UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-CSRS
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number_811-01700
__Franklin Gold and Precious Metals Fund
(Exact name of registrant as specified in charter)
(Exact name of registrant as specified in charter)
One Franklin Parkway, San Mateo, CA 94403-1906
(Address of principal executive offices) (Zip code)
Craig S. Tyle, One Franklin Parkway, San Mateo, CA 94403-1906
(Name and address of agent for service)
Registrant's telephone number, including area code:_650 312-2000
Date of fiscal year end: 7/31
Date of reporting period:_1/31/21
Item 1. Reports to Stockholders.
a.) The following is a copy of the report transmitted to shareholders pursuant to Rule30e-1 under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30e-1.)
b.) A copy of the notice transmitted to shareholders in reliance on Rule 30e-3 under the 1940 Act that contains disclosures specified by paragraph (c)(3) of that rule is included in the Annual Report. Not Applicable.
SEMIANNUAL
REPORT
AND
SHAREHOLDER
LETTER
Franklin
Gold
and
Precious
Metals
Fund
January
31,
2021
Sign
up
for
electronic
delivery
at
franklintempleton.com/edelivery
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FDIC
Insured
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Bank
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franklintempleton.com
Not
part
of
the
semiannual
report
1
Shareholder
Letter
Dear
Shareholder:
During
the
six
months
ended
January
31,
2021,
the
global
economy
was
further
hindered
by
the
ongoing
novel
coronavirus
(COVID-19)
pandemic.
Although
the
economy
showed
subdued
signs
of
recovery
during
the
period,
the
recovery
was
dampened
by
a
substantial
increase
in
COVID-19
cases
toward
period-end.
Globally,
equities
advanced
over
the
period
and
many
central
banks,
including
the
U.S.
Federal
Reserve
and
the
European
Central
Bank,
continued
to
maintain
low
benchmark
interest
rates
as
well
as
monetary
stimulus
programs
to
bolster
economic
growth.
Global
stocks
advanced
before
declining
slightly
by
period-
end
amid
investor
optimism
about
the
development
of
COVID-19
treatments
and
vaccines,
beginning
of
vaccination
programs
in
some
countries,
rising
expectations
of
increased
fiscal
stimulus
and
indications
of
improving
economic
conditions,
particularly
in
China.
In
this
environment,
U.S.
stocks,
as
measured
by
the
Standard
&
Poor’s
®
500
Index,
and
global
developed
market
stocks,
as
measured
by
the
MSCI
World
Index,
ended
the
period
with
strong
positive
returns.
After
starting
the
period
at
$1,976
per
ounce,
gold
rose
to
a
record
high
of
$2,067
per
ounce
in
August
2020
amid
a
weak
U.S.
dollar,
low
interest
rates,
federal
deficit
and
inflation
fears,
and
data
suggesting
a
slower
recovery
from
the
pandemic-induced
economic
crisis.
1
Gold
edged
down
during
the
following
months
given
optimism
about
vaccine
development
and
approvals,
a
gradual
reopening
of
the
global
economy
and
the
outcome
of
the
U.S.
elections.
Gold
advanced
in
early
January
2021
to
over
$1,900
per
ounce,
but
retreated
after
U.S.
Treasury
yields
rose,
ending
the
period
at
$1,848
per
ounce.
1
Although
investor
interest
in
gold
waned
in
the
back
half
of
the
period
under
review
as
optimism
of
a
post
pandemic
recovery
increased
and
physical
gold
ETF
holdings
declined
modestly,
gold
remained
topical
given
the
ongoing
pandemic
uncertainty,
low
real
interest
rates,
inflation
pressures
and
mounting
concerns
over
major
economies’
debt
ratios
associated
with
fiscal
and
monetary
stimulus
measures
during
the
COVID-19
pandemic
recovery.
In
this
environment,
gold
stocks,
as
measured
by
the
FTSE
®
Gold
Mines
Index,
posted
a
total
return
of
-19.45%
for
the
six-month
period.
2
We
are
committed
to
our
long-term
perspective
and
disciplined
investment
approach
as
we
conduct
a
rigorous,
fundamental
analysis
of
securities
with
a
regular
emphasis
on
investment
risk
management.
We
believe
active,
professional
investment
management
serves
investors
well.
We
also
recognize
the
important
role
of
financial
professionals
in
today’s
markets
and
encourage
investors
to
continue
to
seek
their
advice.
Amid
changing
markets
and
economic
conditions,
we
are
confident
investors
with
a
well-diversified
portfolio
and
a
patient,
long-term
outlook
should
be
well-positioned
for
the
years
ahead.
Franklin
Gold
and
Precious
Metals
Fund’s
semiannual
report
includes
more
detail
about
prevailing
conditions
and
discussions
about
investment
decisions
during
the
period.
Please
remember
all
securities
markets
fluctuate,
as
do
mutual
fund
share
prices.
We
thank
you
for
investing
with
Franklin
Templeton,
welcome
your
questions
and
comments,
and
look
forward
to
serving
your
future
investment
needs.
Sincerely,
Edward
Perks,
CFA
President
and
Chief
Executive
Officer
-
Investment
Management
Franklin
Gold
and
Precious
Metals
Fund
This
letter
reflects
our
analysis
and
opinions
as
of
January
31,
2021,
unless
otherwise
indicated.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
fund.
Statements
of
fact
are
from
sources
considered
reliable.
CFA
®
is
a
trademark
owned
by
CFA
Institute.
1.
Source:
Bloomberg
LP.
Based
on
spot
prices
quoted
in
U.S.
dollars
per
troy
ounce.
2.
Source:
Morningstar.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
franklintempleton.com
Semiannual
Report
2
Contents
Semiannual
Report
Franklin
Gold
and
Precious
Metals
Fund
3
Performance
Summary
7
Your
Fund’s
Expenses
9
Financial
Highlights
and
Statement
of
Investments
10
Financial
Statements
18
Notes
to
Financial
Statements
22
Tax
Information
35
Shareholder
Information
36
Visit
franklintempleton.com
for
fund
updates,
to
access
your
account,
or
to
find
helpful
financial
planning
tools.
3
franklintempleton.com
Semiannual
Report
SEMIANNUAL
REPORT
Franklin
Gold
and
Precious
Metals
Fund
This
semiannual
report
for
Franklin
Gold
and
Precious
Metals
Fund
covers
the
period
ended
January
31,
2021
.
Your
Fund’s
Goal
and
Main
Investments
The
Fund
seeks
capital
appreciation.
Its
secondary
goal
is
to
provide
shareholders
with
current
income
through
dividends
or
interest
received
from
its
investments.
Under
normal
market
conditions,
the
Fund
invests
at
least
80%
of
its
net
assets
in
securities
of
gold
and
precious
metals
operation
companies.
The
Fund
primarily
invests
in
equity
securities,
mainly
common
stock,
and
also
invests
in
American,
global
and
European
depositary
receipts.
