Franklin K2 Alternative Strategies Fund (FABZX) NPORT-P Franklin K2 Long Short Credit Fund (Aug 2020 report)

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

Consolidated Statement of Investments, August 31, 2020 (unaudited)

Franklin K2 Alternative Strategies Fund

	Country	Shares/ Warrants/ Rights		Value
Common Stocks and Other Equity Interests 39.2%
Aerospace & Defense 0.0%†
aBombardier Inc., B	Canada		609,589	$	191,614
Lockheed Martin Corp.	United States		35		13,659
					205,273
Air Freight & Logistics 0.3%
a,bAtlas Air Worldwide Holdings Inc.	United States		3,319		187,158
Deutsche Post AG	Germany		7,761		353,778
DSV Panalpina A/S	Denmark		6,535		1,020,193
Expeditors International of Washington Inc.	United States		576		50,913
FedEx Corp.	United States		5,786		1,271,994
United Parcel Service Inc., B	United States		84		13,744
					2,897,780
Airlines 0.0%†
Alaska Air Group Inc.	United States		5,498		214,147
Auto Components 0.2%
aDelphi Technologies PLC	United States		123,160		2,139,289
Automobiles 0.1%
bHarley-Davidson Inc.	United States		43,535		1,206,355
Banks 0.0%†
aBarclays PLC	United Kingdom		108,406		158,721
cCitigroup Inc.	United States		272		13,905
cTruist Financial Corp.	United States		362		14,049
					186,675
Beverages 0.3%
The Coca-Cola Co.	United States		2,926		144,925
Davide Campari-Milano NV	Italy		278,370		2,854,005
					2,998,930
Biotechnology 2.8%
AbbVie Inc.	United States		142		13,599
aAcadia Pharmaceuticals Inc.	United States		4,333		171,543
aAimmune Therapeutics Inc.	United States		47,368		1,620,933
a,d,eAlder Biopharmaceuticals Inc., Contingent Value, rts., 12/31/24	United States		50,624		44,549
Amgen Inc.	United States		57		14,439
a,bAmicus Therapeutics Inc.	United States		56,310		822,126
aApellis Pharmaceuticals Inc.	United States		49,293		1,519,703
aArgenx SE, ADR	Netherlands		6,535		1,511,349
aAssembly Biosciences Inc.	United States		54,198		1,185,310
aBioMarin Pharmaceutical Inc.	United States		16,352		1,275,947
aBlack Diamond Therapeutics Inc.	United States		10,447		300,560
aBurning Rock Biotech Ltd., ADR	China		12,861		296,575
aConstellation Pharmaceuticals Inc.	United States		11,304		237,949
aCRISPR Therapeutics AG	Switzerland		6,271		586,088
aCytodyn Inc.	United States		2,742		9,213
aCytokinetics Inc.	United States		14,108		338,028
aDenali Therapeutics Inc.	United States		9,053		288,791
aFate Therapeutics Inc.	United States		25,207		917,535
a,eGenetron Holdings Ltd., ADR	China		20,975		259,670
aGenmab A/S, ADR	Denmark		13,614		514,065
Gilead Sciences Inc.	United States		205		13,684
aGossamer Bio Inc.	United States		36,904		512,966
Immatics NV, wts., 12/31/25	Germany		10,049		31,102
aImmunomedics Inc.	United States		42,228		1,881,680
a,fInnovent Biologics Inc., 144A	China		73,859		490,719
a,eInvitae Corp.	United States		8,635		301,880
aIovance Biotherapeutics Inc.	United States		8,692		289,704

Quarterly Consolidated Statement of Investments | See Notes to the Consolidated Statements of Investments.

1

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares/ Warrants/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Biotechnology (continued)
aKymera Therapeutics Inc.	United States		1,770	$	56,463
aLegend Biotech Corp., ADR	United States		3,426		116,484
aMadrigal Pharmaceuticals Inc.	United States		1,917		206,461
aMirati Therapeutics Inc.	United States		5,341		797,785
aMomenta Pharmaceuticals Inc.	United States		40,699		2,123,267
a,bNatera Inc.	United States		35,848		2,283,876
aNurix Therapeutics Inc.	United States		5,051		118,193
a,eORIC Pharmaceuticals Inc.	United States		3,738		93,637
a,cPrincipia Biopharma Inc.	United States		37,374		3,737,774
aProQR Therapeutics NV	Netherlands		46,914		295,558
aRegeneron Pharmaceuticals Inc.	United States		1,712		1,061,320
aRelay Therapeutics Inc.	United States		3,890		156,339
aSage Therapeutics Inc.	United States		10,117		530,535
a,bSarepta Therapeutics Inc.	United States		14,561		2,132,022
aSeattle Genetics Inc.	United States		3,054		483,570
aSeres Therapeutics Inc.	United States		5,906		156,450
aTurning Point Therapeutics Inc.	United States		9,959		778,595
aVertex Pharmaceuticals Inc.	United States		7,941		2,216,492
aZai Lab Ltd., ADR	China		5,100		404,787
					33,199,315
Building Products 0.0%†
Carrier Global Corp.	United States		1,779		53,103
Masco Corp.	United States		201		11,718
					64,821
Capital Markets 0.9%
a,fAmundi SA, 144A	France		25,204		1,958,019
fAnima Holding SpA, 144A	Italy		102,616		450,773
aCapstar Special Purpose Acquisition Corp., A	United States		13,782		134,650
aCapstar Special Purpose Acquisition Corp., wts., 7/9/27	United States		6,891		4,114
aCF Finance Acquisition Corp., A	United States		14,705		152,344
aChurchill Capital Corp. II, A	United States		4,735		49,670
aChurchill Capital Corp. III, wts., 3/1/27	United States		5,837		13,425
aChurchill Capital Corp. IV	United States		39,280		390,443
a,eCiig Merger Corp., A	United States		3,031		30,704
aCITIC Capital Acquisition Corp., A	China		6,957		68,039
aColonnade Acquisition Corp.	United States		10,088		99,468
aDragoneer Growth Opportunities Corp.	United States		4,220		50,893
a,bE.Merge Technology Acquisition Corp.	United States		32,844		328,440
aFoley Trasimene Acquisition Corp.	United States		4,634		49,584
aFoley Trasimene Acquisition Corp., A	United States		3,452		34,865
aFoley Trasimene Acquisition Corp. II	United States		27,939		279,949
aFortress Value Acquisition Corp. II	United States		4,020		40,803
a,eForum Merger III Corp.	United States		23,945		238,971
a,eFusion Acquisition Corp., A	United States		22,973		223,987
aFusion Acquisition Corp., wts., 6/1/27	United States		21,802		12,344
aGores Holdings V Inc.	United States		19,940		201,394
a,bGS Acquisition Holdings Corp. II	United States		35,932		376,927
aHudson Executive Investment Corp., A	United States		41,186		404,447
aHudson Executive Investment Corp., wts., 6/21/25	United States		28,108		22,486
aLive Oak Acquisition Corp., A	United States		16,318		160,406
aMonocle Acquisition Corp.	United States		3,497		35,984
bMoody’s Corp.	United States		9,897		2,916,052
aOne	United States		24,116		243,572
aProperty Solutions Acquisition Corp.	United States		19,217		189,287
S&P Global Inc.	United States		39		14,290
aSCVX Corp., A	United States		6,958		68,815

2

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares/ Warrants/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Capital Markets (continued)
TD Ameritrade Holding Corp.	United States		21,924	$	841,443
					10,086,588
Chemicals 0.8%
Ecolab Inc., W	United States		9,104		1,794,216
The Sherwin-Williams Co.	United States		11,931		8,006,298
					9,800,514
Commercial Services & Supplies 1.1%
aAdvanced Disposal Services Inc.	United States		177,827		5,357,927
bCintas Corp.	United States		14,623		4,872,969
Republic Services Inc., A	United States		33,639		3,119,008
					13,349,904
Communications Equipment 0.0%†
Cisco Systems Inc.	United States		319		13,468
Construction Materials 0.3%
Buzzi Unicem SpA	Italy		9,499		232,200
Cemex SAB de CV, ADR	Mexico		72,599		233,043
LafargeHolcim Ltd., B	Switzerland		54,747		2,599,069
					3,064,312
Containers & Packaging 0.7%
bBall Corp.	United States		100,464		8,074,292
Distributors 0.2%
bPool Corp.	United States		7,684		2,519,123
Diversified Financial Services 0.3%
aACE Convergence Acquisition Corp.	United States		12,220		121,711
aAscendant Digital Acquisition Corp.	United States		19,684		199,793
aBowX Acquisition Corp.	United States		12,175		122,359
aCC Neuberger Principal Holdings II	United States		39,672		403,266
aCF Finance Acquisition Corp. II	United States		31,159		309,097
adMY Technology Group Inc. II	United States		12,060		120,962
a,eGo Acquisition Corp.	United States		12,171		121,101
aNetfin Acquisition Corp., A	United States		31,216		328,392
Netfin Acquisition Corp., wts., 8/01/24	United States		980		1,490
a,d,gOne Call Corp.	United States		4,965		528,768
a,eOsprey Technology Acquisition Corp., A	United States		19,251		192,895
a,ePershing Square Tontine Holdings Ltd.	United States		9,603		205,600
aRedBall Acquisition Corp.	United States		33,747		345,907
aStar Peak Energy Transition Corp.	United States		10,047		100,068
aYucaipa Acquisition Corp.	United States		11,161		112,726
					3,214,135
Diversified Telecommunication Services 0.6%
aAltice Europe NV, A	Netherlands		3,919		17,302
cAT&T Inc.	United States		18,840		561,621
aMasmovil Ibercom SA	Spain		196,310		5,264,286
fSunrise Communications Group AG, 144A	Switzerland		8,892		1,059,255
Telecom Italia SpA	Italy		194,459		92,620
Verizon Communications Inc.	United States		223		13,217
					7,008,301
Electric Utilities 0.3%
Duke Energy Corp.	United States		1,679		134,891
a,bEnergy Harbor Corp.	United States		82,474		1,690,717
bFirstEnergy Corp.	United States		37,184		1,063,090
aPG&E Corp.	United States		13,227		122,482
					3,011,180

3

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares/ Warrants/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Electrical Equipment 0.3%
aOsram Licht AG	Germany		75,156	$	3,923,537
Electronic Equipment, Instruments & Components 0.1%
aFitbit Inc., A	United States		245,502		1,561,393
Isra Vision AG	Germany		1,542		91,635
					1,653,028
Entertainment 0.0%†
Activision Blizzard Inc.	United States		163		13,614
Cinemark Holdings Inc.	United States		6,305		92,368
a,bTake-Two Interactive Software Inc.	United States		1,843		315,503
					421,485
Equity Real Estate Investment Trusts (REITs) 0.1%
American Tower Corp.	United States		55		13,703
Iron Mountain Inc.	United States		445		13,390
bTaubman Centers Inc..	United States		19,818		759,030
VICI Properties Inc.	United States		13,747		307,108
					1,093,231
Food & Staples Retailing 0.4%
Costco Wholesale Corp.	United States		12,958		4,504,979
cThe Kroger Co.	United States		374		13,344
Wal-Mart Stores Inc.	United States		1,311		182,032
					4,700,355
Food Products 0.0%†
Chocoladefabriken Lindt & Spruengli AG	Switzerland		3		265,120
Health Care Equipment & Supplies 2.2%
Abbott Laboratories	United States		19,906		2,179,110
aAlcon Inc.	Switzerland		6,799		389,855
a,bBoston Scientific Corp.	United States		44,647		1,831,420
Danaher Corp., W	United States		5,988		1,236,342
aDexCom Inc.	United States		6,104		2,596,703
aEdwards Lifesciences Corp.	United States		12,075		1,036,518
aInsulet Corp.	United States		1,683		367,315
a,bIntuitive Surgical Inc.	United States		2,062		1,506,992
aNevro Corp.	United States		2,655		365,169
aShockwave Medical Inc.	United States		13,067		830,277
aSilk Road Medical Inc.	United States		13,567		827,316
aTandem Diabetes Care Inc.	United States		5,435		612,633
Teleflex Inc.	United States		1,033		405,917
aVarian Medical Systems Inc.	United States		26,720		4,640,462
aWright Medical Group NV	United States		193,013		5,834,783
Zimmer Biomet Holdings Inc.	United States		5,206		733,421
					25,394,233
Health Care Providers & Services 0.9%
Anthem Inc.	United States		2,753		775,025
aCentene Corp.	United States		16,030		982,960
Cigna Corp.	United States		6,384		1,132,330
CVS Health Corp.	United States		2,471		153,498
aGuardant Health Inc.	United States		10,655		1,017,552
Humana Inc.	United States		5,068		2,104,082
aPetiq Inc., A	United States		2,760		97,097
UnitedHealth Group Inc.	United States		15,180		4,744,509
					11,007,053
Health Care Technology 0.5%
a,eAccolade Inc.	United States		2,035		68,397
a,cLivongo Health Inc.	United States		30,084		4,130,533

4

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares/ Warrants/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Health Care Technology (continued)
aPhreesia Inc.	United States		11,219	$	353,847
a,eTeladoc Health Inc.	United States		5,255		1,133,451
					5,686,228
Hotels, Restaurants & Leisure 1.0%
aCaesars Entertainment Inc.	United States		57,841		2,649,118
bCedar Fair LP	United States		15,951		471,352
bDarden Restaurants Inc.	United States		3,414		295,891
Domino’s Pizza Inc.	United States		6,889		2,817,326
bMarriott Vacations Worldwide Corp.	United States		1,399		132,443
McDonald’s Corp.	United States		975		208,182
Netent AB	Sweden		450,159		4,337,728
bSIX Flags Entertainment Corp.	United States		9,853		214,106
Starbucks Corp.	United States		441		37,251
bWynn Resorts Ltd.	United States		2,365		206,819
Yum! Brands Inc.	United States		108		10,352
					11,380,568
Household Durables 0.1%
D.R. Horton Inc.	United States		165		11,776
a,bNVR Inc.	United States		249		1,037,917
cPulteGroup Inc.	United States		290		12,931
					1,062,624
Household Products 0.0%†
Kimberly-Clark Corp.	United States		84		13,252
The Procter & Gamble Co.	United States		1,306		180,659
					193,911
Independent Power & Renewable Electricity Producers 0.1%
Clearway Energy Inc., C	United States		60,723		1,549,044
Industrial Conglomerates 0.0%†
Honeywell International Inc.	United States		48		7,947
Smiths Group PLC	United Kingdom		17,888		332,013
					339,960
Insurance 1.2%
Aflac Inc.	United States		83		3,015
The Allstate Corp.	United States		142		13,206
Aon PLC, A	United States		3,691		738,163
aeHealth Inc.	United States		6,652		419,874
cMetLife Inc.	United States		329		12,653
National General Holdings Corp.	United States		79,374		2,702,685
The Progressive Corp.	United States		145		13,781
RSA Insurance Group PLC	United Kingdom		44,331		264,585
aSelectquote Inc.	United States		13,423		244,970
aTrupanion Inc.	United States		26,728		1,676,647
Willis Towers Watson PLC	United States		36,065		7,412,439
					13,502,018
Interactive Media & Services 2.5%
a58.Com Inc., ADR	China		38,156		2,112,316
aAlphabet Inc., A	United States		2,975		4,847,852
aAlphabet Inc., C	United States	��	1,561		2,550,955
aBitauto Holdings Ltd., ADR	China		23,562		371,573
aFacebook Inc., A	United States		21,847		6,405,540
aMatch Group Inc.	United States		13,076		1,460,328
aSogou Inc., ADR	China		548,635		4,745,693
Tencent Holdings Ltd.	China		92,557		6,323,342

5

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares/ Warrants/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Interactive Media & Services (continued)
aZillow Group Inc., C	United States		4,822	$	413,535
					29,231,134
Internet & Direct Marketing Retail 1.7%
a,bAlibaba Group Holding Ltd., ADR	China		23,517		6,750,085
aAmazon.com Inc.	United States		1,410		4,865,853
aBooking Holdings Inc.	United States		111		212,060
ceBay Inc.	United States		30,281		1,658,793
aGrubHub Inc.	United States		72,221		5,225,189
aMercadoLibre Inc.	Argentina		1,237		1,445,546
Shutterstock Inc.	United States		6,377		320,891
					20,478,417
IT Services 4.0%
Accenture PLC, A	United States		57		13,676
aCardtronics PLC, A	United States		7,270		157,832
Cognizant Technology Solutions Corp., A	United States		6,000		401,160
Edenred	France		10,705		552,588
Fidelity National Information Services Inc.	United States		12,730		1,920,321
aFleetCor Technologies Inc.	United States		11,877		2,986,472
Genpact Ltd.	United States		91,753		3,870,142
bGlobal Payments Inc.	United States		42,249		7,462,018
aGoDaddy Inc., A	United States		35,686		2,986,204
International Business Machines Corp.	United States		2,003		246,990
MasterCard Inc., A	United States		27,963		10,016,067
aMongoDB Inc., A	United States		2,761		645,522
a,fNetwork International Holdings PLC, 144A	United Arab Emirates		144,368		722,535
a,fNexi SpA, 144A	Italy		65,409		1,164,097
aPayPal Holdings Inc.	United States		29,411		6,003,961
aStoneCo. Ltd.	Brazil		35,021		1,786,071
aVeriSign Inc.	United States		11,350		2,437,980
bVisa Inc., A	United States		9,405		1,993,766
a,bWEX Inc.	United States		8,682		1,386,602
aWix.com Ltd.	Israel		829		244,248
					46,998,252
Leisure Products 0.0%†
BRP Inc.	Canada		1,934		105,037
Life Sciences Tools & Services 1.5%
a10x Genomics Inc., A	United States		3,044		348,903
aAvantor Inc.	United States		15,120		341,258
aBerkeley Lights Inc.	United States		1,070		69,978
aEurofins Scientific SE	Luxembourg		2,642		2,125,937
Gerresheimer AG	Germany		9,835		1,160,159
aIllumina Inc.	United States		3,583		1,279,919
aIQVIA Holdings Inc.	United States		5,360		877,700
aMettler-Toledo International Inc.	United States		3,910		3,795,750
aQIAGEN NV	Germany		70,050		3,558,591
aRepligen Corp.	United States		5,221		808,785
Thermo Fisher Scientific Inc.	United States		6,487		2,782,793
a,fWuxi Biologics Cayman Inc., 144A	China		32,990		854,112
					18,003,885
Machinery 0.3%
bDeere & Co.	United States		5,981		1,256,369
aNavistar International Corp.	United States		8,557		273,653
Neles OYJ	Finland		71,594		978,619

6

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares/ Warrants/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Machinery (continued)
The Toro Co.	United States		14,096	$	1,061,147
					3,569,788
Marine 0.0%†
Star Bulk Carriers Corp.	Greece		35,598		252,746
Media 0.5%
aCardlytics Inc.	United States		8,215		623,108
cComcast Corp., A	United States		327		14,653
Fox Corp.	United States		69		1,922
ITV PLC	United Kingdom		293,248		234,712
aNetflix Inc.	United States		4,159		2,202,440
Nexstar Media Group Inc., A	United States		147		14,113
aPostmedia Network Canada Corp., B	Canada		666,338		848,025
aSnap Inc., A	United States		69,570		1,571,586
aStroeer SE & Co. KGaA	Germany		2,335		182,043
					5,692,602
Metals & Mining 0.2%
Boliden AB	Sweden		3,634		108,573
First Quantum Minerals Ltd.	Zambia		66,564		658,827
bFreeport-McMoRan Inc.	United States		18,761		292,859
aKensington Capital Acquisition Corp.	United States		15,384		159,994
Kirkland Lake Gold Ltd.	Canada		3,726		198,260
Lundin Mining Corp., Common Subscription Receipt	Canada		54,592		341,946
Newmont Mining Corp.	United States		198		13,321
aSibanye Stillwater Ltd., ADR	South Africa		15,715		193,452
Teck Resources Ltd., B	Canada		25,562		294,474
bVale SA, B, ADR	Brazil		23,255		255,805
					2,517,511
Multiline Retail 0.0%†
Dollar General Corp.	United States		40		8,075
Target Corp.	United States		32		4,839
					12,914
Multi-Utilities 0.0%†
Dominion Energy Inc.	United States		1,843		144,565
Oil, Gas & Consumable Fuels 0.2%
aBattalion Oil Corp.	United States		3,790		31,609
cChevron Corp.	United States		158		13,261
cEnterprise Products Partners LP	United States		746		13,100
bHess Corp.	United States		3,154		145,210
Kinder Morgan Inc.	United States		637		8,803
Noble Energy Inc.	United States		198,655		1,976,617
cThe Williams Cos. Inc.	United States		648		13,453
					2,202,053
Paper & Forest Products 0.1%
a,dTopco Associates LLC	United Kingdom		144,632		—
West Fraser Timber Co. Ltd.	Canada		13,292		712,827
					712,827
Personal Products 0.0%†
The Estee Lauder Cos. Inc., A	United States		202		44,787
Unilever NV	United Kingdom		6,537		379,842
					424,629
Pharmaceuticals 1.4%
bAstraZeneca PLC, ADR	United Kingdom		41,505		2,324,280
cBristol-Myers Squibb Co.	United States		14,102		877,144

7

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares/ Warrants/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Pharmaceuticals (continued)
aBristol-Myers Squibb Co., Contingent Value, rts., 1/23/65	United States		139,138	$	372,890
aCatalent Inc.	United States		4,288		396,640
Eli Lilly & Co., W	United States		14,541		2,157,739
Hikma Pharmaceuticals PLC	Jordan		13,950		442,138
aHorizon Therapeutics PLC	United States		2,530		190,054
Johnson & Johnson	United States		1,116		171,206
cMerck & Co. Inc.	United States		167		14,240
aMyokardia Inc.	United States		2,496		273,162
bNovo Nordisk AS, ADR	Denmark		24,785		1,636,801
aPacira Biosciences Inc.	United States		2,600		162,552
bPfizer Inc.	United States		6,862		259,315
aRevance Therapeutics Inc.	United States		20,163		589,364
Roche Holding AG	Switzerland		31,582		3,443,682
Zoetis Inc., A	United States		22,959		3,675,736
					16,986,943
Professional Services 1.6%
Corelogic Inc.	United States		81,626		5,419,966
aCoStar Group Inc.	United States		2,193		1,860,980
Experian PLC	United Kingdom		24,233		905,410
fIntertrust NV, 144A	Netherlands		283,677		5,091,353
SGS SA	Switzerland		163		422,401
TransUnion	United States		17,282		1,498,695
aTriNet Group Inc.	United States		43,939		2,980,822
					18,179,627
Road & Rail 1.0%
Canadian Pacific Railway Ltd.	Canada		179		52,927
CSX Corp.	United States		32,741		2,503,377
Kansas City Southern	United States		23,573		4,291,228
bUnion Pacific Corp.	United States		23,777		4,575,646
					11,423,178
Semiconductors & Semiconductor Equipment 1.2%
aAdvanced Micro Devices Inc.	United States		19,895		1,806,864
cApplied Materials Inc.	United States		216		13,306
ASM International NV	Netherlands		7,682		1,153,356
ASML Holding NV, N.Y. shares, G	Netherlands		5,865		2,194,566
BE Semiconductor Industries NV	Netherlands		33,263		1,585,284
aEnphase Energy Inc.	United States		878		67,808
Intel Corp.	United States		272		13,858
KLA Corp.	United States		6,067		1,244,584
LAM Research Corp.	United States		39		13,117
aLattice Semiconductor Corp.	United States		36,736		1,050,650
Marvell Technology Group Ltd.	Bermuda		72,085		2,795,456
Maxim Integrated Products Inc.	United States		15,366		1,051,649
Microchip Technology Inc.	United States		6,817		747,825
NVIDIA Corp.	United States		28		14,979
QUALCOMM Inc.	United States		558		66,458
a,d,f,hSunEdison Inc., Contingent Distribution, 144A	United States		35,000		700
Texas Instruments Inc.	United States		98		13,931
					13,834,391
Software 4.0%
aAdobe Inc.	United States		6,709		3,444,333
aAtlassian Corp. PLC, A	United States		8,138		1,560,543
aAvalara Inc.	United States		13,503		1,787,932
a,bCerence Inc.	United States		4,402		234,186
aCeridian HCM Holding Inc.	United States		16,890		1,343,093

8

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares/ Warrants/ Rights		Value
Common Stocks and Other Equity Interests (continued)
Software (continued)
Citrix Systems Inc.	United States		42	$	6,098
aDatadog Inc., A	United States		4,118		344,059
aGuidewire Software Inc.	United States		19,513		2,191,505
aHubSpot Inc.	United States		3,754		1,124,999
Intuit Inc.	United States		11,683		4,035,192
bMicrosoft Corp.	United States		37,608		8,481,732
cNortonLifeLock Inc.	United States		597		14,041
aNuance Communications Inc.	United States		10,000		299,600
cOracle Corp.	United States		238		13,618
aRosetta Stone Inc.	United States		35,721		1,085,204
aSalesforce.com Inc.	United States		14,784		4,030,858
SAP SE	Germany		20,721		3,426,100
a,bServiceNow Inc.	United States		7,515		3,622,380
aSlack Technologies Inc., A	United States		46,787		1,536,485
aSplunk Inc.	United States		12,127		2,659,815
aSVMK Inc.	United States		41,296		1,027,858
a,eVMware Inc., A	United States		8,659		1,250,706
aWorkday Inc., A	United States		14,003		3,356,659
aZscaler Inc.	United States		4,365		625,679
					47,502,675
Specialty Retail 1.9%
aAsbury Automotive Group Inc.	United States		7,763		821,248
Best Buy Co. Inc.	United States		121		13,420
Dick’s Sporting Goods Inc.	United States		2,032		109,972
aFive Below Inc.	United States		18,257		1,998,229
aFrasers Group PLC	United Kingdom		180,900		841,871
The Gap Inc.	United States		9,669		168,144
a,fGrandVision NV, 144A	Netherlands		21,813		625,588
The Home Depot Inc.	United States		27,150		7,738,836
bL Brands Inc.	United States		8,178		240,433
Lowe’s Cos. Inc.	United States		85		13,999
aO’Reilly Automotive Inc.	United States		3,693		1,719,571
Sonic Automotive Inc., A	United States		8,775		370,831
b,cTiffany & Co.	United States		41,421		5,074,072
aUlta Beauty Inc.	United States		5,095		1,182,957
aVroom Inc.	United States		11,436		784,853
					21,704,024
Technology Hardware, Storage & Peripherals 0.2%
Apple Inc.	United States		13,384		1,727,071
b,cHP Inc.	United States		16,293		318,528
					2,045,599
Textiles, Apparel & Luxury Goods 0.4%
aAdidas AG	Germany		13,221		4,023,102
aCapri Holdings Ltd.	United States		36,843		583,593
LVMH Moet Hennessy Louis Vuitton SE	France		93		43,675
Nike Inc., B	United States		425		47,553
Tapestry Inc.	United States		34,291		505,106
					5,203,029
Thrifts & Mortgage Finance 0.0%†
a,bRocket Cos. Inc., A	United States		13,880		388,640
Tobacco 0.1%
cAltria Group Inc.	United States		306		13,384
Philip Morris International Inc.	United States		163		13,006

9

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares/ Warrants/ Rights			Value
Common Stocks and Other Equity Interests (continued)
Tobacco (continued)
Swedish Match AB	Sweden		10,900		$	827,855
						854,245
Trading Companies & Distributors 0.4%
Brenntag AG	Germany		45,500			2,850,859
IMCD Group NV	Netherlands		3,123			331,723
aWESCO International Inc.	United States		23,297			1,091,464
						4,274,046
Wireless Telecommunication Services 0.2%
aT-Mobile U.S. Inc.	United States		14,827			1,730,014
bVodafone Group PLC, ADR	United Kingdom		36,378			537,303
						2,267,317
Total Common Stocks and Other Equity Interests (Cost $313,493,940)						460,436,871
Convertible Preferred Stocks 0.4%
Diversified Financial Services 0.3%
a,d,gOne Call Corp., cvt. pfd.	United States		33,337			3,550,384
Electric Utilities 0.1%
bNextEra Energy Inc., 5.279%, cvt. pfd.	United States		23,347			1,111,551
Food Products 0.0%†
Bunge Ltd., 4.875%, cvt. pfd.	United States		3,973			377,435
Gas Utilities 0.0%†
El Paso Energy Capital Trust I, 4.75%, cvt. pfd.	United States		114			5,563
Oil, Gas & Consumable Fuels 0.0%†
Chesapeake Energy Corp., 5.75%, cvt. pfd.	United States		139			229
Total Convertible Preferred Stocks (Cost $5,614,292)						5,045,162
Preferred Stocks 0.3%
Banks 0.0%†
Bank of America Corp., 7.25%, pfd.	United States		70			104,652
Wells Fargo & Co., 7.50%, pfd.	United States		156			215,358
						320,010
Electric Utilities 0.0%†
SCE Trust II, 5.10%, pfd.	United States		10,492			258,943
SCE Trust VI, 5.00%, pfd.	United States		4,649			111,529
						370,472
IT Services 0.0%†
Sabre Corp., 6.50%, pfd.	United States		3,927			387,202
Trading Companies & Distributors 0.3%
WESCO International Inc., 10.625%, pfd.	United States		100,283			2,784,859
Total Preferred Stocks (Cost $3,694,426)						3,862,543
		Principal Amount*
Convertible Bonds 15.7%
Air Freight & Logistics 0.3%				��
bAir Transport Services Group Inc., senior note, 1.125%, 10/15/24	United States		1,166,000			1,253,110

10

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*			Value
Convertible Bonds (continued)
Air Freight & Logistics (continued)
Atlas Air Worldwide Holdings Inc., senior note,
2.25%, 6/01/22	United States		1,299,000		$	1,381,957
b1.875%, 6/01/24	United States		1,167,000			1,378,898
						4,013,965
Airlines 0.3%
fAir Canada, senior note, 144A, 4.00%, 7/01/25	Canada		1,039,000			1,271,320
bAmerican Airlines Group Inc., senior note, 6.50%, 7/01/25	United States		1,171,000			1,133,617
b,fCopa Holdings SA, senior note, 144A, 4.50%, 4/15/25	Panama		1,193,000			1,456,209
						3,861,146
Automobiles 0.1%
b,fWinnebago Industries Inc., senior note, 144A, 1.50%, 4/01/25	United States		1,220,000			1,341,154
Banks 0.1%
bHope Bancorp Inc., senior bond, 2.00%, 5/15/38	United States		1,815,000			1,519,981
Biotechnology 1.3%
fApellis Pharmaceuticals Inc., senior note, 144A, 3.50%, 9/15/26	United States		1,088,000			1,186,207
BioMarin Pharmaceutical Inc., senior sub. note,
e0.599%, 8/01/24	United States		1,296,000			1,384,508
f144A, 1.25%, 5/15/27	United States		645,000			643,777
b,fBridgebio Pharma Inc., senior note, 144A, 2.50%, 3/15/27	United States		1,340,000			1,331,582
b,fCoherus Biosciences Inc., senior sub. note, 144A, 1.50%, 4/15/26	United States		1,037,000			1,244,779
Flexion Therapeutics Inc., senior note, 3.375%, 5/01/24	United States		1,474,000			1,242,990
Gossamer Bio Inc., senior note, 5.00%, 6/01/27	United States		566,000			622,872
Insmed Inc., senior note, 1.75%, 1/15/25	United States		1,039,000			1,053,486
Intercept Pharmaceuticals Inc., senior note,
3.25%, 7/01/23	United States		1,298,000			1,072,093
2.00%, 5/15/26	United States		1,038,000			780,132
Ironwood Pharmaceuticals Inc., senior note,
2.25%, 6/15/22	United States		792,000			842,774
1.50%, 6/15/26	United States		1,166,000			1,211,911
bKaryopharm Therapeutics Inc., senior note, 3.00%, 10/15/25	United States		947,000			1,141,595
Ligand Pharmaceuticals Inc., senior note, 0.75%, 5/15/23	United States		1,040,000			943,635
Radius Health Inc., senior note, 3.00%, 9/01/24	United States		1,036,000			853,923
						15,556,264
Building Products 0.1%
bPatrick Industries Inc., senior note, 1.00%, 2/01/23	United States		1,685,000			1,658,857
Communications Equipment 0.0%†
CalAmp Corp., senior note, 2.00%, 8/01/25	United States		40,000			32,637
Consumer Finance 0.7%
Encore Capital Group Inc., senior note,
b2.875%, 3/15/21	United States		1,429,000			1,446,364
b3.25%, 3/15/22	United States		2,009,000			2,383,462
f144A, 3.25%, 10/01/25	United States		689,000			893,582
EZCORP Inc., senior note, 2.875%, 7/01/24	United States		842,000			765,982
fLendingTree Inc., senior note, 144A, 0.50%, 7/15/25	United States		648,000			635,445
bPRA Group Inc., senior note, 3.50%, 6/01/23	United States		1,295,000			1,546,955
						7,671,790
Diversified Consumer Services 0.3%
fChegg Inc., senior note, 144A, zero cpn., 9/01/26	United States		1,077,000			1,100,078
fK12 Inc., senior note, 144A, 1.125%, 9/01/27	United States		849,000			858,311
b,fSabre Glbl Inc., senior note, 144A, 4.00%, 4/15/25	United States		778,000			949,176
						2,907,565
Diversified Financial Services 0.1%
Element Fleet Management Corp., sub. note, 4.25%, 6/30/24	Canada		1,142,000	CAD		1,038,162
Diversified Telecommunication Services 0.0%†
iTelecom Italia SpA, senior note, Reg S, 1.125%, 3/26/22	Italy		100,000	EUR		118,288

11

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Convertible Bonds (continued)
Electronic Equipment, Instruments & Components 0.7%
bII-VI Inc., senior note, 0.25%, 9/01/22	United States		1,687,000	$	1,986,637
Knowles Corp., senior note, 3.25%, 11/01/21	United States		1,555,000		1,654,209
bOSI Systems Inc., senior note, 1.25%, 9/01/22	United States		1,450,000		1,460,875
bTTM Technologies Inc., senior note, 1.75%, 12/15/20	United States		1,381,000		1,647,529
bVishay Intertechnology Inc., senior note, 2.25%, 6/15/25	United States		1,554,000		1,519,304
					8,268,554
Energy Equipment & Services 0.1%
Helix Energy Solutions Group Inc., senior note, 6.75%, 2/15/26	United States		1,168,000		1,102,568
SEACOR Holdings Inc., senior bond, 3.25%, 5/15/30	United States		245,000		188,482
					1,291,050
Equity Real Estate Investment Trusts (REITs) 0.4%
e,fColliers International Group Inc., senior sub. note, 144A, 4.00%, 6/01/25	Canada		909,000		1,216,969
b,fIIP Operating Partnership LP, senior note, 144A, 3.75%, 2/21/24	United States		1,705,000		3,301,707
					4,518,676
Food & Staples Retailing 0.1%
fThe Chefs’ Warehouse Inc., senior note, 144A, 1.875%, 12/01/24	United States		1,166,000		870,871
Health Care Equipment & Supplies 0.8%
bCONMED Corp., senior note, 2.625%, 2/01/24	United States		1,037,000		1,216,397
fCryoport Inc., senior note, 144A, 3.00%, 6/01/25	United States		780,000		1,895,084
b,fEnvista Holdings Corp., senior note, 144A, 2.375%, 6/01/25	United States		1,428,000		1,954,401
fIntegra Lifesciences Holdings Corp., senior note, 144A, 0.50%, 8/15/25	United States		1,037,000		985,187
fLivanova USA Inc., senior note, 144A, 3.00%, 12/15/25	United States		59,000		63,470
Nevro Corp., senior note, 2.75%, 4/01/25	United States		724,000		1,110,229
fNuVasive Inc., senior note, 144A,
b1.00%, 6/01/23	United States		1,428,000		1,405,688
0.375%, 3/15/25	United States		88,000		79,534
fVarex Imaging Corp., senior note, 144A, 4.00%, 6/01/25	United States		679,000		572,906
					9,282,896
Health Care Providers & Services 0.2%
f1life Healthcare Inc., senior note, 144A, 3.00%, 6/15/25	United States		1,039,000		1,061,266
b,f Petiq Inc., senior note, 144A, 4.00%, 6/01/26	United States		1,042,000		1,461,197
					2,522,463
Health Care Technology 0.4%
fAllscripts Healthcare Solutions Inc., senior note, 144A, 0.875%, 1/01/27	United States		1,285,000		1,206,182
b,fHealth Catalyst Inc., senior note, 144A, 2.50%, 4/15/25	United States		1,014,000		1,274,194
fTabula Rasa Healthcare Inc., senior sub. note, 144A, 1.75%, 2/15/26	United States		1,689,000		1,702,336
					4,182,712
Hotels, Restaurants & Leisure 0.6%
b,fBloomin’ Brands Inc., senior note, 144A, 5.00%, 5/01/25	United States		1,116,000		1,640,938
bMarriott Vacations Worldwide Corp., senior note, 1.50%, 9/15/22	United States		1,897,000		1,895,895
b,fNCL Corp. Ltd., senior note, 144A,
6.00%, 5/15/24	United States		1,169,000		1,695,398
5.375%, 8/01/25	United States		1,298,000		1,501,112
b,fRoyal Caribbean Cruises Ltd., senior note, 144A, 4.25%, 6/15/23	United States		518,000		631,582
					7,364,925
Interactive Media & Services 0.1%
Zillow Group Inc., senior note, 1.50%, 7/01/23	United States		1,284,000		1,651,656

