Franklin K2 Alternative Strategies Fund (FABZX) N-CSR Certified annual shareholder report (management investment company)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number number 

  811-22641

Franklin Alternative Strategies Funds

(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:   5/31 

Date of reporting period:   5/31/24

ITEM 1. REPORT TO STOCKHOLDERS.

The Annual Report to Stockholders is filed herewith.

K2 Alternative Strategies Fund
Class A [FAAAX]
Annual Shareholder Report | May 31, 2024

This annual shareholder report contains important information about K2 Alternative Strategies Fund for the period June 1, 2023, to May 31, 2024.
You can find additional information about the Fund at https://www.franklintempleton.com/regulatory-fund-documents. You can also request this information by contacting us at (800) DIAL BEN/342-5236.

This report describes changes to the Fund that occurred during the reporting period.

WHAT WERE THE FUND COSTS FOR THE LAST YEAR? (based on a hypothetical $10,000 investment)

Class Name	Costs of $10,000 investment	Costs paid as a percentage of a $10,000 investment*
Class A	$269	2.57%

* Reflects fee waivers and/or expense reimbursements, without which expenses would have been higher.

HOW DID THE FUND PERFORM LAST YEAR AND WHAT AFFECTED ITS PERFORMANCE?

For the twelve months ended May 31, 2024, Class A shares of K2 Alternatives Strategies Fund returned 9.57%. The Fund compares its performance to the HFRX Global Hedge Fund Index and the ICE BofA U.S. 3-Month Treasury Bill Index, which returned 5.89% and 5.45%, respectively, for the same period.

PERFORMANCE HIGHLIGHTS

Top contributors to performance:
↑	At the asset class level, long positioning in equities drove gains, led by the industrials, utilities and health care sectors. Long fixed income positioning and currency hedges also aided performance, led by emerging market sovereign bonds and short positioning against the Swiss franc.
↑	Long short equity was the largest strategy contributor, with gains driven by long equity positioning in the industrials, utilities and health care sectors.
↑	Long short equity sub-advisor Electron Capital Partners was the leading contributor, driven by long positioning in the industrials sector, especially the capital goods industry, and in utilities.

Top detractors from performance:
↓	Among asset classes, commodity positioning weighed the most on returns, due to short positions in agricultural and metal commodities held by sub-advisor Capital Fund Management (CFM). Credit positioning also detracted, due to credit default swaps by RBC Global Asset Management (UK) (formerly, BlueBay Asset Management) in emerging market sovereign bonds.
↓	The Strategic Overlay strategy, activated at the end of the first quarter of 2024, was a modest detractor as its long exposure to S&P 500® Index futures weighed slightly on returns.
↓	Three of the sub-advisors modestly detracted. One River Asset Management, a relative value sub-advisor (exited in March 2024) weighed the most on returns.

Use of derivatives and the impact on performance:

Derivatives make up a significant portion of the Fund’s holdings across multiple asset classes and security types. During the period, derivatives were an overall contributor to performance, as gains from equity total return swaps, equity index futures and interest rate contracts outweighed losses from credit default swaps, commodity futures and foreign exchange forward contracts.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 1	068-ATSR-0724

HOW DID THE FUND PERFORM OVER THE LAST 10 YEARS?

The Fund’s past performance is not necessarily an indication of how the Fund will perform in the future. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares.

VALUE OF A $10,000 INVESTMENT ($9,450 AFTER MAXIMUM APPLICABLE SALES CHARGE) –
Class A 5/31/2014 — 5/31/2024

AVERAGE ANNUAL TOTAL RETURNS (%) Period Ended May 31, 2024

	1 Year	5 Year	10 Year
Class A (without sales charge)	9.57	2.55	2.51
Class A (with sales charge)	3.56	1.39	1.93
MSCI All Country World Index-NR	23.56	11.67	8.40
HFRX Global Hedge Fund Index	5.89	3.46	1.59
ICE BofA U.S. 3-Month Treasury Bill Index	5.45	2.12	1.47

Fund performance figures may reflect fee waivers and/or expense reimbursements, without which the performance would have been lower.

Performance for periods prior to September 10, 2018 has been restated to reflect the current maximum sales charge, which is lower than the maximum sales charge prior to that date.

For current month-end performance, please call Franklin Templeton at (800) DIAL BEN/342-5236 or visit https://www.franklintempleton.com/investments/options/mutual-funds.  

Important data provider notices and terms available at   www.franklintempletondatasources.com.

KEY FUND STATISTICS (as of May 31, 2024)

Total Net Assets	$634,669,943
Total Number of Portfolio Holdings*	721
Total Management Fee Paid	$11,431,760
Portfolio Turnover Rate	257.70%

* Does not include derivatives, except purchased option contracts, if any.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 2	068-ATSR-0724

WHAT DID THE FUND INVEST IN?  (as of May 31, 2024)

Strategy Allocation (% of Total Net Assets)

	Long Positions	Short Positions
Long Short Equity	43.2	-32.4
Relative Value	51.6	-26.1
Event Driven	2.3	-2.0
Global Macro	95.0	-136.3
Strategic Overlay	3.0	--
Total	195.1	-196.8

Figures include the effect of gross notional exposure of derivatives.

HOW HAS THE FUND CHANGED?

In October 2023, the Fund revised its investment strategies to reflect that the Fund’s investment manager may directly manage a portion of the Fund’s assets in one or more of the Fund’s alternative investment strategies. In March 2024, the Fund further revised its investment strategies to reflect that the Fund’s investment manager: (i) may directly manage up to a substantial portion of the Fund’s assets in one or more of the Fund’s alternative investment strategies; and (ii) manages a small portion of the Fund’s assets according to its strategic overlay strategy, which uses derivatives and other instruments to adjust the Fund’s net exposure to markets, asset classes and sectors. The investment manager of the Fund, however, still allocates a substantial portion (or, at times, up to all) of the Fund’s assets to affiliated and unaffiliated sub-advisors to implement the Fund’s alternative investment strategies.

Effective as of June 3, 2024, the Fund’s named portfolio management team consists of Lillian C. Night, Art Vinokur, Brooks Ritchey, Robert Christian and Anthony Zanolla. It is anticipated that Mr. Ritchey will retire and step down as a member of the Fund’s portfolio management team on or about September 30, 2024.

Effective July 1, 2023, the Fund’s contractual fee and expense cap on operating expenses was reduced from 1.95% to 1.90% (excluding Rule 12b-1 fees, acquired fund fees and expenses, expenses related to securities sold short and certain non-routine expenses or costs). Effective March 1, 2024, this contractual fee and expense cap on operating expenses was further reduced to 1.70% through September 30, 2025.

In addition, effective on March 1, 2024, the Fund’s contractual management fee schedule was reduced by 0.20% for each breakpoint.

This is a summary of certain changes to the Fund since June 1, 2023. For more complete information, you may review the Fund’s current prospectus and any applicable supplements at https://www.franklintempleton.com/regulatory-fund-documents  or upon request at (800) DIAL BEN/342-5236 or prospectus@franklintempleton.com.

	WHERE CAN I FIND ADDITIONAL INFORMATION ABOUT THE FUND?
	Additional information is available on https://www.franklintempleton.com/regulatory-fund-documents, including its:
	• prospectus • proxy voting information • financial information • holdings • tax information

HOUSEHOLDING

You will receive the Fund’s shareholder 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 shareholder reports 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) DIAL BEN/342-5236. At any time you may view current prospectuses/summary prospectuses and shareholder reports on our website. If you choose, you may receive these documents through electronic delivery.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 3	068-ATSR-0724

945099739585101671053010672106561196111214110471210410000105089938116811306312894135941928317975181282239810000101119404996710255987710168115451119611055117061000010003100181006210191104211061310624106401097411573

K2 Alternative Strategies Fund
Class C [FASCX]
Annual Shareholder Report | May 31, 2024

This annual shareholder report contains important information about K2 Alternative Strategies Fund for the period June 1, 2023, to May 31, 2024.
You can find additional information about the Fund at https://www.franklintempleton.com/regulatory-fund-documents. You can also request this information by contacting us at (800) DIAL BEN/342-5236.

This report describes changes to the Fund that occurred during the reporting period.

WHAT WERE THE FUND COSTS FOR THE LAST YEAR? (based on a hypothetical $10,000 investment)

Class Name	Costs of $10,000 investment	Costs paid as a percentage of a $10,000 investment*
Class C	$347	3.33%

* Reflects fee waivers and/or expense reimbursements, without which expenses would have been higher.

HOW DID THE FUND PERFORM LAST YEAR AND WHAT AFFECTED ITS PERFORMANCE?

For the twelve months ended May 31, 2024, Class C shares of K2 Alternatives Strategies Fund returned 8.69%. The Fund compares its performance to the HFRX Global Hedge Fund Index and the ICE BofA U.S. 3-Month Treasury Bill Index, which returned 5.89% and 5.45%, respectively, for the same period.

PERFORMANCE HIGHLIGHTS

Top contributors to performance:
↑	At the asset class level, long positioning in equities drove gains, led by the industrials, utilities and health care sectors. Long fixed income positioning and currency hedges also aided performance, led by emerging market sovereign bonds and short positioning against the Swiss franc.
↑	Long short equity was the largest strategy contributor, with gains driven by long equity positioning in the industrials, utilities and health care sectors.
↑	Long short equity sub-advisor Electron Capital Partners was the leading contributor, driven by long positioning in the industrials sector, especially the capital goods industry, and in utilities.

Top detractors from performance:
↓	Among asset classes, commodity positioning weighed the most on returns, due to short positions in agricultural and metal commodities held by sub-advisor Capital Fund Management (CFM). Credit positioning also detracted, due to credit default swaps by RBC Global Asset Management (UK) (formerly, BlueBay Asset Management) in emerging market sovereign bonds.
↓	The Strategic Overlay strategy, activated at the end of the first quarter of 2024, was a modest detractor as its long exposure to S&P 500® Index futures weighed slightly on returns.
↓	Three of the sub-advisors modestly detracted. One River Asset Management, a relative value sub-advisor (exited in March 2024) weighed the most on returns.

Use of derivatives and the impact on performance:

Derivatives make up a significant portion of the Fund’s holdings across multiple asset classes and security types. During the period, derivatives were an overall contributor to performance, as gains from equity total return swaps, equity index futures and interest rate contracts outweighed losses from credit default swaps, commodity futures and foreign exchange forward contracts.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 1	520-ATSR-0724

HOW DID THE FUND PERFORM OVER THE LAST 10 YEARS?

The Fund’s past performance is not necessarily an indication of how the Fund will perform in the future. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares.

VALUE OF A $10,000 INVESTMENT – Class C 5/31/2014 — 5/31/2024

AVERAGE ANNUAL TOTAL RETURNS (%) Period Ended May 31, 2024

	1 Year	5 Year	10 Year
Class C (without sales charge)	8.69	1.79	1.75
Class C (with sales charge)	7.69	1.79	1.75
MSCI All Country World Index-NR	23.56	11.67	8.40
HFRX Global Hedge Fund Index	5.89	3.46	1.59
ICE BofA U.S. 3-Month Treasury Bill Index	5.45	2.12	1.47

Fund performance figures may reflect fee waivers and/or expense reimbursements, without which the performance would have been lower.

For current month-end performance, please call Franklin Templeton at (800) DIAL BEN/342-5236 or visit https://www.franklintempleton.com/investments/options/mutual-funds.  

Important data provider notices and terms available at   www.franklintempletondatasources.com.

KEY FUND STATISTICS (as of May 31, 2024)

Total Net Assets	$634,669,943
Total Number of Portfolio Holdings*	721
Total Management Fee Paid	$11,431,760
Portfolio Turnover Rate	257.70%

* Does not include derivatives, except purchased option contracts, if any.

WHAT DID THE FUND INVEST IN?  (as of May 31, 2024)

Strategy Allocation (% of Total Net Assets)

	Long Positions	Short Positions
Long Short Equity	43.2	-32.4
Relative Value	51.6	-26.1
Event Driven	2.3	-2.0
Global Macro	95.0	-136.3
Strategic Overlay	3.0	--
Total	195.1	-196.8

Figures include the effect of gross notional exposure of derivatives.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 2	520-ATSR-0724

HOW HAS THE FUND CHANGED?

In October 2023, the Fund revised its investment strategies to reflect that the Fund’s investment manager may directly manage a portion of the Fund’s assets in one or more of the Fund’s alternative investment strategies. In March 2024, the Fund further revised its investment strategies to reflect that the Fund’s investment manager: (i) may directly manage up to a substantial portion of the Fund’s assets in one or more of the Fund’s alternative investment strategies; and (ii) manages a small portion of the Fund’s assets according to its strategic overlay strategy, which uses derivatives and other instruments to adjust the Fund’s net exposure to markets, asset classes and sectors. The investment manager of the Fund, however, still allocates a substantial portion (or, at times, up to all) of the Fund’s assets to affiliated and unaffiliated sub-advisors to implement the Fund’s alternative investment strategies.

Effective as of June 3, 2024, the Fund’s named portfolio management team consists of Lillian C. Night, Art Vinokur, Brooks Ritchey, Robert Christian and Anthony Zanolla. It is anticipated that Mr. Ritchey will retire and step down as a member of the Fund’s portfolio management team on or about September 30, 2024.

Effective July 1, 2023, the Fund’s contractual fee and expense cap on operating expenses was reduced from 1.95% to 1.90% (excluding Rule 12b-1 fees, acquired fund fees and expenses, expenses related to securities sold short and certain non-routine expenses or costs). Effective March 1, 2024, this contractual fee and expense cap on operating expenses was further reduced to 1.70% through September 30, 2025.

In addition, effective on March 1, 2024, the Fund’s contractual management fee schedule was reduced by 0.20% for each breakpoint.

This is a summary of certain changes to the Fund since June 1, 2023. For more complete information, you may review the Fund’s current prospectus and any applicable supplements at https://www.franklintempleton.com/regulatory-fund-documents  or upon request at (800) DIAL BEN/342-5236 or prospectus@franklintempleton.com.

	WHERE CAN I FIND ADDITIONAL INFORMATION ABOUT THE FUND?
	Additional information is available on https://www.franklintempleton.com/regulatory-fund-documents, including its:
	• prospectus • proxy voting information • financial information • holdings • tax information

HOUSEHOLDING

You will receive the Fund’s shareholder 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 shareholder reports 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) DIAL BEN/342-5236. At any time you may view current prospectuses/summary prospectuses and shareholder reports on our website. If you choose, you may receive these documents through electronic delivery.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 3	520-ATSR-0724

100001048710003105301082710887107941203611186109491190010000105089938116811306312894135941928317975181282239810000101119404996710255987710168115451119611055117061000010003100181006210191104211061310624106401097411573

K2 Alternative Strategies Fund
Class R [FSKKX]
Annual Shareholder Report | May 31, 2024

This annual shareholder report contains important information about K2 Alternative Strategies Fund for the period June 1, 2023, to May 31, 2024.
You can find additional information about the Fund at https://www.franklintempleton.com/regulatory-fund-documents. You can also request this information by contacting us at (800) DIAL BEN/342-5236.

This report describes changes to the Fund that occurred during the reporting period.

WHAT WERE THE FUND COSTS FOR THE LAST YEAR? (based on a hypothetical $10,000 investment)

Class Name	Costs of $10,000 investment	Costs paid as a percentage of a $10,000 investment*
Class R	$295	2.82%

* Reflects fee waivers and/or expense reimbursements, without which expenses would have been higher.

HOW DID THE FUND PERFORM LAST YEAR AND WHAT AFFECTED ITS PERFORMANCE?

For the twelve months ended May 31, 2024, Class R shares of K2 Alternatives Strategies Fund returned 9.30%. The Fund compares its performance to the HFRX Global Hedge Fund Index and the ICE BofA U.S. 3-Month Treasury Bill Index, which returned 5.89% and 5.45%, respectively, for the same period.

PERFORMANCE HIGHLIGHTS

Top contributors to performance:
↑	At the asset class level, long positioning in equities drove gains, led by the industrials, utilities and health care sectors. Long fixed income positioning and currency hedges also aided performance, led by emerging market sovereign bonds and short positioning against the Swiss franc.
↑	Long short equity was the largest strategy contributor, with gains driven by long equity positioning in the industrials, utilities and health care sectors.
↑	Long short equity sub-advisor Electron Capital Partners was the leading contributor, driven by long positioning in the industrials sector, especially the capital goods industry, and in utilities.

Top detractors from performance:
↓	Among asset classes, commodity positioning weighed the most on returns, due to short positions in agricultural and metal commodities held by sub-advisor Capital Fund Management (CFM). Credit positioning also detracted, due to credit default swaps by RBC Global Asset Management (UK) (formerly, BlueBay Asset Management) in emerging market sovereign bonds.
↓	The Strategic Overlay strategy, activated at the end of the first quarter of 2024, was a modest detractor as its long exposure to S&P 500® Index futures weighed slightly on returns.
↓	Three of the sub-advisors modestly detracted. One River Asset Management, a relative value sub-advisor (exited in March 2024) weighed the most on returns.

Use of derivatives and the impact on performance:

Derivatives make up a significant portion of the Fund’s holdings across multiple asset classes and security types. During the period, derivatives were an overall contributor to performance, as gains from equity total return swaps, equity index futures and interest rate contracts outweighed losses from credit default swaps, commodity futures and foreign exchange forward contracts.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 1	820-ATSR-0724

HOW DID THE FUND PERFORM OVER THE LAST 10 YEARS?

The Fund’s past performance is not necessarily an indication of how the Fund will perform in the future. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares.

VALUE OF A $10,000 INVESTMENT – Class R 5/31/2014 — 5/31/2024

AVERAGE ANNUAL TOTAL RETURNS (%) Period Ended May 31, 2024

	1 Year	5 Year	10 Year
Class R (without sales charge)	9.30	2.31	2.22
Class R (with sales charge)	9.30	2.31	2.22
MSCI All Country World Index-NR	23.56	11.67	8.40
HFRX Global Hedge Fund Index	5.89	3.46	1.59
ICE BofA U.S. 3-Month Treasury Bill Index	5.45	2.12	1.47

Fund performance figures may reflect fee waivers and/or expense reimbursements, without which the performance would have been lower.

For current month-end performance, please call Franklin Templeton at (800) DIAL BEN/342-5236 or visit https://www.franklintempleton.com/investments/options/mutual-funds.  

Important data provider notices and terms available at   www.franklintempletondatasources.com.

KEY FUND STATISTICS (as of May 31, 2024)

Total Net Assets	$634,669,943
Total Number of Portfolio Holdings*	721
Total Management Fee Paid	$11,431,760
Portfolio Turnover Rate	257.70%

* Does not include derivatives, except purchased option contracts, if any.

WHAT DID THE FUND INVEST IN?  (as of May 31, 2024)

Strategy Allocation (% of Total Net Assets)

	Long Positions	Short Positions
Long Short Equity	43.2	-32.4
Relative Value	51.6	-26.1
Event Driven	2.3	-2.0
Global Macro	95.0	-136.3
Strategic Overlay	3.0	--
Total	195.1	-196.8

Figures include the effect of gross notional exposure of derivatives.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 2	820-ATSR-0724

HOW HAS THE FUND CHANGED?

In October 2023, the Fund revised its investment strategies to reflect that the Fund’s investment manager may directly manage a portion of the Fund’s assets in one or more of the Fund’s alternative investment strategies. In March 2024, the Fund further revised its investment strategies to reflect that the Fund’s investment manager: (i) may directly manage up to a substantial portion of the Fund’s assets in one or more of the Fund’s alternative investment strategies; and (ii) manages a small portion of the Fund’s assets according to its strategic overlay strategy, which uses derivatives and other instruments to adjust the Fund’s net exposure to markets, asset classes and sectors. The investment manager of the Fund, however, still allocates a substantial portion (or, at times, up to all) of the Fund’s assets to affiliated and unaffiliated sub-advisors to implement the Fund’s alternative investment strategies.

Effective as of June 3, 2024, the Fund’s named portfolio management team consists of Lillian C. Night, Art Vinokur, Brooks Ritchey, Robert Christian and Anthony Zanolla. It is anticipated that Mr. Ritchey will retire and step down as a member of the Fund’s portfolio management team on or about September 30, 2024.

Effective July 1, 2023, the Fund’s contractual fee and expense cap on operating expenses was reduced from 1.95% to 1.90% (excluding Rule 12b-1 fees, acquired fund fees and expenses, expenses related to securities sold short and certain non-routine expenses or costs). Effective March 1, 2024, this contractual fee and expense cap on operating expenses was further reduced to 1.70% through September 30, 2025.

In addition, effective on March 1, 2024, the Fund’s contractual management fee schedule was reduced by 0.20% for each breakpoint.

This is a summary of certain changes to the Fund since June 1, 2023. For more complete information, you may review the Fund’s current prospectus and any applicable supplements at https://www.franklintempleton.com/regulatory-fund-documents  or upon request at (800) DIAL BEN/342-5236 or prospectus@franklintempleton.com.

	WHERE CAN I FIND ADDITIONAL INFORMATION ABOUT THE FUND?
	Additional information is available on https://www.franklintempleton.com/regulatory-fund-documents, including its:
	• prospectus • proxy voting information • financial information • holdings • tax information

HOUSEHOLDING

You will receive the Fund’s shareholder 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 shareholder reports 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) DIAL BEN/342-5236. At any time you may view current prospectuses/summary prospectuses and shareholder reports on our website. If you choose, you may receive these documents through electronic delivery.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 3	820-ATSR-0724

100001056710063106461099511114110711239611590113991245910000105089938116811306312894135941928317975181282239810000101119404996710255987710168115451119611055117061000010003100181006210191104211061310624106401097411573

K2 Alternative Strategies Fund
Class R6 [FASRX]
Annual Shareholder Report | May 31, 2024

This annual shareholder report contains important information about K2 Alternative Strategies Fund for the period June 1, 2023, to May 31, 2024.
You can find additional information about the Fund at https://www.franklintempleton.com/regulatory-fund-documents. You can also request this information by contacting us at (800) DIAL BEN/342-5236.

This report describes changes to the Fund that occurred during the reporting period.

WHAT WERE THE FUND COSTS FOR THE LAST YEAR? (based on a hypothetical $10,000 investment)

Class Name	Costs of $10,000 investment	Costs paid as a percentage of a $10,000 investment*
Class R6	$237	2.26%

* Reflects fee waivers and/or expense reimbursements, without which expenses would have been higher.

HOW DID THE FUND PERFORM LAST YEAR AND WHAT AFFECTED ITS PERFORMANCE?

For the twelve months ended May 31, 2024, Class R6 shares of K2 Alternatives Strategies Fund returned 10.03%. The Fund compares its performance to the HFRX Global Hedge Fund Index and the ICE BofA U.S. 3-Month Treasury Bill Index, which returned 5.89% and 5.45%, respectively, for the same period.

PERFORMANCE HIGHLIGHTS

Top contributors to performance:
↑	At the asset class level, long positioning in equities drove gains, led by the industrials, utilities and health care sectors. Long fixed income positioning and currency hedges also aided performance, led by emerging market sovereign bonds and short positioning against the Swiss franc.
↑	Long short equity was the largest strategy contributor, with gains driven by long equity positioning in the industrials, utilities and health care sectors.
↑	Long short equity sub-advisor Electron Capital Partners was the leading contributor, driven by long positioning in the industrials sector, especially the capital goods industry, and in utilities.

Top detractors from performance:
↓	Among asset classes, commodity positioning weighed the most on returns, due to short positions in agricultural and metal commodities held by sub-advisor Capital Fund Management (CFM). Credit positioning also detracted, due to credit default swaps by RBC Global Asset Management (UK) (formerly, BlueBay Asset Management) in emerging market sovereign bonds.
↓	The Strategic Overlay strategy, activated at the end of the first quarter of 2024, was a modest detractor as its long exposure to S&P 500® Index futures weighed slightly on returns.
↓	Three of the sub-advisors modestly detracted. One River Asset Management, a relative value sub-advisor (exited in March 2024) weighed the most on returns.

Use of derivatives and the impact on performance:

Derivatives make up a significant portion of the Fund’s holdings across multiple asset classes and security types. During the period, derivatives were an overall contributor to performance, as gains from equity total return swaps, equity index futures and interest rate contracts outweighed losses from credit default swaps, commodity futures and foreign exchange forward contracts.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 1	830-ATSR-0724

HOW DID THE FUND PERFORM OVER THE LAST 10 YEARS?

The Fund’s past performance is not necessarily an indication of how the Fund will perform in the future. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares.

VALUE OF A $10,000 INVESTMENT – Class R6 5/31/2014 — 5/31/2024

AVERAGE ANNUAL TOTAL RETURNS (%) Period Ended May 31, 2024

	1 Year	5 Year	10 Year
Class R6 (without sales charge)	10.03	2.89	2.84
Class R6 (with sales charge)	10.03	2.89	2.84
MSCI All Country World Index-NR	23.56	11.67	8.40
HFRX Global Hedge Fund Index	5.89	3.46	1.59
ICE BofA U.S. 3-Month Treasury Bill Index	5.45	2.12	1.47

Fund performance figures may reflect fee waivers and/or expense reimbursements, without which the performance would have been lower.

For current month-end performance, please call Franklin Templeton at (800) DIAL BEN/342-5236 or visit https://www.franklintempleton.com/investments/options/mutual-funds.  

Important data provider notices and terms available at   www.franklintempletondatasources.com.

KEY FUND STATISTICS (as of May 31, 2024)

Total Net Assets	$634,669,943
Total Number of Portfolio Holdings*	721
Total Management Fee Paid	$11,431,760
Portfolio Turnover Rate	257.70%

* Does not include derivatives, except purchased option contracts, if any.

WHAT DID THE FUND INVEST IN?  (as of May 31, 2024)

Strategy Allocation (% of Total Net Assets)

	Long Positions	Short Positions
Long Short Equity	43.2	-32.4
Relative Value	51.6	-26.1
Event Driven	2.3	-2.0
Global Macro	95.0	-136.3
Strategic Overlay	3.0	--
Total	195.1	-196.8

Figures include the effect of gross notional exposure of derivatives.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 2	830-ATSR-0724

HOW HAS THE FUND CHANGED?

In October 2023, the Fund revised its investment strategies to reflect that the Fund’s investment manager may directly manage a portion of the Fund’s assets in one or more of the Fund’s alternative investment strategies. In March 2024, the Fund further revised its investment strategies to reflect that the Fund’s investment manager: (i) may directly manage up to a substantial portion of the Fund’s assets in one or more of the Fund’s alternative investment strategies; and (ii) manages a small portion of the Fund’s assets according to its strategic overlay strategy, which uses derivatives and other instruments to adjust the Fund’s net exposure to markets, asset classes and sectors. The investment manager of the Fund, however, still allocates a substantial portion (or, at times, up to all) of the Fund’s assets to affiliated and unaffiliated sub-advisors to implement the Fund’s alternative investment strategies.

Effective as of June 3, 2024, the Fund’s named portfolio management team consists of Lillian C. Night, Art Vinokur, Brooks Ritchey, Robert Christian and Anthony Zanolla. It is anticipated that Mr. Ritchey will retire and step down as a member of the Fund’s portfolio management team on or about September 30, 2024.

Effective July 1, 2023, the Fund’s contractual fee and expense cap on operating expenses was reduced from 1.95% to 1.90% (excluding Rule 12b-1 fees, acquired fund fees and expenses, expenses related to securities sold short and certain non-routine expenses or costs). Effective March 1, 2024, this contractual fee and expense cap on operating expenses was further reduced to 1.70% through September 30, 2025.

In addition, effective on March 1, 2024, the Fund’s contractual management fee schedule was reduced by 0.20% for each breakpoint.

This is a summary of certain changes to the Fund since June 1, 2023. For more complete information, you may review the Fund’s current prospectus and any applicable supplements at https://www.franklintempleton.com/regulatory-fund-documents  or upon request at (800) DIAL BEN/342-5236 or prospectus@franklintempleton.com.

	WHERE CAN I FIND ADDITIONAL INFORMATION ABOUT THE FUND?
	Additional information is available on https://www.franklintempleton.com/regulatory-fund-documents, including its:
	• prospectus • proxy voting information • financial information • holdings • tax information

HOUSEHOLDING

You will receive the Fund’s shareholder 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 shareholder reports 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) DIAL BEN/342-5236. At any time you may view current prospectuses/summary prospectuses and shareholder reports on our website. If you choose, you may receive these documents through electronic delivery.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 3	830-ATSR-0724

100001055110215108681128511476115071295912174120281323410000105089938116811306312894135941928317975181282239810000101119404996710255987710168115451119611055117061000010003100181006210191104211061310624106401097411573

K2 Alternative Strategies Fund
Advisor Class [FABZX]
Annual Shareholder Report | May 31, 2024

This annual shareholder report contains important information about K2 Alternative Strategies Fund for the period June 1, 2023, to May 31, 2024.
You can find additional information about the Fund at https://www.franklintempleton.com/regulatory-fund-documents. You can also request this information by contacting us at (800) DIAL BEN/342-5236.

This report describes changes to the Fund that occurred during the reporting period.

WHAT WERE THE FUND COSTS FOR THE LAST YEAR? (based on a hypothetical $10,000 investment)

Class Name	Costs of $10,000 investment	Costs paid as a percentage of a $10,000 investment*
Advisor Class	$244	2.33%

* Reflects fee waivers and/or expense reimbursements, without which expenses would have been higher.

HOW DID THE FUND PERFORM LAST YEAR AND WHAT AFFECTED ITS PERFORMANCE?

For the twelve months ended May 31, 2024, Advisor Class shares of K2 Alternatives Strategies Fund returned 9.87%. The Fund compares its performance to the HFRX Global Hedge Fund Index and the ICE BofA U.S. 3-Month Treasury Bill Index, which returned 5.89% and 5.45%, respectively, for the same period.

PERFORMANCE HIGHLIGHTS

Top contributors to performance:
↑	At the asset class level, long positioning in equities drove gains, led by the industrials, utilities and health care sectors. Long fixed income positioning and currency hedges also aided performance, led by emerging market sovereign bonds and short positioning against the Swiss franc.
↑	Long short equity was the largest strategy contributor, with gains driven by long equity positioning in the industrials, utilities and health care sectors.
↑	Long short equity sub-advisor Electron Capital Partners was the leading contributor, driven by long positioning in the industrials sector, especially the capital goods industry, and in utilities.

Top detractors from performance:
↓	Among asset classes, commodity positioning weighed the most on returns, due to short positions in agricultural and metal commodities held by sub-advisor Capital Fund Management (CFM). Credit positioning also detracted, due to credit default swaps by RBC Global Asset Management (UK) (formerly, BlueBay Asset Management) in emerging market sovereign bonds.
↓	The Strategic Overlay strategy, activated at the end of the first quarter of 2024, was a modest detractor as its long exposure to S&P 500® Index futures weighed slightly on returns.
↓	Three of the sub-advisors modestly detracted. One River Asset Management, a relative value sub-advisor (exited in March 2024) weighed the most on returns.

Use of derivatives and the impact on performance:

Derivatives make up a significant portion of the Fund’s holdings across multiple asset classes and security types. During the period, derivatives were an overall contributor to performance, as gains from equity total return swaps, equity index futures and interest rate contracts outweighed losses from credit default swaps, commodity futures and foreign exchange forward contracts.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 1	10-ATSR-0724

HOW DID THE FUND PERFORM OVER THE LAST 10 YEARS?

The Fund’s past performance is not necessarily an indication of how the Fund will perform in the future. The graph and table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares.

VALUE OF A $10,000 INVESTMENT – Advisor Class 5/31/2014 — 5/31/2024

AVERAGE ANNUAL TOTAL RETURNS (%) Period Ended May 31, 2024

	1 Year	5 Year	10 Year
Advisor Class (without sales charge)	9.87	2.83	2.78
Advisor Class (with sales charge)	9.87	2.83	2.78
MSCI All Country World Index-NR	23.56	11.67	8.40
HFRX Global Hedge Fund Index	5.89	3.46	1.59
ICE BofA U.S. 3-Month Treasury Bill Index	5.45	2.12	1.47

Fund performance figures may reflect fee waivers and/or expense reimbursements, without which the performance would have been lower.

For current month-end performance, please call Franklin Templeton at (800) DIAL BEN/342-5236 or visit https://www.franklintempleton.com/investments/options/mutual-funds.  

Important data provider notices and terms available at   www.franklintempletondatasources.com.

KEY FUND STATISTICS (as of May 31, 2024)

Total Net Assets	$634,669,943
Total Number of Portfolio Holdings*	721
Total Management Fee Paid	$11,431,760
Portfolio Turnover Rate	257.70%

* Does not include derivatives, except purchased option contracts, if any.

WHAT DID THE FUND INVEST IN?  (as of May 31, 2024)

Strategy Allocation (% of Total Net Assets)

	Long Positions	Short Positions
Long Short Equity	43.2	-32.4
Relative Value	51.6	-26.1
Event Driven	2.3	-2.0
Global Macro	95.0	-136.3
Strategic Overlay	3.0	--
Total	195.1	-196.8

Figures include the effect of gross notional exposure of derivatives.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 2	10-ATSR-0724

HOW HAS THE FUND CHANGED?

In October 2023, the Fund revised its investment strategies to reflect that the Fund’s investment manager may directly manage a portion of the Fund’s assets in one or more of the Fund’s alternative investment strategies. In March 2024, the Fund further revised its investment strategies to reflect that the Fund’s investment manager: (i) may directly manage up to a substantial portion of the Fund’s assets in one or more of the Fund’s alternative investment strategies; and (ii) manages a small portion of the Fund’s assets according to its strategic overlay strategy, which uses derivatives and other instruments to adjust the Fund’s net exposure to markets, asset classes and sectors. The investment manager of the Fund, however, still allocates a substantial portion (or, at times, up to all) of the Fund’s assets to affiliated and unaffiliated sub-advisors to implement the Fund’s alternative investment strategies.

Effective as of June 3, 2024, the Fund’s named portfolio management team consists of Lillian C. Night, Art Vinokur, Brooks Ritchey, Robert Christian and Anthony Zanolla. It is anticipated that Mr. Ritchey will retire and step down as a member of the Fund’s portfolio management team on or about September 30, 2024.

Effective July 1, 2023, the Fund’s contractual fee and expense cap on operating expenses was reduced from 1.95% to 1.90% (excluding Rule 12b-1 fees, acquired fund fees and expenses, expenses related to securities sold short and certain non-routine expenses or costs). Effective March 1, 2024, this contractual fee and expense cap on operating expenses was further reduced to 1.70% through September 30, 2025.

In addition, effective on March 1, 2024, the Fund’s contractual management fee schedule was reduced by 0.20% for each breakpoint.

This is a summary of certain changes to the Fund since June 1, 2023. For more complete information, you may review the Fund’s current prospectus and any applicable supplements at https://www.franklintempleton.com/regulatory-fund-documents  or upon request at (800) DIAL BEN/342-5236 or prospectus@franklintempleton.com.

	WHERE CAN I FIND ADDITIONAL INFORMATION ABOUT THE FUND?
	Additional information is available on https://www.franklintempleton.com/regulatory-fund-documents, including its:
	• prospectus • proxy voting information • financial information • holdings • tax information

HOUSEHOLDING

You will receive the Fund’s shareholder 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 shareholder reports 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) DIAL BEN/342-5236. At any time you may view current prospectuses/summary prospectuses and shareholder reports on our website. If you choose, you may receive these documents through electronic delivery.

K2 Alternative Strategies Fund
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE	PAGE 3	10-ATSR-0724

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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 19(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 experts are Ann Torre Bates, David W. Niemiec and Valerie M. Williams and they are “independent” as defined under the relevant Securities and Exchange Commission Rules and Releases.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) Audit Fees

The aggregate fees paid to the principal accountant for professional services rendered by the principal accountant for the audit of the registrant’s annual financial statements or for services that are normally provided by the principal accountant in connection with statutory and regulatory filings or engagements were $174,873 for the fiscal year ended May 31, 2024 and $189,474 for the fiscal year ended May 31, 2023.

(b) Audit-Related Fees

There were no fees paid to the principal accountant for assurance and related services rendered by the principal accountant to the registrant that are reasonably related to the performance of the audit of the registrant's financial statements and are not reported under paragraph (a) of Item 4.

There were no fees paid to the principal accountant for assurance and related services rendered by the principal accountant to the registrant's investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant that are reasonably related to the performance of the audit of their financial statements.

(c) Tax Fees

There were no fees paid to the principal accountant for professional services rendered by the principal accountant to the registrant for tax compliance, tax advice and tax planning.

There were no fees paid to the principal accountant for professional services rendered by the principal accountant to the registrant’s investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant for tax compliance, tax advice and tax planning.

(d) All Other Fees

There were no fees paid to the principal accountant for products and services rendered by the principal accountant to the registrant other than the services reported in paragraphs (a)-(c) of Item 4.

There were no fees paid to the principal accountant for products and services rendered by the principal accountant to the registrant’s investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant other than the services reported in paragraphs (a)-(c) of Item 4.

(e) (1) The registrant’s audit committee is directly responsible for approving the services to be provided by the auditors, including:

(i)       pre-approval of all audit and audit related services;

(ii)       pre-approval of all non-audit related services to be provided to the Fund by the auditors;

(iii)       pre-approval of all non-audit related services to be provided to the registrant by the auditors to the registrant’s investment adviser or to any entity that controls, is controlled by or is under common control with the registrant’s investment adviser and that provides ongoing services to the registrant where the non-audit services relate directly to the operations or financial reporting of the registrant; and

(iv)       establishment by the audit committee, if deemed necessary or appropriate, as an alternative to committee pre-approval of services to be provided by the auditors, as required by paragraphs (ii) and (iii) above, of policies and procedures to permit such services to be pre-approved by other means, such as through establishment of guidelines or by action of a designated member or members of the committee; provided the policies and procedures are detailed as to the particular service and the committee is informed of each service and such policies and procedures do not include delegation of audit committee responsibilities, as contemplated under the Securities Exchange Act of 1934, to management; subject, in the case of (ii) through (iv), to any waivers, exceptions or exemptions that may be available under applicable law or rules.

(e) (2) None of the services provided to the registrant described in paragraphs (b)-(d) of Item 4 were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of regulation S-X.

(f) No disclosures are required by this Item 4(f).

(g) There were no fees paid to the principal accountant for services rendered by the principal accountant to the registrant and the registrant’s investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant.

(h) The registrant’s audit committee of the board has considered whether the provision of non-audit services that were rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.

(i) Not Applicable

(j) Not Applicable

ITEM 5.   AUDIT COMMITTEE OF LISTED REGISTRANTS.

Not applicable

ITEM 6. SCHEDULE OF INVESTMENTS.

a) Please see schedule of investments contained in the Financial Statements and Financial Highlights included under Item 7 of this Form N-CSR.

b) Not applicable.

ITEM 7. FINANCIAL STATEMENTS AND FINANCIAL HIGHLIGHTS FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES.

 

K2 Alternative Strategies Fund

Franklin Alternative Strategies Funds

Financial Statements and Other Important Information

Annual	| May 31, 2024

 

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Table of Contents

Consolidated Financial Highlights and Consolidated Schedule of Investments			3
Consolidated Financial Statements			71
Notes to Consolidated Financial Statements			75
Report of Independent Registered Public Accounting Firm			91
Tax Information (unaudited)			92
Changes In and Disagreements with Accountants			93
Results of Meetings of Shareholders			93
Remuneration Paid to Directors, Officers and Others			93
Board Approval of Management and Subadvisory Agreements			93

2			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

Consolidated Financial Highlights

K2 Alternative Strategies Fund

				Year Ended May 31,
				2024			2023			2022			2021			2020
	Class A
	Per share operating performance (for a share outstanding throughout the year)
	Net asset value, beginning of year			$10.69			$11.16			$12.46			$11.19			$11.28
	Income from investment operationsa:
	Net investment income (loss)b			0.24			0.15			(0.06)			(0.08)			(0.03)
	Net realized and unrealized gains (losses)			0.79			(0.32)			(0.68)			1.45			0.02
	Total from investment operations			1.03			(0.17)			(0.74)			1.37			(0.01)
	Less distributions from:
	Net investment income			(0.05)			(0.21)			(0.06)			—			(0.07)
	Net realized gains			—			(0.09)			(0.50)			(0.10)			(0.01)
	Total distributions			(0.05)			(0.30)			(0.56)			(0.10)			(0.08)
	Net asset value, end of year			$11.67			$10.69			$11.16			$12.46			$11.19
	Total returnc			9.57%			(1.48)%			(6.25)%			12.25%			(0.15)%
	Ratios to average net assets
	Expenses before waiver, payments by affiliates and expense reductiond			2.83%			2.82%			2.75%			2.82%			2.58%
	Expenses net of waiver, payments by affiliates and expense reductiond			2.57%			2.64%			2.60%e			2.64%			2.40%
	Expenses incurred in connection with securities sold short			0.47%			0.45%			0.40%			0.44%			0.20%
	Net investment income (loss)			2.22%			1.31%			(0.49)%			(0.67)%			(0.25)%
	Supplemental data
	Net assets, end of year (000’s)			$63,320			$76,464			$94,580			$102,138			$90,205
	Portfolio turnover rate			257.70%			225.53%			177.61%			236.64%			271.51%

aThe amount shown for a share outstanding throughout the period may not correlate with the Consolidated 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.

bBased on average daily shares outstanding.

cTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable.

dIncludes dividend and/or interest expense on securities sold short and security borrowing fees, if any. See below for the ratios of such expenses to average net assets for the periods presented. See Note 1(e).

eBenefit of expense reduction rounds to less than 0.01%.

franklintempleton.com			The accompanying notes are an integral part of these consolidated financial statements. | Annual Report			3

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED FINANCIAL HIGHLIGHTS

 

K2 Alternative Strategies Fund (continued)

				Year Ended May 31,
				2024			2023			2022			2021			2020
	Class C
	Per share operating performance (for a share outstanding throughout the year)
	Net asset value, beginning of year			$10.35			$10.80			$12.11			$10.95			$11.05
	Income from investment operationsa:
	Net investment income (loss)b			0.15			0.06			(0.15)			(0.15)			(0.11)
	Net realized and unrealized gains (losses)			0.77			(0.31)			(0.66)			1.41			0.02
	Total from investment operations			0.92			(0.25)			(0.81)			1.26			(0.09)
	Less distributions from:
	​Net investment income			—			(0.11)			—			—			—
	​Net realized gains			—			(0.09)			(0.50)			(0.10)			(0.01)
	Total distributions			—			(0.20)			(0.50)			(0.10)			(0.01)
	Net asset value, end of year			$11.27			$10.35			$10.80			$12.11			$10.95
	Total returnc			​8.69%			(2.12)%			(7.06)%			11.51%			(0.85)%
	Ratios to average net assets
	Expenses before waiver, payments by affiliates and expense reductiond			3.60%			3.57%			3.50%			3.54%			3.33%
	Expenses net of waiver, payments by affiliates and expense reductiond			3.33%			3.39%			3.35%e			3.36%			3.15%
	Expenses incurred in connection with securities sold short			0.47%			0.45%			0.40%			0.44%			0.20%
	Net investment income (loss)			1.46%			0.55%			(1.24)%			(1.39)%			(1.00)%
	Supplemental data
	Net assets, end of year (000’s)			$7,957			$15,720			$24,486			$31,541			$36,043
	Portfolio turnover rate			257.70%			225.53%			177.61%			236.64%			271.51%

aThe amount shown for a share outstanding throughout the period may not correlate with the Consolidated 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.

bBased on average daily shares outstanding.

cTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable.

dIncludes dividend and/or interest expense on securities sold short and security borrowing fees, if any. See below for the ratios of such expenses to average net assets for the periods presented. See Note 1(e).

eBenefit of expense reduction rounds to less than 0.01%.

4			Annual Report | The accompanying notes are an integral part of these consolidated financial statements.			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED FINANCIAL HIGHLIGHTS

 

K2 Alternative Strategies Fund (continued)

				Year Ended May 31,
				2024			2023			2022			2021			2020
	Class R
	Per share operating performance (for a share outstanding throughout the year)
	Net asset value, beginning of year			$10.73			$11.13			$12.44			$11.20			$11.28
	Income from investment operationsa:
	Net investment income (loss)b			0.22			0.10			(0.08)			(0.11)			(0.06)
	Net realized and unrealized gains (losses)			0.80			(0.31)			(0.68)			1.45			0.02
	Total from investment operations			1.02			(0.21)			(0.76)			1.34			(0.04)
	Less distributions from:
	Net investment income			(0.02)			(0.10)			(0.05)			—			(0.03)
	Net realized gains			—			(0.09)			(0.50)			(0.10)			(0.01)
	Total distributions			(0.02)			(0.19)			(0.55)			(0.10)			(0.04)
	Net asset value, end of year			$11.73			$10.73			$11.13			$12.44			$11.20
	Total return			9.30%			(1.65)%			(6.50)%			11.97%			(0.39)%
	Ratios to average net assets
	Expenses before waiver, payments by affiliates and expense reductionc			3.07%			3.07%			3.04%			3.06%			2.83%
	Expenses net of waiver, payments by affiliates and expense reductionc			2.82%			2.89%			2.85%d			2.88%			2.65%
	Expenses incurred in connection with securities sold short			0.47%			0.45%			0.40%			0.44%			0.20%
	Net investment income (loss)			1.97%			1.05%			(0.78)%			(0.91)%			(0.50)%
	Supplemental data
	Net assets, end of year (000’s)			$348			$351			$811			$840			$884
	Portfolio turnover rate			257.70%			225.53%			177.61%			236.64%			271.51%

aThe amount shown for a share outstanding throughout the period may not correlate with the Consolidated 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.

bBased on average daily shares outstanding.

cIncludes dividend and/or interest expense on securities sold short and security borrowing fees, if any. See below for the ratios of such expenses to average net assets for the periods presented. See Note 1(e).

dBenefit of expense reduction rounds to less than 0.01%.

franklintempleton.com			The accompanying notes are an integral part of these consolidated financial statements. | Annual Report			5

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED FINANCIAL HIGHLIGHTS

 

K2 Alternative Strategies Fund (continued)

				Year Ended May 31,
				2024			2023			2022			2021			2020
	Class R6
	Per share operating performance (for a share outstanding throughout the year)
	Net asset value, beginning of year			$10.78			$11.27			$12.58			$11.25			$11.34
	Income from investment operationsa:
	Net investment income (loss)b			0.29			0.18			(0.02)			(0.04)			0.01
	Net realized and unrealized gains (losses)			0.79			(0.33)			(0.69)			1.47			0.02
	Total from investment operations			1.08			(0.15)			(0.71)			1.43			0.03
	Less distributions from:
	Net investment income			(0.09)			(0.25)			(0.10)			—			(0.11)
	Net realized gains			—			(0.09)			(0.50)			(0.10)			(0.01)
	Total distributions			(0.09)			(0.34)			(0.60)			(0.10)			(0.12)
	Net asset value, end of year			$11.77			$10.78			$11.27			$12.58			$11.25
	Total return			10.03%			(1.20)%			(6.05)%			12.61%			0.27%
	Ratios to average net assets
	Expenses before waiver, payments by affiliates and expense reductionc			2.47%			2.48%			2.44%			2.50%			2.26%
	Expenses net of waiver, payments by affiliates and expense reductionc			2.26%			2.36%			2.32%d			2.32%			2.07%
	Expenses incurred in connection with securities sold short			0.47%			0.45%			0.40%			0.44%			0.20%
	Net investment income (loss)			2.54%			1.64%			(0.18)%			(0.35)%			0.08%
	Supplemental data
	Net assets, end of year (000’s)			$124,279			$44,192			$47,851			$27,471			$15,537
	Portfolio turnover rate			257.70%			225.53%			177.61%			236.64%			271.51%

aThe amount shown for a share outstanding throughout the period may not correlate with the Consolidated 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.

bBased on average daily shares outstanding.

cIncludes dividend and/or interest expense on securities sold short and security borrowing fees, if any. See below for the ratios of such expenses to average net assets for the periods presented. See Note 1(e).

dBenefit of expense reduction rounds to less than 0.01%.

6			Annual Report | The accompanying notes are an integral part of these consolidated financial statements.			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED FINANCIAL HIGHLIGHTS

 

K2 Alternative Strategies Fund (continued)

				Year Ended May 31,
				2024			2023			2022			2021			2020
	Advisor Class
	Per share operating performance (for a share outstanding throughout the year)
	Net asset value, beginning of year			$10.76			$11.24			$12.55			$11.23			$11.33
	Income from investment operationsa:
	Net investment income (loss)b			0.27			0.17			(0.03)			(0.05)			—c
	Net realized and unrealized gains (losses)			0.81			(0.32)			(0.69)			1.47			0.01
	Total from investment operations			1.08			(0.15)			(0.72)			1.42			0.01
	Less distributions from:
	Net investment income			(0.08)			(0.24)			(0.09)			—			(0.10)
	Net realized gains			—			(0.09)			(0.50)			(0.10)			(0.01)
	Total distributions			(0.08)			(0.33)			(0.59)			(0.10)			(0.11)
	Net asset value, end of year			$11.76			$10.76			$11.24			$12.55			$11.23
	Total return			9.87%			(1.21)%			(6.05)%			12.55%			0.19%
	Ratios to average net assets
	Expenses before waiver, payments by affiliates and expense reductiond			2.60%			2.57%			2.50%			2.57%			2.33%
	Expenses net of waiver, payments by affiliates and expense reductiond			2.33%			2.39%			2.35%e			2.39%			2.15%
	Expenses incurred in connection with securities sold short			0.47%			0.45%			0.40%			0.44%			0.20%
	Net investment income (loss)			2.46%			1.55%			(0.24)%			(0.42)%			—f
	Supplemental data
	Net assets, end of year (000’s)			$438,766			$710,974			$1,099,387			$1,152,105			$977,094
	Portfolio turnover rate			257.70%			225.53%			177.61%			236.64%			271.51%

aThe amount shown for a share outstanding throughout the period may not correlate with the Consolidated 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.

bBased on average daily shares outstanding.

cAmount rounds to less than $0.01.

dIncludes dividend and/or interest expense on securities sold short and security borrowing fees, if any. See below for the ratios of such expenses to average net assets for the periods presented. See Note 1(e).

eBenefit of expense reduction rounds to less than 0.01%.

fAmount rounds to less than 0.01%.

franklintempleton.com			The accompanying notes are an integral part of these consolidated financial statements. | Annual Report			7

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

Consolidated Schedule of Investments, May 31, 2024

K2 Alternative Strategies Fund

Country

Shares/ Warrants/ Rights

Value

Common Stocks and Other Equity Interests 20.2%

Aerospace & Defense 0.0%†

a

Astroscale Holdings Inc.