Performance
Overview
The
Fund’s
Class
A
shares
posted
a
-7.38%
cumulative
total
return
for
the
six
months
under
review.
In
comparison,
the
Fund’s
primary
benchmark,
the
sector-specific
FTSE
Gold
Mines
Index,
which
comprises
companies
whose
principal
activity
is
gold
mining,
posted
a
-19.45%
total
return.
1
The
Fund’s
secondary
benchmark,
the
Standard
&
Poor’s
500
Index
(S&P
500
®
),
which
is
a
broad
measure
of
U.S.
stock
performance,
posted
a
+14.47%
total
return.
1
You
can
find
the
Fund’s
long-term
performance
data
in
the
Performance
Summary
beginning
on
page
7
.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236
.
Economic
and
Market
Overview
Global
developed
and
emerging
market
equities,
as
measured
by
the
MSCI
All
Country
World
Index,
advanced
strongly
during
the
six
months
ended
January
31,
2021.
Equities
in
all
major
regions
of
the
world
posted
sizable
gains
for
the
period
despite
the
global
surge
of
the
novel
coronavirus
(COVID-19).
Following
stock
market
declines
in
September
and
October
2020
due
to
geopolitical
tensions
and
rising
infection
rates,
equities
began
to
rebound
in
November,
as
successful
trials
of
COVID-19
vaccines,
the
start
of
vaccination
programs
in
some
countries
and
expectations
for
fiscal
stimulus
from
the
new
U.S.
administration
led
many
equity
markets
to
reach
new
highs.
Some
indications
of
economic
revival,
most
notably
in
China,
also
helped
drive
stocks
higher
before
paring
gains
in
late
January
2021.
In
the
U.S.,
equities
posted
robust
gains
for
the
period
amid
the
government’s
fiscal
and
monetary
stimulus
measures,
reports
of
certain
COVID-19
vaccines’
high
efficacy
rates
and
the
beginning
of
vaccinations.
After
a
record
annualized
decline
in
second-quarter
2020
gross
domestic
product
(GDP),
rising
consumer
spending
helped
drive
third-quarter
GDP
to
expand
at
a
record
annualized
rate.
Following
a
summer
rally,
concerns
about
rising
COVID-19
infection
rates
along
with
uncertainties
about
the
U.S.
presidential
election
and
additional
fiscal
stimulus
pressured
stocks
in
September
and
October.
Consumer
spending
slowed
during
the
fourth
quarter
as
surging
COVID-19
infections
led
to
new
restrictions
in
some
states.
Meanwhile,
growth
in
residential
and
corporate
investment
along
with
solid
corporate
earnings
results
bolstered
investor
sentiment.
Despite
the
relatively
high
unemployment
rate
(6.3%
at
period-end),
equities
began
to
rally
in
November,
buoyed
by
the
outcome
of
the
U.S.
presidential
election,
the
start
of
COVID-19
vaccination
programs
and
the
passage
of
a
new
U.S.
stimulus
bill.
2
Stocks
maintained
gains
following
the
U.S.
presidential
Geographic
Composition
1/31/21
%
of
Total
Net
Assets
Canada
49.3%
Australia
20.0%
South
Africa
9.2%
United
States
5.7%
Tanzania
3.2%
Kyrgyzstan
2.7%
Ivory
Coast
2.2%
Turkey
1.6%
Egypt
1.6%
Other
1.1%
Short-Term
Investments
&
Other
Net
Assets
3.4%
1.
Source:
Morningstar.
2.
Source:
U.S.
Bureau
of
Labor
Statistics.
The
indexes
are
unmanaged
and
include
reinvestment
of
any
income
or
distributions.
They
do
not
reflect
any
fees,
expenses
or
sales
charges.
One
cannot
invest
directly
in
an
index,
and
an
index
is
not
representative
of
the
Fund’s
portfolio.
The
dollar
value,
number
of
shares
or
principal
amount,
and
names
of
all
portfolio
holdings
are
listed
in
the
Fund’s
Statement
of
Investments
(SOI).
The
SOI
begins
on
page
14
.
Franklin
Gold
and
Precious
Metals
Fund
4
franklintempleton.com
Semiannual
Report
inauguration
amid
hopes
of
passing
additional
stimulus
spending
but
subsequently
retreated
in
the
last
week
of
January
2021,
restricting
gains
for
the
period.
The
U.S.
Federal
Reserve
(Fed)
maintained
the
federal
funds
target
rate
at
a
range
of
0.00%–0.25%
and
continued
its
program
of
open-ended
bond
purchases
to
help
keep
markets
functioning.
Furthermore,
the
Fed
signaled
that
interest
rates
would
potentially
remain
low,
even
if
inflation
moderately
exceeded
the
Fed’s
2%
target
for
some
time.
In
the
eurozone,
the
economy
contracted
again
in
the
fourth
quarter
of
2020,
following
quarter-on-quarter
expansion
in
the
third
quarter
and
contractions
in
the
first
and
second
quarters.
Fourth-quarter
GDP
growth
rates
varied
widely
among
the
region’s
largest
economies
amid
renewed
lockdowns
and
delays
in
COVID-19
vaccine
distribution.
Germany’s
and
Spain’s
fourth-quarter
GDP
expanded
modestly,
while
France’s
contracted.
Despite
rising
infection
rates,
which
heightened
concerns
that
the
nascent
economic
revival
could
falter,
successful
vaccine
development
and
a
Brexit
resolution
contributed
to
a
positive
performance
for
European
developed
market
equities,
as
measured
by
the
MSCI
Europe
Index.
Asian
developed
and
emerging
market
equities,
as
measured
by
the
MSCI
All
Country
Asia
Index,
rose
significantly
as
economic
recovery
in
China,
a
key
driver
of
regional
economies,
maintained
momentum.
China
was
the
only
major
global
economy
to
expand
for
full
calendar-year
2020.
Asian
equity
markets
were
also
aided
by
optimism
that
economic
revitalization
would
be
further
spurred
by
COVID-19
vaccines.
Global
emerging
market
stocks,
as
measured
by
the
MSCI
Emerging
Markets
Index,
also
posted
sizable
gains
for
the
period.
Improving
economic
activity,
stabilizing
oil
prices
and
U.S.
dollar
weakness
supported
emerging
market
equities.
In
spite
of
higher
COVID-19
cases
in
some
countries,
emerging
market
stocks
rallied
amid
easing
political
uncertainty,
commencement
of
COVID-19
vaccinations
and
rising
commodity
prices.
Precious
Metals
Prices
(7/31/20–1/31/21
)*
*Source:
Bloomberg
LP.
Amounts
shown
are
based
on
spot
prices
quoted
in
US
dollars
per
troy
ounce.
For
illustrative
purposes
only;
not
representative
of
the
Fund’s
portfolio
composition
or
performance.