12

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Convertible Bonds (continued)
Internet & Direct Marketing Retail 0.1%
b,fWayfair Inc., senior note, 144A, 0.625%, 10/01/25	United States		1,295,000	$	1,335,564
IT Services 0.8%
bCSG Systems International Inc., senior bond, 4.25%, 3/15/36	United States		1,918,000		2,013,343
bKBR Inc., senior note, 2.50%, 11/01/23	United States		1,737,000		2,090,330
b,fMongodb Inc., senior note, 144A, 0.25%, 1/15/26	United States		1,169,000		1,541,619
fOkta Inc., senior note, 144A, 0.375%, 6/15/26	United States		1,037,000		1,197,837
fPerficient Inc., senior note, 144A, 1.25%, 8/01/25	United States		1,556,000		1,678,114
fSquare Inc., senior note, 144A, 0.125%, 3/01/25	United States		141,000		214,803
					8,736,046
Machinery 0.3%
b,fChart Industries Inc., senior sub. note, 144A, 1.00%, 11/15/24	United States		909,000		1,213,674
Fortive Corp., senior note, 0.875%, 2/15/22	United States		649,000		650,646
The Greenbrier Cos. Inc., senior note, 2.875%, 2/01/24	United States		824,000		750,652
b,fThe Middleby Corp., senior note, 144A, 1.00%, 9/01/25	United States		1,036,000		1,074,587
					3,689,559
Media 1.3%
fCinemark Holdings Inc., senior note, 144A, 4.50%, 8/15/25	United States		708,000		912,009
DISH Network Corp., senior bond, 3.375%, 8/15/26	United States		325,000		321,352
fLiberty Broadband Corp., senior bond, 144A, 2.75%, 9/30/50	United States		281,000		299,427
Liberty Interactive LLC,
senior bond, 4.00%, 11/15/29	United States		1,534,000		1,135,160
senior note, 3.75%, 2/15/30	United States		642,000		473,475
bLiberty Latin America Ltd., senior note, 2.00%, 7/15/24	Chile		1,219,000		1,031,579
Liberty Media Corp.,
fsenior bond, 144A, 2.125%, 3/31/48	United States		1,035,000		1,039,346
b,fsenior bond, 144A, 2.25%, 12/01/48	United States		2,726,000		2,988,010
b,fsenior bond, 144A, 2.75%, 12/01/49	United States		1,556,000		1,542,294
senior note, 1.00%, 1/30/23	United States		1,036,000		1,274,396
Live Nation Entertainment Inc., senior note,
b2.50%, 3/15/23	United States		1,686,000		1,894,642
f144A, 2.00%, 2/15/25	United States		1,038,000		939,390
b,fSnap Inc., senior note, 144A, 0.25%, 5/01/25	United States		1,192,000		1,528,036
					15,379,116
Metals & Mining 0.2%
Cleveland-Cliffs Inc., senior note, 1.50%, 1/15/25	United States		41,000		41,834
fEndeavour Mining Corp., senior note, 144A, 3.00%, 2/15/23	Ivory Coast		389,000		501,343
bPretium Resources Inc., senior sub. note, 2.25%, 3/15/22	Canada		1,037,000		1,124,938
fU.S. Steel Corp., senior note, 144A, 5.00%, 11/01/26	United States		121,000		99,003
					1,767,118
Mortgage Real Estate Investment Trusts (REITs) 0.5%
b,fArbor Realty Trust Inc., senior note, 144A, 4.75%, 11/01/22	United States		1,737,000		1,659,921
Hannon Armstrong Sustainable Infrastructure Capital Inc., senior note, zero cpn., 8/15/23	United States		687,000		727,338
b,fPennyMac Corp., senior note, 144A, 5.50%, 11/01/24	United States		1,578,000		1,485,597
Redwood Trust Inc., senior note,
4.75%, 8/15/23	United States		2,207,000		2,018,791
5.625%, 7/15/24	United States		259,000		236,434
					6,128,081
Oil, Gas & Consumable Fuels 0.2%
bShip Finance International Ltd., senior note, 5.75%, 10/15/21	Norway		1,847,000		1,784,383
Personal Products 0.2%
bHerbalife Nutrition Ltd., senior note, 2.625%, 3/15/24	United States		2,424,000		2,510,582
Pharmaceuticals 1.2%
fAerie Pharmaceuticals Inc., senior note, 144A, 1.50%, 10/01/24	United States		1,482,000		1,173,559
b,fAphria Inc., senior note, 144A, 5.25%, 6/01/24	Canada		2,280,000		1,767,000

13

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*			Value
Convertible Bonds (continued)
Pharmaceuticals (continued)
bAurora Cannabis Inc., senior note, 5.50%, 2/28/24	Canada		3,238,000		$	1,649,356
b,fAvadel Finance Cayman Ltd., senior note, 144A, 4.50%, 2/01/23	United States		1,298,000			1,327,284
fCanopy Growth Corp., senior note, 144A, 4.25%, 7/15/23	Canada		2,138,000	CAD		1,426,044
Collegium Pharmaceutical Inc., senior note, 2.625%, 2/15/26	United States		1,039,000			989,961
bInnoviva Inc., sub. note, 2.125%, 1/15/23	United States		1,775,000			1,730,897
b,fJazz Investments I Ltd., senior note, 144A, 2.00%, 6/15/26	United States		1,300,000			1,478,750
Omeros Corp., senior note, 5.25%, 2/15/26	United States		140,000			130,329
fRevance Therapeutics Inc., senior note, 144A, 1.75%, 2/15/27	United States		1,104,000			1,244,213
eTheravance Biopharma Inc., senior note, 3.25%, 11/01/23	United States		394,000			371,988
Tilray Inc., senior note, 5.00%, 10/01/23	Canada		1,514,000			704,010
						13,993,391
Professional Services 0.1%
FTI Consulting Inc., senior note, 2.00%, 8/15/23	United States		1,036,000			1,340,786
Real Estate Management & Development 0.3%
bRedfin Corp., senior note, 1.75%, 7/15/23	United States		1,361,000			2,264,004
fTricon Residential Inc., senior sub. note, 144A, 5.75%, 3/31/22	Canada		1,089,000			1,133,104
						3,397,108
Semiconductors & Semiconductor Equipment 0.6%
fImpinj Inc., senior note, 144A, 2.00%, 12/15/26	United States		832,000			786,790
Rambus Inc., senior note, 1.375%, 2/01/23	United States		1,296,000			1,338,504
b,fSilicon Laboratories Inc., senior note, 144A, 0.625%, 6/15/25	United States		1,037,000			1,149,645
fSMART Global Holdings Inc., senior note, 144A, 2.25%, 2/15/26	United States		1,295,000			1,164,723
bSynaptics Inc., senior note, 0.50%, 6/15/22	United States		1,559,000			1,993,995
						6,433,657
Software 2.4%
b8x8 Inc., senior note, 0.50%, 2/01/24	United States		1,072,000			1,020,700
bAlteryx Inc., senior note, 0.50%, 8/01/24	United States		1,036,000			1,054,556
bAvaya Holdings Corp., senior note, 2.25%, 6/15/23	United States		1,797,000			1,672,245
b,fCoupa Software Inc., senior note, 144A, 0.375%, 6/15/26	United States		1,036,000			1,360,583
fCyberArk Software Ltd., senior note, 144A, zero cpn., 11/15/24	United States		648,000			652,208
bEnvestnet Inc., senior note,
1.75%, 6/01/23	United States		1,103,000			1,488,505
f144A, 0.75%, 8/15/25	United States		1,036,000			1,088,107
b,fEverbridge Inc., senior note, 144A, 0.125%, 12/15/24	United States		1,116,000			1,641,611
FireEye Inc., senior note, 0.875%, 6/01/24	United States		649,000			639,845
b,fFive9 Inc., senior note, 144A, 0.50%, 6/01/25	United States		1,166,000			1,406,783
fI3 Verticals LLC, senior note, 144A, 1.00%, 2/15/25	United States		1,193,000			1,080,411
fJ2 Global Inc., senior note, 144A, 1.75%, 11/01/26	United States		778,000			697,889
bLivePerson Inc., senior note, 0.75%, 3/01/24	United States		1,695,000			2,833,426
fNice Ltd., senior note, 144A, zero cpn., 9/15/25	Israel		227,000			231,290
bNuance Communications Inc., senior bond, 1.00%, 12/15/35	United States		1,166,000			1,567,512
bNutanix Inc., senior note, zero cpn., 1/15/23	United States		1,296,000			1,281,672
b,fPalo Alto Networks Inc., senior note, 144A, 0.375%, 6/01/25	United States		1,037,000			1,135,276
bPluralsight Inc., senior note, 0.375%, 3/01/24	United States		1,037,000			943,899
fPROS Holdings Inc., senior note, 144A, 1.00%, 5/15/24	United States		778,000			713,902
b,fSailPoint Technologies Holding Inc., senior note, 144A, 0.125%, 9/15/24	United States		1,168,000			1,776,573
b,fSlack Technologies Inc., senior note, 144A, 0.50%, 4/15/25	United States		1,037,000			1,348,872
fWorkiva Inc., senior note, 144A, 1.125%, 8/15/26	United States		683,000			701,004
b,fZscaler Inc., senior note, 144A, 0.125%, 7/01/25	United States		1,296,000			1,566,475
						27,903,344
Specialty Retail 0.3%
b,fNational Vision Holdings Inc., senior note, 144A, 2.50%, 5/15/25	United States		1,126,000			1,582,315
b,fRH, senior note, 144A, zero cpn., 9/15/24	United States		1,089,000			1,803,035
						3,385,350

14

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Convertible Bonds (continued)
Technology Hardware, Storage & Peripherals 0.1%
Pure Storage Inc., senior note, 0.125%, 4/15/23	United States		1,685,000	$	1,632,637
Textiles, Apparel & Luxury Goods 0.1%
b,fUnder Armour Inc., senior note, 144A, 1.50%, 6/01/24	United States		1,039,000		1,215,689
Tobacco 0.1%
bTurning Point Brands Inc., senior note, 2.50%, 7/15/24	United States		1,623,000		1,460,533
Trading Companies & Distributors 0.2%
bKaman Corp., senior note, 3.25%, 5/01/24	United States		2,075,000		2,142,770
Total Convertible Bonds (Cost $170,810,042)					183,909,326
Convertible Bonds in Reorganization (Cost $95,307) 0.0%†
Oil, Gas & Consumable Fuels 0.0%†
jChesapeake Energy Corp., senior note, 5.50%, 9/15/26	United States		95,000		4,394
Corporate Bonds and Notes 8.6%
Aerospace & Defense 0.3%
The Boeing Co.,
senior bond, 2.25%, 6/15/26	United States		115,000		112,795
senior bond, 2.95%, 2/01/30	United States		50,000		48,778
senior bond, 3.25%, 2/01/35	United States		5,000		4,691
senior bond, 3.55%, 3/01/38	United States		5,000		4,517
senior bond, 3.50%, 3/01/39	United States		5,000		4,495
senior bond, 3.375%, 6/15/46	United States		10,000		8,500
senior bond, 3.625%, 3/01/48	United States		5,000		4,370
senior bond, 3.75%, 2/01/50	United States		15,000		13,440
senior bond, 5.805%, 5/01/50	United States		230,000		275,390
senior bond, 3.95%, 8/01/59	United States		115,000		106,153
senior note, 5.15%, 5/01/30	United States		230,000		258,010
fBombardier Inc., 144A,
bsenior bond, 6.125%, 1/15/23	Canada		662,000		536,882
senior bond, 7.50%, 3/15/25	Canada		190,000		139,888
bsenior note, 8.75%, 12/01/21	Canada		580,000		554,866
senior note, 6.00%, 10/15/22	Canada		596,000		509,580
Embraer Netherlands Finance BV, senior bond, 5.05%, 6/15/25	Brazil		80,000		76,492
fLeonardo US Holdings Inc., senior bond, 144A, 6.25%, 1/15/40	Italy		236,000		271,400
Spirit Aerosystems Inc.,
senior bond, 4.60%, 6/15/28	United States		20,000		15,750
fsecured note, 144A, 7.50%, 4/15/25	United States		380,000		384,275
fTransDigm Inc., senior secured note, 144A, 6.25%, 3/15/26	United States		280,000		295,810
					3,626,082
Airlines 0.1%
fMileage Plus Holdings LLC / Mileage Plus Intellectual Property Assets Ltd., senior secured note, 144A, 6.50%, 6/20/27	United States		343,000		358,435
Southwest Airlines Co., senior note,
4.75%, 5/04/23	United States		79,000		84,340
5.25%, 5/04/25	United States		235,000		256,753
5.125%, 6/15/27	United States		66,000		72,082
United Airlines Pass-Through Trust, 2019-2, B, 3.50%, 5/01/28	United States		410,000		296,698
					1,068,308
Auto Components 0.5%
b,fDelphi Technologies PLC, senior note, 144A, 5.00%, 10/01/25	United States		4,501,000		5,168,498
Automobiles 0.4%
Ford Motor Co.,
esenior bond, 9.625%, 4/22/30	United States		55,000		72,181
senior note, 8.50%, 4/21/23	United States		220,000		243,540

15

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*			Value
Corporate Bonds and Notes (continued)
Automobiles (continued)
Ford Motor Co., (continued)
senior note, 9.00%, 4/22/25	United States		260,000		$	304,603
Ford Motor Credit Co. LLC, senior note, 1.514%, 2/17/23	United States		110,000	EUR		128,615
General Motors Co., senior note, 6.80%, 10/01/27	United States		40,000			48,938
General Motors Financial Co. Inc., senior note,
kFRN, 1.118%, (3-Month USD LIBOR + 0.85%), 4/09/21	United States		275,000			274,960
iReg S, 1.694%, 3/26/25	United States		430,000	EUR		517,321
iReg S, 2.20%, 4/01/24	United States		405,000	EUR		497,819
fHyundai Capital America, senior note, 144A,
3.95%, 2/01/22	United States		375,000			390,264
2.375%, 2/10/23	United States		170,000			174,666
fNissan Motor Acceptance Corp., senior note, 144A, 3.65%, 9/21/21	United States		375,000			380,034
Toyota Motor Credit Corp., senior note,
3.05%, 1/08/21	United States		325,000			328,132
kFRN, 0.566%, (3-Month USD LIBOR + 0.29%), 10/07/21	United States		415,000			416,178
fVolkswagen Group of America Finance LLC, senior note, 144A,
3.35%, 5/13/25	Germany		200,000			219,986
kFRN, 1.157%, (3-Month USD LIBOR + 0.86%), 9/24/21	Germany		410,000			410,353
						4,407,590
Banks 0.3%
f,lBanco Macro SA, senior note, 144A, 17.50%, 5/08/22	Argentina		1,740,000	ARS		9,114
kCitigroup Inc., senior note, FRN, 0.95%, (SOFR + 0.87%), 11/04/22	United States		205,000			205,982
kMitsubishi UFJ Financial Group Inc., senior note, FRN, 0.895%, (3-Month USD LIBOR + 0.65%), 7/26/21	Japan		380,000			381,690
kPNC Bank NA, senior note, FRN, 0.708%, (3-Month USD LIBOR + 0.45%), 7/22/22	United States		835,000			837,532
f,kStandard Chartered PLC, senior bond, 144A, FRN, 4.644%, (US 5 Year CMT T-Note + 3.85%), 4/01/31	United Kingdom		200,000			235,124
iVTB Bank OJSC Via VTB Capital SA, loan participation, sub. senior note, Reg S, 6.95%, 10/17/22	Russia		759,000			812,836
kWells Fargo & Co., senior note, FRN, 1.183%, (3-Month USD LIBOR + 0.93%), 2/11/22	United States		495,000			496,697
						2,978,975
Beverages 0.0%†
Fomento Economico Mexicano SAB de CV, senior bond, 3.50%, 1/16/50	Mexico		244,000			260,810
Biotechnology 0.0%†
f,kAbbVie Inc., senior note, 144A, FRN, 0.897%, (3-Month USD LIBOR + 0.65%), 11/21/22	United States		415,000			417,181
Building Products 0.0%†
fBuilders FirstSource Inc., senior secured note, 144A, 6.75%, 6/01/27	United States		205,000			224,052
Capital Markets 0.1%
Brixmor Operating Partnership LP, senior bond, 4.05%, 7/01/30	United States		415,000			445,964
eG Global Finance PLC, senior secured note,
f144A, 4.375%, 2/07/25	United Kingdom		100,000	EUR		114,002
f144A, 6.25%, 10/30/25	United Kingdom		144,000	EUR		173,173
iReg S, 6.25%, 10/30/25	United Kingdom		418,000	EUR		502,681
fMSCI Inc., senior bond, 144A, 3.625%, 9/01/30	United States		345,000			362,519
						1,598,339
Commercial Services & Supplies 0.5%
United Rentals North America Inc., senior bond, 4.00%, 7/15/30	United States		715,000			748,069
fVericast Corp., senior note, 144A, 9.25%, 3/01/21	United States		4,993,500			5,040,314
						5,788,383

16

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*			Value
Corporate Bonds and Notes (continued)
Communications Equipment 0.1%
fCommScope Inc., 144A,
senior note, 7.125%, 7/01/28	United States		430,000		$	459,490
senior secured note, 6.00%, 3/01/26	United States		190,000			202,125
fCommScope Technologies LLC, senior bond, 144A, 5.00%, 3/15/27	United States		90,000			89,559
fHTA Group Ltd., senior note, 144A, 7.00%, 12/18/25	Democratic Republic of the Congo		235,000			251,897
iNokia OYJ, E, senior note, Reg S, 2.00%, 3/11/26	Finland		100,000	EUR		126,297
fRiverbed Technology Inc., senior note, 144A, 8.875%, 3/01/23	United States		394,000			277,770
						1,407,138
Construction & Engineering 0.0%†
iGMR Hyderabad International Airport Ltd., senior secured note, Reg S, 5.375%, 4/10/24	India		200,000			195,250
Construction Materials 0.0%†
fStandard Industries Inc., senior bond, 144A, 4.375%, 7/15/30	United States		300,000			318,336
Vulcan Materials Co., senior bond, 3.50%, 6/01/30	United States		55,000			62,301
						380,637
Consumer Finance 0.1%
Ally Financial Inc.,
senior bond, 4.625%, 3/30/25	United States		35,000			38,761
sub. bond, 5.75%, 11/20/25	United States		105,000			117,998
senior note, 5.80%, 5/01/25	United States		295,000			341,368
OneMain Finance Corp.,
senior bond, 5.375%, 11/15/29	United States		60,000			64,050
senior note, 8.875%, 6/01/25	United States		485,000			547,735
senior note, 6.625%, 1/15/28	United States		45,000			51,444
						1,161,356
Containers & Packaging 0.0%†
f,mIntelligent Packaging Ltd. Finco Inc. / Intelligent Packaging Ltd. Co.-Issuer LLC, senior secured note, 144A, 6.00%, 9/15/28	Canada		223,000			228,018
Diversified Consumer Services 0.0%†
fSabre Glbl Inc., senior secured note, 144A, 9.25%, 4/15/25	United States		35,000			39,003
Diversified Financial Services 0.8%
AerCap Ireland Capital DAC/AerCap Global Aviation Trust, senior note,
4.50%, 9/15/23	Ireland		320,000			329,146
6.50%, 7/15/25	Ireland		150,000			163,310
iAmigo Luxembourg SA, senior secured note, Reg S, 7.625%, 1/15/24	United Kingdom		100,000	GBP		75,833
iFCE Bank PLC, senior note, Reg S,
E, 1.875%, 6/24/21	United Kingdom		255,000	EUR		303,203
E, 0.869%, 9/13/21	United Kingdom		395,000	EUR		466,108
fFinanciera de Desarrollo Territorial SA Findeter, senior bond, 144A, 7.875%, 8/12/24	Colombia		795,000,000	COP		226,509
i,kGarfunkelux Holdco 3 SA, senior secured note, FRN, Reg S, 4.50%, (3-Month EURIBOR + 4.50%), 9/01/23	Luxembourg		100,000	EUR		110,907
fLadder Capital Finance Holdings LLLP / Ladder Capital Finance Corp., senior note, 144A,
5.25%, 3/15/22	United States		45,000			44,690
5.25%, 10/01/25	United States		120,000			114,225
4.25%, 2/01/27	United States		445,000			409,400
iMDC-GMTN BV, senior bond, Reg S, 4.50%, 11/07/28	United Arab Emirates		261,000			315,058
fOne Call Corp., senior secured note, first lien, 144A, 7.50%, 7/01/24	United States		4,092,583			3,990,269

17

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*			Value
Corporate Bonds and Notes (continued)
Diversified Financial Services (continued)
fQuicken Loans Inc., senior bond, 144A, 5.25%, 1/15/28	United States		520,000		$	555,963
b,fRefinitiv U.S. Holdings Inc., senior note, 144A, 8.25%, 11/15/26	United States		1,411,000			1,564,446
						8,669,067
Diversified Telecommunication Services 0.4%
fCincinnati Bell Inc., senior note, 144A, 8.00%, 10/15/25	United States		3,855,000			4,134,661
eConsolidated Communications Inc., senior note, 6.50%, 10/01/22	United States		506,000			496,196
fKenbourne Invest SA, senior note, 144A, 6.875%, 11/26/24	Chile		200,000			208,938
						4,839,795
Electric Utilities 0.4%
b,dBruce Mansfield Escrow, senior bond, zero cpn., 6/01/34	United States		6,394,000			23,977
fEnel SpA, sub. bond, 144A, 8.75% to 9/24/23, FRN thereafter, 9/24/73	Italy		200,000			235,210
iEskom Holdings SOC Ltd., senior bond, Reg S,
5.75%, 1/26/21	South Africa		1,117,000			1,095,593
8.45%, 8/10/28	South Africa		1,334,000			1,290,772
fIpalco Enterprises Inc., senior secured bond, 144A, 4.25%, 5/01/30	United States		30,000			33,634
Pacific Gas & Electric Co.,
bsecured bond, 4.55%, 7/01/30	United States		261,000			288,900
secured bond, 3.50%, 8/01/50	United States		200,000			187,500
bsenior bond, 4.75%, 2/15/44	United States		541,000			569,950
fVistra Operations Co. LLC, senior secured note, 144A, 3.70%, 1/30/27	United States		680,000			714,541
						4,440,077
Electronic Equipment, Instruments & Components 0.0%†
CDW LLC / CDW Finance Corp., senior note, 4.125%, 5/01/25	United States		115,000			120,134
Energy Equipment & Services 0.1%
fTransocean Inc., senior note, 144A,
7.50%, 1/15/26	United States		1,345,000			430,400
8.00%, 2/01/27	United States		100,000			31,125
						461,525
Equity Real Estate Investment Trusts (REITs) 0.3%
American Tower Corp., senior bond, 2.10%, 6/15/30	United States		175,000			178,908
Crown Castle International Corp., senior bond, 2.25%, 1/15/31	United States		540,000			552,970
Equinix Inc., senior bond,
3.20%, 11/18/29	United States		50,000			55,240
2.15%, 7/15/30	United States		260,000			266,882
fIron Mountain Inc., 144A,
senior bond, 5.25%, 7/15/30	United States		210,000			223,265
senior note, 5.00%, 7/15/28	United States		210,000			218,139
bUniti Group LP / Uniti Group Finance Inc. / CSL Capital LLC, senior note, 8.25%, 10/15/23	United States		2,136,000			2,119,980
						3,615,384
Food & Staples Retailing 0.0%†
i,k,nCasino Guichard Perrachon SA, E, junior sub. bond, FRN, Reg S, 3.992%, (EUR 5 Year Swap + 3.82%), Perpetual	France		500,000	EUR		252,197
fRite AID Corp., senior secured note, 144A, 8.00%, 11/15/26	United States		77,000			78,347
						330,544
Food Products 0.0%†
Kraft Heinz Foods Co., senior bond,
5.00%, 6/04/42	United States		45,000			49,709
4.375%, 6/01/46	United States		95,000			97,162
f144A, 4.875%, 10/01/49	United States		150,000			164,904
fLamb Weston Holdings Inc., senior note, 144A, 4.875%, 5/15/28	United States		50,000			55,114
						366,889

18

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Corporate Bonds and Notes (continued)
Health Care Providers & Services 0.1%
CVS Health Corp., senior note, 2.125%, 6/01/21	United States		400,000	$	405,057
Tenet Healthcare Corp.,
secured note, 5.125%, 5/01/25	United States		20,000		20,425
fsecured note, 144A, 6.25%, 2/01/27	United States		35,000		36,799
fsenior secured note, 144A, 4.875%, 1/01/26	United States		45,000		46,856
fsenior secured note, 144A, 4.625%, 6/15/28	United States		130,000		135,176
					644,313
Hotels, Restaurants & Leisure 0.3%
f1011778 BC ULC/New Red Finance Inc., secured note, 144A, 4.375%, 1/15/28	Canada		345,000		355,070
fGolden Nugget Inc., senior note, 144A, 6.75%, 10/15/24	United States		2,660,000		2,277,625
Hyatt Hotels Corp.,
senior bond, 5.75%, 4/23/30	United States		95,000		109,044
senior note, 5.375%, 4/23/25	United States		50,000		54,176
Marriott International Inc.,
senior bond, 4.625%, 6/15/30	United States		75,000		82,227
senior note, EE, 5.75%, 5/01/25	United States		45,000		50,571
fRoyal Caribbean Cruises Ltd., 144A,
senior note, 9.125%, 6/15/23	United States		314,000		330,877
senior secured note, 11.50%, 6/01/25	United States		212,000		245,999
fWyndham Destinations Inc., senior secured note, 144A, 6.625%, 7/31/26	United States		110,000		116,737
					3,622,326
Household Durables 0.1%
fK. Hovnanian Enterprises Inc., senior secured note, 144A, 10.00%, 11/15/25	United States		703,000		455,193
Independent Power & Renewable Electricity Producers 0.0%†
The AES Corp.,
senior bond, 5.50%, 4/15/25	United States		45,000		46,494
fsenior secured bond, 144A, 3.95%, 7/15/30	United States		75,000		81,313
senior note, 6.00%, 5/15/26	United States		15,000		15,785
NRG Energy Inc.,
fsenior bond, 144A, 5.25%, 6/15/29	United States		45,000		49,154
senior note, 5.75%, 1/15/28	United States		20,000		21,796
					214,542
Industrial Conglomerates 0.1%
General Electric Co., senior bond,
3.625%, 5/01/30	United States		110,000		113,468
4.35%, 5/01/50	United States		50,000		50,887
Icahn Enterprises LP / Icahn Enterprises Finance Corp., senior note,
4.75%, 9/15/24	United States		445,000		460,159
6.25%, 5/15/26	United States		85,000		90,936
5.25%, 5/15/27	United States		265,000		282,391
					997,841
Insurance 0.1%
American International Group Inc., senior bond, 4.375%, 6/30/50	United States		375,000		443,456
b,kGenworth Holdings Inc., senior bond, FRN, 2.283%, (3-Month USD LIBOR + 2.00%), 11/15/36	United States		1,623,000		576,165
fGlobal Atlantic Finance Co., senior bond, 144A, 4.40%, 10/15/29	United States		75,000		78,027
f,kNew York Life Global Funding, secured note, 144A, FRN, 0.569%, (3-Month USD LIBOR + 0.32%), 8/06/21	United States		380,000		381,149
					1,478,797
Internet & Direct Marketing Retail 0.1%
Booking Holdings Inc.,
senior bond, 4.625%, 4/13/30	United States		230,000		277,998

19

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Corporate Bonds and Notes (continued)
Internet & Direct Marketing Retail (continued)
Booking Holdings Inc., (continued)
senior note, 4.50%, 4/13/27	United States		145,000	$	170,927
eBay Inc., senior bond, 4.00%, 7/15/42	United States		15,000		16,618
Expedia Group Inc., senior note,
3.25%, 2/15/30	United States		325,000		307,636
f144A, 6.25%, 5/01/25	United States		315,000		346,360
144A, 7.00%, 5/01/25	United States		160,000		174,068
144A, 4.625%, 8/01/27	United States		115,000		120,088
					1,413,695
IT Services 0.0%†
b,fGTT Communications Inc., senior note, 144A, 7.875%, 12/31/24	United States		1,038,000		394,326
Marine 0.0%†
fStena International SA, senior secured bond, 144A, 5.75%, 3/01/24	Sweden		299,000		286,635
Media 0.4%
fCCO Holdings LLC / CCO Holdings Capital Corp., senior bond, 144A,
4.50%, 8/15/30	United States		130,000		138,126
4.25%, 2/01/31	United States		850,000		889,191
fCedar Fair LP / Canada’s Wonderland Co. / Magnum Management Corp. / Millennium Op, senior secured note, 144A, 5.50%, 5/01/25	United States		146,000		150,927
fClear Channel Worldwide Holdings Inc., senior secured note, 144A, 5.125%, 8/15/27	United States		195,000		197,252
fCSC Holdings LLC, senior bond, 144A,
4.125%, 12/01/30	United States		305,000		316,895
4.625%, 12/01/30	United States		610,000		624,698
fGE Capital Funding LLC, senior note, 144A, 4.40%, 5/15/30	United States		415,000		437,932
iHeartCommunications Inc.,
senior note, 8.375%, 5/01/27	United States		760,000		765,179
esenior secured note, 6.375%, 5/01/26	United States		40,000		41,689
fsenior secured note, 144A, 5.25%, 8/15/27	United States		75,000		74,939
fsenior secured note, 144A, 4.75%, 1/15/28	United States		175,000		167,876
Netflix Inc., senior bond,
4.875%, 4/15/28	United States		20,000		23,183
f144A, 4.875%, 6/15/30	United States		45,000		52,234
fOutfront Media Capital LLC / Outfront Media Capital Corp., senior bond, 144A, 4.625%, 3/15/30	United States		65,000		62,969
fSirius XM Radio Inc., 144A,
senior bond, 5.00%, 8/01/27	United States		145,000		154,011
senior bond, 5.50%, 7/01/29	United States		15,000		16,507
senior note, 4.625%, 7/15/24	United States		35,000		36,444
fVirgin Media Secured Finance PLC, senior secured bond, 144A, 5.50%, 8/15/26	United Kingdom		200,000		211,250
					4,361,302
Metals & Mining 0.1%
fCSN Islands XI Corp., senior note, 144A, 6.75%, 1/28/28	Brazil		414,000		397,655
fFirst Quantum Minerals Ltd., senior note, 144A, 6.875%, 3/01/26	Zambia		200,000		200,463
Freeport-McMoRan Inc.,
senior bond, 4.625%, 8/01/30	United States		95,000		101,699
senior note, 4.375%, 8/01/28	United States		135,000		142,086
fNewcrest Finance Pty Ltd., senior bond, 144A, 3.25%, 5/13/30	Australia		85,000		93,976
Reliance Steel & Aluminum Co., senior bond, 2.15%, 8/15/30	United States		25,000		24,804
Steel Dynamics Inc., senior bond, 3.25%, 1/15/31	United States		140,000		150,640
fU.S. Steel Corp., senior secured note, 144A, 12.00%, 6/01/25	United States		334,000		354,545
				1,465,868

20

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*			Value
Corporate Bonds and Notes (continued)
Multiline Retail 0.0%†
Dollar General Corp., senior bond, 3.50%, 4/03/30	United States		55,000		$	63,201
Kohl’s Corp., senior note, 9.50%, 5/15/25	United States		146,000			175,932
						239,133
Oil, Gas & Consumable Fuels 1.1%
fAKER BP ASA, senior bond, 144A, 3.75%, 1/15/30	Norway		350,000			349,459
fCheniere Corpus Christi Holdings LLC, senior secured bond, 144A, 3.70%, 11/15/29	United States		335,000			353,850
Energy Transfer Operating LP, senior bond, 5.00%, 5/15/50	United States		205,000			196,616
Hurricane Finance PLC, senior note, 8.00%, 10/15/25	United Kingdom		158,000			225,200
Kinder Morgan Inc., senior bond, 5.05%, 2/15/46	United States		40,000			47,295
iLeviathan Bond Ltd., senior note, Reg S,
6.125%, 6/30/25	Israel		135,000			140,833
6.50%, 6/30/27	Israel		515,785			539,018
6.75%, 6/30/30	Israel		220,067			229,981
fMoss Creek Resources Holdings Inc., senior note, 144A,
7.50%, 1/15/26	United States		8,000			5,508
10.50%, 5/15/27	United States		496,000			353,023
Petrobras Global Finance BV,
senior bond, 6.90%, 3/19/49	Brazil		797,000			921,105
senior bond, 6.75%, 6/03/50	Brazil		108,000			120,591
senior note, 8.75%, 5/23/26	Brazil		1,055,000			1,335,498
Petroleos Mexicanos,
senior bond, 6.625%, 6/15/35	Mexico		380,000			336,055
senior bond, 6.375%, 1/23/45	Mexico		1,018,000			837,941
senior bond, 6.75%, 9/21/47	Mexico		1,710,000			1,430,723
senior bond, 6.35%, 2/12/48	Mexico		1,489,000			1,202,770
fsenior bond, 144A, 5.95%, 1/28/31	Mexico		1,204,000			1,089,198
fsenior bond, 144A, 6.95%, 1/28/60	Mexico		415,000			345,944
senior note, 3.50%, 1/30/23	Mexico		959,000			955,078
senior note, 4.50%, 1/23/26	Mexico		288,000			269,816
Qep Resources Inc.,
senior bond, 5.375%, 10/01/22	United States		158,000			138,805
senior bond, 5.25%, 5/01/23	United States		451,000			370,948
senior note, 5.625%, 3/01/26	United States		166,000			107,179
fSabine Pass Liquefaction LLC, senior secured bond, 144A, 4.50%, 5/15/30	United States		270,000			309,571
fYPF Sociedad Anonima, senior bond, 144A, 6.95%, 7/21/27	Argentina		105,000			77,385
						12,289,390
Paper & Forest Products 0.0%†
fPaper Industries Intermediate Financing SARL, senior secured note, 144A, 6.00%, 3/01/25	Luxembourg		76,000			69,381
Pharmaceuticals 0.2%
Bausch Health Cos. Inc., senior note,
f144A, 6.25%, 2/15/29	United States		325,000			340,207
iReg S, 4.50%, 5/15/23	United States		305,000	EUR		364,054
iTeva Pharmaceutical Finance Netherlands II BV, senior note, Reg S, 6.00%, 1/31/25	Israel		335,000	EUR		427,237
Teva Pharmaceutical Finance Netherlands III BV,
senior bond, 3.15%, 10/01/26	Israel		220,000			202,746
senior bond, 4.10%, 10/01/46	Israel		1,145,000			982,696
fsenior note, 144A, 7.125%, 1/31/25	Israel		200,000			216,838
fUpjohn Inc., senior bond, 144A, 4.00%, 6/22/50	United States		180,000			196,690
						2,730,468
Road & Rail 0.2%
fAviation Capital Group LLC, senior note, 144A, 5.50%, 12/15/24	United States		165,000			169,842

21

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Corporate Bonds and Notes (continued)
Road & Rail (continued)
fAvis Budget Car Rental LLC / Avis Budget Finance Inc., 144A,
senior bond, 5.25%, 3/15/25	United States		17,000	$	16,284
senior note, 6.375%, 4/01/24	United States		100,000		98,365
fPenske Truck Leasing Co. LP / PTL Finance Corp., senior note, 144A, 3.65%, 7/29/21	United States		285,000		292,532
fUber Technologies Inc., senior note, 144A,
7.50%, 5/15/25	United States		295,000		310,045
8.00%, 11/01/26	United States		1,085,000		1,150,740
7.50%, 9/15/27	United States		290,000		304,384
					2,342,192
Semiconductors & Semiconductor Equipment 0.2%
Broadcom Corp. / Broadcom Cayman Finance Ltd., senior note, 3.875%, 1/15/27	United States		10,000		11,090
Broadcom Inc.,
senior bond, 4.15%, 11/15/30	United States		5,000		5,635
senior bond, 4.30%, 11/15/32	United States		490,000		566,161
senior note, 4.75%, 4/15/29	United States		405,000		474,088
senior note, 5.00%, 4/15/30	United States		135,000		160,696
Micron Technology Inc., senior bond,
5.327%, 2/06/29	United States		385,000		460,292
4.663%, 2/15/30	United States		30,000		34,884
fNXP BV / NXP Funding LLC / NXP USA Inc., 144A,
senior bond, 3.40%, 5/01/30	Netherlands		25,000		27,734
senior note, 3.15%, 5/01/27	Netherlands		40,000		43,756
					1,784,336
Specialty Retail 1.0%
Autonation Inc., senior bond, 4.75%, 6/01/30	United States		40,000		46,933
fCarvana Co., senior note, 144A, 8.875%, 10/01/23	United States		740,000		777,148
L Brands Inc.,
senior bond, 5.625%, 2/15/22	United States		30,000		30,892
bsenior bond, 6.875%, 11/01/35	United States		2,913,000		2,986,408
bsenior note, 7.50%, 6/15/29	United States		735,000		784,017
fVericast Corp./Harland Clarke, senior secured note, 144A, 12.50%, 5/01/24	United States		7,257,934		7,475,672
					12,101,070
Technology Hardware Storage & Peripheral 0.0%†
fSeagate HDD Cayman, senior bond, 144A, 4.125%, 1/15/31	United States		80,000		86,698
Textiles Apparel & Luxury Goods 0.0%†
Levi Strauss & Co., senior note, 5.00%, 5/01/25	United States		290,000		297,582
Trading Companies & Distributors 0.1%
Air Lease Corp., senior note, 3.375%, 7/01/25	United States		210,000		213,941
Aircastle Ltd., senior note, 4.25%, 6/15/26	United States		310,000		289,731
					503,672
Transportation Infrastructure 0.0%†
fAdani Ports & Special Economic Zone Ltd., senior note, 144A, 4.20%, 8/04/27	India		200,000		205,507
Wireless Telecommunication Services 0.1%
fT-Mobile USA Inc., senior secured bond, 144A, 3.875%, 4/15/30	United States		550,000		629,288
Total Corporate Bonds and Notes (Cost $94,998,217)					100,406,590
Corporate Bonds and Notes in Reorganization 0.5%
Diversified Telecommunication Services 0.4%
jFrontier Communications Corp.,
senior bond, 7.125%, 1/15/23	United States		70,000		28,919

