers provides
investment
management
services
to
the
Funds.
The
Funds
do
not
pay
a
fee
for
these
services.
b.
Administrative
Fees
Under
an
agreement
with
Advisers,
FT
Services
provides
administrative
services
to
the
Funds
and
is
not
paid
by
the
Funds
for
the services.
c.
Transfer
Agent
Fees
The
Funds pay
transfer
agent
fees,
calculated
monthly
and
paid
monthly, to
Investor
Services
for
its
performance
of
shareholder
servicing
obligations. Effective
October
1,
2023,
the
fees
are based
on
a
fixed
margin
earned
by
Investor
Services
and
are allocated
to
the Funds
based
upon
relative
assets
and
relative
transactions.
Prior
to
October
1,
2023,
the
fees
were
based
on
an
annualized
asset
based
fee
of
0.016%
plus
a transaction
based
fee.
In
addition,
the
Funds reimburse
Investor
Services
for
out
of
pocket
expenses
incurred
and reimburses
shareholder
servicing
fees
paid
to
third
parties.
For
the
period
ended
February
29,
2024,
the Funds
paid
transfer
agent
fees
as
noted
in
the
Statements of
Operations
of
which
the
following
amounts
were
retained
by
Investor
Services:
Franklin
Templeton
SMACS:
Series
H
Franklin
Templeton
SMACS:
Series
I
Shares
Amount
Shares
Amount
Class
A
Six
Months
ended
February
29,
2024
Shares
sold
...................................
480,057
$4,238,870
19,130,195
$147,714,577
Shares
redeemed
...............................
(151,195)
(1,339,601)
(1,864,510)
(14,318,080)
Net
increase
(decrease)
..........................
328,862
$2,899,269
17,265,685
$133,396,497
Year
ended
August
31,
2023
Shares
sold
...................................
800,313
$7,112,553
12,772,496
$99,507,840
Shares
issued
in
reinvestment
of
distributions
..........
662
5,721
35,418
274,618
Shares
redeemed
...............................
-
-
(1,324,698)
(10,355,562)
Net
increase
(decrease)
..........................
800,975
$7,118,274
11,483,216
$89,426,896
Subsidiary
Affiliation
Franklin
Advisers,
Inc.
(Advisers)
Investment
manager
Franklin
Templeton
Services,
LLC
(FT
Services)
Administrative
manager
Franklin
Distributors,
LLC
(Distributors)
Principal
underwriter
Franklin
Templeton
Investor
Services,
LLC
(Investor
Services)
Transfer
agent
Franklin
Templeton
SMACS:
Series
CH
Franklin
Templeton
SMACS:
Series
E
Franklin
Templeton
SMACS:
Series
H
Franklin
Templeton
SMACS:
Series
I
Transfer
agent
fees
........................
$326
$6,268
$730
$9,559
2.
Shares
of
Beneficial
Interest
(continued)
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
37
franklintempleton.com
Semiannual
Report
d.
Investments
in
Affiliated
Management
Investment
Companies
Certain
or
all
Funds
invest
in
one
or
more
affiliated
management
investment
companies.
As
defined
in
the
1940
Act,
an
investment
is
deemed
to
be
a
"Controlled
Affiliate"
of
a
fund
when
a
fund
owns,
either
directly
or
indirectly,
25%
or
more
of
the
affiliated
fund's
outstanding
shares
or
has
the
power
to
exercise
control
over
management
or
policies
of
such
fund.
The
Funds
do
not
invest
for
purposes
of
exercising
a
controlling
influence
over
the
management
or
policies. Advisers
has
contractually
agreed
to
reimburse
expenses
of
the
Funds
in
an
amount
equal
to
fees
indirectly
borne
by
the
Funds
on
assets
invested
in
the
affiliated
management
investment
companies,
as
noted
in
the
Statements
of
Operations.
During
the period
ended
February
29,
2024,
investments
in
affiliated
management
investment
companies
were
as
follows:
e.