Precious
Metals
Sector
Overview
During
the
six
months
ended
January
31,
2021,
after
starting
the
period
at
$1,976
per
ounce,
gold
rose
to
a
record
high
of
$2,067
per
ounce
in
August
2020
amid
a
weak
U.S.
dollar,
low
interest
rates,
federal
deficit
and
inflation
fears,
and
data
suggesting
a
slower
recovery
from
the
COVID-19
induced
economic
crisis.
3
However,
gold
edged
down
during
the
following
months
given
optimism
about
progress
in
vaccine
development
and
approvals,
a
gradual
reopening
of
the
global
economy
and
the
outcome
of
the
U.S.
elections.
Although
the
price
of
gold
rose
in
early
January
2021
to
over
$1,900
per
ounce,
it
suffered
a
setback
after
U.S.
Treasury
yields
rose,
ending
the
period
at
$1,848
per
ounce.
3
Although
investor
interest
in
gold
waned
in
the
back
half
of
the
period
under
review
as
optimism
of
a
post
pandemic
recovery
increased
and
physical
gold
ETF
holdings
declined
modestly,
gold
remained
topical
given
the
ongoing
pandemic
uncertainty,
low
real
interest
rates,
inflation
pressures
and
mounting
concerns
over
major
economies’
debt
ratios
associated
with
fiscal
and
monetary
stimulus
measures
during
the
COVID-19
pandemic
recovery.
Among
other
precious
metals,
platinum
and
silver
both
advanced
with
low
double-digit
percentage
gains
over
the
six-month
period.
3
Platinum
was
the
best-performing
precious
metal
over
the
period,
benefiting
from
supply
3.
Source:
Bloomberg
LP.
Based
on
spot
prices
quoted
in
U.S.
dollars
per
troy
ounce.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
Franklin
Gold
and
Precious
Metals
Fund
5
franklintempleton.com
Semiannual
Report
disruptions
and
robust
demand
for
the
metal,
which
is
used
in
vehicle
pollution
control
devices.
3
Silver
also
rallied
based
on
growing
industrial
demand,
including
for
5G
network
equipment
and
wider
use
in
solar
panels
and
electric
vehicles.
Other
factors
were
also
in
play
in
late
January
2021,
when
silver
market
volatility
spiked
along
with
prices
after
being
targeted
by
day
traders
that
aggressively
bought
silver
ETF
shares,
seeking
to
create
a
squeeze
against
select
banks
and
hedge
funds.
Palladium
pushed
higher
for
most
of
the
period,
benefiting
from
limited
supply
and
growing
demand
for
its
use
in
vehicle
pollution
control
devices,
but
pulled
back
in
January
to
post
a
single-digit
percentage
gain
for
the
period.
3
Investment
Strategy
Gold
and
precious
metals
operation
companies
include
companies
that
mine,
process,
or
deal
in
gold
or
other
precious
metals,
such
as
silver,
platinum
and
palladium,
including
mining
finance
and
exploration
companies
as
well
as
operating
companies
with
long-
or
medium-life
mines.
The
Fund
may
buy
securities
of
gold
and
precious
metals
operation
companies
located
anywhere
in
the
world
and
invests
predominantly
in
non-U.S.
companies.
The
Fund
may
invest
in
companies
without
regard
to
market
capitalization,
and
may
heavily
invest
in
small-
and
mid-capitalization
companies.
We
look
for
companies
with
low
cost
reserves
and
experienced
management
teams
with
established
track
records,
particularly
focusing
on
companies
with
long
life
production
profiles,
expandable
resource
bases,
and
active
exploration
programs
that
can
potentially
drive
future
reserve
and
production
growth.
The
investment
manager’s
process
generally
includes
an
assessment
of
the
potential
impacts
of
any
material
environmental,
social
and
governance
(ESG)
factors
on
the
long-term
risk
and
return
profile
of
a
company.
Manager’s
Discussion
Key
contributors
to
the
Fund’s
absolute
performance
during
the
six-month
period
under
review
included
the
Fund’s
holdings
in
Chalice
Mining,
Impala
Platinum
Holdings
and
Platinum
Group
Metals.
Although
the
fund’s
gold
miners,
representing
roughly
80%
of
total
net
assets,
traded
lower
over
the
six-month
period,
we
also
held
numerous
off-index
companies
that
posted
double-digit
percentage
gains,
which
helped
to
open
a
wide
performance
gap
between
the
Fund
and
its
benchmark.
Company-specific
progress
underpinned
the
rallies
in
most
of
these
names,
including
outsized
gains
for
our
position
in
Australia-based
Chalice
Mining.
Chalice
reported
successful
drilling
results
as
it
discovered
and
defined
significant
high-
grade
extensions
composed
of
platinum
group
elements,
nickel,
copper
and
gold
at
its
Julimar
project,
about
an
hour’s
drive
from
the
city
of
Perth.
Given
the
width
and
grade
of
the
drill
results
and
continued
exploration
success
in
the
area,
the
multi-faceted
mineralized
Julimar
complex
could
potentially
emerge
as
a
globally
significant
deposit
of
critical
metals
in
Western
Australia.
Drilling
activity
at
Pyramid
Hill,
a
gold-focused
project
in
Southeastern
Australia
also
yielded
some
promising
results
across
several
gold
zones
as
Chalice
continued
to
define
the
extent
of
the
overall
resource.
Unlike
the
gold
industry,
our
positions
in
metals
producers
that
focus
on
platinum,
palladium
and
other
non-gold
metals
showed
overall
positive
performance
during
the
period.
Platinum
and
palladium
miners,
including
our
positions
in
South
African-focused
companies
such
as
Impala
Platinum
Holdings
(among
the
Fund’s
largest
positions)
and
Platinum
Group
Metals,
benefited
from
tightening
supply
and
demand
fundamentals.
Investment
demand
for
platinum,
the
key
raw
material
used
in
many
vehicle
pollution-control
devices,
has
been
robust,
while
the
World
Platinum
Investment
Council
in
mid-November
projected
a
record
production
deficit
for
2020
based
on
disruptions
at
key
mine
sites.
Both
companies
also
benefited
as
palladium—another
sought-after
catalyst
component
in
pollution-control
devices—has
maintained
its
status
as
the
most
valuable
of
the
four
major
precious
metals
during
the
period,
with
strong
demand
and
limited
new
supply
keeping
prices
relatively
near
all-time
highs.
Tighter
vehicle
emissions
regulations,
especially
in
China
and
India,
are
driving
greater
palladium
and
platinum
usage
as
companies
look
to
exceed
increasingly
stringent
standards.
For
the
six
months
ended
January
31,
2021,
the
U.S.
dollar
declined
in
value
relative
to
most
foreign
currencies.
As
a
result,
the
Fund's
performance
benefited
from
currency
appreciation
from
the
portfolio's
investment
predominantly
in
securities
with
non-U.S.
currency
exposure.
However,
one
cannot
expect
the
same
result
in
future
periods.