22

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Corporate Bonds and Notes in Reorganization (continued)
Diversified Telecommunication Services (continued)
j Frontier Communications Corp., (continued)
senior bond, 6.875%, 1/15/25	United States		33,000	$	13,282
senior bond, 9.00%, 8/15/31	United States		276,000		114,031
fsenior secured note, 144A, 8.00%, 4/01/27	United States		2,384,000		2,399,687
f,j Intelsat Jackson Holdings SA, senior secured note, first lien, 144A, 9.50%, 9/30/22	Luxembourg		2,151,000		2,346,773
				4,902,692
Equity Real Estate Investment Trusts (REITs) 0.0%†
d,f,j Neiman Marcus Group Ltd. LLC / Neiman Marcus Group LLC / Mariposa Borrower, secured note, 144A, 8.00%, 10/25/24	United States		718,000		46,670
Oil, Gas & Consumable Fuels 0.0%†
f,j Lonestar Resources America Inc., senior note, 144A, 11.25%, 1/01/23	United States		95,000		16,150
j Whiting Petroleum Corp., senior note, 6.625%, 1/15/26	United States		505,000		119,572
				135,722
Road & Rail 0.1%
j The Hertz Corp., senior note,
6.25%, 10/15/22	United States		546,000		223,524
b,f144A, 5.50%, 10/15/24	United States		950,000		387,177
f144A, 6.00%, 1/15/28	United States		134,000		55,359
				666,060
Total Corporate Bonds and Notes in Reorganization (Cost $6,611,173)					5,751,144
kSenior Floating Rate Interests (Cost $127,649) 0.0%†
Diversified Financial Services 0.0%†
Ziggo BV, Term Loan H, 3.00%, (3-Month EURIBOR + 3.00%), 1/31/29	United States		115,000		134,652
kSenior Floating Rate Interests in Reorganization 0.0%†
Oil, Gas & Consumable Fuels 0.0%†
j California Resources Corp., Initial Term Loan, 5.75%, (1-Month USD LIBOR + 4.75%), 12/31/22	United States		873,000		338,288
d,j Gavilan Resources LLC, Initial Term Loan, second lien, 7.603%, (1-Month USD LIBOR + 8.00%), 3/01/24	United States		200,000		2,500
Total Senior Floating Rate Interests in Reorganization (Cost $1,040,444)					340,788
Foreign Government and Agency Securities 2.1%
k The Export-Import Bank of Korea, senior note, FRN, 0.822%, (3-Month USD LIBOR + 0.53%), 6/25/22	South Korea		215,000		215,593
Government of Argentina,
senior bond, 7.125%, 6/28/17	Argentina		449,000		195,876
senior note, 6.875%, 1/26/27	Argentina		677,000		303,641
senior note, 5.875%, 1/11/28	Argentina		2,240,000		1,004,662
i Government of Bahrain, senior bond, Reg S, 7.00%, 1/26/26	Bahrain		467,000		534,059
Government of Egypt, senior bond,
f144A, 8.15%, 11/20/59	Egypt		215,000		208,991
f144A, 8.875%, 5/29/50	Egypt		1,426,000		1,491,311
iReg S, 8.70%, 3/01/49	Egypt		822,000		850,778
Government of Italy, senior note, 2.375%, 10/17/24	Italy		350,000		362,789
f Government of Jordan, 144A,
senior bond, 5.85%, 7/07/30	Jordan		386,000		391,816
senior note, 4.95%, 7/07/25	Jordan		578,000		578,897

23

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*			Value
Foreign Government and Agency Securities (continued)
Government of Mexico, senior bond,
4.75%, 4/27/32	Mexico		540,000		$	619,380
5.00%, 4/27/51	Mexico		558,000			644,629
iGovernment of Nigeria, senior note, Reg S, 7.625%, 11/21/25	Nigeria		1,251,000			1,332,065
iGovernment of Paraguay, senior bond, Reg S, 4.625%, 1/25/23	Paraguay		2,414,000			2,567,289
Government of Russia,
senior bond, 6225, 7.25%, 5/10/34	Russia		131,836,000	RUB		1,941,094
isenior bond, Reg S, 5.25%, 6/23/47	Russia		800,000			1,090,273
senior note, 6227, 7.40%, 7/17/24	Russia		180,207,000	RUB		2,639,054
senior note, 6229, 7.15%, 11/12/25	Russia		240,745,000	RUB		3,526,030
senior note, 6232, 6.00%, 10/06/27	Russia		155,262,000	RUB		2,137,207
fGovernment of Saudi Arabia, senior bond, 144A,
2.75%, 2/03/32	Saudi Arabia		1,212,000			1,261,932
3.75%, 1/21/55	Saudi Arabia		354,000			385,683
k,lProvincia de Buenos Aires, FRN,
33.367%, (ARS BADLAR + 3.83%), 5/31/22	Argentina		18,295,000	ARS		133,863
iReg S, 33.313%, (ARS BADLAR + 3.75%), 4/12/25	Argentina		3,670,000	ARS		23,709
Total Foreign Government and Agency Securities (Cost $24,365,326)						24,440,621
Asset-Backed Securities and Commercial Mortgage-Backed Securities 7.3%
Airlines 0.0%†
Latam Airlines Pass Through Trust, 2015-1, B, secured note, 4.50%, 11/15/23	Chile		140,703			80,623
Banks 0.0%†
f,l,oBanco Hipotecario SA, senior note, 144A, FRN, 33.625%, (ARS BADLAR + 4.00%), 11/07/22	Argentina		3,160,000	ARS		25,373
Consumer Finance 0.1%
oDiscover Card Execution Note Trust, 2018-A3, A3, FRN, 0.392%, (1-Month USD LIBOR + 0.23%), 12/15/23	United States		345,000			345,831
World Financial Network Credit Card Master Trust, 2019-C, M, 2.71%, 7/15/26	United States		415,000			415,054
						760,885
Diversified Financial Services 5.8%
fAccelerated Assets LLC, 2018-1, B, 144A, 4.51%, 12/02/33	United States		62,468			62,620
oAccredited Mortgage Loan Trust, 2006-2, M2, FRN, 0.465%, (1-Month USD LIBOR + 0.29%), 9/25/36	United States		2,790,000			2,017,602
oACE Securities Corp. Home Equity Loan Trust Series, 2003-FM1, M1, FRN, 1.465%, (1-Month USD LIBOR + 1.29%), 11/25/32	United States		1,585,549			1,592,525
fAdams Outdoor Advertising LP, 2018-1, A, 144A, 4.81%, 11/15/48	United States		183,715			191,261
pAdjustable Rate Mortgage Trust, 2005-5, 3A3, FRN, 3.626%, 9/25/35	United States		152,436			148,846
f,oAGL CLO 3 Ltd., 2020-3A, C, 144A, FRN, 2.425%, (3-Month USD LIBOR + 2.15%), 1/15/33	United States		285,000			275,799
fAIM Aviation Finance Ltd., 2015-1A, B1, 144A, 5.072%, 2/15/40	United States		170,624			57,715
f,oAllegro CLO VI Ltd., 2018-2A, D, 144A, FRN, 3.023%, (3-Month USD LIBOR + 2.75%), 1/17/31	United States		250,000			224,135
Ally Auto Receivables Trust, 2019-4, A3, 1.84%, 6/17/24	United States		390,000			397,758
fAmerican Credit Acceptance Receivables Trust, 2020-3, D, 144A, 2.40%, 6/15/26	United States		200,000			201,030
AmeriCredit Automobile Receivables Trust,
2018-2, D, 4.01%, 7/18/24	United States		155,000			163,672
2018-3, D, 4.04%, 11/18/24	United States		205,000			217,958
2020-2, D, 2.13%, 3/18/26	United States		100,000			101,004

24

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Diversified Financial Services (continued)
f,oAnchorage Capital CLO 9 Ltd., 2019-9A, DR, 144A, FRN, 4.275%, (3-Month USD LIBOR + 4.00%), 7/15/32	United States		450,000	$	443,263
oArgent Securities Inc., 2004-W3, M4, FRN, 4.092%, (1-Month USD LIBOR + 4.58%), 2/25/34	United States		258,604		248,211
fAscentium Equipment Receivables Trust, 2017-2A, C, 144A, 2.87%, 8/10/22	United States		25,000		25,336
fAvis Budget Rental Car Funding Aesop LLC, 2020-2A, B, 144A, 2.96%, 2/20/27	United States		100,000		103,595
f,p,qBANK, 2019-BN21, XF, 144A, IO, FRN, 1.052%, 10/17/52	United States		11,400,000		565,565
f,oBarings CLO Ltd., 2019-4A, C, 144A, FRN, 3.075%, (3-Month USD LIBOR + 2.80%), 1/15/33	United States		400,000		401,342
Barings Euro CLO, 2014-1, BV, 1.90%, 7/15/31	Netherlands		500,000		574,601
Bear Stearns ALT-A Trust, FRN,
p2006-3, 21A1, 3.492%, 5/25/36	United States		1,328,053		1,123,427
o2006-4, 13A1, 0.495%, (1-Month USD LIBOR + 0.32%), 8/25/36	United States		2,599,588		2,355,542
fBlackbird Capital Aircraft Lease Securitization Ltd., 2016-1A, A, 144A, 4.213%, 12/16/41	United States		197,891		170,520
California Republic Auto Receivables Trust, 2018-1, D, 4.33%, 4/15/25	United States		115,000		118,763
f,oCanyon Capital CLO, 2019-2A, E, 144A, FRN, 7.425%, (3-Month USD LIBOR + 7.15%), 10/15/32	United States		250,000		241,805
Carmax Auto Owner Trust,
2018-2, D, 3.99%, 4/15/25	United States		100,000		103,665
2018-4, D, 4.15%, 4/15/25	United States		60,000		62,447
2019-1, A3, 3.05%, 3/15/24	United States		245,000		252,046
f,oCatamaran CLO 2013-1 Ltd., 2017-1A, CR, 144A, FRN, 2.045%, (3-Month USD LIBOR + 1.80%), 1/27/28	United States		250,000		242,615
fChesapeake Funding II LLC, 144A,
o2017-4A, A2, FRN, 0.472%, (1-Month USD LIBOR + 0.31%), 11/15/29	Canada		50,805		50,846
2018-1A, D, 3.92%, 4/15/30	Canada		115,000		116,327
CHL Mortgage Pass-Through Trust,
o2003-15, 1A1, FRN, 0.675%, (1-Month USD LIBOR + 0.50%), 6/25/42	United States		100,657		95,507
d2004-4, M, 5.50%, 5/25/34	United States		1,229,580		860,233
2006-21, A8, 5.75%, 2/25/37	United States		441,887		339,288
p2006-HYB4, 3B, FRN, 4.038%, 6/20/36	United States		1,976,713		1,683,242
fCIG Auto Receivables Trust, 2017-1A, A, 144A, 2.71%, 5/15/23	United States		554		555
fCoinstar Funding LLC, 2017-1A, A2, 144A, 5.216%, 4/25/47	United States		237,038		225,353
f,oConnecticut Avenue Securities Trust, 2020-R01, 1M2, 144A, FRN, 2.225%, (1-Month USD LIBOR + 2.05%), 1/25/40	United States		85,000		82,646
fCoreVest American Finance Trust, 2019-2, B, 144A, 3.424%, 6/15/52	United States		100,000		103,099
fCPS Auto Receivables Trust, 2018-D, C, 144A, 3.83%, 9/15/23	United States		100,000		101,968
fCSMC Trust, 144A,
2018-RPL2, A1, 4.309%, 8/25/62	United States		184,901		186,590
p2019-RP10, A1, FRN, 3.116%, 12/26/59	United States		161,122		162,241
fDB Master Finance LLC, 2019-1A, A23, 144A, 4.352%, 5/20/49	United States		49,500		54,214
f,pDBUBS Mortgage Trust, 2017-BRBK, D, 144A, FRN, 3.648%, 10/10/34	United States		100,000		103,446
fDomino’s Pizza Master Issuer LLC, 144A,
2017-1A, A23, 4.118%, 7/25/47	United States		165,325		180,426
2018-1A, A2II, 4.328%, 7/25/48	United States		78,400		86,299
2019-1A, A2, 3.668%, 10/25/49	United States		168,725		177,877

25

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*			Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Diversified Financial Services (continued)
Drive Auto Receivables Trust,
2018-1, D, 3.81%, 5/15/24	United States		210,318		$	214,959
2018-3, D, 4.30%, 9/16/24	United States		25,000			26,134
2018-5, D, 4.30%, 4/15/26	United States		125,000			132,351
fDT Auto Owner Trust, 2018-2A, D, 144A, 4.15%, 3/15/24	United States		90,000			92,066
fEducation Funding Trust Trust, 2020-A, A, 144A, 2.79%, 7/25/41	United States		179,818			181,719
f,oExantas Capital Corp. Ltd., 2018-RSO6, D, 144A, FRN, 2.662%, (1-Month USD LIBOR + 2.50%), 6/15/35	United States		1,000,000			967,318
fFairstone Financial Issuance Trust I, 2019-1A, A, 144A, 3.948%, 3/21/33	Canada		150,000	CAD		115,628
pFNMA, 2004-T5, AB7, FRN, 0.672%, 5/28/35	United States		363,417			343,155
fFirst Investors Auto Owner Trust, 2019-2A, D, 144A, 2.80%, 12/15/25	United States		40,000			40,827
fFirstkey Homes Trust, 2020-SFR1, F1, 144A, 3.638%, 9/17/25	United States		225,000			229,583
fFlagship Credit Auto Trust, 144A,
2019-2, D, 3.53%, 5/15/25	United States		165,000			170,310
2019-4, D, 3.12%, 1/15/26	United States		90,000			92,207
2020-1, D, 2.48%, 3/16/26	United States		140,000			140,534
f,oGalaxy XXVI CLO Ltd., 2018-26A, E, 144A, FRN, 6.106%, (3-Month USD LIBOR + 5.85%), 11/22/31	United States		260,000			231,828
fGCAT LLC, 2020-1, A1, 144A, 2.981%, 1/26/60	United States		84,158			82,856
fGLS Auto Receivables Trust, 144A,
2018-3A, B, 3.78%, 8/15/23	United States		70,000			71,278
2019-2A, C, 3.54%, 2/18/25	United States		255,000			264,020
2020-1A, C, 2.72%, 11/17/25	United States		150,000			152,075
2020-3A, C, 1.92%, 5/15/25	United States		330,000			330,730
f,oGPMT Ltd., 144A, FRN,
2018-FL1, C, 2.321%, (1-Month USD LIBOR + 2.15%), 11/19/35	United States		1,250,000			1,189,137
2019-FL2, D, 3.121%, (1-Month USD LIBOR + 2.95%), 2/22/36	United States		1,000,000			930,300
f,oGrand Avenue Cre Ltd., 2020-FL2, C, 144A, FRN, 3.802%, (1-Month USD LIBOR + 3.62%), 3/15/35	United States		1,310,000			1,310,351
i,oGreat Hall Mortgages No 1 PLC, 2006-1, DA, FRN, Reg S, 0.992%, (3-Month GBP LIBOR + 0.82%), 6/18/38	United Kingdom		1,330,000	GBP		1,575,140
oGSAMP Trust, 2006-NC1, M2, FRN, 0.555%, (1-Month USD LIBOR + 0.38%), 2/25/36	United States		2,500,861			2,498,724
f,oGSRPM Mortgage Loan Trust, 2002-1A, M1, 144A, FRN, 2.125%, (1-Month USD LIBOR + 1.95%), 11/25/31	United States		1,017,174			1,009,967
f,oHalcyon Loan Advisors Funding Ltd., 2014-1A, D, 144A, FRN, 3.772%, (3-Month USD LIBOR + 3.50%), 4/18/26	United States		1,490,000			1,371,331
Honda Auto Receivables Owner Trust, 2019-1, A3, 2.83%, 3/20/23	United States		150,000			153,525
fHorizon Aircraft Finance I Ltd., 2018-1, A, 144A, 4.458%, 12/15/38	United States		235,223			224,168
fHPEFS Equipment Trust, 2020-2A, D, 144A, 2.79%, 7/22/30	United States		325,000			329,469
f,oHPLY Trust, 2019-HIT, C, 144A, FRN, 1.762%, (1-Month USD LIBOR + 1.60%), 11/15/36	United States		86,057			80,417
oIXIS Real Estate Capital Trust, 2006-HE2, A3, FRN, 0.335%, (1-Month USD LIBOR + 0.16%), 8/25/36	United States		2,661,609			1,040,702
f,oJFIN CLO Ltd., 2017-1A, DR, 144A, FRN, 2.963%, (3-Month USD LIBOR + 2.65%), 3/15/26	United States		1,530,000			1,367,102
fKestrel Aircraft Funding Ltd., 2018-1A, A, 144A, 4.25%, 12/15/38	United States		218,511			187,523
fLegacy Mortgage Asset Trust, 144A,
2019-GS3, A1, 3.75%, 4/25/59	United States		111,573			114,374
2020-GS1, A1, 2.882%, 10/25/59	United States		259,660			260,414

26

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Diversified Financial Services (continued)
f,oLoanCore Issuer Ltd., 2018-CRE1, D, 144A, FRN, 3.112%, (1-Month USD LIBOR + 2.95%), 5/15/28	United States		1,600,000	$	1,480,406
fMarlette Funding Trust, 144A,
2019-3A, A, 2.69%, 9/17/29	United States		85,266		86,028
2019-4A, B, 2.95%, 12/17/29	United States		290,000		290,861
oMerrill Lynch Mortgage Investors Trust Series, 2007-MLN1, A2D, FRN, 0.495%, (1-Month USD LIBOR + 0.32%), 3/25/37	United States		1,069,348		971,144
Morgan Stanley Mortgage Loan Trust,
p2004-11AR, 2A, FRN, 2.909%, 1/25/35	United States		404,724		388,017
2006-15XS, A3, 5.988%, 11/25/36	United States		2,331,355		885,684
oMortgageit Mortgage Loan Trust, 2006-1, 2A1B, FRN, 0.455%, (1-Month USD LIBOR + 0.28%), 4/25/36	United States		864,941		279,087
f,oMountain View CLO Ltd., 2018-1A, DRR, 144A, FRN, 3.925%, (3-Month USD LIBOR + 3.65%), 10/15/26	United States		2,000,000		1,860,374
fNavient Private Education Refi Loan Trust, 144A,
2019-FA, B, 3.12%, 8/15/68	United States		210,000		213,205
2019-GA, B, 3.08%, 10/15/68	United States		140,000		138,894
f,oNavistar Financial Dealer Note Master Owner Trust II, 2018-1, A, 144A, FRN, 0.805%, (1-Month USD LIBOR + 0.63%), 9/25/23	United States		60,000		59,993
f,oNeuberger Berman CLO XIV Ltd., 2020-14A, CR2, 144A, FRN, 2.147%, (3-Month USD LIBOR + 1.90%), 1/28/30	United States		410,000		399,712
f,oNeuberger Berman Loan Advisers CLO 30 Ltd., 2019-30A, E, 144A, FRN, 7.022%, (3-Month USD LIBOR + 6.75%), 1/20/31	United States		565,000		540,036
f,oNextGear Floorplan Master Owner Trust, 144A, FRN,
2017-2A, A1, 0.842%, (1-Month USD LIBOR + 0.68%), 10/17/22	United States		220,000		219,944
2018-1A, A1, 0.802%, (1-Month USD LIBOR + 0.64%), 2/15/23	United States		500,000		498,730
Nissan Auto Receivables Owner Trust,
2018-A, A3, 2.65%, 5/16/22	United States		113,870		114,708
o2018-C, A2B, FRN, 0.332%, (1-Month USD LIBOR + 0.17%), 10/15/21	United States		25,884		25,885
oNomura Home Equity Loan Inc. Home Equity Loan Trust Series, 2006-WF1, M4, FRN, 0.545%, (1-Month USD LIBOR + 0.37%), 3/25/36	United States		1,299,304		1,169,670
f,oOctagon Investment Partners XXII Ltd., 2018-1A, CRR, 144A, FRN, 2.158%, (3-Month USD LIBOR + 1.90%), 1/22/30	United States		250,000		240,145
fOneMain Financial Issuance Trust, 144A,
2015-3A, B, 4.16%, 11/20/28	United States		155,000		156,900
2020-2A, C, 2.76%, 9/14/35	United States		100,000		101,071
fOxford Finance Funding LLC, 2019-1A, A2, 144A, 4.459%, 2/15/27	United States		50,000		51,464
fPlanet Fitness Master Issuer LLC, 2019-1A, A2, 144A, 3.858%, 12/05/49	United States		149,250		140,703
fPrestige Auto Receivables Trust, 2019-1A, E, 144A, 3.90%, 5/15/26	United States		100,000		98,859
fProgress Residential Trust, 2019-SFR1, E, 144A, 4.466%, 8/17/35	United States		115,000		118,616
RALI Series Trust, 2007-QS2, AP, zero cpn., 1/25/37	United States		189,619		132,388
f,pRBSSP Resecuritization Trust, 2009-12, 17A2, 144A, FRN, 3.581%, 10/25/35	United States		556,611		537,768
fRCO V Mortgage LLC, 2019-1, A1, 144A, 3.721%, 5/24/24	United States		155,390		156,695
f,pReadycap Commercial Mortgage Trust, 2015-2, E, 144A, FRN, 5.127%, 6/25/55	United States		1,590,000		1,395,374
Renaissance Home Equity Loan Trust, 2006-1, AF3, 5.608%, 5/25/36	United States		3,480,438		2,398,816

27

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Diversified Financial Services (continued)
fRepublic Finance Issuance Trust, 2019-A, A, 144A, 3.43%, 11/22/27	United States		240,000	$	240,775
Santander Drive Auto Receivables Trust,
2018-2, D, 3.88%, 2/15/24	United States		275,000		281,502
2018-3, D, 4.07%, 8/15/24	United States		210,000		215,542
2019-2, D, 3.22%, 7/15/25	United States		210,000		216,757
2020-1, D, 5.35%, 3/15/28	United States		230,000		247,342
2020-2, D, 2.22%, 9/15/26	United States		100,000		101,797
oSaxon Asset Securities Trust, 2005-4, M4, FRN, 0.795%, (1-Month USD LIBOR + 0.62%), 11/25/37	United States		2,546,895		1,664,762
fSCF Equipment Leasing LLC, 2018-1A, C, 144A, 4.21%, 4/20/27	United States		255,000		260,569
f,pSecurity National Mortgage Loan Trust, 2004-1A, AF3, 144A, FRN, 6.42%, 6/25/32	United States		1,949,104		1,704,809
f,oSilvermore CLO Ltd., 2014-1A, C, 144A, FRN, 3.73%, (3-Month USD LIBOR + 3.45%), 5/15/26	United States		1,250,000		1,180,480
fS-Jets Ltd., 2017-1, A, 144A, 3.967%, 8/15/42	Bermuda		222,536		201,057
oSLM Private Credit Student Loan Trust, FRN,
2003-B, A3, 1.657%, (28-Day T-Bill + 1.00%), 3/15/33	United States		250,000		242,728
2003-B, A4, 1.657%, (28-Day T-Bill + 1.00%), 3/15/33	United States		50,000		48,750
f,oSMB Private Education Loan Trust, 2017-B, A2B, 144A, FRN, 0.912%, (1-Month USD LIBOR + 0.75%), 10/15/35	United States		73,304		72,704
fSoFi Consumer Loan Program Trust, 144A,
2018-1, B, 3.65%, 2/25/27	United States		100,000		102,937
2019-4, C, 2.84%, 8/25/28	United States		130,000		127,525
fSoFi Professional Loan Program LLC, 2016-A, B, 144A, 3.57%, 1/26/38	United States		49,123		49,979
oSoundview Home Loan Trust, 2006-WF2, M3, FRN, 0.625%, (1-Month USD LIBOR + 0.45%), 12/25/36	United States		1,744,207		1,730,733
fSprite Ltd., 2017-1, B, 144A, 5.75%, 12/15/37	United States		164,302		103,655
fStack Infrastructure Issuer LLC, 2019-1A, A2, 144A, 4.54%, 2/25/44	United States		123,125		131,811
f,oStaniford Street CLO Ltd., 2014-1A, D, 144A, FRN, 3.813%, (3-Month USD LIBOR + 3.50%), 6/15/25	United States		1,650,000		1,627,942
f,oStarwood Retail Property Trust, 2014-STAR, E, 144A, FRN, 4.562%, (1-Month USD LIBOR + 4.40%), 11/15/27	United States		200,000		4,375
fTaco Bell Funding LLC, 2018-1A, A2II, 144A, 4.94%, 11/25/48	United States		186,675		202,754
fTAL Advantage V LLC, 2013-2A, A, 144A, 3.55%, 11/20/38	United States		32,500		32,822
f,oTICP CLO II-2 Ltd., 2018-IIA, C, 144A, FRN, 3.195%, (3-Month USD LIBOR + 2.95%), 4/20/28	United States		1,020,000		956,801
f,pTowd Point Mortgage Trust, 2015-2, 1A13, 144A, FRN, 2.50%, 11/25/60	United States		50,268		50,747
f,oTPG Real Estate Finance Issuer Ltd., 2018-FL2, C, 144A, FRN, 2.462%, (1-Month USD LIBOR + 2.30%), 11/15/37	United States		1,500,000		1,422,750
f,oTRTX Issuer Ltd., 2019-FL3, B, 144A, FRN, 1.912%, (1-Month USD LIBOR + 1.75%), 10/15/34	United States		1,300,000		1,241,589
f,oVERDE CLO Ltd., 2019-1A, E, 144A, FRN, 7.175%, (3-Month USD LIBOR + 6.90%), 4/15/32	United States		340,000		314,932
fVericrest Opportunity Loan Trust, 2019-NPL5, A1A, 144A, 3.352%, 9/25/49	United States		276,994		277,406
f,oVMC Finance LLC, 2019-FL3, C, 144A, FRN, 2.212%, (1-Month USD LIBOR + 2.05%), 9/15/36	United States		549,585		526,435
fVOLT LXXXIII LLC, 2019-NPL9, A1A, 144A, 3.327%, 11/26/49	United States		80,534		80,293
f,pWaMu Commercial Mortgage Securities Trust, 2007-SL2, G, 144A, FRN, 3.609%, 12/27/49	United States		2,866,101		2,130,321

28

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Diversified Financial Services (continued)
pWells Fargo Mortgage Backed Securities Trust, 2007-AR6, A2, FRN, 3.561%, 10/25/37	United States		249,009	$	231,172
fWendy’s Funding LLC, 2018-1A, A2II, 144A, 3.884%, 3/15/48	United States		214,500		226,375
f,oYork CLO-6 Ltd., 2019-1A, D, 144A, FRN, 4.258%, (3-Month USD LIBOR + 4.00%), 7/22/32	United States		455,000		455,339
					68,676,491
Equity Real Estate Investment Trusts (REITs) 0.1%
fAmerican Homes 4 Rent, 144A,
2014-SFR2, E, 6.231%, 10/17/36	United States		250,000		278,580
2014-SFR3, E, 6.418%, 12/17/36	United States		100,000		111,958
2015-SFR1, E, 5.639%, 4/17/52	United States		210,000		231,932
fColony American Finance Ltd., 2015-1, D, 144A, 5.649%, 10/15/47	United States		115,000		116,711
fDiamond Resorts Owner Trust, 144A,
2017-1A, C, 6.07%, 10/22/29	United States		26,737		26,847
2018-1, C, 4.53%, 1/21/31	United States		69,247		68,599
2019-1A, B, 3.53%, 2/20/32	United States		70,678		70,668
					905,295
Hotels, Restaurants & Leisure 0.0%†
fArbys Funding LLC, 2020-1A, A2, 144A, 3.237%, 7/30/50	United States		100,000		103,321
Mortgage Real Estate Investment Trusts (REITs) 1.2%
f,pAjax Mortgage Loan Trust, 2017-B, A, 144A, FRN, 3.163%, 9/25/56	United States		89,931		90,374
oAmerican Home Mortgage Investment Trust, 2006-1, 11A1, FRN, 0.455%, (1-Month USD LIBOR + 0.28%), 3/25/46	United States		198,974		178,228
Banc of America Alternative Loan Trust, 2003-8, 1CB1, 5.50%, 10/25/33	United States		5,439		5,478
Banc of America Funding Trust,
2003-1, B2, 6.00%, 5/20/33	United States		288,712		211,382
2007-4, 5A1, 5.50%, 11/25/34	United States		76,274		76,048
pBanc of America Mortgage Trust, 2005-A, 2A1, FRN, 3.711%, 2/25/35	United States		4,529		4,499
f,oBCAP LLC Trust, 2012-RR4, 9A7, 144A, FRN, 0.252%, (1-Month USD LIBOR + 0.08%), 11/26/36	United States		508,789		475,588
pBear Stearns ARM Trust, 2007-4, 12A1, FRN, 4.024%, 5/25/37	United States		1,775,612		1,694,118
fCitigroup Mortgage Loan Trust, 144A,
p2009-10, 6A2, FRN, 2.743%, 9/25/34	United States		28,169		28,069
p2018-A, A1, FRN, 4.00%, 1/25/68	United States		90,537		91,004
2018-C, A1, 4.125%, 3/25/59	United States		147,256		149,929
p2019-B, A1, FRN, 3.258%, 4/25/66	United States		103,490		104,420
2019-E, A1, 3.228%, 11/25/70	United States		238,706		242,563
Countrywide Alternative Loan Trust,
2003-22CB, 1A1, 5.75%, 12/25/33	United States		35,888		37,526
2004-16CB, 1A1, 5.50%, 7/25/34	United States		22,335		23,185
2004-16CB, 3A1, 5.50%, 8/25/34	United States		22,880		23,779
2004-3T1, M, 6.00%, 5/25/34	United States		255,045		208,388
2004-J10, 2CB1, 6.00%, 9/25/34	United States		64,217		67,744
2005-J1, 2A1, 5.50%, 2/25/25	United States		3,409		3,495
2005-J14, A3, 5.50%, 12/25/35	United States		369,973		303,870
2006-6CB, 2A11, 5.50%, 5/25/36	United States		323,527		198,030
oCountrywide Asset-Backed Certificates, 2005-15, M3, FRN, 0.695%, (1-Month USD LIBOR + 0.52%), 4/25/36	United States		2,340,000		1,965,719
pCountrywide Home Loans Mortgage Pass-Through Trust, 2004-HYB4, 2A1, FRN, 2.919%, 9/20/34	United States		50,254		48,676

29

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*			Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Mortgage Real Estate Investment Trusts (REITs) (continued)
Credit Suisse First Boston Mortgage Securities Corp.,
2002-10, 1B, 7.00%, 5/25/32	United States		153,420		$	136,640
2003-27, 4A4, 5.75%, 11/25/33	United States		17,570			18,522
2005-8, 1A3, 5.25%, 9/25/35	United States		119,442			117,857
fCSMC OA LLC, 144A,
2014-USA, A2, 3.953%, 9/15/37	United States		150,000			150,980
d2014-USA, E, 4.373%, 9/15/37	United States		400,000			246,316
oDSLA Mortgage Loan Trust, 2005-AR5, 2A1A, FRN, 0.491%, (1-Month USD LIBOR + 0.33%), 9/19/45	United States		37,519			28,082
i,oDukinfield II PLC, 2016-2, A, FRN, Reg S, 1.432%, (3-Month GBP LIBOR + 1.25%), 12/20/52	United Kingdom		148,329	GBP		198,808
oFHLMC Structured Agency Credit Risk Debt Notes, FRN,
2015-DNA1, M2, 2.025%, (1-Month USD LIBOR + 1.85%), 10/25/27	United States		14,170			14,175
2015-DNA1, M3, 3.475%, (1-Month USD LIBOR + 3.30%), 10/25/27	United States		250,000			256,319
d,f,pGS Mortgage Securities Trust, 2011-GC5, D, 144A, FRN, 5.555%, 8/10/44	United States		195,000			152,206
GSR Mortgage Loan Trust,
2005-4F, 6A1, 6.50%, 2/25/35	United States		8,573			8,665
p2005-AR6, 4A5, FRN, 3.258%, 9/25/35	United States		43,247			43,056
oHarborview Mortgage Loan Trust, 2004-11, 2A2A, FRN, 0.801%, (1-Month USD LIBOR + 0.64%), 1/19/35	United States		87,490			81,183
IndyMac INDX Mortgage Loan Trust, FRN,
o2004-AR12, A1, 0.955%, (1-Month USD LIBOR + 0.78%), 12/25/34	United States		1,859,285			1,522,827
o2004-AR7, A5, 1.395%, (1-Month USD LIBOR + 1.22%), 9/25/34	United States		45,695			41,914
p2005-AR11, A3, 3.244%, 8/25/35	United States		48,290			42,780
o2006-AR2, 2A1, 0.385%, (1-Month USD LIBOR + 0.21%), 2/25/46	United States		212,311			170,816
f,oInvitation Homes Trust, 144A, FRN,
2018-SFR1, E, 2.162%, (1-Month USD LIBOR + 2.00%), 3/17/37	United States		99,986			99,943
2018-SFR2, E, 2.162%, (1-Month USD LIBOR + 2.00%), 6/17/37	United States		200,000			199,865
pJPMorgan Alternative Loan Trust, 2006-A2, 2A2, FRN, 3.701%, 5/25/36	United States		1,763,471			1,408,014
JPMorgan Mortgage Trust,
2004-S1, 2A1, 6.00%, 9/25/34	United States		89,226			95,087
p2007-A1, 4A2, FRN, 2.962%, 7/25/35	United States		2,487			2,447
oLehman XS Trust Series, 2006-2N, 1A1, FRN, 0.435%, (1-Month USD LIBOR + 0.26%), 2/25/46	United States		38,099			33,661
MASTR Alternative Loan Trust,
2004-2, 8A4, 5.50%, 3/25/34	United States		142,829			146,849
2004-8, 2A1, 6.00%, 9/25/34	United States		42,510			44,169
pMerrill Lynch Mortgage Investors MLCC, 2006-2, 2A, FRN, 3.014%, 5/25/36	United States		2,978			2,939
f,pMorgan Stanley Capital I Trust, 2011-C2, E, 144A, FRN, 5.661%, 6/15/44	United States		150,000			93,027
fPRPM LLC, 2019-4A, A1, 144A, 3.351%, 11/25/24	United States		104,979			105,656
pRFMSI Trust, 2005-SA1, 1A1, FRN, 4.539%, 3/25/35	United States		100,136			67,201
oSecuritized Asset Backed Receivables LLC Trust, 2006-WM4, A2C, FRN, 0.335%, (1-Month USD LIBOR + 0.16%), 11/25/36	United States		3,707,151			1,513,925
oStructured ARM Loan Trust, 2005-14, A1, FRN, 0.485%, (1-Month USD LIBOR + 0.31%), 7/25/35	United States		232,554			169,368

30

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Mortgage Real Estate Investment Trusts (REITs) (continued)
f,pWells Fargo Commercial Mortgage Trust, 2019-JWDR, C, 144A, FRN, 3.139%, 9/15/31	United States		290,000	$	275,522
pWF-RBS Commercial Mortgage Trust, FRN,
f2011-C2, D, 144A, 5.85%, 2/15/44	United States		35,000		34,677
f2011-C3, D, 144A, 5.853%, 3/15/44	United States		90,000		44,558
f2012-C6, D, 144A, 5.766%, 4/15/45	United States		150,000		147,923
2012-C7, C, 4.965%, 6/15/45	United States		25,000		18,071
d,f2012-C7, E, 144A, 4.965%, 6/15/45	United States		75,000		30,725
					13,996,885
Thrifts & Mortgage Finance 0.1%
f,oBX Commercial Mortgage Trust, 2019-XL, E, 144A, FRN, 1.962%, (1-Month USD LIBOR + 1.80%), 10/15/36	United States		1,234,087		1,228,140
Total Asset-Backed Securities and Commercial Mortgage-Backed Securities (Cost $88,446,672)					85,777,013
Municipal Bonds in Reorganization 0.5%
Puerto Rico 0.5%
jPuerto Rico Commonwealth GO, Public  Improvement, Refunding, Series A,
5.50%, 7/01/39	United States		715,000		473,688
5.00%, 7/01/41	United States		1,000,000		626,250
jPuerto Rico Commonwealth GO, Refunding, Series A, 8.00%, 7/01/35	United States		7,155,000		4,373,494
jPuerto Rico Electric Power Authority Power Revenue,
bA-RSA-1, 5.00%, 7/01/42	United States		563,000		388,470
bTT-RSA-1, 5.00%, 7/01/37	United States		295,000		203,550
WW-RSA-1, 5.25%, 7/01/33	United States		10,000		6,912
XX, 5.25%, 7/01/40	United States		40,000		27,650
Total Municipal Bonds in Reorganization (Cost $5,357,012)					6,100,014
	Number of Contracts	Notional Amount#
Options Purchased 0.1%
Calls – Exchange-Traded 0.0%†
Avadel Pharmaceuticals PLC, September Strike Price $10.00, Expires 9/18/20	56		5,600		504
The Chefs’ Warehouse Inc., October Strike Price $17.50, Expires 10/16/20	28		2,800		2,100
DJ EURO STOXX 50 Index, September Strike Price 3,500.00 EUR, Expires 9/18/20	60		600		2,076
DJ EURO STOXX 50 Index, September Strike Price 3,525.00 EUR, Expires 9/18/20	208		2,080		5,213
DJ EURO STOXX Banks, October Strike Price 67.50 EUR, Expires 10/16/20	110		5,500		7,876
DJ EURO STOXX Banks, October Strike Price 70.00 EUR, Expires 10/16/20	110		5,500		4,594
DJ EURO STOXX Banks, December Strike Price 65.00 EUR, Expires 12/18/20	110		5,500		23,300
HP Inc., October Strike Price $17.00, Expires 10/16/20	331		33,100		92,680
HP Inc., October Strike Price $19.00, Expires 10/16/20	97		9,700		13,192
HP Inc., October Strike Price $20.00, Expires 10/16/20	348		34,800		27,492