Japan

1,600

$8,648

a

Satellogic Inc., 1/25/27, wts.

United States

2,058

243

8,891

Biotechnology 3.5%

Amgen Inc.

United States

6,973

2,132,692

a

Apellis Pharmaceuticals Inc.

United States

41,412

1,625,421

a

Apogee Therapeutics Inc.

United States

19,447

887,561

a

Argenx SE, ADR

Netherlands

3,267

1,212,122

a

Celldex Therapeutics Inc.

United States

26,796

892,307

a,b

Crinetics Pharmaceuticals Inc.

United States

46,969

2,085,893

a

Dyne Therapeutics Inc.

United States

54,392

1,734,017

a

Ideaya Biosciences Inc.

United States

16,994

621,131

a

Insmed Inc.

United States

19,283

1,061,529

a,c

Krystal Biotech Inc.

United States

5,727

916,606

a,b,c

Kymera Therapeutics Inc.

United States

15,753

505,829

a,b

Neurocrine Biosciences Inc.

United States

11,578

1,567,777

a

Regeneron Pharmaceuticals Inc.

United States

2,171

2,127,927

a

Vaxcyte Inc.

United States

20,312

1,427,324

a

Vera Therapeutics Inc., A

United States

16,144

613,311

a,b

Vertex Pharmaceuticals Inc.

United States

5,391

2,454,738

a

Xenon Pharmaceuticals Inc.

Canada

16,099

612,889

22,479,074

Building Products 0.3%

a

Johnson Controls International PLC

United States

23,449

1,686,218

Capital Markets 0.0%†

b

Palmer Square Capital BDC Inc.

United States

3,910

64,280

Chemicals 0.0%†

a,d

Covestro AG, 144A

Germany

3,162

170,366

Communications Equipment 0.0%†

a,b

Commscope Holding Co. Inc.

United States

13,626

19,622

a,e

Riverbed Technology, Inc.

United States

1,499

—

Spirent Communications PLC

United Kingdom

44,520

104,718

124,340

Construction & Engineering 1.3%

a

Centuri Holdings Inc.

United States

3,120

85,644

a

Mastec Inc.

United States

42,735

4,797,004

Quanta Services Inc.

United States

13,339

3,680,763

8,563,411

Construction Materials 0.4%

a

CRH PLC

United States

27,347

2,235,891

Consumer Staples Distribution & Retail 0.0%†

b,f

Albertsons Cos. Inc., A

United States

12,882

265,884

Containers & Packaging 0.0%†

DS Smith PLC

United Kingdom

31,031

152,190

8			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Shares/ Warrants/ Rights						Value
			Common Stocks and Other Equity Interests (continued)20.2%
			Diversified Financial Services 0.0%†
a			Conx Corp., A, 10/30/27, wts.			United States			14,679						$2,238
a			Nabors Energy Transition Corp. II, 9/05/28, wts.			United States			2,168						280
a,e			Pegasus Acquisition Co. Europe BV, A			Netherlands			30,999						—
a,e			Pershing Square Tontine Holdings Ltd., A			United States			42,829						—
e			Pershing Square Tontine Holdings Ltd., Contingent Value, rts., 12/31/33, A			United States			10,707						—
a			Southport Acquisition Corp., 5/24/28, wts.			United States			4,946						256
a,e			Spree Acquisition Corp. 1 Ltd., 12/22/28, wts.			Israel			3,069						77
a			Target Global Acquisition I Corp., A, 12/31/27, wts.			Israel			3,516						308
a			Teract SA, 11/16/25, wts.			France			3,920						2
															3,161
			Diversified Telecommunication Services 0.0%†
a			Telecom Italia SpA			Italy			433,740						114,337
			Electric Utilities 2.9%
			Constellation Energy Corp.			United States			31,268						6,792,973
b			Edison International			United States			34,556						2,655,629
			Entergy Corp.			United States			17,039						1,916,717
			Eversource Energy			United States			16,318						966,515
			NextEra Energy Inc.			United States			20,238						1,619,445
b			PG&E Corp.			United States			125,719						2,330,830
			PPL Corp.			United States			76,425						2,241,545
															18,523,654
			Electrical Equipment 2.4%
a			Array Technologies Inc.			United States			103,718						1,470,721
a			Bloom Energy Corp., A			United States			37,457						611,298
a,b			Enovix Corp.			United States			161,898						1,719,357
a			Fluence Energy Inc., A			United States			48,034						1,207,094
a			GE Vernova Inc.			United States			22,273						3,917,821
a			Nextracker Inc., A			United States			9,304						513,302
b,f			Vertiv Holdings Co., A			United States			56,195						5,511,044
															14,950,637
			Energy Equipment & Services 0.1%
a			Nabors Industries Ltd.			United States			6,899						515,769
a			US Silica Holdings Inc.			United States			1,142						17,690
															533,459
			Entertainment 0.1%
			Endeavor Group Holdings Inc., A			United States			17,071						458,015
			Financial Services 0.1%
a,d			Network International Holdings PLC, 144A			United Arab Emirates			42,169						211,174
a,d			Nexi SpA, 144A			Italy			18,289						121,742
															332,916
			Ground Transportation 0.1%
			ALPS Logistics Co. Ltd.			Japan			979						35,289
a,b			Uber Technologies Inc.			United States			12,151						784,468
															819,757
			Health Care Equipment & Supplies 2.1%
a			Axonics Inc.			United States			1,772						118,884
a			Bausch + Lomb Corp.			United States			654						10,032
b			Becton Dickinson & Co.			United States			10,023						2,325,035

franklintempleton.com			Annual Report			9

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Shares/ Warrants/ Rights						Value
			Common Stocks and Other Equity Interests (continued)20.2%
			Health Care Equipment & Supplies (continued)2.1%
a,b			Boston Scientific Corp.			United States			15,123						$ 1,142,845
			The Cooper Cos. Inc.			United States			12,578						1,186,231
b			GE Healthcare Technologies Inc.			United States			6,093						475,254
a,b			Hologic Inc.			United States			22,186						1,636,883
a			Inari Medical Inc.			United States			41,731						2,086,550
a,b			Intuitive Surgical Inc.			United States			4,416						1,775,762
a,e			Shockwave Medical Inc.			United States			364						121,940
a			Solventum Corp.			United States			14,960						887,726
a,c			Tandem Diabetes Care Inc.			United States			34,276						1,755,960
															13,523,102
			Health Care Providers & Services 0.7%
a,b			Amedisys Inc.			United States			1,370						124,875
b			The Cigna Group			United States			2,746						946,326
a,b			Community Health Systems Inc.			United States			38,154						151,090
			Humana Inc.			United States			7,600						2,721,712
a,c			OPKO Health Inc.			United States			3,781						5,180
a			R1 Rcm Inc.			United States			8,858						113,914
b			UnitedHealth Group Inc.			United States			1,088						538,963
															4,602,060
			Hotels, Restaurants & Leisure 0.0%†
a			HomeToGo SE, 12/31/25, wts.			Luxembourg			716						1
a			Norwegian Cruise Line Holdings Ltd.			United States			9,018						149,699
															149,700
			Independent Power & Renewable Electricity Producers 1.3%
b			The AES Corp.			United States			105,556						2,278,954
			Clearway Energy Inc., C			United States			19,002						532,056
d			Neoen SA, 144A			France			852						35,142
a,b			Sunnova Energy International Inc.			United States			82,446						430,368
b			Vistra Corp.			United States			46,993						4,656,067
															7,932,587
			Industrial Conglomerates 1.1%
			3M Co.			United States			14,310						1,433,003
			General Electric Co.			United States			23,911						3,948,663
			Hitachi Ltd.			Japan			18,359						1,890,751
															7,272,417
			Interactive Media & Services 0.0%†
a			Karnov Group AB, B			Sweden			4,395						36,228
			IT Services 0.0%†
a			Brand Engagement Network Inc., A, 3/14/29, wts.			United States			241						36
a			Perficient Inc.			United States			950						70,443
a			Squarespace Inc., A			United States			816						35,904
															106,383
			Life Sciences Tools & Services 1.1%
			Agilent Technologies Inc.			United States			8,666						1,130,133
a			Avantor Inc.			United States			69,300						1,668,744
a			Inotiv Inc.			United States			2,165						4,049
			Lonza Group AG			Switzerland			1,613						875,618
a			Maravai Lifesciences Holdings Inc., A			United States			159,985						1,387,070
a			QIAGEN NV			United States			43,481						1,880,988
															6,946,602

10			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Country

Shares/ Warrants/ Rights

Value

Common Stocks and Other Equity Interests (continued)20.2%

Machinery 0.0%†

a,c

Desktop Metal Inc., A

United States

46,548

$26,239

Media 0.1%

a

Adtheorent Holding Co. Inc.

United States

9,802

31,268

a,b

Altice USA Inc., A

United States

116,237

288,268

Ascential PLC

United Kingdom

8,823

36,767

a,b

Clear Channel Outdoor Holdings Inc., A

United States

3,780

5,443

a,b

Iheartmedia Inc., A

United States

25,061

23,197

a,b,f

Liberty Media Corp.

United States

10,204

231,223

616,166

Metals & Mining 0.0%†

a

Samarco Mineracao SA Escrow

Brazil

384,000

317,261

Oil, Gas & Consumable Fuels 0.2%

a,e,g

Gazprom PJSC

Russia

615,160

—

f

Golar LNG Ltd.

Bermuda

4,770

125,403

Hess Corp.

United States

1,361

209,730

b

New Fortress Energy Inc., A

United States

31,538

799,488

b

Targa Resources Corp.

United States

2,284

270,038

1,404,659

Passenger Airlines 0.0%†

a

Jetblue Airways Corp.

United States

139

777

Pharmaceuticals 1.4%

AstraZeneca PLC, ADR

United Kingdom

26,217

2,045,450

b

Eli Lilly & Co.

United States

1,946

1,596,382

b

Merck & Co. Inc.

United States

20,001

2,510,925

b

Novo Nordisk AS, ADR

Denmark

18,943

2,562,609

8,715,366

Professional Services 0.1%

Applus Services SA

Spain

25,279

348,897

a

Falcon's Beyond Global Inc., A, 9/01/27, wts.

United States

180

270

349,167

Semiconductors & Semiconductor Equipment 0.2%

a

Arm Holdings PLC, ADR

United States

1,682

202,715

a

Enphase Energy Inc.

United States

6,818

872,022

a

Sequans Communications SA, ADR

France

109,092

85,092

1,159,829

Software 0.1%

Altium Ltd.

Australia

12,131

543,590

Specialized REITs 0.3%

Digital Realty Trust Inc.

United States

5,559

807,945

Equinix Inc.

United States

922

703,467

b

VICI Properties Inc., A

United States

16,615

477,017

1,988,429

Textiles Apparel & Luxury Goods 0.0%†

Gildan Activewear Inc., A

Canada

335

12,820

Trading Companies & Distributors 0.3%

b

Herc Holdings Inc.

United States

10,809

1,568,062

Total Common Stocks and Other Equity Interests (Cost $99,892,991)

​128,757,925

franklintempleton.com			Annual Report			11

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Country

Shares/ Warrants/ Rights

Value

Investment Companies (Cost $51,150) 0.0%†

Closed End Funds 0.0%†

The Hipgnosis Songs Fund Ltd. Fund

United Kingdom

39,587

$  50,685

Total Investment Companies (Cost $51,150)

50,685

Preferred Stocks 0.0%†

Financial Services 0.0%†

FHLMC, 8.375%, pfd., Z

United States

31,347

153,287

FNMA, 8.25%, pfd., S

United States

28,676

148,541

301,828

Total Preferred Stocks (Cost $226,082)

301,828

									Principal Amount*
			Convertible Bonds 11.9%
			Aerospace & Defense 0.1%
			Parsons Corp., senior note, 0.25%, 8/15/25			United States			269,000						454,920
d			Rocket Lab USA Inc., senior note, 144A, 4.25%, 2/01/29			United States			24,000						26,280
															481,200
			Airlines 0.1%
			American Airlines Group Inc., senior note, 6.50%, 7/01/25			United States			12,000						12,430
d			Cathay Pacific Finance III Ltd., senior note, Reg S, 2.75%, 2/05/26			Hong Kong			4,000,000			HKD			544,218
															556,648
			Automobile Components 0.1%
			LCI Industries, senior note, 1.125%, 5/15/26			United States			635,000						606,584
			Automobiles 0.0%†
b,d			Rivian Automotive Inc., senior note, 144A, 3.625%, 10/15/30			United States			355,000						242,147
d			Winnebago Industries Inc., senior note, 144A, 3.25%, 1/15/30			United States			10,000						9,863
															252,010
			Biotechnology 1.0%
			Apellis Pharmaceuticals Inc., senior note, 3.50%, 9/15/26			United States			186,000						239,567
b			BioMarin Pharmaceutical Inc., senior sub. note, 0.599%, 8/01/24			United States			724,000						717,846
d			Cerevel Therapeutics Holdings Inc., senior note, 144A, 2.50%, 8/15/27			United States			251,000						276,351
b			Coherus Biosciences Inc., senior sub. note, 1.50%, 4/15/26			United States			653,000						419,192
			Cytokinetics Inc., senior note, 3.50%, 7/01/27			United States			289,000						354,459
b			Dynavax Technologies Corp., senior note, 2.50%, 5/15/26			United States			1,111,000						1,431,412
			Halozyme Therapeutics Inc., senior note, 0.25%, 3/01/27			United States			182,000						164,801
			Ironwood Pharmaceuticals Inc., senior note,
			0.75%, 6/15/24			United States			457,000						453,924
			1.50%, 6/15/26			United States			19,000						17,700
			Karyopharm Therapeutics Inc., senior note, 3.00%, 10/15/25			United States			85,000						54,502
			Mannkind Corp., senior note, 2.50%, 3/01/26			United States			672,000						770,784
c			Mirum Pharmaceuticals Inc., senior note, 4.00%, 5/01/29			United States			22,000						24,324
			Natera Inc., senior note, 2.25%, 5/01/27			United States			399,000						1,124,864
b			Travere Therapeutics Inc., senior note, 2.25%, 3/01/29			United States			572,000						352,495
															6,402,221
			​Broadline Retail 0.4%
d			Alibaba Group Holding Ltd., senior note, 144A, 0.50%, 6/01/31			China			2,095,000						2,079,980
			Etsy Inc., senior note, 0.125%, 10/01/26			United States			241,000						245,368
d			JD.Com Inc., senior note, 144A, 0.25%, 6/01/29			China			9,000						8,874
															2,334,222
			Capital Markets 0.1%
			Coinbase Global Inc., senior note, 0.50%, 6/01/26			United States			384,000						396,672

12			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Principal Amount*						Value
			Convertible Bonds (continued)
			Chemicals 0.1%
d			Danimer Scientific Inc., senior note, 144A, 3.25%, 12/15/26			United States			189,000						$29,843
			Livent Corp., senior note, 4.125%, 7/15/25			United States			478,000						660,535
d			Purecycle Technologies Inc., senior note, 144A, 7.25%, 8/15/30			United States			24,000						13,102
															703,480
			Communications Equipment 0.0%†
			Viavi Solutions Inc., senior note, 1.625%, 3/15/26			United States			214,000						201,695
			Construction & Engineering 0.0%†
			Granite Construction Inc., senior note, 3.75%, 5/15/28			United States			25,000						36,525
			Consumer Finance 0.3%
			Encore Capital Group Inc., senior note,
			3.25%, 10/01/25			United States			279,000						342,612
			4.00%, 3/15/29			United States			459,000						435,820
			EZCORP Inc., senior note,
			2.875%, 7/01/24			United States			618,000						672,075
d			144A, 3.75%, 12/15/29			United States			188,000						217,046
d			Sofi Technologies Inc., senior note, 144A, 1.25%, 3/15/29			United States			289,000						274,695
d			SoFi Technologies Inc., senior note, 144A, zero cpn., 10/15/26			United States			212,000						183,380
															2,125,628
			Diversified Consumer Services 0.0%†
			Chegg Inc., senior note, 0.125%, 3/15/25			United States			336,000						315,841
			Diversified Financial Services 0.1%
d			Bread Financial Holdings Inc., senior note, 144A, 4.25%, 6/15/28			United States			425,000						541,875
			Lendingtree Inc., senior note, 0.50%, 7/15/25			United States			117,000						108,956
			Wisdomtree Inc., senior note, 5.75%, 8/15/28			United States			148,000						183,127
															833,958
			Diversified Telecommunication Services 0.2%
b,d			Match Group Financeco 2 Inc., senior note, 144A, 0.875%, 6/15/26			United States			1,195,000						1,083,984
			Electrical Equipment 0.0%†
d			Plug Power Inc., senior note, 144A, 7.00%, 6/01/26			United States			23,000						24,646
			Electronic Equipment, Instruments & Components 0.1%
			PAR Technology Corp., senior note, 2.875%, 4/15/26			United States			239,000						294,901
d			Vishay Intertechnology Inc., senior note, 144A, 2.25%, 9/15/30			United States			59,000						57,466
															352,367
			Energy Equipment & Services 0.2%
b			Transocean Inc., senior note, 4.625%, 9/30/29			United States			564,000						1,140,408
			Entertainment 0.3%
c			Live Nation Entertainment Inc., senior note, 3.125%, 1/15/29			United States			68,000						75,500
b			The Marcus Corp., senior note, 5.00%, 9/15/25			United States			328,000						368,016
			Sea Ltd., senior note,
b			2.375%, 12/01/25			Singapore			1,056,000						1,122,528
			0.25%, 9/15/26			Singapore			58,000						50,373
d			Sphere Entertainment Co., senior note, 144A, 3.50%, 12/01/28			United States			49,000						61,117
															1,677,534
			Financial Services 0.3%
			Block Inc., senior note,
			0.125%, 3/01/25			United States			813,000						782,065
			zero cpn., 5/01/26			United States			81,000						72,287
d			Repay Holdings Corp., senior note, 144A, zero cpn., 2/01/26			United States			816,000						747,162
															1,601,514
			Food & Staples Retailing 0.1%
			The Chefs’ Warehouse Inc., senior note, 2.375%, 12/15/28			United States			305,000						341,752

franklintempleton.com			Annual Report			13

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Principal Amount*						Value
			Convertible Bonds (continued)(continued)
			Ground Transportation 0.1%
			Lyft Inc., senior note,
			1.50%, 5/15/25			United States			294,000						$282,240
d			144A, 0.625%, 3/01/29			United States			19,000						19,589
			Uber Technologies Inc., senior note,
d			144A, 0.875%, 12/01/28			United States			58,000						64,053
			zero cpn., 12/15/25			United States			12,000						12,302
															378,184
			Health Care Equipment & Supplies 0.7%
			CONMED Corp., senior note, 2.25%, 6/15/27			United States			380,000						342,608
			Glaukos Corp., senior note, 2.75%, 6/15/27			United States			634,000						1,339,008
			Haemonetics Corp., senior note,
d			144A, 2.50%, 6/01/29			United States			19,000						18,667
			zero cpn., 3/01/26			United States			192,000						174,336
			Insulet Corp., senior note, 0.375%, 9/01/26			United States			501,000						520,847
d			iRhythm Technologies Inc., senior note, 144A, 1.50%, 9/01/29			United States			67,000						61,058
			Lantheus Holdings Inc., senior note, 2.625%, 12/15/27			United States			189,000						238,849
			Mesa Laboratories Inc., senior note, 1.375%, 8/15/25			United States			244,000						229,628
c,d			Tandem Diabetes Care Inc., 2024, senior note, 144A, 1.50%, 3/15/29			United States			480,000						798,960
b			Varex Imaging Corp., senior note, 4.00%, 6/01/25			United States			720,000						736,200
															4,460,161
			Health Care Providers & Services 0.2%
			NeoGenomics Inc., senior note, 1.25%, 5/01/25			United States			787,000						753,552
d			OPKO Health Inc., senior note, 144A, 3.75%, 1/15/29			United States			197,000						244,241
			PetIQ Inc., senior note, 4.00%, 6/01/26			United States			268,000						279,980
															1,277,773
			Health Care Technology 0.4%
			Bill Holdings Inc., senior note, zero cpn.,
			12/01/25			United States			123,000						113,957
			4/01/27			United States			241,000						205,332
			Evolent Health Inc., senior note,
			1.50%, 10/15/25			United States			513,000						504,664
c,d			144A, 3.50%, 12/01/29			United States			47,000						43,557
			Health Catalyst Inc., senior note, 2.50%, 4/15/25			United States			380,000						368,600
c			Integra Lifesciences Holdings Corp., senior note, 0.50%, 8/15/25			United States			787,000						739,977
b			Unity Software Inc., senior note, zero cpn., 11/15/26			United States			384,000						330,048
															2,306,135
			Hotel & Resort REITs 0.2%
b			Pebblebrook Hotel Trust, senior note, 1.75%, 12/15/26			United States			865,000						764,487
c			Summit Hotel Properties Inc., senior note, 1.50%, 2/15/26			United States			325,000						290,225
															1,054,712
			Hotels, Restaurants & Leisure 0.6%
b			Carnival Corp., senior note, 5.75%, 10/01/24			United States			557,000						850,616
			Cracker Barrel Old Country Store Inc., senior note, 0.625%, 6/15/26			United States			377,000						331,948
			Draftkings Holdings Inc., senior note, zero cpn., 3/15/28			United States			193,000						156,137
			Expedia Group Inc., senior note, zero cpn., 2/15/26			United States			669,000						608,754
			Marriott Vacations Worldwide Corp., senior note,
			3.25%, 12/15/27			United States			48,000						43,704
			zero cpn., 1/15/26			United States			815,000						751,104
			Penn Entertainment Inc., senior note, 2.75%, 5/15/26			United States			625,000						663,144
			Royal Caribbean Cruises Ltd., senior note, 6.00%, 8/15/25			United States			145,000						435,707
															3,841,114

14			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Principal Amount*						Value
			Convertible Bonds (continued)(continued)
			Independent Power & Renewable Electricity Producers 0.1%
b,d			Nextera Energy Partners LP, senior note, 144A, zero cpn., 11/15/25			United States			512,000						$461,952
			Interactive Media & Services 0.1%
			Snap Inc., senior note,
			0.75%, 8/01/26			United States			67,000						69,404
			zero cpn., 5/01/27			United States			96,000						78,991
			0.125%, 3/01/28			United States			675,000						531,469
d			144A, 0.50%, 5/01/30			United States			67,000						64,901
															744,765
			Internet & Direct Marketing Retail 0.6%
			Airbnb Inc., senior note, zero cpn., 3/15/26			United States			288,000						262,368
d			Delivery Hero SE, senior note, Reg S, 3.25%, 2/21/30			South Korea			2,000,000			EUR			2,041,450
d			Just Eat Takeaway.com NV, senior note, Reg S, 1.25%, 4/30/26			United Kingdom			600,000			EUR			596,051
b			The Realreal Inc., senior note, 1.00%, 3/01/28			United States			619,000						301,701
b			Spotify USA Inc., senior note, zero cpn., 3/15/26			United States			336,000						315,674
															3,517,244
			IT Services 0.8%
			Cloudflare Inc., senior note, zero cpn., 8/15/26			United States			912,000						815,556
			Digitalocean Holdings Inc., senior note, zero cpn., 12/01/26			United States			1,012,000						855,140
b			MongoDB Inc., senior note, 0.25%, 1/15/26			United States			928,000						1,174,152
			Okta Inc., senior note,
c			0.125%, 9/01/25			United States			528,000						498,432
			0.375%, 6/15/26			United States			607,000						552,006
			Rapid7 Inc., senior note,
			0.25%, 3/15/27			United States			48,000						42,240
d			144A, 1.25%, 3/15/29			United States			12,000						10,659
			Shift4 Payments Inc., senior note,
c			0.50%, 8/01/27			United States			178,000						164,561
b			zero cpn., 12/15/25			United States			480,000						527,856
b			Shopify Inc., senior note, 0.125%, 11/01/25			Canada			721,000						671,251
															5,311,853
			Leisure Products 0.4%
			NCL Corp. Ltd., senior note,
			5.375%, 8/01/25			United States			672,000						777,712
b			1.125%, 2/15/27			United States			772,000						691,770
			2.50%, 2/15/27			United States			326,000						302,324
d			Peloton Interactive Inc., senior note, 144A, 5.50%, 12/01/29			United States			242,000						250,654
b			Topgolf Callaway Brands Corp., senior note, 2.75%, 5/01/26			United States			558,000						626,355
															2,648,815
			Life Sciences Tools & Services 0.0%†
e			Inotiv Inc., senior note, 3.25%, 10/15/27			United States			239,000						94,384
d			Repligen Corp., senior note, 144A, 1.00%, 12/15/28			United States			12,000						11,928
															106,312
			Machinery 0.4%
			Bloom Energy Corp., senior note,
			2.50%, 8/15/25			United States			522,000						639,398
d			144A, 3.00%, 6/01/28			United States			187,000						208,982
d			144A, 3.00%, 6/01/29			United States			19,000						19,637
b			Chart Industries Inc., senior sub. note, 1.00%, 11/15/24			United States			265,000						710,763
d			Desktop Metal Inc., senior note, 144A, 6.00%, 5/15/27			United States			297,000						188,611
b			The Greenbrier Cos. Inc., senior note, 2.875%, 4/15/28			United States			567,000						646,238
															2,413,629

franklintempleton.com			Annual Report			15

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Principal Amount*						Value
			Convertible Bonds (continued)(continued)
			Media 0.3%
d			Cardlytics Inc., senior note, 144A, 4.25%, 4/01/29			United States			103,000						$87,730
			Liberty Interactive LLC,
			senior bond, 4.00%, 11/15/29			United States			424,203						146,350
			senior note, 3.75%, 2/15/30			United States			1,267,000						484,627
d			Liberty Media Corp., senior bond, 144A,
b			2.75%, 12/01/49			United States			662,000						624,266
			2.375%, 9/30/53			United States			578,000						620,483
															1,963,456
			Metals & Mining 0.2%
b			ATI Inc., senior note, 3.50%, 6/15/25			United States			284,000						1,128,048
			Century Aluminum Co., senior note, 2.75%, 5/01/28			United States			135,000						158,288
b			Ivanhoe Mines Ltd., senior note, 2.50%, 4/15/26			Canada			118,000						236,517
			SSR Mining Inc., senior bond, 2.50%, 4/01/39			Canada			29,000						25,991
															1,548,844
			Oil, Gas & Consumable Fuels 0.1%
			Enphase Energy Inc., senior note, zero cpn.,
			3/01/26			United States			413,000						382,541
			3/01/28			United States			96,000						83,386
			Green Plains Inc., senior note, 2.25%, 3/15/27			United States			326,000						295,095
d			Kosmos Energy Ltd., senior note, 144A, 3.125%, 3/15/30			Ghana			190,000						209,808
															970,830
			Personal Products 0.0%†
c,d			The Beauty Health Co., senior note, 144A, 1.25%, 10/01/26			United States			12,000						9,994
			Pharmaceuticals 0.3%
			Collegium Pharmaceutical Inc., senior note, 2.875%, 2/15/29			United States			298,000						335,548
			Innoviva Inc., senior note, 2.125%, 3/15/28			United States			588,000						523,939
			Jazz Investments I Ltd., senior note, 1.50%, 8/15/24			United States			911,000						902,346
			Pacira Biosciences Inc., senior note, 0.75%, 8/01/25			United States			326,000						305,592
c,d			144A, 2.125%, 5/15/29			United States			48,000						49,224
															2,116,649
			Professional Services 0.1%
d			CSG Systems International Inc., senior note, 144A, 3.875%, 9/15/28			United States			317,000						294,334
			Dayforce Inc., senior note, 0.25%, 3/15/26			United States			193,000						176,209
															470,543
			Real Estate Management & Development 0.1%
			Realogy Group LLC / Realogy Co.-Issuer Corp., senior note, 0.25%, 6/15/26			United States			12,000						10,013
			Redfin Corp., senior note, 0.50%, 4/01/27			United States			234,000						131,040
d			Storagevault Canada Inc., senior note, 144A, 5.00%, 3/31/28			Canada			78,000			CAD			52,078
			Zillow Group Inc., senior note, 1.375%, 9/01/26			United States			125,000						142,491
															335,622
			Semiconductors & Semiconductor Equipment 0.3%
d			ams-OSRAM AG, ., senior note, Reg S, 2.125%, 11/03/27			Austria			200,000			EUR			171,981
			Maxeon Solar Technologies Ltd., senior note, 6.50%, 7/15/25			United States			655,000						295,077
d			Microchip Technology Inc., senior note, 144A, 0.75%, 6/01/30			United States			144,000						147,477
d			MKS Instruments Inc., senior note, 144A, 1.25%, 6/01/30			United States			19,000						19,551
			SMART Global Holdings Inc., senior note, 2.00%, 2/01/29			United States			235,000						271,334
			Veeco Instruments Inc., senior note,
			3.50%, 1/15/25			United States			75,000						128,129
			3.75%, 6/01/27			United States			198,000						579,947

16			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Principal Amount*						Value
			Convertible Bonds (continued)(continued)
			Semiconductors & Semiconductor Equipment (continued) 0.3%
			2.875%, 6/01/29			United States			12,000						$18,624
															1,632,120
			Software 1.5%
d			Alarm.Com Holdings Inc., senior note, 144A, 2.25%, 6/01/29			United States			48,000						47,573
d			Blackline Inc., senior note, 144A, 1.00%, 6/01/29			United States			19,000						18,212
			Confluent Inc., senior note, zero cpn., 1/15/27			United States			241,000						204,127
			Datadog Inc., senior note, 0.125%, 6/15/25			United States			840,000						1,082,340
			Dropbox Inc., senior note, zero cpn.,
			3/01/26			United States			232,000						217,152
			3/01/28			United States			96,000						87,480
			Envestnet Inc., senior note,
			0.75%, 8/15/25			United States			480,000						462,240
			2.625%, 12/01/27			United States			192,000						211,680
			Five9 Inc., senior note,
			0.50%, 6/01/25			United States			664,000						629,472
d			144A, 1.00%, 3/15/29			United States			48,000						43,283
b,c			Guidewire Software Inc., senior note, 1.25%, 3/15/25			United States			892,000						991,904
			Hubspot Inc., senior note, 0.375%, 6/01/25			United States			574,000						1,243,284
			Jamf Holding Corp., senior note, 0.125%, 9/01/26			United States			364,000						319,519
			Microstrategy Inc., senior note,
d			144A, 0.625%, 3/15/30			United States			25,000						30,424
c,d			144A, 0.875%, 3/15/31			United States			24,000						22,356
			zero cpn., 2/15/27			United States			19,000						24,425
			Mitek Systems Inc., senior note, 0.75%, 2/01/26			United States			384,000						372,250
d			Pagerduty Inc., senior note, 144A, 1.50%, 10/15/28			United States			48,000						46,858
			Pegasystems Inc., senior note, 0.75%, 3/01/25			United States			1,184,000						1,141,968
d			Porch Group Inc., senior note, 144A, 0.75%, 9/15/26			United States			350,000						198,625
d			Progress Software Corp., senior note, 144A, 3.50%, 3/01/30			United States			48,000						47,059
			Q2 Holdings Inc., senior note,
			0.125%, 11/15/25			United States			336,000						313,992
c			0.75%, 6/01/26			United States			612,000						611,082
			Ringcentral Inc., senior note, zero cpn., 3/15/26			United States			309,000						281,499
			Verint Systems Inc., senior note, 0.25%, 4/15/26			United States			276,000						251,436
			Zscaler Inc., senior note, 0.125%, 7/01/25			United States			478,000						592,481
															9,492,721
			Specialty Retail 0.3%
			The Cheesecake Factory Inc., senior note, 0.375%, 6/15/26			United States			526,000						476,819
			National Vision Holdings Inc., senior note, 2.50%, 5/15/25			United States			179,000						175,420
			Wayfair Inc., senior note,
			1.00%, 8/15/26			United States			627,000						572,859
			A, 0.625%, 10/01/25			United States			868,000						815,920
															2,041,018
			Technology Hardware, Storage & Peripherals 0.1%
d			Seagate HDD Cayman, senior note, 144A, 3.50%, 6/01/28			United States			193,000						244,049
d			Super Micro Computer Inc., senior note, 144A, zero cpn., 3/01/29			United States			288,000						281,520
d			Western Digital Corp., senior note, 144A, 3.00%, 11/15/28			United States			24,000						38,028
															563,597
			Transportation Infrastructure 0.5%
b			Eagle Bulk Shipping Inc., senior note, 5.00%, 8/01/24			United States			1,311,000						2,990,391
			Total Convertible Bonds (Cost $74,270,966)												74,127,323

franklintempleton.com			Annual Report			17

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Country

Principal Amount*

Value

Convertible Bonds in Reorganization 0.0%†

Airlines 0.0%†

d,h

GOL Equity Finance SA, senior note, 144A, 3.75%, 7/15/24

Brazil

348,000

$60,900

Automobiles 0.0%†

d,e,h

Fisker Inc., senior note, 144A, 2.50%, 9/15/26

United States

951,000

4,850

Chemicals 0.0%†

h

Amyris Inc., senior note, zero cpn., 11/15/26

United States

1,108,000

38,780

Specialty Retail 0.0%†

d,e,h

Shift Technologies Inc., senior note, 144A, 4.75%, 5/15/26

United States

1,014,000

3,803

Total Convertible Bonds in Reorganization (Cost $2,913,186)

108,333

Corporate Bonds and Notes 5.1%

Automobiles 0.0%†

b,d

Aston Martin Capital Holdings Ltd., senior secured note, 144A, 10.00%, 3/31/29

United Kingdom

166,000

160,793

Banks 0.3%

d,i

Akbank TAS, junior sub. note, 144A, 9.369%, Perpetual

Turkey

536,000

533,192

d

Banco de Credito del Peru SA, senior note, 144A, 7.85%, 1/11/29

Peru

1,518,000

PEN

413,424

d,i

Standard Chartered PLC, junior sub. note, 144A, 7.875%, Perpetual

United Kingdom

427,000

424,782

d,i

Turkiye Vakiflar Bankasi Tao, junior sub. note, 144A, 10.117%, Perpetual

Turkey

679,000

689,239

2,060,637

Biotechnology 0.0%†

d

Cidron Aida Finco Sarl, senior secured note, Reg S, 6.25%, 4/01/28

Luxembourg

234,000

GBP

286,020

Capital Markets 0.0%†

d

Blackstone Private Credit Fund, senior note, 144A, 5.95%, 7/16/29

United States

93,000

91,548

Construction & Engineering 0.0%†

d

Infrastrutture Wireless Italiane SpA, E, senior bond, Reg S, 1.75%, 4/19/31

Italy

110,000

EUR

105,212

Diversified Consumer Services 0.0%†

d

Allied Universal Holdco LLC / Allied Universal Finance Corp., senior secured note, 144A, 6.625%, 7/15/26

United States

78,000

78,018

Diversified Financial Services 0.0%†

BlackRock TCP Capital Corp., senior note, 6.95%, 5/30/29

United States

30,000

29,562

d

Tesco Corporate Treasury Services PLC, E, senior note, Reg S, 0.375%, 7/27/29

United Kingdom

248,000

EUR

228,829

258,391

Electric Utilities 0.4%

b

Edison International, junior sub. bond,

8.125%, 6/15/53

United States

1,088,000

1,128,125

7.875%, 6/15/54

United States

1,540,000

1,577,652

2,705,777

Energy Equipment & Services 0.2%

b,d

Nabors Industries Ltd., senior note, 144A, 7.25%, 1/15/26

United States

976,000

979,132

Equity Real Estate Investment Trusts (REITs) 0.3%

b,d

Uniti Group LP / Uniti Group Finance Inc. / CSL Capital LLC, senior secured note, 144A, 10.50%, 2/15/28

United States

1,452,000

​1,453,622

d

Uniti Group LP / Uniti Group Finance Inc. / CSL Capital LLC, MAY, senior secured note, 144A, 10.50%, 2/15/28

United States

165,000

165,184

1,618,806

18			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Country

Principal Amount*

Value

Corporate Bonds and Notes (continued) 5.1%

Health Care Providers & Services 0.4%

d

Community Health Systems Inc., senior secured note, 144A,

b

5.625%, 3/15/27

United States

2,009,000

$1,904,444

10.875%, 1/15/32

United States

320,000

331,038

2,235,482

Health Care Technology 0.3%

d

Cloud Software Group Inc., senior secured note, 144A, 8.25%, 6/30/32

United States

605,000

611,487

b,d

Open Text Corp., senior secured note, 144A, 6.90%, 12/01/27

Canada

976,000

1,002,124

1,613,611

Hotels, Restaurants & Leisure 0.1%

d

Carnival Corp., senior secured note, 144A, 4.00%, 8/01/28

United States

926,000

855,289

Household Durables 0.3%

b,d

K. Hovnanian Enterprises Inc., senior secured note, 144A,

8.00%, 9/30/28

United States

500,000

503,750

11.75%, 9/30/29

United States

975,000

1,083,430

1,587,180

Internet & Direct Marketing Retail 0.3%

d

Prosus NV, senior bond, Reg S, 2.778%, 1/19/34

China

785,000

EUR

700,331

b,d

Rakuten Group Inc., senior note, 144A, 11.25%, 2/15/27

Japan

890,000

939,751

1,640,082

Leisure Products 0.3%

b,d

Life Time Inc., senior secured note, 144A, 5.75%, 1/15/26

United States

2,000,000

1,989,736

Media 0.4%

b,d

Advantage Sales & Marketing Inc., senior secured note, 144A, 6.50%, 11/15/28

United States

165,000

148,636

b

Charter Communications Operating LLC / Charter Communications Operating Capital, senior secured bond,

3.70%, 4/01/51

United States

351,000

215,038

4.40%, 12/01/61

United States

669,000

435,815

3.95%, 6/30/62

United States

562,000

334,416

b,d

Clear Channel Outdoor Holdings Inc., senior note, 144A,

7.75%, 4/15/28

United States

352,000

303,964

7.50%, 6/01/29

United States

302,000

248,244

d

CSC Holdings LLC, 144A,

senior bond, 5.75%, 1/15/30

United States

66,000

28,585

b

senior note, 11.75%, 1/31/29

United States

345,000

274,390

b,d

Gannett Holdings LLC, senior secured note, 144A, 6.00%, 11/01/26

United States

168,000

159,239

b,d

iHeartCommunications Inc., senior secured note, 144A,

5.25%, 8/15/27

United States

124,000

68,626

4.75%, 1/15/28

United States

171,000

90,561

d,k

Univision Communications Inc., senior secured note, 144A, 8.50%, 7/31/31

United States

104,000

102,356

2,409,870

Metals & Mining 0.0%†

d

We Soda Investments Holding PLC, senior secured note, 144A, 9.50%, 10/06/28

Turkey

252,000

259,096

Oil, Gas & Consumable Fuels 0.7%

Ecopetrol SA, senior bond, 8.375%, 1/19/36

Colombia

1,059,000

1,035,527

b

Energy Transfer LP, junior sub. bond, 8.00%, 5/15/54

United States

472,000

491,736

b,d

Moss Creek Resources Holdings Inc., senior note, 144A, 10.50%, 5/15/27

United States

843,000

​863,324

franklintempleton.com			Annual Report			19

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Country

Principal Amount*

Value

Corporate Bonds and Notes (continued) 5.1%

Oil, Gas & Consumable Fuels (continued) 0.7%

Petroleos Mexicanos, senior bond, 6.35%, 2/12/48

Mexico

1,502,000

$972,932

b,d

Vital Energy Inc., senior note, 144A, 7.875%, 4/15/32

United States

498,000

505,986

d

Yinson Boronia Production BV, senior secured bond, 144A, 8.947%, 7/31/42

Brazil

379,000

382,790

d

YPF Sociedad Anonima,

senior note, Reg S, 8.50%, 3/23/25

Argentina

79,000

78,985

senior secured note, 144A, 9.50%, 1/17/31

Argentina

379,000

383,372

4,714,652

Pharmaceuticals 0.3%

d

Bausch Health Cos. Inc., 144A,

senior bond, 7.25%, 5/30/29

United States

163,000

90,707

senior bond, 5.25%, 1/30/30

United States

33,000

16,873

senior bond, 5.25%, 2/15/31

United States

54,000

27,210

senior note, 6.25%, 2/15/29

United States

344,000

184,470

b

senior secured note, 5.50%, 11/01/25

United States

1,299,000

1,226,314

senior secured note, 6.125%, 2/01/27

United States

54,000

44,894

senior secured note, 11.00%, 9/30/28

United States

77,000

67,375

1,657,843

Software 0.1%

b,d

Alteryx Inc., senior note, 144A, 8.75%, 3/15/28

United States

410,000

420,995

Specialty Retail 0.2%

b,d,j

Carvana Co., senior secured note, 144A, PIK, 14.00%, 6/01/31

United States

384,507

405,571

b,d

Guitar Center Inc., senior secured note, 144A, 8.50%, 1/15/26

United States

598,000

539,408

d

Mitchells & Butlers Finance PLC, B2, senior secured bond, Reg S, 6.013%, 12/15/28

United Kingdom

422,672

GBP

520,700

1,465,679

Telecommunications 0.3%

America Movil SAB de CV, senior note,

10.125%, 1/22/29

Mexico

10,830,000l

MXN

623,157

9.50%, 1/27/31

Mexico

18,830,000l

MXN

1,046,018

1,669,175

Transportation 0.1%

b

Canadian Pacific Railway Co., senior bond, 2.45%, 12/02/31

Canada

982,000

887,450

Total Corporate Bonds and Notes (Cost $31,082,215)

​31,750,474

Corporate Bonds and Notes in Reorganization 0.1%

Diversified Telecommunication Services 0.0%†

d,h,j

Ligado Networks LLC, senior secured note, 144A, PIK, 15.50%, 7/07/24

United States

1,339,350

200,903

Metals & Mining 0.1%

a,d,h,j

Samarco Mineracao SA, senior note, 144A, PIK, 9.50%, 6/30/31

Brazil

572,913

536,075

Real Estate Management & Development 0.0%†

d,h

Kaisa Group Holdings Ltd., Reg S,

senior note, 11.95%, 10/22/22

China

399,000

13,466

senior secured note, 8.50%, 6/30/22

China

420,000

14,175

senior secured note, 11.25%, 4/16/25

China

537,000

18,124

h

Zhenro Properties Group Ltd., senior note,

8.00%, 3/06/23

China

981,000

6,131

d

Reg S, 6.63%, 1/07/26

China

203,000

1,827

53,723

Total Corporate Bonds and Notes in Reorganization (Cost $1,491,409)

​790,701

20			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Country

Principal Amount*

Value

m,n

Senior Floating Rate Interests 1.5%

Chemicals 0.2%

ASP Unifrax Holdings Inc., First Lien Term Loan, 9.202%, (1-Month USD LIBOR + 3.75%), 12/12/25

United States

700,073

$681,696

o

Curia Global Inc., Term Loan RC, 9.177%, (1-Month USD LIBOR + 3.85%), 8/30/26

United States

369,778

349,511

1,031,207

Communications Equipment 0.2%

o

Commscope Holding Co. Inc., Initial Term Loan, 8.694%, (1-Month USD LIBOR + 3.25%), 4/06/26

United States

1,735,756

1,563,048

j

Riverbed Technology Inc., Exit Term Loan, PIK, 9.809%, (1-Month SOFR + 4.50%), 7/01/28

United States

56,775

34,987

1,598,035

Construction Materials 0.0%†

o

Oldcastle BuildingEnvelope Inc., Term Loan RC, 8.407%, (1-Month SOFR + 3.75%), 4/29/27

United States

27,687

25,472

Diversified Telecommunication Services 0.0%†

e

Ligado Networks LLC, Bank Debt Term Loan, 17.50%, 7/07/24

United States

35,197

28,686

Energy - Alternate Sources 0.1%

Enviva Inc., Term Loan RC, 12.25%, (SOFR + 2.25%), 6/30/27

United States

431,000

439,620

Food & Staples Retailing 0.4%

o

H-Food Holdings LLC,

Initial Term Loan, 9.296%, (1-Month SOFR + 3.95%), 5/23/25

United States

324,743

229,638

Incremental Term Loan B-3, 10.609%, (1-Month USD LIBOR + 5.58%), 5/23/25

United States

16,860

11,923

o

Upfield Group BV, Term Loan RC, 8.098%, (3-Month EURIBOR + 3.00%), 10/02/27

Netherlands

87,446

94,242

Wm Morrison Supermarkets Ltd., Facility Term Loan B2, 10.817%, (5-Day SONIA + 5.61%), 11/04/27

United Kingdom

1,550,000

1,947,230

2,283,033

Leisure Products 0.0%†

o

Hercules Achievement Inc., Initial Term Loan, 10.444%, (1-Month SOFR + 5.11%), 12/15/26

United States

134,750

135,986

Media 0.3%

o

CSC Holdings LLC, Term Loan B, 9.817%, (1-Month SOFR + 4.50%), 1/18/28

United States

1,456,062

1,404,845

o

Radiate Holdco LLC, Amendment No. 6 New Term Loan, 8.694%, (1-Month USD LIBOR + 3.25%), 9/25/26

United States

742,103

588,002

1,992,847

Pharmaceuticals 0.1%

o

Bausch Health Cos. Inc., Term Loan B, 10.675%, (1-Month SOFR + 5.35%), 2/01/27

United States

1,008,628

915,960

Software 0.2%

Polaris Newco LLC, First Lien Dollar Term Loan, 9.591%, (1-Month USD LIBOR + 4.00%), 6/02/28

United States

1,014,790

1,016,601

Total Senior Floating Rate Interests (Cost $9,195,059)

9,467,447

Foreign Government and Agency Securities 2.0%

d

Government of Angola, senior bond, Reg S,

8.75%, 4/14/32

Angola

435,000

391,135

9.375%, 5/08/48

Angola

537,000

460,050

Government of Argentina, senior bond, 3.625%, 7/09/46

Argentina

1,341,000

611,017

franklintempleton.com			Annual Report			21

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Country

Principal Amount*

Value

Foreign Government and Agency Securities (continued) 2.0%

Government of Colombia, senior bond,

B, 7.00%, 6/30/32

Colombia

3,525,100,000

COP

$733,363

B, 13.25%, 2/09/33

Colombia

2,527,700,000

COP

738,977

8.00%, 11/14/35

Colombia

200,000

204,408

B, 7.25%, 10/26/50

Colombia

2,539,400,000

COP

424,881

d

Government of Dominican Republic, senior bond, 144A, 11.25%, 9/15/35

Dominican Republic

11,150,000

DOP

199,323

e

Government of Egypt, senior note, zero cpn., 12/10/24

Egypt

67,100,000

EGP

1,154,496

d

Government of El Salvador, senior note, 144A, 9.25%, 4/17/30

El Salvador

310,000

272,073

d

Government of Germany, senior bond, Reg S,2/15/32

Germany

155,660

EUR

138,748

1.70%, 8/15/32

Germany

547,200

EUR

554,922

Government of Indonesia, senior bond, 7.125%, 6/15/38

Indonesia

14,646,000,000

IDR

914,636

b

Government of Italy, senior note, 2.375%, 10/17/24

Italy

350,000

345,624

d

Government of Ivory Coast, senior bond, 144A, 8.25%, 1/30/37

Ivory Coast

648,000

632,753

d

Government of Pakistan, senior note, Reg S, 6.00%, 4/08/26

Pakistan

618,000

562,077

d

Government of Paraguay, senior note, 144A, 7.90%, 2/09/31

Paraguay

928,000,000

PYG

127,776

d

Government of Peru, senior bond, Reg S, 7.30%, 8/12/33

Peru

2,393,000

PEN

653,599

d

Government of Romania, senior note, Reg S, 6.625%, 9/27/29

Romania

216,000

EUR

253,907

Government of South Africa, 2037, senior bond, 8.50%, 1/31/37

South Africa

9,609,496

ZAR

380,518

d

Government of Tunisian Republic, senior note, Reg S, 6.375%, 7/15/26

Tunisia

850,000

EUR

780,609

Government of Turkey, senior note,

31.08%, 11/08/28

Turkey

5,371,000

TRY

170,848

26.20%, 10/05/33

Turkey

8,624,000

TRY

266,027

Government of Uruguay, senior bond, 9.75%, 7/20/33

Uruguay

9,758,140

UYU

260,799

d

Government of Uzbekistan, senior note, 144A, 6.90%, 2/28/32

Uzbekistan

310,000

303,112

d

Istanbul Metropolitan Municipality, senior note, 144A, 10.50%, 12/06/28

Turkey

259,000

278,776

d

Provincia de Buenos Aires, senior bond, Reg S, 6.375%, 9/01/37

Argentina

2,469,736

1,095,946

Total Foreign Government and Agency Securities (Cost $11,868,947)

​12,910,400

n

Foreign Government and Agency Securities in Reorganization 0.6%

h,p

Government of Argentina, senior bond, FRN, zero cpn., 12/15/35

Argentina

7,422,000

273,000

d,h

Government of Ghana, Reg S,

senior bond, 10.75%, 10/14/30

Ghana

207,000

141,838

senior bond, 8.95%, 3/26/51

Ghana

200,000

103,286

senior bond, 8.75%, 3/11/61

Ghana

648,000

335,165

senior note, 6.375%, 2/11/27

Ghana

281,000

144,376

d,h

Government of Sri Lanka, senior bond, Reg S, 7.55%, 3/28/30

Sri Lanka

680,000

396,106

d,h

Government of Ukraine,

senior bond, Reg S, 7.75%, 9/01/26

Ukraine

704,000

213,970

p

senior bond, FRN, Reg S, 7.75%, 8/01/41

Ukraine

3,212,000

1,673,693

senior note, Reg S, 8.994%, 2/01/26

Ukraine

440,000

141,161

h

Government of Venezuela, senior bond, 9.25%, 9/15/27

Venezuela

624,000

​122,013

d,h

Government of Venezuela, senior bond, Reg S, 9.25%, 5/07/28

Venezuela

684,000

117,378

Total Foreign Government and Agency Securities in Reorganization (Cost $2,730,435)