Whether
the
U.S.
dollar
goes
up
or
weakens
compared
with
foreign
Portfolio
Composition
1/31/21
%
of
Total
Net
Assets
Gold
73.6%
Precious
Metals
&
Minerals
11.7%
Diversified
Metals
&
Mining
9.3%
Silver
1.3%
Other
0.7%
Short-Term
Investments
&
Other
Net
Assets
3.4%
Franklin
Gold
and
Precious
Metals
Fund
6
franklintempleton.com
Semiannual
Report
currencies,
company-specific
factors
may
offset
the
effects
of
the
currency
movements
on
the
value
of
individual
investments
and,
possibly,
the
Fund's
performance
overall.
Detractors
from
the
Fund’s
absolute
performance
during
the
period
under
review
included
the
Fund’s
holdings
in
gold
producers
Barrick
Gold,
Newcrest
Mining
and
B2Gold.
The
share
price
of
Canada-based
Barrick
Gold,
our
largest
company
holding,
decreased
during
the
period,
largely
due
to
price
declines
in
gold
after
a
record
high
in
August
2020.
Despite
this
trend,
the
company
capitalized
on
historically
high
gold
prices,
reporting
solid
third-quarter
financial
results,
including
large
increases
in
cash
flow
and
earnings,
sizable
debt
reduction
and
a
dividend
increase
over
the
second
quarter.
Barrick
was
also
able
to
achieve
its
gold
and
copper
production
targets,
including
increased
fourth-
quarter
production.
The
company
also
announced
that
Twiga
Minerals,
its
joint
venture
with
Tanzania’s
government,
had
the
potential
to
become
a
key
long-term
asset,
and
Barrick,
together
with
the
government
of
Papua
New
Guinea,
announced
the
intention
to
form
a
new
partnership
to
operate
the
Porgera
mine
that
is
currently
under
care
and
maintenance.
Newcrest
Mining,
another
large
Fund
holding,
is
an
Australia-
based
gold
mining
exploration
and
production
company
that
operates
in
Australia
and
the
Asia-Pacific
region.
Newcrest’s
stock
price
also
declined
due
to
fluctuation
in
gold
prices,
but
Newcrest
benefited
from
increased
profits,
earnings
and
cash
flow
during
the
first
half
of
its
2021
fiscal
year.
The
company
announced
improvements
to
its
Lihir
gold
mine
in
Papua
New
Guinea,
which
have
the
potential
to
unlock
additional
high-grade
mineralization.
Newcrest
is
also
in
the
second
stage
of
expanding
its
top-performing
Cadia
mine
in
New
South
Wales,
Australia,
and
is
progressing
with
its
Havieron
project
in
Western
Australia,
through
a
joint
venture
with
Greatland
Gold,
and
released
a
mineral
resources
estimate
in
December.
The
company
also
received
an
environmental
permit
from
the
government
of
Papua
New
Guinea
for
the
Wafi-Golpu
project,
an
important
step
toward
obtaining
a
special
mining
lease
on
this
large
long-life
copper
and
gold
project.
B2Gold,
also
one
of
our
largest
portfolio
positions,
is
a
low-
cost
senior
gold
producer
with
mines
in
Mali,
the
Philippines
and
Namibia,
and
development
projects
in
Colombia
and
Burkina
Faso.
Despite
the
company’s
share
price
decline
due
to
gold
prices
trending
lower
for
much
of
the
period,
B2Gold
reported
record
third-quarter
revenue
of
US$487
million,
cash
flow
of
US$301
million
and
increased
earnings
of
US$0.25
per
share,
with
good
cost
containment
from
its
three
fully
owned
mines.
The
company’s
third-quarter
production
of
over
248,000
ounces
also
slightly
exceeded
its
gold
production
goal,
representing
a
significant
increase
over
the
prior
year’s
third-quarter
production,
mostly
due
to
expanded
production
from
its
Fekola
mine
in
Mali.
Thank
you
for
your
continued
participation
in
Franklin
Gold
and
Precious
Metals
Fund.
We
look
forward
to
serving
your
future
investment
needs.
Stephen
M.
Land,
CFA
Frederick
G.
Fromm,
CFA
Portfolio
Management
Team
The
foregoing
information
reflects
our
analysis,
opinions
and
portfolio
holdings
as
of
January
31,
2021
,
the
end
of
the
reporting
period.
The
way
we
implement
our
main
investment
strategies
and
the
resulting
portfolio
holdings
may
change
depending
on
factors
such
as
market
and
economic
conditions.
These
opinions
may
not
be
relied
upon
as
investment
advice
or
an
offer
for
a
particular
security.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
the
Fund.
Statements
of
fact
are
from
sources
considered
reliable,
but
the
investment
manager
makes
no
representation
or
warranty
as
to
their
completeness
or
accuracy.
Although
historical
performance
is
no
guarantee
of
future
results,
these
insights
may
help
you
understand
our
investment
management
philosophy.
Top
10
Holdings
1/31/21
Company
Sub-Industry
%
of
Total
Net
Assets
a
a
Barrick
Gold
Corp.
5.5%
Gold
Newmont
Corp.
4.1%
Gold
Newcrest
Mining
Ltd.
3.6%
Gold
Impala
Platinum
Holdings
Ltd.
3.4%
Precious
Metals
&
Minerals
Alamos
Gold,
Inc.
3.3%
Gold
B2Gold
Corp.
3.3%
Gold
AngloGold
Ashanti
Ltd.
3.2%
Gold
SSR
Mining,
Inc.
3.0%
Gold
Perseus
Mining
Ltd.
2.9%
Gold
Centerra
Gold,
Inc.
2.8%
Gold
Performance
Summary
as
of
January
31,
2021
Franklin
Gold
and
Precious
Metals
Fund
7
franklintempleton.com
Semiannual
Report
The
performance
table
does
not
reflect
any
taxes
that
a
shareholder
would
pay
on
Fund
dividends,
capital
gain
distributions,
if
any,
or
any
realized
gains
on
the
sale
of
Fund
shares.
Total
return
reflects
reinvestment
of
the
Fund’s
dividends
and
capital
gain
distributions,
if
any,
and
any
unrealized
gains
or
losses.
Your
dividend
income
will
vary
depending
on
dividends
or
interest
paid
by
securities
in
the
Fund’s
portfolio,
adjusted
for
operating
expenses
of
each
class.
Capital
gain
distributions
are
net
profits
realized
from
the
sale
of
portfolio
securities.
Performance
as
of
1/31/21
Cumulative
total
return
excludes
sales
charges.
Average
annual
total
return
includes
maximum
sales
charges.
Sales
charges
will
vary
depending
on
the
size
of
the
investment
and
the
class
of
share
purchased.
The
maximum
is
5.50%
and
the
minimum
is
0%.
Class
A
:
5.50%
maximum
initial
sales
charge;
Advisor
Class:
no
sales
charges.
For
other
share
classes,
visit
franklintempleton.com.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236
.