31

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Number of Contracts	Notional Amount#			Value
Options Purchased (continued)
Calls – Exchange-Traded (continued)
Kansas City Southern, September Strike Price $185.00, Expires 9/18/20	39		3,900		$	21,840
Kansas City Southern, December Strike Price $185.00, Expires 12/18/20	39		3,900			46,800
Karyopharm Therapeutics Inc., September Strike Price $20.00, Expires 9/18/20	28		2,800			140
KBR Inc., September Strike Price $25.00, Expires 9/18/20	50		5,000			3,650
Live Nation Entertainment Inc., October Strike Price $60.00, Expires 10/16/20	43		4,300			13,373
Live Nation Entertainment Inc., October Strike Price $65.00, Expires 10/16/20	34		3,400			5,882
MongoDB Inc., September Strike Price $250.00, Expires 9/18/20	5		500			5,150
S&P 500 Index, December Strike Price $3,400.00, Expires 12/18/20	7		700			169,120
Sabre Corp., October Strike Price $10.00, Expires 10/16/20	56		5,600			1,120
Sabre Corp., October Strike Price $11.00, Expires 10/16/20	56		5,600			560
Slack Technologies Inc., September Strike Price $38.00, Expires 9/18/20	39		3,900			4,758
STOXX Europe 600 Automobiles & Parts Index, December Strike Price 500.00 EUR, Expires 12/18/20	100		5,000			25,657
Taubman Centers Inc., December Strike Price $45.00, Expires 12/18/20	39		3,900			7,410
Vodafone Group PLC, September Strike Price 1.20 GBP, Expires 9/18/20	308		308,000			2,059
						486,546
Calls – Over-the-Counter 0.0%†
Currency Options 0.0%†
EUR/USD, Counterparty JPHQ, September Strike Price $1.16, Expires 9/03/20	1		1,870,000	EUR		57,692
NZD/USD, Counterparty JPHQ, September Strike Price $0.65, Expires 9/02/20	1		3,200,000	NZD		75,521
						133,213
Puts – Exchange-Traded 0.1%
10-Year U.S. Treasury Note Futures, November Strike Price $137.00, Expires 11/20/20	291		291,000			100,031
Bombardier Inc., B, January Strike Price 1.00 CAD, Expires 1/15/21	435		43,500			18,343
DJ EURO STOXX 50 Index, September Strike Price 3,150.00 EUR, Expires 9/18/20	63		630			25,486
Inseego Corp., September Strike Price $7.50, Expires 9/18/20	40		4,000			120
S&P 500 Index, October Strike Price $3,300.00, Expires 10/16/20	10		1,000			48,600
STOXX Europe 600 Food & Beverage Index, December Strike Price 760.00 EUR, Expires 12/18/20	100		5,000			527,459
Tiffany & Co., January Strike Price $85.00, Expires 1/15/21	29		2,900			4,930
Tiffany & Co., January Strike Price $105.00, Expires 1/15/21	29		2,900			11,890
Tiffany & Co., January Strike Price $115.00, Expires 1/15/21	29		2,900			17,980
Tiffany & Co., January Strike Price $120.00, Expires 1/15/21	59		5,900			42,775
Vodafone Group PLC, September Strike Price 1.10 GBP, Expires 9/18/20	530		530,000			17,712
						815,326

32

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Number of Contracts	Notional Amount#			Value
Options Purchased (continued)
Puts - Over-the-Counter 0.0%†
Casino Guichard-Perrachon SA, Counterparty BOFA, December Strike Price 20.00 EUR, Expires 12/18/20	27		2,700		$	5,413
Total Options Purchased (Cost $1,247,923)						1,440,498
Total Investments before Short Term Investments (Cost $715,902,423)						877,649,616
	Country	Principal Amount*
Short Term Investments 24.6%
Convertible Bonds 0.3%
Biotechnology 0.1%
BioMarin Pharmaceutical Inc., senior sub. note, 1.50%, 10/15/20	United States		907,000			910,437
Health Care Equipment & Supplies 0.1%
bNuVasive Inc., senior note, 2.25%, 3/15/21	United States		1,272,000			1,357,860
Software 0.1%
bVerint Systems Inc., senior note, 1.50%, 6/01/21	United States		1,558,000			1,578,501
Total Convertible Bonds (Cost $3,784,216)						3,846,798
Corporate Bonds and Notes (Cost $83,648) 0.0%†
Specialty Retail 0.0%†
L Brands Inc., senior bond, 6.625%, 4/01/21	United States		88,000			90,596
Credit-Linked Notes 0.1%
d,fCitigroup Global Markets Holdings Inc., senior note, (Egypt), 144A, zero cpn., 10/22/20	Egypt		13,921,000	EGP		861,038
f,iHSBC Bank PLC, senior note, (Egypt), 144A, Reg S, zero cpn., 10/15/20	Egypt		6,950,000	EGP		431,514
Total Credit-Linked Notes (Cost $1,283,955)						1,292,552
		Shares
Money Market Funds 20.8%
r,sDreyfus Government Cash Management, Institutional, 0.04%	United States		20,820,559			20,820,559
rFidelity Investments Money Market Government Portfolio, Institutional, 0.01%	United States		223,696,248			223,696,248
Total Money Market Funds (Cost $244,516,807)						244,516,807

33

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount#		Value
Short Term Investments (continued)
Repurchase Agreements (Cost $18,412,797) 1.6%
tJoint Repurchase Agreement, 0.068%, 9/01/20 (Maturity Value $18,412,831)	United States		18,412,797	$	18,412,797
BNP Paribas Securities Corp. (Maturity Value $13,924,703)
Deutsche Bank Securities Inc. (Maturity Value $1,375,623)
HSBC Securities (USA) Inc. (Maturity Value $3,112,505) Collateralized by U.S. Government Agency Securities, 3.00% - 5.00%, 11/20/42 - 7/20/50; U.S. Government Agency Strips, 8/15/22 - 11/15/43; uU.S. Treasury Bills, 1/19/21; and U.S. Treasury Notes, 1.75% , 5/31/22 (valued at $18,791,369)
Investments from Cash Collateral Received for Loaned Securities 0.2%
		Shares
Money Market Funds 0.2%
r,vInstitutional Fiduciary Trust Money Market Portfolio, 0.00%	United States		1,992,000		1,992,000
		Principal Amount*
Repurchase Agreements 0.0%†
tJoint Repurchase Agreement, 0.07%, 9/01/20 (Maturity Value $498,987)	United States		498,986		498,986
J.P. Morgan Securities LLC
Collateralized by uU.S. Treasury Bills, 9/08/20 (valued at $508,967)
Total Investments from Cash Collateral Received for Loaned Securities (Cost $2,490,986)					2,490,986
U.S. Government and Agency Securities 1.6%
uU.S. Treasury Bill, zero cpn.,
b9/24/20	United States		12,700,000		12,699,432
11/19/20	United States		785,000		784,849
11/27/20	United States		1,590,000		1,589,645
12/03/20	United States		850,000		849,781
12/24/20	United States		825,000		824,732
1/07/21	United States		1,235,000		1,234,539
7/15/21	United States		1,280,000		1,278,746
Total U.S. Government and Agency Securities (Cost $19,257,469)					19,261,724
Total Investments (Cost $1,005,732,301) 99.3%					1,167,561,876
Options Written (0.2)%					(1,674,739	)
Securities Sold Short (21.8)%					(256,552,840	)
Other Assets, less Liabilities 22.7%					266,331,459
Net Assets 100.0%				$	1,175,665,756

34

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Number of Contracts	Notional Amount#		Value
Options Written (0.2)%
Calls - Exchange-Traded (0.1)%
10-Year U.S. Treasury Note Futures, November Strike Price $140.50, Expires 11/20/20	97		97,000	$	(48,500	)
Altria Group Inc., October Strike Price $45.00, Expires 10/16/20	1		100		(84	)
Applied Materials Inc., October Strike Price $70.00, Expires 10/16/20	1		100		(83	)
AT&T Inc., October Strike Price $31.00, Expires 10/16/20	2		200		(72	)
Bristol-Myers Squibb Co., October Strike Price $65.00, Expires 10/16/20	1		100		(91	)
Chevron Corp., October Strike Price $97.50, Expires 10/16/20	1		100		(49	)
Citigroup Inc., October Strike Price $55.00, Expires 10/16/20	1		100		(164	)
Comcast Corp., October Strike Price $45.00, Expires 10/16/20	1		100		(150	)
DJ EURO STOXX Banks, December Strike Price 75.00 EUR, Expires 12/18/20	110		5,500		(6,235	)
eBay Inc., October Strike Price $65.00, Expires 10/16/20	1		100		(45	)
E-Mini S&P 500 Futures, September Strike Price $3,200.00, Expires 9/18/20	6		300		(92,940	)
E-Mini S&P 500 Futures, September Strike Price $3,360.00, Expires 9/18/20	14		700		(113,820	)
Enterprise Products Partners LP, October Strike Price $20.00, Expires 10/16/20	4		400		(48	)
HP Inc., October Strike Price $20.00, Expires 10/16/20	3		300		(237	)
The Kroger Co., October Strike Price $39.00, Expires 10/16/20	2		200		(150	)
Livongo Health Inc., November Strike Price $100.00, Expires 11/20/20	42		4,200		(163,800	)
Merck & Co. Inc., October Strike Price $90.00, Expires 10/16/20	1		100		(102	)
MetLife Inc., October Strike Price $42.50, Expires 10/16/20	1		100		(57	)
NASDAQ 100 E-Mini, September Strike Price $10,200.00, Expires 9/18/20	8		160		(309,280	)
NortonLifeLock Inc., October Strike Price $25.00, Expires 10/16/20	2		200		(148	)
Oracle Corp., October Strike Price $60.00, Expires 10/16/20	1		100		(158	)
Principia Biopharma Inc., November Strike Price $100.00, Expires 11/20/20	185		18,500		(6,475	)
PulteGroup Inc., October Strike Price $50.00, Expires 10/16/20	1		100		(85	)
STOXX Europe 600 Food & Beverage Index, December Strike Price 760.00 EUR, Expires 12/18/20	100		5,000		(7,757	)
Tiffany & Co., January Strike Price $130.00, Expires 1/15/21	29		2,900		(7,975	)
Truist Financial Corp., October Strike Price $42.50, Expires 10/16/20	1		100		(95	)
The Williams Cos. Inc., October Strike Price $23.00, Expires 10/16/20	2		200		(40	)
				(758,640)
Calls – Over-the-Counter (0.0)%†
Currency Options (0.0)%†
USD/BRL, Counterparty JPHQ, October Strike Price 4.75 BRL, Expires 10/08/20	1		1,210,000		(162,867	)
USD/ZAR, Counterparty JPHQ, November Strike Price 19.75 ZAR, Expires 11/19/20	1		137,750		(499	)
				(163,366)

35

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Number of Contracts	Notional Amount#			Value
Options Written (continued)
Puts—Exchange-Traded (0.1)%
10-Year U.S. Treasury Note Futures, November Strike Price $134.00, Expires 11/20/20	291		291,000		$	(27,281	)
Cardtronics PLC, September Strike Price $20.00, Expires 9/18/20	43		4,300			(2,150	)
DJ EURO STOXX 50 Index, September Strike Price 2,925.00 EUR, Expires 9/18/20	13		130			(1,396	)
DJ EURO STOXX 50 Index, September Strike Price 3,200.00 EUR, Expires 9/18/20	60		600			(32,292	)
DJ EURO STOXX Banks, October Strike Price 57.50 EUR, Expires 10/16/20	220		11,000			(21,003	)
E-Mini S&P 500 Futures, September Strike Price $3,000.00, Expires 9/18/20	6		300			(1,560	)
Kansas City Southern, September Strike Price $165.00, Expires 9/18/20	39		3,900			(4,290	)
Kansas City Southern, December Strike Price $165.00, Expires 12/18/20	39		3,900			(25,935	)
Live Nation Entertainment Inc., October Strike Price $45.00, Expires 10/16/20	34		3,400			(2,720	)
Live Nation Entertainment Inc., January Strike Price $40.00, Expires 1/15/21	43		4,300			(7,525	)
S&P 500 Index, October Strike Price $2,900.00, Expires 10/16/20	10		1,000			(17,000	)
S&P 500 Index, December Strike Price $1,900.00, Expires 12/18/20	8		800			(6,400	)
S&P 500 Index, December Strike Price $2,400.00, Expires 12/18/20	6		600			(11,940	)
STOXX Europe 600 Automobiles & Parts Index, December Strike Price 500.00 EUR, Expires 12/18/20	100		5,000			(523,282	)
Taubman Centers Inc., December Strike Price $30.00, Expires 12/18/20	36		3,600			(12,960	)
Tiffany & Co., January Strike Price $90.00, Expires 1/15/21	29		2,900			(7,975	)
Tiffany & Co., January Strike Price $100.00, Expires 1/15/21	103		10,300			(36,050	)
						(741,759	)
Puts – Over-the-Counter (0.0)%†
Currency Options (0.0)%†
NZD/USD, Counterparty JPHQ, September Strike Price $0.60, Expires 9/02/20	1		3,200,000	NZD		—
USD/BRL, Counterparty JPHQ, October Strike Price 4.50 BRL, Expires 10/08/20	1		366,667			(27	)
USD/RUB, Counterparty JPHQ, November Strike Price 70.80 RUB, Expires 11/20/20	1		394,000			(3,336	)
USD/ZAR, Counterparty JPHQ, November Strike Price 17.00 ZAR, Expires 11/19/20	1		275,500			(7,611	)
						(10,974	)
Total Options Written (Premiums Received $1,236,883)						(1,674,739	)
	Country	Shares
Securities Sold Short (21.8)%
Common Stocks (10.2)%
Aerospace & Defense (0.2)%
Heico Corp.	United States		7,703			(846,714	)
Lockheed Martin Corp.	United States		582			(227,131	)
Northrop Grumman Corp.	United States		2,430			(832,542	)
TransDigm Group Inc.	United States		1,858			(928,387	)
						(2,834,774	)
Air Freight & Logistics (0.2)%
Air Transport Services Group Inc.	United States		22,636			(575,407	)
Atlas Air Worldwide Holdings Inc.	United States		21,994			(1,240,242	)
						(1,815,649	)

36

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares		Value
Securities Sold Short (continued)
Common Stocks (continued)
Airlines (0.3)%
Air Canada, B	Canada		58,355	$	(787,402	)
American Airlines Group Inc.	United States		95,671		(1,248,507	)
Copa Holdings SA, A	Panama		18,641		(992,633	)
					(3,028,542	)
Auto Components (0.2)%
BorgWarner Inc.	United States		53,045		(2,153,097	)
Automobiles (0.1)%
Ferrari NV	Italy		1,324		(257,849	)
Winnebago Industries Inc.	United States		14,622		(789,296	)
					(1,047,145	)
Biotechnology (0.5)%
Apellis Pharmaceuticals Inc.	United States		20,678		(637,503	)
BioMarin Pharmaceutical Inc.	United States		2,124		(165,736	)
Bridgebio Pharma Inc.	United States		25,094		(749,307	)
Coherus Biosciences Inc.	United States		46,252		(877,400	)
Flexion Therapeutics Inc.	United States		30,536		(356,050	)
Gossamer Bio Inc.	United States		28,077		(390,270	)
Insmed Inc.	United States		16,539		(466,234	)
Intercept Pharmaceuticals Inc.	United States		8,544		(426,175	)
Ironwood Pharmaceuticals Inc., A	United States		87,587		(884,629	)
Karyopharm Therapeutics Inc.	United States		46,890		(713,197	)
Ligand Pharmaceuticals Inc.	United States		727		(74,154	)
Radius Health Inc.	United States		9,688		(119,937	)
					(5,860,592	)
Building Products (0.0)%†
Patrick Industries Inc.	United States		10,430		(586,270	)
Capital Markets (0.1)%
The Charles Schwab Corp.	United States		23,758		(844,122	)
Construction Materials (0.0)%†
Martin Marietta Materials Inc.	United States		2,429		(492,771	)
Consumer Finance (0.3)%
Encore Capital Group Inc.	United States		58,299		(2,678,256	)
EZCORP Inc., A	United States		53,909		(290,030	)
PRA Group Inc.	United States		11,137		(519,820	)
					(3,488,106	)
Diversified Consumer Services (0.0)%†
Chegg Inc.	United States		3,395		(250,347	)
K12 Inc.	United States		10,107		(376,082	)
					(626,429	)
Diversified Financial Services (0.0)%†
Element Fleet Management Corp.	Canada		53,904		(443,432	)
Diversified Telecommunication Services (0.0)%†
Liberty Latin America Ltd., C	Chile		22,602		(215,623	)
Electric Utilities (0.1)%
NextEra Energy Inc.	United States		2,413		(673,637	)
Electronic Equipment, Instruments & Components (0.3)%
II-VI Inc.	United States		23,334		(1,038,363	)
Knowles Corp.	United States		22,317		(336,094	)
OSI Systems Inc.	United States		5,386		(424,147	)
TTM Technologies Inc.	United States		131,497		(1,506,956	)

37

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares		Value
Securities Sold Short (continued)
Common Stocks (continued)
Electronic Equipment, Instruments & Components (continued)
Vishay Intertechnology Inc.	United States		2,579	$	(41,238	)
					(3,346,798	)
Energy Equipment & Services (0.0)%†
Helix Energy Solutions Group Inc.	United States		19,950		(71,421	)
SEACOR Holdings Inc.	United States		1,616		(51,082	)
					(122,503	)
Entertainment (0.1)%
Cinemark Holdings Inc.	United States		44,211		(647,691	)
Spotify Technology SA	United States		357		(100,731	)
					(748,422	)
Equity Real Estate Investment Trusts (REITs) (0.3)%
Colliers International Group Inc.	Canada		12,604		(798,337	)
Innovative Industrial Properties Inc., A	United States		22,530		(2,773,218	)
SL Green Realty Corp.	United States		1,659		(77,575	)
					(3,649,130	)
Food & Staples Retailing (0.0)%†
The Chefs’ Warehouse Inc.	United States		14,259		(211,176	)
Health Care Equipment & Supplies (0.5)%
CONMED Corp.	United States		8,111		(700,060	)
Cryoport Inc.	United States		30,283		(1,680,101	)
Envista Holdings Corp., W	United States		55,281		(1,326,191	)
Integra Lifesciences Holdings Corp.	United States		7,692		(367,601	)
Livanova PLC	United States		664		(31,142	)
Nevro Corp.	United States		5,904		(812,036	)
NuVasive Inc.	United States		12,089		(630,199	)
Varex Imaging Corp.	United States		24,685		(273,757	)
					(5,821,087	)
Health Care Providers & Services (0.1)%
1life Healthcare Inc.	United States		14,654		(427,457	)
Petiq Inc., A	United States		31,843		(1,120,237	)
					(1,547,694	)
Health Care Technology (0.5)%
Allscripts Healthcare Solutions Inc.	United States		69,111		(617,161	)
Health Catalyst Inc.	United States		27,145		(846,381	)
Tabula Rasa HealthCare Inc.	United States		18,134		(917,581	)
Teladoc Health Inc.	United States		14,510		(3,129,662	)
					(5,510,785	)
Hotels, Restaurants & Leisure (1.1)%
Bloomin’ Brands Inc.	United States		85,289		(1,223,044	)
Caesars Entertainment Inc.	United States		57,841		(2,649,118	)
Chipotle Mexican Grill Inc., A	United States		283		(370,809	)
fEvolution Gaming Group AB, 144A	Sweden		58,790		(4,400,431	)
Hilton Worldwide Holdings Inc.	United States		2,780		(251,201	)
Marriott Vacations Worldwide Corp.	United States		5,909		(559,405	)
Norwegian Cruise Line Holdings Ltd.	United States		117,341		(2,007,704	)
Royal Caribbean Cruises Ltd.	United States		5,679		(390,942	)
Shake Shack Inc., A	United States		1,763		(120,325	)
Wingstop Inc.	United States		3,259		(532,521	)
					(12,505,500	)

38

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares		Value
Securities Sold Short (continued)
Common Stocks (continued)
Insurance (0.7)%
Aon PLC, A	United States		38,952	$	(7,790,011	)
Interactive Media & Services (0.1)%
Zillow Group Inc., C	United States		15,525		(1,331,424	)
Internet & Direct Marketing Retail (0.5)%
fTakeaway.com NV, 144A	Netherlands		48,460		(5,392,507	)
Wayfair Inc., A	United States		2,007		(595,196	)
					(5,987,703	)
IT Services (0.4)%
CSG Systems International Inc.	United States		7,866		(334,856	)
I3 Verticals Inc., A	United States		21,192		(591,045	)
KBR Inc.	United States		46,681		(1,166,558	)
MongoDB Inc., A	United States		4,315		(1,008,847	)
Okta Inc., A	United States		3,194		(687,892	)
Perficient Inc.	United States		16,056		(688,963	)
Sabre Corp.	United States		42,312		(295,761	)
Square Inc., A	United States		924		(147,433	)
					(4,921,355	)
Machinery (0.1)%
Chart Industries Inc.	United States		12,331		(810,393	)
The Greenbrier Cos. Inc.	United States		5,477		(148,919	)
Lincoln Electric Holdings Inc.	United States		766		(74,080	)
The Middleby Corp.	United States		3,282		(321,308	)
SKF AB, B	Sweden		1,815		(36,303	)
					(1,391,003	)
Marine (0.0)%†
Kirby Corp.	United States		6,570		(278,831	)
Kuehne + Nagel International AG	Switzerland		980		(190,012	)
					(468,843	)
Media (0.4)%
Liberty Media Corp., C	United States		19,777		(770,908	)
Live Nation Entertainment Inc.	United States		43,015		(2,443,252	)
Sirius XM Holdings Inc.	United States		114,114		(669,849	)
Snap Inc., A	United States		39,299		(887,764	)
					(4,771,773	)
Metals & Mining (0.1)%
Endeavour Mining Corp.	Ivory Coast		9,278		(257,211	)
Ivanhoe Mines Ltd., A	Canada		7,196		(28,412	)
Pretium Resources Inc.	Canada		29,931		(383,715	)
					(669,338	)
Mortgage Real Estate Investment Trusts (REITs) (0.1)%
Arbor Realty Trust Inc.	United States		18,300		(207,156	)
Hannon Armstrong Sustainable Infrastructure Capital Inc.	United States		2,718		(115,406	)
PennyMac Mortgage Investment Trust	United States		20,198		(346,194	)
Redwood Trust Inc.	United States		19,418		(134,567	)
					(803,323	)
Oil, Gas & Consumable Fuels (0.2)%
Chevron Corp.	United States		23,660		(1,985,784	)
SFL Corp. Ltd.	Norway		7,283		(63,945	)
					(2,049,729	)

39

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares		Value
Securities Sold Short (continued)
Common Stocks (continued)
Personal Products (0.1)%
Herbalife Nutrition Ltd.	United States		23,129	$	(1,136,790	)
Pharmaceuticals (0.3)%
Aerie Pharmaceuticals Inc.	United States		20,474		(225,214	)
Aphria Inc.	Canada		51,483		(250,722	)
Aurora Cannabis Inc.	Canada		378		(3,704	)
Avadel Pharmaceuticals PLC, ADR	United States		58,715		(429,207	)
Canopy Growth Corp.	Canada		8,824		(145,516	)
Collegium Pharmaceutical Inc.	United States		25,659		(489,061	)
Innoviva Inc.	United States		22,395		(262,245	)
Jazz Pharmaceuticals PLC	United States		5,392		(724,631	)
Pacira Biosciences Inc.	United States		2,600		(162,552	)
Revance Therapeutics Inc.	United States		26,933		(787,252	)
Theravance Biopharma Inc.	Cayman Islands		6,392		(117,165	)
					(3,597,269	)
Professional Services (0.1)%
FTI Consulting Inc.	United States		7,868		(902,932	)
Real Estate Management & Development (0.2)%
Redfin Corp.	United States		37,346		(1,776,549	)
Tricon Residential Inc., Common Subscription Receipt	Canada		4,165		(35,189	)
					(1,811,738	)
Semiconductors & Semiconductor Equipment (0.4)%
Advanced Micro Devices Inc.	United States		1,336		(121,336	)
Analog Devices Inc.	United States		9,680		(1,131,398	)
Enphase Energy Inc.	United States		878		(67,808	)
Impinj Inc.	United States		19,779		(483,597	)
Microchip Technology Inc.	United States		6,817		(747,825	)
NVIDIA Corp.	United States		182		(97,366	)
Rambus Inc.	United States		27,388		(367,821	)
Silicon Laboratories Inc.	United States		1,789		(183,211	)
SMART Global Holdings Inc.	United States		23,795		(599,634	)
Synaptics Inc.	United States		13,337		(1,138,046	)
					(4,938,042	)
Software (1.2)%
8x8 Inc.	United States		28,263		(477,080	)
Alteryx Inc., A	United States		592		(71,531	)
Avaya Holdings Corp.	United States		29,048		(450,825	)
Coupa Software Inc.	United States		2,693		(882,604	)
CyberArk Software Ltd.	United States		2,368		(261,664	)
Envestnet Inc.	United States		14,338		(1,189,911	)
Everbridge Inc.	United States		8,438		(1,253,971	)
FireEye Inc.	United States		13,284		(195,009	)
Five9 Inc.	United States		5,938		(756,739	)
J2 Global Inc.	United States		3,555		(248,815	)
LivePerson Inc.	United States		38,343		(2,287,543	)
Nice Ltd., ADR	Israel		24		(5,516	)
Nuance Communications Inc.	United States		42,916		(1,285,763	)
Nutanix Inc., A	United States		6,633		(190,433	)
Palo Alto Networks Inc.	United States		871		(224,204	)
Pluralsight Inc., A	United States		12,740		(243,844	)
PROS Holdings Inc.	United States		6,478		(252,642	)
SailPoint Technologies Holding Inc.	United States		34,647		(1,359,202	)
Slack Technologies Inc., A	United States		25,274		(829,998	)
Verint Systems Inc.	United States		2,274		(108,151	)
Workiva Inc., A	United States		6,081		(358,779	)

40

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Shares		Value
Securities Sold Short (continued)
Common Stocks (continued)
Software (continued)
Zscaler Inc.	United States		6,106	$	(875,234	)
					(13,809,458	)
Specialty Retail (0.2)%
National Vision Holdings Inc.	United States		32,196		(1,209,604	)
RH	United States		4,590		(1,517,224	)
					(2,726,828	)
Technology Hardware, Storage & Peripherals (0.0)%†
Pure Storage Inc., A	United States		22,446		(342,526	)
Textiles, Apparel & Luxury Goods (0.1)%
LVMH Moet Hennessy Louis Vuitton SE	France		343		(161,080	)
Under Armour Inc., C	United States		79,811		(706,327	)
					(867,407	)
Thrifts & Mortgage Finance (0.0)%†
LendingTree Inc.	United States		562		(173,624	)
Tobacco (0.0)%†
Turning Point Brands Inc.	United States		12,701		(367,059	)
Trading Companies & Distributors (0.1)%
Kaman Corp.	United States		14,483		(669,839	)
SiteOne Landscape Supply Inc.	United States		999		(124,925	)
WESCO International Inc.	United States		11,052		(517,786	)
					(1,312,550	)
Transportation Infrastructure (0.0)%†
Westshore Terminals Investment Corp.	Canada		9,261		(117,435	)
Total Common Stocks (Proceeds $112,520,830)					(119,861,444	)
Exchange Traded Funds (11.3)%
Consumer Discretionary Select Sector SPDR Fund	United States		5,390		(808,985	)
ETFMG Prime Cyber Security ETF	United States		68,010		(3,359,014	)
Health Care Select Sector SPDR Fund	United States		48,353		(5,234,696	)
Invesco QQQ Series 1 ETF	United States		60,316		(17,785,982	)
iShares Core S&P Small-Cap ETF	United States		33,783		(2,498,928	)
iShares Edge MSCI USA Momentum Factor ETF	United States		12,600		(1,933,848	)
iShares NASDAQ Biotechnology ETF	United States		24,165		(3,276,774	)
iShares North American Tech ETF	United States		22,455		(7,347,725	)
iShares North American Tech-Multimedia Networking ETF	United States		68,731		(3,580,754	)
iShares North American Tech-Software ETF	United States		15,959		(5,171,833	)
iShares PHLX Semiconductor ETF	United States		19,855		(6,099,853	)
iShares Russell 2000 Growth ETF	United States		63,636		(14,414,827	)
iShares Russell Mid-Cap Growth ETF	United States		19,719		(3,461,868	)
iShares U.S. Telecommunications ETF	United States		49,700		(1,445,276	)
SPDR S&P 500 ETF Trust	United States		156,373		(54,622,653	)
SPDR S&P MidCap 400 ETF Trust	United States		5,021		(1,764,379	)
Total Exchange Traded Funds (Proceeds $115,517,157)					(132,807,395	)
		Principal Amount*
Corporate Bonds and Notes (0.1)%
Electric Utilities (0.1)%
FirstEnergy Corp., C, senior bond, 3.40%, 3/01/50	United States		200,000		(202,270	)

41

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

	Country	Principal Amount*		Value
Securities Sold Short (continued)
Corporate Bonds and Notes (continued)
Electric Utilities (continued)
Southern California Edison Co., secured bond, 3.65%, 2/01/50	United States		161,000	$	(171,541	)
					(373,811	)
Equity Real Estate Investment Trusts (REITs) (0.0)%†
Simon Property Group LP, senior bond, 2.45%, 9/13/29	United States		121,000		(121,172	)
Hotels, Restaurants & Leisure (0.0)%†
Boyd Gaming Corp., senior note, 4.75%, 12/01/27	United States		93,000		(92,843	)
MGM Resorts International, senior note, 5.50%, 4/15/27	United States		132,000		(139,775	)
					(232,618	)
Personal Products (0.0)%†
Sally Holdings LLC / Sally Capital Inc., senior note, 5.625%, 12/01/25	United States		83,000		(84,392	)
Textiles, Apparel & Luxury Goods (0.0)%†
Hanesbrands Inc., senior bond, 144A, 4.875%, 5/15/26	United States		169,000		(184,312	)
Total Corporate Bonds and Notes (Proceeds $919,798)					(996,305	)
U.S. Government and Agency Securities (Proceeds $2,886,627) (0.2)%
U.S. Treasury Note, 0.625%, 5/15/30	United States		2,907,000		(2,887,696	)
Total Securities Sold Short (Proceeds $231,844,412)				$	(256,552,840	)

42

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin 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 units specified in the contract, and can include currency units, bushels, shares, pounds, barrels or other units. Currency units are stated in U.S. dollars unless otherwise indicated.

^aNon-income producing.

^bA 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 August 31, 2020, the net value of these securities and/or cash pledged amounted to $227,129,331, representing 19.3% of net assets.

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

^dFair valued using significant unobservable inputs. See Note 9 regarding fair value measurements.

^eA portion or all of the security is on loan at August 31, 2020.

^fSecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers or in public offering registered under the Securities Act of 1933. At August 31, 2020, the net value of these securities was $205,693,047, representing 17.5% of net assets.

^gSee Note 5 regarding restricted securities.

^hContingent distributions represent the right to receive additional distributions, if any, during the reorganization of the underlying company.

ⁱSecurity was purchased pursuant to Regulation S under the Securities Act of 1933, which exempts from registration securities offered and sold outside of the United States. Such a security 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 August 31, 2020, the aggregate value of these securities was $16,984,921, representing 1.4% of net assets.

^jDefaulted security or security for which income has been deemed uncollectible.

^kThe coupon rate shown represents the rate at period end.

^lSecurities denominated in Argentine Peso have been designated as Level 3 investments. See Note 9 regarding fair value measurements.

^mA portion or all of the security purchased on a delayed delivery basis.

ⁿPerpetual security with no stated maturity date.

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

^pAdjustable rate security with an interest rate that is not based on a published reference index and spread. The rate is based on the structure of the agreement and current market conditions. The coupon rate shown represents the rate at period end.

^qInvestment in an interest-only security entitles holders to receive only the interest payment on the underlying instruments. The principal amount shown is the notional amount of the underlying instruments.

^rThe rate shown is the annualized seven-day effective yield at period end.

^sA portion or all of the security is owned by K2 Holdings Investment Corp., a wholly-owned subsidiary of the Fund. See Note 8.

^tInvestment is through participation in a joint account with other funds managed by the investment manager or an affiliate of the investment manager. At August 31, 2020, all repurchase agreements had been entered into on that date.

^uThe security was issued on a discount basis with no stated coupon rate.

^vSee Note 7 regarding investments in affiliated management investment companies.

43

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

At August 31, 2020, the Fund had the following futures contracts outstanding. See Note 3.

Futures Contracts

Description	Type		Number of Contracts		Notional     Amount*		Expiration Date		Value/Unrealized Appreciation (Depreciation)
Commodity Contractsa
Aluminum		Long		5	$	221,438		9/14/20	$	7,110
Aluminum		Short		5		221,438		9/14/20		(20,890	)
Brent Crude Oil		Short		25		1,132,000		9/30/20		4,192
Cocoa		Short		2		47,107		12/14/20		(1,018	)
Coffee		Short		6		290,362		12/18/20		(10,011	)
Copper		Long		11		1,837,413		9/14/20		222,485
Copper		Short		11		1,837,413		9/14/20		(381,728	)
Copper		Long		18		2,999,813		12/14/20		95,528
Corn		Short		73		1,305,787		12/14/20		(58,462	)
Cotton		Long		2		65,160		12/08/20		694
Crude Oil		Short		4		170,440		9/22/20		1,301
Gasoline		Long		11		560,729		9/30/20		(13,170	)
Gold 100 Oz		Long		4		791,440		12/29/20		6,881
Hard Red Winter Wheat		Short		31		736,637		12/14/20		(74,210	)
Low Sulphur Gas Oil		Short		5		184,125		10/12/20		5,217
Natural Gas		Short		31		815,300		9/28/20		(89,339	)
NY Harbor		Short		16		818,026		9/30/20		35,644
Silver		Long		11		1,572,670		12/29/20		81,020
Soybean Meal		Short		10		312,500		12/14/20		(9,197	)
Soybeans		Short		12		572,100		11/13/20		(22,832	)
Sugar		Long		29		431,334		2/26/21		41
Wheat		Short		6		165,675		12/14/20		(4,441	)
Zinc		Long		5		312,281		9/14/20		38,466
Zinc		Short		5		312,281		9/14/20		(67,084	)
Zinc		Long		3		188,981		12/14/20		2,499
										(251,304	)
Equity Contracts
CAC 40 10 Euro Indexa		Long		29		1,710,452		9/18/20		(4,992	)
CAC 40 10 Euro Index		Short		7		412,868		9/18/20		(961	)
DAX Indexa		Long		6		2,313,778		9/18/20		(14,154	)
DAX Index		Short		2		771,260		9/18/20		(33,807	)
DJ EURO STOXX 50 Indexa		Long		73		2,844,280		9/18/20		40,663
DJ EURO STOXX 50 Index		Short		554		21,585,360		9/18/20		(89,236	)
DJIA Mini E-CBOT Indexa		Long		27		3,836,160		9/18/20		357,627
E-Mini Russell 2000a		Long		30		2,341,950		9/18/20		195,835
E-Mini Russell 2000		Short		30		2,341,950		9/18/20		(233,358	)
FTSE 100 Indexa		Long		28		2,231,339		9/18/20		(40,879	)
FTSE 100 Index		Short		60		4,781,441		9/18/20		216,868
FTSE/JSE Top 40 Index		Short		21		632,952		9/17/20		(10,761	)
FTSE/MIB Index		Short		3		351,273		9/18/20		(747	)
Hang Seng Indexa		Long		18		2,911,860		9/29/20		(32,859	)
MSCI Emerging Market Index		Long		82		4,511,640		9/18/20		312,497
MSCI Taiwan Index		Long		6		294,660		9/29/20		(5,492	)
NASDAQ 100 E-Mini Indexa		Long		12		2,907,360		9/18/20		505,774
NASDAQ 100 E-Mini Index		Short		2		484,560		9/18/20		(81,083	)
Nikkei 225 Indexa		Long		55		7,653,307		9/10/20		98,609
S&P 500 E-Mini Indexa		Long		18		3,149,010		9/18/20		108,849
S&P 500 E-Mini Index		Short		213		37,263,285		9/18/20		(3,863,858	)
S&P/TSX 60 Index		Long		8		1,213,171		9/17/20		86,695
SPI 200 Futures		Short		5		555,928		9/17/20		2,171

44

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

Futures Contracts (continued)

Description	Type		Number of Contracts		Notional     Amount*		Expiration Date		Value/Unrealized Appreciation (Depreciation)
Equity Contracts (continued)
STOXX 600 Banks Index		Long		1,802	$	9,924,139		9/18/20	$	(113,681	)
STOXX 600 Banks Index		Short		106		583,773		9/18/20		30,629
STOXX Europe 600 Index		Short		10		217,965		9/18/20		(1,354	)
TOPIX Indexa		Long		9		1,373,177		9/10/20		15,294
TOPIX Index		Short		19		2,898,928		9/10/20		(56,080	)
										(2,611,791	)
Interest Rate Contracts
3 Month EURIBORa		Long		192		57,555,550		12/13/21		1,510
90 Day Eurodollara		Long		574		143,184,300		12/13/21		17,904
90 Day Sterlinga		Long		396		66,156,160		12/15/21		36,788
Australian 10 Yr. Bonda		Long		7		761,649		9/15/20		(2,755	)
Australian 10 Yr. Bond		Short		2		217,614		9/15/20		1,697
Canadian 10 Yr. Bonda		Long		33		3,818,776		12/18/20		(8,749	)
Canadian 10 Yr. Bond		Short		7		810,043		12/18/20		2,332
Euro-BOBL		Short		7		1,124,621		9/08/20		3,635
Euro-BOBL		Short		21		3,375,868		12/08/20		620
Euro-BTP		Long		48		8,374,997		9/08/20		350,621
Euro-BTP		Long		24		4,132,796		12/08/20		(25,293	)
Euro-Bunda		Long		12		2,514,046		9/08/20		(7,693	)
Euro-Bund		Short		10		2,095,038		9/08/20		1,041
Euro-Bund		Short		27		5,565,419		12/08/20		(4,134	)
Euro-SCHATZ		Long		23		3,074,471		9/08/20		(2,056	)
Euro-SCHATZ		Long		59		7,900,063		12/08/20		(171	)
Japan 10 Yr. Bond		Short		1		1,431,242		9/14/20		2,745
Long Gilta		Long		15		2,707,130		12/29/20		(16,238	)
Long Gilt		Short		11		1,985,229		12/29/20		17,004
U.S. Treasury 5 Yr. Notea		Long		11		1,386,344		12/31/20		1,766
U.S. Treasury 5 Yr. Note		Short		126		15,879,938		12/31/20		(23,978	)
U.S. Treasury 10 Yr. Notea		Long		14		1,949,500		12/21/20		3,072
U.S. Treasury 10 Yr. Note		Short		96		13,368,000		12/21/20		(6,232	)
U.S. Treasury Long Bonda		Long		52		9,137,375		12/21/20		(69,306	)
U.S. Treasury Long Bond		Short		22		3,865,812		12/21/20		606
U.S. Treasury Ultra Bond		Long		20		4,418,125		12/21/20		(4,284	)
U.S. Treasury Ultra Bond		Short		12		2,650,875		12/21/20		253
										270,705
Total Futures Contracts									$	(2,592,390	)

^* As of period end.