Waiver
and
Expense
Reimbursements
Advisers
has
contractually
agreed
in
advance
to
waive
or
limit
its
fees
and
to
assume
as
its
own
expense
certain
expenses
otherwise
payable
by
the
Funds
so
that
the
operating
expenses
(excluding
certain
non-routine
expenses
or
costs,
including
those
relating
to
litigation,
indemnification,
reorganizations,
and
liquidations)
and
acquired
fund
fees
and
expenses
of
the
Funds do
not
exceed
0.00%
based
on
the
average
net
assets
of
each
class
until
December
31,
2024.
Total
expenses
waived
or
paid
are
not
subject
to
recapture
subsequent
to
the
Funds'
fiscal
year
end.
Acquired
fund
fees
and
expenses
are
indirect
expenses,
and
therefore
Advisers
may
make
payments,
if
necessary,
to
the
Funds
to
offset
these
estimated
indirect
expenses.
Payments
by
Advisers for
the period
ended
February
29,
2024,
are
reflected
as
other
income
in
the
Statements
of
Operations.
aa
Value
at
Beginning
of
Period
Purchases
Sales
Realized
Gain
(Loss)
Net
Change
in
Unrealized
Appreciation
(Depreciation)
Value
at
End
of
Period
Number
of
Shares
Held
at
End
of
Period
Investment
Income
a
a
a
a
a
a
a
a
Franklin
Templeton
SMACS:
Series
E
Non-Controlled
Affiliates
Dividends
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.984%
$1,232,610
$54,220,876
$(53,078,198)
$-
$-
$2,375,288
2,375,288
$67,078
Total
Affiliated
Securities
...
$1,232,610
$54,220,876
$(53,078,198)
$-
$-
$2,375,288
$67,078
Franklin
Templeton
SMACS:
Series
H
Non-Controlled
Affiliates
Dividends
Franklin
Dynamic
Municipal
Bond
ETF
...................
$823,989
$355,454
$-
$-
$38,057
$1,217,500
50,000
$22,627
Total
Affiliated
Securities
...
$823,989
$355,454
$-
$-
$38,057
$1,217,500
$22,627
Franklin
Templeton
SMACS:
Series
I
Non-Controlled
Affiliates
Dividends
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
4.984%
$2,191,463
$87,997,275
$(86,930,780)
$-
$-
$3,257,958
3,257,958
$101,255
Total
Affiliated
Securities
...
$2,191,463
$87,997,275
$(86,930,780)
$-
$-
$3,257,958
$101,255
3.
Transactions
with
Affiliates
(continued)
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
38
franklintempleton.com
Semiannual
Report
f.
Other
Affiliated
Transactions
At
February
29,
2024,
Franklin
Resources,
Inc.
owned
a
percentage
of
the
Funds'
outstanding
shares
as
follows:
g.
Interfund
Transactions
Certain
or
all
Funds
engaged
in
purchases
and
sales
of
investments
with
funds
or
other
accounts
that
have
common
investment
managers
(or
affiliated
investment
managers),
directors,
trustees
or
officers.
These
purchases,
sales
and
the
related
net
realized
gains
(losses),
if
any,
for
the
period
ended
February
29,
2024,
were
as
follows:
4.
Expense
Offset
Arrangement
Franklin
Templeton
SMACS:
Series
CH
and
Franklin
Templeton
SMACS:
Series
H
have
entered
into
an
arrangement
with
their
custodian
whereby
credits
realized
as
a
result
of
uninvested
cash
balances
are
used
to
reduce
a
portion
of
the
Funds'
custodian
expenses.
During
the
period
ended
February
29,
2024,
there
were
no
credits
earned.
5.
Income
Taxes
For
tax
purposes,
capital
losses
may
be
carried
over
to
offset
future
capital
gains.
At
August
31,
2023,
the
capital
loss
carryforwards
were
as
follows:
Shares
Percentage
of
Outstanding
Shares
a
Franklin
Templeton
SMACS:
Series
CH
Franklin
Resources,
Inc.
303,978
11.3%
Franklin
Templeton
SMACS:
Series
H
Franklin
Resources,
Inc.
301,587
20.6%
a
Investment
activities
of
significant
shareholders
could
have
a
material
impact
on
the
Fund.
Franklin
Templeton
SMACS:
Series
CH
Franklin
Templeton
SMACS:
Series
H
Purchases
..............................