Share
Class
Cumulative
Total
Return
1
Average
Annual
Total
Return
2
–
A
3
6-Month
-7.38%
-12.47%
1-Year
+36.43%
+28.91%
5-Year
+154.79%
+19.21%
10-Year
-31.88%
-4.31%
Advisor
6-Month
-7.26%
-7.26%
1-Year
+36.73%
+36.73%
5-Year
+157.81%
+20.85%
10-Year
-30.16%
-3.53%
See
page
8
for
Performance
Summary
footnotes.
Franklin
Gold
and
Precious
Metals
Fund
Performance
Summary
8
franklintempleton.com
Semiannual
Report
Each
class
of
shares
is
available
to
certain
eligible
investors
and
has
different
annual
fees
and
expenses,
as
described
in
the
prospectus.
All
investments
involve
risks,
including
possible
loss
of
principal.
The
Fund
concentrates
in
the
precious
metals
sector,
which
involves
fluctuations
in
the
prices
of
gold
and
other
precious
metals
and
increased
susceptibility
to
adverse
economic
and
regulatory
developments
affecting
the
sector.
In
times
of
stable
econom-
ic
growth,
traditional
equity
and
debt
investments
could
offer
greater
appreciation
potential
and
the
prices
of
gold
and
other
precious
metals
may
be
adversely
affected.
In
addition,
the
Fund
is
subject
to
the
risks
of
currency
fluctuation
and
political
uncertainty
associated
with
foreign
(non-U.S.)
investing.
Investments
in
emerging
and
frontier
markets
involve
heightened
risks
related
to
the
same
factors,
in
addition
to
those
associated
with
their
relatively
small
size
and
lesser
liquidity.
The
Fund
may
also
heavily
invest
in
smaller
companies,
which
can
be
particularly
sensitive
to
changing
economic
conditions,
and
their
prospects
for
growth
are
less
certain
than
those
of
larger,
more
established
companies.
Investing
in
a
non-diversified
fund
involves
the
risk
of
greater
price
fluctuation
than
a
more
diversified
portfolio.
Unexpected
events
and
their
aftermaths,
such
as
the
spread
of
deadly
diseases;
natural,
environmental
or
man-made
disasters;
financial,
political
or
social
disruptions;
terrorism
and
war;
and
other
tragedies
or
catastrophes,
can
cause
investor
fear
and
panic,
which
can
adversely
affect
the
economies
of
many
companies,
sectors,
nations,
regions
and
the
market
in
general,
in
ways
that
cannot
necessarily
be
foreseen.
The
Fund’s
prospectus
also
includes
a
description
of
the
main
investment
risks.
1.
Cumulative
total
return
represents
the
change
in
value
of
an
investment
over
the
periods
indicated.
2.
Average
annual
total
return
represents
the
average
annual
change
in
value
of
an
investment
over
the
periods
indicated.
Return
for
less
than
one
year,
if
any,
has
not
been
annualized.
3.
Prior
to
9/10/18
these
shares
were
offered
at
a
higher
initial
sales
charge
of
5.75%,
thus
actual
returns
(with
sales
charges)
would
have
differed.
Average
annual
total
returns
(with
sales
charges)
have
been
restated
to
reflect
the
current
maximum
initial
sales
charge
of
5.50%.
4.
Figures
are
as
stated
in
the
Fund’s
current
prospectus
and
may
differ
from
the
expense
ratios
disclosed
in
the
Your
Fund’s
Expenses
and
Financial
Highlights
sections
in
this
report.
In
periods
of
market
volatility,
assets
may
decline
significantly,
causing
total
annual
Fund
operating
expenses
to
become
higher
than
the
figures
shown.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
Distributions
(8/1/20–1/31/21)
Share
Class
Net
Investment
Income
A
$2.6501
C
$2.4933
R6
$2.7337
Advisor
$2.7082
Total
Annual
Operating
Expenses
4
Share
Class
A
0.93%
Advisor
0.68%
Your
Fund’s
Expenses
Franklin
Gold
and
Precious
Metals
Fund
9
franklintempleton.com
Semiannual
Report
As
a
Fund
shareholder,
you
can
incur
two
types
of
costs:
(1)
transaction
costs,
including
sales
charges
(loads)
on
Fund
purchases
and
redemptions;
and
(2)
ongoing
Fund
costs,
including
management
fees,
distribution
and
service
(12b-1)
fees,
and
other
Fund
expenses.
All
mutual
funds
have
ongoing
costs,
sometimes
referred
to
as
operating
expenses.
The
table
below
shows
ongoing
costs
of
investing
in
the
Fund
and
can
help
you
understand
these
costs
and
compare
them
with
those
of
other
mutual
funds.
The
table
assumes
a
$1,000
investment
held
for
the
six
months
indicated.
Actual
Fund
Expenses
The
table
below
provides
information
about
actual
account
values
and
actual
expenses
in
the
columns
under
the
heading
“Actual.”
In
these
columns
the
Fund’s
actual
return,
which
includes
the
effect
of
Fund
expenses,
is
used
to
calculate
the
“Ending
Account
Value”
for
each
class
of
shares.
You
can
estimate
the
expenses
you
paid
during
the
period
by
following
these
steps
(
of
course,
your
account
value
and
expenses
will
differ
from
those
in
this
illustration
):
Divide
your
account
value
by
$1,000
(
if
your
account
had
an
$8,600
value,
then
$8,600
÷
$1,000
=
8.6
).
Then
multiply
the
result
by
the
number
in
the
row
for
your
class
of
shares
under
the
headings
“Actual”
and
“Expenses
Paid
During
Period”
(
if
Actual
Expenses
Paid
During
Period
were
$7.50,
then
8.6
x
$7.50
=
$64.50
).
In
this
illustration,
the
actual
expenses
paid
this
period
are
$64.50.
Hypothetical
Example
for
Comparison
with
Other
Funds
Under
the
heading
“Hypothetical”
in
the
table,
information
is
provided
about
hypothetical
account
values
and
hypothetical
expenses
based
on
the
Fund’s
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund’s
actual
return.
This
information
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period,
but
it
can
help
you
compare
ongoing
costs
of
investing
in
the
Fund
with
those
of
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
for
the
class
of
shares
you
hold
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Please
note
that
expenses
shown
in
the
table
are
meant
to
highlight
ongoing
costs
and
do
not
reflect
any
transactional
costs.
Therefore,
information
under
the
heading
“Hypothetical”
is
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
compare
total
costs
of
owning
different
funds.
In
addition,
if
transactional
costs
were
included,
your
total
costs
would
have
been
higher.
1.
Expenses
are
equal
to
the
annualized
expense
ratio
for
the
six-month
period
as
indicated
above—in
the
far
right
column—multiplied
by
the
simple
average
account
value
over
the
period
indicated,
and
then
multiplied
by
184/365
to
reflect
the
one-half
year
period.
2.
Reflects
expenses
after
fee
waivers
and
expense
reimbursements.
Does
not
include
acquired
fund
fees
and
expenses.