​3,661,986

U.S. Government and Agency Securities 1.5%

U.S. Treasury Bond,

4.50%, 2/15/44

United States

206,000

199,965

4.75%, 11/15/53

United States

118,500

120,759

4.25%, 2/15/54

United States

43,000

40,343

U.S. Treasury Note,

4.625%, 2/28/26

United States

561,000

558,020

4.125%, 3/31/29

United States

187,000

183,866

22			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Country

Principal Amount*

Value

U.S. Government and Agency Securities (continued) 1.5%

4.625%, 4/30/29

United States

1,234,200

$ 1,240,371

4.00%, 2/15/34

United States

6,399,000

​6,153,538

4.375%, 5/15/34

United States

1,172,000

1,161,653

Total U.S. Government and Agency Securities (Cost $9,745,511)

9,658,515

						Number of Contracts			Notional Amount#
			Options Purchased 0.1%
			Calls - Exchange-Traded 0.0%†
			Albertsons Cos Inc., January Strike Price $22.00, Expires 1/17/25			249			513,936						37,350
			Arcadium Lithium PLC, June Strike Price $5.00, Expires 6/21/24			12			5,316						60
			Arcadium Lithium PLC, July Strike Price $5.00, Expires 7/19/24			19			8,417						380
			Capri Holdings Ltd., October Strike Price $55.00, Expires 10/18/24			98			338,590						980
			Coherus Biosciences Inc., November Strike Price $3.00, Expires 11/15/24			28			5,096						700
			CommScope Holding Co Inc., January Strike Price $1.50, Expires 1/17/25			293			42,192						15,236
			Constellation Energy Corp., January Strike Price $260.00, Expires 1/17/25			38			825,550						49,704
			Enphase Energy Inc., June Strike Price $120.00, Expires 6/21/24			1			12,790						1,100
			Expedia Group Inc., July Strike Price $150.00, Expires 7/19/24			2			22,572						10
			Gildan Activewear Inc., June Strike Price $40.00, Expires 6/21/24			90			344,430						2,925
			Global X Uranium ETF, January Strike Price $45.00, Expires 1/17/25			277			893,048						33,240
			Golar LNG Ltd., January Strike Price $25.00, Expires 1/17/25			37			97,273						12,580
			Ironwood Pharmaceuticals Inc., August Strike Price $7.50, Expires 8/16/24			10			6,300						200
			Match Group Inc., June Strike Price $32.00, Expires 6/28/24			17			52,071						544
			Maxeon Solar Technologies Ltd., June Strike Price $3.50, Expires 6/21/24			58			10,904						812
			Maxeon Solar Technologies Ltd., June Strike Price $4.00, Expires 6/21/24			77			14,476						1,155
			Maxeon Solar Technologies Ltd., June Strike Price $4.50, Expires 6/21/24			58			10,904						3,045
			Norwegian Cruise Line Holdings Ltd., June Strike Price $18.00, Expires 6/21/24			19			214,434						285
			Norwegian Cruise Line Holdings Ltd., July Strike Price $24.00, Expires 7/19/24			12			19,920						36
			OPKO Health Inc., June Strike Price $1.00, Expires 6/21/24			58			7,946						2,320
			Shift4 Payments Inc., June Strike Price $75.00, Expires 6/21/24			16			107,648						1,160
			Shift4 Payments Inc., June Strike Price $90.00, Expires 6/21/24			4			26,912						290
			Shift4 Payments Inc., July Strike Price $90.00, Expires 7/19/24			17			114,376						357
			United States Steel Corp., January Strike Price $57.50, Expires 1/17/25			10			38,350						80
															164,549
			Puts - Exchange-Traded 0.1%
			Bloom Energy Corp., June Strike Price $11.00, Expires 6/21/24			19			31,008						171
			Bloom Energy Corp., June Strike Price $12.00, Expires 6/21/24			29			47,328						290
			Bloom Energy Corp., June Strike Price $13.00, Expires 6/21/24			19			31,008						237
			Golar LNG Ltd., June Strike Price $24.00, Expires 6/21/24			47			123,563						588
			Hess Corp., June Strike Price $100.00, Expires 6/21/24			13			200,330						65
			Hollysys Automation Technologies Ltd., July Strike Price $20.00, Expires 7/19/24			5			10,585						875
			Inotiv Inc., July Strike Price $5.00, Expires 7/19/24			21			3,927						6,457
			Liberty Media Corp., August Strike Price $22.00, Expires 8/16/24			102			231,132						10,710
			Lincoln National Corp., January Strike Price $17.50, Expires 1/17/25			256			844,544						6,400

franklintempleton.com			Annual Report			23

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Number of Contracts			Notional Amount#						Value
			Options Purchased (continued)
			Puts - Exchange-Traded (continued)
			Maxeon Solar Technologies Ltd., June Strike Price $3.00, Expires 6/21/24			64			12,032						$9,600
			Maxeon Solar Technologies Ltd., July Strike Price $1.50, Expires 7/19/24			45			8,460						4,725
			Maxeon Solar Technologies Ltd., July Strike Price $2.50, Expires 7/19/24			576			108,288						118,080
			OPKO Health Inc., June Strike Price $1.00, Expires 6/21/24			116			15,892						580
			Sirius XM Holdings Inc., September Strike Price $5.00, Expires 9/20/24			319			89,958						63,641
			Snap Inc., June Strike Price $14.00, Expires 6/21/24			19			28,538						361
			SPDR S&P 500 ETF Trust, June Strike Price $521.00, Expires 6/21/24			157			8,279,709						51,653
			Spirit Airlines Inc., September Strike Price $3.00, Expires 9/20/24			120			43,800						6,120
			Spirit Airlines Inc., September Strike Price $3.50, Expires 9/20/24			180			65,700						13,950
			United Rentals Inc., June Strike Price $600.00, Expires 6/21/24			18			1,204,938						9,486
			United Rentals Inc., September Strike Price $550.00, Expires 9/20/24			6			401,646						7,410
			United States Steel Corp., June Strike Price $32.00, Expires 6/21/24			80			306,800						2,240
			US Global Jets ETF, September Strike Price $18.00, Expires 9/20/24			337			675,011						14,154
															327,793
			Total Options Purchased (Cost $541,927)												492,342
			Total Investments before Short Term Investments (Cost $244,009,878)												272,077,958

Country

Shares

Short Term Investments 45.2%

Money Market Funds 34.6%

q,r

Dreyfus Government Cash Management, Institutional, 5.20%

United States

121,818,128

121,818,128

q

Fidelity Investments Money Market Government Portfolio, Institutional, 5.21%

United States

97,874,468

97,874,468

Total Money Market Funds (Cost $219,692,596)

219,692,596

s

Investments from Cash Collateral Received for Loaned Securities (Cost $882,000) 0.2%

q,t

Institutional Fiduciary Trust Money Market Portfolio, 5.00%

United States

882,000

882,000

									Principal Amount*
			U.S. Government and Agency Securities 10.4%
u			U.S. Treasury Bill, zero cpn.,
			6/04/24			United States			29,000,000						28,995,778
			6/06/24			United States			3,000,000						2,998,689
			11/14/24			United States			35,000,000						34,176,988
			Total U.S. Government and Agency Securities (Cost $66,151,151)												66,171,455
			Total Short Term Investments (Cost $286,725,747)												​286,746,051
			Total Investments (Cost $530,735,625) 88.1%												558,824,010
			Options Written (0.1)%												(653,981)
			Securities Sold Short (16.6)%												(105,141,373)
			Other Assets, less Liabilities 28.6%												181,641,287
			Net Assets 100.0%												$634,669,943

24			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Number of Contracts			Notional Amount#						Value
v			Options Written (0.1)%
			Calls - Exchange-Traded (0.1)%
			Albertsons Cos Inc., A, January Strike Price $27.00, Expires 1/17/25			249			513,936						$(4,980)
			Capri Holdings Ltd., October Strike Price $57.50, Expires 10/18/24			98			338,590						(490)
			Golar LNG Ltd., January Strike Price $30.00, Expires 1/17/25			37			97,273						(5,180)
			Liberty Media Corp., June Strike Price $26.00, Expires 6/21/24			64			145,024						(960)
			Shift4 Payments Inc., July Strike Price $100.00, Expires 7/19/24			17			114,376						(680)
			United States Steel Corp., January Strike Price $52.50, Expires 1/17/25			10			38,350						(600)
			Vertiv Holdings Co., July Strike Price $50.00, Expires 7/19/24			135			1,323,945						(607,500)
															(620,390)
			Puts - Exchange-Traded (0.0)%†
			Coherus Biosciences Inc., November Strike Price $2.00, Expires 11/15/24			32			5,824						(2,480)
			Okta Inc., July Strike Price $16.00, Expires 7/19/24			12			106,416						(708)
			Shift4 Payments Inc., June Strike Price $60.00, Expires 6/21/24			13			87,464						(871)
			Sirius XM Holdings Inc., September Strike Price $3.00, Expires 9/20/24			319			89,958						(15,153)
			SPDR S&P 500 ETF Trust, June Strike Price $504.00, Expires 6/21/24			157			8,279,709						(13,659)
			United States Steel Corp., July Strike Price $25.00, Expires 7/19/24			45			172,575						(720)
															(33,591)
			Total Options Written (Premiums Received $166,953)												(653,981)

						Country			Shares/ Warrants
w			Securities Sold Short (16.6)%
			Exchange Traded Funds (5.6)%
			ARK Innovation ETF			United States			9,006						(382,305)
			Health Care Select Sector SPDR Fund			United States			57,572						(8,273,096)
			iShares PHLX Semiconductor ETF			United States			4,341						(1,015,838)
			iShares U.S. Healthcare Providers ETF			United States			90,087						(4,744,882)
			iShares U.S. Medical Devices ETF			United States			141,442						(7,854,274)
			iShares U.S. Pharmaceuticals ETF			United States			95,662						(6,288,820)
			SPDR S&P Biotech ETF			United States			78,380						(6,986,009)
			Total Exchange Traded Funds (Proceeds $35,261,925)												(35,545,224)
			Common Stocks (6.3)%
			Aerospace & Defense (0.1)%
			Parsons Corp.			United States			5,997						(456,672)
			Rocket Lab USA Inc.			United States			3,835						(16,759)
															(473,431)
			Automobile Components (0.0)%†
			LCI Industries			United States			1,243						(136,581)
			Mobileye Global Inc., A			Israel			6,918						(177,516)
															(314,097)
			Automobiles (0.0)%†
			Rivian Automotive Inc., A			United States			13,214						(144,297)
			Tesla Inc.			United States			752						(133,916)
			Winnebago Industries Inc.			United States			69						(4,281)
															(282,494)
			Biotechnology (0.5)%
			Apellis Pharmaceuticals Inc.			United States			3,418						(134,156)
			Cerevel Therapeutics Holdings Inc.			United States			4,959						(202,030)
			Coherus Biosciences Inc.			United States			16,953						(30,854)
			Cytokinetics Inc.			United States			4,066						(197,242)
			Dynavax Technologies Corp.			United States			81,937						(982,425)

franklintempleton.com			Annual Report			25

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Shares/ Warrants						Value
			Securities Sold Short (continued)
			Common Stocks (continued)
			Biotechnology (continued)
			Halozyme Therapeutics Inc.			United States			916						$(40,570)
			Ironwood Pharmaceuticals Inc., A			United States			437						(2,753)
			Karyopharm Therapeutics Inc.			United States			4,289						(4,156)
			Mannkind Corp.			United States			74,760						(349,129)
			Mirum Pharmaceuticals Inc.			United States			526						(12,640)
			Natera Inc.			United States			9,901						(1,054,754)
			Travere Therapeutics Inc.			United States			8,076						(59,924)
															(3,070,633)
			Broadline Retail (0.1)%
			Alibaba Group Holding Ltd., ADR			China			5,943						(465,575)
			Etsy Inc.			United States			1,454						(92,285)
			JD.Com Inc., ADR			China			101						(2,992)
															(560,852)
			Building Products (0.1)%
			Carrier Global Corp.			United States			9,967						(629,815)
			Capital Markets (0.2)%
			Ares Capital Corp.			United States			25,318						(546,109)
			Blue Owl Capital Corp.			United States			19,138						(322,667)
			Coinbase Global Inc., A			United States			492						(111,153)
			Oaktree Specialty Lending Corp.			United States			11,473						(223,953)
			Wisdomtree Inc.			United States			11,828						(117,925)
															(1,321,807)
			Chemicals (0.2)%
			Air Products & Chemicals Inc.			United States			1,951						(520,332)
			Albemarle Corp.			United States			4,762						(583,773)
			Arcadium Lithium PLC			United Kingdom			95,305						(422,201)
			Danimer Scientific Inc.			United States			17,596						(13,720)
e			Danimer Scientific Inc., 7/15/25, wts.			United States			5,865						—
			Purecycle Technologies Inc.			United States			1,619						(8,403)
															(1,548,429)
			Communications Equipment (0.0)%†
			Viavi Solutions Inc.			United States			3,433						(25,816)
			Construction & Engineering (0.0)%†
			Centuri Holdings Inc.			United States			3,120						(85,644)
			Granite Construction Inc.			United States			468						(29,152)
															(114,796)
			Consumer Finance (0.2)%
			Encore Capital Group Inc.			United States			10,040						(444,169)
			EZCORP Inc., A			United States			40,140						(421,069)
			SoFi Technologies Inc.			United States			24,699						(170,423)
															(1,035,661)
			Consumer Staples Distribution & Retail (0.0)%†
			The Chefs’ Warehouse Inc.			United States			5,161						(203,447)
			Diversified Financial Services (0.1)%
			Bread Financial Holdings Inc.			United States			8,742						(365,066)
			Electric Utilities (0.1)%
			Avangrid Inc.			United States			3,570						(128,556)
			NRG Energy Inc.			United States			6,147						(497,907)
															(626,463)

26			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Shares/ Warrants						Value
			Securities Sold Short (continued)
			Common Stocks (continued)
			Electrical Equipment (0.1)%
			Bloom Energy Corp., A			United States			28,010						$(457,123)
			Plug Power Inc.			United States			57,716						(192,194)
															(649,317)
			Electronic Equipment, Instruments & Components (0.0)%†
			Hollysys Automation Technologies Ltd.			China			1,604						(33,957)
			PAR Technology Corp.			United States			3,888						(173,483)
			Vishay Intertechnology Inc.			United States			1,245						(29,419)
															(236,859)
			Energy Equipment & Services (0.1)%
			Transocean Ltd.			United States			150,436						(932,703)
			Entertainment (0.2)%
			Live Nation Entertainment Inc.			United States			4,335						(406,363)
			The Marcus Corp.			United States			17,290						(184,139)
			Sea Ltd., ADR			Singapore			5,525						(373,048)
			Sphere Entertainment Co.			United States			1,242						(45,333)
			Spotify Technology SA			United States			176						(52,233)
															(1,061,116)
			Financial Services (0.0)%†
			Block Inc., A			United States			625						(40,050)
			Repay Holdings Corp., A			United States			1,395						(13,587)
			Shift4 Payments Inc., A			United States			3,532						(237,633)
															(291,270)
			Ground Transportation (0.0)%†
			Lyft Inc., A			United States			1,724						(26,912)
			Uber Technologies Inc.			United States			576						(37,186)
															(64,098)
			Health Care Equipment & Supplies (0.4)%
			CONMED Corp.			United States			878						(67,114)
			Glaukos Corp.			United States			10,595						(1,194,268)
			Haemonetics Corp.			United States			172						(14,462)
			Insulet Corp.			United States			1,220						(216,172)
			iRhythm Technologies Inc.			United States			287						(25,316)
			Lantheus Holdings Inc.			United States			1,768						(144,676)
			Tandem Diabetes Care Inc.			United States			12,201						(625,057)
			Varex Imaging Corp.			United States			8,187						(126,489)
															(2,413,554)
			Health Care Providers & Services (0.0)%†
			NeoGenomics Inc.			United States			1,349						(18,495)
			OPKO Health Inc.			United States			142,382						(195,063)
			PetIQ Inc., A			United States			4,355						(90,410)
															(303,968)
			Health Care Technology (0.0)%†
			Evolent Health Inc., A			United States			4,482						(94,973)
			Health Catalyst Inc.			United States			717						(4,754)
															(99,727)
			Hotel & Resort REITs (0.0)%†
			Pebblebrook Hotel Trust			United States			12,124						(171,554)
			Summit Hotel Properties Inc.			United States			8,014						(49,046)
															(220,600)
			Hotels, Restaurants & Leisure (0.4)%
			Airbnb Inc., A			United States			179						(25,942)

franklintempleton.com			Annual Report			27

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Shares/ Warrants						Value
			Securities Sold Short (continued)
			Common Stocks (continued)
			Hotels, Restaurants & Leisure (continued)
			Carnival Corp.			United States			54,907						$(827,998)
			The Cheesecake Factory Inc.			United States			1,238						(47,638)
			Draftkings Inc., A			United States			707						(24,837)
			Expedia Group Inc.			United States			190						(21,443)
			Marriott Vacations Worldwide Corp.			United States			960						(86,659)
			Norwegian Cruise Line Holdings Ltd.			United States			40,841						(677,961)
			Penn National Gaming Inc.			United States			13,194						(230,895)
			Royal Caribbean Cruises Ltd.			United States			2,866						(423,251)
															(2,366,624)
			Industrial Conglomerates (0.2)%
			Honeywell International Inc.			United States			6,719						(1,358,515)
			Interactive Media & Services (0.0)%†
			Match Group Inc.			United States			504						(15,437)
			Snap Inc., A			United States			7,499						(112,635)
															(128,072)
			IT Services (0.1)%
			Cloudflare Inc., A			United States			951						(64,373)
			Digitalocean Holdings Inc.			United States			317						(11,745)
			MongoDB Inc., A			United States			3,189						(752,795)
			Okta Inc., A			United States			434						(38,487)
			Shopify Inc., A			Canada			270						(15,971)
															(883,371)
			Leisure Products (0.1)%
			Topgolf Callaway Brands Corp.			United States			19,768						(309,369)
			Life Sciences Tools & Services (0.0)%†
			Inotiv Inc.			United States			2,892						(5,408)
			Repligen Corp.			United States			38						(5,665)
															(11,073)
			Machinery (0.3)%
			Chart Industries Inc.			United States			4,496						(706,007)
			Desktop Metal Inc., A			United States			161,776						(91,193)
			The Greenbrier Cos. Inc.			United States			7,737						(427,469)
			Illinois Tool Works Inc.			United States			1,736						(421,414)
															(1,646,083)
			Marine Transportation (0.5)%
			Star Bulk Carriers Corp.			Greece			109,143						(2,955,592)
			Media (0.0)%†
			Cardlytics Inc.			United States			4,755						(41,654)
			Metals & Mining (0.2)%
			ATI Inc.			United States			18,268						(1,120,559)
			Century Aluminum Co.			United States			6,724						(123,251)
			Ivanhoe Mines Ltd., A			Canada			16,364						(236,284)
			SSR Mining Inc.			Canada			365						(1,949)
															(1,482,043)
			Multi-Utilities (0.4)%
			DTE Energy Co.			United States			8,048						(937,833)
			Public Service Enterprise Group Inc.			United States			13,702						(1,038,064)
			WEC Energy Group Inc.			United States			9,390						(760,872)
															(2,736,769)
			Oil, Gas & Consumable Fuels (0.3)%
			Chevron Corp.			United States			1,397						(226,733)
			Green Plains Inc.			United States			4,842						(83,137)

28			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Shares/ Warrants						Value
			Securities Sold Short (continued)
			Common Stocks (continued)
			Oil, Gas & Consumable Fuels (continued)
			Kinder Morgan Inc.			United States			16,881						$(329,011)
			Kosmos Energy Ltd.			Ghana			20,920						(127,612)
			TC Energy Corp.			Canada			14,071						(542,626)
			The Williams Cos. Inc.			United States			9,394						(389,945)
															(1,699,064)
			Passenger Airlines (0.1)%
			American Airlines Group Inc.			United States			198						(2,277)
			Cathay Pacific Airways Ltd.			Hong Kong			333,000						(349,281)
															(351,558)
			Pharmaceuticals (0.1)%
			Collegium Pharmaceutical Inc.			United States			6,407						(212,328)
			Innoviva Inc.			United States			10,629						(167,832)
			Pacira Biosciences Inc.			United States			1,074						(32,574)
															(412,734)
			Professional Services (0.0)%†
			CSG Systems International Inc.			United States			1,887						(81,424)
			Dayforce Inc.			United States			67						(3,314)
															(84,738)
			Real Estate Management & Development (0.0)%†
			Anywhere Real Estate Inc.			United States			84						(342)
			Redfin Corp.			United States			1,242						(7,999)
			Storagevault Canada Inc.			Canada			3,105						(10,274)
			Zillow Group Inc., C			United States			1,666						(68,223)
															(86,838)
			Semiconductors & Semiconductor Equipment (0.2)%
			Enphase Energy Inc.			United States			493						(63,055)
			Maxeon Solar Technologies Ltd.			United States			36,004						(67,687)
			Microchip Technology Inc.			United States			564						(54,838)
			MKS Instruments Inc.			United States			87						(11,013)
			SMART Global Holdings Inc.			United States			8,670						(178,429)
			Veeco Instruments Inc.			United States			16,948						(688,936)
															(1,063,958)
			Software (0.6)%
			Alarm.Com Holdings Inc.			United States			334						(21,847)
			Blackline Inc.			United States			92						(4,390)
			Confluent Inc., A			United States			386						(10,024)
			Datadog Inc., A			United States			7,141						(786,795)
			Dropbox Inc., A			United States			1,217						(27,419)
			Envestnet Inc.			United States			2,102						(137,702)
			Five9 Inc.			United States			369						(17,255)
			Guidewire Software Inc.			United States			4,952						(564,132)
			HubSpot Inc.			United States			1,990						(1,215,990)
			Jamf Holding Corp.			United States			566						(9,011)
			Microstrategy Inc., A			United States			33						(50,308)
			Mitek Systems Inc.			United States			6,511						(81,713)
			Pagerduty Inc.			United States			1,052						(19,957)
			Porch Group Inc.			United States			9,055						(19,016)
			Progress Software Corp.			United States			339						(17,170)
			Q2 Holdings Inc.			United States			3,487						(212,079)
			Rapid7 Inc.			United States			160						(5,782)
			Verint Systems Inc.			United States			696						(20,643)

franklintempleton.com			Annual Report			29

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Shares/ Warrants						Value
			Securities Sold Short (continued)
			Common Stocks (continued)
			Software (continued)
			Zscaler Inc.			United States			2,218						$(376,971)
															(3,598,204)
			Specialty Retail (0.0)%†
			National Vision Holdings Inc.			United States			325						(4,904)
			Wayfair Inc., A			United States			1,371						(81,561)
															(86,465)
			Technology Hardware, Storage & Peripherals (0.1)%
			Seagate Technology Holdings PLC			United States			1,741						(162,331)
			Super Micro Computer Inc.			United States			153						(120,030)
			Western Digital Corp.			United States			410						(30,869)
															(313,230)
			Textiles, Apparel & Luxury Goods (0.0)%†
			Capri Holdings Ltd.			United States			2,008						(69,376)
			Water Utilities (0.2)%
			American Water Works Co. Inc.			United States			7,590						(992,544)
			Total Common Stocks (Proceeds $43,093,341)												(39,523,893)
			Preferred Stocks (Proceeds $216,578) (0.0)%†
			Automobiles (0.0)%†
			Volkswagen AG, pfd., 2.08%			Germany			1,634						(205,331)

Principal Amount*

Convertible Bonds (Proceeds $56,790) (0.0)%†

Passenger Airlines (0.0)%†

Jetblue Airways Corp., senior note, 0.50%, 4/01/26

United States

66,000

(58,190)

Corporate Bonds and Notes (3.2)%

Aerospace & Defense (0.2)%

The Boeing Co., senior bond,

3.60%, 5/01/34

United States

698,000

(556,244)

3.25%, 2/01/35

United States

623,000

(470,917)

(1,027,161)

Automobile Components (0.1)%

d

Adient Global Holdings Ltd., senior note, 144A, 8.25%, 4/15/31

United States

622,000

(648,443)

Automobiles (0.1)%

d,p

Rivian Automotive Inc., senior secured note, 144A, FRN, 11.31%, (6-Month SOFR + 6.03%), 10/15/26

United States

374,000

(369,549)

Banks (0.4)%

First Horizon Bank, junior sub. bond, 5.75%, 5/01/30

United States

767,000

(728,612)

d,i

Industrial & Commercial Bank of China Ltd., junior sub. note, Reg S, 3.2% to 9/24/26, FRN thereafter, Perpetual

China

761,000

(721,961)

KeyBank NA, senior note, 4.90%, 8/08/32

United States

1,298,000

(1,149,165)

(2,599,738)

Building Products (0.2)%

d

Ameritex Holdco Intermediate LLC, senior secured note, 144A, 10.25%, 10/15/28

United States

969,000

(1,016,794)

d

Oscar AcquisitionCo LLC / Oscar Finance Inc., senior note, 144A, 9.50%, 4/15/30

United States

96,000

(91,655)

(1,108,449)

Commercial Services & Supplies (0.0)%†

d

Sotheby's, senior secured note, 144A, 7.375%, 10/15/27

United States

171,000

(149,005)

30			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

						Country			Principal Amount*						Value
			Securities Sold Short (continued)
			Corporate Bonds and Notes (continued)
			Communications Equipment (0.2)%
d			Equipmentshare.Com Inc., senior secured note, 144A, 9.00%, 5/15/28			United States			1,414,000						$(1,460,573)
			Construction Materials (0.2)%
d			Camelot Return Merger Sub Inc., senior secured note, 144A, 8.75%, 8/01/28			United States			989,000						(979,488)
			Consumer Finance (0.1)%
			Ally Financial Inc., junior sub. bond, 5.75%, 11/20/25			United States			517,000						(514,867)
			OneMain Finance Corp., senior note, 7.125%, 3/15/26			United States			216,000						(219,306)
															(734,173)
			Diversified Financial Services (0.3)%
d			Kronos Acquisition Holdings Inc. / KIK Custom Products Inc., senior note, 144A, 7.00%, 12/31/27			Canada			626,000						(617,561)
			Lincoln National Corp., senior bond,
			3.35%, 3/09/25			United States			198,000						(194,251)
			3.625%, 12/12/26			United States			300,000						(286,655)
d			Wash Multifamily Acquisition Inc., senior secured note, 144A, 5.75%, 4/15/26			United States			1,121,000						(1,090,707)
															(2,189,174)
			Entertainment (0.2)%
			Warnermedia Holdings Inc.,
			senior bond, 5.141%, 3/15/52			United States			688,000						(543,468)
			senior note, 4.279%, 3/15/32			United States			985,000						(862,472)
															(1,405,940)
			Equity Real Estate Investment Trusts (REITs) (0.1)%
d			Hat Holdings I LLC / Hat Holdings II LLC, senior note, 144A, 3.375%, 6/15/26			United States			510,000						(479,669)
			Food Products (0.1)%
			B&G Foods Inc., senior note,
			5.25%, 4/01/25			United States			164,000						(161,482)
			5.25%, 9/15/27			United States			673,000						(618,273)
															(779,755)
			Health Care Technology (0.1)%
d			Cloud Software Group Inc., senior secured note, 144A, 9.00%, 9/30/29			United States			617,000						(597,535)
			Industrial Conglomerates (0.1)%
			3M Co., senior note,
			2.00%, 2/14/25			United States			408,000						(397,814)
			2.65%, 4/15/25			United States			150,000						(146,271)
															(544,085)
			Insurance (0.2)%
			MetLife Inc., senior bond,
			6.50%, 12/15/32			United States			596,000						(649,189)
			6.375%, 6/15/34			United States			591,000						(633,857)
															(1,283,046)
			Media (0.2)%
			Grupo Televisa Sab, senior bond, 6.125%, 1/31/46			Mexico			254,000						(245,687)
			iHeartCommunications Inc., senior note, 8.375%, 5/01/27			United States			267,842						(97,038)
d			Univision Communications Inc., senior secured note, 144A, 7.375%, 6/30/30			United States			933,000						(884,984)
															(1,227,709)
			Pharmaceuticals (0.2)%
d			Organon & Co. / Organon Foreign Debt Co.-Issuer BV, senior bond, 144A, 5.125%, 4/30/31			United States			1,380,000						(1,220,668)

franklintempleton.com			Annual Report			31

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Country

Principal Amount*

Value

Securities Sold Short (continued)

Corporate Bonds and Notes (continued)

Semiconductors & Semiconductor Equipment (0.1)%

Intel Corp.,

senior bond, 3.90%, 3/25/30

United States

258,000

$(241,121)

senior note, 2.45%, 11/15/29

United States

240,000

(209,564)

senior note, 5.125%, 2/10/30

United States

388,000

(387,644)

(838,329)

Software (0.1)%

Concentrix Corp.,

senior bond, 6.85%, 8/02/33

United States

467,000

(458,127)

senior note, 6.60%, 8/02/28

United States

450,000

(453,720)

(911,847)

Specialty Retail (0.0)%†

d

Upbound Group Inc., senior note, 144A, 6.375%, 2/15/29

United States

15,000

(14,480)

Total Corporate Bonds and Notes (Proceeds $20,240,862)

(20,568,816)

Foreign Government and Agency Securities (0.4)%

d

Government of Italy, senior bond, Reg S,

10Y, 0.95%, 6/01/32

Italy

467,000

EUR

(411,393)

10Y, 2.50%, 12/01/32

Italy

833,000

EUR

(822,809)

Government of Turkey, senior bond, 7.375%, 2/05/25

Turkey

1,224,000

(1,232,109)

Total Foreign Government and Agency Securities (Proceeds $2,457,806)

(2,466,311)

U.S. Government and Agency Securities (0.1)%

U.S. Treasury Note,

4.625%, 4/30/29

United States

46,000

(46,230)

4.375%, 5/15/34

United States

751,000

(744,370)

Total U.S. Government and Agency Securities (Proceeds $793,884)

(790,600)

p

Senior Floating Rate Interests (1.0)%

Automobile Components (0.4)%

First Brands Group LLC, First Lien Term Loan, 10.59%, (3-Month SOFR + 5.00%), 3/30/27

United States

2,770,541

(2,749,206)

Commercial Services & Supplies (0.0)%†

Sotheby's, 10.06%, (3-Month SOFR + 4.50%), 1/15/27

United States

118,069

(111,379)

Diversified Telecommunication Services (0.1)%

Consolidated Communications, Term Loan B, 8.941%, (1-Month SOFR + 3.61%), 10/02/27

United States

376,257

(359,225)

Health Care Providers & Services (0.1)%

o

Petco Health & Wellness Co. Inc., First Lien Term Loan, 8.821%, (3-Month SOFR + 3.51%), 3/03/28

United States

450,437

(409,215)

Professional Services (0.2)%

CoreLogic Inc., Term Loan B, 4.00%, (1-Month USD LIBOR + 3.50%), 6/02/28

United States

1,288,657

(1,274,965)

Transportation & Logistics (0.2)%

o

Forward Air Corp., Term Loan B, 9.826%, (1-Month SOFR + 4.50%), 12/19/30

United States

1,170,194

(1,079,018)

Total Senior Floating Rate Interests (Proceeds $5,943,552)

(5,983,008)

Total Securities Sold Short (Proceeds $108,064,738)

$(105,141,373)

32			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

† Rounds to less than 0.1% of net assets.

* The principal amount is stated in U.S. dollars unless otherwise indicated.

# Notional amount is the number of contracts multiplied by contract size, and may be multiplied by the underlying price. May include currency units, bushels, shares, pounds, barrels or other units. Currency units are stated in U.S. dollars unless otherwise indicated.

a Non-income producing.

b A portion or all of the security has been segregated as collateral for securities sold short, open swap contracts, open forward exchange contracts, open futures contracts and/or open written option contracts. At May 31, 2024, the aggregate value of these securities and/or cash pledged amounted to $77,521,954, representing 12.2% of net assets.

c A portion or all of the security is on loan at May 31, 2024. See Note 1(f).

d 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 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 May 31, 2024, the net value of these securities was $37,591,989, representing 5.9% of net assets.

e Fair valued using significant unobservable inputs. See Note 13 regarding fair value measurements.

f A portion or all of the security is held in connection with written option contracts open at period end.

g See Note 9 regarding investments in Russian securities.

h Defaulted security or security for which income has been deemed uncollectible. See Note 7.

i Perpetual security with no stated maturity date.

j Income may be received in additional securities and/or cash.

k A portion or all of the security purchased on a delayed delivery basis. See Note 1(c).

l Principal amount is stated in 100 Mexican Peso Units.

m See Note 1(h) regarding senior floating rate interests.

n The coupon rate shown represents the rate inclusive of any caps or floors, if applicable, in effect at period end.

o See Note 10 regarding unfunded loan commitments.

p The coupon rate shown represents the rate at period end.

q The rate shown is the annualized seven-day effective yield at period end.

r A portion or all of the security is owned by K2 Holdings Investment Corp., a wholly-owned subsidiary of the Fund. See Note 1(g).

s See Note 1(f) regarding securities on loan.

t See Note 3(f) regarding investments in affiliated investment companies.

u The security was issued on a discount basis with no stated coupon rate.

v See Note 1(d) regarding written options.

w See Note 1(e) regarding securities sold short.

franklintempleton.com			Annual Report			33

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

At May 31, 2024, the Fund had the following futures contracts outstanding. See Note 1(d).

Futures Contracts

	Description			Type			Number of Contracts			Notional Amount*			Expiration Date			Value/Unrealized Appreciation (Depreciation)
	Commodity Contractsa
	Aluminum			Long			27			$1,769,269			6/17/24			$165,483
	Aluminum			Short			27			1,769,269			6/17/24			(165,186)
	Aluminum			Long			12			799,491			9/16/24			30,916
	Brent Crude Oil			Long			76			6,164,360			6/28/24			(143,900)
	Brent Crude Oil			Long			3			242,610			7/31/24			(5,180)
	Canola			Long			15			145,493			7/12/24			3,936
	Canola			Long			14			140,354			11/14/24			4,528
	Cocoa			Short			2			189,710			7/16/24			(31,766)
	Cocoa			Long			3			264,152			9/13/24			2,173
	Cocoa			Short			7			603,211			9/13/24			(101,846)
	Cocoa			Short			2			154,260			12/13/24			(32,190)
	Coffee			Long			18			1,500,863			7/19/24			100,438
	Coffee			Long			1			82,969			9/18/24			(2,588)
	Copper			Long			19			4,724,055			6/17/24			463,170
	Copper			Short			19			4,724,055			6/17/24			(384,195)
	Copper			Long			4			460,200			7/29/24			(5,125)
	Copper			Long			11			2,768,947			9/16/24			11,877
	Copper			Short			1			251,723			9/16/24			6,774
	Copper			Long			1			115,263			9/26/24			(587)
	Corn			Short			136			3,034,500			7/12/24			2,621
	Corn			Short			14			317,800			9/13/24			4,600
	Corn			Short			42			980,700			12/13/24			12,163
	Corn			Short			3			71,925			3/14/25			1,963
	Corn			Short			1			24,350			5/14/25			(350)
	Corn			Short			1			24,600			7/14/25			138
	Cotton			Long			5			190,375			7/09/24			(22,075)
	Cotton			Short			6			228,450			7/09/24			7,797
	Cotton			Long			3			112,665			12/06/24			(5,700)
	Gasoline			Long			15			1,522,962			6/28/24			(61,347)
	Gasoline			Long			1			100,762			7/31/24			(1,718)
	Gold 100 Oz			Long			17			3,987,860			8/28/24			(43,639)
	Gold 100 Oz			Short			12			2,814,960			8/28/24			30,820
	Hard Red Winter Wheat			Short			50			1,771,875			7/12/24			(295,120)
	Hard Red Winter Wheat			Short			13			470,113			9/13/24			(59,213)
	Hard Red Winter Wheat			Short			10			370,875			12/13/24			(48,000)
	Hard Red Winter Wheat			Short			1			37,738			3/14/25			(3,975)
	Lean Hogs			Short			6			226,440			6/14/24			21,950
	Lean Hogs			Short			22			854,700			7/15/24			39,470
	Lean Hogs			Short			15			579,000			8/14/24			27,120
	Lean Hogs			Short			3			99,480			10/14/24			2,870
	Live Cattle			Short			6			435,720			6/28/24			(10,530)
	Live Cattle			Short			23			1,641,740			8/30/24			2,630
	Live Cattle			Short			7			506,240			10/31/24			(5,650)
	Live Cattle			Short			5			369,300			12/31/24			(4,680)
	Low Sulphur Gas Oil			Long			5			365,875			6/12/24			(9,975)
	Low Sulphur Gas Oil			Long			46			3,378,700			7/11/24			(114,552)
	Low Sulphur Gas Oil			Long			4			295,000			8/12/24			(13,575)
	Low Sulphur Gas Oil			Long			1			74,050			9/12/24			(1,375)
	Milling Wheat			Short			15			210,975			9/10/24			(26,316)
	Milling Wheat			Short			27			387,811			12/10/24			(41,306)
	Milling Wheat			Short			3			43,334			3/10/25			(3,447)
	Milling Wheat			Short			1			14,445			5/12/25			(462)
	Natural Gas			Long			10			258,700			6/26/24			(9,980)
	Natural Gas			Short			19			491,530			6/26/24			19,058

34			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Futures Contracts (continued)

	Description			Type			Number of Contracts			Notional Amount*			Expiration Date			Value/Unrealized Appreciation (Depreciation)
	Commodity Contracts (continued)a
	Natural Gas			Long			2			$53,240			7/29/24			$(2,590)
	Natural Gas			Long			1			26,510			8/28/24			1,320
	Natural Gas			Long			2			54,880			9/26/24			(280)
	Natural Gas			Long			1			31,090			10/29/24			(740)
	NY Harbor Ultra Low Sulfur Diesel			Long			7			700,955			6/28/24			(40,740)
	NY Harbor Ultra Low Sulfur Diesel			Long			2			201,902			7/31/24			(7,396)
	NY Harbor Ultra Low Sulfur Diesel			Long			2			203,448			8/30/24			(5,309)
	Palladium			Long			5			456,450			9/26/24			(40,280)
	Platinum			Long			24			1,250,400			7/29/24			147,960
	Platinum			Long			1			52,695			10/29/24			545
	Rapeseed			Short			1			26,448			7/31/24			(1,601)
	Rapeseed			Short			1			26,882			10/31/24			(1,614)
	Robusta Coffee			Long			6			247,200			7/25/24			11,860
	Robusta Coffee			Long			15			598,050			9/24/24			11,930
	Robusta Coffee			Long			4			154,160			11/25/24			(3,150)
	Silver			Long			19			2,891,800			7/29/24			137,326
	Silver			Short			18			2,739,600			7/29/24			(241,885)
	Silver			Short			2			307,670			9/26/24			16,605
	Soybean Meal			Long			18			656,460			7/12/24			(20,771)
	Soybean Meal			Short			18			656,460			7/12/24			(39,450)
	Soybean Meal			Short			4			143,200			8/14/24			(2,930)
	Soybean Meal			Short			2			71,180			9/13/24			(3,110)
	Soybean Meal			Short			1			35,570			10/14/24			(1,950)
	Soybean Meal			Short			11			395,340			12/13/24			(6,700)
	Soybean Meal			Short			1			36,020			1/14/25			1,260
	Soybean Oil			Short			37			1,010,544			7/12/24			(282)
	Soybean Oil			Short			2			54,936			8/14/24			(510)
	Soybean Oil			Short			1			27,522			9/13/24			(282)
	Soybean Oil			Short			1			27,516			10/14/24			(180)
	Soybean Oil			Short			6			165,816			12/13/24			(2,124)
	Soybeans			Short			42			2,530,500			7/12/24			(51,440)
	Soybeans			Short			3			180,525			8/14/24			(1,350)
	Soybeans			Short			1			59,225			9/13/24			(988)
	Soybeans			Short			24			1,421,400			11/14/24			7,700
	Soybeans			Short			2			119,750			1/14/25			1,550
	Sugar			Long			36			737,856			6/28/24			(127,088)
	Sugar			Short			51			1,045,296			6/28/24			112,358
	Sugar			Short			14			286,787			9/30/24			21,504
	Sugar			Short			3			62,362			2/28/25			3,192
	UK Natural Gas			Short			45			1,454,593			6/27/24			(31,403)
	UK Natural Gas			Short			5			164,110			7/30/24			1,560
	Wheat			Short			44			1,492,700			7/12/24			(234,333)
	Wheat			Short			10			349,750			9/13/24			(49,050)
	Wheat			Short			8			289,400			12/13/24			(37,925)
	Wheat			Short			1			37,013			3/14/25			(4,663)
	White Sugar			Short			11			297,935			7/16/24			38,840
	White Sugar			Short			4			103,740			9/13/24			10,310
	White Sugar			Short			1			25,440			11/15/24			1,660
	WTI Crude Oil			Long			45			3,464,550			6/20/24			(54,739)
	Zinc			Long			10			732,320			6/17/24			139,760
	Zinc			Short			10			732,320			6/17/24			(42,750)
	Zinc			Long			7			521,071			9/16/24			8,221
																(1,077,195)
	Currency Contractsa
	Australian Dollar Index			Short			16			1,063,440			6/17/24			(20,715)
	British Pound Index			Long			8			636,600			6/17/24			(225)

franklintempleton.com			Annual Report			35

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Futures Contracts (continued)

	Description			Type			Number of Contracts			Notional Amount*			Expiration Date			Value/Unrealized Appreciation (Depreciation)
	Currency Contracts (continued)a
	Canadian Dollar Index			Short			178			$13,063,420			6/18/24			$94,974
	EUR/CZK			Long			3			527,074			6/17/24			7,992
	EUR/HUF			Long			13			1,085,007			6/17/24			5,996
	EUR/NOK			Long			34			4,612,268			6/17/24			(153,770)
	EUR/PLN			Long			16			2,030,694			6/17/24			21,309
	EUR/SEK			Long			2			271,227			6/17/24			(5,181)
	Euro Index			Long			145			19,665,625			6/17/24			(167,495)
	Japanese Yen Index			Long			54			4,302,112			6/17/24			(87,190)
	Mexican Peso Index			Long			420			12,343,800			6/17/24			(55,170)
	New Israeli Shekel Index			Short			5			1,348,450			6/17/24			(19,214)
	New Zealand Dollar Index			Short			52			3,192,280			6/17/24			2,910
	South African Rand Index			Short			121			3,212,550			6/17/24			(29,728)
	Swiss Franc Index			Short			86			11,927,663			6/17/24			368,094
	U.S. Dollar Index			Long			260			3,640,807			6/17/24			85,614
																48,201
	Equity Contracts
	CAC 40 10 Euro Indexa			Long			33			2,862,385			6/21/24			(67,085)
	CAC 40 10 Euro Indexa			Short			2			173,478			6/21/24			3,902
	CBOE Volatility Indexa			Long			56			772,218			6/18/24			(61,532)
	CBOE Volatility Indexa			Long			27			393,695			7/17/24			(24,655)
	CBOE Volatility Indexa			Long			7			105,712			8/21/24			(3,338)
	CBOE Volatility Indexa			Long			1			15,600			9/18/24			(150)
	DAX Indexa			Long			19			9,550,860			6/21/24			(15,291)
	DJ EURO STOXX 50 Indexa			Long			330			17,846,043			6/21/24			38,195
	DJ EURO STOXX 50 Index			Short			8			432,631			6/21/24			(1,473)
	DJIA Mini E-CBOT Indexa			Long			20			3,879,100			6/21/24			(66,299)
	E-Mini Russell 2000a			Long			9			934,110			6/21/24			(7,579)
	E-Mini Russell 2000a			Short			112			11,624,480			6/21/24			97,585
	E-mini S&P MidCap 400 Indexa			Short			6			1,795,140			6/21/24			1,760
	FTSE 100 Indexa			Long			70			7,390,908			6/21/24			160,761
	FTSE China A50 Indexa			Long			264			3,263,568			6/27/24			(61,795)
	FTSE Taiwan Indexa			Short			8			575,200			6/27/24			18,600
	FTSE/JSE Top 40 Indexa			Short			25			941,735			6/20/24			(45,761)
	FTSE/MIB Indexa			Long			3			562,702			6/21/24			(2,794)
	Hang Seng China Enterprises Indexa			Long			5			203,187			6/27/24			(9,032)
	Hang Seng Indexa			Long			12			1,381,694			6/27/24			(48,932)
	IBEX 35 Indexa			Short			23			2,825,762			6/21/24			(7,115)
	KOSPI 200 Indexa			Short			53			3,445,641			6/13/24			19,939
	MSCI Emerging Markets Indexa			Long			7			369,775			6/21/24			(3,505)
	MSCI Singapore Indexa			Long			22			502,946			6/27/24			(4,873)
	NASDAQ 100 E-Mini Indexa			Long			7			2,602,740			6/21/24			28,689
	Nikkei 225 Indexa			Long			161			10,034,018			6/13/24			(282,733)
	NSE IFSC Nifty 50 Indexa			Short			1			45,376			6/27/24			811
	S&P 500 E-Mini Indexa			Long			161			42,628,775			6/21/24			721,690
	S&P 500 E-Mini Index			Short			5			1,323,875			6/21/24			3,909
	S&P/TSX 60 Indexa			Long			19			3,720,401			6/20/24			43,857
	SPI 200 Indexa			Short			9			1,155,564			6/20/24			481
	TOPIX Indexa			Long			44			7,755,572			6/13/24			185,313
																611,550
	Interest Rate Contractsa
	3 Month EURIBOR			Long			31			8,108,936			9/16/24			(19,445)
	3 Month EURIBOR			Long			32			8,385,271			12/16/24			(25,244)
	3 Month EURIBOR			Long			25			6,561,166			3/17/25			(27,331)
	3 Month EURIBOR			Long			26			6,833,133			6/16/25			(31,024)
	3 Month EURIBOR			Short			146			38,370,672			6/16/25			200,805
	3 Month EURIBOR			Long			18			4,736,734			9/15/25			(21,978)

36			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Futures Contracts (continued)

	Description			Type			Number of Contracts			Notional Amount*			Expiration Date			Value/Unrealized Appreciation (Depreciation)
	Interest Rate Contracts (continued)a
	3 Month EURIBOR			Long			20			$5,268,463			12/15/25			$(22,314)
	3 Month EURIBOR			Long			12			3,163,519			3/16/26			(11,019)
	3 Month EURIBOR			Long			6			1,582,736			6/15/26			(5,465)
	3 Month SOFR			Short			12			2,844,600			12/17/24			313
	3 Month SOFR			Short			14			3,326,050			3/18/25			(100)
	3 Month SOFR			Short			10			2,381,125			6/17/25			(513)
	3 Month SOFR			Short			302			72,064,750			9/16/25			113,099
	3 Month SOFR			Short			8			1,912,700			12/16/25			(563)
	3 Month SOFR			Short			7			1,676,238			3/17/26			163
	3 Month SOFR			Short			5			1,198,688			6/16/26			(225)
	3 Month SOFR			Short			4			959,700			9/15/26			(638)
	3 Month SONIA			Short			12			3,630,850			12/17/24			8,215
	3 Month SONIA			Short			14			4,243,796			3/18/25			11,000
	3 Month SONIA			Short			12			3,643,847			6/17/25			23,967
	3 Month SONIA			Short			34			10,342,105			9/16/25			12,411
	ASX 90 Day Bank Accepted Bill			Long			10			6,581,930			9/12/24			(3,649)
	ASX 90 Day Bank Accepted Bill			Long			8			5,265,544			12/12/24			(4,609)
	ASX 90 Day Bank Accepted Bill			Long			6			3,949,832			3/13/25			(3,828)
	ASX 90 Day Bank Accepted Bill			Long			4			254,829			6/12/25			(1,143)
	ASX 90 Day Bank Accepted Bill			Long			2			1,275,210			9/11/25			(5,854)
	Australian 3 Yr. Bond			Long			89			6,244,747			6/17/24			(76,472)
	Australian 10 Yr. Bond			Long			33			2,473,617			6/17/24			(21,257)
	Australian 10 Yr. Bond			Short			64			4,797,319			6/17/24			91,429
	Canadian 10 Yr. Bond			Long			42			3,663,348			9/18/24			(8,391)
	Euro-BOBL			Long			22			2,767,617			6/06/24			(33,645)
	Euro-BOBL			Long			11			1,377,244			9/06/24			3,223
	Euro-BOBL			Short			22			2,754,488			9/06/24			(2,527)
	Euro-Bund			Long			108			15,156,768			6/06/24			(360,991)
	Euro-Bund			Long			62			8,744,162			9/06/24			33,391
	Euro-Buxl			Short			13			1,783,237			6/06/24			96,178
	Euro-OAT			Long			25			3,383,730			6/06/24			(71,206)
	Euro-SCHATZ			Long			22			2,505,631			6/06/24			(3,997)
	Euro-SCHATZ			Long			22			2,512,196			9/06/24			1,611
	Euro-SCHATZ			Short			219			25,007,769			9/06/24			(10,295)
	Japanese 10 Yr. Bond			Long			3			2,727,689			6/13/24			(47,026)
	Korean 3 Yr. Bond			Long			16			1,204,955			6/18/24			(4,586)
	Korean 10 Yr. Bond			Short			21			1,695,410			6/18/24			(1,873)
	Long Gilt			Long			16			1,963,773			9/26/24			(11,747)
	Long Gilt			Short			50			6,136,791			9/26/24			47,202
	U.S. Treasury 2 Yr. Note			Long			269			54,796,141			9/30/24			(45,921)
	U.S. Treasury 2 Yr. Note			Short			159			32,388,797			9/30/24			(13,145)
	U.S. Treasury 5 Yr. Note			Short			130			13,753,593			9/30/24			4,573
	U.S. Treasury 10 Yr. Note			Short			266			28,939,968			9/19/24			19,522
	U.S. Treasury 10 Yr. Ultra			Short			35			3,921,094			9/19/24			2,523
	U.S. Treasury Long Bond			Long			8			928,500			9/19/24			(7,200)
	U.S. Treasury Long Bond			Short			40			4,642,500			9/19/24			16,648
	U.S. Treasury Ultra Bond			Short			30			3,673,125			9/19/24			24,258
																(194,690)
	Total Futures Contracts															$(612,134)

*As of period end.

aA portion or all of the contracts are owned by K2 Holdings Investment Corp., a wholly-owned subsidiary of the Fund. See Note 1(g).

franklintempleton.com			Annual Report			37

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

At May 31, 2024, the Fund had the following forward exchange contracts outstanding. See Note 1(d).