$9,610,717
$1,955,000
Sales
..................................
$3,400,000
$2,255,000
Net
Realized
Gains
(Losses)
.................
$-
$-
Franklin
Templeton
SMACS:
Series
CH
Franklin
Templeton
SMACS:
Series
H
Franklin
Templeton
SMACS:
Series
I
1
1
1
1
Capital
loss
carryforwards
not
subject
to
expiration:
Short
term
.............................
$
20,114
$
21,877
$
1,587,297
Long
term
.............................
187,126
58,696
367,795
Total
capital
loss
carryforwards
............
$207,240
$80,573
a
$1,955,092
b
a
Includes
$65,341
which
may
be
carried
over
to
offset
future
capital
gains,
subject
to
certain
limitations
.
b
Includes
$331,722
which
may
be
carried
over
to
offset
future
capital
gains,
subject
to
certain
limitations
.
3.
Transactions
with
Affiliates
(continued)
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
39
franklintempleton.com
Semiannual
Report
For
tax
purposes,
the
Funds
may
elect
to
defer
any
portion
of
a
post-October
capital
loss
or
late-year
ordinary
loss
to
the
first
day
of
the
following
fiscal
year.
At
August
31,
2023,
Franklin
Templeton
SMACS:
Series
E
deferred
post-October
capital
losses
of
$269,838.
At
February
29,
2024,
the
cost
of
investments
and
net
unrealized
appreciation
(depreciation)
for
income
tax
purposes
were
as
follows:
Differences
between
income
and/or
capital
gains
as
determined
on
a
book
basis
and
a
tax
basis
are
primarily
due
to
differing
treatments
of
defaulted
securities,
wash
sales,
derivative
financial
instruments,
equity-linked
securities,
contingent
securities
and
convertible
securities.
6.
Investment
Transactions
Purchases
and
sales
of
investments
and
ETFs
(excluding
short
term
securities)
for
the
period
ended
February
29,
2024,
were
as
follows:
7.
Credit Risk
and
Defaulted
Securities
At
February
29,
2024, certain
or
all
Funds had a
portion of their
portfolio
invested
in
high
yield
or
other
securities
rated
below
investment
grade
as
determined
by
Nationally
Recognized
Statistical
Credit
Ratings
Organizations
and/or
internally,
by
investment
management
and
unrated
securities.
These
securities
may
be
more
sensitive
to
economic
conditions
causing
greater
price
volatility
and
are
potentially
subject
to
a
greater
risk
of
loss
due
to
default
than
higher
rated
securities.
Franklin
Templeton
SMACS:
Series
CH
Franklin
Templeton
SMACS:
Series
E
Franklin
Templeton
SMACS:
Series
H
Franklin
Templeton
SMACS:
Series
I
a
a
a
a
a
Cost
of
investments
.......................
$22,257,239
$132,033,003
$13,136,421
$236,873,134
Unrealized
appreciation
.....................
$870,568
$7,523,912
$418,565
$5,754,369
Unrealized
depreciation
.....................
(166,801)
(3,383,664)
(176,753)
(2,812,835)
Net
unrealized
appreciation
(depreciation)
.......
$703,767
$4,140,248
$241,812
$2,941,534
Franklin
Templeton
SMACS:
Series
CH
Franklin
Templeton
SMACS:
Series
E
Franklin
Templeton
SMACS:
Series
H
Franklin
Templeton
SMACS:
Series
I
Purchases
..............................
$23,191,646
$116,465,506
$4,941,296
$139,198,519
Sales
..................................
$4,892,995
$47,169,304
$900,390
$12,231,777
Franklin
Templeton
SMACS:
Series
CH
Franklin
Templeton
SMACS:
Series
H
Franklin
Templeton
SMACS:
Series
I
Credit
risk
.....................................
50.7%
47.3%
70.1%
5.
Income
Taxes
(continued)
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
40
franklintempleton.com
Semiannual
Report
Certain
or
all
Funds held
defaulted
securities
and/or
other
securities
for
which
the
income
has
been
deemed
uncollectible.
At
February
29,
2024,
the
aggregate
value
of
these
securities
for Franklin
Templeton
SMACS:
Series
CH
and
Franklin
Templeton
SMACS:
Series
I was less
than
0.1%,
respectively,
of
each
Fund's
net
assets.