Actual
(actual
return
after
expenses)
Hypothetical
(5%
annual
return
before
expenses)
Share
Class
Beginning
Account
Value
8/1/20
Ending
Account
Value
1/31/21
Expenses
Paid
During
Period
8/1/20–1/31/21
1,2
Ending
Account
Value
1/31/21
Expenses
Paid
During
Period
8/1/20–1/31/21
1,2
a
Net
Annualized
Expense
Ratio
2
A
$1,000
$926.22
$4.20
$1,020.85
$4.40
0.87%
C
$1,000
$922.63
$7.83
$1,017.06
$8.22
1.62%
R6
$1,000
$928.01
$2.53
$1,022.58
$2.65
0.52%
Advisor
$1,000
$927.39
$2.99
$1,022.10
$3.14
0.62%
Franklin
Gold
and
Precious
Metals
Fund
Financial
Highlights
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
10
a
Six
Months
Ended
January
31,
2021
(unaudited)
Year
Ended
July
31,
2020
2019
2018
2017
2016
Class
A
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$28.04
$16.68
$13.56
$16.19
$24.06
$11.63
Income
from
investment
operations
a
:
Net
investment
income
(loss)
b
........
—
c
(0.04)
(0.02)
(0.06)
(0.04)
(0.09)
Net
realized
and
unrealized
gains
(losses)
(2.06)
11.40
3.14
(2.51)
(6.45)
12.52
Total
from
investment
operations
........
(2.06)
11.36
3.12
(2.57)
(6.49)
12.43
Less
distributions
from:
Net
investment
income
..............
(2.65)
—
—
(0.06)
(1.38)
—
Net
asset
value,
end
of
period
..........
$23.33
$28.04
$16.68
$13.56
$16.19
$24.06
Total
return
d
.......................
(7.38)%
68.05%
23.01%
(15.92)%
(26.85)%
106.88%
Ratios
to
average
net
assets
e
Expenses
f
........................
0.87%
g
0.93%
g
0.98%
g
1.02%
g
0.98%
g
1.11%
Net
investment
income
(loss)
..........
0.01%
(0.20)%
(0.15)%
(0.37)%
(0.24)%
(0.57)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$917,223
$938,555
$645,108
$587,294
$776,677
$988,701
Portfolio
turnover
rate
................
9.55%
17.00%
12.82%
8.36%
13.99%
16.76%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Amount
rounds
to
less
than
$0.01
per
share.
d
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
e
Ratios
are
annualized
for
periods
less
than
one
year.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
g
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Gold
and
Precious
Metals
Fund
Financial
Highlights
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
11
a
Six
Months
Ended
January
31,
2021
(unaudited)
Year
Ended
July
31,
2020
2019
2018
2017
2016
Class
C
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$25.42
$15.24
$12.49
$14.96
$22.39
$10.90
Income
from
investment
operations
a
:
Net
investment
(loss)
b
..............
(0.09)
(0.16)
(0.11)
(0.15)
(0.17)
(0.18)
Net
realized
and
unrealized
gains
(losses)
(1.86)
10.34
2.86
(2.32)
(5.99)
11.67
Total
from
investment
operations
........
(1.95)
10.18
2.75
(2.47)
(6.16)
11.49
Less
distributions
from:
Net
investment
income
..............
(2.49)
—
—
—
(1.27)
—
Net
asset
value,
end
of
period
..........
$20.98
$25.42
$15.24
$12.49
$14.96
$22.39
Total
return
c
.......................
(7.74)%
66.80%
22.02%
(16.51)%
(27.41)%
105.41%
Ratios
to
average
net
assets
d
Expenses
e
........................
1.62%
f
1.68%
f
1.73%
f
1.77%
f
1.73%
f
1.86%
Net
investment
(loss)
................
(0.73)%
(0.94)%
(0.90)%
(1.12)%
(0.99)%
(1.32)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$92,819
$106,271
$75,129
$94,997
$137,487
$200,179
Portfolio
turnover
rate
................
9.55%
17.00%
12.82%
8.36%
13.99%
16.76%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
does
not
reflect
sales
commissions
or
contingent
deferred
sales
charges,
if
applicable,
and
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
f
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Gold
and
Precious
Metals
Fund
Financial
Highlights
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
12
a
Six
Months
Ended
January
31,
2021
(unaudited)
Year
Ended
July
31,
2020
2019
2018
2017
2016
Class
R6
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$30.20
$17.90
$14.50
$17.31
$25.58
$12.29
Income
from
investment
operations
a
:
Net
investment
income
(loss)
b
........
0.05
0.03
0.04
0.01
0.04
(0.01)
Net
realized
and
unrealized
gains
(losses)
(2.22)
12.27
3.36
(2.68)
(6.87)
13.30
Total
from
investment
operations
........
(2.17)
12.30
3.40
(2.67)
(6.83)
13.29
Less
distributions
from:
Net
investment
income
..............
(2.73)
—
—
(0.14)
(1.44)
—
Net
asset
value,
end
of
period
..........
$25.30
$30.20
$17.90
$14.50
$17.31
$25.58
Total
return
c
.......................
(7.20)%
68.66%
23.45%
(15.50)%
(26.53)%
108.14%
Ratios
to
average
net
assets
d
Expenses
before
waiver
and
payments
by
affiliates
..........................
0.69%
0.72%
0.83%
0.79%
0.57%
0.63%
Expenses
net
of
waiver
and
payments
by
affiliates
..........................
0.52%
e
0.56%
e
0.58%
e
0.55%
e
0.52%
e
0.59%
Net
investment
income
(loss)
..........
0.36%
0.17%
0.25%
0.10%
0.21%
(0.05)%
Supplemental
data
Net
assets,
end
of
period
(000’s)
........
$19,441
$20,574
$10,808
$8,153
$4,635
$3,764
Portfolio
turnover
rate
................
9.55%
17.00%
12.82%
8.36%
13.99%
16.76%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Total
return
is
not
annualized
for
periods
less
than
one
year.
d
Ratios
are
annualized
for
periods
less
than
one
year.
e
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Gold
and
Precious
Metals
Fund
Financial
Highlights
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
13
a
Six
Months
Ended
January
31,
2021
(unaudited)
Year
Ended
July
31,
2020
2019
2018
2017
2016
Advisor
Class
Per
share
operating
performance
(for
a
share
outstanding
throughout
the
period)
Net
asset
value,
beginning
of
period
.....
$29.88
$17.73
$14.38
$17.17
$25.38
$12.23
Income
from
investment
operations
a
:
Net
investment
income
(loss)
b
........
0.04
0.01
0.01
(0.02)
—
c
(0.05)
Net
realized
and
unrealized
gains
(losses)
(2.20)
12.14
3.34
(2.67)
(6.81)
13.20
Total
from
investment
operations
........
(2.16)
12.15
3.35
(2.69)
(6.81)
13.15
Less
distributions
from:
Net
investment
income
..............
(2.71)
—
—
(0.10)
(1.40)
—
Net
asset
value,
end
of
period
..........