Forward Exchange Contracts

	Currency			Counterpartya			Type			Quantity			Contract Amount*						Settlement Date			Unrealized Appreciation			Unrealized Depreciation
	OTC Forward Exchange Contracts
	Australian Dollar			BZWS			Buy			2,272,000			1,481,773						6/20/24			$30,814			$—
	Australian Dollar			BZWS			Sell			3,103,000			2,042,290						6/20/24			520			(24,054)
	British Pound			BZWS			Buy			1,834,000			2,304,585						6/20/24			32,632			(4)
	British Pound			BZWS			Sell			2,133,000			2,714,361						6/20/24			—			(3,892)
	British Pound			JPHQ			Sell			768,000			978,658						6/20/24			—			(68)
	Euro			BZWS			Buy			1,559,000			1,689,084						6/20/24			7,020			(2,972)
	Euro			BZWS			Sell			2,072,000			2,261,960						6/20/24			12,487			(796)
	Euro			JPHQ			Buy			160,000			172,261						6/20/24			1,505			—
	Euro			JPHQ			Sell			1,104,000			1,206,692						6/20/24			7,706			—
	Japanese Yen			BZWS			Sell			5,653,000			36,523						6/20/24			464			—
	Norwegian Krone			BZWS			Buy			17,743,000			1,681,855						6/20/24			9,416			—
	Norwegian Krone			BZWS			Sell			17,743,000			1,673,717						6/20/24			—			(17,554)
	Swedish Krona			BZWS			Buy			11,101,000			1,050,329						6/20/24			5,581			—
	Swedish Krona			BZWS			Sell			11,483,000			1,088,458						6/20/24			4,781			(8,567)
	Australian Dollarb			MSCO			Buy			11,597,000			7,593,533						6/21/24			127,417			(5)
	Australian Dollarb			MSCO			Sell			17,077,000			11,288,096						6/21/24			1,474			(82,745)
	British Poundb			MSCO			Buy			2,326,000			2,956,764						6/21/24			15,244			(7,779)
	British Poundb			MSCO			Sell			4,393,000			5,528,186						6/21/24			1,038			(71,238)
	Canadian Dollarb			MSCO			Buy			5,661,000			4,163,190						6/21/24			7,439			(15,397)
	Canadian Dollarb			MSCO			Sell			18,787,000			13,902,709						6/21/24			132,336			(19,478)
	Eurob			MSCO			Buy			5,805,000			6,252,714						6/21/24			58,987			(6,961)
	Eurob			MSCO			Sell			19,784,000			21,527,611						6/21/24			109,053			(68,607)
	Japanese Yenb			MSCO			Buy			222,851,000			1,455,804						6/21/24			20			(34,092)
	Japanese Yenb			MSCO			Sell			1,248,324,000			8,476,890						6/21/24			512,912			—
	Mexican Pesob			MSCO			Buy			57,386,000			3,376,889						6/21/24			28			(6,172)
	Mexican Pesob			MSCO			Sell			2,694,000			157,775						6/21/24			160			(626)
	New Zealand Dollarb			MSCO			Buy			4,857,000			2,985,780						6/21/24			6,550			(6,728)
	New Zealand Dollarb			MSCO			Sell			10,210,000			6,158,082						6/21/24			945			(118,964)
	Swiss Francb			MSCO			Buy			422,000			467,926						6/21/24			1,880			(981)
	Swiss Francb			MSCO			Sell			7,248,000			8,276,741						6/21/24			227,290			(2,774)
	Canadian Dollar			BNYM			Buy			917,000			675,970						6/26/24			—			(2,815)
	Canadian Dollar			BNYM			Sell			1,109,000			818,301						6/26/24			4,202			—
	Euro			BNYM			Buy			700,000			758,774						6/26/24			2,374			(713)
	Euro			BNYM			Sell			1,793,000			1,947,748						6/26/24			—			(51)
	Hong Kong Dollar			BNYM			Buy			5,583,000			714,988						6/26/24			—			(546)
	Hong Kong Dollar			BNYM			Sell			9,897,000			1,268,308						6/26/24			1,815			—
	Euro			BZWS			Sell			439,180			51,651,983			RSD			7/03/24			2,345			(963)
	​Serbian Dinar			BZWS			Sell			51,651,983			439,666			EUR			7/03/24			4,826			(5,680)
	Chinese Yuan			BZWS			Sell			19,659,750			2,757,715						7/17/24			30,084			—
	Chinese Yuan			HSBC			Buy			19,633,516			2,765,114						7/17/24			—			(41,123)
	Colombian Peso			BZWS			Buy			5,497,206,461			1,391,515						7/17/24			19,893			—
	Colombian Peso			BZWS			Sell			857,759,635			216,718						7/17/24			—			(3,512)
	Colombian Peso			CITI			Buy			2,880,670,721			728,362						7/17/24			11,250			—
	Colombian Peso			GSCO			Sell			2,140,954,728			539,353						7/17/24			—			(10,337)
	Colombian Peso			​JPHQ			Buy			3,607,907,843			913,517						7/17/24			12,813			—
	Colombian Peso			UBSW			Sell			10,145,167,600			2,619,054						7/17/24			14,282			—
	Colombian Peso			​JPHQ			Buy			2,807,768,715			711,638						7/17/24			9,257			—
	Colombian Peso			​JPHQ			Sell			7,205,935,000			1,850,000						7/17/24			—			(124)
	Czech Koruna			BOFA			Buy			26,987,444			1,135,501						7/17/24			51,168			—
	Czech Koruna			BZWS			Sell			27,448,000			1,176,993						7/17/24			—			(29,927)
	Euro			​JPHQ			Sell			85,000			91,126						7/17/24			—			(1,305)
	Euro			BNPP			Buy			885,000			956,701						7/17/24			5,664			—

38			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Forward Exchange Contracts (continued)

	Currency			Counterpartya			Type			Quantity			Contract Amount*						Settlement Date			Unrealized Appreciation			Unrealized Depreciation
	OTC Forward Exchange Contracts (continued)
	Euro			BZWS			Buy			3,073,650			3,280,000						7/17/24			$62,344			$—
	Euro			CITI			Buy			1,085,000			1,169,577						7/17/24			10,272			—
	Hungarian Forint			GSCO			Sell			28,756,785			73,124			EUR			7/17/24			—			(420)
	Euro			MLCO			Sell			1,969,505			2,130,000						7/17/24			—			(11,676)
	Polish Zloty			MSCO			Sell			679,667			​157,779			EUR			7/17/24			​—			(859)
	Euro			MSCO			Buy			1,133,000			1,215,151						7/17/24			16,894			—
	Euro			MSCO			Sell			910,377			979,878						7/17/24		��	1,022			(11,105)
	Euro			​JPHQ			Sell			2,707,953			2,951,907						7/17/24			7,230			—
	Euro			SSBT			Sell			240,000			260,411						7/17/24			—			(569)
	Euro			​JPHQ			Sell			114,794			124,074						7/17/24			—			(755)
	Indonesian Rupiah			BZWS			Buy			500,000,000			30,702						7/17/24			44			—
	Indonesian Rupiah			MSCO			Buy			21,201,459,961			1,316,812						7/17/24			—			(13,113)
	Indonesian Rupiah			MSCO			Sell			1,608,652,487			100,821						7/17/24			1,903			—
	Indonesian Rupiah			​JPHQ			Sell			1,608,652,488			100,832						7/17/24			1,914			—
	Indonesian Rupiah			SSBT			Sell			22,084,230,858			1,366,289						7/17/24			8,308			—
	Indonesian Rupiah			UBSW			Buy			45,081,750,000			2,770,000						7/17/24			2,122			—
	Indonesian Rupiah			UBSW			Sell			34,859,290,000			2,180,000						7/17/24			36,467			—
	Japanese Yen			UBSW			Buy			32,891,464			219,814						7/17/24			—			(9,123)
	Kazakhstan Tenge			CITI			Sell			284,392,039			630,595						7/17/24			1,547			—
	Kazakhstan Tenge			JPHQ			Buy			281,445,408			615,720						7/17/24			6,810			—
	Mexican Peso			BNPP			Sell			45,064,602			2,659,937						7/17/24			27,613			(3,592)
	Mexican Peso			BZWS			Buy			30,603,300			1,770,000						7/17/24			20,047			—
	Mexican Peso			BZWS			Sell			23,502,997			1,397,723						7/17/24			22,987			—
	Mexican Peso			CITI			Buy			27,559,000			1,609,184						7/17/24			2,796			—
	Mexican Peso			​JPHQ			Buy			18,623,520			1,080,000						7/17/24			9,326			—
	Mexican Peso			UBSW			Sell			639,000			36,603						7/17/24			—			(773)
	Peruvian Nuevo Sol			​JPHQ			Sell			2,261,866			602,923						7/17/24			—			(4,207)
	Peruvian Nuevo Sol			CITI			Sell			5,796,691			1,559,321						7/17/24			3,373			—
	Peruvian Nuevo Sol			GSCO			Buy			7,507,953			2,003,239						7/17/24			12,517			(471)
	Peruvian Nuevo Sol			JPHQ			Buy			1,541,813			415,471						7/17/24			—			(1,618)
	Peruvian Nuevo Sol			UBSW			Sell			3,830,108			1,017,077						7/17/24			—			(11,001)
	Peruvian Nuevo Sol			​JPHQ			Buy			1,539,229			414,529						7/17/24			—			(1,369)
	Peruvian Nuevo Sol			​JPHQ			Sell			3,047,866			819,737						7/17/24			1,629			—
	Philippine Peso			CITI			Buy			33,284,284			578,985						7/17/24			—			(10,746)
	Philippine Peso			​JPHQ			Buy			13,271,119			231,015						7/17/24			—			(4,447)
	Romanian Leu			BNPP			Sell			4,972,342			1,083,980						7/17/24			2,143			(1,521)
	Romanian Leu			BZWS			Buy			3,061,552			657,127						7/17/24			9,914			—
	Romanian Leu			HSBC			Buy			4,096,979			877,621						7/17/24			15,016			—
	Romanian Leu			UBSW			Sell			2,158,473			471,391						7/17/24			1,110			—
	South African Rand			BNPP			Sell			5,692,442			299,256						7/17/24			—			(2,565)
	South African Rand			BZWS			Sell			7,699,860			405,358						7/17/24			—			(2,899)
	South African Rand			HSBC			Sell			36,902,676			1,955,386						7/17/24			1,386			(2,627)
	South African Rand			MLCO			Buy			12,972,765			710,000						7/17/24			—			(22,167)
	South African Rand			MSCO			Sell			20,362,139			1,089,861						7/17/24			10,234			—
	South African Rand			SSBT			Buy			15,646,000			840,620						7/17/24			—			(11,049)
	South African Rand			​JPHQ			Buy			26,084,242			1,392,564						7/17/24			—			(9,544)
	Turkish Lira			BNPP			Buy			1,956,848			56,072						7/17/24			2,005			—
	Turkish Lira			BZWS			Buy			48,606,400			1,360,000						7/17/24			82,573			—
	Turkish Lira			BZWS			Sell			38,743,312			1,130,532						7/17/24			—			(19,318)
	Turkish Lira			CITI			Sell			8,849,361			262,147						7/17/24			—			(490)
	Turkish Lira			HSBC			Sell			11,819,937			340,567						7/17/24			—			(10,233)
	Brazilian Real			BNPP			Buy			4,688,459			899,087						8/02/24			—			(11,694)
	Brazilian Real			BNPP			Sell			8,677,128			1,681,587						8/02/24			39,252			—
	Brazilian Real			​JPHQ			Buy			5,860,574			1,133,365						8/02/24			—			(24,124)

franklintempleton.com			Annual Report			39

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Forward Exchange Contracts (continued)

	Currency			Counterpartya			Type			Quantity			Contract Amount*						Settlement Date			Unrealized Appreciation			Unrealized Depreciation
	OTC Forward Exchange Contracts (continued)
	Brazilian Real			HSBC			Buy			5,880,709			1,127,177						8/02/24			$—			$(14,125)
	Chinese Yuan			MSCO			Sell			2,828,471			397,658						8/15/24			​3,979			​—
	South Korean Won			MSCO			Buy			530,163,970			390,166						8/20/24			—			(5,517)
	British Pound			MSCO			Sell			2,250,000			2,873,866						8/30/24			5,419			—
	Danish Krone			MSCO			Sell			3,300,000			483,359						8/30/24			837			—
	Euro			MSCO			Sell			4,350,000			4,749,970						8/30/24			9,970			—
	Norwegian Krone			MSCO			Sell			1,500,000			143,031						8/30/24			—			(202)
	Polish Zloty			MSCO			Sell			100,000			25,487						8/30/24			131			—
	Swedish Krona			MSCO			Sell			5,200,000			494,538						8/30/24			—			(1,899)
	Swiss Franc			MSCO			Buy			400,000			443,378						8/30/24			4,628			—
	Turkish Lira			BZWS			Buy			31,324,290			790,000						11/04/24			47,563			—
	Turkish Lira			BZWS			Sell			15,693,533			394,122						11/04/24			—			(25,499)
	Euro			CITI			Sell			388,213			45,964,441			RSD			11/07/24			4,160			​(2,470)
	Georgian Lari			CITI			Sell			1,133,400			404,064						11/08/24			—			(1,736)
	Turkish Lira			BZWS			Buy			38,743,312			1,003,038						11/12/24			24,789			—
	Euro			BNPP			Sell			439,180			52,262,444			RSD			1/17/25			9,056			(6,342)
	​Serbian Dinar			BNPP			Sell			52,262,444			438,370			EUR			1/17/25			4,625			(8,228)
	Euro			CITI			Sell			204,462			24,398,396			RSD			3/28/25			1,154			—
	Euro			JPHQ			Sell			2,900,000			3,396,074						3/31/25			203,691			—
	Euro			GSCO			Sell			178,965			21,359,458			RSD			5/05/25			1,078			(358)
	Total Forward Exchange Contracts																					$2,227,550			$(868,001)
	Net unrealized appreciation (depreciation)																								$1,359,549

*In U.S. dollars unless otherwise indicated.

aMay be comprised of multiple contracts with the same counterparty, currency and settlement date.

bA portion or all of the contracts are owned by K2 Holdings Investment Corp., a wholly-owned subsidiary of the Fund. See Note 1(g).

40			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

At May 31, 2024, the Fund had the following credit default swap contracts outstanding. See Note 1(d).

Credit Default Swap Contracts

			Description			Annual Payment Rate Received (Paid)			Payment Frequency						Maturity Date			Notional Amounta						Value			Upfront Payments (Receipts)			Unrealized Appreciation (Depreciation)			Ratingb
			Centrally Cleared Swap Contracts
			Contracts to Buy Protectionc
			Single Name
			Air France-KLM			(5.00)%			Quarterly						12/20/27			27,000			EUR			$(3,540)			$1,968			$(5,508)
			Air France-KLM			(5.00)%			Quarterly						12/20/27			38,000			EUR			(4,982)			2,710			(7,692)
			Air France-KLM			(5.00)%			Quarterly						12/20/27			70,000			EUR			(9,177)			3,700			(12,877)
			Air France-KLM			(5.00)%			Quarterly						12/20/27			80,000			EUR			(14,496)			5,459			(19,955)
			Air France-KLM			(5.00)%			Quarterly						12/20/27			132,000			EUR			(17,305)			7,298			(24,603)
			Air France-KLM			(5.00)%			Quarterly						6/20/24			200,000			EUR			(556)			(56)			(500)
			Air France-KLM			(5.00)%			Quarterly						6/20/24			100,000			EUR			(278)			(123)			(155)
			American Airlines Inc.			(5.00)%			Quarterly						6/20/24			143,000						(299)			155			(454)
			American Airlines Inc.			(5.00)%			Quarterly						6/20/24			286,000						(598)			623			(1,221)
			American Airlines Inc.			(5.00)%			Quarterly						6/20/24			178,000						(372)			661			(1,033)
			American Airlines Inc.			(5.00)%			Quarterly						6/20/25			72,000						(2,145)			3,648			(5,793)
			American Airlines Inc.			(5.00)%			Quarterly						6/20/26			145,000						(4,092)			(6,385)			2,293
			American Airlines Inc.			(5.00)%			Quarterly						6/20/26			73,000						(2,060)			(3,000)			940
			American Airlines Inc.			(5.00)%			Quarterly						6/20/26			107,000						(3,019)			(4,556)			1,537
			American Airlines Inc.			(5.00)%			Quarterly						6/20/24			41,000						(86)			112			(198)
			American Airlines Inc.			(5.00)%			Quarterly						6/20/24			189,000						(395)			566			(961)
			American Airlines Inc.			(5.00)%			Quarterly						12/20/25			275,000						(7,968)			(11,907)			3,939
			American Airlines Inc.			(5.00)%			Quarterly						6/20/26			145,000						(4,092)			(4,565)			473
			American Airlines Inc.			(5.00)%			Quarterly						6/20/25			59,000						(1,758)			292			(2,050)
			American Airlines Inc.			(5.00)%			Quarterly						6/20/25			72,000						(2,145)			474			(2,619)
			American Airlines Inc.			(5.00)%			Quarterly						6/20/25			216,000						(6,435)			715			(7,150)
			American Airlines Inc.			(5.00)%			Quarterly						6/20/25			72,000						(2,145)			1,104			(3,249)
			American Airlines Inc.			(5.00)%			Quarterly						6/20/25			144,000						(4,290)			2,437			(6,727)
			American Airlines Inc.			(5.00)%			Quarterly						6/20/25			144,000						(4,290)			2,552			(6,842)
			American Airlines Inc.			(5.00)%			Quarterly						12/20/25			110,000						(3,187)			(4,780)			1,593
			American Airlines Inc.			(5.00)%			Quarterly						12/20/25			55,000						(1,593)			(2,389)			796
			American Airlines Inc.			(5.00)%			Quarterly						6/20/26			145,000						(4,092)			(5,259)			1,167
			American Airlines Inc.			(5.00)%			Quarterly						6/20/26			145,000						(4,092)			(4,562)			470
			American Airlines Inc.			(5.00)%			Quarterly						6/20/26			40,000						(1,129)			(1,278)			149
			American Axle & Manufacturing Inc.			(5.00)%			Quarterly						6/20/29			144,000						(10,747)			(11,010)			263
			American Axle & Manufacturing Inc.			(5.00)%			Quarterly						6/20/27			72,000						(6,161)			(3,068)			(3,093)
			American Axle & Manufacturing Inc.			(5.00)%			Quarterly						6/20/27			72,000						(6,161)			(1,875)			(4,286)
			American Axle & Manufacturing Inc.			(5.00)%			Quarterly						6/20/27			72,000						(6,161)			(1,875)			(4,286)
			American Axle & Manufacturing Inc.			(5.00)%			Quarterly						6/20/27			72,000						(6,161)			(1,743)			(4,418)
			American Axle & Manufacturing Inc.			(5.00)%			Quarterly						6/20/27			73,000						(6,247)			(2,243)			(4,004)
			American Axle & Manufacturing Inc.			(5.00)%			Quarterly						6/20/27			134,000						(11,466)			(1,455)			(10,011)
			American Axle & Manufacturing Inc.			(5.00)%			Quarterly						6/20/27			11,000						(941)			(233)			(708)
			American Axle & Manufacturing Inc.			(5.00)%			Quarterly						6/20/27			62,000						(5,305)			435			(5,740)
			Bayer AG			(1.00)%			Quarterly						6/20/29			292,000			EUR			(329)			2,998			(3,327)
			Bayer AG			(1.00)%			Quarterly						6/20/29			146,000			EUR			(165)			1,901			(2,066)
			BMW AG			(1.00)%			Quarterly						6/20/29			851,000			EUR			(22,784)			(21,347)			(1,437)
			Boparan Finance PLC			(5.00)%			Quarterly						6/20/24			72,000			EUR			29			645			(616)
			Carnival Corp.			(1.00)%			Quarterly						6/20/29			884,000						57,994			57,369			625
			Continental AG			(1.00)%			Quarterly						12/20/28			3,000			EUR			(27)			57			(84)
			Continental AG			(1.00)%			Quarterly						12/20/28			711,000			EUR			(6,505)			13,401			(19,906)
			Daimler Truck Holding AG			(1.00)%			Quarterly						6/20/29			858,000			EUR			(23,432)			(21,545)			(1,887)
			Ford Motor Co.			(5.00)%			Quarterly						6/20/29			1,386,000						(209,892)			(202,543)			(7,349)
			Ford Motor Co.			(5.00)%			Quarterly						6/20/29			335,000						(50,731)			(50,833)			102

franklintempleton.com			Annual Report			41

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Credit Default Swap Contracts (continued)

			Description			Annual Payment Rate Received (Paid)			Payment Frequency						Maturity Date			Notional Amounta						Value			Upfront Payments (Receipts)			Unrealized Appreciation (Depreciation)			Ratingb
			Centrally Cleared Swap Contracts (continued)
			Contracts to Buy Protectionc (continued)
			Single Name (continued)
			Ford Motor Co.			(5.00)%			Quarterly						6/20/29			290,000						$(43,917)			$(44,023)			$106
			Government of Egypt			(1.00)%			Quarterly						6/20/26			365,000						17,577			137,788			(120,211)
			Government of Italy			(1.00)%			Quarterly						6/20/24			132,000						(66)			32			(98)
			Government of Italy			(1.00)%			Quarterly						6/20/24			218,000						(110)			25			(135)
			Iceland Bondco			(5.00)%			Quarterly						6/20/29			23,000			EUR			1,151			1,381			(230)
			Iceland Bondco			(5.00)%			Quarterly						6/20/29			218,000			EUR			10,910			6,709			4,201
			K. Hovnanian Enterprises Inc.			(5.00)%			Quarterly						6/20/28			36,000						(3,303)			2,325			(5,628)
			K. Hovnanian Enterprises Inc.			(5.00)%			Quarterly						6/20/28			93,000						(8,532)			6,383			(14,915)
			K. Hovnanian Enterprises Inc.			(5.00)%			Quarterly						6/20/28			115,000						(10,550)			8,172			(18,722)
			Kohl’s Corp			(1.00)%			Quarterly						12/20/24			171,000						(200)			1,746			(1,946)
			Kohl’s Corp			(1.00)%			Quarterly						6/20/29			43,000						7,053			5,874			1,179
			Kohl’s Corp			(1.00)%			Quarterly						6/20/29			144,000						23,619			19,816			3,803
			Kohl’s Corp			(1.00)%			Quarterly						6/20/29			43,000						7,053			5,874			1,179
			Kohl’s Corp			(1.00)%			Quarterly						6/20/29			58,000						9,513			7,826			1,687
			Kohl’s Corp			(1.00)%			Quarterly						6/20/29			144,000						23,619			19,848			3,771
			Kohl’s Corp			(1.00)%			Quarterly						6/20/29			144,000						23,619			20,605			3,014
			Lanxess AG			(1.00)%			Quarterly						6/20/29			1,856,000			EUR			59,777			80,327			(20,550)
			Lincoln National Corp.			(1.00)%			Quarterly						6/20/25			5,000						(31)			46			(77)
			Lincoln National Corp.			(1.00)%			Quarterly						6/20/25			71,000						(445)			594			(1,039)
			Lincoln National Corp.			(1.00)%			Quarterly						6/20/25			135,000						(846)			1,168			(2,014)
			Lincoln National Corp.			(1.00)%			Quarterly						6/20/25			141,000						(883)			1,234			(2,117)
			Lincoln National Corp.			(1.00)%			Quarterly						6/20/25			360,000						(2,256)			3,219			(5,475)
			Lincoln National Corp.			(1.00)%			Quarterly						6/20/26			362,000						(2,834)			(349)			(2,485)
			Lincoln National Corp.			(1.00)%			Quarterly						6/20/27			362,000						(2,340)			1,506			(3,846)
			Lincoln National Corp.			(1.00)%			Quarterly						6/20/25			147,000						(921)			1,092			(2,013)
			Lincoln National Corp.			(1.00)%			Quarterly						12/20/25			43,000						(304)			645			(949)
			Lincoln National Corp.			(1.00)%			Quarterly						12/20/25			73,000						(515)			1,050			(1,565)
			Lincoln National Corp.			(1.00)%			Quarterly						12/20/25			144,000						(1,017)			1,757			(2,774)
			Lincoln National Corp.			(1.00)%			Quarterly						12/20/25			211,000						(1,489)			3,182			(4,671)
			MetLife Inc.			(1.00)%			Quarterly						6/20/29			363,000						(7,487)			(4,969)			(2,518)
			MetLife Inc.			(1.00)%			Quarterly						6/20/29			1,453,000						(29,970)			(19,494)			(10,476)
			MetLife Inc.			(1.00)%			Quarterly						6/20/29			1,008,000						(20,792)			(15,261)			(5,531)
			Novafives SAS			(5.00)%			Quarterly						6/20/29			29,000			EUR			(4,829)			(1,504)			(3,325)
			Novafives SAS			(5.00)%			Quarterly						6/20/29			43,000			EUR			(7,161)			(2,426)			(4,735)
			Saint-Gobain SA			(1.00)%			Quarterly						6/20/29			853,000			EUR			(25,109)			(22,111)			(2,998)
			SES S.A.			(1.00)%			Quarterly						6/20/29			1,024,000			EUR			9,897			5,449			4,448
			Stellantis NV			(5.00)%			Quarterly						6/20/29			803,000			EUR			(160,010)			(157,408)			(2,602)
			Stena AB			(5.00)%			Quarterly						6/20/29			290,000			EUR			(43,218)			(35,906)			(7,312)
			TDC A/S.			(1.00)%			Quarterly						6/20/27			212,000			EUR			(4,920)			7,458			(12,378)
			Telecom Italia SpA			(1.00)%			Quarterly						6/20/29			392,000			EUR			24,101			22,810			1,291
			Unibail-Rodamco-Westfield SE			(1.00)%			Quarterly						6/20/29			724,000			EUR			359			13,053			(12,694)
			UPC Holding			(5.00)%			Quarterly						6/20/29			263,000			EUR			(32,986)			(40,295)			7,309
			UPC Holding			(5.00)%			Quarterly						6/20/29			15,000			EUR			(1,881)			(1,745)			(136)
			Virgin Media			(5.00)%			Quarterly						6/20/29			29,000			EUR			(1,286)			(1,391)			105
			Virgin Media			(5.00)%			Quarterly						6/20/29			288,000			EUR			(12,769)			(9,007)			(3,762)
			Virgin Media			(5.00)%			Quarterly						6/20/29			72,000			EUR			(3,192)			(2,159)			(1,033)
			Virgin Media			(5.00)%			Quarterly						6/20/29			43,000			EUR			(1,906)			(1,856)			(50)
			Vodafone Group PLC			(1.00)%			Quarterly						6/20/29			1,003,000			EUR			(20,825)			(17,981)			(2,844)
			Volkswagen AG			(1.00)%			Quarterly						6/20/29			1,174,000			EUR			(10,449)			(4,761)			(5,688)
			Whirlpool Corp.			(1.00)%			Quarterly						6/20/29			217,000						4,296			2,724			1,572
			Whirlpool Corp.			(1.00)%			Quarterly						6/20/29			42,000						832			528			304
			Whirlpool Corp.			(1.00)%			Quarterly						6/20/29			72,000						1,425			1,204			221
			Whirlpool Corp.			(1.00)%			Quarterly						6/20/29			145,000						2,871			1,698			1,173
			Whirlpool Corp.			(1.00)%			Quarterly						6/20/29			217,000						4,296			3,006			1,290

42			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Credit Default Swap Contracts (continued)

			Description			Annual Payment Rate Received (Paid)			Payment Frequency						Maturity Date			Notional Amounta						Value			Upfront Payments (Receipts)			Unrealized Appreciation (Depreciation)			Ratingb
			Centrally Cleared Swap Contracts (continued)
			Contracts to Buy Protectionc (continued)
			Single Name (continued)
			Whirlpool Corp.			(1.00)%			Quarterly						6/20/29			72,000						$1,425			$1,082			$343
			Whirlpool Corp.			(1.00)%			Quarterly						6/20/29			363,000						7,187			4,408			2,779
			Ziggo			(5.00)%			Quarterly						6/20/29			422,000			EUR			(24,109)			(17,297)			(6,812)
			Contracts to Sell Protectionc,d
			Single Name
			Virgin Media			5.00%			Quarterly						6/20/27			115,000			EUR			9,002			8,451			551			B+
			Traded Index
			CDX.EM.41e			1.00%			Quarterly						6/20/29			1,000,000						(27,123)			(30,550)			3,427			Investment Grade
			CDX.NA.HY.42e			5.00%			Quarterly						6/20/29			3,000,000						203,265			216,550			(13,285)			Non-Investment Grade
			CDX.NA.IG.42e			1.00%			Quarterly						6/20/29			26,000,000						583,071			597,507			(14,436)			Investment Grade
			ITRX.EURe			1.00%			Quarterly						6/20/29			30,000,000			EUR			716,262			734,715			(18,453)			Investment Grade
			ITRX.EUR.XOVERe			5.00%			Quarterly						6/20/29			12,000,000			EUR			1,117,097			1,223,110			(106,013)			Sub-Investment Grade
			Total Centrally Cleared Swap Contracts																					$1,922,888			$2,496,134			$(573,246)
												Counterparty
			OTC Swap Contracts
			Contracts to Buy Protectionc
			Single Name
			American Airlines Inc.			(5.00)%			Quarterly			GSCO			12/20/24			14,000						$(427)			$551			$(978)
			American Airlines Inc.			(5.00)%			Quarterly			GSCO			12/20/24			339,000						(10,348)			7,373			(17,721)
			Bank of China			(1.00)%			Quarterly			GSCO			6/20/26			288,000						(4,190)			(2,921)			(1,269)
			Bank of China			(1.00)%			Quarterly			GSCO			6/20/29			940,000						(15,358)			(6,221)			(9,137)
			Bank of China			(1.00)%			Quarterly			JPHQ			6/20/26			144,000						(2,095)			(769)			(1,326)
			Bank of China			(1.00)%			Quarterly			JPHQ			6/20/26			144,000						(2,095)			(742)			(1,353)
			Bank of China			(1.00)%			Quarterly			JPHQ			6/20/29			362,000						(5,914)			(2,557)			(3,357)
			Bank of China			(1.00)%			Quarterly			MSCS			6/20/26			72,000						(1,047)			(480)			(567)
			Bank of China			(1.00)%			Quarterly			MSCS			6/20/26			72,000						(1,047)			(439)			(608)
			Bayerische			(1.00)%			Quarterly			MSCO			12/20/25			146,000			EUR			(2,271)			(951)			(1,320)
			China Construction			(1.00)%			Quarterly			GSCO			6/20/29			651,000						(11,160)			(4,308)			(6,852)
			China Construction			(1.00)%			Quarterly			JPHQ			6/20/26			288,000						(4,466)			(2,921)			(1,545)
			China Construction			(1.00)%			Quarterly			JPHQ			6/20/26			216,000						(3,349)			(1,113)			(2,236)
			China Construction			(1.00)%			Quarterly			JPHQ			6/20/26			216,000						(3,349)			(1,112)			(2,237)
			China Construction			(1.00)%			Quarterly			JPHQ			6/20/29			796,000						(13,646)			(5,621)			(8,025)
			Government of Argentina			(5.00)%			Quarterly			CITI			12/20/26			195,000						61,119			88,264			(27,145)
			Government of Argentina			(5.00)%			Quarterly			GSCO			12/20/26			778,000						243,848			216,471			27,377
			Government of Egypt			(1.00)%			Quarterly			BZWS			12/20/24			152,000						1,375			4,980			(3,605)
			Government of Egypt			(1.00)%			Quarterly			CITI			12/20/24			375,000						3,391			25,619			(22,228)
			Government of Egypt			(1.00)%			Quarterly			CITI			6/20/26			197,000						9,087			45,183			(36,096)
			Government of Korea			(1.00)%			Quarterly			BZWS			6/20/29			1,056,000						(25,760)			(22,295)			(3,465)
			Government of Korea			(1.00)%			Quarterly			GSCO			6/20/29			2,843,000						(88,410)			(82,944)			(5,466)
			Government of Mexico			(1.00)%			Quarterly			CITI			6/20/29			1,332,000						(5,901)			(585)			(5,316)
			Government of South Africa			(1.00)%			Quarterly			GSCO			6/20/29			400,000						22,941			20,432			2,509
			Government of Turkey			(1.00)%			Quarterly			GSCO			6/20/27			794,000						15,487			27,953			(12,466)
			Industrial and Commercial Bank of China			(1.00)%			Quarterly			GSCO			6/20/29			1,306,000						(22,672)			(8,643)			(14,029)
			Industrial and Commercial Bank of China			(1.00)%			Quarterly			JPHQ			6/20/26			144,000						(2,124)			(714)			(1,410)
			Industrial and Commercial Bank of China			(1.00)%			Quarterly			JPHQ			6/20/29			145,000						(2,517)			(1,024)			(1,493)

franklintempleton.com			Annual Report			43

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Credit Default Swap Contracts (continued)

			Description			Annual Payment Rate Received (Paid)			Payment Frequency			Counterparty			Maturity Date			Notional Amounta						Value			Upfront Payments (Receipts)			Unrealized Appreciation (Depreciation)			Ratingb
			OTC Swap Contracts (continued)
			Contracts to Buy Protectionc (continued)
			Single Name (continued)
			Industrial and Commercial Bank of China			(1.00)%			Quarterly			MSCS			6/20/26			144,000						$(2,124)			$(822)			$(1,302)
			JFE Holdings Inc.			(1.00)%			Quarterly			GSCO			6/20/29			187,961,000			JPY			(36,374)			(37,138)			764
			JFE Holdings Inc.			(1.00)%			Quarterly			MSCO			6/20/29			42,882,000			JPY			(8,299)			(8,626)			327
			Kawasaki Heavy Industries Ltd.			(1.00)%			Quarterly			​MSCO			6/20/29			198,470,000			JPY			(40,557)			(39,251)			(1,306)
			Kobe Steel Ltd.			(1.00)%			Quarterly			​MSCO			6/20/29			181,198,000			JPY			(25,993)			(26,714)			721
			Lincoln National Corp			(1.00)%			Quarterly			BZWS			6/20/25			72,000						(597)			608			(1,205)
			Lincoln National Corp			(1.00)%			Quarterly			BZWS			6/20/25			72,000						(597)			608			(1,205)
			Mitsui O.S.K. Lines Ltd.			(1.00)%			Quarterly			GSCO			6/20/29			137,356,000			JPY			(20,009)			(19,774)			(235)
			Mitsui O.S.K. Lines Ltd.			(1.00)%			Quarterly			​MSCO			6/20/29			57,834,000			JPY			(8,425)			(7,948)			(477)
			Nippon Paper Industries Co.			(1.00)%			Quarterly			JPHQ			12/20/25			7,366,000			JPY			(279)			(38)			(241)
			Nippon Paper Industries Co.			(1.00)%			Quarterly			MSCO			12/20/25			21,750,000			JPY			(823)			340			(1,163)
			Nippon Paper Industries Co.			(1.00)%			Quarterly			MSCO			12/20/25			33,598,000			JPY			(1,271)			525			(1,796)
			Nippon Paper Industries Co.			(1.00)%			Quarterly			​MSCO			6/20/29			29,759,000			JPY			6,543			6,552			(9)
			Nippon Paper Industries Co.			(1.00)%			Quarterly			​MSCO			6/20/29			113,236,000			JPY			24,895			14,341			10,554
			Rakuten Group Inc.			(1.00)%			Quarterly			BOFA			6/20/27			11,711,000			JPY			4,326			3,375			951
			Rakuten Group Inc.			(1.00)%			Quarterly			BZWS			6/20/24			43,477,000			JPY			(623)			1,123			(1,746)
			Rakuten Group Inc.			(1.00)%			Quarterly			BZWS			6/20/25			6,895,000			JPY			(96)			1,339			(1,435)
			Rakuten Group Inc.			(1.00)%			Quarterly			BZWS			6/20/25			20,947,000			JPY			(293)			4,465			(4,758)
			Rakuten Group Inc.			(1.00)%			Quarterly			CITI			6/20/25			14,667,000			JPY			(205)			1,374			(1,579)
			Rakuten Group Inc.			(1.00)%			Quarterly			CITI			6/20/27			11,711,000			JPY			4,325			3,483			842
			Rakuten Group Inc.			(1.00)%			Quarterly			JPHQ			6/20/25			16,041,000			JPY			(224)			1,274			(1,498)
			Rakuten Group Inc.			(1.00)%			Quarterly			JPHQ			6/20/25			14,053,000			JPY			(196)			2,834			(3,030)
			Rakuten Group Inc.			(1.00)%			Quarterly			​MSCO			6/20/25			3,000,000			JPY			(42)			276			(318)
			Rakuten Group Inc.			(1.00)%			Quarterly			​MSCO			6/20/25			6,444,000			JPY			(90)			435			(525)
			Rakuten Group Inc.			(1.00)%			Quarterly			​MSCO			6/20/25			7,271,000			JPY			(102)			890			(992)
			Rakuten Group Inc.			(1.00)%			Quarterly			​MSCO			6/20/25			7,549,000			JPY			(105)			908			(1,013)
			Rakuten Group Inc.			(1.00)%			Quarterly			​MSCO			6/20/25			12,200,000			JPY			(170)			1,081			(1,251)
			Rakuten Group Inc.			(1.00)%			Quarterly			​MSCO			6/20/25			14,482,000			JPY			(202)			1,141			(1,343)
			Rakuten Group Inc.			(1.00)%			Quarterly			​MSCO			6/20/25			14,542,000			JPY			(203)			1,811			(2,014)
			Softbank Group Corp.			(1.00)%			Quarterly			BZWS			6/20/28			29,008,000			JPY			3,674			15,941			(12,267)
			Softbank Group Corp.			(1.00)%			Quarterly			GSCO			6/20/28			62,367,000			JPY			7,899			32,991			(25,092)
			Univision Communications Inc.			(5.00)%			Quarterly			GSCO			6/20/29			72,000						(7,969)			(6,902)			(1,067)
			Univision Communications Inc.			(5.00)%			Quarterly			GSCO			6/20/29			58,000						(6,419)			(5,716)			(703)
			Univision Communications Inc.			(5.00)%			Quarterly			GSCO			6/20/29			29,000						(3,210)			(3,063)			(147)
			Univision Communications Inc.			(5.00)%			Quarterly			GSCO			6/20/29			29,000						(3,210)			(3,000)			(210)
			Univision Communications Inc.			(5.00)%			Quarterly			GSCO			6/20/29			29,000						(3,210)			(2,986)			(224)
			Univision Communications Inc.			(5.00)%			Quarterly			GSCO			6/20/29			29,000						(3,210)			(2,867)			(343)
			Univision Communications Inc.			(5.00)%			Quarterly			GSCO			6/20/29			29,000						(3,210)			(2,866)			(344)
			Univision Communications Inc.			(5.00)%			Quarterly			GSCO			6/20/29			22,000						(2,435)			(2,268)			(167)
			Contracts to Sell Protectionc,d
			Single Name
			Government of Egypt			1.00%			Quarterly			GSCO			6/20/29			2,059,000						$(369,891)			$(342,101)			$(27,790)			B−
			Total OTC Swap Contracts																					$(369,899)			$(123,899)			$(246,000)
			Total Credit Default Swap Contracts																					$1,552,989			$2,372,235			$(819,246)

44			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Credit Default Swap Contracts (continued)

aIn U.S. dollars unless otherwise indicated. For contracts to sell protection, the notional amount is equal to the maximum potential amount of the future payments and no recourse provisions have been entered into in association with the contracts.

bBased on Standard and Poor’s (S&P) Rating for single name swaps and internal ratings for index swaps. Internal ratings based on mapping into equivalent ratings from external vendors.

cPerformance triggers for settlement of contract include default, bankruptcy or restructuring for single name swaps and failure to pay or bankruptcy of the underlying securities for traded index swaps.

dThe Fund enters contracts to sell protection to create a long credit position.

eA portion or all of the contracts are owned by K2 Holdings Investment Corp., a wholly-owned subsidiary of the Fund. See Note 1(g).

At May 31, 2024, the Fund had the following interest rate swap contracts outstanding. See Note 1(d).

Interest Rate Swap Contracts

Description

Payment Frequency

Maturity Date

Notional Amount*

Value/Unrealized Appreciation (Depreciation)

Centrally Cleared Swap Contracts

Receive Fixed 10.42% Pay Floating BRLCDI

Annually

1/04/27

6,000,000

BRL

$(26,809)

Receive Fixed 10.81% Pay Floating BRLCDI

Annually

1/04/27

8,000,000

BRL

(7,856)

Receive Fixed 10.90% Pay Floating BRLCDI

Annually

1/04/27

8,711,957

BRL

(5,645)

Receive Fixed 13.29% Pay Floating BRLCDI

Annually

1/04/27

2,980,054

BRL

26,158

Receive Fixed 13.41% Pay Floating BRLCDI

Annually

1/04/27

5,875,629

BRL

55,113

Receive Fixed 13.47% Pay Floating BRLCDI

Annually

1/04/27

4,395,970

BRL

42,646

Receive Fixed 8.78% Pay Floating Banxico Mexico 1 Month Rate

Monthly

10/19/27

72,800,000

MXN

120,796

Receive Fixed 4.15% Pay Floating rate Overnight SOFR

Annually

11/22/28

5,700,000

(43,381)

Receive Fixed 3.753% Pay Floating rate Overnight SOFR

Annually

1/19/29

582,800

(13,860)

Receive Fixed 4.0082% Pay Floating rate Overnight SOFR

Annually

2/15/29

1,740,000

(22,765)

Receive Fixed 4.0698% Pay Floating rate Overnight SOFR

Annually

2/21/29

1,740,000

(18,191)

Receive Fixed 3.93% Pay Floating rate Overnight SOFR

Annually

3/15/29

5,469,600

(88,874)

Receive Fixed 4.09% Pay Floating rate Overnight SOFR

Annually

4/03/29

3,480,000

(31,829)

Receive Fixed 4.29% Pay Floating rate Overnight SOFR

Annually

4/12/29

2,175,000

(1,205)

Receive Fixed 4.40% Pay Floating rate Overnight SOFR

Annually

4/17/29

2,103

8

Receive Fixed 4.40% Pay Floating rate Overnight SOFR

Annually

4/17/29

2,100,398

8,851

Receive Fixed 4.28% Pay Floating rate Overnight SOFR

Annually

5/14/29

2,750,000

(2,246)

Receive Fixed 4.27% Pay Floating rate Overnight SOFR

Annually

5/15/29

3,300,000

(4,062)

Receive Fixed 8.47% Pay Floating Banxico Mexico 1 Month Rate

Monthly

10/12/32

19,000,000

MXN

(56,186)

Receive Fixed 8.72% Pay Floating Banxico Mexico 1 Month Rate

Monthly

10/12/32

21,700,000

MXN

(44,994)

Receive Fixed 7.97% Pay Floating Banxico Mexico 1 Month Rate

Monthly

10/06/33

26,200,000

MXN

(131,159)

Receive Fixed 10.14% Pay Floating rate 3-Month-JIBAR

Quarterly

6/19/34

17,000,000

ZAR

13,791

franklintempleton.com			Annual Report			45

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Interest Rate Swap Contracts (continued)

Description

Payment Frequency

Maturity Date

Notional Amount*

Value/Unrealized Appreciation (Depreciation)

Centrally Cleared Swap Contracts (continued)

Receive Fixed 6.96% Pay Floating rate 6-Month-BUBOR

Annually

6/19/34

315,038,277

HUF

$19,262

Receive Fixed 6.96% Pay Floating rate 6-Month-BUBOR

Annually

6/19/34

92,605,164

HUF

5,754

Total Interest Rate Swap Contracts

$(206,683)

*In U.S. dollars unless otherwise indicated.

At May 31, 2024, the Fund had the following total return swap contracts outstanding. See Note 1(d).

Total Return Swap Contracts

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts

Currency Contracts - Longa

FX G10 Carry

Fixed 0.00%

Monthly

CITI

6/28/24

3,685,801

$18,962

FX G10 Carry

Fixed 0.00%

Monthly

CITI

6/28/24

2,728,654

14,037

FX G10 Carry

Fixed 0.00%

Monthly

CITI

6/28/24

470,246

2,420

FX G10 Carry

Fixed 0.00%

Monthly

CITI

6/28/24

7,415,818

85,533

FX G10 Value

Fixed 0.03%

Monthly

CITI

6/28/24

13,634,351

50,691

FX G10 Value

Fixed 0.03%

Monthly

CITI

6/28/24

10,093,571

37,527

FX G10 Value

Fixed 0.03%

Monthly

CITI

6/28/24

1,726,189

6,552

FX G10 Value

Fixed 0.03%

Monthly

CITI

6/28/24

27,681,198

15,484

231,206

Equity Contracts - Longa

3i Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

279,040

GBP

133,898

4imprint Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

6/03/25

259,114

GBP

129,204

A1 Telekom Austria AG

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

13,566

EUR

1,575

A2A SpA

Euro STR + 0.35%

Monthly

JPHQ

8/12/24

232,776

EUR

21,186

AbitareIn

Euro STR + 0.35%

Monthly

JPHQ

1/08/25

56,713

EUR

(1,391)

AcadeMedia AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

1,647,385

SEK

16,437

AddLife AB

1-Week STIBOR + 0.28%

Monthly

SEBA

8/02/24

5,157,301

SEK

119,005

ADvTECH Ltd.

1-Day SABOR + 0.30%

Monthly

MSCS

7/17/24

1,765,587

ZAR

36,429

Adyen

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

167,543

EUR

(7,251)

Aeci Limited

1-Day SABOR + 0.70%

Monthly

MSCS

7/17/24

7,530,053

ZAR

(34,773)

AFRY AB

1-Week STIBOR + 0.28%

Monthly

SEBA

3/13/25

2,187,161

SEK

20,639

Ageas

Euro STR + 0.35%

Monthly

JPHQ

5/01/25

173,164

EUR

29,076

Airtel Africa PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

107,495

GBP

4,350

Aker Solutions ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

7/17/24

5,223,936

NOK

54,182

AkzoNobel

Euro STR + 0.35%

Monthly

JPHQ

4/25/25

227,469

EUR

7,555

Alfa Financial Software

1-Day SONIA + 0.35%

Monthly

MSCS

11/18/24

61,683

GBP

16,995

Alior Bank SA

1-Day FEDEF + 1.25%

Monthly

MSCO

1/06/25

234,851

(8,351)

Alleima AB

1-Week STIBOR + 0.275%

Monthly

SEBA

12/06/24

2,485,177

SEK

(12,617)

Alligo AB

1-Week STIBOR + 0.275%

Monthly

SEBA

5/15/25

996,721

SEK

1,626

ALSO Holding AG

1-Day SARON + 0.35%

Monthly

JPHQ

7/15/24

507,333

CHF

112,407

Alzchem Group AG

Euro STR + 0.35%

Monthly

JPHQ

11/22/24

22,358

EUR

18,004

Amadeus Fire AG

Euro STR + 0.35%

Monthly

JPHQ

1/31/25

200,810

EUR

(19,007)

Ambea AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

2,384,079

SEK

206,205

46			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

Amedeo Air Four Plus Ltd.

1-Day SONIA + 0.35%

Monthly

MSCO

4/09/25

40,693

GBP

$5,734

Anadolu Efes

1-Day FEDEF + 1.25%

Monthly

MSCS

1/22/25

46,969

19,891

Andritz AG

Euro STR + 0.35%

Monthly

JPHQ

7/15/24

273,194

EUR

419

Anora Group PLC

Euro STR + 0.275%

Monthly

SEBA

12/23/24

73,713

EUR

3,582

AO World PLC

1-Day SONIA + 0.35%

Monthly

MSCS

12/02/24

202,586

GBP

120,338

Arcadis

Euro STR + 0.35%

Monthly

JPHQ

9/22/24

174,353

EUR

1,344

Arcelormittal SA

Euro STR + 0.25%

Monthly

JPHQ

2/28/25

269,560

EUR

(24,487)

Arctic

1-Day FEDEF + 0.30%

Monthly

MSCS

11/27/24

85,581

18,111

Arjo AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

5,773,646

SEK

29,227

ARYZTA

1-Day SARON + 0.35%

Monthly

JPHQ

4/26/25

587,450

CHF

101,828

ASBIS Kypros Ltd.