The
Funds
discontinue
accruing
income
on
securities
for
which
income
has
been
deemed
uncollectible
and
provide
an
estimate
for
losses
on
interest
receivable.
The
securities
have
been
identified
in
the
accompanying
Schedules
of
Investments.
8.
Concentration
of
Risk
Franklin
Templeton
SMACS:
Series
CH
invests
a
large
percentage
of
its total
assets
in
obligations
of
issuers
within California
and
U.S.
territories.
Such
concentration
may
subject
the
Fund
to
risks
associated
with
industrial
or
regional
matters,
and
economic,
political
or
legal
developments
occurring
within California
and
U.S.
territories. Investments
in
these
securities
are
sensitive
to
interest
rate
changes
and
credit
risk
of
the
issuer
and
may
subject
the
Fund
to
increased
market
volatility.
The
market
for
these
investments
may
be
limited,
which
may
make
them
difficult
to
buy
or
sell.
9.
Other
Derivative
Information
At
February
29,
2024,
investments
in
derivative
contracts
are
reflected
in
the
Statements
of
Assets
and
Liabilities
as
follows:
a
This
amount
reflects
the
cumulative
appreciation
(depreciation)
of
futures
contracts
as
reported
in
the
Schedule
of
Investments.
Only
the
variation
m
argin
receivable/payable
at
period
end
is
separately
reported
within
the
Statements
of
Assets
and
Liabilities.
Prior
variation
margin
movements
were
recorded
to
cash
upon
receipt
or
payment.
Asset
Derivatives
Liability
Derivatives
Derivative
Contracts
Not
Accounted
for
as
Hedging
Instruments
Statement
of
Assets
and
Liabilities
Location
Fair
Value
Statement
of
Assets
and
Liabilities
Location
Fair
Value
Franklin
Templeton
SMACS:
Series
I
Interest
rate
contracts
.......
Variation
margin
on
futures
contracts
$
141,415
a
Variation
margin
on
futures
contracts
$
-
Total
....................
$141,415
$-
7.
Credit Risk
and
Defaulted
Securities
(continued)
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
41
franklintempleton.com
Semiannual
Report
For
the
period
ended
February
29,
2024,
the
effect
of
derivative
contracts
in
the
Statements
of
Operations
was
as
follows:
For
the
period
ended
February
29,
2024,
the
average
month
end
notional
amount
of
futures
contracts
and
options
were
as
follows:
See
Note
1(c)
regarding
derivative
financial
instruments.
10.
Credit
Facility
The
Funds,
together
with
other
U.S.
registered
and
foreign
investment
funds
(collectively,
Borrowers),
managed
by
Franklin
Templeton,
are
borrowers
in
a
joint
syndicated
senior
unsecured
credit
facility
totaling
$2.675
billion
(Global
Credit
Facility)
which
matures
on
January
31,
2025.
This
Global
Credit
Facility
provides
a
source
of
funds
to
the
Borrowers
for
temporary
and
emergency
purposes,
including
the
ability
to
meet
future
unanticipated
or
unusually
large
redemption
requests.
Under
the
terms
of
the
Global
Credit
Facility,
the
Funds
shall,
in
addition
to
interest
charged
on
any
borrowings
made
by
the
Funds
and
other
costs
incurred
by
the
Funds,
pay
their
share
of
fees
and
expenses
incurred
in
connection
with
the
implementation
and
maintenance
of
the
Global
Credit
Facility,
based
upon
their
relative
share
of
the
aggregate
net
assets
of
all
of
the
Borrowers,
including
an
annual
commitment
fee
of
0.15%
based
upon
the
unused
portion
of
the
Global
Credit
Facility.
These
fees
are
reflected
in
other
expenses
in
the
Statements
of
Operations.
During
the
period ended
February
29,
2024,
the
Funds
did
not
use
the
Global
Credit
Facility.