$25.01
$29.88
$17.73
$14.38
$17.17
$25.38
Total
return
d
.......................
(7.26)%
68.47%
23.30%
(15.70)%
(26.69)%
107.52%
Ratios
to
average
net
assets
e
Expenses
f
.........................
0.62%
g
0.68%
g
0.73%
g
0.77%
g
0.73%
g
0.86%
Net
investment
income
(loss)
..........
0.26%
0.05%
0.10%
(0.12)%
0.01%
(0.32)%
Supplemental
data
Net
assets,
en
d
of
period
(000’s)
........
$264,087
$280,317
$143,589
$130,812
$164,253
$207,574
Portfolio
turnover
rate
................
9.55%
17.00%
12.82%
8.36%
13.99%
16.76%
a
The
amount
shown
for
a
share
outstanding
throughout
the
period
may
not
correlate
with
the
Statement
of
Operations
for
the
period
due
to
the
timing
of
sales
and
repurchases
of
the
Fund’s
shares
in
relation
to
income
earned
and/or
fluctuating
fair
value
of
the
investments
of
the
Fund.
b
Based
on
average
daily
shares
outstanding.
c
Amount
rounds
to
less
than
$0.01
per
share.
d
Total
return
is
not
annualized
for
periods
less
than
one
year.
e
Ratios
are
annualized
for
periods
less
than
one
year.
f
Benefit
of
waiver
and
payments
by
affiliates
rounds
to
less
than
0.01%.
g
Benefit
of
expense
reduction
rounds
to
less
than
0.01%.
Franklin
Gold
and
Precious
Metals
Fund
Statement
of
Investments
(unaudited),
January
31,
2021
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
14
a
a
Country
Shares
a
Value
a
Common
Stocks
95.7%
Copper
0.5%
a,b
Imperial
Metals
Corp.
..................................
Canada
1,950,300
$
6,695,720
a
Diversified
Metals
&
Mining
8.9%
a,c
Adventus
Mining
Corp.,
144A
............................
Canada
6,350,000
4,717,682
a,c
Bluestone
Resources,
Inc.,
144A
..........................
Canada
6,500,000
9,454,915
a
Clean
Air
Metals,
Inc.
..................................
Canada
3,800,000
1,188,707
a,c,d
Euro
Sun
Mining,
Inc.,
144A
.............................
Canada
10,000,000
2,502,542
a,d,e,f
G
Mining
Ventures
Corp.,
144A
...........................
Canada
8,250,000
8,246,303
a,d
Geopacific
Resources
Ltd.
..............................
Australia
16,223,922
5,280,569
a,c
INV
Metals,
Inc.,
144A
..................................
Canada
6,565,000
2,413,036
a,c
Ivanhoe
Mines
Ltd.,
144A
...............................
Canada
5,735,000
27,403,496
a
Ivanhoe
Mines
Ltd.,
A
..................................
Canada
141,800
677,562
a,b,c
Mawson
Gold
Ltd.,
144A
................................
Canada
7,700,000
1,926,957
a
Orla
Mining
Ltd.
......................................
Canada
3,490,713
15,069,004
a,c
Orla
Mining
Ltd.,
144A
..................................
Canada
2,000,000
8,633,769
b,e,f
Osisko
Development
Corp.,
144A
.........................
Canada
460,000
2,705,403
a,c
Osisko
Development
Corp.,
144A
.........................
Canada
1,015,000
6,120,005
a
Prime
Mining
Corp.
....................................
Canada
1,500,000
2,979,589
a,d
Talisker
Resources
Ltd.
.................................
Canada
15,300,000
3,589,583
a,d,e,f
Troilus
Gold
Corp.,
144A
................................
Canada
6,900,000
5,337,444
a
Vizsla
Resources
Corp.
.................................
Canada
3,350,000
4,086,963
a
Western
Copper
&
Gold
Corp.
............................
Canada
2,430,000
2,812,544
115,146,073
Environmental
&
Facilities
Services
0.2%
a,b
Clean
TeQ
Holdings
Ltd.
................................
Australia
13,600,000
2,741,404
a
Gold
73.5%
Agnico
Eagle
Mines
Ltd.
................................
Canada
37,000
2,584,450
Alamos
Gold,
Inc.,
(CAD
Traded),
A
........................
Canada
2,828,316
22,693,769
Alamos
Gold,
Inc.,
(USD
Traded),
A
........................
Canada
2,514,500
20,116,000
AngloGold
Ashanti
Ltd.,
ADR
.............................
Tanzania
1,784,823
41,871,948
a,c
Argonaut
Gold,
Inc.,
144A
...............................
United
States
2,350,000
4,263,705
a
Artemis
Gold,
Inc.
.....................................
Canada
1,725,000
8,215,570
a,c,d
Ascot
Resources
Ltd.,
144A
.............................
Canada
16,220,000
15,094,862
B2Gold
Corp.
........................................
Canada
8,593,694
42,474,502
Barrick
Gold
Corp.
....................................
Canada
3,179,383
71,122,798
a,c,d
Battle
North
Gold
Corp.,
144A
............................
Canada
9,608,900
13,075,378
a,b
Belo
Sun
Mining
Corp.
.................................
Canada
3,500,000
2,764,526
a,c
Belo
Sun
Mining
Corp.,
144A
.............................
Canada
3,800,000
3,001,486
a
Breaker
Resources
NL
.................................
Australia
16,000,000
2,438,409
Centamin
plc
.........................................
Egypt
12,915,200
20,212,157
Centerra
Gold,
Inc.
....................................
Kyrgyzstan
547,800
5,676,351
a,c
Centerra
Gold,
Inc.,
144A
...............................
Kyrgyzstan
2,893,400
29,981,661
a
Chalice
Mining
Ltd.
....................................
Australia
11,780,641
35,241,245
a,b
Corvus
Gold,
Inc.
.....................................
Canada
2,000,000
4,379,448
a,d
Dacian
Gold
Ltd.
......................................
Australia
32,555,556
11,859,500
Dundee
Precious
Metals,
Inc.
............................
Canada
2,310,000
14,687,026
a
Eldorado
Gold
Corp.
...................................
Turkey
1,848,724
20,747,000
a
Emerald
Resources
NL
.................................
Australia
17,070,000
10,620,526
Endeavour
Mining
Corp.
................................
Ivory
Coast
1,332,222
28,296,825
a,c
First
Mining
Gold
Corp.,
144A
............................
Canada
7,500,000
2,316,806
a,b
Galiano
Gold,
Inc.
.....................................
Canada
9,572,375
11,004,451
a
Gascoyne
Resources
Ltd.
...............................
Australia
8,368,370
3,279,181
Gold
Fields
Ltd.
.......................................
South
Africa
1,074,800
10,077,534
a
Gold
Standard
Ventures
Corp.
............................
Canada
4,070,000
2,800,970
a
Golden
Star
Resources
Ltd.
.............................
United
States
3,689,533
13,872,644
a
Great
Panther
Mining
Ltd.