1-Day FEDEF + 0.30%

Monthly

MSCS

7/12/24

20,740

241

Ascencio

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

95,311

EUR

(1,182)

Ascom Holding AG

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

191,200

CHF

(19,123)

ASML Holding NV

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

127,296

EUR

10,917

Asseco Poland SA

1-Day FEDEF + 0.30%

Monthly

MSCS

7/17/24

237,632

32,569

Associated British Foods PLC

1-Day SONIA + 0.35%

Monthly

MSCS

8/23/24

215,146

GBP

26,561

Atea ASA

1-Week NIBOR + 0.275%

Monthly

SEBA

3/18/25

1,367,891

NOK

9,504

Atoss Software AG

Euro STR + 0.35%

Monthly

JPHQ

8/01/24

232,754

EUR

31,031

Atresmedia Corporacion de Medios de Comunicacion SA

1-Day EONIA + 0.35%

Monthly

MSCS

7/17/24

262,615

EUR

124,112

Attendo AB

1-Week STIBOR + 0.28%

Monthly

SEBA

1/08/25

2,765,774

SEK

79,695

Audax Renovables SA

1-Day EONIA + 0.35%

Monthly

MSCS

4/24/25

107,872

EUR

65,212

Aumann AG

Euro STR + 0.35%

Monthly

JPHQ

1/22/25

80,532

EUR

8,836

Austevoll Seafood ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

7/12/24

1,267,928

NOK

(4,560)

Autoneum

1-Day SARON + 0.35%

Monthly

JPHQ

11/27/24

252,438

CHF

(22,737)

AVI Ltd.

1-Day SABOR + 0.70%

Monthly

MSCS

10/03/24

8,922,378

ZAR

(29,186)

B&M European Value Retail SA

1-Day SONIA + 0.35%

Monthly

MSCO

1/16/25

134,339

GBP

7,376

B&S Group SA

Euro STR + 0.35%

Monthly

JPHQ

1/16/25

73,013

EUR

23,557

B2 Impact ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

7/17/24

1,371,786

NOK

23,471

Bakkavor Group PLC

1-Day SONIA + 0.35%

Monthly

MSCO

5/15/25

22,138

GBP

1,767

Balfour Beatty

1-Day SONIA + 0.35%

Monthly

MSCS

9/18/24

378,898

GBP

48,943

Banca Ifis SpA

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

468,058

EUR

152,703

Bank of Georgia Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/31/24

289,600

GBP

13,665

Barclays PLC

1-Day SONIA + 0.44%

Monthly

MSCS

7/17/24

176,450

GBP

93,880

Barr AG

1-Day SONIA + 0.35%

Monthly

MSCO

5/22/25

64,335

GBP

2,068

Basilea Pharmaceutica AG

Euro STR + 6.75%

Monthly

JPHQ

5/08/25

372,424

CHF

8,477

Bausch Health Co.

​3-Month SOFR + 0.51%

​Quarterly

GSCO

5/23/25

67,547

2,794

Bavarian Nordic A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

11/27/24

2,040,228

DKK

52,629

BAWAG Group AG

Euro STR + 0.35%

Monthly

JPHQ

4/03/25

213,502

EUR

4,485

BB Biotech AG

1-Day SARON + 0.35%

Monthly

JPHQ

4/11/25

250,978

CHF

(15,549)

BE Group AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

1,166,148

SEK

(51,392)

Bechtle AG

Euro STR + 0.35%

Monthly

JPHQ

11/06/24

265,936

EUR

(2,592)

Bekaert SA

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

288,562

EUR

(3,729)

Bell Food Group AG

1-Day SARON + 0.35%

Monthly

JPHQ

7/17/24

60,958

CHF

4,591

Benefit

1-Day FEDEF + 1.25%

Monthly

MSCS

9/26/24

14,731

68

Betsson AB

1-Week STIBOR + 0.275%

Monthly

SEBA

7/17/24

7,154,493

SEK

81,254

franklintempleton.com			Annual Report			47

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

Betsson AB

1-Week STIBOR + 0.275%

Monthly

SEBA

7/17/24

​66,525

SEK

$23,721

BHG Group AB

1-Week STIBOR + 0.28%

Monthly

SEBA

11/27/24

2,115,809

SEK

49,392

BIC

1-Day EONIA + 0.30%

Monthly

MSCS

4/17/25

404,564

EUR

56,347

Bico Group

1-Week STIBOR + 0.28%

Monthly

SEBA

11/27/24

1,272,684

SEK

1,857

Bilfinger SE

Euro STR + 0.35%

Monthly

JPHQ

12/06/24

385,606

EUR

70,135

BioGaia AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

3,261,723

SEK

84,931

BKW AG

1-Day SARON + 0.35%

Monthly

JPHQ

12/12/24

321,789

CHF

(15,350)

Bodycote PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/05/24

258,148

GBP

65,903

Bogdanka SA

1-Day FEDEF + 0.30%

Monthly

MSCS

8/19/24

108,690

(15,456)

Bonheur ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

8/28/24

654,321

NOK

4,079

Boozt AB

1-Week STIBOR + 0.275%

Monthly

SEBA

9/19/24

2,283,832

SEK

41,908

Borregaard

1-Week NIBOR + 0.28%

Monthly

SEBA

7/05/24

836,217

NOK

301

Bouygues

1-Day EONIA + 0.30%

Monthly

MSCO

3/14/25

351,634

EUR

(16,792)

BPER Banca SpA

Euro STR + 0.35%

Monthly

JPHQ

9/25/24

167,426

EUR

86,281

Bpost

Euro STR + 0.35%

Monthly

JPHQ

11/07/24

208,174

EUR

(17,412)

Brederode

Euro STR + 0.35%

Monthly

JPHQ

11/21/24

20,116

EUR

649

Breedon Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

292,134

GBP

41,958

British Land Co. PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/07/25

397,782

GBP

107,380

Bulten AB

1-Week STIBOR + 0.275%

Monthly

SEBA

10/18/24

43,563

SEK

1,330

Buzzi Unicem SpA

Euro STR + 0.35%

Monthly

JPHQ

8/12/24

276,117

EUR

90,523

BW LPG Ltd.

1-Week NIBOR + 0.275%

Monthly

SEBA

4/15/25

2,041,155

NOK

90,649

Cairn Homes PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

145,391

GBP

88,644

CaixaBank SA

1-Day EONIA + 0.35%

Monthly

MSCS

8/21/24

128,664

EUR

43,198

Card Factory PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

191,502

GBP

10,598

Care Property Invest

Euro STR + 0.35%

Monthly

JPHQ

12/16/24

20,064

EUR

4

Cargotec OYJ

Euro STR + 0.28%

Monthly

SEBA

8/23/24

209,064

EUR

173,814

Carlsberg Group

1-Week CIBOR + 0.28%

Monthly

SEBA

9/12/24

1,239,000

DKK

(10,755)

Carmila

1-Day EONIA + 0.30%

Monthly

MSCS

8/07/24

152,172

EUR

34,068

Carrefour

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

299,581

EUR

(22,392)

Catana Group

1-Day EONIA + 0.30%

Monthly

MSCS

12/02/24

92,983

EUR

(3,924)

Cbrain A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

7/17/24

1,994,295

DKK

(35,629)

CCC

1-Day FEDEF + 1.25%

Monthly

MSCO

4/03/25

87,646

73,017

Ceconomy AG

Euro STR + 0.35%

Monthly

JPHQ

7/05/24

276,862

EUR

103,157

Cementir Holding NV

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

189,331

EUR

61,144

Centrica PLC ORD

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

446,255

GBP

72,948

CEWE Stiftung & Co. KGaA

Euro STR + 0.35%

Monthly

JPHQ

3/18/25

85,362

EUR

5,157

Clarkson PLC

1-Day SONIA + 0.35%

Monthly

MSCS

5/06/25

181,383

GBP

78,998

Clas Ohlson AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

2,903,777

SEK

214,930

Cliq Digital AG

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

188,887

EUR

(134,430)

Cloetta AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

432,657

SEK

2,313

Coca-Cola Europacific Partners PLC

1-Day SONIA + 0.30%

Monthly

JPHQ

10/11/24

137,233

EUR

20,021

Coca-Cola HBC AG-DI

1-Day SONIA + 0.35%

Monthly

MSCS

12/04/24

242,057

GBP

41,677

Colruyt Group NV

Euro STR + 0.35%

Monthly

JPHQ

12/23/24

349,683

EUR

47,050

Commerzbank AG

Euro STR + 0.35%

Monthly

JPHQ

12/18/24

196,048

EUR

86,766

Computacenter PLC ORD

1-Day SONIA + 0.35%

Monthly

MSCS

7/15/24

476,700

GBP

48,640

48			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

Conduit Holdings Ltd.

1-Day SONIA + 0.35%

Monthly

MSCS

10/17/24

453,064

GBP

$61,530

Construcciones y Auxiliar de Ferrocarriles

1-Day EONIA + 0.35%

Monthly

MSCS

7/17/24

253,041

EUR

8,083

Coor Service Management Holding AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

487,339

SEK

4,186

Corem Property Group

1-Week STIBOR + 0.28%

Monthly

SEBA

11/27/24

3,402,896

SEK

74,130

Costain Group

1-Day SONIA + 0.35%

Monthly

MSCS

11/15/24

46,563

GBP

18,840

Costain Group

1-Day SONIA + 0.35%

Monthly

MSCS

11/27/24

568

GBP

368

Cranswick PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/29/24

22,658

GBP

533

Currys PLC

1-Day SONIA + 0.35%

Monthly

MSCS

11/27/24

104,135

GBP

41,026

Dampskibsselskabet Norden A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

7/17/24

1,144,755

DKK

(13,821)

Danieli & C Officine Meccaniche SpA

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

415,069

EUR

217,361

Danske Bank A/S

1-Week CIBOR + 0.275%

Monthly

SEBA

11/13/24

1,616,416

DKK

37,260

Darktrace PLC

1-Day SONIA + 0.35%

Monthly

MSCS

12/04/24

92,769

GBP

35,686

Datatec Ltd.

1-Day SABOR + 0.70%

Monthly

MSCS

11/27/24

272,707

ZAR

22

DCC PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

227,457

GBP

62,726

Deceuninck

Euro STR + 0.35%

Monthly

JPHQ

11/07/24

50,537

EUR

6,579

Dedicare AB

1-Week STIBOR + 0.275%

Monthly

SEBA

5/27/25

1,033,895

SEK

(42,945)

Derichebourg SA

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

95,339

EUR

13,523

Deutsche Bank AG

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

270,634

EUR

114,437

Deutsche Beteiligungs AG

Euro STR + 0.35%

Monthly

JPHQ

12/19/24

124,629

EUR

(3,212)

Deutsche Lufthansa AG

Euro STR + 0.35%

Monthly

JPHQ

9/06/24

25,606

EUR

(2,531)

Deutz AG

Euro STR + 0.35%

Monthly

JPHQ

7/13/24

211,946

EUR

(10,106)

Develia SA

1-Day FEDEF + 1.25%

Monthly

MSCO

12/19/24

48,842

13,479

Digital Value SpA

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

122,561

EUR

13,554

Diys Fastigheter AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/12/24

737,015

SEK

4,257

D’leteren Group

Euro STR + 0.35%

Monthly

JPHQ

5/30/25

101,265

EUR

(940)

DO & CO AG

Euro STR + 0.35%

Monthly

JPHQ

9/06/24

80,281

EUR

26,007

DOF Group ASA

1-Week NIBOR + 0.275%

Monthly

SEBA

3/06/25

1,620,192

NOK

56,605

Dom Development

1-Day FEDEF + 1.25%

Monthly

MSCS

11/28/24

42,158

6,467

Dormakaba

1-Day SARON + 0.35%

Monthly

JPHQ

3/04/25

149,985

CHF

6,022

Drax Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

468,228

GBP

(29,567)

Duerr AG

Euro STR + 0.35%

Monthly

JPHQ

2/17/25

118,150

EUR

13,174

Dunelm Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

4/03/25

90,273

GBP

1,324

Duni AB

1-Week STIBOR + 0.275%

Monthly

SEBA

1/16/25

1,211,163

SEK

5,661

E.ON SE

Euro STR + 0.35%

Monthly

JPHQ

8/19/24

237,935

EUR

10,679

Easyjet PLC

1-Day SONIA + 0.35%

Monthly

MSCO

7/17/24

480,655

GBP

(66,061)

Ebro Foods

1-Day EONIA + 0.35%

Monthly

MSCO

12/04/24

233,759

EUR

14,136

Econocom Group SE

Euro STR + 0.35%

Monthly

JPHQ

1/08/25

7,222

EUR

(485)

Econocom Group SE

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

69,817

EUR

(7,014)

EFG International AG

1-Day SARON + 0.35%

Monthly

JPHQ

7/17/24

447,458

CHF

114,964

Elecnor SA

1-Day EONIA + 0.35%

Monthly

MSCS

7/17/24

48,952

EUR

3,754

Electrolux Professional AB

1-Week STIBOR + 0.275%

Monthly

SEBA

5/08/25

2,339,923

SEK

18,212

Elektrotim

1-Day FEDEF + 1.25%

Monthly

MSCS

11/28/24

29,213

7,255

Elementis PLC

1-Day SONIA + 0.35%

Monthly

MSCS

9/30/24

260,601

GBP

13,290

franklintempleton.com			Annual Report			49

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

Elis SA

1-Day EONIA + 0.30%

Monthly

MSCS

2/26/25

139,726

EUR

$45,192

Elmera Group ASA

1-Week NIBOR + 0.275%

Monthly

SEBA

1/27/25

922,042

NOK

2,825

Elmos Semiconductor SE

Euro STR + 0.35%

Monthly

JPHQ

7/18/24

321,361

EUR

63,587

Elopak ASA

1-Week NIBOR + 0.275%

Monthly

SEBA

5/08/25

763,280

NOK

839

Enad Global 7 AB

1-Week STIBOR + 0.28%

Monthly

SEBA

11/27/24

1,851,372

SEK

(85,685)

Endesa SA

1-Day EONIA + 0.35%

Monthly

MSCS

1/13/25

410,626

EUR

(2,035)

Enea AB

1-Day FEDEF + 0.30%

Monthly

MSCS

7/17/24

241,581

33,675

Enel Group

Euro STR + 0.35%

Monthly

JPHQ

10/28/24

214,979

EUR

22,136

Engie SA

1-Day EONIA + 0.30%

Monthly

MSCS

8/30/24

272,225

EUR

12,428

Engie SA

1-Day EONIA + 0.40%

Monthly

MSCO

9/25/24

1,681,341

EUR

(41,732)

EnQuest PLC

1-Day SONIA + 0.35%

Monthly

MSCS

11/27/24

327,487

GBP

(17,303)

Equity Flows

Fixed 0.10%

Monthly

JPHQ

6/28/24

930,470

19,917

Equity Flows

Fixed 0.10%

Monthly

JPHQ

6/28/24

1,254,887

26,862

Equity Flows

Fixed 0.10%

Monthly

JPHQ

6/28/24

167,556

3,600

Equity Flows

Fixed 0.10%

Monthly

JPHQ

6/28/24

2,540,960

62,791

Equity Low Beta

Fixed (0.19)%

Monthly

DBAB

6/28/24

1,957,726

11,937

Equity Low Beta

Fixed (0.19)%

Monthly

DBAB

6/28/24

1,449,627

8,840

Equity Low Beta

Fixed (0.19)%

Monthly

DBAB

6/28/24

259,512

1,457

Equity Low Beta

Fixed (0.19)%

Monthly

DBAB

6/28/24

3,982,773

14,170

Equity Momentum

Fixed (0.19)%

Monthly

DBAB

6/28/24

3,235,715

47,693

Equity Momentum

Fixed (0.19)%

Monthly

DBAB

6/28/24

553,478

7,889

Equity Momentum

Fixed (0.19)%

Monthly

DBAB

6/28/24

4,371,801

64,438

Equity Momentum

Fixed (0.19)%

Monthly

DBAB

6/28/24

8,827,388

145,390

Equity Value

Fixed (0.19)%

Monthly

DBAB

6/28/24

15,195,820

209,832

Equity Value

Fixed (0.19)%

Monthly

DBAB

6/28/24

7,533,865

81,885

Equity Value

Fixed (0.19)%

Monthly

DBAB

6/28/24

5,576,478

63,319

Equity Value

Fixed (0.19)%

Monthly

DBAB

6/28/24

948,148

10,305

Ericsson

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

550,592

SEK

3,285

Eurazeo SE

1-Day EONIA + 0.30%

Monthly

MSCO

5/20/25

201,624

EUR

(672)

Eurobio Scientific SA

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

60,463

EUR

(17,681)

Eurocash

1-Day FEDEF + 1.25%

Monthly

MSCS

1/06/25

126,289

(20,062)

Eurocommercial Properties NV

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

258,332

EUR

40,185

EVS Broadcast Equipment SA

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

69,694

EUR

6,159

Fagron NV

Euro STR

Monthly

JPHQ

8/19/24

213,732

EUR

28,350

Finnair OYJ

Euro STR + 0.275%

Monthly

SEBA

4/15/25

101,280

EUR

(6,852)

FirstGroup PLC

1-Day SONIA + 0.35%

Monthly

MSCS

8/24/24

255,333

GBP

1,985

ForFarmers

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

104,022

EUR

(9,360)

Fortress REIT Ltd.

1-Day SABOR + 0.50%

Monthly

MSCS

11/27/24

7,466,311

ZAR

9,226

Forvia

1-Day EONIA + 0.30%

Monthly

MSCS

12/02/24

149,554

EUR

(1,491)

Foxtons Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

9/18/24

47,164

GBP

64,056

freenet AG

Euro STR + 0.35%

Monthly

JPHQ

8/08/24

150,453

EUR

7,476

Fuchs Petrolub SE

Euro STR + 0.35%

Monthly

JPHQ

4/25/25

238,035

EUR

28,140

Fugro NV

Euro STR + 0.35%

Monthly

JPHQ

5/27/25

372,437

EUR

195,744

Galliford Try Holdings PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

69,330

GBP

35,159

Games Workshop Group PLC

1-Day SONIA + 0.35%

Monthly

MSCO

1/16/25

301,837

GBP

7,210

b,cGazprom PJSC ADR

1-Day FEDEF

Monthly

MSCS

1/31/25

​173,903

​—

50			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

Genmab A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

7/17/24

4,002,182

DKK

$(96,575)

Gerresheimer AG

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

410,028

EUR

14,989

Gestamp Automocion SA

1-Day EONIA + 0.35%

Monthly

MSCS

7/17/24

530,855

EUR

(149,099)

Gimv

Euro STR + 0.35%

Monthly

JPHQ

4/14/25

89,958

EUR

3,006

Granges AB

1-Week STIBOR + 0.28%

Monthly

SEBA

9/02/24

2,918,913

SEK

73,460

Greencore Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

9/12/24

242,804

GBP

353,743

Grifols SA

1-Day EONIA + 0.35%

Monthly

MSCO

3/25/25

124,805

EUR

9,134

Groupe SEB

1-Day EONIA + 0.30%

Monthly

MSCS

8/12/24

218,538

EUR

36,988

Gurit

1-Day SARON + 0.35%

Monthly

JPHQ

11/06/24

84,421

CHF

(7,801)

H&M Hennes & Mauritz AB

1-Week STIBOR + 0.28%

Monthly

SEBA

8/15/24

2,688,404

SEK

33,547

H. Lundbeck A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

11/27/24

4,315,733

DKK

60,342

Hafnia Ltd.

1-Week NIBOR + 0.275%

Monthly

SEBA

4/15/25

2,812,541

NOK

34,054

Hal Trust

Euro STR + 0.35%

Monthly

JPHQ

4/16/25

207,115

EUR

(16,549)

Hammerson PLC

1-Day SABOR + 0.70%

Monthly

MSCS

11/27/24

348,169

GBP

36,076

HANZA AB

1-Week STIBOR + 0.28%

Monthly

SEBA

6/14/24

1,165,612

SEK

(14,137)

Harmony Gold Mining Co. Ltd.

1-Day SABOR + 0.70%

Monthly

MSCO

3/06/25

3,301,664

ZAR

46,022

HeidelbergCement AG

1-Month EURIBOR + 0.40%

Monthly

JPHQ

7/17/24

343,185

EUR

103,852

Heijmans NV

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

185,107

EUR

167,347

Hemnet Group AB

1-Week STIBOR + 0.28%

Monthly

SEBA

8/02/24

1,750,762

SEK

(918)

Hera

Euro STR + 0.35%

Monthly

JPHQ

1/10/25

332,136

EUR

38,037

Hikma Pharmaceuticals PLC

1-Day SONIA + 0.35%

Monthly

MSCO

1/08/25

323,089

GBP

2,237

Hilton Food Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

10/18/24

184,227

GBP

46,733

Hochtief AG

Euro STR + 0.35%

Monthly

JPHQ

3/18/25

399,191

EUR

17,392

Hoegh Autoliners AS

1-Week NIBOR + 0.275%

Monthly

SEBA

4/26/25

2,492,962

NOK

131,477

Hoist Finance AB

1-Week STIBOR + 0.28%

Monthly

SEBA

11/27/24

1,025,317

SEK

71,682

Holcim Ltd.

1-Day SARON + 0.35%

Monthly

JPHQ

5/09/25

377,138

CHF

113,390

HORNBACH Holding AG & Co. KGaA

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

377,688

EUR

31,024

Huhtamaki OYJ

Euro STR + 0.275%

Monthly

SEBA

1/30/25

429,622

EUR

3,755

Humble Group AB

1-Week STIBOR + 0.28%

Monthly

SEBA

11/27/24

1,205,794

SEK

(7,831)

Husqvarna AB

1-Week STIBOR + 0.275%

Monthly

SEBA

9/25/24

4,033,366

SEK

22,450

HUUUGE Inc.

1-Day FEDEF + 1.25%

Monthly

MSCS

7/01/24

96,865

(10,222)

hVIVO PLC

1-Day SONIA + 0.35%

Monthly

MSCS

5/27/25

55,600

GBP

36,349

Hyundai Motor Co.

1-Day FEDEF + 0.30%

Monthly

MSCS

2/05/25

307,652

941

Imperial Brands PLC

1-Day SONIA + 0.35%

Monthly

MSCO

5/22/25

86,337

GBP

275

Indra Sistemas SA

1-Day EONIA + 0.35%

Monthly

MSCS

7/17/24

469,402

EUR

267,874

Indus-Holding AG

Euro STR + 0.35%

Monthly

JPHQ

10/11/24

47,495

EUR

17,128

Industrivarden AB

1-Week STIBOR + 0.28%

Monthly

SEBA

8/15/24

4,808,880

SEK

102,824

Inficon

1-Day SARON + 0.35%

Monthly

JPHQ

3/25/25

57,837

CHF

5,685

Instone Real Estate Group SE

Euro STR + 0.35%

Monthly

JPHQ

12/12/24

75,072

EUR

21,414

Intermediate Capital Group

1-Day SONIA + 0.35%

Monthly

MSCO

1/06/25

180,213

GBP

95,915

International Consolidated Airlines Group SA

1-Day SONIA + 0.30%

Monthly

MSCS

5/27/25

364,149

GBP

46,152

Intesa Sanpaolo SpA

Euro STR + 0.35%

Monthly

JPHQ

4/22/25

309,652

EUR

83,045

Investec

1-Day SONIA + 0.35%

Monthly

MSCS

7/05/24

408,417

GBP

45,126

Ionos Group SE

Euro STR + 0.35%

Monthly

JPHQ

11/06/24

266,958

EUR

93,086

franklintempleton.com			Annual Report			51

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

IP Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

56,302

GBP

$2,889

Ipsen Pharma SAS

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

281,402

EUR

27,361

IQE PLC

1-Day SONIA + 0.35%

Monthly

MSCO

5/22/25

27,940

GBP

(1,437)

Italian Sea Group (The)

Euro STR + 0.35%

Monthly

JPHQ

6/17/24

242,924

EUR

53,169

Iveco

Euro STR + 0.35%

Monthly

JPHQ

11/28/24

250,757

EUR

53,321

IWG PLC

1-Day SONIA + 0.35%

Monthly

MSCS

4/03/25

396,712

GBP

37,383

J D Wetherspoon PLC

1-Day SONIA + 0.35%

Monthly

MSCS

5/12/25

437,815

GBP

32,803

JCDecaux SE

1-Day EONIA + 0.30%

Monthly

MSCS

11/07/24

262,857

EUR

70,605

JD Sports Fashion PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

225,491

GBP

23,138

Jet2 PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/18/24

345,441

GBP

44,946

Johnson Service Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

6/07/24

239,230

GBP

119,862

JOST Werke SE

Euro STR + 0.35%

Monthly

JPHQ

7/05/24

154,124

EUR

(5,181)

JSW

1-Day FEDEF + 1.25%

Monthly

MSCO

1/27/25

141,475

(40,537)

Just Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

11/27/24

452,415

GBP

121,371

Kap Industrial Holdings Ltd.

1-Day SABOR + 0.30%

Monthly

MSCS

7/17/24

3,773,341

ZAR

(50,722)

Kaufman ET Broad

1-Day EONIA + 0.30%

Monthly

MSCS

12/02/24

81,283

EUR

11,715

Kemira OYJ

1-Week Euro STR + 0.275%

Monthly

SEBA

7/17/24

404,079

EUR

145,266

Kenmare Resources PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

114,031

GBP

(24,423)

Kernel Holding SA

1-Day FEDEF + 0.30%

Monthly

MSCS

7/17/24

9,590

7,152

Kinepolis

Euro STR + 0.35%

Monthly

JPHQ

2/26/25

51,986

EUR

(4,959)

Kitron ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

7/19/24

2,668,638

NOK

4,022

Klepierre SA

1-Day EONIA + 0.30%

Monthly

MSCS

8/08/24

95,735

EUR

13,158

Knights Group Holdings PLC

1-Day SONIA + 0.35%

Monthly

MSCS

11/18/24

23,150

GBP

8,202

Koc Holding AS

1-Day FEDEF + 0.30%

Monthly

MSCS

7/17/24

208,270

139,080

Konecranes OYJ

Euro STR + 0.28%

Monthly

SEBA

11/22/24

419,578

EUR

222,162

Koninklijke BAM Groep NV

Euro STR + 0.35%

Monthly

JPHQ

8/14/24

90,568

EUR

812

Koninklijke KPN NV

Euro STR + 0.35%

Monthly

JPHQ

10/11/24

190,029

EUR

13,209

Koninklijke Philips  NV

Euro STR + 0.35%

Monthly

JPHQ

8/26/24

223,751

EUR

72,195

Kontron AG

Euro STR + 0.35%

Monthly

JPHQ

4/11/25

211,129

EUR

30,137

La Francaise Des Jeux SA

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

459,687

EUR

(40,520)

Lagercrantz Group AB

1-Week STIBOR + 0.275%

Monthly

SEBA

3/13/25

2,176,577

SEK

28,488

Lancashire Holdings Ltd.

1-Day SONIA + 0.35%

Monthly

MSCS

2/19/25

501,279

GBP

30,983

Lar Espana Real Estate SOCIMI SA

1-Day EONIA + 0.35%

Monthly

MSCS

7/17/24

106,958

EUR

37,871

Lassila & Tikanoja PLC

Euro STR + 0.275%

Monthly

SEBA

1/27/25

38,496

EUR

(4,230)

Learning Technologies Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/01/24

152,037

GBP

22,344

Link Mobility Group Holding ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

11/27/24

3,586,551

NOK

52,097

LiveChat Software SA

1-Day FEDEF + 0.30%

Monthly

MSCS

7/17/24

172,414

(34,680)

Logitech International

1-Day + 0.35%

Monthly

JPHQ

2/17/25

290,806

CHF

53,273

LondonMetric Property PLC

1-Day SONIA + 0.35%

Monthly

MSCO

4/01/25

342,996

GBP

13,101

Lonza Group AG

1-Day SARON + 0.35%

Monthly

JPHQ

3/20/25

230,547

CHF

(20,632)

Loomis AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/15/24

6,842,662

SEK

(39,779)

LPP

1-Day FEDEF + 1.25%

Monthly

MSCS

10/10/24

400,246

47,597

Lundbergs AB

1-Week STIBOR + 0.275%

Monthly

SEBA

9/19/24

840,069

SEK

1,682

Lundin Gold Inc.

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

1,585,411

SEK

15,219

Maire Tecnimont SpA

Euro STR + 0.35%

Monthly

JPHQ

8/14/24

331,715

EUR

283,748

Man Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/15/24

280,590

GBP

54,062

52			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

Map Aktif Adiperkasa PT

1-Day EONIA + 0.35%

Monthly

MSCS

2/26/25

98,150

EUR

$12,894

Marks & Spencer Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

413,367

GBP

183,463

Maurel & Prom

1-Day EONIA + 0.30%

Monthly

MSCS

5/16/25

18,975

EUR

5,594

Mavi Giyim  Sanayi Ve Ticaret AS

1-Day FEDEF + 0.30%

Monthly

MSCS

7/17/24

6,663

5,406

MediaForEurope

1-Day EONIA + 0.35%

Monthly

JPHQ

5/31/25

239,028

EUR

130,975

MediaForEurope

1-Day EONIA + 0.35%

Monthly

MSCO

5/31/25

103,324

EUR

36,559

Medios AG

Euro STR + 0.35%

Monthly

JPHQ

11/01/24

120,534

EUR

(9,389)

Meier Tobler  Group AG

1-Day SARON + 0.35%

Monthly

JPHQ

5/09/25

159,232

CHF

(30,087)

Melia Hotels International

1-Day EONIA + 0.35%

Monthly

MSCO

5/20/25

230,933

EUR

4,275

Mensch und Maschine Software SE

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

41,613

EUR

6,802

Mersen

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

361,705

EUR

26,760

Metropole TV

1-Day EONIA + 0.30%

Monthly

MSCS

12/02/24

136,735

EUR

14,078

Migros Ticaret

1-Day FEDEF + 0.30%

Monthly

MSCS

9/09/24

45,369

3,264

Mitchells & Butlers PLC

1-Day SONIA + 0.35%

Monthly

MSCS

11/27/24

248,395

GBP

119,742

Mitie Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

366,658

GBP

138,764

Modern Times Group MTG AB

1-Week STIBOR + 0.275%

Monthly

SEBA

5/08/25

5,402,470

SEK

117,078

Momentum Metropolitan Holdings Ltd.

1-Day SABOR + 0.70%

Monthly

MSCS

6/12/24

1,593,146

ZAR

3,341

Mondadori Group

Euro STR + 0.35%

Monthly

JPHQ

4/25/25

82,089

EUR

3,631

Moneysupermarket.com

1-Day SONIA + 0.35%

Monthly

MSCS

2/27/25

366,273

GBP

(55,611)

Montana

1-Day SARON + 0.35%

Monthly

JPHQ

11/27/24

109,032

CHF

11,423

Montea NV

Euro STR + 0.35%

Monthly

JPHQ

6/05/24

54,897

EUR

893

Morgan Sindall Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

369,890

GBP

139,555

Mowi ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

7/17/24

2,579,773

NOK

(1,666)

MPC Container Ships ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

7/17/24

1,686,588

NOK

42,639

Mr Price Group Ltd.

1-Day SABOR + 0.70%

Monthly

MSCO

3/14/25

8,359,286

ZAR

7,709

MTN Group Ltd.

1-Day SABOR + 0.32%

Monthly

MSCS

7/15/24

2,961,039

ZAR

(31,769)

Nabors Industries Ltd.

​3-Month SOFR + 0.51%

​Quarterly

GSCO

4/18/25

7,446

(465)

NCC AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

3,259,425

SEK

59,928

Netcare Ltd.

1-Day SABOR + 0.70%

Monthly

MSCS

10/02/24

12,069,897

ZAR

(124,198)

Newlat Food

Euro STR + 0.35%

Monthly

JPHQ

5/22/25

27,668

EUR

7,834

Nexans

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

340,376

EUR

152,620

Nilfisk Holding A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

7/12/24

920,858

DKK

20,191

Niox Group PLC

1-Day SONIA + 0.35%

Monthly

MSCO

1/06/25

25,424

GBP

5,136

NKT A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

11/27/24

1,900,996

DKK

136,649

NN Group NV

Euro STR + 0.35%

Monthly

JPHQ

7/15/24

470,766

EUR

149,505

NNIT A/S

1-Week CIBOR + 0.275%

Monthly

SEBA

6/02/25

26,002

DKK

4

Nokia Corp.

Euro STR + 0.28%

Monthly

SEBA

7/17/24

379,112

EUR

15,025

Norbit ASA

1-Week NIBOR + 0.275%

Monthly

SEBA

12/20/24

652,390

NOK

6,414

Nordea Bank ABP

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

1,879,134

SEK

11,956

Nordic Paper Holding AB

1-Week STIBOR + 0.28%

Monthly

SEBA

8/15/24

1,311,148

SEK

63,027

Norion Bank AB

1-Week STIBOR + 0.275%

Monthly

SEBA

3/07/25

882,207

SEK

(4,689)

Norwegian Air Shuttle ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

7/19/24

3,026,291

NOK

64,241

Novartis  AG

1-Day SARON + 0.35%

Monthly

JPHQ

4/22/25

481,811

CHF

21,602

Novo Nordisk AS

1-Week CIBOR + 0.275%

Monthly

SEBA

7/17/24

990,988

DKK

73,859

​Odfjell SE

1-Week NIBOR + 0.28%

Monthly

SEBA

7/18/24

1,429,031

NOK

31,682

franklintempleton.com			Annual Report			53

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

��

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

​Odfjell SE

1-Week NIBOR + 0.275%

Monthly

SEBA

1/08/25

226,517

NOK

$1,224

Odfjell Technology Ltd.

1-Week NIBOR + 0.275%

Monthly

SEBA

4/15/25

78,369

NOK

(75)

Odfjell Technology Ltd.

1-Week NIBOR + 0.275%

Monthly

SEBA

4/15/25

604,252

NOK

4,826

Okea ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

7/17/24

3,938,422

NOK

(77,890)

Okeanis Eco Tankers Corp.

1-Week NIBOR + 0.28%

Monthly

SEBA

7/17/24

2,000,993

NOK

19,440

Old Mutual Ltd.

1-Day SABOR + 0.70%

Monthly

MSCO

4/30/25

7,298,446

ZAR

(14,525)

Oma Saastopankki OYJ

Euro STR + 0.275%

Monthly

SEBA

12/16/24

45,319

EUR

(12,658)

Omnia Holdings Ltd.

1-Day SABOR + 0.31%

Monthly

MSCS

7/17/24

2,601,764

ZAR

(10,612)

On The Beach Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

246,760

GBP

(1,881)

Ontex Group NV

Euro STR + 0.35%

Monthly

JPHQ

11/27/24

163,734

EUR

38,348

Orange Polska SA

1-Day FEDEF + 0.30%

Monthly

MSCS

7/17/24

109,363

136

Oriola Corp.

Euro STR + 0.28%

Monthly

SEBA

7/17/24

77,787

EUR

(21,986)

ORIOR AG

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

160,872

CHF

(31,198)

ORSERO

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

105,367

EUR

(22,175)

OSB Group

1-Day SONIA + 0.35%

Monthly

MSCS

9/12/24

237,399

GBP

42,496

Osram Licht AG

1-Day SARON + 0.35%

Monthly

JPHQ

11/27/24

395,784

CHF

(62,346)

OVS SpA

Euro STR + 0.35%

Monthly

JPHQ

7/26/24

347,024

EUR

97,021

Pagegroup PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

71,933

GBP

7,321

Pandora A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

7/15/24

2,423,567

DKK

87,771

Pandox AB

1-Week STIBOR + 0.28%

Monthly

SEBA

11/01/24

3,103,352

SEK

86,827

Panoro Energy ASA

1-Week NIBOR + 0.275%

Monthly

SEBA

10/30/24

2,725,405

NOK

75,183

Pantheon Infrastructure

1-Day SONIA + 0.35%

Monthly

MSCO

4/15/25

19,343

GBP

378

Paypoint

1-Day SONIA + 0.35%

Monthly

MSCS

9/23/24

195,590

GBP

8,510

Per Aarsleff Holding A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

7/17/24

1,171,715

DKK

32,830

Petershill Partners PLC

1-Day SONIA + 0.35%

Monthly

MSCO

1/23/25

159,076

GBP

48,234

Pexip Holding

1-Week NIBOR + 0.28%

Monthly

SEBA

11/27/24

1,057,623

NOK

17,423

PGE Polska Grupa Energetyczna SA

1-Day FEDEF + 0.30%

Monthly

MSCS

7/15/24

362,626

(28,085)

Plastic Omnium

1-Day EONIA + 0.30%

Monthly

MSCO

3/14/25

294,515

EUR

(20,612)

Playtech PLC

1-Day SONIA + 0.35%

Monthly

MSCS

5/12/25

333,044

GBP

(17,641)

PORR AG

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

171,762

EUR

19,275

Poste Italiane SpA

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

408,271

EUR

91,901

PPC Ltd.

1-Day SABOR + 0.32%

Monthly

MSCS

7/17/24

829,500

ZAR

5,977

Prevas AB

1-Week STIBOR + 0.275%

Monthly

SEBA

10/03/24

418,976

SEK

12,899

Prosegur

1-Day EONIA + 0.35%

Monthly

MSCS

9/26/24

144,191

EUR

5,211

Publicis Groupe SA

1-Day EONIA + 0.30%

Monthly

MSCS

8/30/24

170,206

EUR

56,716

Puuilo PLC

1-Week Euro STR + 0.275%

Monthly

SEBA

4/22/25

87,784

EUR

17,722

PVA TePla AG

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

444,087

EUR

(37,367)

PZU

1-Day FEDEF + 1.25%

Monthly

MSCO

4/03/25

91,919

1,013

Quadient

1-Day EONIA + 0.30%

Monthly

MSCS

11/27/24

132,167

EUR

34,801

Rai Way SpA

Euro STR + 0.35%

Monthly

JPHQ

8/12/24

173,321

EUR

4,011

Raiffeisen Bank International AG

Euro STR + 0.35%

Monthly

JPHQ

11/28/24

294,695

EUR

13,632

Rainbow

1-Day FEDEF + 1.25%

Monthly

MSCS

11/28/24

72,203

62,520

Randstad NV

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

254,348

EUR

(8,286)

Raysearch Laboratories AB

1-Week STIBOR + 0.275%

Monthly

SEBA

12/04/24

1,062,159

SEK

59,303

Regional Reit Ltd

1-Day SONIA + 0.35%

Monthly

MSCO

12/05/24

101,230

GBP

(4,276)

54			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

Repsol SA

1-Day EONIA + 0.35%

Monthly

MSCS

7/12/24

214,226

EUR

$9,744

Retail Estates NV

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

278,326

EUR

38,020

Reunert Ltd.

1-Day SABOR + 0.70%

Monthly

MSCS

8/15/24

3,392,607

ZAR

23,225

Roche

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

508,225

CHF

(74,108)

Rockwool A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

7/17/24

3,421,540

DKK

260,319

Rolls-Royce Holdings PLC

1-Day SONIA + 0.35%

Monthly

MSCO

2/17/25

249,650

GBP

99,204

Rubis

1-Day EONIA + 0.30%

Monthly

MSCS

8/12/24

295,925

EUR

143,973

Sainsbury J PLC

1-Day SONIA + 0.35%

Monthly

MSCO

12/04/24

244,561

GBP

(4,779)

Saint-Gobain SA

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

192,414

EUR

68,115

SalMar ASA

1-Week NIBOR + 0.275%

Monthly

SEBA

4/15/25

2,471,819

NOK

(10,176)

Salzgitter AG

Euro STR + 0.35%

Monthly

JPHQ

12/13/24

302,582

EUR

(32,412)

Sanlorenzo

Euro STR + 0.35%

Monthly

JPHQ

8/26/24

316,076

EUR

18,440

Sany Heavy Industrial Co. Ltd

1-Day FEDEF + 0.30%

Monthly

MSCS

1/02/25

432,608

(18,415)

Sappi Ltd.

1-Day SABOR + 0.70%

Monthly

MSCS

11/27/24

8,849,937

ZAR

117,124

Sasol Ltd.

1-Day SABOR + 0.33%

Monthly

MSCS

7/17/24

8,875,843

ZAR

(180,222)

SATS ASA

1-Week NIBOR + 0.275%

Monthly

SEBA

2/17/25

610,975

NOK

(476)

Scandi Standard AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

1,967,550

SEK

81,857

Scanfil PLC

Euro STR + 0.275%

Monthly

SEBA

10/17/24

52,855

EUR

997

Schindler

1-Day SARON + 0.35%

Monthly

JPHQ

11/29/24

452,872

CHF

80,413

Schouw & Co.

1-Week NIBOR + 0.275%

Monthly

SEBA

5/22/25

734,828

DKK

(1,035)

SCOR SE

1-Day EONIA + 0.30%

Monthly

MSCS

8/12/24

509,159

EUR

(35,745)

Securitas AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

3,678,530

SEK

22,631

Serco Group

1-Day SONIA + 0.35%

Monthly

MSCS

9/30/24

382,451

GBP

84,272

Severfield PLC

1-Day SONIA + 0.35%

Monthly

MSCS

9/27/24

45,654

GBP

5,636

SHELL PLC

1-Day SONIA + 0.40%

Monthly

MSCS

5/03/25

1,339,192

GBP

(22,424)

Siegfried

1-Day SARON + 0.35%

Monthly

JPHQ

11/11/24

459,019

CHF

94,668

Siemens Energy AG

Euro STR + 0.35%

Monthly

MSCS

3/03/25

3,295,893

EUR

(131,217)

Signify NV

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

456,189

EUR

(22,180)

Sinch

1-Week STIBOR + 0.28%

Monthly

SEBA

11/27/24

2,734,181

SEK

(25,644)

Sirius Real Estate Ltd.

1-Day SONIA + 0.35%

Monthly

MSCS

7/22/24

105,237

GBP

16,935

SKF AB

1-Week STIBOR + 0.275%

Monthly

SEBA

3/25/25

5,216,990

SEK

79,815

SMA Solar Technology AG

Euro STR + 0.35%

Monthly

JPHQ

9/12/24

158,981

EUR

(3,586)

Smurfit Kappa Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

99,230

GBP

41,214

Societe Generale SA

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

368,628

EUR

48,765

Sodexo

1-Day EONIA + 0.30%

Monthly

MSCS

5/16/25

211,935

EUR

20,910

Sogefi

Euro STR + 0.35%

Monthly

JPHQ

11/14/24

98,689

EUR

60,744

Sogefi

Euro STR + 0.35%

Monthly

JPHQ

11/27/24

5,483

EUR

4,864

Solar A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

7/15/24

668,178

DKK

(25,207)

Solstad Offshore

1-Week NIBOR + 0.28%

Monthly

SEBA

11/27/24

2,401,715

NOK

(12,233)

Solvay

Euro STR + 0.35%

Monthly

JPHQ

10/10/24

396,179

EUR

132,843

Sopra Steria Group SA

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

314,958

EUR

46,895

Spar Nord Bank A/S

1-Week CIBOR + 0.275%

Monthly

SEBA

4/22/25

2,004,180

DKK

43,365

Sparekassen Sjaelland

1-Week CIBOR + 0.275%

Monthly

SEBA

3/14/25

488,791

DKK

(71)

Speedy Hire PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

106,044

GBP

(38,486)

SSAB AB

1-Week STIBOR + 0.28%

Monthly

SEBA

7/17/24

3,773,217

SEK

(52,715)

Stadler Rail AG

Euro STR + 0.35%

Monthly

JPHQ

7/31/24

287,895

CHF

(35,600)

franklintempleton.com			Annual Report			55

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

Standard Chartered PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

246,695

GBP

$59,884

STEF

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

28,223

EUR

9,463

Stellantis NV

Euro STR + 0.35%

Monthly

JPHQ

7/12/24

390,924

EUR

67,500

SThree PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/12/24

292,780

GBP

56,324

Stolt-Nielsen Ltd.

1-Week NIBOR + 0.28%

Monthly

SEBA

7/17/24

2,208,988

NOK

109,274

Storytel AB

1-Week STIBOR + 0.275%

Monthly

SEBA

5/08/25

849,862

SEK

(908)

STRABAG SE

Euro STR + 0.35%

Monthly

JPHQ

7/12/24

231,366

EUR

7,028

Sulzer Ltd.

1-Day SARON + 0.35%

Monthly

JPHQ

11/11/24

517,590

CHF

228,266

Sun International Hotels Ltd.

1-Day SABOR + 0.70%

Monthly

MSCS

5/20/25

2,257,628

ZAR

(6,667)

Swedencare AB

1-Week STIBOR + 0.275%

Monthly

SEBA

5/20/25

372,532

SEK

1,644

Swiss Re AG

1-Day SARON + 0.35%

Monthly

JPHQ

7/17/24

346,020

CHF

87,821

Sydbank A/S

1-Week CIBOR + 0.28%

Monthly

SEBA

7/17/24

1,936,596

DKK

52,826

Synektik

1-Day FEDEF + 1.25%

Monthly

MSCS

9/05/24

121,737

87,678

Synsam AB

1-Week STIBOR + 0.275%

Monthly

SEBA

4/25/25

776,259

SEK

9,316

Synthomer PLC

1-Day SONIA + 0.35%

Monthly

MSCO

3/28/25

209,732

GBP

22,980

Tag Immobilien AG

Euro STR + 0.35%

Monthly

JPHQ

12/09/24

254,275

EUR

51,193

Talanx AG

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

274,248

EUR

26,119

Tauron Polska Energia SA

1-Day FEDEF + 0.30%

Monthly

MSCS

7/17/24

243,603

21,494

TBC Bank Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

241,000

GBP

1,132

Team Internet Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

293,915

GBP

197,874

TeamViewer AG

Euro STR + 0.35%

Monthly

JPHQ

8/01/24

666,701

EUR

(120,534)

Technogym SpA

Euro STR + 0.35%

Monthly

JPHQ

8/12/24

190,005

EUR

37,343

Tecnicas Reunidas SA

1-Day EONIA + 0.35%

Monthly

MSCO

2/28/25

144,335

EUR

98,818

Teknosa Ic Ve Dis Ticaret

1-Day FEDEF + 1.25%

Monthly

MSCO

5/15/25

38,224

(5,447)

Telkom SA SOC Ltd.

1-Day SABOR + 0.70%

Monthly

MSCS

7/17/24

6,392,951

ZAR

(16,488)

Ten Square Games

1-Day FEDEF + 1.25%

Monthly

MSCS

1/06/25

85,138

10,918

Terveystalo PLC

Euro STR + 0.28%

Monthly

SEBA

7/17/24

130,277

EUR

14,917

TF1 Group

1-Day EONIA + 0.30%

Monthly

MSCS

7/12/24

509,861

EUR

103,962

Tharisa PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

46,677

GBP

(12,799)

THG PLC

1-Day SONIA + 0.35%

Monthly

MSCS

11/27/24

201,014

GBP

20,125

Thungela Resources Ltd.

1-Day SABOR + 0.70%

Monthly

MSCS

8/23/24

4,545,108

ZAR

(97,143)

ThyssenKrupp AG

Euro STR + 0.35%

Monthly

JPHQ

11/27/24

416,911

EUR

(140,836)

TI Fluid Systems PLC

1-Day SONIA + 0.35%

Monthly

MSCO

2/12/25

251,509

GBP

(34,862)

Tinc Comm VA

Euro STR + 0.35%

Monthly

JPHQ

4/14/25

49,068

EUR

(1,116)

Titan Cement

Euro STR + 0.35%

Monthly

JPHQ

9/05/24

91,920

EUR

74,285

Torpol SA

1-Day FEDEF + 1.25%

Monthly

MSCO

1/30/25

29,380

3,882

Torunlar GYO

1-Day FEDEF + 1.25%

Monthly

MSCS

7/12/24

232,809

122,913

Traton SE INH O.N.

Euro STR + 0.35%

Monthly

JPHQ

9/12/24

67,221

EUR

46,158

Traton SE INH O.N.

1-Week STIBOR + 0.275%

Monthly

SEBA

3/13/25

147,066

SEK

556

Traton SE INH O.N.

1-Week STIBOR + 0.275%

Monthly

SEBA

3/14/25

1,848,232

SEK

(5,828)

Traton SE INH O.N.

1-Week STIBOR + 0.275%

Monthly

SEBA

3/14/25

302,766

SEK

(675)

Trigano

1-Day EONIA + 0.30%

Monthly

MSCS

9/23/24

196,063

EUR

(9,676)

Triple Point Social Housing

1-Day SONIA + 0.35%

Monthly

MSCO

1/06/25

17,625

GBP

(573)

Tristel PLC

1-Day SONIA + 0.35%

Monthly

MSCO

1/27/25

34,408

GBP

(4,071)

Tubacex SA

1-Day EONIA + 0.35%

Monthly

MSCS

8/26/24

151,973

EUR

5,072

56			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

TUI AG

Euro STR + 0.35%

Monthly

JPHQ

4/30/25

452,311

EUR

$(31,665)

u-blox AG

1-Day SARON + 0.35%

Monthly

JPHQ

7/17/24

491,626

CHF

(20,298)

UBS Group AG

1-Day SARON + 0.35%

Monthly

JPHQ

7/17/24

83,171

CHF

16,244

UniCredit SpA

Euro STR + 0.35%

Monthly

JPHQ

9/25/24

241,985

EUR

121,803

Unipol Gruppo SpA

Euro STR + 0.35%

Monthly

JPHQ

7/15/24

157,407

EUR

136,928

UPM-Kymmene Corp.

Euro STR + 0.275%

Monthly

SEBA

12/18/24

174,171

EUR

11,188

Vaisala Corp.