^a A portion or all of the contracts are owned by K2 Holdings Investment Corp., a wholly-owned subsidiary of the Fund. See Note 8.

At August 31, 2020, the Fund had the following forward exchange contracts outstanding. See Note 3.

Forward Exchange Contracts

Currency

Counterpartya

Type

Quantity

Contract Amount

Settlement Date

Unrealized Appreciation

Unrealized Depreciation

OTC Forward Exchange Contracts

Japanese Yen

JPHQ

Buy

36,918,350

348,134

9/01/20

$

432

$

–

Japanese Yen

JPHQ

Sell

36,918,350

350,000

9/01/20

1,434

–

Mexican Peso

JPHQ

Buy

27,094,469

1,239,128

9/01/20

–

(920

)

Mexican Peso

JPHQ

Sell

27,094,469

1,240,000

9/01/20

1,792

–

New Zealand Dollar

JPHQ

Buy

1,480,000

996,463

9/01/20

465

–

45

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin 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)
New Zealand Dollar		JPHQ		Sell		1,480,000		990,993		9/01/20	$	–	$	(5,935	)
Russian Ruble		JPHQ		Buy		31,026,059		420,000		9/03/20		–		(1,277	)
Japanese Yen		BOFA		Sell		101,229,418		960,184		9/10/20		4,291		–
Japanese Yen		BZWS		Sell		28,575,436		266,473		9/10/20		–		(3,360	)
Japanese Yen		GSCO		Buy		14,952,061		140,066		9/10/20		1,124		–
Japanese Yen		MSCI		Buy		5,097,671		48,316		9/10/20		–		(180	)
Japanese Yen		SSBT		Buy		485,301,540		4,517,410		9/10/20		65,214		–
Japanese Yen		SSBT		Sell		101,518,628		958,357		9/10/20		–		(267	)
Australian Dollar		BOFA		Buy		517,234		369,147		9/14/20		12,359		–
Australian Dollar		BZWS		Sell		209,919		151,085		9/14/20		–		(3,749	)
Australian Dollar		GSCO		Sell		439,050		312,712		9/14/20		–		(11,126	)
Australian Dollar		JPHQ		Sell		3,762,797		2,615,808		9/14/20		–		(159,587	)
Australian Dollar		MSCI		Buy		426,454		304,949		9/14/20		9,598		–
Australian Dollar		SSBT		Buy		839,638		599,470		9/14/20		19,837		–
Australian Dollar		UBSW		Buy		920,209		641,790		9/14/20		36,945		–
New Zealand Dollar		BOFA		Buy		566,226		377,735		9/14/20		3,670		–
New Zealand Dollar		BZWS		Sell		1,963,012		1,287,451		9/14/20		–		(34,818	)
New Zealand Dollar		SSBT		Buy		308,345		204,110		9/14/20		3,589		–
Swiss Franc		GSCO		Sell		376,835		402,076		9/14/20		–		(14,972	)
Swiss Franc		MSCI		Buy		1,048,684		1,115,546		9/14/20		45,046		–
Swiss Franc		UBSW		Sell		328,836		358,915		9/14/20		–		(5,012	)
British Pound		BOFA		Sell		232,793		298,507		9/15/20		–		(12,714	)
British Pound		GSCO		Buy		166,120		216,631		9/15/20		5,455		–
British Pound		MSCI		Sell		503,622		637,772		9/15/20		–		(35,519	)
British Pound		SSBT		Buy		1,556,575		1,963,744		9/15/20		117,239		–
British Pound		UBSW		Sell		220,873		288,567		9/15/20		–		(6,718	)
British Pound		MSCO		Sell		1,133,766		1,426,789		9/16/20		–		(88,951	)
Euro		BNYM		Buy		91,065		107,287		9/16/20		1,424		–
Euro		BNYM		Sell		2,522,285		2,861,372		9/16/20		–		(149,679	)��
Euro		BOFA		Sell		2,259,966		2,648,911		9/16/20		–		(48,989	)
Euro		BZWS		Buy		320,643		363,582		9/16/20		19,195		–
Euro		GSCO		Buy		107,453		126,075		9/16/20		2,200		–
Euro		JPHQ		Buy		835,715		941,413		9/16/20		56,246		–
Euro		JPHQ		Sell		454,631		503,087		9/16/20		–		(39,642	)
Euro		MSCI		Sell		738,246		852,422		9/16/20		–		(28,881	)
Euro		MSCO		Sell		575,000		672,864		9/16/20		–		(13,559	)
Euro		MSCS		Sell		270,000		305,780		9/16/20		–		(16,540	)
Euro		SSBT		Buy		403,008		479,251		9/16/20		1,851		–
Euro		UBSW		Buy		11,147,380		12,561,687		9/16/20		745,822		–
Euro		UBSW		Sell		2,803,433		3,277,292		9/16/20		–		(69,387	)
Indonesian Rupiah		JPHQ		Sell		68,540,989,568		4,457,309		9/16/20		–		(242,204	)
Russian Ruble		JPHQ		Buy		83,032,622		1,123,458		9/16/20		2,740		(7,204	)
Russian Ruble		JPHQ		Sell		741,447,078		10,095,270		9/16/20		103,110		–
South African Rand		JPHQ		Buy		15,523,085		881,185		9/16/20		32,923		–
Swiss Franc		BNYM		Buy		239,790		262,660		9/16/20		2,735		–
Swiss Franc		BNYM		Sell		412,255		434,310		9/16/20		–		(21,965	)
Thai Baht		JPHQ		Buy		44,871,048		1,406,947		9/16/20		34,716		–
Thai Baht		JPHQ		Sell		44,871,048		1,406,175		9/16/20		–		(35,488	)
Australian Dollarb		MSCO		Buy		17,649,000		12,378,118		9/18/20		639,770		–
Australian Dollarb		MSCO		Sell		6,149,000		4,355,600		9/18/20		–		(179,898	)
British Pound		BNYM		Sell		1,999,368		2,628,162		9/18/20		–		(44,848	)
British Pound		BZWS		Buy		151,000		198,631		9/18/20		3,246		–
British Pound		BZWS		Sell		291,000		380,628		9/18/20		–		(8,419	)
British Poundb		MSCO		Buy		12,290,000		15,707,835		9/18/20		722,998		–
British Poundb		MSCO		Sell		7,267,000		9,375,339		9/18/20		–		(340,112	)

46

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin 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)
Canadian Dollar		BZWS		Buy		479,000		353,552		9/18/20	$	13,700	$	–
Canadian Dollar		BZWS		Sell		479,000		351,791		9/18/20		–		(15,461	)
Canadian Dollarb		MSCO		Buy		10,939,000		8,257,454		9/18/20		129,525		–
Canadian Dollarb		MSCO		Sell		10,104,000		7,498,184		9/18/20		–		(248,597	)
Euro		BNYM		Buy		236,468		281,920		9/18/20		383		–
Euro		BNYM		Sell		18,841,740		22,315,026		9/18/20		–		(178,870	)
Euro		BZWS		Buy		15,012,000		17,250,311		9/18/20		671,528		(8	)
Euro		BZWS		Sell		28,690,000		32,678,471		9/18/20		20		(1,572,631	)
Eurob		MSCO		Buy		13,263,000		15,253,007		9/18/20		581,001		(197	)
Eurob		MSCO		Sell		4,729,000		5,544,167		9/18/20		–		(101,471	)
Hong Kong Dollar		BNYM		Sell		21,609,304		2,788,179		9/18/20		351		–
Japanese Yenb		MSCO		Buy		2,992,091,000		28,120,255		9/18/20		197,429		(60,730	)
Japanese Yenb		MSCO		Sell		2,613,993,000		24,507,550		9/18/20		14,385		(193,077	)
Mexican Pesob		MSCO		Buy		71,942,000		3,222,078		9/18/20		58,453		(22	)
Mexican Pesob		MSCO		Sell		29,235,000		1,313,139		9/18/20		–		(19,957	)
New Zealand Dollarb		MSCO		Buy		9,446,000		6,267,544		9/18/20		95,181		–
New Zealand Dollarb		MSCO		Sell		11,086,000		7,258,496		9/18/20		–		(208,918	)
Swedish Krona		BZWS		Buy		57,000		6,415		9/18/20		176		–
Swedish Krona		BZWS		Sell		57,000		6,354		9/18/20		–		(237	)
Swiss Franc		BNYM		Sell		4,673,697		5,125,865		9/18/20		–		(47,188	)
Swiss Franc		BZWS		Sell		978,000		1,074,694		9/18/20		–		(7,799	)
Swiss Francb		MSCO		Buy		9,778,000		10,399,291		9/18/20		423,514		(86	)
Swiss Francb		MSCO		Sell		3,056,000		3,336,381		9/18/20		17		(46,151	)
South Korean Won		JPHQ		Buy		2,445,368,738		2,034,806		9/22/20		23,759		–
Canadian Dollar		BNYM		Sell		3,556,000		2,619,598		9/23/20		–		(106,840	)
Australian Dollar		JPHQ		Buy		4,635,318		3,362,376		9/25/20		56,719		–
British Pound		JPHQ		Buy		1,373,367		1,813,575		9/25/20		22,608		–
Canadian Dollar		JPHQ		Sell		2,061,484		1,566,123		9/25/20		–		(14,457	)
Euro		JPHQ		Sell		5,393,952		6,429,539		9/25/20		–		(10,963	)
Hungarian Forint		JPHQ		Buy		350,760,131		1,199,333		9/25/20		–		(22,172	)
Japanese Yen		JPHQ		Buy		77,826,305		736,798		9/25/20		–		(1,744	)
Japanese Yen		JPHQ		Sell		36,918,350		348,218		9/25/20		–		(468	)
Mexican Peso		JPHQ		Buy		280,288,069		12,653,209		9/25/20		116,809		–
Mexican Peso		JPHQ		Sell		27,094,469		1,235,443		9/25/20		1,010		–
New Israeli Shekel		JPHQ		Sell		5,629,946		1,654,904		9/25/20		–		(23,968	)
New Zealand Dollar		JPHQ		Buy		659,923		437,119		9/25/20		7,395		–
New Zealand Dollar		JPHQ		Sell		1,480,000		996,435		9/25/20		–		(471	)
Norwegian Krone		JPHQ		Buy		92,189,263		10,407,724		9/25/20		147,442		–
Russian Ruble		JPHQ		Buy		172,530,032		2,333,453		9/25/20		2,616		(13,259	)
South African Rand		JPHQ		Buy		6,405,692		372,492		9/25/20		4,339		–
South African Rand		JPHQ		Sell		9,661,913		561,664		9/25/20		–		(6,722	)
Swiss Franc		JPHQ		Sell		8,674,490		9,552,915		9/25/20		–		(50,374	)
Australian Dollar		BNYM		Buy		500,000		343,467		9/30/20		25,349		–
British Pound		BNYM		Sell		189,000		233,439		9/30/20		–		(19,262	)
British Pound		JPHQ		Sell		200,000		267,285		9/30/20		–		(123	)
Canadian Dollar		BNYM		Sell		400,000		292,598		9/30/20		–		(14,094	)
Euro		BNYM		Sell		1,060,000		1,192,888		9/30/20		–		(72,920	)
Euro		JPHQ		Sell		1,980,000		2,220,947		9/30/20		–		(143,486	)
Euro		MSCS		Sell		90,000		101,144		9/30/20		–		(6,330	)
Japanese Yen		JPHQ		Sell		5,360,000		50,232		9/30/20		–		(396	)
Euro		HSBC		Sell		675,000		758,552		10/02/20		–		(47,539	)
Canadian Dollar		GSCO		Buy		119,836		89,934		10/05/20		1,949		–
Canadian Dollar		MSCI		Sell		259,104		193,044		10/05/20		–		(5,621	)
Canadian Dollar		SSBT		Buy		1,676,334		1,250,726		10/05/20		34,583		–
Euro		JPHQ		Sell		670,000		754,181		10/06/20		–		(46,008	)

47

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin 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)
Colombian Peso		MSCS		Sell		780,000,000		208,333		10/08/20	$	361	$	–
Indian Rupee		JPHQ		Buy		154,742,525		2,050,100		10/22/20		40,802		–
Canadian Dollar		BOFA		Sell		145,000		107,820		10/23/20		–		(3,361	)
Euro		BOFA		Sell		340,000		389,957		10/23/20		–		(16,258	)
Euro		BZWS		Sell		115,000		131,905		10/23/20		–		(5,491	)
Colombian Peso		JPHQ		Buy		2,430,322,306		631,105		10/26/20		16,119		–
Australian Dollar		MSCO		Sell		62,350		44,767		10/30/20		–		(1,227	)
British Pound		DBAB		Sell		166,000		215,692		10/30/20		–		(6,284	)
British Pound		MSCO		Buy		1,244		1,632		10/30/20		31		–
Canadian Dollar		MSCO		Buy		733,653		558,303		10/30/20		4,246		–
Canadian Dollar		MSCO		Sell		2,924,134		2,215,236		10/30/20		–		(26,923	)
Danish Krone		MSCO		Buy		2,059,663		327,974		10/30/20		2,618		–
Danish Krone		MSCO		Sell		8,423,446		1,338,032		10/30/20		–		(13,998	)
Euro		MSCO		Buy		147,431		174,745		10/30/20		1,425		–
Euro		MSCO		Sell		547,571		648,535		10/30/20		–		(5,773	)
Polish Zloty		MSCO		Sell		655,163		176,088		10/30/20		–		(1,866	)
Swedish Krona		MSCO		Sell		1,026,802		116,994		10/30/20		–		(1,794	)
Swiss Franc		MSCO		Buy		260,501		287,309		10/30/20		1,380		–
Swiss Franc		MSCO		Sell		70,100		77,308		10/30/20		–		(377	)
Euro		HSBC		Sell		40,000		47,177		11/13/20		–		(634	)
British Pound		MSCO		Sell		454,000		572,552		12/15/20		–		(34,690	)
South African Rand		JPHQ		Buy		3,298,077		171,000		1/08/21		20,975		–
Total Forward Exchange Contracts											$	5,415,664	$	(5,059,213	)
Net unrealized appreciation (depreciation)											$	356,451

^a May be comprised of multiple contracts with the same counterparty, currency and settlement date.

^b A portion or all of the contracts are owned by K2 Holdings Investment Corp., a wholly-owned subsidiary of the Fund. See Note 8.

48

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

At August 31, 2020, the Fund had the following credit default swap contracts outstanding. See Note 3. Credit Default Swap Contracts
Description	Periodic Payment Rate Received (Paid)		Payment Frequency				Maturity Date		Notional Amounta		Value		Unamortized Upfront Payments (Receipts)		Unrealized Appreciation (Depreciation)		Ratingb
Centrally Cleared Swap Contracts
Contracts to Buy Protectionc
Single Name
Government of Malaysia		(1.00)%		Quarterly				12/20/24		1,796,000	$	(45,456)	$	(47,585)	$	2,129
Government of Mexico		(1.00)%		Quarterly				12/20/23		61,000		(408)		(945)		537
Government of Mexico		(1.00)%		Quarterly				6/20/23		1,763,000		(16,846)		(440)		(16,406)
Government of Mexico		(1.00)%		Quarterly				12/20/23		4,066,000		(27,223)		(11,463)		(15,760)
Government of South Africa		(1.00)%		Quarterly				12/20/24		4,478,000		319,332		132,619		186,713
Government of South Africa		(1.00)%		Quarterly				12/20/24		3,065,000		218,569		90,737		127,832
Government of South Africa		(1.00)%		Quarterly				12/20/24		748,000		53,341		70,156		(16,815)
Government of South Korea		(1.00)%		Quarterly				6/20/24		2,481,367		(78,748)		(83,106)		4,358
Government of South Korea		(1.00)%		Quarterly				12/20/24		1,632,000		(56,273)		(53,379)		(2,894)
Government of Turkey		(1.00)%		Quarterly				6/20/25		909,000		159,536		206,195		(46,659)
Government of Turkey		(1.00)%		Quarterly				9/20/20		1,976,000		2,884		157,718		(154,834)
Government of Turkey		(1.00)%		Quarterly				6/20/24		141,000		20,155		14,154		6,001
L Brand Inc.		(1.00)%		Quarterly				12/20/20		385,000		(140)		9,625		(9,765)
Simon Property Group LP		(1.00)%		Quarterly				6/20/25		270,000		3,890		23,202		(19,312)
Traded Index
CDX.NA.IG.34		(1.00)%		Quarterly				6/20/25		854,000		(14,169)		3,467		(17,636)
Contracts to Sell Protectionc,d
Single Name
Government of South Africa		1.00%		Quarterly				12/20/24		2,847,000		(203,023)		(221,735)		18,712	BB-
Government of South Africa		1.00%		Quarterly				12/20/24		874,000		(62,326)		(25,494)		(36,832)	BB-
Government of Turkey		1.00%		Quarterly				12/20/22		826,000		(72,888)		(37,352)		(35,536)	B+
Traded Index
CDX.NA.HY.34		5.00%		Quarterly				6/20/25		16,023,900		926,614		(1,263,802)		2,190,416	Non- Investment Grade
Total Centrally Cleared Swap Contracts											$	1,126,821	$	(1,037,428)	$	2,164,249
OTC Swap Contracts
Contracts to Buy Protectionc
Single Name					Counterparty
Avis Budget Group Inc.		(5.00)%		Quarterly		BZWS		12/20/24		30,000		(98)		3,049		(3,147)
Avis Budget Group Inc.		(5.00)%		Quarterly		BZWS		12/20/24		28,000		(91)		3,162		(3,253)
Avis Budget Group Inc.		(5.00)%		Quarterly		BZWS		12/20/24		48,000		(156)		5,641		(5,797)
Avis Budget Group Inc.		(5.00)%		Quarterly		GSCO		12/20/24		28,000		(91)		2,783		(2,874)
Avis Budget Group Inc.		(5.00)%		Quarterly		JPHQ		12/20/24		19,000		(62)		2,232		(2,294)
Avis Budget Group Inc.		(5.00)%		Quarterly		MSCO		12/20/24		19,000		(62)		1,888		(1,950)
Beazer Homes USA Inc.		(5.00)%		Quarterly		BZWS		6/20/25		41,000		(4,805)		7,755		(12,560)
Beazer Homes USA Inc.		(5.00)%		Quarterly		GSCO		6/20/25		41,000		(4,805)		(1,765)		(3,040)
Beazer Homes USA Inc.		(5.00)%		Quarterly		MSCO		6/20/25		41,000		(4,805)		8,710		(13,515)
Best Buy Co. Inc.		(5.00)%		Quarterly		BOFA		12/20/24		47,000		(9,923)		(6,881)		(3,042)
Best Buy Co. Inc.		(5.00)%		Quarterly		BOFA		12/20/24		48,000		(10,134)		(6,800)		(3,334)
Best Buy Co. Inc.		(5.00)%		Quarterly		BZWS		12/20/24		48,000		(10,134)		(7,695)		(2,439)
Best Buy Co. Inc.		(5.00)%		Quarterly		GSCO		12/20/24		144,000		(30,401)		(23,632)		(6,769)
Best Buy Co. Inc.		(5.00)%		Quarterly		GSCO		12/20/24		77,000		(16,256)		(10,760)		(5,496)
Best Buy Co. Inc.		(5.00)%		Quarterly		GSCO		12/20/24		29,000		(6,122)		(4,041)		(2,081)
Best Buy Co. Inc.		(5.00)%		Quarterly		GSCO		12/20/24		20,000		(4,222)		(2,648)		(1,574)
Best Buy Co. Inc.		(5.00)%		Quarterly		GSCO		6/20/25		86,000		(19,998)		(10,257)		(9,741)
Carnival Corp.		(1.00)%		Quarterly		BZWS		6/20/23		41,000		8,810		10,255		(1,445)

49

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

Credit Default Swap Contracts (continued)

Description	Periodic Payment Rate Received (Paid)		Payment Frequency		Counterparty		Maturity Date		Notional     Amounta		Value		Unamortized Upfront Payments (Receipts)		Unrealized Appreciation (Depreciation)		Ratingb
OTC Swap Contracts (continued)
Contracts to Buy Protectionc (continued)
Single Name (continued)
Carnival Corp.		(1.00)%		Quarterly		BZWS		6/20/23		41,000		$            8,810	$	10,466	$	(1,656)
Carnival Corp.		(1.00)%		Quarterly		CITI		6/20/23		20,000		4,298		5,092		(794)
Carnival Corp.		(1.00)%		Quarterly		CITI		6/20/25		15,000		3,942		4,300		(358)
Carnival Corp.		(1.00)%		Quarterly		FBCO		6/20/23		65,000		13,967		16,330		(2,363)
Carnival Corp.		(1.00)%		Quarterly		GSCO		12/20/20		16,000		352		880		(528)
Carnival Corp.		(1.00)%		Quarterly		GSCO		6/20/23		41,000		8,810		9,798		(988)
Carnival Corp.		(1.00)%		Quarterly		GSCO		6/20/23		41,000		8,810		10,301		(1,491)
Carnival Corp.		(1.00)%		Quarterly		GSCO		6/20/25		39,000		10,250		11,181		(931)
Carnival Corp.		(1.00)%		Quarterly		GSCO		6/20/25		39,000		10,250		13,585		(3,335)
Carnival Corp.		(1.00)%		Quarterly		JPHQ		12/20/20		13,000		286		382		(96)
Cleveland-Cliffs Inc.		(5.00)%		Quarterly		GSCO		6/20/25		5,000		488		1,511		(1,023)
Cleveland-Cliffs Inc.		(5.00)%		Quarterly		GSCO		6/20/25		16,000		1,562		5,199		(3,637)
Cleveland-Cliffs Inc.		(5.00)%		Quarterly		GSCO		6/20/25		18,000		1,758		5,778		(4,020)
Cleveland-Cliffs Inc.		(5.00)%		Quarterly		JPHQ		6/20/25		2,000		195		524		(329)
Cleveland-Cliffs Inc.		(5.00)%		Quarterly		JPHQ		6/20/25		5,000		488		1,298		(810)
Dell Technologies Inc.		(1.00)%		Quarterly		JPHQ		6/20/25		39,000		1,264		1,790		(526)
Dell Technologies Inc.		(1.00)%		Quarterly		JPHQ		6/20/25		78,000		2,528		3,472		(944)
Dell Technologies Inc.		(1.00)%		Quarterly		JPHQ		6/20/25		178,000		5,769		7,181		(1,412)
Dow Inc.		(1.00)%		Quarterly		GSCO		6/20/25		78,000		(1,030)		(547)		(483)
Dow Inc.		(1.00)%		Quarterly		GSCO		6/20/25		78,000		(1,030)		(510)		(520)
Dow Inc.		(1.00)%		Quarterly		GSCO		6/20/25		78,000		(1,030)		(363)		(667)
Dow Inc.		(1.00)%		Quarterly		JPHQ		6/20/25		39,000		(515)		(182)		(333)
Enel SpA		(1.00)%		Quarterly		BOFA		6/20/23		85,000	EUR	(2,193)		(28)		(2,165)
Enel SpA		(1.00)%		Quarterly		MSCS		12/20/23		330,000	EUR	(9,132)		1,465		(10,597)
Garfunkelux Holdco		(5.00)%		Quarterly		GSCO		12/20/22		50,000	EUR	520		6,910		(6,390)
Garfunkelux Holdco		(5.00)%		Quarterly		GSCO		12/20/23		50,000	EUR	507		7,774		(7,267)
Government of Brazil		(1.00)%		Quarterly		BZWS		6/20/25		201,000		9,938		22,491		(12,553)
Government of China		(1.00)%		Quarterly		MSCO		6/20/25		780,000		(25,948)		(14,313)		(11,635)
Government of China		(1.00)%		Quarterly		MSCS		6/20/25		755,000		(25,116)		(16,717)		(8,399)
Government of Italy		(1.00)%		Quarterly		BOFA		6/20/24		132,000		640		2,362		(1,722)
Government of Italy		(1.00)%		Quarterly		JPHQ		6/20/24		218,000		1,058		1,816		(758)
Government of Mexico		(1.00)%		Quarterly		BOFA		6/20/25		135,000		841		11,287		(10,446)
Government of Mexico		(1.00)%		Quarterly		BOFA		6/20/25		680,000		4,237		56,864		(52,627)
Government of Mexico		(1.00)%		Quarterly		BOFA		6/20/25		695,000		4,330		63,344		(59,014)
Government of Russia		(1.00)%		Quarterly		BZWS		6/20/25		94,000		(165)		3,559		(3,724)
Groupe Casino		(5.00)%		Quarterly		BZWS		6/20/22		114,000	EUR	7,284		9,946		(2,662)
Groupe Casino		(5.00)%		Quarterly		BZWS		12/20/24		75,000	EUR	10,698		4,913		5,785
Groupe Casino		(5.00)%		Quarterly		BZWS		12/20/24		106,000	EUR	15,120		6,943		8,177
Groupe Casino		(5.00)%		Quarterly		BZWS		12/20/24		210,000	EUR	29,954		17,161		12,793
HeidelbergCement AG		(5.00)%		Quarterly		JPHQ		6/20/25		101,000	EUR	(25,993)		(14,161)		(11,832)
HeidelbergCement AG		(5.00)%		Quarterly		JPHQ		6/20/25		50,000	EUR	(12,868)		(7,584)		(5,284)
HeidelbergCement AG		(5.00)%		Quarterly		JPHQ		6/20/25		41,000	EUR	(10,552)		(6,288)		(4,264)
HeidelbergCement AG		(5.00)%		Quarterly		JPHQ		6/20/25		42,000	EUR	(10,809)		(6,152)		(4,657)
K. Hovnanian Enterprises Inc.		(5.00)%		Quarterly		BZWS		12/20/24		121,000		43,409		22,618		20,791
K. Hovnanian Enterprises Inc.		(5.00)%		Quarterly		BZWS		12/20/24		121,000		43,409		23,670		19,739
K. Hovnanian Enterprises Inc.		(5.00)%		Quarterly		BZWS		12/20/24		360,000		129,150		88,608		40,542
K. Hovnanian Enterprises Inc.		(5.00)%		Quarterly		BZWS		6/20/25		21,000		7,934		8,705		(771)
K. Hovnanian Enterprises Inc.		(5.00)%		Quarterly		JPHQ		6/20/25		4,000		1,511		1,886		(375)
K. Hovnanian Enterprises Inc.		(5.00)%		Quarterly		JPHQ		6/20/25		4,000		1,511		2,375		(864)

50

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

Credit Default Swap Contracts (continued)

Description	Periodic Payment Rate Received (Paid)		Payment Frequency		Counterparty		Maturity Date		Notional Amounta		Value		Unamortized Upfront Payments (Receipts)		Unrealized Appreciation (Depreciation)		Ratingb
OTC Swap Contracts (continued)
Contracts to Buy Protectionc (continued)
Single Name (continued)
K. Hovnanian Enterprises Inc.		(5.00)%		Quarterly		MSCO		6/20/25		6,000		$            2,267	$	3,577	$	(1,310)
Kimco Realty Corp.		(1.00)%		Quarterly		JPHQ		6/20/24		122,000		(1,329)		–		(1,329)
Kimco Realty Corp.		(1.00)%		Quarterly		JPHQ		6/20/25		121,000		(256)		1,918		(2,174)
Kohl’s Corp.		(1.00)%		Quarterly		BNPP		6/20/25		39,000		3,606		3,871		(265)
Kohl’s Corp.		(1.00)%		Quarterly		BOFA		6/20/25		42,000		3,883		7,970		(4,087)
Kohl’s Corp.		(1.00)%		Quarterly		BZWS		6/20/25		42,000		3,883		7,200		(3,317)
Kohl’s Corp.		(1.00)%		Quarterly		BZWS		6/20/25		42,000		3,883		8,037		(4,154)
Kohl’s Corp.		(1.00)%		Quarterly		BZWS		6/20/25		50,000		4,623		8,176		(3,553)
Kohl’s Corp.		(1.00)%		Quarterly		GSCO		12/20/24		302,000		23,717		5,590		18,127
Kohl’s Corp.		(1.00)%		Quarterly		GSCO		6/20/25		78,000		7,212		6,581		631
Kohl’s Corp.		(1.00)%		Quarterly		MSCO		12/20/24		153,000		12,015		2,494		9,521
Lloyds Bank PLC		(1.00)%		Quarterly		JPHQ		12/20/24		540,000	EUR	(47)		2,016		(2,063)
Loxam SAS		(5.00)%		Quarterly		FBCO		6/20/25		39,000	EUR	2,313		7,170		(4,857)
MBIA Inc.		(5.00)%		Quarterly		BZWS		6/20/22		24,000		(836)		(510)		(326)
MBIA Inc.		(5.00)%		Quarterly		CITI		6/20/21		340,000		(9,474)		(12,436)		2,962
MBIA Inc.		(5.00)%		Quarterly		CITI		6/20/22		40,000		(1,394)		(2,361)		967
MBIA Inc.		(5.00)%		Quarterly		CITI		12/20/24		112,000		(3,758)		(16,950)		13,192
MBIA Inc.		(5.00)%		Quarterly		GSCO		6/20/22		25,000		(871)		(1,167)		296
MBIA Inc.		(5.00)%		Quarterly		GSCO		12/20/24		360,000		(12,078)		(51,258)		39,180
MBIA Inc.		(5.00)%		Quarterly		JPHQ		6/20/25		16,000		(467)		(63)		(404)
MBIA Inc.		(5.00)%		Quarterly		JPHQ		6/20/25		36,000		(1,051)		831		(1,882)
NRG Energy Inc.		(5.00)%		Quarterly		BZWS		6/20/24		288,000		(42,849)		(44,606)		1,757
Petroleo Brasileiro SA		(1.00)%		Quarterly		BZWS		6/20/25		80,000		6,063		14,128		(8,065)
Petroleo Brasileiro SA		(1.00)%		Quarterly		CITI		6/20/25		53,000		4,017		9,360		(5,343)
Simon Property Group LP		(1.00)%		Quarterly		BZWS		12/20/24		240,000		1,667		1,966		(299)
Simon Property Group LP		(1.00)%		Quarterly		JPHQ		12/20/24		161,000		1,118		(3,706)		4,824
Simon Property Group LP		(1.00)%		Quarterly		MSCO		12/20/24		370,000		2,549		(7,787)		10,336
Simon Property Group LP		(1.00)%		Quarterly		MSCS		12/20/24		51,000		354		1,136		(782)
Softbank Group Corp.		(1.00)%		Quarterly		BZWS		12/20/24		2,730,000	JPY	889		4,090		(3,201)
Softbank Group Corp.		(1.00)%		Quarterly		CITI		12/20/24		96,500,000	JPY	31,433		44,781		(13,348)
Stena AB		(5.00)%		Quarterly		GSCO		6/20/24		113,000	EUR	4,619		7,739		(3,120)
Stena AB		(5.00)%		Quarterly		GSCO		6/20/24		186,000	EUR	7,603		12,467		(4,864)
Stena AB		(5.00)%		Quarterly		GSCO		6/20/25		75,000	EUR	5,037		6,574		(1,537)
Suedzucker AG		(1.00)%		Quarterly		JPHQ		6/20/25		85,000	EUR	(1,549)		3,737		(5,286)
Telecom Italia SpA		(1.00)%		Quarterly		BZWS		6/20/25		227,000	EUR	5,520		30,654		(25,134)
Transocean Inc.		(5.00)%		Quarterly		FBCO		12/20/24		356,000		261,117		197,325		63,792
Transocean Inc.		(5.00)%		Quarterly		FBCO		6/20/25		147,000		109,092		89,987		19,105
Transocean Inc.		(5.00)%		Quarterly		GSCO		12/20/24		84,000		61,612		3,277		58,335
Transocean Inc.		(5.00)%		Quarterly		GSCO		12/20/24		185,000		135,693		24,062		111,631
Transocean Inc.		(5.00)%		Quarterly		GSCO		12/20/24		534,000		391,676		40,264		351,412
Transocean Inc.		(5.00)%		Quarterly		JPHQ		12/20/24		100,000		73,348		52,442		20,906
Transocean Inc.		(5.00)%		Quarterly		JPHQ		12/20/24		434,000		318,328		62,619		255,709
Transocean Inc.		(1.00)%		Quarterly		MSCO		12/20/25		90,000		73,615		71,483		2,132
Transocean Inc.		(1.00)%		Quarterly		MSCO		12/20/25		180,000		147,231		152,136		(4,905)
Transocean Inc.		(1.00)%		Quarterly		MSCO		12/20/25		270,000		220,846		226,861		(6,015)
Unisys Corp.		(5.00)%		Quarterly		BZWS		12/20/24		20,000		(3,099)		(2,821)		(278)
Unisys Corp.		(5.00)%		Quarterly		BZWS		6/20/25		50,000		(8,188)		(7,578)		(610)
Unisys Corp.		(5.00)%		Quarterly		BZWS		6/20/25		50,000		(8,188)		(7,577)		(611)
Unisys Corp.		(5.00)%		Quarterly		BZWS		6/20/25		50,000		(8,188)		(7,331)		(857)
Unisys Corp.		(5.00)%		Quarterly		CITI		12/20/24		20,000		(3,099)		(2,910)		(189)
Unisys Corp.		(5.00)%		Quarterly		CITI		12/20/24		20,000		(3,099)		(2,778)		(321)
US Steel Corp.		(5.00)%		Quarterly		BZWS		6/20/25		25,000		6,379		7,355		(976)
US Steel Corp.		(5.00)%		Quarterly		BZWS		6/20/25		25,000		6,379		7,367		(988)
US Steel Corp.		(5.00)%		Quarterly		BZWS		6/20/25		25,000		6,379		8,269		(1,890)

51

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

Credit Default Swap Contracts (continued)

Description	Periodic Payment Rate Received (Paid)		Payment Frequency		Counterparty		Maturity Date		Notional Amounta		Value		Unamortized Upfront Payments (Receipts)		Unrealized Appreciation (Depreciation)		Ratingb
OTC Swap Contracts (continued)
Contracts to Buy Protectionc (continued)
Single Name (continued)
US Steel Corp.		(5.00)%		Quarterly		CITI		6/20/25		25,000	$	6,379	$	7,233	$	(854)
US Steel Corp.		(5.00)%		Quarterly		GSCO		6/20/25		25,000		6,379		8,269		(1,890)
US Steel Corp.		(5.00)%		Quarterly		GSCO		6/20/25		42,000		10,717		11,021		(304)
US Steel Corp.		(5.00)%		Quarterly		JPHQ		6/20/25		25,000		6,379		7,580		(1,201)
US Steel Corp.		(5.00)%		Quarterly		JPHQ		6/20/25		42,000		10,717		9,248		1,469
US Steel Corp.		(5.00)%		Quarterly		JPHQ		6/20/25		68,000		17,351		17,833		(482)
US Steel Corp.		(5.00)%		Quarterly		JPHQ		6/20/25		85,000		21,689		20,728		961
US Steel Corp.		(5.00)%		Quarterly		MSCO		6/20/25		17,000		4,338		5,784		(1,446)
US Steel Corp.		(5.00)%		Quarterly		MSCO		6/20/25		25,000		6,379		7,229		(850)
US Steel Corp.		(5.00)%		Quarterly		MSCO		6/20/25		41,000		10,462		10,408		54
Contracts to Sell Protectionc,d
Single Name
Transocean Inc.		1.00%		Quarterly		BZWS		12/20/24		180,000		(144,538)		(133,084)		(11,454)	CCC+
Transocean Inc.		1.00%		Quarterly		BZWS		12/20/24		73,000		(58,618)		(55,129)		(3,489)	CCC+
Transocean Inc.		1.00%		Quarterly		BZWS		12/20/24		37,000		(29,710)		(28,731)		(979)	CCC+
Transocean Inc.		1.00%		Quarterly		MSCO		12/20/24		270,000		(216,806)		(211,817)		(4,989)	CCC+
Transocean Inc.		1.00%		Quarterly		MSCO		12/20/24		180,000		(144,538)		(141,212)		(3,326)	CCC+
Transocean Inc.		1.00%		Quarterly		MSCO		12/20/24		90,000		(72,269)		(66,458)		(5,811)	CCC+
Total OTC Swap Contracts											$	1,430,599	$	820,489	$	610,110
Total Credit Default Swap Contracts											$	2,557,420	$	(216,939)	$	2,774,359

^a In 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.

^b Based 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.

^c Performance 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.

^d The Fund enters contracts to sell protection to create a long credit position.

52

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

At August 31, 2020, the Fund had the following interest rate swap contracts outstanding. See Note 3.

Interest Rate Swap Contracts

Description	Payment Frequency		Maturity Date		Notional Amount			Value/Unrealized Appreciation (Depreciation)
Centrally Cleared Swap Contracts
Receive Fixed 4.73%
Pay Floating Banxico Mexico 1 Month rate		Monthly		9/15/22		46,991,626	MXN	$	9,263
Receive Fixed 4.13%
Pay Floating BZDIOVRA Index		Annually		1/02/23		24,701,266	BRL		24,256
Receive Fixed 5.41%
Pay Floating Banxico Mexico 1 Month rate		Monthly		9/11/25		38,840,816	MXN		22,623
Receive Fixed 2.60%
Pay Floating CFETS China Fixing Repo 7 Day rate		Quarterly		9/16/25		18,258,030	CNY		(17,471)
Receive Fixed 6.15%
Pay Floating Banxico Mexico 1 Month rate		Monthly		9/05/30		45,566,603	MXN		45,805
Total Interest Rate Swap Contracts								$	84,476

At August 31, 2020, the Fund had the following total return swap contracts outstanding. See Note 3.