Derivative
Contracts
Not
Accounted
for
as
Hedging
Instruments
Statement
of
Operations
Location
Net
Realized
Gain
(Loss)
for
the
Period
Statement
of
Operations
Location
Net
Change
in
Unrealized
Appreciation
(Depreciation)
for
the
Period
Franklin
Templeton
SMACS:
Series
E
Net
realized
gain
(loss)
from:
Net
change
in
unrealized
appreciation
(depreciation)
on:
Equity
Contracts
..............
Written
options
$46,100
Written
options
$4,033
Total
.......................
$46,100
$4,033
Franklin
Templeton
SMACS:
Series
I
Net
realized
gain
(loss)
from:
Net
change
in
unrealized
appreciation
(depreciation)
on:
Interest
rate
contracts
..........
Futures
contracts
14,996
Futures
contracts
(172,586)
Total
.......................
$14,996
$(172,586)
Franklin
Templeton
SMACS:
Series
E
Franklin
Templeton
SMACS:
Series
I
Futures
contracts
.........................
$-
$24,614,580
Options
.................................
70,929
-
9.
Other
Derivative
Information
(continued)
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
42
franklintempleton.com
Semiannual
Report
11.
Fair
Value
Measurements
The Funds
follow
a
fair
value
hierarchy
that
distinguishes
between
market
data
obtained
from
independent
sources
(observable
inputs)
and
the Funds'
own
market
assumptions
(unobservable
inputs).
These
inputs
are
used
in
determining
the
value
of
the Funds' financial
instruments
and
are
summarized
in
the
following
fair
value
hierarchy:
Level
1
-
quoted
prices
in
active
markets
for
identical
financial
instruments
Level
2
-
other
significant
observable
inputs
(including
quoted
prices
for
similar
financial
instruments,
interest
rates,
prepayment
speed,
credit
risk,
etc.)
Level
3
-
significant
unobservable
inputs
(including
the Funds'
own
assumptions
in
determining
the
fair
value
of
financial
instruments)
The
input
levels
are
not
necessarily
an
indication
of
the
risk
or
liquidity
associated
with
financial
instruments
at
that
level.
A
summary
of
inputs
used
as
of
February
29,
2024,
in
valuing
the
Funds'
assets carried
at
fair
value,
is
as
follows:
Level
1
Level
2
Level
3
Total
Franklin
Templeton
SMACS:
Series
CH
Assets:
Investments
in
Securities:
a
Municipal
Bonds
.........................
$
-
$
22,761,006
$
-
$
22,761,006
Short
Term
Investments
...................
-
200,000
-
200,000
Total
Investments
in
Securities
...........
$-
$22,961,006
$-
$22,961,006
Franklin
Templeton
SMACS:
Series
E
Assets:
Investments
in
Securities:
Common
Stocks
:
Aerospace
&
Defense
...................
1,992,640
-
-
1,992,640
Automobiles
..........................
575,400
-
-
575,400
Banks
...............................
7,321,715
-
-
7,321,715
Beverages
...........................
3,901,300
-
-
3,901,300
Building
Products
......................
1,185,400
-
-
1,185,400
Capital
Markets
........................
1,469,160
-
-
1,469,160
Chemicals
...........................
3,042,360
-
-
3,042,360
Communications
Equipment
..............
1,451,100
-
-
1,451,100
Electric
Utilities
........................
1,613,800
-
-
1,613,800
Food
Products
........................
3,638,950
-
-
3,638,950
Hotels,
Restaurants
&
Leisure
.............
1,233,700
-
-
1,233,700
Household
Products
....................
2,384,100
-
-
2,384,100
Industrial
Conglomerates
................
1,013,523
-
-
1,013,523
Machinery
............................
617,803
-
-
617,803
Metals
&
Mining
.......................
4,360,800
-
-
4,360,800
Multi-Utilities
..........................
812,625
-
-
812,625
Oil,
Gas
&
Consumable
Fuels
.............
8,211,476
-
-
8,211,476
Pharmaceuticals
.......................
9,571,350
3,399,188
-
12,970,538
Semiconductors
&
Semiconductor
Equipment
.
6,681,010
-
-
6,681,010
Software
.............................
4,132,160
-
-
4,132,160
Specialty
Retail
........................
1,903,050
-
-
1,903,050
Tobacco
.............................
3,148,600
-
-
3,148,600
Equity-Linked
Securities
...................