Euro STR + 0.28%

Monthly

SEBA

7/17/24

47,848

EUR

3,950

Valeo

1-Day EONIA + 0.30%

Monthly

MSCS

10/09/24

380,769

EUR

(40,441)

Valiant

Euro STR + 0.35%

Monthly

JPHQ

7/12/24

20,480

CHF

19

Var Energi ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

10/23/24

3,312,869

NOK

79,368

VBG Group AB

1-Week STIBOR + 0.275%

Monthly

SEBA

1/16/25

1,496,372

SEK

105,421

Veidekke

1-Week NIBOR + 0.28%

Monthly

SEBA

8/26/24

2,140,448

NOK

9,959

Veolia Environnement SA

1-Day EONIA + 0.30%

Monthly

MSCS

8/26/24

260,818

EUR

21,520

Veolia Environnement SA

1-Day EONIA + 0.40%

Monthly

MSCS

6/03/25

4,101,980

EUR

14,084

Verallia

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

167,882

EUR

17,009

Vertu Motors PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

61,663

GBP

11,532

Vesuvius PLC

1-Day SONIA + 0.35%

Monthly

MSCS

4/26/25

347,519

GBP

61,707

Vetropack

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

80,841

CHF

(12,931)

VGP

Euro STR + 0.35%

Monthly

JPHQ

3/28/25

164,805

EUR

7,423

Vicat  SA

1-Day EONIA + 0.30%

Monthly

MSCS

8/30/24

215,676

EUR

26,735

Vienna Insurance Group AG

Euro STR + 0.35%

Monthly

JPHQ

12/18/24

220,907

EUR

11,847

Virbac

1-Day EONIA + 0.30%

Monthly

MSCO

5/20/25

126,129

EUR

654

Vitrolife AB

1-Week STIBOR + 0.275%

Monthly

SEBA

3/10/25

2,455,295

SEK

23,178

Vodafone Group PLC

1-Day SONIA + 0.35%

Monthly

MSCO

1/20/25

128,215

GBP

17,404

Voestalpine AG

Euro STR + 0.35%

Monthly

JPHQ

12/18/24

150,556

EUR

(4,166)

Volvo Car AB

1-Week STIBOR + 0.275%

Monthly

SEBA

3/07/25

5,628,330

SEK

(35,784)

Wallenius Wilhelmsen ASA

1-Week NIBOR + 0.28%

Monthly

SEBA

7/17/24

2,708,101

NOK

30,002

Warehouses De Pauw SA

Euro STR + 0.35%

Monthly

JPHQ

5/16/25

387,705

EUR

21,932

Wartsila Corp.

​Euro STR + 0.275%

Monthly

SEBA

10/17/24

308,655

EUR

185,080

Watkin Jones PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

341,546

GBP

(260,938)

WBHO Ltd.

1-Day SABOR + 0.70%

Monthly

MSCO

12/04/24

2,038,461

ZAR

15,932

Webuild SpA

Euro STR

Monthly

JPHQ

7/17/24

412,005

EUR

75,586

Wereldhave NV

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

201,430

EUR

(6,923)

Wickes Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

7/17/24

316,986

GBP

(2,438)

Wolters Kluwer NV

Euro STR + 0.35%

Monthly

JPHQ

4/17/25

193,789

EUR

4,094

Workspace Group PLC

1-Day SONIA + 0.35%

Monthly

MSCS

10/28/24

305,255

GBP

23,798

X Fab Silicon Foundries  EV

1-Day EONIA + 0.30%

Monthly

MSCS

7/17/24

319,556

EUR

(110,597)

YU Group PLC

1-Day SONIA + 0.35%

Monthly

MSCO

2/17/25

68,263

GBP

35,398

Zalando SE

Euro STR

Monthly

JPHQ

3/03/25

481,031

EUR

69,434

Zehnder

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

356,441

CHF

6,173

Zumtobel Group AG

Euro STR + 0.35%

Monthly

JPHQ

7/17/24

49,427

EUR

(3,991)

​14,147,982

franklintempleton.com			Annual Report			57

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Interest Rate Contracts - Longa

Cross Asset Trend

Fixed (0.50)%

Monthly

DBAB

6/28/24

4,636,088

$   1,404

Cross Asset Trend

Fixed (0.50)%

Monthly

DBAB

6/28/24

12,646,513

19,655

Cross Asset Trend

Fixed (0.50)%

Monthly

DBAB

6/28/24

788,532

(145)

Cross Asset Trend

Fixed (0.50)%

Monthly

DBAB

6/28/24

6,262,342

​6,943

Nigeria Government Bond

1-Day FEDEF

Quarterly

CITI

2/21/34

134,492

(17,887)

Nigeria Treasury Bills

1-Day FEDEF

Quarterly

CITI

4/02/25

544,871

(59,549)

​(49,579)

Equity Contracts - Shortd

888 Holdings PLC

1-Day SONIA - 0.30%

Monthly

MSCS

10/21/24

151,491

GBP

(20,159)

AB Dynamics PLC

1-Day SONIA - 1.25%

Monthly

MSCS

7/18/24

141,564

GBP

(87,582)

abrdn European Logistics Income PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

147,038

GBP

37,029

ABSA Group Ltd

1-Day SABOR - 0.50%

Monthly

MSCO

12/13/24

2,017,736

ZAR

2,750

Accesso Technology Group

1-Day SONIA - 2.75%

Monthly

MSCS

9/27/24

54,347

GBP

(20,042)

Acciones Fomento De Construcciones

1-Day EONIA - 1.75%

Monthly

MSCS

1/13/25

58,051

EUR

(13,188)

ACEA

Euro STR - 0.30%

Monthly

JPHQ

10/14/24

111,911

EUR

(35,536)

Ackermans & van Haaren

Euro STR - 0.30%

Monthly

JPHQ

3/18/25

535,875

EUR

(82,369)

Addnode Group AB

1-Week STIBOR - 0.275%

Monthly

SEBA

7/17/24

2,624,956

SEK

(113,750)

adesso SE

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

91,175

EUR

2,759

adesso SE

Euro STR - 0.30%

Monthly

JPHQ

1/08/25

18,854

EUR

1,132

Admiral Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

243,465

GBP

(57,311)

Afrimat Ltd.

1-Day SABOR - 0.50%

Monthly

MSCO

5/20/25

1,443,754

ZAR

(16,649)

Agilyx

1-Week NIBOR - 4.25%

Monthly

SEBA

8/07/24

311,758

NOK

2,231

Air France-KLM

1-Day EONIA - 1.875%

Monthly

MSCO

3/20/25

125,518

EUR

(8,324)

Air Liquide

1-Day EONIA - 0.30%

Monthly

MSCS

7/17/24

127,049

EUR

(5,867)

Aixtron SE

Euro STR - 0.30%

Monthly

JPHQ

3/20/25

141,111

EUR

27,533

Aker BP ASA

1-Week NIBOR - 0.28%

Monthly

SEBA

7/17/24

1,682,719

NOK

(1,637)

Aker Carbon Capture ASA

1-Week NIBOR - 0.28%

Monthly

SEBA

7/14/24

2,389,232

NOK

79,907

Aker Horizons

1-Week NIBOR - 4.25%

Monthly

SEBA

11/22/24

599,625

NOK

22,512

ALD

1-Day EONIA - 0.30%

Monthly

MSCS

5/15/25

336,419

EUR

21,825

Alfen NV

Euro STR - 0.80%

Monthly

JPHQ

3/07/25

394,854

EUR

112,066

Allegro

1-Day FEDEF - 2.13%

Monthly

MSCS

7/12/24

212,101

(57,931)

Allfunds Group PLC

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

134,029

EUR

20,720

Allreal Holding AG

1-Day SARON - 0.35%

Monthly

JPHQ

7/17/24

331,481

CHF

407

Alm. Brand A/S

1-Week CIBOR - 0.75%

Monthly

SEBA

7/26/24

3,344,168

DKK

(68,003)

Almirall SA

1-Day EONIA - 0.35%

Monthly

MSCO

10/11/24

​25,970

EUR

(8,735)

Almirall SA

1-Day EONIA - 0.35%

Monthly

MSCS

10/11/24

222,242

EUR

(33,966)

Alpha Financial Markets

1-Day SONIA - 0.30%

Monthly

MSCO

2/17/25

159,937

GBP

(38,724)

Alpha FX Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

118,746

GBP

(52,155)

Alphawave IP Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

3/24/25

202,607

GBP

(30,924)

Alstom SA

1-Day EONIA - 0.30%

Monthly

MSCS

7/13/24

119,301

EUR

(60,113)

AMG Advanced Metallurgical Group NV

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

137,236

EUR

6,329

AmRest

1-Day FEDEF -1.50%

Monthly

MSCS

7/17/24

26,790

209

Anglo American Platinum Ltd.

1-Day SABOR - 0.50%

Monthly

MSCS

8/15/24

2,298,625

ZAR

18,531

Anheuser-Busch InBev SA/NV

Euro STR - 0.30%

Monthly

JPHQ

7/13/24

393,807

EUR

(22,198)

58			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortd (continued)

Antares Vision

Euro STR - 2.65%

Monthly

JPHQ

8/07/24

53,363

EUR

$(41,072)

Antofagasta PLC

1-Day SONIA - 0.30%

Monthly

MSCS

2/17/25

146,945

GBP

(82,492)

Arbonia AG

1-Day SARON - 0.35%

Monthly

JPHQ

11/08/24

216,693

CHF

(70,309)

Arcelik

1-Day FEDEF - 5.00%

Monthly

MSCS

7/17/24

133,760

(66,254)

argenx SE

Euro STR - 0.30%

Monthly

JPHQ

7/01/24

82,739

EUR

1,065

Ariston Holding

Euro STR - 0.30%

Monthly

JPHQ

9/11/24

263,765

EUR

54,635

Ascential PLC

1-Day SONIA - 0.875%

Monthly

MSCO

7/17/24

310,631

GBP

68,530

Ascopiave SpA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

90,383

EUR

5,084

Aselsan AS

1-Day FEDEF - 7.50%

Monthly

MSCS

7/17/24

18,998

(35,720)

Ashtead Group PLC

1-Day SONIA - 0.30%

Monthly

MSCO

12/16/24

293,636

GBP

(24,858)

Aspen Pharmacare Holdings Ltd.

1-Day SABOR - 0.50%

Monthly

MSCS

7/17/24

5,095,034

ZAR

(50,030)

Assa Abloy AB

1-Week STIBOR - 0.28%

Monthly

SEBA

11/27/24

2,623,635

SEK

(56,459)

Aston Martin Lagonda Global Holdings PLC

1-Day SONIA - 8.75%

Monthly

MSCS

7/17/24

287,765

GBP

70,295

Astral Foods Ltd.

1-Day SABOR - 0.50%

Monthly

MSCS

8/12/24

5,237,948

ZAR

31,813

Atrium Ljungberg AB

1-Week STIBOR - 0.45%

Monthly

SEBA

4/04/25

2,298,534

SEK

(969)

Auction Technology Group

1-Day SONIA - 0.30%

Monthly

MSCS

11/01/24

230,345

GBP

23,375

Aurubis AG

Euro STR - 0.30%

Monthly

JPHQ

3/20/25

71,869

EUR

(13,475)

AUTO1 Group SE

Euro STR - 0.75%

Monthly

JPHQ

7/14/24

239,297

EUR

(93,432)

AutoStore Holdings Ltd.

1-Week NIBOR - 0.75%

Monthly

SEBA

4/04/25

1,770,731

NOK

34,285

Avanza Bank Holding AB

1-Week STIBOR - 0.75%

Monthly

SEBA

7/17/24

3,579,045

SEK

(75,359)

Avon Protection PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

105,410

GBP

(69,432)

Azelis Holding SA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

213,771

EUR

(2,200)

Bachem AG

Euro STR - 0.35%

Monthly

JPHQ

7/17/24

243,832

CHF

(47,726)

Baloise Holdings SA

1-Day SARON - 0.35%

Monthly

JPHQ

12/09/24

344,491

CHF

(49,987)

Banco BPM SpA

Euro STR - 0.30%

Monthly

JPHQ

3/12/25

33,678

EUR

(5,919)

Bank Handlowy

1-Day FEDEF - 0.50%

Monthly

MSCO

4/03/25

39,500

596

Bank of America MLEIAPRE Index

1-Day EONIA - 0.30%

Monthly

BOFA

3/21/25

165,771

EUR

(13,598)

Bankinter SA

1-Day EONIA - 0.35%

Monthly

MSCO

3/06/25

237,401

EUR

(74,106)

Banque Cantonale Vaudoise

Euro STR - 0.35%

Monthly

JPHQ

7/12/24

526,814

CHF

4,810

Barco

Euro STR - 0.30%

Monthly

JPHQ

4/14/25

61,361

EUR

(496)

Barloworld Ltd.

1-Day SABOR - 0.50%

Monthly

MSCS

10/03/25

1,804,867

ZAR

(3,839)

Barry Callebaut

1-Day SARON - 0.35%

Monthly

JPHQ

11/13/24

299,130

CHF

(43,208)

Basler AG

Euro STR - 1.20%

Monthly

JPHQ

7/17/24

90,646

EUR

(30,242)

Bayer AG

Euro STR - 0.30%

Monthly

JPHQ

8/28/24

170,669

EUR

(1,622)

BayWa AG

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

239,365

EUR

102,531

Befesa SA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

426,485

EUR

23,533

Beijer Ref AB

1-Week STIBOR - 0.28%

Monthly

SEBA

7/17/24

3,788,906

SEK

(143,397)

Belimo Holding AG

Euro STR - 0.35%

Monthly

JPHQ

7/17/24

341,462

CHF

2,092

Bellevue Group AG

1-Day SARON - 1.10%

Monthly

JPHQ

12/12/24

78,866

CHF

15,098

Beneteau

1-Day EONIA - 0.30%

Monthly

MSCO

5/06/25

34,360

EUR

(15)

BEWi ASA

1-Week NIBOR - 1.00%

Monthly

SEBA

4/15/25

299,937

NOK

2,268

BFF Bank SpA

Euro STR - 0.30%

Monthly

JPHQ

10/16/24

222,813

EUR

55,934

BHP Group Ltd

1-Day SONIA - 1.52%

Monthly

MSCO

12/02/24

148,472

GBP

1,033

Bioarctic AB

1-Week STIBOR - 0.275%

Monthly

SEBA

7/17/25

1,392,465

SEK

(17,974)

Biomerieux

1-Day EONIA - 0.30%

Monthly

MSCS

9/16/24

111,596

EUR

(1,439)

franklintempleton.com			Annual Report			59

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortd (continued)

BMW Group

Euro STR - 0.30%

Monthly

JPHQ

5/15/25

159,840

EUR

$10,353

Boliden AB

1-Week STIBOR - 0.28%

Monthly

SEBA

8/07/24

4,172,249

SEK

(99,397)

Bollore SE

1-Day EONIA - 0.30%

Monthly

MSCS

7/17/24

486,501

EUR

(67,767)

BoneSupport AB

1-Week STIBOR - 0.275%

Monthly

SEBA

3/27/25

1,040,064

SEK

(12,485)

Borr Drilling Limited

1-Week NIBOR - 0.75%

Monthly

SEBA

9/09/24

2,731,339

NOK

(6,996)

Borussia Dortmund

Euro STR - 0.95%

Monthly

JPHQ

7/17/24

135,298

EUR

(14,156)

Bossard AG

1-Day SARON - 0.35%

Monthly

JPHQ

7/17/24

117,671

CHF

(13,044)

British American Tobacco

1-Day SONIA - 0.30%

Monthly

MSCS

9/27/24

124,739

GBP

4,705

Budimex

1-Day FEDEF - 0.50%

Monthly

MSCO

5/07/25

74,959

(3,596)

BW Energy Ltd.

1-Week NIBOR - 0.45%

Monthly

SEBA

7/17/24

1,626,164

NOK

(36,546)

BW Offshore Ltd.

1-Week NIBOR - 0.28%

Monthly

SEBA

7/19/24

674,794

NOK

(15,540)

CA Immobilien Anlagen AG

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

581,490

EUR

(17,255)

Cadeler AS

1-Week NIBOR - 6.50%

Monthly

SEBA

7/17/24

2,992,011

NOK

(143,803)

Campari

Euro STR - 0.30%

Monthly

JPHQ

7/31/24

330,066

EUR

58,520

Cancom SE

1-Month EURIBOR - 0.25%

Monthly

JPHQ

7/17/24

168,537

EUR

(41,522)

Capgemini

1-Day EONIA - 0.30%

Monthly

MSCS

9/23/24

202,835

EUR

24,029

Capita PLC

1-Day SONIA - 0.30%

Monthly

MSCO

5/06/25

19,790

GBP

(1,010)

Capitec Bank Holdings Ltd.

1-Day SABOR - 0.50%

Monthly

MSCS

7/14/24

7,282,618

ZAR

(78,102)

Capricorn Energy PLC

1-Day SONIA - 0.30%

Monthly

MSCO

12/23/24

63,564

GBP

(13,082)

Carel Industries

Euro STR - 0.30%

Monthly

JPHQ

9/23/24

354,708

EUR

62,287

Carl Zeiss Meditec AG

Euro STR - 0.30%

Monthly

JPHQ

8/21/24

144,397

EUR

5,079

Catena AB

1-Day EONIA + 0.30%

Monthly

SEBA

5/08/25

1,359,106

SEK

(6,152)

CD Projekt SA

1-Day FEDEF - 1.25%

Monthly

MSCS

7/17/24

258,162

(40,068)

Cellnex Telecom SA

1-Day EONIA - 0.35%

Monthly

MSCS

7/14/24

614,062

EUR

18,657

Celon Pharma SA

1-Day FEDEF - 12.75%

Monthly

MSCS

10/28/24

11,213

(1,260)

Ceres Power Holdings PLC

1-Day SONIA - 1.38%

Monthly

MSCS

7/17/24

28,271

GBP

(8,533)

Chesnara PLC

1-Day SONIA - 0.30%

Monthly

MSCS

12/26/24

72,100

GBP

6,455

Cint Group AB

1-Week STIBOR - 0.45%

Monthly

SEBA

7/17/24

1,262,615

SEK

(38,994)

CIR SpA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

52,768

EUR

(2,257)

Citycon OYJ

Euro STR - 0.275%

Monthly

SEBA

5/08/25

38,655

EUR

(2,564)

Cloudberry Clean Energy ASA

���

1-Week NIBOR - 1.00%

Monthly

SEBA

7/17/24

294,039

NOK

(3,207)

CMC Markets PLC

1-Day SONIA - 0.30%

Monthly

MSCS

8/19/24

132,835

GBP

(270,061)

CNH Industrial

Euro STR - 0.30%

Monthly

JPHQ

3/24/25

549,107

EUR

95,549

Coats Group PLC

SONIA - 0.30%

Monthly

MSCS

6/03/25

75,169

GBP

(25,456)

Cognor Holding SA

1-Day FEDEF - 0.75%

Monthly

MSCS

7/17/24

57,628

(13,799)

Coloplast A/S

1-Week CIBOR - 0.28%

Monthly

SEBA

7/17/24

2,789,426

DKK

(14,099)

Comet

1-Day SARON - 0.35%

Monthly

JPHQ

9/30/24

292,021

CHF

(185,468)

Corporacion Acciona Energias Renovables SA

1-Day EONIA - 0.35%

Monthly

MSCS

8/05/24

206,119

EUR

15,108

Corporacion Financiera Alba SA

1-Day EONIA - 0.75%

Monthly

MSCS

3/13/25

23,737

EUR

(1,869)

COSMO Pharmaceuticals  NV

1-Day SARON - 0.35%

Monthly

JPHQ

7/17/24

105,670

CHF

(68,225)

Crest Nicholson Holdings PLC

1-Day SONIA - 0.30%

Monthly

MSCS

8/21/24

380,958

GBP

(137,947)

Croda International PLC

1-Day SONIA - 0.44%

Monthly

MSCS

11/27/24

351,834

GBP

23,154

Curro Holdings

1-Day SABOR - 1.50%

Monthly

MSCS

1/08/25

799,791

ZAR

(15,840)

Cy4gate SpA

Euro STR - 0.85%

Monthly

JPHQ

2/10/25

44,052

EUR

(4,588)

Cyfrowy Polsat SA

1-Day FEDEF - 0.50%

Monthly

MSCS

7/17/24

532,372

(15,777)

60			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortd (continued)

Daetwyler

Euro STR - 0.35%

Monthly

JPHQ

7/17/24

408,579

CHF

$(6,394)

Daikin Industries  Ltd.

1-Day MUTSCALM - 0.40%

Monthly

MSCS

9/30/24

67,374,400

JPY

31,496

Delivery Hero SE

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

188,971

EUR

(21,171)

Dermapharm Holding SE

Euro STR - 0.30%

Monthly

JPHQ

5/15/25

34,777

EUR

(639)

Deutsche Boerse

Euro STR - 0.30%

Monthly

JPHQ

11/27/24

135,363

EUR

(968)

Deutsche Wohnen SE

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

33,541

EUR

4,449

Diageo PLC

1-Day SONIA - 0.30%

Monthly

MSCS

11/27/24

477,626

GBP

125,286

DiaSorin

Euro STR - 0.30%

Monthly

JPHQ

4/25/25

199,893

EUR

(23,779)

Dino  Polska  SA

1-Day FEDEF - 0.50%

Monthly

MSCS

7/14/24

444,450

(68,157)

Dis-Chem Pharmacies

1-Day SABOR - 0.50%

Monthly

MSCS

12/26/24

4,559,385

ZAR

(62,044)

DiscoverIE Group PLC

1-Day SONIA - 0.30%

Monthly

MSCO

3/28/25

173,591

GBP

1,500

Discovery Ltd.

1-Day SABOR - 0.50%

Monthly

MSCS

7/17/24

12,626,552

ZAR

108,156

DNB Bank ASA

1-Week NIBOR - 0.275%

Monthly

SEBA

7/17/24

2,534,353

NOK

7,977

Dotdigital Group

1-Day SONIA - 0.30%

Monthly

MSCO

3/14/25

57,128

GBP

(5,865)

Dottikon ES Holding AG

1-Day SARON - 1.40%

Monthly

JPHQ

7/17/24

212,596

CHF

(44,767)

doValue SpA

Euro STR - 0.30%

Monthly

JPHQ

8/14/24

173,574

EUR

52,694

Dr. Martens PLC

1-Day SONIA - 0.30%

Monthly

MSCS

4/24/25

305,179

GBP

46,341

DRDGOLD Ltd.

1-Day SABOR - 1.00%

Monthly

MSCS

7/17/24

1,367,274

ZAR

(2,677)

DSM Firmenich AG

Euro STR - 0.30%

Monthly

JPHQ

4/16/25

276,547

EUR

(7,867)

DSV A/S

1-Week CIBOR - 0.28%

Monthly

SEBA

7/14/24

2,863,521

DKK

33,420

DT Capital Ltd.

1-Month HIBOR - 0.30%

Monthly

JPHQ

1/30/25

118,646

EUR

23,899

DWS Group SE

Euro STR - 0.75%

Monthly

JPHQ

3/20/25

175,145

EUR

(11,792)

Eckert &  Ziegler AG

Euro STR - 0.30%

Monthly

JPHQ

8/21/24

107,343

EUR

(25,764)

Ecopro BM

1-Day FEDEF - 10.875%

Monthly

MSCS

5/13/25

203,287

22,287

Ecopro BM

1-Day FEDEF - 7.75%

Monthly

MSCS

5/13/25

155,170

8,345

Ecora Resources PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

6,549

GBP

86

Edenred

1-Day EONIA - 0.30%

Monthly

MSCO

3/27/25

310,845

EUR

41,948

Edreams Odigeo SA

1-Day EONIA - 0.35%

Monthly

MSCS

7/17/24

158,295

EUR

(50,224)

Elia Group

Euro STR - 0.30%

Monthly

JPHQ

5/16/25

410,373

EUR

13,760

Elior Group SA

1-Day EONIA - 0.30%

Monthly

MSCS

7/15/24

242,124

EUR

(205,034)

Elisa Oyj

Euro STR - 0.28%

Monthly

SEBA

11/15/24

337,813

EUR

(3,979)

Embracer Group AB

1-Week STIBOR - 2.50%

Monthly

SEBA

3/04/25

775,896

SEK

(25,543)

Ems-Chemie AG

1-Day SARON - 0.35%

Monthly

JPHQ

7/17/24

388,704

CHF

(61,268)

ENAV SpA

Euro STR - 0.30%

Monthly

JPHQ

9/23/24

31,278

EUR

(612)

Ence Energia Y Celulosa SA

1-Day EONIA - 0.35%

Monthly

MSCO

2/10/25

380,893

EUR

(74,712)

Endeavour Mining PLC

1-Day SONIA - 0.30%

Monthly

MSCO

9/01/25

149,038

GBP

968

Enel SpA

1-Day EONIA - 0.50%

Monthly

MSCS

12/23/24

419,962

EUR

13,140

Enento Group OYJ

Euro STR - 0.28%

Monthly

SEBA

7/17/24

140,810

EUR

14,429

Energean PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

197,870

GBP

(40,440)

Engcon AB

1-Week STIBOR - 3.50%

Monthly

SEBA

10/04/24

755,435

SEK

(14,477)

Eni SpA

Euro STR - 0.30%

Monthly

JPHQ

1/13/25

241,433

EUR

7,359

Entain PLC

1-Day SONIA - 0.30%

Monthly

MSCO

2/17/25

460,460

GBP

118,470

Epiroc AB

1-Week STIBOR - 0.28%

Monthly

SEBA

11/27/24

5,626,111

SEK

(51,613)

EQT AB

1-Week STIBOR - 0.28%

Monthly

SEBA

7/17/24

3,797,431

SEK

(144,435)

Equites Property Fund Ltd.

1-Day SABOR - 0.50%

Monthly

MSCS

7/17/24

3,490,099

ZAR

(6,065)

Eramet SA

1-Day EONIA - 0.30%

Monthly

MSCS

8/30/24

213,352

EUR

(118,709)

franklintempleton.com			Annual Report			61

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortd (continued)

ERG  SpA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

56,610

EUR

$4,052

Erste Group Bank AG

Euro STR - 0.30%

Monthly

JPHQ

10/14/24

183,302

EUR

(33,956)

Esker SA

1-Day EONIA - 0.30%

Monthly

MSCS

5/20/25

143,431

EUR

(51,299)

Essentra PLC

1-Day SONIA - 0.30%

Monthly

MSCS

9/01/24

158,525

GBP

19,729

Essity AB

1-Week STIBOR - 0.28%

Monthly

SEBA

7/17/24

3,188,729

SEK

(37,927)

EuroAPI

1-Day EONIA - 0.30%

Monthly

MSCS

12/23/24

176,061

EUR

45,109

EuroGroup Laminations SpA

Euro STR - 0.30%

Monthly

JPHQ

8/12/24

434,065

EUR

(23,225)

Euronext

1-Day EONIA - 0.30%

Monthly

MSCS

7/17/24

160,526

EUR

(67,037)

Europris ASA

1-Week NIBOR - 0.275%

Monthly

SEBA

3/12/25

1,749,701

NOK

10,971

Evotec SE

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

118,967

EUR

15,919

Exail Technologies

1-Day EONIA - 6.875%

Monthly

MSCS

9/23/24

60,863

EUR

(5,938)

Experian PLC

1-Day SONIA - 0.30%

Monthly

MSCS

11/27/24

119,051

GBP

(40,050)

FD Technologies PLC

1-Day SONIA - 0.30%

Monthly

MSCS

8/12/24

257,865

GBP

(36,972)

Ferrari SpA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

62,831

EUR

(17,698)

Ferrovial SA

1-Day EONIA - 0.35%

Monthly

MSCS

7/17/24

466,273

EUR

(170,785)

Fevertree Drinks PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/25/24

282,364

GBP

7,004

Fielmann AG

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

284,126

EUR

(12,065)

FinecoBank SpA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

530,515

EUR

(98,932)

Fiskars Group OYJ

Euro STR - 0.45%

Monthly

SEBA

8/23/24

68,705

EUR

(176)

flatexDEGIRO AG

1-Month EURIBOR - 0.70%

Monthly

JPHQ

12/06/24

149,312

EUR

(11,366)

Flex LNG Ltd.

1-Week NIBOR - 3.50%

Monthly

SEBA

4/04/25

3,287,567

NOK

17,520

Flow Traders

Euro STR - 0.30%

Monthly

JPHQ

8/26/24

337,536

EUR

(40,274)

Fluidra SA

1-Day EONIA - 0.35%

Monthly

MSCS

9/30/24

347,386

EUR

(130,797)

Flutter Entertainment PLC

1-Day SONIA - 0.30%

Monthly

MSCS

8/30/24

194,373

GBP

(7,413)

Focusrite PLC

1-Day SONIA - 0.30%

Monthly

MSCS

6/03/25

48,326

GBP

9,863

Formycon AG

Euro STR - 23.00%

Monthly

JPHQ

3/31/25

42,165

EUR

15,119

Forterra PLC

1-Day SONIA - 0.30%

Monthly

MSCS

8/08/24

215,922

GBP

(33,135)

Francaise Energie

1-Day EONIA - 0.30%

Monthly

MSCS

7/17/24

85,074

EUR

12,222

Franchise Brands PLC

1-Day SONIA - 18.50%

Monthly

MSCS

9/27/24

8,698

GBP

(1,757)

Fraport AG

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

286,785

EUR

(40,638)

Fresnillo PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

225,461

GBP

(36,274)

F-Secure OYJ

Euro STR - 0.275%

Monthly

SEBA

9/09/24

34,255

EUR

(6,141)

Geberit AG

1-Day SARON - 0.35%

Monthly

JPHQ

7/17/24

383,403

CHF

(84,218)

Genuit Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

171,403

GBP

(107,810)

Getlink SE

1-Day EONIA - 0.30%

Monthly

MSCS

7/17/24

396,892

EUR

(33,479)

GFT Technologies SE

Euro STR - 0.30%

Monthly

JPHQ

4/24/25

178,264

EUR

10,197

Givaudan SA

1-Day SARON - 0.35%

Monthly

JPHQ

7/17/24

241,890

CHF

(102,731)

Gjensidige Forsikring ASA

1-Week NIBOR - 0.28%

Monthly

SEBA

7/17/24

4,955,198

NOK

(38,303)

Golden Ocean Group Ltd.

1-Week NIBOR - 0.28%

Monthly

SEBA

1/10/25

2,621,717

NOK

(175,923)

GPW

1-Day FEDEF - 1.125%

Monthly

MSCS

12/23/24

31,124

473

Grainger PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

80,840

GBP

(409)

Grand City Properties

Euro STR - 0.30%

Monthly

JPHQ

1/30/25

286,670

EUR

(101,333)

Great Portland Estates PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

535,944

GBP

165,652

Greatland Gold PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

223,098

GBP

(21,828)

Grenergy Renovables SA

1-Day EONIA - 2.38%

Monthly

MSCS

12/02/24

204,353

EUR

(25,975)

Grieg Seafood

1-Week NIBOR - 0.45%

Monthly

SEBA

4/16/25

1,405,214

NOK

(11,979)

62			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortd (continued)

Groupe ADP

1-Day EONIA - 0.30%

Monthly

MSCS

11/27/24

321,077

EUR

$(23,954)

Groupe Bruxelles Lambert NV

Euro STR - 0.30%

Monthly

JPHQ

7/12/24

345,020

EUR

(171)

Gruppo  MutuiOnline  SpA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

131,294

EUR

(37,106)

GVS

Euro STR - 0.30%

Monthly

JPHQ

7/13/24

87,968

EUR

(17,719)

H+H International A/S

1-Week CIBOR - 0.275%

Monthly

SEBA

10/17/24

524,159

DKK

(27,813)

Haleon PLC

1-Day SONIA - 0.30%

Monthly

MSCS

3/13/25

352,558

GBP

446

Halma PLC

1-Day SONIA - 0.30%

Monthly

MSCS

10/28/24

142,557

GBP

(6,151)

Hamborner REIT AG

Euro STR - 0.30%

Monthly

JPHQ

9/27/24

106,021

EUR

3,313

Hansa Biopharma AB

1-Week STIBOR - 1.00%

Monthly

SEBA

7/17/24

570,276

SEK

(17,088)

Heineken Holding

Euro STR - 0.30%

Monthly

JPHQ

11/01/24

159,316

EUR

(3,301)

Heineken

Euro STR - 0.35%

Monthly

JPHQ

11/27/24

527,113

EUR

(31,636)

Hektas

1-Day FEDEF - 15.00%

Monthly

MSCS

7/17/24

5,591

(41,696)

Helios Towers PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

206,630

GBP

(119,053)

HELLA GmbH &  Co. KGaA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

325,740

EUR

(54,252)

Helvetia Holding AG

1-Day SARON - 0.35%

Monthly

JPHQ

4/18/25

402,259

CHF

(8,360)

Henry Boot PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

19,188

GBP

4,229

Hensoldt AG

Euro STR - 0.30%

Monthly

JPHQ

3/20/25

229,268

EUR

(2,596)

Hexagon AB

1-Week STIBOR - 0.275%

Monthly

SEBA

4/01/25

1,436,428

SEK

(22,263)

Hexagon Purus ASA

1-Week NIBOR - 3.00%

Monthly

SEBA

8/28/24

413,889

NOK

(5,694)

Hexatronic Group AB

1-Week STIBOR - 0.275%

Monthly

SEBA

1/10/25

2,117,265

SEK

(110,607)

HMS Networks AB

1-Week STIBOR - 0.275%

Monthly

SEBA

9/13/24

2,728,912

SEK

(22,702)

Hufvudstaden AB

1-Week STIBOR - 0.28%

Monthly

SEBA

7/12/24

4,168,759

SEK

(20,542)

Hypoport SE

1-Day SABOR - 0.75%

Monthly

JPHQ

9/27/24

164,409

EUR

(197,844)

Iberdrola ORD

1-Day EONIA - 0.50%

Monthly

MSCO

12/02/24

428,484

EUR

10,363

Ibstock PLC

1-Day SONIA - 0.30%

Monthly

MSCS

11/07/24

263,088

GBP

(43,525)

ID Logistics Group

1-Day EONIA - 0.30%

Monthly

MSCS

5/22/25

248,032

EUR

(132,209)

Idox PLC

1-Day SONIA - 6.125%

Monthly

MSCO

3/24/25

17,324

GBP

(1,075)

IMCD Group NV

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

143,629

EUR

4,648

Immobel

Euro STR - 3.25%

Monthly

JPHQ

10/17/24

20,450

EUR

(951)

Immofinanz AG

Euro STR - 6.80%

Monthly

JPHQ

11/08/24

321,198

EUR

(31,843)

Impact Healthcare Reit ORD

1-Day SONIA - 1.10%

Monthly

MSCO

2/17/25

56,779

GBP

(5,442)

Industrial Select Sector

1-Day FEDEF - 0.30%

Monthly

MSCS

3/24/25

4,679,049

90,282

Industrie De Nora

Euro STR - 0.30%

Monthly

JPHQ

3/07/25

325,979

EUR

31,435

Indutrade AB

​1-Week STIBOR - 0.275%

Monthly

SEBA

6/03/25

315,518

SEK

(312)

Infrastrutture Wireless Italiane SpA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

416,240

EUR

32,787

Inmobiliaria Colonial SOCIMI SA

1-Day EONIA - 0.35%

Monthly

MSCS

4/22/25

122,012

EUR

(26,027)

Instalco AB

1-Week STIBOR - 0.45%

Monthly

SEBA

6/27/24

1,384,791

SEK

4,902

IntegraFin Holdings PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

173,491

GBP

(44,756)

International Petroleum Corp.

1-Week STIBOR - 0.275%

Monthly

SEBA

12/06/24

1,972,528

SEK

(57,863)

Interpump Group

Euro STR - 0.30%

Monthly

JPHQ

5/20/25

234,604

EUR

6,597

Interroll Group

1-Day SARON - 0.35%

Monthly

JPHQ

10/28/24

322,688

CHF

(7,544)

Investis Holdings SA

1-Day SARON - 0.35%

Monthly

JPHQ

9/12/24

14,404

CHF

(122)

​IREN SPA

Euro STR

Monthly

JPHQ

11/11/24

27,463

EUR

(77)

Italgas

Euro STR - 0.30%

Monthly

JPHQ

9/06/24

317,464

EUR

10,740

Italmobiliare

Euro STR - 0.30%

Monthly

JPHQ

9/27/24

79,072

EUR

(18,366)

James Halstead PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

33,906

GBP

1,721

franklintempleton.com			Annual Report			63

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortd (continued)

JDE Peet's NV

Euro STR - 0.30%

Monthly

JPHQ

6/06/24

472,455

EUR

$74,806

John Wood Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

240,970

GBP

(68,364)

JTC PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

299,865

GBP

(87,819)

Judges Scientific PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/05/24

103,717

GBP

(17,166)

Juventus FC

Euro STR - 17.30%

Monthly

JPHQ

9/02/24

147,342

EUR

41,199

Kainos Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

315,430

GBP

(40,470)

KBC Groep NV

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

323,885

EUR

(45,921)

Kempower OYJ

Euro STR - 3.75%

Monthly

SEBA

7/17/24

78,592

EUR

16,564

Kering SA

1-Month EURIBOR - 0.40%

Monthly

MSCS

11/27/24

390,863

EUR

107,738

Kerry Group PLC

1-Day EONIA - 0.30%

Monthly

MSCS

7/17/24

321,138

EUR

35,366

Kesko Corp.

Euro STR - 0.275%

Monthly

SEBA

10/17/24

275,566

EUR

(6,073)

K-Fast Holding AB

1-Week STIBOR - 0.275%

Monthly

SEBA

7/17/24

376,166

SEK

1,730

KGHM Polska Miedz SA

1-Day FEDEF - 0.50%

Monthly

MSCS

8/19/24

137,731

(55,579)

Kinnevik AB

1-Week STIBOR - 0.28%

Monthly

SEBA

7/17/24

1,734,394

SEK

(892)

Knorr-Bremse AG

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

64,723

EUR

(2,060)

Koenig & Bauer AG

Euro STR - 0.80%

Monthly

JPHQ

1/22/25

60,152

EUR

(12,204)

Komax

1-Day SARON - 0.35%

Monthly

JPHQ

7/25/24

396,537

CHF

98,714

Kruk

1-Day FEDEF - 0.50%

Monthly

MSCO

7/17/24

145,829

(6,208)

Kuehne+Nagel

1-Day SARON - 0.35%

Monthly

JPHQ

3/13/25

303,102

CHF

(16,494)

Lanxess AG

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

255,327

EUR

17,608

Lastminute.com N.V.

1-Day SARON - 0.35%

Monthly

JPHQ

11/11/24

34,784

CHF

5,655

LEG Immobilien AG

Euro STR - 0.30%

Monthly

JPHQ

8/21/24

83,688

EUR

(25,843)

Legal & General Group

1-Day SONIA - 0.30%

Monthly

MSCS

9/23/24

272,203

GBP

(54,928)

Lenzing AG

Euro STR - 0.30%

Monthly

JPHQ

7/14/24

230,593

EUR

(19,944)

LG Energy Solutions

1-Day FEDEF - 1.875%

Monthly

MSCS

10/07/24

329,094

52,906

Lifco

1-Week STIBOR - 0.28%

Monthly

SEBA

11/27/24

1,085,467

SEK

(4,936)

Linde PLC

Euro STR - 0.30%

Monthly

JPHQ

5/15/25

203,099

EUR

2,187

Linea Directa Aseguradora SA

1-Day EONIA - 0.35%

Monthly

MSCS

7/17/24

250,381

EUR

(77,329)

Liontrust Asset Management PLC

1-Day SONIA - 0.30%

Monthly

MSCO

4/25/25

89,898

GBP

(23,509)

London Stock Exchange Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

462,626

GBP

(66,334)

L'Oreal SA

1-Day EONIA - 0.30%

Monthly

MSCS

8/09/24

208,381

EUR

(7,565)

Lottomatica Group

Euro STR - 0.30%

Monthly

JPHQ

4/16/25

274,908

EUR

(15,451)

Lotus Bakeries NV

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

303,063

EUR

(169,207)

LVMH Moet Hennessy Louis Vuitton SE

1-Day EONIA - 0.30%

Monthly

MSCS

7/03/24

255,600

EUR

(10,127)

Mandatum OYJ

Euro STR - 0.275%

Monthly

SEBA

7/17/24

197,047

EUR

6,423

Marlowe PLC

1-Day SONIA - 0.30%

Monthly

MSCS

9/02/24

265,803

GBP

(87,947)

Marr

Euro STR - 0.30%

Monthly

JPHQ

12/11/24

450,681

EUR

(6,712)

Marshalls PLC

1-Day SONIA - 0.30%

Monthly

MSCS

5/27/25

121,731

GBP

3,011

Mas Real Estate

1-Day SABOR - 0.50%

Monthly

MSCO

12/13/24

3,950,114

ZAR

(360)

Matas A/S

1-Week CIBOR - 0.275%

Monthly

SEBA

4/17/25

1,268,493

DKK

(10,359)

Mayr-Melnhof Karton AG

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

198,316

EUR

19,227

mBank SA

1-Day FEDEF - 0.50%

Monthly

MSCS

7/14/24

324,648

(250,149)

Medacta Group SA

Euro STR - 0.35%

Monthly

JPHQ

7/17/24

140,770

CHF

(17,441)

Medartis AG

1-Day SARON - 0.85%

Monthly

JPHQ

7/17/24

29,267

CHF

(1,333)

Melexis

Euro STR - 0.30%

Monthly

JPHQ

4/03/25

52,301

EUR

(5,309)

64			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortd (continued)

Mercedes-Benz Group AG

Euro STR - 0.30%

Monthly

JPHQ

1/13/25

211,994

EUR

$(13,012)

Merlin Properties Socimi SA

1-Day EONIA - 0.30%

Monthly

MSCO

3/12/25

318,879

EUR

(62,160)

Metso Outotec OYJ

Euro STR - 0.28%

Monthly

SEBA

7/17/24

139,808

EUR

(19,108)

Meyer Burger AG

1-Day SARON - 0.95%

Monthly

JPHQ

7/14/24

73,473

CHF

1,485

Millennium

1-Day FEDEF - 0.50%

Monthly

MSCS

7/17/24

291,328

(228,864)

Mips AB

1-Week STIBOR - 0.28%

Monthly

SEBA

9/20/24

6,068,789

SEK

(48,252)

Mirbud

1-Day FEDEF - 13.00%

Monthly

MSCO

5/07/25

7,676

(927)

MJ Gleeson PLC

1-Day FEDEF - 0.30%

Monthly

MSCS

11/04/24

55,793

GBP

(15,113)

Mobilezone Holding AG

1-Day SARON - 0.35%

Monthly

JPHQ

3/04/25

138,337

CHF

836

Mo-Bruk SA

1-Day FEDEF - 2.375%

Monthly

MSCO

5/28/25

5,574

39

Momentum Group AB

1-Week STIBOR - 0.275%

Monthly

SEBA

3/27/25

348,615

SEK

(13,589)

Morgan Advanced Materials

1-Day SONIA - 0.30%

Monthly

MSCS

8/12/24

305,627

GBP

(78,692)

Motus Holdings Ltd.

1-Day SABOR - 0.50%

Monthly

MSCS

11/04/24

4,129,313

ZAR

27,291

National Grid PLC

1-Day SONIA

Monthly

MSCO

7/17/24

​1,126

GBP

(2,813)

National Grid PLC

1-Day SONIA - 0.35%

Monthly

MSCS

12/23/24

383,001

GBP

110,219

National Grid PLC

1-Day SONIA

Monthly

MSCS

12/23/24

​—

GBP

(24,555)

NCAB Group AB

1-Week STIBOR - 0.275%

Monthly

SEBA

2/24/25

2,066,741

SEK

(21,517)

NCC Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/15/24

212,107

GBP

(87,251)

Neoen

1-Day EONIA - 0.30%

Monthly

MSCS

7/17/24

312,915

EUR

(109,577)

Neste Corp.

Euro STR - 0.28%

Monthly

SEBA

7/17/24

286,351

EUR

95,479

Nestle SA

1-Day SARON - 0.35%

Monthly

JPHQ

11/27/24

163,161

CHF

12,395

Nexi SpA

Euro STR - 0.30%

Monthly

JPHQ

10/14/24

432,833

EUR

49,149

Nibe Industrier AB

1-Week STIBOR - 0.28%

Monthly

SEBA

8/12/24

4,215,223

SEK

58,389

Nobia AB

1-Week STIBOR - 0.275%

Monthly

SEBA

11/11/24

940,335

SEK

18,593

Nobia AB

1-Week STIBOR - 0.275%

Monthly

SEBA

11/11/24

​56,322

SEK

(29,114)

Noble Corp. PLC

1-Week CIBOR - 0.34%

Monthly

SEBA

8/05/24

1,104,619

DKK

14,753

Nokian Tyres PLC

Euro STR - 0.28%

Monthly

SEBA

8/23/24

448,017

EUR

(9,076)

Nolato AB

1-Week STIBOR - 0.28%

Monthly

SEBA

9/26/24

1,689,120

SEK

(54,643)

Nordic Semiconductor ASA

1-Week STIBOR - 0.275%

Monthly

SEBA

4/04/25

1,741,211

NOK

(50,536)

Nordnet AB

1-Week STIBOR - 0.28%

Monthly

SEBA

7/17/25

2,656,626

SEK

(36,802)

Norsk Hydro ASA

1-Week NIBOR - 0.275%

Monthly

SEBA

5/08/25

1,583,668

NOK

(7,835)

Novozymes A/S

1-Week CIBOR - 0.28%

Monthly

SEBA

7/17/24

615,676

DKK

(5,712)

NTG Nordic Transport Group

1-Week CIBOR - 0.275%

Monthly

SEBA

4/17/25

1,089,371

DKK

(7,911)

NX Filtration NV

Euro STR - 2.65%

Monthly

JPHQ

8/07/24

65,345

EUR

13,454

OC Oerlikon

1-Day SARON - 0.35%

Monthly

JPHQ

10/07/24

365,762

CHF

(143,976)

Ocado Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

189,118

GBP

70,709

OCI N.V.

Euro STR - 0.30%

Monthly

JPHQ

9/09/24

360,365

EUR

20,385

Oesterreichische Post AG

Euro STR - 3.80%

Monthly

JPHQ

8/23/24

193,151

EUR

11,794

Orange Belgium

Euro STR - 0.30%

Monthly

JPHQ

1/27/25

19,331

EUR

(2,824)

Orlen

1-Day FEDEF - 0.96%

Monthly

MSCO

5/07/25

109,935

5,595

Outsurance Group Limited

1-Day SABOR - 0.50%

Monthly

MSCS

10/03/24

7,603,348

ZAR

(675)

Oxford BioMedica PLC

1-Day SONIA - 0.30%

Monthly

MSCS

9/26/24

39,590

GBP

(35,032)

Oxford Instruments PLC

1-Day SONIA - 0.30%

Monthly

MSCO

4/25/25

92,940

GBP

(14,637)

Oxford Nanopore Technologies PLC

1-Day SONIA - 0.30%

Monthly

MSCS

5/13/25

89,241

GBP

33,036

P/F Bakkafrost

1-Week NIBOR - 0.28%

Monthly

SEBA

7/19/24

1,378,537

NOK

13,991

Palfinger AG

Euro STR - 0.30%

Monthly

JPHQ

7/12/24

38,226

EUR

(4,910)

franklintempleton.com			Annual Report			65

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortd (continued)

Partners Group Holding AG

1-Day SARON - 0.35%

Monthly

JPHQ

8/08/24

68,792

CHF

$(15,945)

Patrizia AG

Euro STR

Monthly

JPHQ

7/17/24

78,205

EUR

1,188

Pennon Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

308,271

GBP

49,859

Pepco

1-Day FEDEF - 5.25%

Monthly

MSCS

4/14/25

71,783

19,158

Pepkor

1-Day SABOR - 0.50%

Monthly

MSCS

10/10/24

5,773,421

ZAR

(12,327)

Pernod Ricard

1-Day EONIA - 0.30%

Monthly

MSCS

11/27/24

525,369

EUR

108,149

Persimmon PLC

1-Day SONIA - 0.30%

Monthly

MSCS

8/19/24

219,659

GBP

(27,423)

Petrofac Ltd.

1-Day SONIA - 0.30%

Monthly

MSCS

9/02/24

48,190

GBP

50,169

Pets at Home Group PLC

1-Day SONIA - 0.30%

Monthly

MSCO

3/04/25

261,971

GBP

(33,798)

Pfeiffer Vacuum

Euro STR - 0.30%

Monthly

JPHQ

3/07/25

255,192

EUR

(19,203)

PGS ASA

1-Week NIBOR - 0.275%

Monthly

SEBA

5/08/25

800,415

NOK

(10,737)

Pharma Mar SA

1-Day EONIA - 0.35%

Monthly

MSCO

1/22/25

150,921

EUR

(8,902)

Pharmanutra SpA

Euro STR - 0.30%

Monthly

JPHQ

1/10/25

81,045

EUR

8,587

Phoenix Group Holdings PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

446,368

GBP

33,744

Pick n Pay Group (The)

1-Day SABOR - 0.50%

Monthly

MSCS

12/23/24

718,637

ZAR

(3,860)

Pierer Mobility AG

1-Day SARON - 0.35%

Monthly

JPHQ

9/12/24

126,187

CHF

49,434

Pierre & Vacances

1-Day EONIA - 2.13%

Monthly

MSCS

8/15/24

6,751

EUR

(45)

PNE AG

Euro STR - 0.70%

Monthly

JPHQ

7/13/24

319,474

EUR

(47,534)

Polypeptide

1-Day SARON - 0.35%

Monthly

JPHQ

9/18/24

112,888

CHF

(110,253)

Prosus NV

Euro STR - 0.30%

Monthly

JPHQ

9/20/24

69,331

EUR

(4,810)

PRS REIT PLC (The)

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

229,745

GBP

22,667

Prudential PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/14/24

323,153

GBP

65,746

PSG Konsult Ltd.

1-Day SABOR - 0.875%

Monthly

MSCS

5/20/25

2,384,886

ZAR

(36,872)

Qintetiq Group PLC

1-Day SONIA - 0.30%

Monthly

MSCO

3/03/25

196,751

GBP

(54,692)

Qt Group OYJ

Euro STR - 4.16%

Monthly

SEBA

7/17/24

109,756

EUR

(28,213)

Rathbones Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

8/30/24

104,957

GBP

11,524

Ratos AB

1-Week STIBOR - 0.28%

Monthly

SEBA

7/17/24

2,195,450

SEK

(35,632)

Reckitt Benckiser Group  PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

207,828

GBP

53,784

Redeia Corporacion SA

1-Day EONIA - 0.35%

Monthly

MSCS

8/05/24

120,314

EUR

(13,722)

Reinet Investments S.C.A

1-Day SABOR - 0.50%

Monthly

MSCS

5/20/25

4,060,152

ZAR

(28,717)

Remgro Ltd.