Total Return Swap Contracts

Underlying Instrument

Financing Rate

Payment Frequency

Counter- party

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts

Commodity Contracts – Longa

Bloomberg Commodity Indexb

1-Month BCOM + 0.15%

Monthly

MSCS

8/20/21

309,344

$

8,036

Equity Contracts – Longa

AA PLC

1-Month LIBOR + 0.40%

Monthly

BZWS

8/11/21

197,665

GBP

10,265

Ampol LTD

1-Month BBSW + 0.55%

Monthly

MSCS

12/22/21

1,064,189

AUD

(195,455)

Amundi SA

1-Day EONIA + 0.40%

Monthly

MSCS

3/14/25

266,038

EUR

114,540

Anima Holding SpA

1-Month EURIBOR + 0.40%

Monthly

MSCS

12/21/20

961,589

EUR

(77,702)

Barclays PLC

1-Month LIBOR + 0.40%

Monthly

MSCS

4/16/21

434,228

GBP

28,811

BNP Paribas SA

1-Month LIBOR + 0.40%

Monthly

MSCS

3/14/25

956,722

EUR

204,955

Bureau Veritas SA

1-Month EURIBOR + 0.40%

Monthly

GSCO

12/21/20

141,909

EUR

(2,752)

Bureau Veritas SA

1-Month EURIBOR + 0.40%

Monthly

MSCS

3/14/25

758,186

EUR

71,994

Carrier Global Corp.

1-Day FEDEF + 0.40%

Monthly

MSCO

12/23/20

390,005

402,327

Cie Plastic Omnium SA

1-Month EURIBOR + 0.50%

Monthly

MSCS

1/12/21

164,443

EUR

40,484

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

3/04/21

27,591

5,709

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

4/01/21

3,351

657

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

4/16/21

53,417

19,394

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

4/28/21

7,393

2,157

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

4/29/21

9,932

1,896

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

4/29/21

9,918

2,709

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/03/21

15,061

4,089

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/04/21

6,489

2,281

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/04/21

9,554

2,954

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/05/21

3,655

1,255

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/06/21

8,218

2,433

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/07/21

1,807

586

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/10/21

3,024

885

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/11/21

5,404

1,437

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/18/21

9,318

2,679

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/19/21

6,999

1,700

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/20/21

19,267

4,726

53

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counter- party

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts – Longa (continued)

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/21/21

19,120

$

4,874

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/24/21

2,396

585

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/27/21

3,220

738

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/31/21

9,835

1,992

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

7/06/21

39,797

16,470

Croda International PLC

1-Month LIBOR + 0.40%

Monthly

MSCS

4/16/21

639,023

GBP

12,260

Cummins Inc.

1-Month LIBOR + 0.50%

Monthly

MSCO

9/22/20

609,913

(2,627)

Danone SA

1-Month EURIBOR + 0.40%

Monthly

MSCO

12/21/20

508,325

EUR

3,361

Danone SA

1-Month LIBOR + 0.40%

Monthly

MSCS

3/14/25

2,704,142

EUR

134,212

EDP Renovaveis SA

1-Day EONIA + 0.65%

Monthly

MSCS

9/06/21

797,888

EUR

863,966

Elisa OYJ

1-Month EURIBOR + 0.40%

Monthly

MSCO

12/21/20

184,591

EUR

(8,945)

Elisa OYJ

1-Month EURIBOR + 0.40%

Monthly

MSCS

3/14/25

282,271

EUR

(4,592)

Eurofins Scientific SE

1-Month EURIBOR + 0.40%

Monthly

MSCS

3/14/25

4,781

EUR

3,912

Faurecia

1-Month LIBOR + 0.08%

Monthly

BZWS

3/08/21

866,675

EUR

(14,245)

Faurecia

1-Day EONIA + 0.65%

Monthly

MSCO

9/06/21

487,346

EUR

69,431

Fiat Chrysler Automobiles NV

1-Month LIBOR + 0.08%

Monthly

BZWS

3/08/21

5,382,531

EUR

(148,834)

Fiat Chrysler Automobiles NV

1-Day EONIA + 0.65%

Monthly

MSCO

9/06/21

2,704,212

EUR

690,813

Fortescue Metals Group LTD

1-Month BBSW + 0.55%

Monthly

MSCS

1/29/21

214,730

AUD

31,196

Frasers Group PLC

1-Month LIBOR + 0.40%

Monthly

MSCS

4/16/21

406,511

GBP

138,148

GrandVision NV

1-Month LIBOR + 0.05%

Monthly

BZWS

5/11/21

4,225,690

EUR

10,538

GrandVision NV

1-Day EONIA + 0.65%

Monthly

MSCS

9/06/21

1,389,474

EUR

(139,220)

Hastings Group Holdings PLC

1-Month LIBOR + 0.40%

Monthly

BZWS

8/02/21

2,019,177

GBP

(135)

HeidelbergCement AG

1-Month EURIBOR + 0.40%

Monthly

MSCS

12/21/20

1,353,063

EUR

45,010

Hermes International

1-Month EURIBOR + 0.40%

Monthly

MSCO

12/21/20

258,325

EUR

16,259

Hikma Pharmaceuticals PLC

1-Month LIBOR + 0.40%

Monthly

MSCS

4/16/21

106,925

GBP

4,569

HP Inc.

1-Month LIBOR + 0.52%

Monthly

BZWS

5/26/21

959,142

43,584

Huadian Fuxin Energy Corp.

1-Month HIBOR + 0.55%

Monthly

JPHQ

11/24/21

2,462,844

HKD

5,502

Iliad SA

1-Month LIBOR + 0.40%

Monthly

MSCS

3/14/25

120,001

EUR

88,563

Ingenico Group SA

1-Month LIBOR + 0.06%

Monthly

BZWS

5/20/21

6,522,746

EUR

(57,029)

ITV PLC

1-Month LIBOR + 0.40%

Monthly

MSCS

4/16/21

632,235

GBP

(17,928)

KAZ Minerals PLC

1-Month LIBOR + 0.50%

Monthly

MSCS

1/20/21

26,376

GBP

888

Kering SA

1-Month EURIBOR + 0.40%

Monthly

MSCO

12/21/20

608,892

EUR

49,032

Kering SA

1-Month EURIBOR + 0.40%

Monthly

MSCS

3/14/25

827,444

EUR

334,117

KGHM Polska Miedz SA

1-Month LIBOR + 1.50%

Monthly

MSCO

6/07/22

119,434

10,348

Knight-Swift Transportation Holdings Inc.

1-Month LIBOR + 0.50%

Monthly

MSCS

9/22/20

986,586

31,748

LINE Corp.

1-Month LIBOR + 0.55%

Monthly

MSCS

11/24/21

256,862,860

JPY

24,652

Lithia Motors Inc.

1-Month LIBOR + 0.50%

Monthly

MSCO

9/22/20

1,051,816

133,219

Louisiana-Pacific Corp.

1-Month LIBOR + 0.50%

Monthly

MSCS

9/22/20

719,626

187,695

LVMH Moet Hennessy Louis Vuitton

1-Day EONIA + 0.40%

Monthly

MSCS

3/14/25

231,552

EUR

83,676

McKesson Europe AG

1-Day EONIA + 0.65%

Monthly

MSCS

11/04/20

3,563,710

EUR

(3,324)

Norfolk Southern Corp.

1-Month LIBOR + 0.50%

Monthly

MSCO

9/22/20

273,487

34,803

NVR Inc.

1-Month LIBOR + 0.50%

Monthly

MSCS

9/22/20

285,163

81,500

Osram Licht AG

1-Month LIBOR + 0.03%

Monthly

BZWS

5/14/21

968,187

EUR

13,628

QUALCOMM Inc.

1-Month LIBOR + 0.50%

Monthly

MSCS

9/22/20

222,415

98,085

Rio Tinto PLC

1-Month LIBOR + 0.50%

Monthly

MSCS

9/22/20

806,609

103,289

RSA Insurance Group PLC

1-Month LIBOR + 0.40%

Monthly

MSCS

4/16/21

742,754

GBP

5,752

Ryanair Holdings PLC

1-Month EURIBOR + 0.40%

Monthly

MSCS

12/21/20

436,513

EUR

10,141

Smith & Nephew PLC

1-Month LIBOR + 0.40%

Monthly

MSCO

4/16/21

780,359

GBP

(27,961)

Smiths Group PLC

1-Month LIBOR + 0.40%

Monthly

MSCS

4/16/21

712,950

GBP

(29,241)

Societe Generale SA

1-Month LIBOR + 0.40%

Monthly

MSCS

3/14/25

621,498

EUR

(93,695)

Stroeer SE & Co. KGaA

1-Month EURIBOR + 0.40%

Monthly

MSCS

12/21/20

1,251,403

EUR

102,836

Taubman Centers Inc.

1-Month LIBOR + 0.35%

Monthly

BZWS

6/15/21

548,007

1,859

Toll Brothers Inc.

1-Month LIBOR + 0.50%

Monthly

MSCO

9/22/20

663,176

21,825

Vodafone Group PLC

1-Day SONIA + 0.65%

Monthly

MSCS

2/08/21

651,797

GBP

(130,650)

Zhongsheng Group Holdings

1-Month HIBOR + 0.95%

Monthly

MSCS

1/26/22

179,315

HKD

11,607

3,503,271

54

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment Frequency

Counter- party

Maturity Date

Notional Value*

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Shortc

Avis Budget Group Inc.

1-Day FEDEF - 0.35%

Monthly

MSCS

2/04/21

137,423

$

(34,588)

Colruyt SA

1-Day EONIA - 0.40%

Monthly

MSCS

3/14/25

1,373,519

EUR

(481,328)

DJ EURO STOXX 50 Index

1-Day EONIA - 0.45%

Monthly

MSCO

3/22/22

307,887

EUR

(124,907)

Dow Jones Industrial Average Index

1-Day FEDEF - 0.35%

Monthly

MSCO

8/01/22

110,427

(3,310)

Elisa OYJ

1-Day EONIA - 0.40%

Monthly

MSCS

3/14/25

298,648

EUR

(41,771)

Ferrari NV

1-Day EONIA - 0.50%

Monthly

MSCS

1/12/21

12,663

EUR

(5,349)

Genworth Financial Inc.

1-Day FEDEF - 0.35%

Monthly

MSCO

2/04/21

145,452

34,648

Hannover Rueck SE

1-Day EONIA - 0.35%

Monthly

MSCS

3/14/25

416,609

EUR

(116,661)

Hennes & Mauritz AB

1-Week STIBOR -  0.40%

Monthly

MSCS

3/14/25

4,131,636

SEK

(21,734)

JD Sports Fashion PLC

1-Day SONIA - 0.30%

Monthly

MSCS

4/16/21

138,201

GBP

(11,201)

L’Oreal SA

1-Day EONIA - 0.35%

Monthly

MSCS

3/14/25

401,718

EUR

(143,829)

Marks & Spencer Group PLC

1-Day SONIA - 0.30%

Monthly

MSCS

4/16/21

140,314

GBP

(1,387)

Morgan Stanley MSPSCARR Index

1-Day FEDEF - 0.35%

Monthly

MSCO

9/22/20

287,942

(134,446)

Morgan Stanley MSPSVOD Index

1-Day FEDEF - 0.39%

Monthly

MSCO

9/22/20

488,573

4,483

Morgan Stanley MSPSXLU Index

1-Day FEDEF - 0.35%

Monthly

MSCO

9/22/20

668,546

12,014

Nestle SA

1-Day SARON - 0.40%

Monthly

MSCS

3/14/25

718,967

CHF

(162,664)

Next PLC

1-Day SONIA - 0.30%

Monthly

MSCS

4/16/21

380,074

GBP

(20,920)

Nike Inc.

1-Day FEDEF - 0.35%

Monthly

MSCO

3/15/21

594,618

(38,025)

Peugeot SA

1-Month LIBOR - 0.76%

Monthly

BZWS

3/08/21

4,788,842

EUR

107,188

Peugeot SA

1-Day EONIA - 0.40%

Monthly

MSCO

9/06/21

2,418,012

EUR

(618,942)

Russell 2000 Index

1-Day FEDEF - 0.50%

Monthly

MSCS

5/03/22

243,100

2,514

S&P 500 High Beta Total Return Index

1-Month LIBOR - 0.16%

Monthly

BOFA

8/31/21

928,479

(20,484)

S&P Total Return Index

1-Month LIBOR - 0.33%

Monthly

BOFA

6/30/21

652,516

(1,577)

Swisscom AG

1-Day SARON - 0.35%

Monthly

MSCS

3/14/25

576,937

CHF

(46,000)

Worldline SA

1-Month LIBOR - 0.57%

Monthly

BZWS

5/20/21

5,512,366

EUR

1,567

(1,866,709)

Fixed Income Contracts – Longa

Government of Egypt

1-Day FEDEF

Monthly

CITI

10/15/20

422,416

9,140

Government of Indonesia

3-Month LIBOR + 1.00%

Monthly

BOFA

5/18/21

2,047,666

138,807

Government of Indonesia

3-Month LIBOR + 0.60%

Monthly

DBAB

6/15/32

2,743,329

(53,282)

94,665

Total Total Return Swap Contracts

$

1,739,263

^* 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 A portion or all of the contracts are owned by K2 Holdings Investment Corp., a wholly-owned subsidiary of the Fund. See Note 8.

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

  Abbreviations

Counterparty		Currency		Selected Portfolio
BNPP	BNP Paribas	ARS	Argentine Peso	ADR	American Depositary Receipt
BNYM	The Bank of New York Mellon Corp.	AUD	Australian Dollar	ARM	Adjustable Rate Mortgage
BOFA	Bank of America Corp.	BRL	Brazilian Real	BADLAR	Argentina Deposit Rates BADLAR Private Banks ARS
BZWS	Barclays Bank PLC	CAD	Canadian Dollar	BBSW	Bank Bill Swap Rate
CITI	Citigroup, Inc.	CHF	Swiss Franc	BCOM	Bloomberg Commodity Index
DBAB	Deutsche Bank, AG	CNY	Chinese Yuan	CAC	Cotation Assistee en Continu
FBCO	Credit Suisse Group AG	COP	Colombian Peso	CLO	Collateralized Loan Obligation
GSCO	The Goldman Sachs Group, Inc.	EGP	Egyptian Pound	CMT	Constant Maturity Treasury Index
HSBC	HSBC Bank USA, N.A.	EUR	Euro	DAX	Deutscher Aktienindex
JPHQ	JP Morgan Chase & Co.	GBP	British Pound	DJIA	Dow Jones Industrial Average

55

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Alternative Strategies Fund (continued)

MSCI	Morgan Stanley Capital International PLC	HKD	Hong Kong Dollar	EONIA	Euro OverNight Index Average
MSCO	Morgan Stanley	JPY	Japanese Yen	ETF	Exchange Traded Fund
MSCS	Morgan Stanley Capital Services LLC	MXN	Mexican Peso	EURIBOR	Euro Interbank Offered Rate
SSBT	State Street Bank and Trust Co., N.A.	NZD	New Zealand Dollar	FEDEF	Federal Funds Effective Rate
UBSW	UBS AG	RUB	Russian Ruble	FHLMC	Federal Home Loan Mortgage Corp.
		SEK	Swedish Krona	FNMA	Federal National Mortgage Association
		USD	United States Dollar	FRN	Floating Rate Note
		ZAR	South African Rand	FTSE	Financial Times Stock Exchange
Index				GO	General Obligation
CDX.NA.HY	CDX North America High Yield Index			HIBOR	Hong Kong Interbank Offer Rate
CDX.NA.IG	CDX North America Investment Grade Index			IO	Interest Only
				LIBOR	London InterBank Offered Rate
				MIB	Milano Italia Borsa
				MSCI	Morgan Stanley Capital International
				REIT	Real Estate Investment Trust
				SARON	Swiss Average Rate Overnight
				SOFR	Secured Overnight Financing Rate
				SONIA	Sterling Overnight Index Average
				SPDR	Standard & Poor’s Depositary Receipt
				STIBOR	Stockholm Interbank Offered Rate
				TOPIX	Tokyo Price Index

56

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

Statement of Investments, August 31, 2020 (unaudited)

Franklin K2 Long Short Credit Fund

	Country		Shares		Value
Common Stocks and Other Equity Interests 2.4%
Biotechnology 0.0%†
aCytodyn Inc.		United States		2,389	$	8,027
Diversified Financial Services 0.2%
a,b,cOne Call Corp.		United States		947		100,805
aRedBall Acquisition Corp.		United States		4,147		42,507
						143,312
Diversified Telecommunication Services 0.3%
aAltice Europe NV, A		Netherlands		3,416		15,082
aLiberty Global PLC, C		United Kingdom		6,944		159,781
Telecom Italia SpA		Italy		181,611		86,500
						261,363
Electric Utilities 0.2%
FirstEnergy Corp.		United States		2,579		73,734
aPG&E Corp.		United States		11,160		103,341
						177,075
Equity Real Estate Investment Trusts (REITs) 0.3%
VICI Properties Inc.		United States		11,597		259,077
Hotels, Restaurants & Leisure 0.1%
Carnival PLC		United States		8,468		116,084
Independent Power & Renewable Electricity Producers 1.2%
dClearway Energy Inc., A		United States		30,417		734,571
eClearway Energy Inc., C		United States		16,063		409,767
						1,144,338
Media 0.1%
aPostmedia Network Canada Corp., B		Canada		56,068		71,356
Paper & Forest Products 0.0%†
a,bTopco Associates LLC		United Kingdom		100,439		—
Professional Services 0.0%†
a,b,cAcosta Inc.		United States		923		8,144
Total Common Stocks and Other Equity Interests (Cost $1,618,068)						2,188,776
Convertible Preferred Stocks 0.5%
Diversified Financial Services 0.4%
a,b,cOne Call Corp., cvt. pfd.		United States		3,821		406,912
Professional Services 0.1%
a,b,cAcosta Inc., cvt. pfd.		United States		745		50,262
Total Convertible Preferred Stocks (Cost $508,603)						457,174
Preferred Stocks 0.4%
Electric Utilities 0.4%
SCE Trust II, 5.10%, pfd.		United States		2,725		67,253
SCE Trust III, 5.75%, pfd., H		United States		1,342		30,839
SCE Trust IV, 5.375%, pfd., J		United States		4,637		106,744
SCE Trust V, 5.45%, pfd., K		United States		1,605		37,252
SCE Trust VI, 5.00%, pfd.		United States		3,404		81,662
Total Preferred Stocks (Cost $284,330)						323,750

Quarterly Statement of Investments | See Notes to Consolidated Statements of Investments.

57

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*			Value
Convertible Bonds 3.2%
Automobiles 2.9%
dTesla Inc., senior note, 1.25%, 3/01/21		United States		392,000		$	2,710,445
Diversified Telecommunication Services 0.1%
fTelecom Italia SpA, senior note, Reg S, 1.125%, 3/26/22		Italy		100,000	EUR		118,288
Metals & Mining 0.2%
Cleveland-Cliffs Inc., senior note, 1.50%, 1/15/25		United States		35,000			35,712
gU.S. Steel Corp., senior note, 144A, 5.00%, 11/01/26		United States		106,000			86,730
							122,442
Total Convertible Bonds (Cost $795,942)							2,951,175
Corporate Bonds and Notes 14.5%
Aerospace & Defense 0.4%
gTriumph Group Inc., senior secured note, 144A, 8.875%, 6/01/24		United States		349,000			369,286
Air Freight & Logistics 0.1%
United Parcel Service Inc., senior bond, 4.45%, 4/01/30		United States		48,000			60,441
Airlines 0.7%
gMileage Plus Holdings LLC / Mileage Plus Intellectual Property Assets Ltd., senior secured note, 144A, 6.50%, 6/20/27		United States		291,000			304,095
Southwest Airlines Co., senior note,
4.75%, 5/04/23		United States		68,000			72,596
5.25%, 5/04/25		United States		204,000			222,884
5.125%, 6/15/27		United States		57,000			62,253
							661,828
Banks 0.7%
hBank of America Corp., senior bond, FRN, 2.676%, (SOFR + 1.93%), 6/19/41		United States		134,000			136,825
hCitigroup Inc., senior bond, FRN, 2.572%, (SOFR + 2.11%), 6/03/31		United States		103,000			108,982
JPMorgan Chase & Co., senior note,
2.005%, 3/13/26		United States		60,000			62,688
2.083%, 4/22/26		United States		48,000			50,425
fVTB Bank OJSC Via VTB Capital SA, loan participation, sub. senior note, Reg S, 6.95%, 10/17/22		Russia		200,000			214,186
Wells Fargo & Co., senior note,
2.406%, 10/30/25		United States		56,000			59,031
2.164%, 2/11/26		United States		44,000			45,920
							678,057
Beverages 0.1%
The Coca-Cola Co., senior bond, 1.65%, 6/01/30		United States		71,000			73,689
Capital Markets 0.6%
geG Global Finance PLC, senior secured note, 144A,
4.375%, 2/07/25		United Kingdom		192,000	EUR		218,885
6.25%, 10/30/25		United Kingdom		261,000	EUR		313,875
							532,760
Commercial Services & Supplies 0.7%
gVericast Corp., senior note, 144A, 9.25%, 3/01/21		United States		626,500			632,373
Communications Equipment 0.3%
gRiverbed Technology Inc., senior note, 144A, 8.875%, 3/01/23		United States		344,000			242,520
Construction & Engineering 0.1%
Fluor Corp.,
senior bond, 4.25%, 9/15/28		United States		27,000			21,621

58

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*			Value
Corporate Bonds and Notes (continued)
Construction & Engineering (continued)
Fluor Corp., (continued)
senior note, 1.75%, 3/21/23		United States		100,000	EUR	$	89,023
							110,644
Containers & Packaging 0.1%
g,iIntelligent Packaging Ltd. Finco Inc. / Intelligent Packaging Ltd. Co.-Issuer LLC, senior secured note, 144A, 6.00%, 9/15/28		Canada		92,000			94,070
Diversified Financial Services 0.7%
fAmigo Luxembourg SA, senior secured note, Reg S, 7.625%, 1/15/24		United Kingdom		100,000	GBP		75,833
f,hGarfunkelux Holdco 3 SA, senior secured note, FRN, Reg S, 4.50%, (3-Month EURIBOR + 4.50%), 9/01/23		Luxembourg		100,000	EUR		110,907
gOne Call Corp., senior secured note, first lien, 144A, 7.50%, 7/01/24		United States		469,056			457,329
							644,069
Diversified Telecommunication Services 0.2%
gAltice France SA, senior secured note, 144A, 3.375%, 1/15/28		France		158,000	EUR		187,303
Electric Utilities 1.1%
Duke Energy Indiana LLC, secured bond, 2.75%, 4/01/50		United States		48,000			49,459
Edison International,
senior bond, 4.125%, 3/15/28		United States		43,000			44,906
senior note, 5.75%, 6/15/27		United States		42,000			47,799
fEskom Holdings SOC Ltd., senior bond, Reg S,
5.75%, 1/26/21		South Africa		222,000			217,745
8.45%, 8/10/28		South Africa		200,000			193,519
Florida Power & Light Co., secured bond, 3.95%, 3/01/48		United States		48,000			61,363
Pacific Gas & Electric Co.,
secured bond, 4.50%, 7/01/40		United States		52,175			54,906
secured note, 3.15%, 1/01/26		United States		46,720			48,433
Southern California Edison Co.,
secured bond, 3.65%, 2/01/50		United States		59,000			62,863
senior bond, 4.65%, 10/01/43		United States		25,000			29,036
senior bond, 4.00%, 4/01/47		United States		33,000			35,973
senior bond, C, 4.125%, 3/01/48		United States		19,000			21,072
secured note, E, 3.70%, 8/01/25		United States		83,000			92,507
Virginia Electric And Power Co., senior bond, 3.30%, 12/01/49		United States		48,000			56,072
							1,015,653
Energy Equipment & Services 0.3%
gTransocean Inc., senior note, 144A,
7.50%, 1/15/26		United States		797,000			255,040
8.00%, 2/01/27		United States		100,000			31,125
							286,165
Food & Staples Retailing 0.3%
f,h,jCasino Guichard Perrachon SA, E, junior sub. bond, FRN, Reg S, 3.992%, (EUR 5 Year Swap + 3.82%), Perpetual		France		500,000	EUR		252,197
gRite AID Corp., senior secured note, 144A, 8.00%, 11/15/26		United States		65,000			66,137
							318,334
Hotels, Restaurants & Leisure 0.8%
Carnival PLC, senior bond, 1.00%, 10/28/29		United States		100,000	EUR		67,107
McDonald’s Corp., senior bond, 3.625%, 9/01/49		United States		48,000			53,757
gRoyal Caribbean Cruises Ltd., 144A,
senior note, 9.125%, 6/15/23		United States		266,000			280,298
senior secured note, 11.50%, 6/01/25		United States		183,000			212,348

59

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*			Value
Corporate Bonds and Notes (continued)
Hotels, Restaurants & Leisure (continued)
fTUI AG, senior note, Reg S, 2.125%, 10/26/21		Germany		100,000	EUR	$	100,375
							713,885
Household Durables 0.4%
gK. Hovnanian Enterprises Inc., senior secured note, 144A, 10.00%, 11/15/25		United States		559,000			361,952
Household Products 0.0%†
The Procter & Gamble Co., senior bond, 3.00%, 3/25/30		United States		20,000			23,140
Insurance 0.0%†
g,hAmbac LSNI LLC, senior secured note, 144A, FRN, 6.00%, (3-Month USD LIBOR + 5.00%), 2/12/23		Cayman Islands		7			7
IT Services 0.2%
Fiserv Inc., senior note, 2.25%, 6/01/27		United States		48,000			50,959
Global Payments Inc., senior bond, 4.15%, 8/15/49		United States		54,000			63,674
Visa Inc., senior bond, 1.10%, 2/15/31		United States		34,000			33,174
							147,807
Marine 0.1%
gStena International SA, senior secured bond, 144A, 5.75%, 3/01/24		Sweden		100,000			95,865
Media 0.5%
gCedar Fair LP / Canada’s Wonderland Co. / Magnum Management Corp. / Millennium Op, senior secured note, 144A, 5.50%, 5/01/25		United States		112,000			115,780
Charter Communications Operating LLC / Charter Communications Operating Capital, senior secured bond,
2.80%, 4/01/31		United States		59,000			62,128
6.484%, 10/23/45		United States		34,000			45,544
5.375%, 5/01/47		United States		29,000			34,953
5.75%, 4/01/48		United States		73,000			91,322
5.125%, 7/01/49		United States		14,000			16,352
3.70%, 4/01/51		United States		126,000			125,448
							491,527
Metals & Mining 0.5%
gCSN Islands XI Corp., senior note, 144A, 6.75%, 1/28/28		Brazil		200,000			192,104
gU.S. Steel Corp., senior secured note, 144A, 12.00%, 6/01/25		United States		290,000			307,838
							499,942
Multiline Retail 0.2%
Kohl’s Corp., senior note, 9.50%, 5/15/25		United States		136,000			163,881
Oil, Gas & Consumable Fuels 2.4%
Hurricane Finance PLC, senior note, 8.00%, 10/15/25		United Kingdom		134,000			190,992
fLeviathan Bond Ltd., senior note, Reg S,
6.50%, 6/30/27		Israel		75,871			79,289
6.75%, 6/30/30		Israel		40,157			41,966
gMoss Creek Resources Holdings Inc., senior note, 144A,
7.50%, 1/15/26		United States		6,000			4,131
10.50%, 5/15/27		United States		169,000			120,284
Petrobras Global Finance BV,
senior bond, 6.90%, 3/19/49		Brazil		153,000			176,824
senior note, 8.75%, 5/23/26		Brazil		257,000			325,330
Petroleos Mexicanos,
gsenior bond, 144A, 5.95%, 1/28/31		Mexico		87,000			78,705
senior bond, 6.375%, 1/23/45		Mexico		152,000			125,115
senior bond, 6.75%, 9/21/47		Mexico		316,000			264,391
senior bond, 6.35%, 2/12/48		Mexico		301,000			243,139

60

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*		Value
Corporate Bonds and Notes (continued)
Oil, Gas & Consumable Fuels (continued)
Petroleos Mexicanos, (continued)
gsenior bond, 144A, 6.95%, 1/28/60		Mexico		101,000	$	84,194
senior note, 3.50%, 1/30/23		Mexico		135,000		134,448
senior note, 4.50%, 1/23/26		Mexico		53,000		49,654
Qep Resources Inc.,
senior bond, 5.375%, 10/01/22		United States		68,000		59,739
senior bond, 5.25%, 5/01/23		United States		193,000		158,742
senior note, 5.625%, 3/01/26		United States		71,000		45,841
gTallgrass Energy Partners LP / Tallgrass Energy Finance Corp., senior note, 144A, 4.75%, 10/01/23		United States		11,000		10,814
						2,193,598
Paper & Forest Products 0.1%
gPaper Industries Intermediate Financing SARL, senior secured note, 144A, 6.00%, 3/01/25		Luxembourg		52,666		48,079
Pharmaceuticals 0.4%
Eli Lilly & Co., senior bond, 2.25%, 5/15/50		United States		67,000		63,701
gRoyalty Pharma PLC, senior bond, 144A,
2.20%, 9/02/30		United States		67,000		66,264
3.30%, 9/02/40		United States		33,000		32,300
3.55%, 9/02/50		United States		67,000		64,502
gUpjohn Inc., senior bond, 144A,
2.70%, 6/22/30		United States		40,000		41,797
3.85%, 6/22/40		United States		40,000		43,463
4.00%, 6/22/50		United States		90,000		98,345
						410,372
Road & Rail 0.1%
gAvis Budget Car Rental LLC / Avis Budget Finance Inc., 144A,
senior bond, 5.25%, 3/15/25		United States		17,000		16,284
senior note, 6.375%, 4/01/24		United States		100,000		98,365
						114,649
Semiconductors & Semiconductor Equipment 0.0%†
QUALCOMM Inc., senior bond, 3.25%, 5/20/50		United States		35,000		39,510
Software 0.5%
Microsoft Corp., senior bond, 2.525%, 6/01/50		United States		269,000		282,600
Oracle Corp., senior bond, 3.60%, 4/01/50		United States		48,000		53,767
gVeritas U.S. Inc. / Veritas Bermuda Ltd., senior secured note, 144A, 7.50%, 9/01/25		United States		87,000		90,465
						426,832
Specialty Retail 1.4%
gCarvana Co., senior note, 144A, 8.875%, 10/01/23		United States		573,000		601,764
L Brands Inc., senior bond, 5.625%, 2/15/22		United States		26,000		26,773
gVericast Corp./Harland Clarke, senior secured note, 144A, 12.50%, 5/01/24		United States		654,830		674,475
						1,303,012
Technology Hardware, Storage & Peripherals 0.1%
Apple Inc., senior bond,
1.65%, 5/11/30		United States		36,000		37,337
3.85%, 5/04/43		United States		47,000		57,712
2.65%, 5/11/50		United States		35,000		36,102
						131,151
Wireless Telecommunication Services 0.4%
gT-Mobile USA Inc., 144A,
senior secured bond, 3.875%, 4/15/30		United States		164,000		187,642

61

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*		Value
Corporate Bonds and Notes (continued)
Wireless Telecommunication Services (continued)
gT-Mobile USA Inc., 144A, (continued)
senior secured bond, 2.55%, 2/15/31		United States		35,000	$	36,641
senior secured note, 3.75%, 4/15/27		United States		73,000		82,630
senior secured note, 2.05%, 2/15/28		United States		47,000		48,200
						355,113
Total Corporate Bonds and Notes (Cost $13,250,370)						13,427,514
Corporate Bonds and Notes in Reorganization 1.6%
Diversified Telecommunication Services 1.6%
kFrontier Communications Corp.,
senior bond, 7.125%, 1/15/23		United States		66,000		27,266
senior bond, 6.875%, 1/15/25		United States		32,000		12,880
senior bond, 9.00%, 8/15/31		United States		188,000		77,673
d,gsenior secured note, 144A, 8.00%, 4/01/27		United States		849,000		854,587
g,kIntelsat Jackson Holdings SA, senior secured note, first lien, 144A, 9.50%, 9/30/22		Luxembourg		454,000		495,321
						1,467,727
Oil, Gas & Consumable Fuels 0.0%†
g,kAmerican Energy- Permian Basin LLC, senior secured note, 144A, 12.00%, 10/01/24		United States		962,000		24,050
Total Corporate Bonds and Notes in Reorganization (Cost $2,312,360)						1,491,777
hSenior Floating Rate Interests 3.6%
Airlines 0.2%
United Airlines Holdings Inc., Term Loan B, 6.25%, (3-Month USD LIBOR + 5.25%), 7/02/27		United States		149,158		150,532
Communications Equipment 0.5%
Riverbed Technology Inc., Term Loan B, 4.25%, (1-Month USD LIBOR + 3.25%), 4/24/22		United States		549,499		489,398
Diversified Consumer Services 0.8%
Advantage Sales & Marketing Inc.,
Term Loan 1L, 4.25%, (1-Month USD LIBOR + 3.25%), 7/23/21		United States		478,173		455,631
Term Loan B2, 4.25%, (1-Month USD LIBOR + 3.25%), 7/23/21		United States		275,661		262,665
						718,296
Diversified Telecommunication Services 1.1%
Intelsat Jackson Holdings SA,
Term Loan B3, 8.00%, (6-Month USD LIBOR + 3.75%), 11/27/23		United States		281,120		284,283
Term Loan B4, 8.75%, (1-Month USD LIBOR + 4.50%), 1/02/24		United States		16,979		17,179
Term Loan B5, 8.625%, (6-Month USD LIBOR + 6.63%), 1/02/24		United States		329,824		333,711
lTerm Loan DIP, 6.50%, (1-Month USD LIBOR + 5.50%), 7/14/21		United States		333,953		340,771
						975,944
Electronic Equipment, Instruments & Components 0.2%
Veritas U.S. Inc., Term Loan B, 6.50%, (3-Month USD LIBOR + 4.50%), 9/01/25		United States		205,248		201,721

62

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*			Value
hSenior Floating Rate Interests (continued)
Hotels, Restaurants & Leisure 0.2%
Caesars Resort Collection LLC, Term Loan B,
4.703%, (3-Month USD LIBOR + 4.50%), 7/21/25		United States		118,454		$	115,171
4.772%, (3-Month USD LIBOR + 4.50%), 7/21/25		United States		59,227			57,586
							172,757
Personal Products 0.1%
lCoty Inc., Term Loan B, 2.405%, (1-Month USD LIBOR + 2.25%), 4/07/25		United States		156,851			139,049
Specialty Retail 0.5%
PETCO Animal Supplies Inc., Term Loan B1, 4.25%, (3-Month USD LIBOR + 3.25%), 1/26/23		United States		106,996			91,983
PetSmart Inc., Term Loan B2, 5.00%, (1-Month USD LIBOR + 4.00%), 3/11/22		United States		413,472			413,522
							505,505
Total Senior Floating Rate Interests (Cost $3,258,062)							3,353,202
Foreign Government and Agency Securities 5.6%
Government of Argentina,
senior bond, 7.125%, 6/28/17		Argentina		82,000			35,772
senior note, 6.875%, 1/26/27		Argentina		127,000			56,961
senior note, 5.875%, 1/11/28		Argentina		405,000			181,647
fGovernment of Bahrain, senior bond, Reg S, 7.00%, 1/26/26		Bahrain		200,000			228,719
Government of Egypt, senior bond,
g144A, 8.875%, 5/29/50		Egypt		200,000			209,160
fReg S, 8.70%, 3/01/49		Egypt		200,000			207,002
fGovernment of Germany, senior bond, Reg S, 0.50%, 2/15/25		Germany		94,000	EUR		118,123
Government of Italy, senior note, 2.375%, 10/17/24		Italy		373,000			386,629
gGovernment of Jordan, senior note, 144A, 4.95%, 7/07/25		Jordan		200,000			200,311
Government of Mexico, senior bond,
4.75%, 4/27/32		Mexico		200,000			229,400
5.00%, 4/27/51		Mexico		200,000			231,050
fGovernment of Nigeria, senior note, Reg S, 7.625%, 11/21/25		Nigeria		200,000			212,960
fGovernment of Paraguay, senior bond, Reg S, 4.625%, 1/25/23		Paraguay		421,000			447,733
Government of Russia,
senior bond, 6225, 7.25%, 5/10/34		Russia		24,782,000	RUB		364,879
fsenior bond, Reg S, 5.25%, 6/23/47		Russia		200,000			272,568
senior note, 6227, 7.40%, 7/17/24		Russia		37,531,000	RUB		549,625
senior note, 6229, 7.15%, 11/12/25		Russia		43,267,000	RUB		633,703
senior note, 6232, 6.00%, 10/06/27		Russia		29,540,000	RUB		406,623
gGovernment of Saudi Arabia, senior bond, 144A, 2.75%, 2/03/32		Saudi Arabia		221,000			230,105
Total Foreign Government and Agency Securities (Cost $4,923,226)							5,202,970
U.S. Government and Agency Securities (Cost $914,517) 1.0%
U.S. Treasury Note,
0.25%, 7/31/25		United States		40,000			39,970
0.50%, 6/30/27		United States		78,000			78,122
0.375%, 7/31/27		United States		88,000			87,340