-
51,777,306
-
51,777,306
Convertible
Preferred
Stocks
................
1,752,000
-
-
1,752,000
Corporate
Bonds
........................
-
6,607,447
-
6,607,447
Short
Term
Investments
...................
2,375,288
-
-
2,375,288
Total
Investments
in
Securities
...........
$74,389,310
$61,783,941
b
$-
$136,173,251
Franklin
Strategic
Series
Notes
to
Financial
Statements
(unaudited)
43
franklintempleton.com
Semiannual
Report
12.
Subsequent
Events
The
Funds
have
evaluated
subsequent
events
through
the
issuance
of
the
financial
statements
and
determined
that
no
events
have
occurred
that
require
disclosure.
Abbreviations
Level
1
Level
2
Level
3
Total
Franklin
Templeton
SMACS:
Series
H
Assets:
Investments
in
Securities:
a
Management
Investment
Companies
.........
$1,217,500
$-
$-
$1,217,500
Municipal
Bonds
.........................
-
12,160,733
-
12,160,733
Total
Investments
in
Securities
...........
$1,217,500
$12,160,733
$-
$13,378,233
Franklin
Templeton
SMACS:
Series
I
Assets:
Investments
in
Securities:
a
Common
Stocks
.........................
1,553,400
-
-
1,553,400
Equity-Linked
Securities
...................
-
5,962,303
-
5,962,303
Corporate
Bonds
........................
-
228,899,592
-
228,899,592
Short
Term
Investments
...................
3,257,958
-
-
3,257,958
Total
Investments
in
Securities
...........
$4,811,358
$234,861,895
$-
$239,673,253
Other
Financial
Instruments:
Futures
contracts
........................
$141,415
$-
$-
$141,415
Total
Other
Financial
Instruments
.........
$141,415
$-
$-
$141,415
a
For
detailed
categories,
see
the
accompanying
Schedule
of
Investments.
b
Includes
foreign
securities
valued
at
$3,399,188,
which
were
categorized
as
Level
2
as
a
result
of
the
application
of
market
level
fair
value
procedures.
See
the
Financial
Instrument
Valuation
note
for
more
information.
Selected
Portfolio
ADR
American
Depositary
Receipt
ETF
Exchange-Traded
Fund
FRN
Floating
Rate
Note
GO
General
Obligation
LOC
Letter
of
Credit
REIT
Real
Estate
Investment
Trust
SOFR
Secured
Overnight
Financing
Rate
11.
Fair
Value
Measurements
(continued)
Franklin
Strategic
Series
Shareholder
Information
44
franklintempleton.com
Semiannual
Report
Proxy
Voting
Policies
and
Procedures
The
Trust's
investment
manager
has
established
Proxy
Voting
Policies
and
Procedures
(Policies)
that
the
Trust
uses
to
determine
how
to
vote
proxies
relating
to
portfolio
securities.
Shareholders
may
view
the
Trust's
complete
Policies
online
at
franklintempleton.com.
Alternatively,
shareholders
may
request
copies
of
the
Policies
free
of
charge
by
calling
the
Proxy
Group
collect
at
(954)
527-
7678
or
by
sending
a
written
request
to:
Franklin
Templeton
Companies,
LLC,
300
S.E.
2nd
Street,
Fort
Lauderdale,
FL
33301,
Attention:
Proxy
Group.
Copies
of
the
Trust's
proxy
voting
records
are
also
made
available
online
at
franklintempleton.com
and
posted
on
the
U.S.
Securities
and
Exchange
Commission's
website
at
sec.gov
and
reflect
the
most
recent
12-month
period
ended
June
30.
Quarterly
Schedule
of
Investments
The
Trust
files
a
complete
schedule
of
investments
with
the
U.S.
Securities
and
Exchange
Commission
for
the
first
and
third
quarters
for
each
fiscal
year
as
an
exhibit
to
its
report
on
Form
N-PORT.
Shareholders
may
view
the
filed
Form
N-PORT
by
visiting
the
Commission's
website
at
sec.
gov.
The
filed
form
may
also
be
viewed
and
copied
at
the
Commission's
Public
Reference
Room
in
Washington,
DC.