1-Day SABOR - 0.50%

Monthly

MSCO

10/16/24

7,207,225

ZAR

2,269

Remy Cointreau

1-Day EONIA - 0.30%

Monthly

MSCS

12/11/24

591,089

EUR

173,061

Renishaw PLC

1-Day SONIA - 0.30%

Monthly

MSCS

2/13/25

227,165

GBP

(34,062)

Rentokil Initial PLC

1-Day FEDEF - 0.65%

Monthly

MSCS

11/27/24

408,549

GBP

97,087

Rentokil Initial PLC

1-Day SONIA - 0.30%

Monthly

MSCO

1/08/25

26,316

GBP

(179)

Reply SpA

Euro STR - 0.30%

Monthly

JPHQ

7/18/24

180,788

EUR

(60,506)

Resilient REIT Ltd.

1-Day SABOR - 0.50%

Monthly

MSCO

3/14/25

5,967,963

ZAR

15,416

Revenio Group Corp.

Euro STR - 0.28%

Monthly

SEBA

7/17/24

116,050

EUR

(11,560)

Ringkjoebing Landbobank A/S

1-Week CIBOR - 0.28%

Monthly

SEBA

7/17/24

2,473,449

DKK

(86,409)

Rotork PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

224,259

GBP

(10,054)

Royal Unibrew

1-Week CIBOR - 0.28%

Monthly

SEBA

11/27/24

2,995,946

DKK

(54,783)

RS Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

9/20/24

330,256

GBP

17,729

RTL Group

Euro STR - 0.30%

Monthly

JPHQ

1/30/25

556,819

EUR

102,504

RWE AG

Euro STR - 0.30%

Monthly

JPHQ

5/15/25

338,597

EUR

335

S4 Capital PLC

1-Day SONIA - 0.30%

Monthly

MSCS

8/24/24

109,852

GBP

(1,721)

Sacyr SA

1-Day EONIA - 0.35%

Monthly

MSCS

7/17/24

421,299

EUR

(126,491)

66			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortd (continued)

Saes Getters

Euro STR - 1.95%

Monthly

JPHQ

10/11/24

269,850

EUR

$64,235

Safestore Holdings PLC

1-Day SONIA - 0.30%

Monthly

MSCS

10/21/24

341,191

GBP

(96,568)

Saga PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

172,249

GBP

(5,940)

Sagax AB

1-Week STIBOR - 0.275%

Monthly

SEBA

12/06/24

2,798,381

SEK

(21,437)

Saipem SpA

1-Month EURIBOR - 6.65%

Monthly

JPHQ

2/26/25

198,588

EUR

(100,958)

Salmon Evolution ASA

1-Week NIBOR - 8.50%

Monthly

SEBA

7/12/24

1,831,529

NOK

(8,297)

Salvatore Ferragamo SpA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

418,285

EUR

121,474

Sampo PLC

Euro STR - 0.275%

Monthly

SEBA

7/17/24

220,448

EUR

12,629

Sanlam Ltd.

1-Day SABOR - 0.50%

Monthly

MSCS

7/17/24

2,691,333

ZAR

(10,338)

Santander Bank Polska  SA

1-Day FEDEF - 0.50%

Monthly

MSCS

7/17/24

83,154

(49,465)

Sartorius AG

Euro STR - 3.55%

Monthly

JPHQ

11/28/24

164,943

EUR

42,096

Sartorius Stedim Biotech

1-Day EONIA - 0.30%

Monthly

MSCS

6/21/24

128,902

EUR

29,680

SBM Offshore NV

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

527,426

EUR

(66,484)

Schibsted ASA

1-Week NIBOR - 0.28%

Monthly

SEBA

7/17/24

3,021,875

NOK

(96,451)

Schoeller-Bleckmann Oilfield Equipment AG

Euro STR - 0.30%

Monthly

JPHQ

7/13/24

231,615

EUR

53,946

Schroders PLC

1-Day SONIA - 0.30%

Monthly

MSCO

2/20/25

211,908

GBP

1,102

Sdiptech AB

1-Week STIBOR - 1.00%

Monthly

SEBA

7/17/24

2,405,117

SEK

(78,635)

Seadrill Ltd.

1-Week NIBOR - 0.275%

Monthly

SEBA

5/08/25

1,038,688

NOK

4,068

Sectra AB

1-Week STIBOR - 0.275%

Monthly

SEBA

3/27/25

2,230,746

SEK

(35,657)

secunet Security Networks AG

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

99,263

EUR

(3,747)

Sedana Medical AB

1-Week STIBOR - 0.275%

Monthly

SEBA

11/14/24

689,912

SEK

(22,446)

Seeing Machines Ltd.

1-Day SONIA - 5.75%

Monthly

MSCS

8/05/24

50,757

GBP

8,324

Segro PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

182,004

GBP

(44,897)

Senior PLC

1-Day SONIA - 0.30%

Monthly

MSCO

3/20/25

31,952

GBP

3,460

Sensirion AG

1-Day SARON - 0.35%

Monthly

JPHQ

4/22/25

383,346

CHF

27,270

Severn Trent PLC

1-Day SONIA - 0.30%

Monthly

MSCS

11/27/24

303,322

GBP

15,056

Severn Trent PLC

1-Day SONIA - 0.30%

Monthly

MSCO

1/08/25

14,199

GBP

817

Shaftesbury Capital PLC

1-Day SONIA - 0.30%

Monthly

MSCS

9/26/24

297,058

GBP

(80,193)

Shop Apotheke Europe NV

Euro STR - 0.85%

Monthly

JPHQ

7/17/24

137,631

EUR

(2,796)

Shurgard

Euro STR - 0.30%

Monthly

JPHQ

4/14/25

47,599

EUR

(600)

Siemens Healthineers AG

Euro STR - 0.30%

Monthly

JPHQ

8/21/24

152,388

EUR

(8,980)

SIG Group AG

Euro STR - 0.35%

Monthly

JPHQ

7/17/24

213,771

CHF

28,818

Sika

1-Day SARON - 0.35%

Monthly

JPHQ

11/08/24

264,817

CHF

(43,903)

Siltronic AG

Euro STR - 1.05%

Monthly

JPHQ

5/13/25

299,427

EUR

21,700

Sixt SE

Euro STR - 0.30%

Monthly

JPHQ

4/17/25

614,618

EUR

161,600

Skanska AB

1-Week STIBOR - 0.28%

Monthly

SEBA

8/07/24

770,822

SEK

2,520

Softcat PLC

1-Day SONIA - 0.30%

Monthly

MSCO

3/28/25

115,156

GBP

(6,005)

SoftwareONE

Euro STR - 0.35%

Monthly

JPHQ

7/15/24

125,696

CHF

(9,511)

Soitec SA

1-Day EONIA - 0.30%

Monthly

MSCS

8/12/24

68,710

EUR

(5,794)

Solaria Energia y Medio Ambiente SA

1-Day EONIA - 0.35%

Monthly

MSCS

7/17/24

105,288

EUR

21,454

SolGold PLC

1-Day SONIA - 0.56%

Monthly

MSCS

7/17/24

111,744

GBP

41,285

Soltec Power Holdings SA

1-Day EONIA - 0.73%

Monthly

MSCS

7/17/24

48,613

EUR

9,066

South32 Ltd.

1-Day SABOR - 2.125%

Monthly

MSCS

10/10/24

4,447,623

ZAR

(56,038)

SpareBank 1 SMN

1-Week NIBOR - 1.50%

Monthly

SEBA

10/23/24

4,580,038

NOK

(71,220)

franklintempleton.com			Annual Report			67

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortd (continued)

Sparebank 1 Oestlandet

1-Week NIBOR - 0.28%

Monthly

SEBA

12/23/24

1,015,965

NOK

$(5,308)

SpareBank 1 SR Bank ASA

1-Week NIBOR - 0.28%

Monthly

SEBA

7/22/24

1,933,758

NOK

(9,692)

Spirax-Sarco Engineering PLC

1-Day SONIA - 0.30%

Monthly

MSCS

11/27/24

442,232

GBP

40,495

St Galler Kantonalbank AG

1-Day SARON - 0.35%

Monthly

JPHQ

11/06/24

222,920

CHF

14,347

St James’s Place PLC

1-Day SONIA - 0.30%

Monthly

MSCO

5/06/25

112,825

GBP

(6,320)

Steico SE

Euro STR - 0.95%

Monthly

JPHQ

2/10/25

58,858

EUR

8,731

Stora Enso OYJ

Euro STR - 0.28%

Monthly

SEBA

8/05/24

344,654

EUR

(43,184)

Storskogen Group AB

1-Week STIBOR - 0.75%

Monthly

SEBA

7/17/24

1,512,972

SEK

(19,239)

STOXX Europe 600 Utilities Index

1-Day EONIA - 0.45%

Monthly

MSCS

9/13/24

3,546,397

EUR

186,443

STOXX Europe 600 Utilities Index

1-Day EONIA - 0.45%

Monthly

MSCS

3/25/25

2,227,378

EUR

34,455

STRATEC SE

Euro STR - 0.35%

Monthly

JPHQ

4/21/25

160,849

EUR

6,975

Straumann Group

1-Day SARON - 0.35%

Monthly

JPHQ

10/18/24

47,014

CHF

7,799

Straumann Group

1-Day SARON - 0.35%

Monthly

JPHQ

1/09/25

57,131

CHF

6,004

Strix Group PLC

1-Day SONIA - 2.00%

Monthly

MSCS

7/17/24

23,318

GBP

(5,125)

Sudzucker AG

Euro STR - 0.30%

Monthly

JPHQ

8/19/24

159,815

EUR

(6,356)

Super Group Ltd.

1-Day SABOR - 0.50%

Monthly

MSCS

7/19/24

1,764,899

ZAR

435

Supermarket Income REIT

1-Day SONIA - 0.28%

Monthly

MSCS

9/16/24

85,020

GBP

2,853

Svenska Cellulosa AB

1-Week STIBOR - 0.28%

Monthly

SEBA

7/17/24

5,359,343

SEK

(66,452)

Svenska Handelsbanken

1-Week STIBOR - 0.275%

Monthly

SEBA

5/08/25

2,386,427

SEK

(3,033)

Sweco AB

1-Week STIBOR - 0.275%

Monthly

SEBA

3/20/25

3,977,713

SEK

(84,064)

Swisscom AG

1-Day SARON - 0.35%

Monthly

JPHQ

2/03/25

120,197

CHF

5,717

Sword Group  SE

1-Day EONIA - 4.00%

Monthly

MSCS

7/17/24

6,845

EUR

(215)

Symrise AG

Euro STR - 0.30%

Monthly

JPHQ

9/27/24

282,840

EUR

(42,414)

Talenom OYJ

Euro STR - 2.50%

Monthly

SEBA

7/17/24

15,270

EUR

6,140

Talgo SA

1-Day EONIA - 0.35%

Monthly

MSCS

7/17/24

224,891

EUR

(80,615)

Tamburi

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

296,765

EUR

(31,179)

Tate & Lyle PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

293,034

GBP

(9,938)

Technoprobe

Euro STR - 0.30%

Monthly

JPHQ

10/16/24

414,477

EUR

(95,335)

Telecom Italia SpA

Euro STR - 0.75%

Monthly

JPHQ

7/14/24

422,704

EUR

32,016

Teleperformance

1-Day EONIA - 0.30%

Monthly

MSCO

3/27/25

32,690

EUR

(5,487)

Telia Company AB

1-Week STIBOR - 0.275%

Monthly

SEBA

5/06/25

2,717,699

SEK

(14,437)

Tessenderlo Group

Euro STR - 0.30%

Monthly

JPHQ

10/10/24

149,757

EUR

(9,830)

TGS ASA

1-Week NIBOR - 1.50%

Monthly

SEBA

4/16/25

1,190,780

NOK

(3,121)

Thermador Groupe SA

1-Day EONIA - 2.25%

Monthly

MSCS

8/16/24

38,850

EUR

(4,538)

ThyssenKrupp Nucera AG

Euro STR - 0.34%

Monthly

JPHQ

3/28/25

230,771

EUR

18,187

Tietoevry Corp.

Euro STR - 0.275%

Monthly

SEBA

11/29/24

357,319

EUR

30,261

Tikehau Capital SCA

1-Day EONIA - 4.00%

Monthly

MSCS

7/17/24

94,348

EUR

(2,652)

Tinexta SpA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

308,741

EUR

3,143

Tomra Systems ASA

1-Week NIBOR - 0.28%

Monthly

SEBA

1/08/25

1,741,022

NOK

(13,574)

Topdanmark A/S

1-Week CIBOR - 0.28%

Monthly

SEBA

7/26/24

3,231,414

DKK

34,898

Tracsis PLC

1-Day SONIA - 9.00%

Monthly

MSCO

3/06/25

11,090

GBP

(376)

Trainline PLC

1-Day SONIA - 0.30%

Monthly

MSCS

8/21/24

148,862

GBP

(10,457)

Transaction Capital Ltd.

1-Day SABOR - 0.50%

Monthly

MSCS

7/17/24

786,913

ZAR

20,183

Tritax EuroBox PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

78,470

GBP

(4,129)

Troax Group AB

1-Week STIBOR - 0.28%

Monthly

SEBA

8/02/24

1,079,538

SEK

(9,184)

Tryg A/S

1-Week CIBOR - 0.28%

Monthly

SEBA

7/13/24

2,662,692

DKK

3,400

68			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counterparty

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortd (continued)

Ubisoft Entertainment SA

1-Day EONIA - 0.30%

Monthly

MSCS

7/17/24

286,814

EUR

$12,823

Umicore NV

Euro STR - 0.30%

Monthly

JPHQ

8/05/24

373,723

EUR

48,864

Unilever

1-Day SONIA - 0.30%

Monthly

MSCS

10/16/24

205,630

GBP

(28,182)

UNIQA Insurance Group AG

Euro STR - 0.30%

Monthly

JPHQ

3/18/25

202,313

EUR

(7,201)

Unite Group PLC (The)

1-Day SONIA - 0.30%

Monthly

MSCS

7/05/24

287,699

GBP

(2,485)

United Internet AG

Euro STR - 0.30%

Monthly

JPHQ

3/20/25

360,825

EUR

(10,616)

United Utilities

1-Day SONIA - 0.30%

Monthly

MSCS

11/27/24

92,628

GBP

4,040

Urban Logistics REIT PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

323,708

GBP

12,478

Utilities Select Sector

1-Day FEDEF - 0.30%

Monthly

MSCS

3/24/25

4,731,930

(12,396)

Valmet OYJ

Euro STR - 0.28%

Monthly

SEBA

11/22/24

164,690

EUR

5,211

Valneva SE

1-Day EONIA - 4.50%

Monthly

MSCS

5/16/25

137,377

EUR

13,300

VAT Group  AG

1-Day SARON - 0.35%

Monthly

JPHQ

4/22/25

250,357

CHF

(105,810)

VERBIO  Vereinigte BioEnergie  AG

Euro STR - 1.00%

Monthly

JPHQ

7/01/24

337,727

EUR

45,855

Vestas Wind Systems A/S

1-Week CIBOR - 0.28%

Monthly

SEBA

7/12/24

2,209,835

DKK

(20,132)

Vestel

1-Day FEDEF - 7.63%

Monthly

MSCS

9/09/24

88,881

(36,666)

Victrex PLC

1-Day SONIA - 0.30%

Monthly

MSCS

7/17/24

402,275

GBP

48,156

Vidrala SA

1-Day EONIA - 0.35%

Monthly

MSCS

9/30/24

146,478

EUR

(40,389)

Viscofan SA

1-Day EONIA - 0.35%

Monthly

MSCS

8/05/24

319,559

EUR

(15,482)

Vitec Software Group AB

1-Week STIBOR - 0.275%

Monthly

SEBA

5/22/25

2,747,253

SEK

1,946

VNV Global AB

1-Week STIBOR - 0.275%

Monthly

SEBA

2/17/25

142,589

SEK

(3,032)

Voltalia SA

1-Day EONIA - 0.30%

Monthly

MSCS

7/17/24

140,383

EUR

8,670

Volue ASA

1-Week NIBOR - 0.75%

Monthly

SEBA

4/15/25

445,415

NOK

(11,386)

Vopak

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

104,683

EUR

(2,137)

Wacker Chemie AG

Euro STR - 0.30%

Monthly

JPHQ

3/20/25

296,226

EUR

17,458

Wacker Neuson SE

Euro STR - 0.30%

Monthly

JPHQ

4/01/25

122,054

EUR

5,386

Waga Energy SA

1-Day EONIA - 0.75%

Monthly

MSCS

7/17/24

35,615

EUR

14,151

Wallenstam AB Series B

1-Week STIBOR - 0.275%

Monthly

SEBA

7/17/24

2,612,083

SEK

(54,003)

Warteck

1-Day SARON - 6.50%

Monthly

JPHQ

2/03/25

16,543

CHF

38

WeBuyCars Pty Ltd.

1-Day SABOR - 2.75%

Monthly

MSCO

7/17/24

​31,103

ZAR

(39,556)

Wendel Group

1-Day EONIA - 0.30%

Monthly

MSCS

5/27/25

468,931

EUR

(31,346)

Whitbread PLC

1-Day SONIA - 0.30%

Monthly

MSCS

4/14/25

94,126

GBP

9,104

WithSecure Corp.

1-Week Euro STR - 0.275%

Monthly

SEBA

4/22/25

75,517

EUR

12,332

Wizz Air Holdings PLC

1-Day SONIA - 0.30%

Monthly

MSCS

12/19/24

288,310

GBP

(47,770)

WPP PLC

1-Day SONIA - 0.30%

Monthly

MSCS

9/30/24

178,045

GBP

(26,535)

Xvivo Perfusion AB

1-Week STIBOR - 0.28%

Monthly

SEBA

7/17/24

731,183

SEK

(39,965)

YIT Corp.

Euro STR - 0.275%

Monthly

SEBA

11/08/24

154,947

EUR

(51,768)

YouGov ORD

1-Day SONIA - 0.30%

Monthly

MSCO

5/08/25

124,588

GBP

(9,571)

Yubico AB

1-Week STIBOR - 1.25%

Monthly

SEBA

4/03/25

1,182,145

SEK

(35,109)

Zealand Pharma A/S

1-Week CIBOR - 0.45%

Monthly

SEBA

7/17/25

744,342

DKK

(2,289)

Zignago Vetro SpA

Euro STR - 0.30%

Monthly

JPHQ

7/17/24

149,287

EUR

(3,262)

Zur Rose Group AG

1-Day SARON - 2.10%

Monthly

JPHQ

7/17/24

228,955

CHF

(87,628)

(6,953,535)

Total - Total Return Swap Contracts

$7,376,074

franklintempleton.com			Annual Report			69

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED SCHEDULE OF INVESTMENTS

K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

* In U.S. dollars unless otherwise indicated.

a The Fund receives the total return on the underlying instrument and pays a variable financing rate.

b Fair valued using significant unobservable inputs. See Note 13 regarding fair value investments.

c See Note 9 regarding investments in Russian securities. Notional value rounds to less than 1.

d The Fund receives the variable financing rate and pays the total return on the underlying instrument.

See Note 11 regarding other derivative information.

See Abbreviations on page 90.

70			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statement of Assets and Liabilities

May 31, 2024

K2 Alternative Strategies Fund

	Assets:
	Investments in securities:
	Cost – Unaffiliated issuers			$529,853,625
	Cost – Non-controlled affiliates (Note 3f)			882,000
	Value – Unaffiliated issuers†			$557,942,010
	Value – Non-controlled affiliates (Note 3f)			882,000
	Cash			​145,512
	Foreign currency, at value (cost $16,422,200)			16,452,011
	Receivables:
	Investment securities sold			14,409,444
	Capital shares sold			868,556
	Dividends and interest			2,895,307
	Deposits with brokers for:
	Securities sold short			95,853,076
	OTC derivative contracts			45,326,513
	Futures contracts			15,740,992
	Centrally cleared swap contracts			4,309,860
	Due from brokers			​228,442
	Variation margin on centrally cleared swap contracts			100,704
	OTC swap contracts (upfront payments $907,067)			534,541
	Unrealized appreciation on OTC forward exchange contracts			2,227,550
	Unrealized appreciation on OTC swap contracts			23,979,248
	Other assets			3,271
	Total assets			​781,899,037
	Liabilities:
	Payables:
	Investment securities purchased			5,471,673
	Capital shares redeemed			318,332
	Management fees			810,573
	Distribution fees			20,385
	Trustees’ fees and expenses			8,707
	Transfer agent fees			208,832
	Due to brokers			​14,257,263
	Variation margin on futures contracts			532,365
	OTC swap contracts (upfront receipts $672,426)			658,440
	Options written, at value (premiums received $166,953)			653,981
	Securities sold short, at value (proceeds $108,064,738)			105,141,373
	Payable upon return of securities loaned (Note 1f)			882,000
	Unrealized depreciation on OTC forward exchange contracts			868,001
	Unrealized depreciation on OTC swap contracts			16,849,174
	Unrealized depreciation on unfunded loan commitments (Note 10)			35,553
	Accrued expenses and other liabilities			512,442
	Total liabilities			​147,229,094
	Net assets, at value			$634,669,943
	Net assets consist of:
	Paid-in capital			$608,096,555
	Total distributable earnings (loss)			​26,573,388
	Net assets, at value			$634,669,943
	†Includes securities loaned			$2,504,609

franklintempleton.com			The accompanying notes are an integral part of these consolidated financial statements. | Annual Report			71

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statement of Assets and Liabilities (continued)

May 31, 2024

K2 Alternative Strategies Fund

	Class A:
	Net assets, at value			$63,319,597
	Shares outstanding			5,425,258
	Net asset value per sharea,b			$11.67
	Maximum offering price per share (net asset value per share ÷ 94.50%)a			$12.35
	Class C:
	Net assets, at value			$7,957,041
	Shares outstanding			706,135
	Net asset value and maximum offering price per sharea,b			$11.27
	Class R:
	Net assets, at value			$347,786
	Shares outstanding			29,657
	Net asset value and maximum offering price per sharea			$11.73
	Class R6:
	Net assets, at value			$124,279,030
	Shares outstanding			10,560,828
	Net asset value and maximum offering price per sharea			$11.77
	Advisor Class:
	Net assets, at value			$438,766,489
	Shares outstanding			37,325,094
	Net asset value and maximum offering price per sharea			$11.76

aNet asset value per share amount may not recalculate due to rounding.

bRedemption price is equal to net asset value less contingent deferred sales charges, if applicable.

72			Annual Report | The accompanying notes are an integral part of these consolidated financial statements.			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statement of Operations

for the year ended May 31, 2024

K2 Alternative Strategies Fund

	Investment income:
	Dividends: (net of foreign taxes)*
	Unaffiliated issuers			$​13,541,238
	Interest: (net of foreign taxes)~
	Unaffiliated issuers			​20,795,361
	Income from securities loaned:
	Unaffiliated entities (net of fees and rebates)			(28,360)
	Non-controlled affiliates (Note 3f)			71,975
	​Total investment income			​34,380,214
	Expenses:
	Management fees (Note 3a)			13,308,902
	Distribution fees: (Note 3c)
	Class A			170,084
	Class C			112,951
	Class R			1,631
	Transfer agent fees: (Note 3e)
	Class A			62,985
	Class C			11,432
	Class R			284
	Class R6			12,264
	Advisor Class			569,868
	Custodian fees (Note 4) .			321,632
	Reports to shareholders fees			60,424
	Registration and filing fees			112,620
	Professional fees			591,763
	Trustees’ fees and expenses			326,777
	​Dividends on securities sold short			​1,446,285
	Interest on securities sold short			​1,898,427
	Other			142,935
	Total expenses			19,151,264
	Expense reductions (Note 4)			(322,500)
	Expenses waived/paid by affiliates (Note 3f and 3g)			(1,877,142)
	Net expenses			16,951,622
	​Net investment income			​17,428,592
	Realized and unrealized gains (losses):
	Net realized gain (loss) from:
	Investments:
	Unaffiliated issuers			​36,463,944
	Written options			1,155,633
	Foreign currency transactions			373,626
	Forward exchange contracts			(5,152,376)
	Futures contracts			​1,308,768
	Securities sold short			881,027
	Swap contracts			(324,844)
	​Net realized gain (loss)			​34,705,778
	Net change in unrealized appreciation (depreciation) on:
	Investments:
	Unaffiliated issuers			12,915,793
	Written options			(729,288)
	Translation of other assets and liabilities denominated in foreign currencies			​(33,923)
	Forward exchange contracts			2,994,307
	Futures contracts			(819,287)
	Securities sold short			(11,798,506)
	Swap contracts			9,912,497
	Net change in unrealized appreciation (depreciation)			​12,441,593
	​Net realized and unrealized gain (loss)			​47,147,371
	​Net increase (decrease) in net assets resulting from operations			$​64,575,963
	*Foreign taxes withheld on dividends			$27,214
	~Foreign taxes withheld on interest			$21,291

franklintempleton.com			The accompanying notes are an integral part of these consolidated financial statements. | Annual Report			73

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statements of Changes in Net Assets

K2 Alternative Strategies Fund

				Year Ended May 31,
				2024			2023
	Increase (decrease) in net assets:
	Operations:
	Net investment income			$​17,428,592			$15,741,185
	Net realized gain (loss)			​34,705,778			(11,553,755)
	Net change in unrealized appreciation (depreciation)			​12,441,593			(20,733,832)
	​Net increase (decrease) in net assets resulting from operations			​64,575,963			(16,546,402)
	Distributions to shareholders:
	Class A			(293,245)			(2,298,782)
	Class C			—			(366,579)
	Class R			(477)			(6,760)
	Class R6			(452,983)			(1,623,691)
	Advisor Class			(3,755,928)			(25,006,493)
	​Total distributions to shareholders			(4,502,633)			(29,302,305)
	Capital share transactions: (Note 2)
	Class A			(19,014,149)			(14,390,545)
	Class C			(8,605,211)			(7,897,223)
	Class R			(32,623)			(443,340)
	Class R6			73,646,565			(1,408,481)
	Advisor Class			(319,099,003)			(349,425,448)
	Total capital share transactions			(273,104,421)			(373,565,037)
	​Net increase (decrease) in net assets			(213,031,091)			(419,413,744)
	Net assets:
	Beginning of year			847,701,034			1,267,114,778
	End of year			$634,669,943			$847,701,034

74			Annual Report | The accompanying notes are an integral part of these consolidated financial statements.			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

Notes to Consolidated Financial Statements

K2 Alternative Strategies Fund

1. Organization and Significant Accounting Policies

Franklin Alternative Strategies Funds (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of one fund, K2 Alternative Strategies Fund (Fund). The Fund follows the accounting and reporting guidance in Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946, Financial Services – Investment Companies (ASC 946) and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP), including, but not limited to, ASC 946. The Fund offers five classes of shares: Class A, Class C, Class R, Class R6 and Advisor Class. Class C shares automatically convert to Class A shares on a monthly basis, after they have been held for 8 years. Each class of shares may differ by its initial sales load, contingent deferred sales charges, voting rights on matters affecting a single class, its exchange privilege and fees due to differing arrangements for distribution and transfer agent fees.

The following summarizes the Fund’s significant accounting policies.

a. Financial Instrument Valuation

The Fund’s 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 Fund calculates 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 Fund’s investment manager as the valuation designee and has responsibility for oversight of valuation. The investment manager is assisted by the Fund’s administrator in performing this responsibility, including leading the cross-functional Valuation Committee (VC). The Fund 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 Fund’s 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. Securities denominated in a foreign currency are converted into their U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the date that the values of the foreign debt securities are determined.

Investments in open-end mutual funds are valued at the closing NAV.

Certain derivative financial instruments are centrally cleared or trade in the OTC market. The Fund’s 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 Fund’s net benefit or obligation under the derivative contract, as measured by the fair value of the contract, is included in net assets.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Fund primarily employs 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.

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 Fund’s 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 Fund. As a result, differences may arise between the value of the Fund’s portfolio

franklintempleton.com			Annual Report			75

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

1. Organization and Significant Accounting Policies (continued)

a. Financial Instrument Valuation (continued)

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 Fund’s portfolio securities to the latest indications of fair value at 4 p.m. Eastern time. At May 31, 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 Fund’s NAV is not calculated, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund 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 Fund 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 Fund does 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 Consolidated Statement 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. Securities Purchased on a Delayed Delivery Basis

The Fund purchases securities on a delayed delivery basis, with payment and delivery scheduled for a future date. These transactions are subject to market fluctuations and are subject to the risk that the value at delivery may be more or less than the trade date purchase price. Although the Fund will generally purchase these securities with the intention of holding the securities, it may sell the securities before the settlement date. Sufficient assets have been segregated for these securities.

d. Derivative Financial Instruments

The Fund 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 Consolidated Statement of Assets and Liabilities. Realized gain and loss and unrealized appreciation and depreciation on these contracts for the period are included in the Consolidated Statement of Operations.

Derivative counterparty credit risk is managed through a formal evaluation of the creditworthiness of all potential counterparties. The Fund attempts to reduce its exposure to counterparty credit risk on OTC derivatives, whenever possible, by entering into International Swaps and Derivatives Association (ISDA) master agreements with certain counterparties. These agreements contain various provisions, including but not limited to collateral requirements, events of default, or early termination. Termination events applicable to the counterparty include certain deteriorations in the credit quality of the counterparty. Termination events applicable to the Fund include failure of the Fund to maintain certain net asset levels and/or limit the decline in net assets over various periods of time. In the event of default or early termination, the ISDA master agreement gives the non-defaulting party the right to net and close-out all transactions traded, whether or not arising under the ISDA agreement, to one net amount payable by one counterparty to the other. However, absent an event of default or early termination, OTC derivative assets and liabilities are presented gross and not offset in the Consolidated Statement of Assets and Liabilities. Early termination by the counterparty may result in an immediate payment by the Fund of any net liability owed to that counterparty under the ISDA agreement.

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. For OTC derivatives traded under an ISDA master agreement,

76			Annual Report			franklintempleton.com

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

1. Organization and Significant Accounting Policies (continued)

d. Derivative Financial Instruments (continued)

posting of collateral is required by either the Fund or the applicable counterparty if the total net exposure of all OTC derivatives with the applicable counterparty exceeds the minimum transfer amount, which typically ranges from $100,000 to $250,000, and can vary depending on the counterparty and the type of agreement. Generally, collateral is determined at the close of Fund business each day and any additional collateral required due to changes in derivative values may be delivered by the Fund or the counterparty the next business day, or within a few business days. Collateral pledged and/or received by the Fund for OTC derivatives, if any, is held in segregated accounts with the Fund’s custodian/counterparty broker and can be in the form of cash and/or securities. Unrestricted cash may be invested according to the Fund’s investment objectives. To the extent that the amounts due to the Fund from its counterparties are not subject to collateralization or are not fully collateralized, the Fund bears the risk of loss from counterparty non-performance.

The Fund entered into exchange traded futures contracts primarily to manage and/or gain exposure to commodity price, interest rate, equity price and foreign exchange 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 Consolidated Statement of Assets and Liabilities.

The Fund entered into OTC forward exchange contracts primarily to manage and/or gain exposure to certain foreign currencies. A forward exchange contract is an agreement between the Fund and a counterparty to buy or sell a foreign currency at a specific exchange rate on a future date.

The Fund entered into credit default swap contracts primarily to manage and/or gain exposure to credit risk. A credit default swap is an agreement between the Fund and a counterparty whereby the buyer of the contract receives credit protection and the seller of the contract guarantees the credit worthiness of a referenced debt obligation. These agreements may be privately negotiated in the over-the-counter market (OTC credit default swaps) or may be executed in a multilateral trade facility platform, such as a registered exchange (centrally cleared credit default swaps). The underlying referenced debt obligation may be a single issuer of corporate or sovereign debt, a credit index, a basket of issuers or indices, or a tranche of a credit index or basket of issuers or indices. In the event of a default of the underlying referenced debt obligation, the buyer is entitled to receive the notional amount of the credit default swap contract from the seller in exchange for the referenced debt obligation, a net settlement amount equal to the notional amount of the credit default swap less the recovery value of the referenced debt obligation, or other agreed upon amount. For centrally cleared credit default swaps, 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 Consolidated Statement of Assets and Liabilities. Over the term of the contract, the buyer pays the seller a periodic stream of payments, provided that no event of default has occurred. Such periodic payments are accrued daily as an unrealized appreciation or depreciation until the payments are made, at which time they are realized. Upfront payments and receipts are reflected in the Consolidated Statement of Assets and Liabilities and represent compensating factors between stated terms of the credit default swap agreement and prevailing market conditions (credit spreads and other relevant factors). These upfront payments and receipts are amortized over the term of the contract as a realized gain or loss in the Consolidated Statement of Operations.

The Fund entered into OTC cross-currency swap contracts primarily to manage and/or gain exposure to certain foreign currencies. A cross-currency swap is an agreement between the Fund and a counterparty to exchange cash flows (determined using either a fixed or floating rate) based on the notional amounts of two different currencies. The notional amounts are typically determined based on the spot exchange rates at the opening of the contract. Cross-currency swaps may require the exchange of notional amounts at the opening and/or closing of the contract. Over the term of the contract, contractually required payments to be paid and to be received are accrued daily and recorded as unrealized appreciation or depreciation until the payments are made, at which time they are realized. Any upfront payments and receipts are reflected in the Consolidated Statement of Assets and Liabilities and represent compensating factors between stated terms of the cross-currency swap contract and prevailing market conditions (interest rate spreads and other relevant factors). These upfront payments and receipts are amortized over the term of the contract as a realized gain or loss in the Consolidated Statement of Operations, if any. At May 31, 2024, the Fund had no cross-currency swap contracts.

The Fund entered into interest rate swap contracts primarily to manage and/or gain exposure to interest rate risk. An interest rate swap is an agreement between the Fund and a counterparty to exchange cash flows based on the difference between two interest rates, applied to a notional amount. These agreements may be privately negotiated in the over-the-counter market (OTC interest rate swaps) or may be executed on a registered exchange (centrally cleared interest rate swaps). For centrally cleared interest rate swaps, 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 Consolidated Statement of Assets and Liabilities. Over the term of the contract, contractually required payments to be paid and to be received are accrued daily and recorded as unrealized appreciation or depreciation until the payments are made, at which time they are realized.

The Fund entered into OTC total return swap contracts primarily to manage and/or gain exposure to interest rate, foreign exchange rate and equity price risk of an underlying instrument such as a stock, bond, index or basket of securities or indices. A total return swap is an agreement between the

franklintempleton.com			Annual Report			77

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

1. Organization and Significant Accounting Policies (continued)

d. Derivative Financial Instruments (continued)

Fund and a counterparty to exchange a return linked to an underlying instrument for a floating or fixed rate payment, both based upon a notional amount. Over the term of the contract, contractually required payments to be paid or received are accrued daily and recorded as unrealized appreciation or depreciation until the payments are made, at which time they are recognized as realized gain or loss.

The Fund purchased or wrote exchange traded and/or OTC option contracts primarily to manage and/or gain exposure to equity price, interest rate and foreign exchange rate 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.

See Note 11 regarding other derivative information.

e. Securities Sold Short

The Fund is engaged in selling securities short, which obligates the Fund to replace a borrowed security with the same security at current fair value. The Fund incurs a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. The Fund realizes a gain if the price of the security declines between those dates. Gains are limited to the price at which the Fund sold the security short, while losses are potentially unlimited in size.

The Fund is required to establish a margin account with the broker lending the security sold short. While the short sale is outstanding, the broker retains the proceeds of the short sale to the extent necessary to meet margin requirements until the short position is closed out. A deposit must also be maintained with the Fund’s custodian/counterparty broker consisting of cash and/or securities having a value equal to a specified percentage of the value of the securities sold short. The Fund may receive income from the investment of cash collateral. The Fund is obligated to pay fees for borrowing the securities sold short and is required to pay the counterparty any dividends and/or interest due on securities sold short. Such dividends and/or interest and any security borrowing fees are recorded as an expense to the Fund.

f. Securities Lending

The Fund participates in an agency based securities lending program to earn additional income. The Fund receives collateral in the form of cash and/or U.S. Government and

Agency Securities against the loaned securities in an amount equal to at least 102% of the fair value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the fair value of loaned securities, as determined at the close of Fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. Any cash collateral received is deposited into a joint cash account with other funds and is used to invest in a money market fund managed by Franklin Advisers, Inc., an affiliate of the Fund, and/or a joint repurchase agreement. Additionally, the Fund received $1,753,680 in U.S. Government and Agency Securities as collateral. These securities received as collateral are held in segregated accounts with the Fund’s custodian. The Fund cannot repledge or resell these securities received as collateral. As such, the non-cash collateral is excluded from the Consolidated Statement of Assets and Liabilities. The Fund may receive income from the investment of cash collateral, in addition to lending fees paid by the borrower. Income from securities loaned, net of fees paid to the securities lending agent and/or third party vendor, is reported separately in the Consolidated Statement of Operations. The Fund bears the market risk with respect to any cash collateral investment, securities loaned, and the risk that the agent may default on its obligation to the Fund. If the borrower defaults on its obligations to return the securities loaned, the Fund has the right to repurchase the securities in the open market using the collateral received. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower.

g. Investments in K2 Holdings Investment Corp. (K2 Subsidiary)

The Fund invests in certain financial instruments and commodity-linked derivative investments through its investment in the K2 Subsidiary. The K2 Subsidiary is a Cayman Islands exempted company with limited liability, is a wholly-owned subsidiary of the Fund, and is able to invest in certain financial instruments and commodity-linked derivative investments consistent with the investment objective of the Fund. At May 31, 2024, the K2 Subsidiary’s investments, as well as any other assets and liabilities of the K2 Subsidiary, are reflected in the Fund’s Consolidated Schedule of Investments and Consolidated Statement of Assets and Liabilities. All intercompany transactions and balances have been eliminated. For tax purposes, the Fund is required to increase its taxable income by its share of the K2 Subsidiary’s income. Net losses incurred by the K2 Subsidiary cannot offset income earned by the Fund and cannot be carried back or forward by the K2 Subsidiary to offset income from prior or future years. At May 31, 2024, the net assets of the K2 Subsidiary were $55,490,691 representing 8.7% of the Fund’s consolidated net assets. The Fund’s investment in the K2 Subsidiary is limited to 25% of consolidated assets.

h. Senior Floating Rate Interests

The Fund invests in senior secured corporate loans that pay interest at rates which are periodically reset by reference to a base lending rate plus a spread. These base lending rates are

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

1. Organization and Significant Accounting Policies (continued)

h. Senior Floating Rate Interests (continued)

generally the prime rate offered by a designated U.S. bank, or the London Interbank Offered Rate (LIBOR), or the Secured Overnight Financing Rate (SOFR). Senior secured corporate loans often require prepayment of principal from excess cash flows, at the discretion of the borrower. As a result, actual maturity may be substantially less than the stated maturity. Senior secured corporate loans in which the Fund invests are generally readily marketable, but may be subject to certain restrictions on resale.

i. Income and Deferred Taxes

It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable 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 Fund 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 it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply, the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.

The 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 May 31, 2024, the Fund has determined that no tax liability is required in its consolidated 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.

j. 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. Paydown gains and losses are recorded as an adjustment to interest income. The Fund may receive other income from investments in senior secured corporate loans or unfunded commitments, including amendment fees, consent fees or commitment fees. These fees are recorded as income when received by the Fund. Facility fees are recognized as income over the expected term of the loan. Dividend income and dividends declared on securities sold short are 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 is received by the Fund. Distributions to shareholders 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.

Realized and unrealized gains and losses and net investment income, excluding class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions by class are generally due to differences in class specific expenses.

k. 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.

l. 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 Fund, 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.

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

2. Shares of Beneficial Interest

At May 31, 2024, there were an unlimited number of shares authorized (without par value). Transactions in the Fund’s shares were as follows:

				Year Ended May 31,
				2024						2023
				Shares			Amount			Shares			Amount
	Class A Shares:
	Shares solda			​901,608			$​9,940,863			1,184,496			$12,884,556
	Shares issued in reinvestment of distributions			​24,442			​267,146			197,144			2,107,467
	Shares redeemed			(2,655,907)			(29,222,158)			(2,702,826)			(29,382,568)
	Net increase (decrease)			(1,729,857)			$(19,014,149)			(1,321,186)			$(14,390,545)
	Class C Shares:
	Shares sold			31,350			$335,902			112,939			$1,186,468
	Shares issued in reinvestment of distributions			—			—			30,061			312,336
	Shares redeemeda			(843,526)			(8,941,113)			(892,790)			(9,396,027)
	Net increase (decrease)			(812,176)			$(8,605,211)			(749,790)			$(7,897,223)
	Class R Shares:
	Shares sold			​5,288			$​59,744			5,131			$55,176
	Shares issued in reinvestment of distributions			​44			​477			629			6,760
	Shares redeemed			(8,352)			(92,844)			(45,962)			(505,276)
	Net increase (decrease)			(3,020)			$(32,623)			(40,202)			$(443,340)
	Class R6 Shares:
	Shares sold			​9,340,788			$​105,720,673			1,973,905			$21,789,501
	Shares issued in reinvestment of distributions			​36,852			​405,743			127,748			1,375,848
	Shares redeemed			(2,916,319)			(32,479,851)			(2,249,882)			(24,573,830)
	Net increase (decrease)			6,461,321			$73,646,565			(148,229)			$(1,408,481)
	Advisor Class Shares:
	Shares sold			​5,211,753			$​57,591,690			13,145,615			$144,459,116
	Shares issued in reinvestment of distributions			​240,415			​2,644,566			1,667,367			17,940,869
	Shares redeemed			(34,178,446)			(379,335,259)			(46,582,302)			(511,825,433)
	Net increase (decrease)			(28,726,278)			$(319,099,003)			(31,769,320)			$(349,425,448)

aMay include a portion of Class C shares that were automatically converted to Class A.

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:

	Subsidiary			Affiliation
	K2/D&S Management Co., L.L.C. (K2 Advisors)			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

a. Management Fees

The Fund and K2 Subsidiary pay an investment management fee, calculated daily and paid monthly, to K2 Advisors based on the average daily net assets of the Fund and K2 Subsidiary as follows:

	Annualized Fee Rate			Net Assets
	1.70%			Up to and including $1 billion
	1.65%			Over $1 billion, up to and including $1.5 billion
	1.60%			Over $1.5 billion, up to and including $3 billion
	1.55%			In excess of $3 billion

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

3. Tansactions with Affiliates (continued)

a. Management Fees (continued)

Prior to March 1, 2024, the Fund and K2 Subsidiary paid an investment management fee, calculated daily and paid monthly, to K2 Advisors based on the average daily net assets of the Fund and K2 Subsidiary as follows:

	Annualized Fee Rate			Net Assets
	1.90%			Up to and including $1 billion
	1.85%			Over $1 billion, up to and including $1.5 billion
	1.80%			Over $1.5 billion, up to and including $3 billion
	1.75%			In excess of $3 billion

For the year ended May 31, 2024, the gross effective management fee rate was 1.86% of the Fund’s average daily net assets.

Management fees paid by the Fund are reduced on assets invested in the K2 Subsidiary, in an amount equal to the management fees paid by the K2 Subsidiary.

Under each subadvisory agreement, the below entities provide subadvisory services to the Fund or K2 Subsidiary. The subadvisory fees are paid by K2 Advisors and are not an additional expense of the Fund or K2 Subsidiary. Each subadvisor is compensated for managing its respective portion of the average daily net assets of the Fund or K2 Subsidiary.

	Subadvisors
	ActusRayPartners Limited
	Apollo Credit Management LLC
	Bardin Hill Arbitrage IC Management LP
	Capital Fund Management S.A.
	Electron Capital Partners, LLC
	Franklin Advisers, Inc. *
	Graham Capital Management, L.P.
	Jennison Associates, LLC
	Lazard Asset Management, LLC
	​RBC Global Asset Management (UK) Limited (formerly, BlueBay Asset Management LLP)

* Effective June 3, 2024. An affiliate of K2 Advisors.

b. Administrative Fees

Under an agreement with K2 Advisors, FT Services provides administrative services to the Fund and K2 Subsidiary. The fee is paid by K2 Advisors based on the Fund’s and K2 Subsidiary’s average daily net assets, and is not an additional expense of the Fund or K2 Subsidiary.

c. Distribution Fees

The Board has adopted distribution plans for each share class, with the exception of Class R6 and Advisor Class shares, pursuant to Rule 12b-1 under the 1940 Act. Under the Fund’s Class A reimbursement distribution plan, the Fund reimburses Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to the maximum annual plan rate. Under the Class A reimbursement distribution plan, costs exceeding the maximum for the current plan year cannot be reimbursed in subsequent periods. In addition, under the Fund’s Class C and R compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to the maximum annual plan rate for each class. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.

The maximum annual plan rates, based on the average daily net assets, for each class, are as follows:

	Class A			0.30%
	Class C			1.00%
	Class R			0.50%

The Board has set the current rate at 0.25% per year for Class A shares until further notice and approval by the Board.

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

3. Tansactions with Affiliates (continued)

d. Sales Charges/Underwriting Agreements

Front-end sales charges and contingent deferred sales charges (CDSC) do not represent expenses of the Fund. These charges are deducted from the proceeds of sales of Fund shares prior to investment or from redemption proceeds prior to remittance, as applicable. Distributors has advised the Fund of the following commission transactions related to the sales and redemptions of the Fund’s shares for the year:

	Sales charges retained net of commissions paid to unaffiliated brokers/dealers			$1,755
	CDSC retained			$1,498

e. Transfer Agent Fees

Each class of shares pays 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 Fund 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, each class reimburses Investor Services for out of pocket expenses incurred and, except for Class R6, reimburses shareholder servicing fees paid to third parties. These fees paid to third parties are accrued and allocated daily based upon their relative proportion of such classes' aggregate net assets. Class R6 pays Investor Services transfer agent fees allocated specifically to that class based upon its relative assets and relative transactions.

For the year ended May 31, 2024, the Fund paid transfer agent fees as noted in the Consolidated Statement of Operations, of which $188,896 was retained by Investor Services.

f. Investments in Affiliated Management Investment Companies

The Fund invests 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 Fund does not invest for purposes of exercising a controlling influence over the management or policies. Management fees paid by the Fund are waived on assets invested in the affiliated management investment companies, as noted in the Consolidated Statement of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by each affiliate. During the year ended May 31, 2024, the Fund held investments in affiliated management investment companies as follows:

				Value at Beginning of Year			Purchases			Sales			Realized Gain (Loss)			Net Change in Unrealized Appreciation (Depreciation)			Value at End of Year			Number of Shares Held at End of Year			Income From Securities Loaned
	Non-Controlled Affiliates Institutional Fiduciary Trust Money Market Portfolio, 5.00% .			$3,348,000			$27,035,000			$(29,501,000)			$ —			$ —			$882,000			882,000			$71,975

g. Waiver and Expense Reimbursements

K2 Advisors has contractually agreed in advance to waive or limit its fees and to assume as their own expense certain expenses otherwise payable by the Fund so that the operating expenses (excluding interest expense, distribution fees, acquired fund fees and expenses, expenses related to securities sold short and certain non-routine expenses or costs, including those relating to litigation, indemnification, reorganizations and liquidations) for each class of the Fund do not exceed 1.70% based on the average net assets of each class until September 30, 2025. Total expenses waived or paid are not subject to recapture subsequent to the Fund’s fiscal year end.

Prior to March 1, 2024, the expenses (excluding certain fees and expenses as previously disclosed) for each class of the Fund were limited to 1.90% based on the average net assets of each class.

Prior to July 1, 2023, the expenses (excluding certain fees and expenses as previously disclosed) for each class of the Fund were limited to 1.95% based on the average net assets of each class.

Transfer agent fees on Class R6 shares of the Fund have been capped so that transfer agent fees for that class do not exceed 0.03% based on the average net assets of the class until September 30, 2025.

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

4. Expense Offset Arrangement

The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the year ended May 31, 2024, the custodian fees were reduced as noted in the Consolidated Statement of Operations.

5. Income Taxes

For tax purposes, capital losses may be carried over to offset future capital gains. During the year ended May 31, 2024, the Fund utilized $17,458,177 of capital loss carryforwards.

The tax character of distributions paid during the years ended May 31, 2024 and 2023, was as follows:

				2024			2023
	Distributions paid from:
	Ordinary income. . . . . . . . . . . . . . . . . .			$4,502,633			$ 21,007,267
	Long term capital gain. . . . . . . . . . . . . .			​—			8,295,038
	Total distributions paid. . . . . . . . . . . . . . .			$4,502,633			$29,302,305

At May 31, 2024, the cost of investments, net unrealized appreciation (depreciation), undistributed ordinary income and undistributed long term capital gain for income tax purposes were as follows:

	Cost of investments . . . . . . . . . . . . . . . . . . . . . .			$461,263,345
	Unrealized appreciation. . . . . . . . . . . . . . . . . . . .			$​47,400,951
	Unrealized depreciation. . . . . . . . . . . . . . . . . . . .			​(50,378,350)
	Net unrealized appreciation (depreciation) . . . . . . .			$​(2,977,399)
	Distributable earnings
	Undistributed ordinary income			$​30,314,745
	Undistributed long term capital gain			​—
	Total distributable earnings			$​30,314,745

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatments of derivative financial instruments, foreign currency transactions, wash sales and investments in the K2 Subsidiary.

6. Investment Transactions

Purchases and sales of investments and securities sold short (excluding short term securities) for the year ended May 31, 2024, aggregated $1,372,522,000 and $1,666,432,856, respectively.

At May 31, 2024, in connection with securities lending transactions, the Fund loaned equity investments and corporate bonds and notes and received $882,000 of cash collateral. The gross amounts of recognized liability for such transactions are included in payable upon return of securities loaned in the Consolidated Statement of Assets and Liabilities. The agreements can be terminated at any time.

7. Credit Risk and Defaulted Securities

At May 31, 2024, the Fund had 19.8% of its portfolio invested in high yield, senior secured floating rate loans, or other securities rated below investment grade 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.

The Fund may purchase the pre-default or defaulted debt of distressed companies. Distressed companies are financially troubled and could be or are already involved in financial restructuring or bankruptcy. Risks associated with purchasing these securities include the possibility that the bankruptcy or other restructuring process takes longer than expected, or that distributions in restructuring are less than anticipated, either or both of which may result in unfavorable consequences to the Fund. If it becomes probable that the income on debt securities, including those of distressed companies, will not be collected, the Fund discontinues accruing income and recognizes an adjustment for uncollectible interest.

