Franklin Federal Tax-Free Income Fund
Franklin Federal Tax Free Income Fund · 5 share classes
Fund classification
Classified from what the fund holds · as of 2026 Q2
Franklin Federal Tax-Free Income Fund is an actively managed U.S. bond fund.
- Asset class
- Bonds
- Region
- United States
- Management
- Actively managed
- Fund type
- Open-end fund
- Credit quality
- Mixed credit
- Rate sensitivity
- Long duration
Fund profile
As filed in the prospectus · 2025 Q3
To provide investors with as high a level of income exempt from federal income taxes as is consistent with prudent investment management and the preservation of shareholders capital.
The fund invests at least 80% of assets in investment-grade municipal securities whose interest is exempt from federal income taxes, selecting securities rated in the top four categories by nationally recognized rating services based on credit quality, risk, structure, and pricing to balance income and capital preservation. Up to 20% of assets may be held in securities subject to federal alternative minimum tax or taxable interest. Because security selection depends on the manager's assessment of individual credit profiles and market conditions, the fund's composition and returns will differ from any broad municipal index.
| Share class | Expense ratio |
|---|---|
| FKTIX | 0.62% |
| FRFTX | 1.17% |
| FAFTX | 0.52% |
| FFTQX | 0.48% |
| FFQAX | 0.77% |
Portfolio turnover 9.61% · as of 2025 Q3
Allocation
Asset groups · long / short shown separately, never netted · 2026 Q2
| Bonds | 98.73% |
| Cash & short-term | 0.64% |
Latest quarter
What changed since the fund's previous filing
Largest new: Texas Municipal Gas Acquisition & Supply Corp. V, California Community Choice Financing Authority, Pennsylvania Economic Development Financing Authority, University of California, Multnomah County School District No. 1J Portland, Illinois Finance Authority, State of Illinois, New York Transportation Development Corp.
Largest exited: Harris County Cultural Education Facilities Finance Corp., District of Columbia, Philadelphia Authority for Industrial Development, Maryland Health & Higher Educational Facilities Authority, New Hampshire Health and Education Facilities Authority Act, Oregon City School District No. 62, Omaha Public Power District Nebraska City Station Unit 2, New York State Thruway Authority
Return profile
Total return as filed — price change plus distributions reinvested · trailing figures to Apr 2026
| Share class | 1-year | 3-year | 5-year | Vol | Worst fall |
|---|---|---|---|---|---|
| +6.39% | +12.24% | +3.78% | 4.80% | -6.27% | |
| +5.82% | +10.42% | +0.97% | 4.71% | -6.40% | |
| +6.59% | +12.67% | +4.39% | 4.71% | -6.24% | |
| +6.55% | +12.72% | +4.53% | 4.81% | -6.32% | |
| +6.24% | +11.74% | +3.01% | 4.73% | -6.39% |
These classes hold the same portfolio, so the 3.56pp spread over 5 years is the cost difference between them — roughly 0.71pp a year — not a difference in what they own.
Debt profile
What this fund holds — value-weighted across its bond and securitized long positions · as of 2026-04-30
Share of the fund's debt by how its coupon behaves — the fact that decides whether a rate move reaches this portfolio at all.
| Fixed rate | 86.2% |
| Zero-coupon or unclassified | 8.1% |
| Floating rate | 5.7% |
Share of the fund's debt value in each maturity band, shortest first.
| <1y | 0.3% |
| 1-3y | 1.6% |
| 3-5y | 1.1% |
| 5-10y | 7.3% |
| 10y+ | 89.7% |
These three overlap — one holding can be in arrears and paying in kind at once — so they are shown separately and never summed.
Risk profile
Interest-rate and credit-spread sensitivity, both in years · as of 2026Q2
Most of this fund’s sensitivity is to interest rates, with credit spreads carrying nearly as much.
Where the loss would come from. The two shocks are the same size, so this is the balance of the fund's two sensitivities rather than a bet on one moving more.
| Interest rates | 51% |
| Credit spreads | 49% |
Filers report the impact of a 0.01% move only, so the total is our own scaling of that one number and overstates the loss on most bonds — read it as approximate, never as precise. The two sensitivities overlap rather than add up: they measure the same positions against different shocks, which is why the durations above are shown side by side and never summed.
Share of the fund's spread duration carried by each credit tier.
| Investment grade | +5.68 yr |
| High yield | +1.72 yr |
Share of duration at each point, shortest first. A positive figure loses value when spreads widen; a negative one offsets — a credit hedge.
| 3 mo | 0.00 yr | 0% |
| 1 yr | 0.02 yr | 0% |
| 5 yr | 0.19 yr | 3% |
| 10 yr | 2.88 yr | 38% |
| 30 yr | 4.49 yr | 59% |
| 3 mo | 0.00 yr | 0% |
| 1 yr | 0.02 yr | 0% |
| 5 yr | 0.19 yr | 3% |
| 10 yr | 2.81 yr | 38% |
| 30 yr | 4.38 yr | 59% |
The two bands measure the same positions against different shocks and do not add — a Treasury carries rate duration and no spread duration, a floating-rate credit the reverse. Rate tenors are also summed across every currency the fund discloses.
Show the numbers
| Tenor | Rate yrs | IG yrs | HY yrs | IG $/bp | HY $/bp |
|---|---|---|---|---|---|
| 3 mo | +0.00 | +0.00 | +0.00 | $439 | $202 |
| 1 yr | +0.02 | +0.02 | +0.01 | $13.1k | $5.4k |
| 5 yr | +0.19 | +0.17 | +0.03 | $127.9k | $21.2k |
| 10 yr | +2.88 | +2.14 | +0.67 | $1.65m | $519.6k |
| 30 yr | +4.49 | +3.36 | +1.01 | $2.60m | $783.0k |
Dollar change per 1bp of spread movement, as filed and sign-anchored. A blank cell was not filed; a zero was.
Holdings
By % of NAV · equity positions carry filed share counts · every resolvable issuer links to its company page
| Ticker | Issuer | %NAV | Value | Shares |
|---|---|---|---|---|
| — | Public Finance Authority0.00% · due 2045-12-01 | 1.19% | $92.26M | — |
| — | Public Finance Authority0.00% · due 2044-12-01 | 1.05% | $81.01M | — |
| — | New York State Dormitory Authority5.00% · due 2045-03-15 | 0.80% | $62.05M | — |
| — | Tennergy Corp.5.50% floating · due 2053-10-01 | 0.76% | $58.47M | — |
| — | San Mateo Foster City School District0.00% · due 2042-08-01 | 0.73% | $56.61M | — |
| — | Louisiana Public Facilities Authority5.50% · due 2059-09-01 | 0.66% | $51.36M | — |
| — | Capital Trust Authority0.00% · due 2029-03-01 | 0.61% | $47.17M | — |
| — | Metropolitan Transportation Authority5.00% · due 2045-11-15 | 0.61% | $47.11M | — |
| — | New York Liberty Development Corp.5.25% · due 2035-10-01 | 0.59% | $45.81M | — |
| — | California Community Choice Financing Authority5.25% floating · due 2054-01-01 | 0.59% | $45.78M | — |
Top 10 positions are 7.59% of net assets, top 25 14.67%, across 450 issuers.
See more of this fund's book
More positions with filed share counts, and the quarter-over-quarter change list rather than the largest few — free with an account, no card required.
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