Information
regarding
the
operations
of
the
Public
Reference
Room
may
be
obtained
by
calling
(800)
SEC-0330.
Householding
of
Reports
and
Prospectuses
You
will
receive,
or
receive
notice
of
the
availability
of,
each
Fund's
financial
reports
every
six
months.
In
addition,
you
will
receive
an
annual
updated
summary
prospectus
(detail
prospectus
available
upon
request).
To
reduce
Fund
expenses,
we
try
to
identify
related
shareholders
in
a
household
and
send
only
one
copy
of
the
financial
reports
(to
the
extent
received
by
mail)
and
summary
prospectus.
This
process,
called
"householding,"
will
continue
indefinitely
unless
you
instruct
us
otherwise.
If
you
prefer
not
to
have
these
documents
householded,
please
call
us
at
(800)
632-2301.
At
any
time
you
may
view
current
prospectuses/
summary
prospectuses
and
financial
reports
on
our
website.
If
you
choose,
you
may
receive
these
documents
through
electronic
delivery.
Item 2. Code of Ethics.
(a) The Registrant has adopted a code of ethics that applies to its principal executive officers and principal financial and accounting officer.
(c) N/A
(d) N/A
(f) Pursuant to Item 13(a)(1), the Registrant is attaching as an exhibit a copy of its code of ethics that applies to its principal executive officers and principal financial and accounting officer.


Item 3. Audit Committee Financial Expert.
(a)(1) The Registrant has an audit committee financial expert serving on its audit committee.
(2) The audit committee financial expert is Mary C. Choksi and she is "independent" as defined under the relevant Securities and Exchange Commission Rules and Releases.


Item 4.
Principal Accountant Fees and Services.
N/A
Item 5. Audit Committee
of Listed Registrants. N/A
Item 6. Schedule of Investments. N/A
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. N/A
Item 8. Portfolio Managers of Closed-End Management Investment Companies. N/A
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and
Affiliated Purchasers. N/A
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no changes to the procedures by which shareholders may recommend nominees to the Registrant's Board of Trustees that would require disclosure herein.
Item 11. Controls and Procedures.
(a)
Evaluation of Disclosure Controls and Procedures
.
The Registrant maintains disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the Registrant's filings under the Securities Exchange Act of 1934, as amended, and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission. Such information is accumulated and communicated to the Registrant's management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Registrant's management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Within 90 days prior to the filing date of this Shareholder Report on Form N-CSR, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant's management, including the Registrant's principal executive officer and the Registrant's principal financial officer, of the effectiveness of the design and operation of the Registrant's disclosure controls and procedures. Based on such evaluation, the Registrant's principal executive officer and principal financial officer concluded that the Registrant's disclosure controls and procedures are effective.
(b)
Changes in Internal Controls. There have been no changes in the Registrant's internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect the internal control over financial reporting.
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Company. N/A


Item 13. Recovery of Erroneously Awarded Compensation.
(a) N/A


(b) N/A
Item 14. Exhibits.
(a)(1) Code of Ethics
codeofethics
(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Christopher Kings, Chief Executive Officer - Finance and Administration, and Jeffrey White, Chief Financial Officer, Chief Accounting Officer and Treasurer
section302
(a)(2)(1) There were no written solicitations to purchase securities under Rule 23c-1 under the Act sent or given during the period covered by the report by or on behalf of the Registrant to 10 or more persons.
(a)(2)(2) There was no change in the Registrant's independent public accountant during the period covered by the report.
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Christopher Kings, Chief Executive Officer - Finance and Administration, and Jeffrey White, Chief Financial Officer, Chief Accounting Officer and Treasurer
section906
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
FRANKLIN STRATEGIC SERIES
By S\CHRISTOPHER KINGS _________________
Christopher Kings
Chief Executive Officer - Finance and Administration
Date April 29, 2024


Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By S\CHRISTOPHER KINGS _________________
Christopher Kings
Chief Executive Officer - Finance and Administration
Date April 29, 2024
By S\JEFFREY WHITE______________________
Jeffrey White
Chief Financial Officer, Chief Accounting Officer and Treasurer
Date April 29, 2024