At May 31, 2024, the aggregate long value of distressed company securities for which interest recognition has been discontinued was $4,561,020, representing 0.7% of the Fund’s net assets. For information as to specific securities, see the accompanying Consolidated Schedule of Investments.

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

8. Concentration of Risk

Investments in issuers domiciled or with significant operations in developing or emerging market countries may be subject to higher risks than investments in developed countries. These risks include fluctuating currency values, underdeveloped legal or business systems, and changing local and regional economic, political and social conditions, which may result in greater market volatility. In addition, certain foreign securities may not be as liquid as U.S. securities. Currencies of developing or emerging market countries may be subject to significantly greater risks than currencies of developed countries, including the potential inability to repatriate those currencies into U.S. dollars.

9. Investments in Russian Securities

Russia’s military invasion of Ukraine in February 2022, the resulting responses by the United States and other countries, and the potential for wider conflict could increase volatility and uncertainty in the financial markets and adversely affect regional and global economies. The United States and other countries have imposed broad-ranging economic sanctions on Russia and certain Russian individuals, banking entities and corporations as a response to its invasion of Ukraine. The United States and other countries have also imposed economic sanctions on Belarus and may impose sanctions on other countries that support Russia’s military invasion. These sanctions, as well as any other economic consequences related to the invasion, such as additional sanctions, boycotts or changes in consumer or purchaser preferences or cyberattacks on governments, companies or individuals, may further decrease the value and liquidity of certain Russian securities and securities of issuers in other countries that are subject to economic sanctions related to the invasion. To the extent that the Fund has exposure to Russian investments or investments in countries affected by the invasion, the Fund’s ability to price, buy, sell, receive or deliver such investments was impaired. The Fund could determine at any time that certain of the most affected securities have little or no value. In addition, any exposure that the Fund may have to counterparties in Russia or in countries affected by the invasion could negatively impact the Fund’s portfolio. The extent and duration of Russia’s military actions and the repercussions of such actions (including any retaliatory actions or countermeasures that may be taken by those subject to sanctions) are impossible to predict, but could result in significant market disruptions, including in the oil and natural gas markets, and may negatively affect global supply chains, inflation and global growth. These and any related events could significantly impact the Fund’s performance and the value of an investment in the Fund, even beyond any direct exposure the Fund may have to Russian issuers or issuers in other countries affected by the invasion. The Valuation Committee determined that based on their analysis of the market and access to market participants, the Russian financial instruments held by the Fund had little or no value at May 31, 2024.

10. Unfunded Loan Commitments

The Fund enters into certain credit agreements, all or a portion of which may be unfunded. The Fund is obligated to fund these loan commitments at the borrowers’ discretion. Unfunded loan commitments and funded portions of credit agreements are marked to market daily and any unrealized appreciation or depreciation is included in the Consolidated Statement of Assets and Liabilities and the Consolidated Statement of Operations. Funded portions of credit agreements are presented in the Consolidated Schedule of Investments.

At May 31, 2024, unfunded commitments were as follows:

	Borrower			Unfunded Commitment
	Altice USA Inc., Term Loan B			$119,689
	Bausch Health Cos. Inc., Term Loan B			241,757
	CommScope Holding Company Inc., Initial Term Loan			50,205
	CSC Holdings LLC, Term Loan B			1,264,737
	Curia Global Inc., First Lien Term Loan			215,284
	First Brands Group LLC, First Lien Term Loan			111,347
	First Brands Group LLC, First Lien Term Loan			357,843
	Forward Air Corp., Term Loan B			575,336
	Hercules Achievement Inc., Initial Term Loan			10,191
	H-Food Holdings LLC, Incremental Term Loan B-3			33,240
	H-Food Holdings LLC, Initial Term Loan			135,464
	H-Food Holdings LLC, Initial Term Loan			341,177
	H-Food Holdings LLC, Initial Term Loan			740,827
	K. Hovnanian Enterprises Inc., Term Loan RC			500,000
	Oldcastle BuildingEnvelope Inc., Term Loan RC			247,158
	Peloton Interactive Inc., Initial Term Loan			500,000
	Petco Health & Wellness Co. Inc., First Lien Term Loan			29,453
	Radiate Holdco LLC, Amendment No. 6 New Term Loan			396,000
	Steinhoff International Holdings NV, Facility B1			163,495
	Upfield Group BV, Term Loan RC			341,246
				$6,374,450

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

11. Other Derivative Information

At May 31, 2024, the investments in derivative contracts are reflected in the Consolidated Statement of Assets and Liabilities as follows:

Derivative Contracts Not Accounted for as Hedging Instruments

Asset Derivatives

Liability Derivatives

Consolidated Statement of Assets and Liabilities Location

Fair Value

Consolidated Statement of Assets and Liabilities Location

Fair Value

Interest rate contracts

Variation margin on futures contracts

$719,243a

Variation margin on futures contracts

$913,933a

Unrealized appreciation on OTC swap contracts

28,002

Unrealized depreciation on OTC swap contracts

77,581

Variation margin on centrally cleared swap contracts

292,379a

Variation margin on centrally cleared swap contracts

499,062a

Foreign exchange contracts

Variation margin on futures contracts

586,888a

Variation margin on futures contracts

538,687a

Unrealized appreciation on OTC swap contracts

231,206

Unrealized appreciation on OTC forward exchange contracts

2,227,550

Unrealized depreciation on OTC forward exchange contracts

868,001

Credit contracts

Variation margin on centrally cleared swap contracts

58,100a

Variation margin on centrally cleared swap contracts

631,346a

OTC swap contracts (upfront payments)

534,541

OTC swap contracts (upfront receipts)

658,440

Unrealized appreciation on OTC swap contracts

44,045

Unrealized depreciation on OTC swap contracts

290,045

Equity contracts

Investments in securities, at value

492,342b

Options written, at value

653,981

Variation margin on futures contracts

1,390,024a

Variation margin on futures contracts

778,474a

Unrealized appreciation on OTC swap contracts

​23,675,995

Unrealized depreciation on OTC swap contracts

​16,481,548

Commodity contracts

Variation margin on futures contracts

1,643,001a

Variation margin on futures contracts

2,720,196a

Totals

$31,923,316

$25,111,294

a This amount reflects the cumulative appreciation (depreciation) of futures contracts and centrally cleared swap contracts as reported in the Consolidated Schedule of Investments. Only the variation margin receivable/payable at year end is separately reported within the Consolidated Statement of Assets and Liabilities. Prior variation margin movements were recorded to cash upon receipt or payment.

b Purchased option contracts are included in investments in securities, at value in the Consolidated Statement of Assets and Liabilities.

For the year ended May 31, 2024, the effect of derivative contracts in the Consolidated Statement of Operations was as follows:

Derivative Contracts Not Accounted for as Hedging Instruments

Consolidated Statement of Operations Location

Net Realized Gain (Loss) for the Year

Consolidated Statement of Operations Location

Net Change in Unrealized Appreciation (Depreciation) for the Year

Net realized gain (loss) from:

Net change in unrealized appreciation (depreciation) on:

Interest rate contracts

Investments

$​291,361a

Investments

$(108,550)a

Written options-

(177,676)

Written options

114,123

Futures contracts

​1,708,493

Futures contracts

400,262

Swap contracts

​5,056,486

Swap contracts

​(762,070)

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

11. Other Derivative Information (continued)

Derivative Contracts Not Accounted for as Hedging Instruments

Consolidated Statement of Operations Location

Net Realized Gain (Loss) for the Year

Consolidated Statement of Operations Location

Net Change in Unrealized Appreciation (Depreciation) for the Year

Foreign exchange contracts

Investments

​$(196,217)a

Investments

$125,031a

Written options

​10,334

Written options

(7,640)

Forward exchange contracts

​(5,152,376)

Forward exchange contracts

2,994,307

Futures contracts

​210,838

Futures contracts

(78,500)

Swap contracts

(54,629)

Swap contracts

231,206

Credit contracts

Swap contracts

(1,211,333)

Swap contracts

(1,117,784)

Equity contracts

Investments

​(5,541,161)a

Investments

746,688a

Written options

​1,322,975

Written options

(835,771)

Futures contracts

​1,560,408

Futures contracts

1,138,393

Swap contracts

​(4,115,368)

Swap contracts

​11,561,145

Commodity contracts

Futures contracts

​(1,948,058)

Futures contracts

(2,279,442)

Totals

$(8,235,923)

$12,121,399

a Purchased option contracts are included in net realized gain (loss) from investments and net change in unrealized appreciation (depreciation) on investments in the Consolidated Statement of Operations.

For the year ended May 31, 2024, the average month end notional amount of futures contracts and swap contracts represented $692,832,557 and $588,859,766, respectively. The average month end fair value of options was $2,815,998. The average month end contract value of forward exchange contracts was $480,493,644.

At May 31, 2024, OTC derivative assets and liabilities are as follows:

				Gross Amounts of Assets and Liabilities Presented in the Consolidated Statement of Assets and Liabilities
				Assetsa			Liabilitiesa
	Forward Exchange Contracts			$2,227,550			$868,001
	Swap Contracts			​24,513,789			​17,507,614
	Total			$26,741,339			$18,375,615

a Absent an event of default or early termination, OTC derivative assets and liabilities are presented gross and not offset in the Consolidated Statement of Assets and Liabilities.

At May 31, 2024, OTC derivative assets, which may be offset against OTC derivative liabilities and collateral received from the counterparty, are as follows:

				Gross Amounts of Assets Presented in the Consolidated Statement of Assets and Liabilities			Amounts Not Offset in the Consolidated Statement of Assets and Liabilities									Net Amount (Not less than zero)
							Financial Instruments Available for Offset			Financial Instruments Collateral Receiveda			Cash Collateral Received
	Counterparty
	BNPP			$90,358			$(33,942)			$—			$  —			$56,416
	BNYM			8,391			(4,125)			—			—			4,266
	BOFA			55,494			(13,598)			—			—			41,896
	BZWS			460,188			(197,618)			—			—			262,570
	CITI			​430,523			(185,827)			—			—			​244,696
	DBAB			695,157			(145)			—			—			695,012
	GSCO			352,810			(352,810)			—			—			—
	HSBC			16,402			(16,402)			—			—			—

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

11. Other Derivative Information (continued)

				Gross Amounts of Assets Presented in the Consolidated Statement of Assets and Liabilities			Amounts Not Offset in the Consolidated Statement of Assets and Liabilities									Net Amount (Not less than zero)
							Financial Instruments Available for Offset			Financial Instruments Collateral Receiveda			Cash Collateral Received
	JPHQ			$​7,923,997			$​(4,597,924)			$(60,661)			$—			$3,265,412
	JPHQb			​48,979			—			—			—			​48,979
	MLCO			—			—			—			—			—
	MSCO			​1,054,843			​(940,615)			—			—			​114,228
	MSCOb			3,979			—			—			—			3,979
	MSCOc			1,202,773			(442,547)			—			—			760,226
	MSCS			8,985,135			(7,354,832)			—			—			1,630,303
	SEBA			5,350,021			(3,746,957)			—			—			1,603,064
	SSBT			8,308			(8,308)			—			—			—
	UBSW			53,981			(20,897)			—			—			33,084
	Total			$ 26,741,339			​$(17,916,547)			$(60,661)			$—			​$8,764,131

At May 31, 2024, OTC derivative liabilities, which may be offset against OTC derivative assets and collateral pledged to the counterparty, are as follows:

				Gross Amounts of Liabilities Presented in the Consolidated Statement of Assets and Liabilities			Amounts Not Offset in the Consolidated Statement of Assets and Liabilities									Net Amount (Not less than zero)
							Financial Instruments Available for Offset			Financial Instruments Collateral Pledgeda			Cash Collateral Pledgeda
	Counterparty
	BNPP			$33,942			$(33,942)			$  —			$—			$—
	BNYM			4,125			(4,125)			—			—			—
	BOFA			13,598			(13,598)			—			—			—
	BZWS			197,618			(197,618)			—			—			—
	CITI			185,827			(185,827)			—			—			—
	DBAB			145			(145)			—			—			—
	GSCO			670,009			(352,810)			—			(317,199)			—
	HSBC			68,108			(16,402)			—			—			51,706
	JPHQ			​4,597,924			​(4,597,924)			—			—			—
	JPHQb			​47,493			—			—			—			​47,493
	MLCO			33,843			—			—			—			33,843
	MSCO			​940,615			​940,615			—			—			—
	MSCOb			​5,517			—			—			—			​5,517
	MSCOc			442,547			(442,547)			—			—			—
	MSCS			7,354,832			(7,354,832)			—			—			—
	SEBA			3,746,957			(3,746,957)			—			—			—
	SSBT			11,618			(8,308)			—			—			3,310
	UBSW			20,897			(20,897)			—			—			—
	Total			​$ 18,375,615			​$(17,916,547)			$—			$(317,199)			​$141,869

a In some instances, the collateral amounts disclosed in the table above were adjusted due to the requirement to limit the collateral amounts to avoid the effect of over collateralization. Actual collateral received and/or pledged may be more than the amounts disclosed herein.

b Represents derivatives not subject to an ISDA master agreement.

c Represents derivatives owned by the K2 Holdings Investment Corp., a wholly-owned subsidiary of the Fund. See Note 1(g).

See Note 1(d) regarding derivative financial instruments.

See Abbreviations on page 90.

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

12. Credit Facility

The Fund, 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 Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its 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 Consolidated Statement of Operations. During the year ended May 31, 2024, the Fund did not use the Global Credit Facility.

13. Fair Value Measurements

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s 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 Fund’s 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 May 31, 2024, in valuing the Fund’s assets and liabilities carried at fair value, is as follows:

				Level 1			Level 2			Level 3			Total
	Assets:
	Investments in Securities:a
	Equity Investmentsb			$124,495,087			$​4,493,334			$122,017e			$​129,110,438
	Convertible Bonds			—			74,032,939			94,384			74,127,323
	Convertible Bonds in Reorganization			—			99,680			8,653			108,333
	Corporate Bonds and Notes			—			​32,029,250			​1,154,496			​33,183,746
	Corporate Bonds and Notes in Reorganization			—			​587,971			​202,730			​790,701
	Senior Floating Rate Interests			—			​9,438,761			​28,686			9,467,447
	Foreign Government and Agency Securities			—			11,477,128			—			11,477,128
	Foreign Government and Agency Securities in Reorganization			—			​3,661,986			—			​3,661,986
	U.S. Government and Agency Securities			—			9,658,515			—			9,658,515
	Options Purchased			​492,342			​—			—			492,342
	Short Term Investments			220,574,596			66,171,455			—			286,746,051
	Total Investments in Securities			$345,562,025			$211,651,019c			$1,610,966			$558,824,010
	Other Financial Instruments:
	Futures Contracts			$4,260,868			$—			$—			$4,260,868
	Forward Exchange Contracts			—			2,227,550			—			2,227,550
	Swap Contracts			​—			24,329,727			—			24,329,727
	Unfunded Loan Commitments			—			—			7,708f			7,708
	Total Other Financial Instruments			$4,260,868			$26,557,277			$​7,708			$​30,825,853
	Liabilities:
	Other Financial Instruments:
	Options Written			$653,981			$—			$—			$653,981
	Securities Sold Shorta			​74,719,836			​30,421,537d			—e			105,141,373
	Futures Contracts			4,873,002			—			—			4,873,002
	Forward Exchange Contracts			—			868,001			—			868,001
	Swap Contracts			—			17,979,582			—e			17,979,582
	Unfunded Loan Commitments			—			​43,261			—			​43,261
	Total Other Financial Instruments			$​80,246,819			$​49,312,381			$—			$129,559,200

a For detailed categories, see the accompanying Consolidated Schedule of Investments.

b Includes common stocks, investment companies and preferred stocks as well as other equity interests.

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

13. Fair Value Measurements (continued)

c Includes foreign securities valued at $4,132,281, 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.

d Includes foreign securities valued at $554,612, 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.

e Includes financial instruments determined to have no value.

f Included in unrealized depreciation on unfunded loan commitments in the Consolidated Statement of Assets and Liabilities.

A reconciliation in which Level 3 inputs are used in determining fair value is presented when there are significant Level 3 assets and/or liabilities at the beginning and/or end of the year.

14. New Accounting Pronouncements

In March 2020, the FASB issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting. In January 2021 and December 2022, the FASB issued ASU No. 2021-01 and ASU No. 2022-06, with further amendments to Topic 848. The amendments in the ASUs provide optional temporary accounting recognition and financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the LIBOR and other interbank-offered based reference rates as of the end of 2021 for certain LIBOR settings and 2023 for the remainder. The ASUs are effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2024. Management has reviewed the requirements and believes the adoption of these ASUs will not have a material impact on the financial statements.

15. Subsequent Events

The Fund has evaluated subsequent events through the issuance of the consolidated financial statements and determined that no events have occurred that require disclosure other than those already disclosed in the consolidated financial statements.

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

K2 Alternative Strategies Fund (continued)

Abbreviations

Counterparty

Currency

Selected Portfolio

​BNPP

​BNP Paribas

BRL

Brazilian Real

ADR

American Depositary Receipt

BNYM

​The Bank of New York Mellon Corp.

CAD

Canadian Dollar

ASX

Australian Securities Exchange

​BOFA

​Bank of America, NA

CHF

Swiss Franc

BRLCDI

Brazil Cetip Di Interbank Deposit Rate

​BZWS

​Barclays Bank PLC

COP

Colombian Peso

BUBOR

Budapest Interbank Offered Rate

​CITI

​Citigroup, NA

CZK

Czech Koruna

CAC

Cotation Assistee en Continu

​DBAB

​Deutsche Bank, AG

DKK

Danish Krone

CBOE

Chicago Board Options Exchange

​GSCO

​Goldman Sachs International

DOP

Dominican Peso

CIBOR

Copenhagen Interbank Offered Rate

​HSBC

​HSBC Bank PLC

EGP

Egyptian Pound

DAX

Deutscher Aktienindex

​JPHQ

​JP Morgan Chase Bank, NA

EUR

Euro

DJIA

Dow Jones Industrial Average

​MLCO

​Merrill Lynch & Co., Inc.

GBP

British Pound

EONIA

Euro OverNight Index Average

​MSCO

​Morgan Stanley & Co. LLC

HKD

Hong Kong Dollar

ETF

Exchange Traded Fund

​MSCS

​Morgan Stanley Capital Services LLC

HUF

Hungarian Forint

EURIBOR

Euro Interbank Offered Rate

​SEBA

​Skandinaviska Enskilda Banken AB

IDR

Indonesian Rupiah

FEDEF

Federal Funds Effective Rate

​SSBT

​State Street Bank and Trust Company

JPY

Japanese Yen

FHLMC

Federal Home Loan Mortgage Corp.

​UBSW

​UBS AG

MXN

Mexican Peso

FNMA

Federal National Mortgage Association

NOK

Norwegian Krone

FRN

Floating Rate Note

PEN

Peruvian Nuevo Sol

FTSE

Financial Times Stock Exchange

PLN

Polish Zloty

HIBOR

Hong Kong Interbank Offered Rate

PYG

Paraguay Guarani

IBEX

Iberian Index

RSD

Serbian Dinar

JIBAR

Johannesburg Interbank Agreed Rate

SEK

Swedish Krona

JSE

Johannesburg Stock Exchange Index

TRY

Turkish Lira

KOSPI

Korean Composite Stock Price Index

​USD

United States Dollar

LIBOR

London InterBank Offered Rate

UYU

Uruguayan Peso

MIB

Milano Italia Borsa

ZAR

South African Rand

MUTSCALM

Japan Unsecured Overnight Call Rate

Index

NIBOR

Norwegian Interbank Offered Rate

CDX.EM

CDX Emerging Markets Index

OAT

Obligation Assumable by the Treasurer

CDX.NA.HY

CDX North America High Yield Index

PIK

Payment In-Kind

CDX.NA.IG

CDX North America Investment

RC

Revolving Loan Commitment

Grade Index

REIT

Real Estate Investment Trust

ITRX.EUR

iTraxx Europe Index

SABOR

South African Benchmark Overnight Rate

ITRX.EUR.XOVER

iTraxx Europe Crossover Index

SARON

Swiss Average Rate Overnight

SOFR

Secured Overnight Financing Rate

SONIA

Sterling Overnight Index Average

SPDR

Standard & Poor's Depositary Receipt

SPI

Swiss Performance Index

STIBOR

Stockholm Interbank Offered Rate

STR

Short Term Rate

TOPIX

Tokyo Price Index

TSX

Toronto Stock Exchange

The following reference rates, and their values as of period end, are used for security descriptions:

	Reference Index			Reference Rate
	11-Day EONIA			4.00%
	1-Day FEDEF			5.33
	1-Day MUTSCALM			0.08
	1-Day SABOR			8.21
	1-Day SARON			1.45
	1-Day SONIA			5.20
	1-Month EURIBOR			3.72
	1-Month HIBOR			4.47
	1-Week CIBOR			3.67
	1-Week NIBOR			4.54
	1-Week STIBOR			3.76
	3-Month JIBAR			8.34
	6 month BUBOR			6.95
	Banxico Mexico 1 Month Rate			11.25
	BRLCDI			10.40
	Euro STR			3.89
	SOFR			5.34

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

Report of Independent Registered Public Accounting Firm

To the Board of Trustees of Franklin Alternative Strategies Funds and Shareholders of K2 Alternative Strategies Fund:

Opinion on the Financial Statements

We have audited the accompanying consolidated statement of assets and liabilities of K2 Alternative Strategies Fund (the “Fund”) (the sole fund constituting Franklin Alternative Strategies Funds (the “Trust”)), including the consolidated schedule of investments, as of May 31, 2024, and the related consolidated statement of operations for the year then ended, the consolidated statements of changes in net assets for each of the two years in the period then ended, the consolidated financial highlights for each of the five years in the period then ended and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the consolidated financial position of the Fund (the sole fund constituting Franklin Alternative Strategies Funds) at May 31, 2024, the consolidated results of its operations for the year then ended, the consolidated changes in its net assets for each of the two years in the period then ended and its consolidated financial highlights for each of the five years in the period then ended, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These financial statements are the responsibility of the Trust’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Trust is not required to have, nor were we engaged to perform, an audit of the Trust’s internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Trust’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of May 31, 2024, by correspondence with the custodian, brokers and others; when replies were not received from brokers and others, we performed other auditing procedures. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

 

We have served as the auditor of one or more Franklin investment companies since 1987.

Boston, Massachusetts

July 23, 2024

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

K2 ALTERNATIVE STRATEGIES FUND

Tax Information (unaudited)

By mid-February, tax information related to a shareholder’s proportionate share of distributions paid during the preceding calendar year will be received, if applicable. Please also refer to www.franklintempleton.com for per share tax information related to any distributions paid during the preceding calendar year. Shareholders are advised to consult with their tax advisors for further information on the treatment of these amounts on their tax returns.

The following tax information for the Fund is required to be furnished to shareholders with respect to income earned and distributions paid during its fiscal year.

The Fund hereby reports the following amounts, or if subsequently determined to be different, the maximum allowable amounts, for the fiscal year ended May 31, 2024:

				Pursuant to:			Amount Reported
	Dividends Received Deduction (DRD)			§854(b)(1)(A)			$1,398,678
	Qualified Dividend Income (QDI)			§854(b)(1)(B)			$1,817,669

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FRANKLIN ALTERNATIVE STRATEGIES FUNDS

Changes In and Disagreements with AccountantsFor the period covered by this report

Not applicable.

Results of Meetings of ShareholdersFor the period covered by this report

Not applicable.

Remuneration Paid to Directors, Officers and OthersFor the period covered by this report

Refer to the financial statements included herein.

Board Approval of Management and Subadvisory AgreementsFor the period covered by this report

 

Agreements and Sub-Advisory Agreements

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

K2 Alternative Strategies Fund

(Fund)

The Board of Trustees (Board) of Franklin Alternative Strategies Funds (the Trust), including a majority of trustees that are not “interested persons” as such term is defined in section 2(a)(19) of the Investment Company Act of 1940 (hereinafter referred to as “independent trustees”), at an in person meeting held on May 21, 2024, unanimously approved the renewal of the Fund’s investment management agreement with K2/D&S Management Co., L.L.C. (K2 Advisors), and renewal/approval of each sub-advisory agreement between

K2 Advisors and each of the following sub-advisors (the Sub-Advisors):

ActusRayPartners Limited

Apollo Credit Management, LLC

Bardin Hill Arbitrage IC Management LP

Capital Fund Management SA

Electron Capital Partners, LLC

Graham Capital Management, L.P.

Jennison Associates LLC

Lazard Asset Management LLC

RBC Global Asset Management (UK) Limited

Franklin Advisers, Inc. (FAV)

Prior to a meeting of all of the trustees for the purpose of considering such renewal, the independent trustees participated in two other meetings held in connection with the renewal process. Throughout the process, the independent trustees received assistance and advice from and met separately with independent counsel. The independent trustees met with and interviewed officers of K2 Advisors and representatives of certain Sub-Advisors (including portfolio managers), the transfer agent and shareholder services group and the distributor. In approving the renewal of the investment management agreement and the renewal/approval of the sub-advisory agreements for the Fund, the Board, including the independent trustees, determined that the investment management fee structure was fair and reasonable and that continuance of the agreements was in the best interests of the Fund and its shareholders.

As part of the approval process, the Board considered the process undertaken and information provided during its consideration and approval on February 27, 2024 of the amendment to the investment management agreement with K2 Advisors and the amendment to the schedule to the fee

waiver and/or expense reimbursement agreement with K2 Advisors. Such amendments reduced (i) the investment management fees from 1.90% to 1.70% for the initial investment management fee rate (and with corresponding 0.20% decreases for each breakpoint in the investment management fee schedule), and (ii) the cap in the fee waiver and expense limitation arrangement from 1.90% to 1.70%, effective as of March 1, 2024, respectively. These amendments were designed to enable the Fund to continue to be competitive with its peers and to be better positioned for potential asset growth, as well as take into account the enhancements to the investment strategy that were implemented in the first quarter of 2024. The Board noted that the nature and quality of the overall services provided, and to be provided, by K2 Advisors as a result of the amendments would not be negatively affected. At the February 27, 2024 meeting, the Board determined that, after consideration of the factors discussed and presented, the services provided were reasonable in relation to the fees to be paid under the investment management agreement plus any benefits that may accrue to K2 Advisors, that the fees and benefits were within the range of what could have been negotiated at arms-length for these services, and that the terms of the investment management agreement, as amended, were fair and reasonable.

In making the foregoing approvals, the Board considered various materials related to the investment management agreement and the sub-advisory agreements including: (1) a copy of the investment management agreement and sub-advisory agreements; (2) information describing the nature, quality and extent of services that K2 Advisors and each Sub-Advisor provided, and/or are expected to provide, to the Fund, and the investment management fees and sub-advisory fees payable to K2 Advisors and each Sub-Advisor; (3) reports from K2 Advisors on the continued diligence conducted on each Sub-Advisor and the reasons for recommending renewal/approval of each of the sub-advisory agreements, including, but not limited to, each Sub-Advisor’s background, experience, personnel, operations, policies, procedures and compliance functions; and (4) a report from the Trust’s Chief Compliance Officer regarding K2 Advisors’ and each Sub-Advisor’s compliance program and capabilities, including policies and procedures in place to address potential conflicts of interest, and the diligence undertaken by the Trust’s Chief Compliance Officer with respect thereto. The Board also reviewed and considered an annual report on payments made by Franklin Templeton (FT) or the Fund to financial intermediaries, as well as a memorandum relating to

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third-party servicing arrangements. The Board acknowledged the ongoing integration of the Putnam family of funds into the FT family of funds and management’s continued development of strategies to address areas of heightened concern in the mutual fund industry, including various regulatory initiatives and continuing geopolitical concerns.

The Board also took into account information furnished throughout the year at Board meetings, as well as information specifically requested and furnished for the renewal process, which culminated in the meetings referred to above for the specific purpose of considering such agreements. Information furnished throughout the year included, among others, reports on the Fund’s investment performance, expenses, portfolio composition, derivatives, portfolio turnover, Rule 12b-1 plan, distribution, shareholder servicing, legal and compliance matters, pricing of securities, sales and redemptions, and marketing support payments made to financial intermediaries, as well as a third-party survey of transfer agent fees charged to funds within the FT complex in comparison to those charged to other fund complexes deemed comparable. Also, related financial statements and other information about the scope and quality of services provided by K2 Advisors and its affiliates and enhancements to such services over the past year were provided. In addition, the trustees received periodic reports throughout the year and during the renewal process relating to compliance with the Fund’s investment policies and restrictions. During the renewal process, the independent trustees considered K2 Advisors’ methods of operation within the FT group and its activities on behalf of other clients.

The information obtained by the trustees during the renewal process also included a special report prepared by Broadridge Financial Solutions, Inc., an independent third-party analyst that utilizes data from Lipper, Inc. (Lipper), comparing the Fund’s investment performance and expenses with those of other mutual funds deemed comparable to such Fund as selected by Lipper (Broadridge Section 15(c) Report). The trustees reviewed the Broadridge Section 15(c) Report and its usefulness in the renewal process with respect to matters such as comparative fees, expenses, expense ratios and performance. The Board considered K2 Advisors’ views that the peer group determined by Lipper for comparison purposes may not be an entirely appropriate representation of the Fund’s peer universe. K2 Advisors explained that the universe of funds that are managed using multi-manager, multistrategy structures, like the Fund, continues to evolve, and has presented challenges in identifying an appropriate set of peers for the Fund. It was noted by K2 Advisors that the peer group compiled by Lipper includes single-manager funds which, due to their nature and relative simplicity, have lower expense ratios and are not true peers for fee comparison purposes (Base Expense Group). Because some of the sponsors of funds with multi-manager strategies that K2 Advisors considers to be peers were excluded from the peer group determined by Lipper, K2 Advisors requested a second peer group including funds that K2 Advisors considers to be peer funds (Alternate Expense Group) for the Board’s consideration. In addition, the Board noted that the Broadridge Section 15(c) Report did not reflect the changes to the Fund’s investment management fees and the cap in the fee waiver and expense limitation arrangement as the Lipper expense data is based upon

information taken from each fund’s most recent annual report and such changes were made after such date. While noting the limitations of the Broadridge Section 15(c) Report, the Board concluded that the Broadridge Section 15(c) Report was helpful in the performance of its duties and took into account the Alternate Expense Group as part of its considerations.

In addition, the trustees received a Profitability Study (Profitability Study) prepared by management discussing the profitability to FT from its overall U.S. fund operations, as well as on an individual fund-by-fund basis. Over the past year, the Board and counsel to the independent trustees continued to receive reports on management’s handling of recent regulatory inquiries and pending legal actions against K2 Advisors and its affiliates. The independent trustees were satisfied with the actions taken to date by management in response to such regulatory and legal matters. The independent trustees also received reports from the Trust’s Chief Compliance Officer on regulatory inquiries and pending legal actions against the Sub-Advisors applicable to the services provided/to be provided by the Sub-Advisors to the Fund and noted that there were not any issues in this regard that should prevent the renewal/approval of the sub-advisory agreements.

The trustees reviewed the personnel, operations, financial condition, and investment management capabilities, methodologies and resources of K2 Advisors and each Sub-Advisor, including each management team’s expertise in the management of other alternative strategies funds. As part of this review, particular attention was given to (1) the diligent risk management program of K2 Advisors and its parent, including those aspects of the program related to selecting and overseeing sub-advisors to the Fund and continual monitoring and management of cybersecurity, liquidity and counterparty credit risk, (2) each Sub-Advisor’s risk management program, and (3) derivatives and other complex instruments that are held and expected to be held by the Fund and how such instruments are used to carry out the Fund’s investment goal.

The Board also took into account, among other things, management’s efforts in establishing a global credit facility for the benefit of the Fund and other accounts managed by FT to provide a source of cash for temporary and emergency purposes or to meet unusual redemption requests as well as the strong financial position of K2 Advisors’ parent company and its commitment to the mutual fund business. The Board noted management’s continuing efforts and expenditures in establishing effective business continuity plans and developing strategies to address areas of heightened concern in the mutual fund industry, such as cybersecurity and liquidity risk management. The Board acknowledged management’s continued development of strategies to address areas of heightened concern in the mutual fund industry, including various regulatory initiatives and continuing geopolitical concerns. The Board also recognized management’s commitment to facilitating Board oversight of particular areas, including derivatives and payments to intermediaries, by enhanced reporting. In addition, the Board received updates from management on the compliance of the investment manager with comprehensive rules and regulations promulgated by the SEC and the U.S. Commodity Futures Trading Commission.

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In addition to the above and other matters considered by the trustees throughout the course of the year, the following discussion relates to certain primary factors relevant to the Board’s decision. This discussion of the information and factors considered by the Board (including the information and factors discussed above) is not intended to be exhaustive, but rather summarizes certain factors considered by the Board. In view of the wide variety of factors considered, the Board did not, unless otherwise noted, find it practicable to quantify or otherwise assign relative weights to the foregoing factors. In addition, individual trustees may have assigned different weights to various factors.

NATURE, EXTENT AND QUALITY OF SERVICES. The trustees reviewed the nature, extent and quality of the services provided, and/or to be provided, by K2 Advisors and each Sub-Advisor. In this regard, they reviewed the Fund’s investment goal and K2 Advisors’ and each Sub-Advisor’s investment strategy and sub-strategy, and K2 Advisors’ and each Sub-Advisor’s ability to implement such investment strategy and/or sub-strategy, including, but not limited to, K2 Advisors’ and each Sub-Advisor’s trading practices, investment decision processes and reputation. The Board also considered the investment management services that the investment manager and the Sub-Advisors (as applicable) provide to the Cayman Islands-based company, which is wholly owned by the Fund (Cayman Subsidiary).

The Board noted that the Fund employs a “manager of managers” structure, whereby K2 Advisors is responsible for selecting sub-advisors (subject to Board approval), principally allocating the Fund’s assets among them, and overseeing the sub-advisors’ day-to-day management of the Fund’s assets. The Board noted the responsibilities that K2 Advisors has as the Fund’s investment manager, including (1) due diligence on the Sub-Advisors and any potential new sub-advisors to the Fund, their respective trading strategies, risk management, operations and businesses, (2) on-going oversight and monitoring of the day-to-day investment activities of Sub-Advisors and other service providers, including their respective compliance with the investment mandate and restrictions, compliance policies and procedures and federal securities laws, and K2 Advisors’ ongoing assessment of their performance, (3) portfolio construction with respect to the allocation of assets among Sub-Advisors, investment funds, cash and other investments, (4) directly managing a portion of the Fund’s assets which are not allocated to Sub-Advisors, (5) risk management, (6) preparing quarterly reports to the Board, and (7) the implementation of Board directives as they relate to the Fund. The Trustees also considered the successful performance of K2 Advisors in managing the Fund and other investment products with similar investment strategies to the investment strategies of the Fund that are not subject to the Investment Company Act of 1940.

With respect to the sub-advisory services provided, and/or to be provided, by each Sub-Advisor, the Board noted the responsibilities that each Sub-Advisor has/will have with respect to the portion of the Fund’s assets allocated to the Sub-Advisor by K2 Advisors (Sub-Advised Portion), including, among others, implementing the investment strategies with respect to the Sub-Advised Portion and ensuring compliance with the investment strategies, policies and limitations of the

Sub-Advised Portion. The trustees considered the performance of each Sub-Advisor in managing the Fund (as applicable) and other investment products with similar investment strategies to the investment strategies of its Sub-Advised Portion of the Fund, including, with respect to certain Sub-Advisors, mutual funds with similar investment strategies. The Board considered K2 Advisors’ rationale for recommending the retention of each Sub-Advisor.

The trustees reviewed the Fund’s portfolio management teams at K2 Advisors and each Sub-Advisor, including each such team’s performance, staffing, skills and compensation program. With respect to portfolio manager compensation, management assured the trustees that the Fund’s long-term performance is a significant component of incentive-based compensation for K2 Advisors’ portfolio management team and noted that a portion of a K2 Advisors’ portfolio manager’s incentive-based compensation is paid in shares of pre-designated funds from the portfolio manager’s fund management area. The trustees noted that the portfolio manager compensation program aligned the interests of the portfolio managers with that of Fund shareholders. During regular Board meetings and the aforementioned meetings of the independent trustees, the trustees considered periodic reports provided to them showing that K2 Advisors and the Sub-Advisors complied with the investment policies and restrictions of the Fund as well as other reports periodically furnished to the Board covering matters such as the compliance of portfolio managers and other management personnel with the code of ethics covering the investment management personnel, the adherence to fair value pricing procedures established by the Board and the accuracy of net asset value calculations. The Board noted the extent of the benefits provided to Fund shareholders from being part of the FT group of funds, including the right to exchange investments between funds (same class) without a sales charge, the ability to reinvest Fund dividends into other funds and the right to combine holdings of other funds to obtain reduced sales charges. The Board specifically noted FT’s commitment to technological innovation and advancement, including its initiative to create a new enterprise-wide artificial intelligence platform.

The trustees discussed with management various other products, portfolios and entities that are advised by K2 Advisors and each Sub-Advisor and the allocation of assets and expenses among and within them, as well as their relative fees and reasons for differences with respect thereto and any potential conflicts.

The Board also considered a report from the Trust’s Chief Compliance Officer regarding K2 Advisors’ and each Sub-Advisor’s compliance program and capabilities as such programs and capabilities relate to the operations of the Fund and the monitoring and testing of such program undertaken by the Trust’s Chief Compliance Officer. The Board considered the selection and due diligence process employed by K2 Advisors in selecting and deciding to retain each Sub-Advisor as a sub-advisor to the Fund, including the due diligence undertaken with respect to the Sub-Advisor’s compliance and

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risk management capabilities. The trustees considered K2 Advisors’ significant efforts in developing and implementing compliance procedures established in accordance with SEC and other requirements.

The Board also considered the nature, extent and quality of the services to be provided under the Fund’s other service agreements to determine that, on an overall basis, Fund shareholders were well served. In this connection, the Board also took into account transfer agent and shareholder services provided to Fund shareholders by an affiliate of K2 Advisors, noting favorable periodic reports on shareholder services conducted by independent third parties. While such considerations directly affected the trustees’ decision in renewing the Fund’s transfer agent and shareholder services agreement, the Board also considered these commitments as incidental benefits to Fund shareholders deriving from the investment management relationship.

Based on their review, the trustees were satisfied with the nature and quality of the overall services provided, and/or to be provided, by K2 Advisors and its affiliates and each Sub Advisor to the Fund and its shareholders and were confident in the abilities of K2 Advisors and each Sub-Advisor to implement their respective investment strategy and/or sub-strategy and to provide quality services to the Fund and its shareholders.

INVESTMENT PERFORMANCE. The trustees reviewed the investment performance of the Fund for the one-, three-, five- and ten-year periods ended December 31, 2023.

As part of their review, they inquired of management regarding benchmark and hedging activities. Consideration was also given to performance in the context of available levels of cash, including as affected by net flows, during the periods. The trustees had meetings during the year, including the meetings referred to above held in connection with the renewal process, with the Fund’s portfolio managers to discuss performance and the management of the Fund and each Sub-Advisor.

In addition, attention in assessing performance was given to the Broadridge Section 15(c) Report. That report showed the investment performance of the Fund (Advisor Class shares) in comparison to other funds determined comparable by Lipper.

The comparable funds to the Fund, as chosen by Lipper, included all institutional alternative multi-strategy funds. The Fund had total returns in the middle performing quintile for the ten-year period, the second-lowest performing quintile for the one- and five-year periods ended December 31, 2023 and total returns in the lowest performing quintile for the three-year period ended December 31, 2023. The trustees also compared Fund performance to other industry benchmarks, including measures of risk-adjusted performance of a fund, as part of their evaluation of investment performance. The trustees discussed with management the reasons for the relative underperformance for the one-, three- and five-year periods ended December 31, 2023. In this regard, K2 Advisors informed the Board that, following a comprehensive review of the investment strategy of the Fund during 2023, K2 Advisors determined that enhancements to the investment strategy were warranted and implemented such enhancements in the first quarter of 2024. The Board took into account the recent performance of the Fund in light of the implementation of such

enhancements, noting that such performance was strong. While disappointed with the relative underperformance of the Fund with respect to performance periods ended December 31, 2023 (other than for the ten-year period), and in light of the recent enhancements to the Fund, the Board did not believe that any further changes with respect to the Fund were warranted at the time. The Board noted that it would continue to monitor future performance.

COMPARATIVE EXPENSES AND PROFITABILITY. The trustees considered the cost of the services provided, and/or to be provided, by K2 Advisors and each Sub-Advisor and the profits realized by K2 Advisors and its affiliates from their relationships with the Fund. As part of the renewal process, they explored with management the trends in expense ratios over the past three fiscal years and the reasons for any increases in the Fund’s expense ratios (or components thereof). In this regard, the trustees took into account the introduction in 2020 of breakpoints in the investment management fee schedule of the Fund, which were designed to better position the Fund for potential asset growth. In addition, and following on-going discussions with the independent trustees with respect to the investment management fees and expense ratio of the Fund, the trustees took into account the reduction earlier in the year in (i) the investment management fees from 1.90% to 1.70% for the initial investment management fee rate (and with corresponding 0.20% decreases for each breakpoint in the investment management fee schedule), and (ii) the cap in the fee waiver and expense limitation arrangement from 1.90% to 1.70%. In considering the appropriateness of the management fees and other expenses charged to the Fund, the Board took into account various factors including investment performance and matters relating to Fund operations, including, but not limited to, the quality and experience of K2 Advisors personnel. The Board also reviewed and considered the investment management fees in light of the nature, extent and quality of the investment management services provided, and/or to be provided, by K2 Advisors and each Sub-Advisor, as more fully discussed above. The Board also considered the changes negotiated by K2 Advisors in the sub-advisory fees charged by the Sub-Advisers, including the addition of breakpoints in the sub-advisory fee schedules of certain Sub-Advisors in the past few years. The Board noted that the sub-advisory fees are paid by K2 Advisors to each Sub-Advisor and are not additional fees borne by the Fund. The Board also noted that the sub-advisory fees paid, and/or to be paid, by K2 Advisors to each Sub-Advisor were the product of arms-length negotiations between K2 Advisors and each Sub-Advisor.

Furthermore, the Board took into account that information regarding Sub-Advisor profitability is not legally required to be provided. Accordingly, profitability information of the sub-advisors was given lesser weight than other factors. In addition, the Board considered the allocation of the investment management fees charged to the Fund between K2 Advisors and each Sub-Advisor in light of the nature, extent and quality of the investment management services provided, and/or to be provided, by K2 Advisors and each Sub-Advisor. As part of this discussion, the Board took into account the fee waiver and expense limitation arrangement in effect (as modified on the terms set forth above), and the amount of Fund expenses that were absorbed since inception of the Fund by K2 Advisors

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through such waivers and arrangements. The Board also considered the investment management services that the investment manager and the Sub-Advisors (as applicable) provide to the Cayman Subsidiary and the related fee waivers that are in place.

Consideration was also given to a comparative analysis in the Broadridge Section 15(c) Report of the investment management fees and total expense ratio of the Fund in comparison to those of a group of other funds selected by Lipper as its appropriate Lipper expense group.

Lipper expense data is based upon information taken from each fund’s most recent annual report, which reflects historical asset levels that may be quite different from those currently existing, particularly in a period of market volatility.

In reviewing comparative costs, emphasis was given to the Fund’s contractual management fees in comparison with the contractual management fees that would have been charged by other funds within its Lipper expense group assuming they were similar in size to the Fund, as well as the actual total expenses of the Fund in comparison with those of its Lipper expense group. The Lipper contractual management fee analysis includes administrative charges as being part of the management fee, and total expenses, for comparative consistency, are shown by Lipper for Fund Advisor Class shares. The Fund’s contractual management fee rate was in the most expensive quintile of its Base Expense Group and its Alternate Expense Group. The Fund’s total expenses were in the most expensive quintile of its Base Expense Group and the second-most expensive quintile of its Alternate Expense Group.

Noting (i) that the Fund’s contractual management fees and total expenses were lower than the Fund’s primary competitor, (ii) the factors and limitations with respect to the Broadridge Section 15(c) Report (including the inclusion of single-manager funds in both peer groups and the fact that the Broadridge Section 15(c) Report did not reflect the changes to the Fund’s investment management fees and the cap in the fee waiver and expense limitation arrangement described above), and (iii) factors relating to the Fund’s operations, such as the quality and experience of K2 Advisors and the Sub-Advisors and the nature and quality of the services provided and/or to be provided by K2 Advisors and the Sub-Advisors, the Board found such comparative fees and expenses to be acceptable.

The trustees also reviewed the Profitability Study addressing profitability of Franklin Resources, Inc. (FRI), from its overall U.S. fund business, as well as profitability to K2 Advisors and its affiliates, from providing investment management and other services to the Fund during the 12-month period ended September 30, 2023, the most recent fiscal year-end of FRI. The trustees reviewed the basis on which such reports are prepared and the cost allocation methodology utilized in the Profitability Study, it being recognized that allocation methodologies may each be reasonable while producing different results. The Board also noted that an independent registered public accounting firm has been engaged by K2 Advisors to periodically review and assess the allocation methodologies to be used solely by the Board with respect to the profitability analysis.

The independent trustees met with management to discuss the Profitability Study. This included, among other things, a comparison of investment management income with investment management expenses of the Fund; a comparison of underwriting revenues and expenses; the relative relationship of investment management and underwriting expenses; shareholder servicing profitability; economies of scale; and the relative contribution of the Fund to the profitability of K2 Advisors and its parent. In discussing the Profitability Study with the Board, K2 Advisors stated its belief that the costs incurred in establishing the infrastructure necessary to operate the type of mutual fund operations conducted by it and its affiliates may not be fully reflected in the expenses allocated to the Fund in determining its profitability.

With respect to the impact on K2 Advisors’ and its affiliates’ profitability as a result of hiring FAV as a sub-advisor to the Fund, the Board considered the following: (1) the fee waiver and expense limitation arrangements in effect, the amount of Fund expenses that were absorbed since the inception of the Fund by K2 Advisors through such arrangements, and the expected impact of the engagement of FAV on the amount of Fund expenses being waived by K2 Advisors, (2) the level of sub-advisory fees to be paid to FAV, and (3) whether there is a conflict of interest from which K2 Advisors or the FAV derives an inappropriate advantage and concluded that no such inappropriate advantage existed.

The Board also took into account management’s expenditures in improving shareholder services provided to the Fund, as well as the need to meet additional regulatory and compliance requirements resulting from recent US Securities and Exchange Commission and other regulatory requirements. The trustees also considered the extent to which K2 Advisors and the Sub-Advisors may derive ancillary benefits from Fund operations, including those derived from the allocation of Fund brokerage and the use of commission dollars to pay for research and other similar services.

Based upon their consideration of all these factors, the trustees determined that the level of profits realized by K2 Advisors and its affiliates in providing services to the Fund was not excessive in view of the nature, quality and extent of services provided. In addition, the Board noted that shareholders are able to redeem their Fund shares at any time if shareholders believe that Fund fees and expenses are too high or if they are dissatisfied with the performance of the Fund.

ECONOMIES OF SCALE. The Board considered economies of scale realized by K2 Advisors and its affiliates and the Sub-Advisors as the Fund grows larger and the extent to which they are shared with Fund shareholders, as for example, in the level of the investment management fees charged, in the quality and efficiency of services rendered and in increased capital commitments benefiting the Fund directly or indirectly. The trustees noted that benefits of economies of scale will, depending on the fee waiver and expense limitation arrangement in effect at the time, potentially be shared with Fund shareholders due to the decline in the effective investment management fee rate as breakpoints are achieved by the Fund. The Board also considered the fee waiver and

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expense limitation arrangement in effect, and the amount of Fund expenses that were absorbed since inception of the Fund by K2 Advisors through such waiver and arrangement. The Board concluded that economies of scale were deemed not to be a significant factor at that time in light of, among other matters, the fee waiver and expense limitation arrangement in effect.

CONCLUSION

Based on its review, consideration and evaluation of all factors it believed relevant, including the above-described factors and conclusions, the Board unanimously approved the continuation of the Fund’s investment management agreement for an additional one-year period.

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© 2024 Franklin Templeton Investments.  All rights reserved.	18120-AFSOI 07/24

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES.

The information is disclosed as part of the Financial Statements included in Item 7 of this Form N-CSR.

ITEM 9. PROXY DISCLOSURES FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES.

The information is disclosed as part of the Financial Statements included in Item 7 of this Form N-CSR.

ITEM 10. REMUNERATION PAID TO DIRECTORS, OFFICERS, AND OTHERS OF OPEN-END MANAGEMENT INVESTMENT COMPANIES.

The information is disclosed as part of the Financial Statements included in Item 7 of this Form N-CSR.

ITEM 11. STATEMENT REGARDING BASIS FOR APPROVAL OF INVESTMENT ADVISORY CONTRACT.

The information is disclosed as part of the Financial Statements included in Item 7 of this Form N-CSR.

ITEM 12. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 13.   PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 14.   PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.

Not applicable.

ITEM 15.   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 16.   CONTROLS AND PROCEDURES.

(a) The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)).

(b) There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d))) that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

ITEM 17.   DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANY.

Not applicable.

ITEM 18.   RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION.

Responses to both (a) and (b) are N/A

ITEM 19.   EXHIBITS.

(a)	(1)	Code of Ethics
(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 and Chief Accounting Officer
(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 and Chief Accounting Officer

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.

(Registrant) Franklin Alternative Strategies Funds
By (Signature and Title)	/s/ Christopher Kings
	Christopher Kings, Chief Executive Officer – Finance and
	Administration

Date July 30, 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 (Signature and Title)	/s/ Christopher Kings
	Christopher Kings, Chief Executive Officer – Finance and
	Administration

Date July 30, 2024

By (Signature and Title)	/s/ Jeffrey White
	Jeffrey White, Treasurer, Chief Financial Officer, and Chief
	Accounting Officer

Date July 30, 2024