63

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*		Value
U.S. Government and Agency Securities (continued)
U.S. Treasury Note, (continued)
0.625%, 5/15/30		United States		717,700	$	712,934
Total U.S. Government and Agency Securities (Cost $914,517)						918,366
Asset-Backed Securities and Commercial Mortgage-Backed Securities 53.4%
Diversified Financial Services 29.1%
g,mACIS CLO Ltd., 2014-5A, D, 144A, FRN, 4.591%, (3-Month USD LIBOR + 4.34%), 11/01/26		United States		1,120,000		1,102,747
nAdjustable Rate Mortgage Trust, 2005-4, 3A1, FRN, 4.093%, 8/25/35		United States		63,994		62,372
g,nAMSR Trust, 144A, FRN,
2019-SFR1, H, 6.04%, 1/19/39		United States		750,000		719,365
2019-SFR1, I, 8.976%, 1/19/39		United States		750,000		723,425
g,mAshford Hospitality Trust, 2018-ASHF, E, 144A, FRN, 3.262%, (1-Month USD LIBOR + 3.10%), 4/15/35		United States		550,000		482,093
g,mAtlas Senior Loan Fund III Ltd., 2017-1A, DR, 144A, FRN, 2.88%, (3-Month USD LIBOR + 2.60%), 11/17/27		United States		1,320,000		1,111,546
mBear Stearns ALT-A Trust, 2004-6, B1, FRN, 3.025%, (1-Month USD LIBOR + 2.85%), 7/25/34		United States		346,495		354,157
g,mBXMT Ltd., 2020-FL2, C, 144A, FRN, 1.812%, (1-Month USD LIBOR + 1.65%), 2/16/37		United States		1,300,000		1,256,125
CD Mortgage Trust, 2019-CD8, C, 3.719%, 8/15/57		United States		384,000		365,742
nChase Mortgage Finance Trust, 2007-A1, 11M1, FRN, 3.642%, 3/25/37		United States		23,532		22,786
CitiMortgage Alternative Loan Trust, 2007-A1, 2A1, 5.50%, 1/25/22		United States		29,017		28,583
g,nComm Mortgage Trust, 2013-CR8, D, 144A, FRN, 4.083%, 6/10/46		United States		1,000,000		955,092
g,mCutwater 2014-II Ltd., 2017-2A, CR, 144A, FRN, 4.025%, (3-Month USD LIBOR + 3.75%), 1/15/27		United States		1,000,000		943,450
g,mCVP Cascade CLO-2 Ltd., 2014-2A, C, 144A, FRN, 4.072%, (3-Month USD LIBOR + 3.80%), 7/18/26		United States		700,000		662,582
Delta Funding Home Equity Loan Trust, 2000-2, M2, 8.86%, 8/15/30		United States		293,917		265,784
g,nFREMF Mortgage Trust, 2019-KW09, B, 144A, FRN, 4.148%, 5/25/29		United States		300,000		299,389
n,oFRESB Mortgage Trust, 2020-SB76, X1, IO, FRN, 1.317%, 5/25/30		United States		2,998,538		210,816
g,mGoldentree Loan Management US CLO 6 Ltd., 2019-6A, C, 144A, FRN, 2.872%, (3-Month USD LIBOR + 2.60%), 1/20/33		United States		1,000,000		1,005,002
g,mGPMT Ltd., 2019-FL2, D, 144A, FRN, 3.121%, (1-Month USD LIBOR + 2.95%), 2/22/36		United States		1,000,000		930,300
GSAA Trust, 2006-7, AF3, 6.22%, 3/25/46		United States		255,075		144,994
gGSMSC Pass-Through Trust, 144A, FRN,
m2009-4R, 2A3, 0.622%, (1-Month USD LIBOR + 0.45%), 12/26/36		United States		756,719		485,942
n2009-5R, 3A2, 5.50%, 10/26/35		United States		173,065		172,268
g,mHull Street CLO Ltd., 2014-1A, D, 144A, FRN, 3.872%, (3-Month USD LIBOR + 3.60%), 10/18/26		United States		1,130,000		900,679
g,mJFIN CLO Ltd., 2017-1A, DR, 144A, FRN, 2.963%, (3-Month USD LIBOR + 2.65%), 3/15/26		United States		650,000		580,795
g,mKREF Ltd., 2018-FL1, D, 144A, FRN, 2.712%, (1-Month USD LIBOR + 2.55%), 6/15/36		United States		300,000		282,038

64

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*		Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Diversified Financial Services (continued)
MASTR Adjustable Rate Mortgages Trust, FRN,
n2004-10, B1, 3.669%, 10/25/34		United States		537,289	$	474,200
m2006-OA1, 1A1, 0.385%, (1-Month USD LIBOR + 0.21%), 4/25/46		United States		328,917		294,385
g,mMorgan Stanley RE-REMIC Trust, 2013-R8, 2B2, 144A, FRN, 1.012%, (1-Month USD LIBOR + 0.42%), 9/26/36		United States		1,011,880		652,156
g,mMountain View CLO Ltd., 2018-1A, DRR, 144A, FRN, 3.925%, (3-Month USD LIBOR + 3.65%), 10/15/26		United States		1,290,000		1,199,941
g,mOHA Credit Funding 4 Ltd., 2019-4A, C, 144A, FRN, 2.908%, (3-Month USD LIBOR + 2.65%), 10/22/32		United States		1,500,000		1,501,841
gProgress Residential Trust, 2017-SFR2, C, 144A, 3.395%, 12/17/34		United States		350,000		352,531
gSapphire Aviation Finance I Ltd., 2018-1A, B, 144A, 5.926%, 3/15/40		United States		746,997		516,105
nSeasoned Credit Risk Transfer Trust, FRN,
g2016-1, M2, 144A, 3.75%, 9/25/55		United States		500,000		451,697
2017-3, M1, 4.00%, 7/25/56		United States		40,000		39,924
g2020-2, M, 144A, 4.25%, 11/25/59		United States		300,000		284,876
gS-Jets Ltd., 2017-1, A, 144A, 3.967%, 8/15/42		Bermuda		780,829		705,463
g,mStaniford Street CLO Ltd., 2014-1A, D, 144A, FRN, 3.813%, (3-Month USD LIBOR + 3.50%), 6/15/25		United States		1,160,000		1,144,492
nSTARM Mortgage Loan Trust, 2007-2, 4A1, FRN, 3.858%, 4/25/37		United States		79,465		60,188
mSuntrust Alternative Loan Trust, 2005-1F, 1A1, FRN, 0.825%, (1-Month USD LIBOR + 0.65%), 12/25/35		United States		205,060		168,151
mTerwin Mortgage Trust, 2003-6HE, M2, FRN, 2.80%, (1-Month USD LIBOR + 2.63%), 11/25/33		United States		144,756		139,254
gThunderbolt II Aircraft Lease Ltd., 2018-A, A, 144A, 4.147%, 9/15/38		United States		2,657,400		2,472,457
nUBS Commercial Mortgage Trust, 2018-C10, C, FRN, 5.259%, 5/15/51		United States		800,000		821,847
g,nVisio Trust, 2020-1, A3, 144A, FRN, 3.521%, 8/25/55		United States		250,000		249,642
Wells Fargo Alternative Loan Trust, 2007-PA3, 2A2, 6.00%, 7/25/37		United States		148,746		148,111
nWells Fargo Mortgage Backed Securities Trust, 2006-AR13, A2, FRN, 3.079%, 9/25/36		United States		153,842		139,538
g,mWestchester CLO Ltd., 2007-1A, E, 144A, FRN, 4.551%, (3-Month USD LIBOR + 4.30%), 8/01/22		United States		661,203		661,727
g,mZAIS CLO 1 Ltd., 2018-1A, CR, 144A, FRN, 3.685%, (3-Month USD LIBOR + 3.41%), 4/15/28		United States		512,552		426,324
						26,972,922
Metals & Mining 1.1%
g,mPalmer Square Loan Funding Ltd., 2019-2A, B, 144A, FRN, 2.522%, (3-Month USD LIBOR + 2.25%), 4/20/27		United States		1,000,000		983,778
Mortgage Real Estate Investment Trusts (REITs) 23.2%
nAmerican Home Mortgage Assets Trust, 2005-1, 1A1, FRN, 3.89%, 11/25/35		United States		115,726		98,127
nBanc of America Mortgage Trust, FRN,
2005-K, 2A1, 3.792%, 12/25/35		United States		209,363		196,623
2005-L, 1A1, 4.141%, 1/25/36		United States		134,733		124,699
2005-L, 3A1, 3.996%, 1/25/36		United States		287,647		262,628
g,nBCAP LLC Trust, 2010-RR1, 1A4, 144A, FRN, 3.643%, 3/26/37		United States		276,764		235,777
nBear Stearns ARM Trust, FRN,
2002-11, 1A2, 3.752%, 2/25/33		United States		4,584		4,122

65

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*		Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Mortgage Real Estate Investment Trusts (REITs) (continued)
nBear Stearns ARM Trust, FRN, (continued)
2006-2, 4A1, 3.653%, 7/25/36		United States		49,484	$	44,851
Citigroup Mortgage Loan Trust, FRN,
m2004-OPT1, M4, 1.18%, (1-Month USD LIBOR + 1.01%), 10/25/34		United States		588,602		537,391
n2007-AR5, 2A1A, 4.167%, 4/25/37		United States		115,483		109,036
g,m2008-RR1, A1A1, 144A, 0.245%, (1-Month USD LIBOR + 0.07%), 1/25/37		United States		640,134		562,557
Countrywide Alternative Loan Trust,
2005-73CB, 1A2, 6.25%, 1/25/36		United States		169,896		175,698
m2005-IM1, A1, FRN, 0.775%, (1-Month USD LIBOR + 0.60%), 1/25/36		United States		147,544		136,092
2005-J10, 2A4, 6.00%, 10/25/35		United States		439,161		314,481
2006-4CB, 2A3, 5.50%, 4/25/36		United States		73,950		70,365
CS First Boston Mortgage Securities Corp.,
2002-9, 1A2, 7.50%, 3/25/32		United States		466,695		495,641
n2004-AR3, CB2, FRN, 3.61%, 4/25/34		United States		128,194		119,149
g,m2004-CF2, 2M2, 144A, FRN, 1.575%, (1-Month USD LIBOR + 1.40%), 5/25/44		United States		252,027		236,614
CSMC Mortgage-Backed Trust, 2006-4, 9A1, 6.50%, 5/25/36		United States		811,958		431,469
g,nFHLMC Seasoned Credit Risk Transfer Trust, 2017-2, M1, 144A, FRN, 4.00%, 8/25/56		United States		1,170,000		1,163,986
gFHLMC Structured Agency Credit Risk Debt Notes, 144A, FRN,
n2017-SPI1, M2, 3.984%, 9/25/47		United States		899,469		892,581
m2018-HRP1, B2, 11.925%, (1-Month USD LIBOR + 11.75%), 4/25/43		United States		3,026,254		2,866,806
n2018-SPI1, M2, 3.722%, 2/25/48		United States		693,000		677,767
n2018-SPI2, M2, 3.811%, 5/25/48		United States		753,272		742,988
n2018-SPI3, B, 4.14%, 8/25/48		United States		249,920		165,977
m2020-DNA4, M2, 3.908%, (1-Month USD LIBOR + 3.75%), 8/25/50		United States		1,000,000		1,010,950
nFirst Horizon Alternative Mortgage Securities Trust, 2004-AA2, 2A1, FRN, 2.748%, 8/25/34		United States		207,315		205,044
GSR Mortgage Loan Trust,
2004-6F, 2A4, 5.50%, 5/25/34		United States		168,025		174,892
n2005-AR6, B1, FRN, 3.787%, 9/25/35		United States		610,047		546,056
b2007-1F, 1A1, 5.00%, 12/25/35		United States		54,380		75,021
Impac CMB Trust,
2004-4, 2A2, 4.94%, 9/25/34		United States		162,883		174,604
m2004-8, 3B, FRN, 2.80%, (1-Month USD LIBOR + 2.63%), 8/25/34		United States		127,922		124,008
m2005-2, 2B, FRN, 2.65%, (1-Month USD LIBOR + 2.48%), 4/25/35		United States		94,935		89,876
m2005-4, 2B1, FRN, 2.65%, (1-Month USD LIBOR + 2.48%), 5/25/35		United States		140,137		134,341
m2005-4, 2M1, FRN, 0.925%, (1-Month USD LIBOR + 0.75%), 5/25/35		United States		163,493		148,706
m2005-8, 2B, FRN, 2.425%, (1-Month USD LIBOR + 2.25%), 2/25/36		United States		126,330		121,370
IndyMac INDX Mortgage Loan Trust, FRN,
m2004-AR14, 2A1A, 0.895%, (1-Month USD LIBOR + 0.72%), 1/25/35		United States		614,856		513,421
n2005-AR21, 4A1, 3.39%, 10/25/35		United States		296,680		274,654

66

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*		Value
Asset-Backed Securities and Commercial Mortgage-Backed Securities (continued)
Mortgage Real Estate Investment Trusts (REITs) (continued)
IndyMac INDX Mortgage Loan Trust, FRN, (continued)
m2006-AR12, A1, 0.365%, (1-Month USD LIBOR + 0.19%), 9/25/46		United States		113,041	$	101,455
m2006-AR29, A2, 0.255%, (1-Month USD LIBOR + 0.08%), 11/25/36		United States		145,551		134,833
g,mJPMorgan Chase Commercial Mortgage Securities Trust, 2018-ASH8, F, 144A, FRN, 4.162%, (1-Month USD LIBOR + 4.00%), 2/15/35		United States		850,000		656,074
JPMorgan Mortgage Acquisition Trust, 2007-CH2, AF2, 4.602%, 1/25/37		United States		170,742		127,439
nJPMorgan Mortgage Trust, FRN,
2006-A5, 6A1, 3.658%, 8/25/36		United States		273,951		242,124
2006-A7, 2A3, 3.795%, 1/25/37		United States		126,431		116,422
2007-A2, 2A1, 3.749%, 4/25/37		United States		183,879		165,958
g2019-2, B4, 144A, 4.624%, 8/25/49		United States		584,080		574,804
g,o2019-8, B1X, 144A, IO, 1.25%, 3/25/50		United States		816,323		38,071
g,o2019-8, B2X, 144A, IO, 1.00%, 3/25/50		United States		1,224,534		45,369
g,o2019-8, B3X, 144A, IO, 0.75%, 3/25/50		United States		784,839		21,751
Lehman Mortgage Trust, 2005-3, 2A3, 5.50%, 1/25/36		United States		76,636		79,387
nMASTR Alternative Loan Trust, 2007-HF1, 3A1, FRN, 2.918%, 10/25/47		United States		669,667		473,962
nMASTR Seasoned Securitization Trust, 2004-1, 4A1, FRN, 3.561%, 10/25/32		United States		46,890		46,650
mNew Century Home Equity Loan Trust, 2003-4, M1, FRN, 1.30%, (1-Month USD LIBOR + 1.13%), 10/25/33		United States		508,918		502,543
nRALI Series Trust, FRN,
2005-QA8, NB2, 3.56%, 7/25/35		United States		69,021		61,756
2005-QA8, NB3, 4.519%, 7/25/35		United States		63		63
nRFMSI Trust, 2007-SA2, 3A, FRN, 5.108%, 4/25/37		United States		1,032,212		466,716
mSecuritized Asset Backed Receivables LLC Trust, 2004-OP2, A2, FRN, 0.875%, (1-Month USD LIBOR + 0.70%), 8/25/34		United States		199,024		183,203
nStructured ARM Loan Trust, FRN,
2004-2, 1A1, 4.146%, 3/25/34		United States		125,432		122,564
2004-4, B1, 3.704%, 4/25/34		United States		440,688		401,885
nWachovia Mortgage Loan Trust LLC, 2005-B, 1A1, FRN, 3.642%, 10/20/35		United States		371,314		354,629
mWaMu Mortgage Pass-Through Certificates Trust, 2007-OA3, 2A1A, FRN, 1.931%, (1 Year CMT + 0.76%), 4/25/47		United States		55,397		50,788
mWashington Mutual Mortgage Pass-Through Certificates, 2006-4, 3A2B, FRN, 0.255%, (1-Month USD LIBOR + 0.08%), 5/25/36		United States		278,469		211,160
nWashington Mutual MSC Mortgage Pass-Through Certificates Series Trust, FRN,
2003-AR2, M, 2.947%, 5/25/33		United States		930,239		871,799
b2003-AR3, B1, 3.584%, 6/25/33		United States		246,345		227,392
nWells Fargo Commercial Mortgage Trust, 2018-C48, C, FRN, 5.291%, 1/15/52		United States		900,000		936,339
						21,473,504
Total Asset-Backed Securities and Commercial Mortgage-Backed Securities (Cost $50,874,051)						49,430,204

67

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*			Value
Municipal Bonds in Reorganization 1.1%
Puerto Rico 1.1%
kPuerto Rico Commonwealth GO, Public Improvement, Refunding, Series A,
5.50%, 7/01/39		United States		155,000		$	102,687
5.00%, 7/01/41		United States		225,000			140,906
kPuerto Rico Commonwealth GO, Refunding, Series A, 8.00%, 7/01/35		United States		1,330,000			812,963
Total Municipal Bonds in Reorganization (Cost $873,250)							1,056,556
	Number of Contracts		Notional   Amount#
Options Purchased 0.1%
Calls - Exchange-Traded 0.0%†
Tapestry Inc., September Strike Price $15.00, Expires 9/18/20		25		2,500			1,600
Puts - Exchange-Traded 0.0%†
American Airlines Group Inc., November Strike Price $15.00, Expires 11/20/20		33		3,300			11,847
Bed Bath & Beyond Inc., January Strike Price $4.00, Expires 1/15/21		112		11,200			1,680
The Boeing Co., January Strike Price $150.00, Expires 1/15/21		11		1,100			15,895
Dow Inc., January Strike Price $35.00, Expires 1/15/21		26		2,600			3,172
							32,594
Puts - Over-the-Counter 0.1%
American Airlines Group Inc., Counterparty JPHQ, November Strike Price $15.00, Expires 11/20/20		32		3,200			11,488
American Airlines Group Inc., Counterparty JPHQ, January Strike Price $15.00, Expires 1/15/21		40		4,000			17,000
Casino Guichard-Perrachon SA, Counterparty BOFA, December Strike Price 20.00 EUR, Expires 12/18/20		18		1,800			3,609
CoStar Group Inc., Counterparty GSCO, October Strike Price $500.00, Expires 10/16/20		10		1,000			5,000
							37,097
Total Options Purchased (Cost $133,551)							71,291
Total Investments before Short Term Investments (Cost $79,746,330)							80,872,755
	Country		Principal   Amount*
Short Term Investments 7.3%
Corporate Bonds and Notes (Cost $73,190) 0.1%
Specialty Retail 0.1%
L Brands Inc., senior bond, 6.625%, 4/01/21		United States		77,000			79,272
Credit-Linked Notes 0.2%
b,gCitigroup Global Markets Holdings Inc., senior note, (Egypt), 144A, zero cpn., 10/22/20		Egypt		2,529,000	EGP		156,423
f,gHSBC Bank PLC, senior note, (Egypt), 144A, Reg S, zero cpn., 10/15/20		Egypt		1,275,000	EGP		79,163
Total Credit-Linked Notes (Cost $234,020)							235,586

68

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Shares		Value
Short Term Investments (continued)
Money Market Funds (Cost $3,331,800) 3.6%
pFidelity Investments Money Market Government Portfolio, Institutional, 0.01%		United States		3,331,800	$	3,331,800
			Principal             Amount*
Repurchase Agreements (Cost $3,147,401) 3.4%
qJoint Repurchase Agreement, 0.068%, 9/01/20 (Maturity Value $3,147,407)		United States		3,147,401		3,147,401
BNP Paribas Securities Corp. (Maturity Value $2,380,226)
Deutsche Bank Securities Inc. (Maturity Value $235,143)
HSBC Securities (USA) Inc. (Maturity Value $532,038)
Collateralized by U.S. Government Agency Securities, 3.00% - 5.00%, 11/20/42 - 7/20/50; U.S. Government Agency Strips, 8/15/22 - 11/15/43:
rU.S. Treasury Bills, 1/19/21; and U.S. Treasury Notes, 1.75%, 5/31/22  (valued at $3,212,113)
Total Investments (Cost $86,532,741) 94.7%						87,666,814
Options Written (0.0)%†						(11,248)
Securities Sold Short (10.9)%						(10,129,046)
Other Assets, less Liabilities 16.2%						15,030,989
Net Assets 100.0%					$	92,557,509
	Number of Contracts		Notional Amount#
Options Written (0.0)%†
Calls - Over-the-Counter (0.0)%†
Clearway Energy Inc., C, Counterparty GSCO, November Strike Price $25.00, Expires 11/20/20		50		5,000		(10,000)
Puts - Exchange-Traded (0.0)%†
Dow Inc., January Strike Price $27.50, Expires 1/15/21		26		2,600		(1,248)
Total Options Written (Premiums Received $14,059)						(11,248)
	Country		Shares
Securities Sold Short (10.9)%
Common Stocks (3.2)%
Automobiles (2.9)%
Tesla Inc.		United States		5,460		(2,720,827)
Hotels, Restaurants & Leisure (0.2)%
Carnival Corp.		United States		8,470		(139,586)
Professional Services (0.1)%
CoStar Group Inc.		United States		95		(80,617)
Total Common Stocks (Proceeds $856,146)						(2,941,030)

69

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*			Value
Securities Sold Short (continued)
Corporate Bonds and Notes (5.7)%
Aerospace & Defense (0.2)%
Triumph Group Inc., senior note, 5.25%, 6/01/22		United States		198,000		$	(155,136)
Airlines (0.4)%
gAmerican Airlines Inc., senior secured note, 144A, 11.75%, 7/15/25		United States		348,000			(334,778)
Banks (0.1)%
f,h,jChina Zheshang Bank Co. Ltd., junior sub. bond, FRN, Reg S, 5.45%, (US 5 Year CMT T-Note + 3.52%), Perpetual		China		72,000			(73,454)
Chemicals (0.2)%
The Dow Chemical Co.,
senior bond, 4.80%, 5/15/49		United States		119,000			(142,554)
senior note, 4.80%, 11/30/28		United States		68,000			(82,555)
							(225,109)
Construction & Engineering (0.5)%
Fluor Corp., senior bond, 3.50%, 12/15/24		United States		153,000			(119,872)
gTutor Perini Corp., senior note, 144A, 6.875%, 5/01/25		United States		302,000			(291,430)
fWebuild SpA, senior note, Reg S, 1.75%, 10/26/24		Italy		82,000	EUR		(87,626)
							(498,928)
Containers & Packaging (0.0)%†
gFlex Acquisition Co. Inc., senior note, 144A, 7.875%, 7/15/26		United States		15,000			(15,781)
Diversified Financial Services (0.9)%
AerCap Ireland Capital DAC/AerCap Global Aviation Trust,
senior bond, 3.65%, 7/21/27		Ireland		174,000			(162,289)
senior bond, 3.875%, 1/23/28		Ireland		207,000			(190,786)
senior note, 4.875%, 1/16/24		Ireland		174,000			(179,487)
senior note, 6.50%, 7/15/25		Ireland		255,000			(277,627)
							(810,189)
Diversified Telecommunication Services (0.3)%
fDkt Finance Aps, senior secured note, Reg S, 7.00%, 6/17/23		Denmark		200,000	EUR		(242,985)
Energy Equipment & Services (0.1)%
fSaipem Finance International BV, E, senior note, Reg S, 2.625%, 1/07/25		Italy		100,000	EUR		(119,540)
Equity Real Estate Investment Trusts (REITs) (0.5)%
gIron Mountain Inc., senior bond, 144A, 5.25%, 3/15/28		United States		249,000			(262,494)
Kimco Realty Corp., senior note, 1.90%, 3/01/28		United States		86,000			(84,738)
Simon Property Group LP, senior bond, 2.65%, 7/15/30		United States		100,000			(100,352)
							(447,584)
Hotels, Restaurants & Leisure (0.2)%
RHP Hotel Properties LP / RHP Finance Corp., senior note, 4.75%, 10/15/27		United States		186,000			(169,574)
Independent Power & Renewable Electricity Producers (0.4)%
NRG Energy Inc.,
gsenior bond, 144A, 5.25%, 6/15/29		United States		356,000			(388,864)
senior note, 5.75%, 1/15/28		United States		17,000			(18,527)
							(407,391)

70

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*			Value
Securities Sold Short (continued)
Corporate Bonds and Notes (continued)
Marine (0.1)%
fCMA CGM SA, senior note, Reg S, 6.50%, 7/15/22		France		82,000	EUR	$	(96,021)
Media (0.2)%
gDiamond Sports Group LLC / Diamond Sports Finance Co., senior secured note, 144A, 5.375%, 8/15/26		United States		145,000			(113,450)
Meredith Corp., senior note, 6.875%, 2/01/26		United States		77,000			(67,053)
							(180,503)
Mortgage Real Estate Investment Trusts (REITs) (0.1)%
gBrookfield Property REIT Inc. / BPR Cumulus LLC / BPR Nimbus LLC / GGSI Sellco LLC, senior secured note, 144A, 5.75%, 5/15/26		United States		131,000			(107,071)
Multiline Retail (0.1)%
gMacy’s Inc., senior secured note, 144A, 8.375%, 6/15/25		United States		79,000			(83,034)
Oil, Gas & Consumable Fuels (0.2)%
gTallgrass Energy Partners LP / Tallgrass Energy Finance Corp., senior bond, 144A, 5.50%, 1/15/28		United States		214,000			(196,432)
Personal Products (0.1)%
gCoty Inc., senior note, 144A, 6.50%, 4/15/26		United States		53,000			(43,823)
Professional Services (0.1)%
fTeleperformance, senior note, Reg S, 1.875%, 7/02/25		France		100,000	EUR		(127,246)
Road & Rail (0.1)%
gAvis Budget Car Rental LLC / Avis Budget Finance Inc., senior secured note, 144A, 10.50%, 5/15/25		United States		70,000			(81,452)
Software (0.3)%
gVeritas U.S. Inc. / Veritas Bermuda Ltd., senior note, 144A, 10.50%, 2/01/24		United States		312,000			(312,747)
Specialty Retail (0.3)%
gPetSmart Inc., senior note, 144A, 8.875%, 6/01/25		United States		231,000			(240,067)
Wireless Telecommunication Services (0.3)%
fSoftbank Group Corp., senior bond, Reg S, 5.125%, 9/19/27		Japan		300,000			(316,447)
Total Corporate Bonds and Notes (Proceeds $5,037,447)							(5,285,292)
Foreign Government and Agency Securities (0.2)%
Government of Italy, senior bond,
fReg S, 5.00%, 3/01/25		Italy		88,000	EUR		(126,364)
5.25%, 11/01/29		Italy		63,000	EUR		(103,007)
Total Foreign Government and Agency Securities (Proceeds $204,365)							(229,371)
U.S. Government and Agency Securities (1.8)%
U.S. Treasury Bond,
1.125%, 5/15/40		United States		121,000			(118,826)
2.00%, 2/15/50		United States		749,800			(844,052)
1.25%, 5/15/50		United States		133,000			(125,467)

71

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

	Country		Principal Amount*		Value
Securities Sold Short (continued)
U.S. Government and Agency Securities (continued)
U.S. Treasury Note,
0.25%, 6/30/25		United States		320,000	$	(319,850)
0.50%, 5/31/27		United States		231,000		(231,437)
0.625%, 8/15/30		United States		34,000		(33,721)
Total U.S. Government and Agency Securities (Proceeds $1,679,765)						(1,673,353)
Total Securities Sold Short (Proceeds $7,777,723)					$	(10,129,046)

^† 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 units specified in the contract, and can 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 Fair valued using significant unobservable inputs. See Note 9 regarding fair value measurements.

^c See Note 5 regarding restricted securities.

^d 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 August 31, 2020, the aggregate value of these securities and/or cash pledged amounted to $13,647,511, representing 14.7% of net assets.

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

^f Security was purchased pursuant to Regulation S under the Securities Act of 1933, which exempts from registration securities offered and sold outside of the United States. Such a security 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 August 31, 2020, the net value of these securities was $1,780,890, representing 1.9% of net assets.

^g Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers or in public offering registered under the Securities Act of 1933. At August 31, 2020, the net value of these securities was $41,239,941, representing 44.6% of net assets.

^h The coupon rate shown represents the rate at period end.

ⁱ A portion or all of the security purchased on a delayed delivery basis.

^j Perpetual security with no stated maturity date.

^k Defaulted security or security for which income has been deemed uncollectible.

^l See Note 6 regarding unfunded loan commitments.

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

ⁿ Adjustable rate security with an interest rate that is not based on a published reference index and spread. The rate is based on the structure of the agreement and current market conditions. The coupon rate shown represents the rate at period end.

^o Investment in an interest-only security entitles holders to receive only the interest payment on the underlying instruments. The principal amount shown is the notional amount of the underlying instruments.

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

^q Investment is through participation in a joint account with other funds managed by the investment manager or an affiliate of the investment manager. At August 31, 2020, all repurchase agreements had been entered into on that date.

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

72

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

At August 31, 2020, the Fund had the following futures contracts outstanding. See Note 3.

Futures Contracts

Description	Type		Number of Contracts		Notional Amount*		Expiration Date		Value/Unrealized Appreciation (Depreciation)
Equity Contracts
S&P 500 E-Mini Index		Short		3		$ 524,835		9/18/20		$ (71,287)
Total Futures Contracts										$ (71,287)

^* As of period end.

At August 31, 2020, the Fund had the following forward exchange contracts outstanding. See Note 3.

Forward Exchange Contracts

Currency	Counterpartya		Type		Quantity		Contract Amount		Settlement Date		Unrealized Appreciation		Unrealized Depreciation
OTC Forward Exchange Contracts
Euro		JPHQ		Buy		88,371	$	99,427		9/16/20	$	6,068	$	–
Euro		JPHQ		Sell		88,371		97,200		9/16/20		–		(8,295	)
Indonesian Rupiah		JPHQ		Sell		14,961,923,656		973,401		9/16/20		–		(52,463	)
Russian Ruble		JPHQ		Buy		15,325,371		207,361		9/16/20		500		(1,328	)
Russian Ruble		JPHQ		Sell		139,334,721		1,897,130		9/16/20		19,377		–
South African Rand		JPHQ		Buy		2,834,216		160,887		9/16/20		6,011		–
Thai Baht		JPHQ		Buy		10,882,105		341,212		9/16/20		8,420		–
Thai Baht		JPHQ		Sell		10,882,105		341,025		9/16/20		–		(8,606	)
British Pound		JPHQ		Sell		320,000		418,336		9/30/20		–		(9,517	)
Euro		JPHQ		Sell		1,750,000		1,962,958		9/30/20		–		(126,819	)
Total Forward Exchange Contracts											$	40,376	$	(207,028	)
Net unrealized appreciation (depreciation)													$	(166,652	)

^a May be comprised of multiple contracts with the same counterparty, currency and settlement date.

73

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

At August 31, 2020, the Fund had the following credit default swap contracts outstanding. See Note 3.

Credit Default Swap Contracts

Description	Periodic Payment Rate Received (Paid)			Payment Frequency			Maturity Date		Notional Amounta		Value		Unamortized Upfront Payments (Receipts)		Unrealized Appreciation (Depreciation)		Ratingb
Centrally Cleared Swap Contracts
Contracts to Buy Protectionc
Single Name
Government of Malaysia		(1.00)	%		Quarterly			12/20/24		435,000	$	(11,010)	$	(11,526)	$	516
Government of Mexico		(1.00)	%		Quarterly			6/20/23		186,000		(1,777)		(26)		(1,751)
Government of Mexico		(1.00)	%		Quarterly			12/20/23		966,000		(6,468)		(3,881)		(2,587)
Government of Mexico		(1.00)	%		Quarterly			12/20/23		15,000		(100)		(232)		132
Government of South Africa		(1.00)	%		Quarterly			12/20/24		903,000		64,394		26,642		37,752
Government of South Africa		(1.00)	%		Quarterly			12/20/24		900,000		64,180		26,654		37,526
Government of South Korea		(1.00)	%		Quarterly			6/20/24		602,327		(19,115)		(20,613)		1,498
Government of South Korea		(1.00)	%		Quarterly			12/20/24		395,000		(13,620)		(12,919)		(701)
Government of Turkey		(1.00)	%		Quarterly			6/20/22		6,000		413		316		97
Government of Turkey		(1.00)	%		Quarterly			6/20/24		462,000		66,038		46,374		19,664
Traded Index
CDX.NA.HY.25		(5.00)	%		Quarterly			12/20/20		1,241,000		(14,099)		24,992		(39,091)
CDX.NA.HY.34		(5.00)	%		Quarterly			6/20/25		3,487,500		(201,672)		18,396		(220,068)
CDX.NA.IG.34		(1.00)	%		Quarterly			6/20/25		9,120,000		(151,319)		(87,301)		(64,018)
Contracts to Sell Protectionc,d
Single Name
Government of South Africa		1.00	%		Quarterly			12/20/24		786,000		(56,051)		(61,217)		5,166	BB-
Government of South Africa		1.00	%		Quarterly			12/20/24		184,000		(13,121)		(5,367)		(7,754)	BB-
Government of Turkey		1.00	%		Quarterly			12/20/22		136,000		(12,001)		(6,150)		(5,851)	B+
Total Centrally Cleared Swap Contracts											$	(305,328)	$	(65,858)	$	(239,470)
OTC Swap Contracts
Contracts to Buy Protectionc
Single Name				Counterparty
Avis Budget Group, Inc.		(5.00)	%		Quarterly	BZWS		12/20/24		27,000		(88)		2,744		(2,832)
Avis Budget Group, Inc.		(5.00)	%		Quarterly	BZWS		12/20/24		27,000		(88)		3,049		(3,137)
Avis Budget Group, Inc.		(5.00)	%		Quarterly	BZWS		12/20/24		45,000		(146)		5,288		(5,434)
Avis Budget Group, Inc.		(5.00)	%		Quarterly	GSCO		12/20/24		27,000		(88)		2,683		(2,771)
Avis Budget Group, Inc.		(5.00)	%		Quarterly	JPHQ		12/20/24		18,000		(59)		2,115		(2,174)
Avis Budget Group, Inc.		(5.00)	%		Quarterly	MSCO		12/20/24		18,000		(59)		1,788		(1,847)
Beazer Homes USA, Inc.		(5.00)	%		Quarterly	BZWS		6/20/25		35,000		(4,102)		6,620		(10,722)
Beazer Homes USA, Inc.		(5.00)	%		Quarterly	GSCO		6/20/25		36,000		(4,219)		(1,549)		(2,670)
Beazer Homes USA, Inc.		(5.00)	%		Quarterly	MSCO		6/20/25		36,000		(4,219)		7,648		(11,867)
Best Buy Co. Inc.		(5.00)	%		Quarterly	BOFA		12/20/24		45,000		(9,500)		(6,588)		(2,912)
Best Buy Co. Inc.		(5.00)	%		Quarterly	BOFA		12/20/24		45,000		(9,500)		(6,374)		(3,126)
Best Buy Co. Inc.		(5.00)	%		Quarterly	BZWS		12/20/24		45,000		(9,500)		(7,213)		(2,287)
Best Buy Co. Inc.		(5.00)	%		Quarterly	GSCO		12/20/24		135,000		(28,501)		(22,155)		(6,346)
Best Buy Co. Inc.		(5.00)	%		Quarterly	GSCO		12/20/24		72,000		(15,201)		(10,062)		(5,139)
Best Buy Co. Inc.		(5.00)	%		Quarterly	GSCO		12/20/24		27,000		(5,700)		(3,763)		(1,937)
Best Buy Co. Inc.		(5.00)	%		Quarterly	GSCO		12/20/24		19,000		(4,011)		(2,516)		(1,495)
Best Buy Co. Inc.		(5.00)	%		Quarterly	GSCO		6/20/25		81,000		(18,835)		(9,660)		(9,175)
Carnival Corp.		(1.00)	%		Quarterly	BZWS		6/20/23		35,000		7,521		8,935		(1,414)
Carnival Corp.		(1.00)	%		Quarterly	BZWS		6/20/23		36,000		7,736		9,005		(1,269)
Carnival Corp.		(1.00)	%		Quarterly	BZWS		6/20/25		100,000		26,282		27,437		(1,155)
Carnival Corp.		(1.00)	%		Quarterly	CITI		6/20/23		18,000		3,868		4,583		(715)
Carnival Corp.		(1.00)	%		Quarterly	CITI		6/20/25		13,000		3,417		3,727		(310)
Carnival Corp.		(1.00)	%		Quarterly	FBCO		6/20/23		57,000		12,248		14,320		(2,072)

74

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

Credit Default Swap Contracts (continued)

Description	Periodic Payment Rate Received (Paid)			Payment Frequency		Counterparty		Maturity Date		Notional Amounta			Value		Unamortized Upfront Payments (Receipts)		Unrealized Appreciation (Depreciation)		Ratingb
OTC Swap Contracts (continued)
Contracts to Buy Protectionc (continued)
Single Name (continued)
Carnival Corp.		(1.00)	%		Quarterly		GSCO		12/20/20		14,000		$	308	$	888	$	(580)
Carnival Corp.		(1.00)	%		Quarterly		GSCO		6/20/23		36,000			7,736		8,603		(867)
Carnival Corp.		(1.00)	%		Quarterly		GSCO		6/20/23		36,000			7,736		9,045		(1,309)
Carnival Corp.		(1.00)	%		Quarterly		GSCO		6/20/25		33,000			8,673		9,460		(787)
Carnival Corp.		(1.00)	%		Quarterly		GSCO		6/20/25		33,000			8,673		11,495		(2,822)
Carnival Corp.		(1.00)	%		Quarterly		JPHQ		12/20/20		11,000			242		323		(81)
CenturyLink Inc.		(1.00)	%		Quarterly		BZWS		12/20/23		63,000			2,445		4,569		(2,124)
CenturyLink Inc.		(1.00)	%		Quarterly		BZWS		12/20/23		63,000			2,445		4,613		(2,168)
CenturyLink Inc.		(1.00)	%		Quarterly		GSCO		12/20/23		38,000			1,475		2,728		(1,253)
CenturyLink Inc.		(1.00)	%		Quarterly		JPHQ		12/20/23		89,000			3,454		6,477		(3,023)
Cleveland-Cliffs Inc.		(5.00)	%		Quarterly		GSCO		6/20/25		4,000			391		1,209		(818)
Cleveland-Cliffs Inc.		(5.00)	%		Quarterly		GSCO		6/20/25		13,000			1,269		4,224		(2,955)
Cleveland-Cliffs Inc.		(5.00)	%		Quarterly		GSCO		6/20/25		15,000			1,465		4,815		(3,350)
Cleveland-Cliffs Inc.		(5.00)	%		Quarterly		JPHQ		6/20/25		1,000			98		263		(165)
Cleveland-Cliffs Inc.		(5.00)	%		Quarterly		JPHQ		6/20/25		4,000			391		1,039		(648)
Dell Technologies Inc.		(1.00)	%		Quarterly		JPHQ		6/20/25		26,000			843		1,049		(206)
Dell Technologies Inc.		(1.00)	%		Quarterly		JPHQ		6/20/25		33,000			1,070		1,515		(445)
Dell Technologies Inc.		(1.00)	%		Quarterly		JPHQ		6/20/25		66,000			2,139		2,938		(799)
Dow Inc.		(1.00)	%		Quarterly		GSCO		6/20/25		66,000			(872)		(463)		(409)
Dow Inc.		(1.00)	%		Quarterly		GSCO		6/20/25		66,000			(872)		(432)		(440)
Dow Inc.		(1.00)	%		Quarterly		GSCO		6/20/25		66,000			(872)		(308)		(564)
Dow Inc.		(1.00)	%		Quarterly		JPHQ		6/20/25		33,000			(436)		(154)		(282)
Garfunkelux Holdco		(5.00)	%		Quarterly		GSCO		12/20/22		50,000	EUR		520		6,910		(6,390)
Garfunkelux Holdco		(5.00)	%		Quarterly		GSCO		12/20/23		50,000	EUR		507		7,774		(7,267)
Government of Brazil		(1.00)	%		Quarterly		BZWS		6/20/25		182,000			8,999		20,365		(11,366)
Government of Italy		(1.00)	%		Quarterly		BOFA		6/20/24		233,000			1,130		1,858		(728)
Government of Italy		(1.00)	%		Quarterly		BOFA		6/20/24		140,000			679		2,506		(1,827)
Government of Russia		(1.00)	%		Quarterly		BZWS		6/20/25		72,000			(127)		2,725		(2,852)
Groupe Casino		(5.00)	%		Quarterly		BZWS		6/20/22		71,000	EUR		4,537		6,195		(1,658)
Groupe Casino		(5.00)	%		Quarterly		JPHQ		12/20/24		244,000	EUR		34,804		17,836		16,968
Heidelbergcement AG		(5.00)	%		Quarterly		JPHQ		6/20/25		85,000	EUR		(21,875)		(11,917)		(9,958)
Heidelbergcement AG		(5.00)	%		Quarterly		JPHQ		6/20/25		43,000	EUR		(11,066)		(6,522)		(4,544)
Heidelbergcement AG		(5.00)	%		Quarterly		JPHQ		6/20/25		36,000	EUR		(9,265)		(5,521)		(3,744)
Heidelbergcement AG		(5.00)	%		Quarterly		JPHQ		6/20/25		36,000	EUR		(9,265)		(5,273)		(3,992)
Itochu Corp.		(1.00)	%		Quarterly		GSCO		6/20/22		17,300,000	JPY		(3,066)		(1,858)		(1,208)
Itochu Corp.		(1.00)	%		Quarterly		JPHQ		6/20/22		4,307,000	JPY		(763)		(477)		(286)
JFE Holdings Inc.		(1.00)	%		Quarterly		GSCO		6/20/22		5,746,000	JPY		(911)		(636)		(275)
JFE Holdings Inc.		(1.00)	%		Quarterly		JPHQ		6/20/22		3,802,000	JPY		(603)		(428)		(175)
K. Hovnanian Enterprises Inc.		(5.00)	%		Quarterly		BZWS		6/20/24		38,000			12,821		12,266		555
K. Hovnanian Enterprises Inc.		(5.00)	%		Quarterly		BZWS		12/20/24		96,000			34,440		17,944		16,496
K. Hovnanian Enterprises Inc.		(5.00)	%		Quarterly		BZWS		12/20/24		96,000			34,440		18,779		15,661
K. Hovnanian Enterprises Inc.		(5.00)	%		Quarterly		BZWS		12/20/24		113,000			40,539		32,195		8,344
K. Hovnanian Enterprises Inc.		(5.00)	%		Quarterly		BZWS		6/20/25		18,000			6,801		7,462		(661)
K. Hovnanian Enterprises Inc.		(5.00)	%		Quarterly		GSCO		9/20/24		68,000			23,692		20,590		3,102
K. Hovnanian Enterprises Inc.		(5.00)	%		Quarterly		GSCO		12/20/24		57,000			20,449		16,240		4,209
K. Hovnanian Enterprises Inc.		(5.00)	%		Quarterly		JPHQ		6/20/25		4,000			1,511		1,886		(375)
K. Hovnanian Enterprises Inc.		(5.00)	%		Quarterly		JPHQ		6/20/25		4,000			1,511		2,375		(864)
K. Hovnanian Enterprises Inc.		(5.00)	%		Quarterly		MSCO		12/20/24		34,000			12,197		10,682		1,515
K. Hovnanian Enterprises Inc.		(5.00)	%		Quarterly		MSCO		6/20/25		5,000			1,889		2,981		(1,092)
Kimco Realty Corp.		(1.00)	%		Quarterly		JPHQ		6/20/24		121,000			(1,318)		210		(1,528)
Kimco Realty Corp.		(1.00)	%		Quarterly		JPHQ		6/20/25		109,000			(231)		1,727		(1,958)
Kohl’s Corp.		(1.00)	%		Quarterly		BNPP		6/20/25		34,000			3,144		3,375		(231)
Kohl’s Corp.		(1.00)	%		Quarterly		BOFA		6/20/25		36,000			3,329		6,832		(3,503)
Kohl’s Corp.		(1.00)	%		Quarterly		BZWS		6/20/25		36,000			3,329		6,172		(2,843)
Kohl’s Corp.		(1.00)	%		Quarterly		BZWS		6/20/25		36,000			3,329		6,889		(3,560)

75

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

Credit Default Swap Contracts (continued)

Description	Periodic Payment Rate Received (Paid)			Payment Frequency		Counterparty		Maturity Date		Notional Amounta			Value		Unamortized Upfront Payments (Receipts)		Unrealized Appreciation (Depreciation)		Ratingb
OTC Swap Contracts (continued)
Contracts to Buy Protectionc (continued)
Single Name (continued)
Kohl’s Corp.		(1.00)	%		Quarterly		BZWS		6/20/25		48,000		$	4,438	$	7,849	$	(3,411)
Kohl’s Corp.		(1.00)	%		Quarterly		GSCO		12/20/24		183,000			11,700		1,628		10,072
Kohl’s Corp.		(1.00)	%		Quarterly		GSCO		6/20/25		69,000			6,380		5,822		558
Kohl’s Corp.		(1.00)	%		Quarterly		MSCO		12/20/24		221,000			17,355		3,603		13,752
Kohl’s Corp.		(1.00)	%		Quarterly		MSCS		12/20/24		24,000			1,534		704		830
Lloyds Bank PLC		(1.00)	%		Quarterly		BOFA		12/20/22		196,000	EUR		(2,872)		(1,154)		(1,718)
Lloyds Bank PLC		(1.00)	%		Quarterly		GSCO		12/20/23		210,000	EUR		(3,269)		237		(3,506)
Lloyds Bank PLC		(1.00)	%		Quarterly		GSCO		6/20/24		127,000	EUR		(4,296)		756		(5,052)
Lloyds Bank PLC		(1.00)	%		Quarterly		JPHQ		12/20/22		196,000	EUR		(2,872)		(1,253)		(1,619)
Lloyds Bank PLC		(1.00)	%		Quarterly		JPHQ		12/20/23		67,000	EUR		(1,043)		734		(1,777)
Lloyds Bank PLC		(1.00)	%		Quarterly		JPHQ		12/20/24		121,000	EUR		(11)		3,121		(3,132)
Loxam SAS		(5.00)	%		Quarterly		FBCO		6/20/25		33,000	EUR		1,957		6,067		(4,110)
Marubeni Corp.		(1.00)	%		Quarterly		CITI		6/20/25		4,807,000	JPY		(1,389)		1,370		(2,759)
Marubeni Corp.		(1.00)	%		Quarterly		GSCO		6/20/22		27,269,000	JPY		(4,299)		(2,422)		(1,877)
Marubeni Corp.		(1.00)	%		Quarterly		JPHQ		6/20/22		6,291,000	JPY		(992)		(591)		(401)
Marubeni Corp.		(1.00)	%		Quarterly		JPHQ		6/20/25		2,404,000	JPY		(695)		589		(1,284)
MBIA Inc.		(5.00)	%		Quarterly		BZWS		6/20/22		23,000			(802)		(490)		(312)
MBIA Inc.		(5.00)	%		Quarterly		CITI		6/20/22		36,000			(1,255)		(2,125)		870
MBIA Inc.		(5.00)	%		Quarterly		GSCO		6/20/22		21,000			(732)		(981)		249
MBIA Inc.		(5.00)	%		Quarterly		GSCO		6/20/25		10,000			(292)		286		(578)
MBIA Inc.		(5.00)	%		Quarterly		JPHQ		6/20/21		269,000			(7,495)		(6,844)		(651)
MBIA Inc.		(5.00)	%		Quarterly		JPHQ		12/20/24		143,000			(4,798)		(17,350)		12,552
MBIA Inc.		(5.00)	%		Quarterly		JPHQ		6/20/25		14,000			(409)		(55)		(354)
MBIA Inc.		(5.00)	%		Quarterly		JPHQ		6/20/25		31,000			(905)		715		(1,620)
Mitsui O.S.K. Lines Ltd.		(1.00)	%		Quarterly		JPHQ		6/20/22		9,678,000	JPY		(1,000)		(267)		(733)
Mitsui O.S.K. Lines Ltd.		(1.00)	%		Quarterly		JPHQ		6/20/22		3,618,000	JPY		(374)		(100)		(274)
NRG Energy Inc.		(5.00)	%		Quarterly		GSCO		6/20/24		24,000			(3,571)		(3,180)		(391)
Petroleo Brasileiro S/A Petrobras		(1.00)	%		Quarterly		BZWS		6/20/25		73,000			5,533		12,892		(7,359)
Petroleo Brasileiro S/A Petrobras		(1.00)	%		Quarterly		CITI		6/20/25		49,000			3,714		8,654		(4,940)
Simon Property Group LP		(1.00)	%		Quarterly		JPHQ		12/20/24		434,000			3,014		(10,425)		13,439
Simon Property Group LP		(1.00)	%		Quarterly		MSCO		12/20/24		340,000			2,361		(7,155)		9,516
Softbank Group Corp.		(1.00)	%		Quarterly		BZWS		12/20/23		12,747,000	JPY		2,597		3,676		(1,079)
Softbank Group Corp.		(1.00)	%		Quarterly		BZWS		6/20/24		6,374,000	JPY		1,635		1,854		(219)
Softbank Group Corp.		(1.00)	%		Quarterly		BZWS		6/20/24		12,747,000	JPY		3,270		3,769		(499)
Softbank Group Corp.		(1.00)	%		Quarterly		BZWS		6/20/24		25,494,000	JPY		6,540		6,170		370
Softbank Group Corp.		(1.00)	%		Quarterly		CITI		6/20/24		12,746,000	JPY		3,270		3,978		(708)
Softbank Group Corp.		(1.00)	%		Quarterly		GSCO		12/20/23		12,747,000	JPY		2,597		3,456		(859)
Softbank Group Corp.		(1.00)	%		Quarterly		GSCO		12/20/23		12,747,000	JPY		2,597		3,603		(1,006)
Stena AB		(5.00)	%		Quarterly		GSCO		6/20/24		100,000	EUR		4,088		6,703		(2,615)
Stena AB		(5.00)	%		Quarterly		GSCO		6/20/25		32,000	EUR		2,149		2,805		(656)
Suedzucker AG		(1.00)	%		Quarterly		JPHQ		6/20/25		73,000	EUR		(1,330)		3,210		(4,540)
Telecom Italia SpA		(1.00)	%		Quarterly		BZWS		6/20/25		213,000	EUR		5,179		28,763		(23,584)
Transocean Inc.		(5.00)	%		Quarterly		FBCO		12/20/24		146,000			107,087		80,925		26,162
Transocean Inc.		(5.00)	%		Quarterly		FBCO		6/20/25		132,000			97,960		80,805		17,155
Transocean Inc.		(5.00)	%		Quarterly		GSCO		12/20/24		48,000			35,207		6,243		28,964
Transocean Inc.		(5.00)	%		Quarterly		GSCO		12/20/24		239,000			175,301		17,591		157,710
Transocean Inc.		(5.00)	%		Quarterly		GSCO		6/20/25		110,000			81,634		75,631		6,003
Transocean Inc.		(5.00)	%		Quarterly		JPHQ		12/20/24		4,000			2,934		576		2,358
Transocean Inc.		(5.00)	%		Quarterly		JPHQ		12/20/24		138,000			101,220		19,912		81,308
Transocean Inc.		(5.00)	%		Quarterly		JPHQ		12/20/24		100,000			73,348		52,442		20,906
Transocean Inc.		(5.00)	%		Quarterly		JPHQ		6/20/25		200,000			148,425		134,618		13,807
Transocean Inc.		(5.00)	%		Quarterly		MSCO		12/20/24		20,000			14,670		2,719		11,951
Transocean Inc.		(1.00)	%		Quarterly		MSCO		12/20/25		37,000			30,264		29,387		877

76

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

Credit Default Swap Contracts (continued)

Description	Periodic Payment Rate Received (Paid)			Payment Frequency		Counterparty		Maturity Date		Notional Amounta			Value		Unamortized Upfront Payments (Receipts)		Unrealized Appreciation (Depreciation)		Ratingb
OTC Swap Contracts (continued)
Contracts to Buy Protectionc (continued)
Single Name (continued)
Transocean Inc.		(1.00)	%		Quarterly		MSCO		12/20/25		74,000		$	60,528	$	62,544	$	(2,016)
Transocean Inc.		(1.00)	%		Quarterly		MSCO		12/20/25		111,000			90,792		93,265		(2,473)
TUI AG		(5.00)	%		Quarterly		FBCO		12/20/21		100,000	EUR		19,077		5,172		13,905
Unisys Corp.		(5.00)	%		Quarterly		BZWS		12/20/24		19,000			(2,944)		(2,680)		(264)
Unisys Corp.		(5.00)	%		Quarterly		BZWS		6/20/25		48,000			(7,861)		(7,275)		(586)
Unisys Corp.		(5.00)	%		Quarterly		BZWS		6/20/25		48,000			(7,861)		(7,274)		(587)
Unisys Corp.		(5.00)	%		Quarterly		BZWS		6/20/25		48,000			(7,861)		(7,038)		(823)
Unisys Crop.		(5.00)	%		Quarterly		CITI		12/20/24		19,000			(2,944)		(2,764)		(180)
Unisys Crop.		(5.00)	%		Quarterly		CITI		12/20/24		19,000			(2,944)		(2,639)		(305)
US Steel Corp.		(5.00)	%		Quarterly		BZWS		6/20/25		22,000			5,614		6,473		(859)
US Steel Corp.		(5.00)	%		Quarterly		BZWS		6/20/25		22,000			5,614		6,484		(870)
US Steel Corp.		(5.00)	%		Quarterly		BZWS		6/20/25		22,000			5,614		7,277		(1,663)
US Steel Corp.		(5.00)	%		Quarterly		CITI		6/20/25		22,000			5,614		6,365		(751)
US Steel Corp.		(5.00)	%		Quarterly		GSCO		6/20/25		22,000			5,614		7,277		(1,663)
US Steel Corp.		(5.00)	%		Quarterly		GSCO		6/20/25		36,000			9,186		9,446		(260)
US Steel Corp.		(5.00)	%		Quarterly		JPHQ		6/20/25		22,000			5,614		6,671		(1,057)
US Steel Corp.		(5.00)	%		Quarterly		JPHQ		6/20/25		37,000			9,441		8,147		1,294
US Steel Corp.		(5.00)	%		Quarterly		JPHQ		6/20/25		59,000			15,055		15,474		(419)
US Steel Corp.		(5.00)	%		Quarterly		JPHQ		6/20/25		73,000			18,627		17,801		826
US Steel Corp.		(5.00)	%		Quarterly		MSCO		6/20/25		15,000			3,827		5,103		(1,276)
US Steel Corp.		(5.00)	%		Quarterly		MSCO		6/20/25		22,000			5,614		6,362		(748)
US Steel Corp.		(5.00)	%		Quarterly		MSCO		6/20/25		36,000			9,186		9,139		47
Contracts to Sell Protectionc,d
Single Name
Transocean Inc.		1.00	%		Quarterly		BZWS		12/20/24		74,000			(59,421)		(54,712)		(4,709)	CCC+
Transocean Inc.		1.00	%		Quarterly		BZWS		12/20/24		65,000			(52,194)		(49,087)		(3,107)	CCC+
Transocean Inc.		1.00	%		Quarterly		BZWS		12/20/24		33,000			(26,499)		(25,626)		(873)	CCC+
Transocean Inc.		1.00	%		Quarterly		MSCO		12/20/24		111,000			(89,131)		(87,080)		(2,051)	CCC+
Transocean Inc.		1.00	%		Quarterly		MSCO		12/20/24		74,000			(59,421)		(58,054)		(1,367)	CCC+
Transocean Inc.		1.00	%		Quarterly		MSCO		12/20/24		37,000			(29,710)		(27,321)		(2,389)	CCC+
Total OTC Swap Contracts													$	1,032,647	$	817,021	$	215,626
Total Credit Default Swap Contracts													$	727,319	$	751,163	$	(23,844)

^a In 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.

^b Based on Standard and Poor’s (S&P) Rating for single name swaps and internal ratings for index swaps.

^c Performance 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.

^d The Fund enters contracts to sell protection to create a long credit position.

77

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

At August 31, 2020, the Fund had the following interest rate swap contracts outstanding. See Note 3.

Interest Rate Swap Contracts

Description	Payment Frequency		Maturity Date		Notional Amount*			Value/Unrealized Appreciation (Depreciation)
Centrally Cleared Swap Contracts
Receive Floating rate 3 Month USD-LIBOR Pay Fixed rate 1.75%		Quarterly		9/18/21		1,500,000		$	(21,428)
Receive Floating rate 3 Month USD-LIBOR Pay Fixed rate 1.75%		Quarterly		3/18/22		1,100,000			(24,355)
Receive Fixed 4.73% Pay Floating Banxico Mexico 1 Month rate		Monthly		9/15/22		8,585,811	MXN		1,692
Receive Fixed 4.13%
Pay Floating BZDIOVRA Index		Annually		1/02/23		4,215,648	BRL		4,140
Receive Fixed 5.41%
Pay Floating Banxico Mexico 1 Month rate		Monthly		9/11/25		7,593,358	MXN		4,423
Receive Fixed 2.60%
Pay Floating CFETS China Fixing Repo 7 Day rate		Quarterly		9/16/25		3,331,608	CNY		(3,188)
Receive Floating rate 3 Month USD-LIBOR Pay Fixed rate 2.25%		Quarterly		6/20/28		1,100,000			(220,384)
Receive Fixed 6.15%
Pay Floating Banxico Mexico 1 Month rate		Monthly		9/05/30		8,325,446	MXN		8,369
Total Interest Rate Swap Contracts								$	(250,731)

^*In U.S. dollars unless otherwise indicated.

At August 31, 2020, the Fund had the following total return swap contracts outstanding. See Note 3.

Total Return Swap Contracts

Underlying Instrument	Financing Rate	Payment Frequency		Counter- party		Maturity Date		Notional Value		Value/Unrealized Appreciation (Depreciation)
OTC Swap Contracts
Equity Contracts - Longa
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/07/20	$	6,290	$	2,054
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/09/20		809		251
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/14/20		2,422		796
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/15/20		1,766		582
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/15/20		365		95
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/19/20		1,424		464
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/20/20		13,238		4,260
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/21/20		1,301		370
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/21/20		2,199		681
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/23/20		988		270
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/26/20		347		113
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/27/20		1,540		395
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		10/28/20		1,881		490
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		11/03/20		18,876		7,480
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		BZWS		2/17/21		3,210		560
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		BZWS		2/17/21		1,897		387
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		BZWS		2/22/21		227		40
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		3/04/21		7,036		1,443
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		3/05/21		15,291		3,153
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		3/10/21		8,467		1,699
Clearway Energy Inc.	1-Month LIBOR + 0.40%		Monthly		GSCO		3/11/21		27,315		5,613

78

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

STATEMENT OF INVESTMENTS (UNAUDITED)

Franklin K2 Long Short Credit Fund (continued)

Total Return Swap Contracts (continued)

Underlying Instrument

Financing Rate

Payment   Frequency

Counter- party

Maturity Date

Notional Value

Value/Unrealized Appreciation (Depreciation)

OTC Swap Contracts (continued)

Equity Contracts - Longa (continued)

Clearway Energy Inc.

1-Month LIBOR + 0.40%

Monthly

GSCO

3/11/21

$

13,131

$

2,450

Clearway Energy Inc.

1-Month LIBOR + 0.40%

Monthly

GSCO

3/12/21

14,066

2,540

Clearway Energy Inc.

1-Month LIBOR + 0.40%

Monthly

GSCO

3/12/21

33,991

6,577

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

3/15/21

1,246

244

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

3/15/21

8,540

3,049

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

3/15/21

50,469

18,328

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

4/01/21

34,272

14,182

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

4/16/21

27,062

5,086

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

4/28/21

2,779

811

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

4/29/21

3,714

709

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

4/29/21

3,722

1,017

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/03/21

5,648

1,533

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/04/21

2,440

858

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/05/21

1,364

469

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/06/21

3,072

910

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/07/21

682

222

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/10/21

1,134

332

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/11/21

2,026

539

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/18/21

3,492

1,004

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/19/21

2,615

634

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/20/21

7,220

1,771

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/21/21

7,165

1,826

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/24/21

903

221

Clearway Energy Inc.

��

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/27/21

1,212

278

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

5/31/21

3,678

746

Clearway Energy Inc.

1-Month LIBOR + 0.35%

Monthly

JPHQ

7/06/21

3,583

1,108

98,640

Interest Rate Contracts - Longa

Government of Egypt

1-Day FEDEF

Monthly

CITI

10/15/20

76,948

1,665

Government of Indonesia

3-Month LIBOR + 1.00%

Monthly

BOFA

5/18/21

384,829

26,086

Government of Indonesia

3-Month LIBOR + 0.60%

Monthly

DBAB

6/15/32

666,915

(14,115)

13,636

Total Total Return Swap Contracts

$

112,276

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

    Abbreviations

Counterparty			Currency		Selected Portfolio
BNPP		BNP Paribas	BRL	Brazilian Real	ARM	Adjustable Rate Mortgage
BOFA		Bank of America Corp.	CNY	Chinese Yuan	BZDIOVRA	Brazil Interbank Deposit Rate
BZWS		Barclays Bank PLC	EGP	Egyptian Pound	CFETS	China Foreign Exchange Trade System
CITI		Citigroup, Inc.	EUR	Euro	CLO	Collateralized Loan Obligation
DBAB		Deutsche Bank AG	GBP	British Pound	CMT	Constant Maturity Treasury Index
FBCO	��	Credit Suisse Group AG	JPY	Japanese Yen	EURIBOR	Euro Interbank Offered Rate
GSCO		The Goldman Sachs Group, Inc.	MXN	Mexican Peso	FEDEF	Federal Funds Effective Rate
JPHQ		JP Morgan Chase & Co.	RUB	Russian Ruble	FHLMC	Federal Home Loan Mortgage Corp.
MSCO		Morgan Stanley	USD	United States Dollar	FRN	Floating Rate Note
MSCS		Morgan Stanley Capital Services LLC			GO	General Obligation
					IO	Interest Only
Index					LIBOR	London InterBank Offered Rate
CDX.NA.HY		CDX North America High Yield Index			REIT	Real Estate Investment Trust
CDX.NA.IG		CDX North America Investment Grade Index			SFR	Single Family Revenue
					SOFR	Secured Overnight Financing Rate

79

FRANKLIN ALTERNATIVE STRATEGIES FUNDS

Notes to (Consolidated) Statements of Investments (unaudited)

1. Organization

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 two separate funds (Funds) and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP).

2. Financial Instrument Valuation

The Funds’ investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Funds calculate the net asset value (NAV) per share each business day as of 4 p.m. Eastern time or the regularly scheduled close of the New York Stock Exchange (NYSE), whichever is earlier. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Funds’ administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The Funds may utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Equity securities, exchange traded funds and derivative financial instruments listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded or as of 4 p.m. Eastern time. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.

Debt securities generally trade in the OTC market rather than on a securities exchange. The Funds’ pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value. 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. Investments in repurchase agreements are valued at cost, which approximates fair value.

Certain derivative financial instruments are centrally cleared or trade in the OTC market. The Funds’ pricing services use various techniques including industry standard option pricing models and proprietary discounted cash flow models to determine the fair value of those instruments. The Funds’ net benefit or obligation under the derivative contract, as measured by the fair value of the contract, is included in net assets.

The Funds have procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the Funds primarily employ a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, 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 Funds’ business day. Events can occur between the time at which trading in a foreign security is completed and 4 p.m. Eastern time that might call into question the reliability of the value of a portfolio security held by the Funds. As a result, differences may arise between the value of the Funds’ portfolio securities as determined at the foreign market close and the latest indications of value at 4 p.m. Eastern time. In order to minimize the potential for these differences, an independent pricing service may be used to adjust the value of the Funds’ portfolio securities to the latest indications of fair value at 4 p.m. Eastern time. At August 31, 2020, certain securities may have been fair valued using these procedures, in which case the securities were categorized as Level 2 inputs within the fair value hierarchy. See the Fair Value Measurements note for more information.

When the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the Funds’ NAV is not calculated, which could result in differences between the value of the Funds’ portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Funds for financial reporting purposes.

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3. Derivative Financial Instruments

Certain or all Funds invested in derivative financial instruments in order to manage risk or gain exposure to various other investments or markets. Derivatives are financial contracts based on an underlying or notional amount, require no initial investment or an initial net investment that is smaller than would normally be required to have a similar response to changes in market factors, and require or permit net settlement. Derivatives contain various risks including the potential inability of the counterparty to fulfill their obligations under the terms of the contract, the potential for an illiquid secondary market, and/or the potential for market movements.

Derivative counterparty credit risk is managed through a formal evaluation of the creditworthiness of all potential counterparties. Certain or all Funds attempt to reduce their 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 Funds include failure of the Funds 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. Early termination by the counterparty may result in an immediate payment by the Funds 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, 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 the 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 Funds’ 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.

Certain or all Funds entered into exchange traded futures contracts primarily to manage and/or gain exposure to commodity price, interest rate and equity price 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.

Certain or all Funds 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.

Certain or all Funds 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. 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 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.

Certain or all Funds entered into interest rate swap contracts primarily to manage 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. Over the term of the contract, contractually required payments to be paid and to be received are accrued daily and recorded as unrealized depreciation and appreciation until the payments are made, at which time they are realized.

Certain or all Funds entered into OTC total return swap contracts primarily to manage and/or gain exposure to interest rate, equity price and commodity 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 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.

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Certain or all Funds purchased or wrote exchange traded and/or OTC option contracts primarily to manage and/or gain exposure to interest rate, equity price 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.

The following Funds have invested in derivatives during the period.

Franklin K2 Alternative Strategies Fund – Futures, forwards, swaps and options

Franklin K2 Long Short Credit Fund – Futures, forwards, swaps and options

4. Novel Coronavirus Pandemic

The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Funds, their ability to buy and sell fund investments at appropriate valuations and their ability to achieve their investment objectives.

5. Restricted Securities

The Funds invest in securities that are restricted under the Securities Act of 1933 (1933 Act). Restricted securities are often purchased in private placement transactions, and cannot be sold without prior registration unless the sale is pursuant to an exemption under the 1933 Act. Disposal of these securities may require greater effort and expense, and prompt sale at an acceptable price may be difficult. The Funds may have registration rights for restricted securities. The issuer generally incurs all registration costs.

At August 31, 2020, investments in restricted securities, excluding securities exempt from registration under the 1933 Act, were as follows:

Shares		Issuer	Acquisition Date		Cost		Value
	Franklin K2 Alternative Strategies Fund
	4,965	aOne Call Corp.		10/28/19	$	595,597	$	528,768
	33,337	aOne Call Corp., cvt. pfd.		10/28/19		3,999,099		3,550,384
		Total Restricted Securities (Value is 0.3% of Net Assets)			$	4,594,696	$	4,079,152
	Franklin K2 Long Short Credit Fund
	923	Acosta Inc.		12/31/19	$	8,144	$	8,144
	745	Acosta Inc., cvt. pfd.		12/31/19		50,262		50,262
	947	bOne Call Corp.		10/28/19		113,545		100,805
	3,821	bOne Call Corp., cvt. pfd.		10/28/19		458,341		406,912
		Total Restricted Securities (Value is 0.6% of Net Assets)			$	630,292	$	566,123

^a  The Fund also invests in unrestricted securities of this issuer, valued at $3,990,269 as of August 31, 2020.

^b  The Fund also invests in unrestricted securities of this issuer, valued at $457,329 as of August 31, 2020.

6. Unfunded Loan Commitments

Certain or all Funds entered into certain credit agreements, all or a portion of which may be unfunded. The Funds are obligated to fund these loan commitments at the borrowers’ discretion. Unfunded loan commitments and funded portions of credit agreements are marked to market daily. Funded portions of credit agreements are presented in the (Consolidated) Statements of Investments.

At August 31, 2020, unfunded commitments were as follows:

Borrower	Unfunded Commitment
Franklin K2 Long Short Credit Fund
Areas, Term Loan B1	$	22,883
Coty, Inc., Term Loan B		18,000
Intelsat Jackson Holdings SA, Term Loan DIP		333,953
	$	374,836

7. Investments in Affiliated Management Investment Companies

Certain or all Funds invest in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies. During the period ended August 31, 2020, investments in affiliated management investment companies were as follows:

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	Value at Beginning of Period		Purchases		Sales		Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)		Value at End of Period		Number of Shares Held at End of Period		Income from   Securities Loaned
Franklin K2 Alternative Strategies Fund
Non-Controlled Affiliates
Institutional Fiduciary Trust Money Market Portfolio, 0.00%	$	1,731,000	$	18,342,000		$ (18,081,000)		$ -		$ -	$	1,992,000		1,992,000		$ -

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

Certain or all Funds invest in certain financial instruments and commodity-linked derivative investments through its investments 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 August 31, 2020, the K2 Subsidiary’s investments, as well as any other assets and liabilities of the K2 Subsidiary, are reflected in the Fund’s Consolidated Statements of Investments. At August 31, 2020, the Fund’s investments in the K2 Subsidiary were as follows:

Fund Name	Subsidiary Namea		Consolidated Net Assets		Subsidiary Net Assets		% of Consolidated Net Assets
Franklin K2 Alternative Strategies Fund		K2 Holdings Investment Corp.	$	1,175,665,756	$	21,551,004		1.8	%

^a  The Fund’s investments in the K2 Subsidiary is limited to 25% of consolidated assets.

9. Fair Value Measurements

The Funds follow a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Funds’ own market assumptions (unobservable inputs). These inputs are used in determining the value of the Funds’ financial instruments and are summarized in the following fair value hierarchy:

• Level 1 – quoted prices in active markets for identical financial instruments

• Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)

• Level 3 – significant unobservable inputs (including the Funds’ own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

A summary of inputs used as of August 31, 2020, in valuing the Funds’ assets and liabilities carried at fair value, is as follows:

		Level 1			Level 2			Level 3				Total
Franklin K2 Alternative Strategies Fund
Assets:
Investments in Securities:a
Equity Investmentsb	$		404,022,065	$		61,198,110	$		4,124,401	c	$		469,344,576
Convertible Bonds			–			183,909,326			–				183,909,326
Convertible Bonds in Reorganization			–			4,394			–				4,394
Corporate Bonds and Notes			–			100,373,499			33,091				100,406,590
Corporate Bonds and Notes in Reorganization			–			5,704,474			46,670				5,751,144
Senior Floating Rate Interests			–			134,652			–				134,652
Senior Floating Rate Interests in Reorganization			–			338,288			2,500				340,788
Foreign Government and Agency Securities			–			24,283,049			157,572				24,440,621
Asset-Backed Securities and Commercial Mortgage-Backed Securities			–			84,462,160			1,314,853				85,777,013
Municipal Bonds in Reorganization			–			6,100,014			–				6,100,014
Options Purchased			1,307,285			133,213			–				1,440,498
Short Term Investments			265,770,531			23,280,691			861,038				289,912,260
Total Investments in Securities	$		671,099,881	$		489,921,870	$		6,540,125		$		1,167,561,876
Other Financial Instruments:
Futures Contracts	$		2,914,183	$		–	$		–		$		2,914,183
Forward Exchange Contracts			–			5,415,664			–				5,415,664
Swap Contracts			–			8,509,774			–				8,509,774
Total Other Financial Instruments	$		2,914,183	$		13,925,438	$		–		$		16,839,621
Liabilities:
Other Financial Instruments:
Options Written	$		1,500,399	$		174,340	$		–		$		1,674,739
Securities Sold Shorta			242,488,506			14,064,334			–				256,552,840
Futures Contracts			5,506,573			–			–				5,506,573
Forward Exchange Contracts			–			5,059,213			–				5,059,213
Swap Contracts			–			3,911,676			–				3,911,676
Total Other Financial Instruments	$		249,495,478	$		23,209,563	$		–		$		272,705,041

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		Level 1			Level 2			Level 3				Total
Franklin K2 Long Short Credit Fund
Assets:
Investments in Securities:a
Equity Investmentsb	$		2,185,911	$		217,666	$		566,123	c	$		2,969,700
Convertible Bonds			–			2,951,175			–				2,951,175
Corporate Bonds and Notes			–			13,427,514			–				13,427,514
Corporate Bonds and Notes in Reorganization			–			1,491,777			–				1,491,777
Senior Floating Rate Interests			–			3,353,202			–				3,353,202
Foreign Government and Agency Securities			–			5,202,970			–				5,202,970
U.S. Government and Agency Securities			–			918,366			–				918,366
Asset-Backed Securities and Commercial Mortgage-Backed Securities			–			49,127,791			302,413				49,430,204
Municipal Bonds in Reorganization			–			1,056,556			–				1,056,556
Options Purchased			66,291			5,000			–				71,291
Short Term Investments			3,331,800			3,305,836			156,423				6,794,059
Total Investments in Securities	$		5,584,002	$		81,057,853	$		1,024,959		$		87,666,814
Other Financial Instruments:
Forward Exchange Contracts	$		–	$		40,376	$		–		$		40,376
Swap Contracts			–			759,697			–				759,697
Unfunded Loan Commitments			–			13,058			–				13,058
Total Other Financial Instruments	$		–	$		813,131	$		–		$		813,131
Liabilities:
Other Financial Instruments:
Options Written	$		11,248	$		–	$		–		$		11,248
Securities Sold Shorta			2,941,030			7,188,016			–				10,129,046
Futures Contracts			71,287			–			–				71,287
Forward Exchange Contracts			–			207,028			–				207,028
Swap Contracts			–			921,996			–				921,996
Total Other Financial Instruments	$		3,023,565	$		8,317,040	$		–		$		11,340,605

^a For detailed categories, see the accompanying (Consolidated) Statements of Investments.

^b Includes common, preferred and convertible preferred stocks as well as other equity interests.

^c Includes securities determined to have no value at August 31, 2020.

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 period. At August 31, 2020, the reconciliation is as follows:

	Balance at Beginning of Period			Purchases		Sales			Transfer Into Level 3a		Transfer Out of Level 3b			Cost Basis Adjustments		Net Realized Gain (Loss)		Net Unrealized Appreciation (Depreciation)			Balance at End of Period			Net Change in Unrealized Appreciation (Depreciation) on Assets Held at Period End
Franklin K2 Long Short Credit Fund
Assets:
Investments in Securities:
Equity Investmentsc	$	592,344	d	$	-	$	-		$	-	$	-		$	-	$	-	$	(26,221	)	$	566,123	d	$	(26,221	)
Asset-Backed Securities and Commercial Mortgage-Backed Securities		462,124			-		(10,995	)		302,413		(487,123	)		-		5,326		30,668			302,413			36,474
Short Term Investments		-			153,351		-			-		-			-		-		3,072			156,423			3,072
Total Investments in Securities		$1,054,468			$153,351		$(10,995)			$302,413		$(487,123)			$-		$5,326		$ 7,519			$1,024,959			$ 13,325

^a The investments were transferred into Level 3 as a result of the unavailability of other significant observable valuation inputs.

^b The investment was transferred out of Level 3 as a result of the availability of other significant observable valuation inputs.

^c Includes common and convertible preferred stocks.

^d Includes securities determined to have no value at August 31, 2020.

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Significant unobservable valuation inputs for material Level 3 assets and/or liabilities and impact to fair value as a result of changes in unobservable valuation inputs as of August 31, 2020, are as follows:

Description	Fair Value at End of Period			Valuation Technique		Unobservable Inputs	Amount/ Range		Impact to Fair Value if Input Increasesa
Franklin K2 Long Short Credit Fund Assets:
Investments in Securities:
Equity Investmentsb	$	517,717			Discounted cash flow	Discount rate		10.5% - 11.5%		Decrease	c
						Exit multiple		9.5x -11x		Increase	c
					Market comparables	EV / Revenue multiple		1.5x - 1.8x		Increase	c
						EV / EBITDA multiple		11.5x - 13.5x		Increase	c
					Market transaction	EV / EBITDA multiple		11.5x –13.5x		Increase	c
All Other Investmentsd		507,242	e
Total	$	1,024,959

^a Represents the directional change in the fair value that would result from a significant and reasonable increase in the corresponding input. A significant and reasonable decrease in the input would have the opposite effect. Significant impacts, if any, to fair value and/or net assets have been indicated.

^b Includes common and convertible preferred stocks.

^c Represents a significant impact to fair value and net assets.

^d Includes fair value of immaterial assets and/or liabilities developed using various valuation techniques and unobservable inputs. May also include values derived using private transaction prices or non-public third party pricing information which is unobservable.

^e Includes securities determined to have no value at August 31, 2020.

Abbreviations List

EBITDA Earnings before interest, taxes, depreciation and amortization

EV Enterprise value

10. Subsequent Events

The Funds have evaluated subsequent events through the issuance of the (Consolidated) Statements of Investments and determined that no events have occurred that require disclosure.

For additional information on the Funds’ significant accounting policies, please refer to the Funds’ most recent semiannual or annual shareholder report.

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