...............................
Canada
5,171,889
4,174,749
a,d
HighGold
Mining,
Inc.
..................................
Canada
4,303,000
4,845,796
Franklin
Gold
and
Precious
Metals
Fund
Statement
of
Investments
(unaudited)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
15
a
a
Country
Shares
a
Value
a
Common
Stocks
(continued)
Gold
(continued)
a
Integra
Resources
Corp.,
(CAD
Traded)
....................
Canada
2,260,000
$
7,387,816
a
Integra
Resources
Corp.,
(USD
Traded)
....................
Canada
300,000
978,000
Kirkland
Lake
Gold
Ltd.
.................................
Canada
531,123
20,410,874
a,b
Liberty
Gold
Corp.
.....................................
Canada
11,379,800
13,527,251
a,b,d
Lion
One
Metals
Ltd.
...................................
Canada
4,614,100
5,448,730
a,c,d
Lion
One
Metals
Ltd.,
144A
..............................
Canada
4,024,000
4,751,889
a,e,f
Lydian
International
Ltd.
................................
Jersey
6,375,000
—
a,e,f
Lydian
International
Ltd.,
144A
...........................
Jersey
25,250,000
—
a,b
Marathon
Gold
Corp.
...................................
Canada
2,306,000
5,085,571
a,b
Midas
Gold
Corp.
.....................................
Canada
362,090
2,746,753
c
Midas
Gold
Corp.,
144A
................................
Canada
403,000
3,057,089
Newcrest
Mining
Ltd.
...................................
Australia
2,426,914
46,124,017
Newmont
Corp.
.......................................
United
States
880,614
52,484,594
Northern
Star
Resources
Ltd.
............................
Australia
973,054
9,415,884
a
O3
Mining,
Inc.
.......................................
Canada
1,850,000
4,398,217
a
OceanaGold
Corp.
....................................
Australia
5,762,689
10,140,025
a
OceanaGold
Corp.
....................................
Australia
3,325,799
5,852,075
Osisko
Gold
Royalties
Ltd.
..............................
Canada
275,000
3,073,238
a
Pantoro
Ltd.
.........................................
Australia
38,400,000
6,850,978
a
Perseus
Mining
Ltd.
...................................
Australia
41,558,141
36,890,307
a,c
Premier
Gold
Mines
Ltd.,
144A
...........................
Canada
2,618,750
6,471,612
a
Pretium
Resources,
Inc.
................................
Canada
2,149,000
23,192,461
a,e,f
Probe
Metals,
Inc.,
144A
................................
Canada
3,400,000
4,029,257
a,d
Red
5
Ltd.
...........................................
Australia
162,268,146
26,330,421
a,d
RTG
Mining,
Inc.
......................................
Australia
1,769,918
262,989
a,c,d
RTG
Mining,
Inc.,
144A
.................................
Australia
2,397,790
356,284
a,d
RTG
Mining,
Inc.,
CDI
..................................
Australia
50,687,582
6,972,381
a,d
Saturn
Metals
Ltd.
.....................................
Australia
6,200,000
2,029,838
c
Shandong
Gold
Mining
Co.
Ltd.,
H,
144A,
Reg
S
..............
China
1,600,000
3,345,607
a,b
Skeena
Resources
Ltd.
.................................
Canada
7,150,000
17,389,927
a,e,f
Skeena
Resources
Ltd.
.................................
Canada
400,000
908,103
a
SolGold
plc,
(CAD
Traded)
..............................
Australia
13,650,000
5,657,699
a
SolGold
plc,
(GBP
Traded)
..............................
Australia
7,000,000
2,766,917
a
SSR
Mining,
Inc.
......................................
Canada
2,186,555
38,440,413
a
St.
Augustine
Gold
and
Copper
Ltd.,
(CAD
Traded)
............
United
States
5,613,836
460,978
a,c
St.
Augustine
Gold
and
Copper
Ltd.,
(CAD
Traded),
144A
.......
United
States
16,383,333
1,345,312
a,c
St.
Augustine
Gold
and
Copper
Ltd.,
(USD
Traded),
144A
.......
United
States
10,000,000
821,146
St.
Barbara
Ltd.
.......................................
Australia
9,008,021
15,033,979
a,c,d
Superior
Gold,
Inc.,
144A
...............................
Canada
5,350,000
3,054,274
a
Teranga
Gold
Corp.
....................................
Canada
3,582,751
35,443,654
a
Torex
Gold
Resources,
Inc.
..............................
Canada
136,100
1,792,386
a,c
Torex
Gold
Resources,
Inc.,
144A
.........................
Canada
1,450,000
19,095,957
a
West
African
Resources
Ltd.
.............................
Australia
10,705,384
7,390,331
a
Wiluna
Mining
Corp.
Ltd.
................................
Australia
5,724,000
5,997,301
951,003,808
Precious
Metals
&
Minerals
11.4%
Anglo
American
Platinum
Ltd.
............................
South
Africa
165,656
16,480,055
a,d
Benchmark
Metals,
Inc.
.................................
Canada
6,890,300
5,981,257
a
Eastern
Platinum
Ltd.
..................................
Canada
5,184,204
1,256,826
a,c
GoGold
Resources,
Inc.,
144A
...........................
Canada
8,787,858
17,799,759
Impala
Platinum
Holdings
Ltd.
............................
South
Africa
2,060,000
27,818,832
Impala
Platinum
Holdings
Ltd.,
ADR
.......................
South
Africa
1,236,100
16,699,711
a
Northam
Platinum
Ltd.
.................................
South
Africa
1,109,019
13,777,528
a,b
Osisko
Mining,
Inc.
....................................
Canada
6,250,000
15,200,985
a,d
Platinum
Group
Metals
Ltd.,
(CAD
Traded)
..................
South
Africa
10,000
37,538
a,b,d
Platinum
Group
Metals
Ltd.,
(CAD
Traded)
..................
South
Africa
2,042,787
7,668,240
a,c,d
Platinum
Group
Metals
Ltd.,
(CAD
Traded),
144A
.............
South
Africa
97,760
366,973
Franklin
Gold
and
Precious
Metals
Fund
Statement
of
Investments
(unaudited)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
16
a
a
Country
Shares
a
Value
a
Common
Stocks
(continued)
Precious
Metals
&
Minerals
(continued)
a,d
Platinum
Group
Metals
Ltd.,
(USD
Traded)
..................
South
Africa
4,241,856
$
15,779,704
a,c,d
Platinum
Group
Metals
Ltd.,
(USD
Traded),
144A
.............
South
Africa
36,628
137,495
a
Royal
Bafokeng
Platinum
Ltd.
............................
South
Africa
1,693,527
7,701,056
146,705,959
Silver
1.2%
Hochschild
Mining
plc
..................................
Peru
3,388,520
10,646,780
Pan
American
Silver
Corp.
..............................
Canada
145,021
4,691,889
15,338,669
Total
Common
Stocks
(Cost
$824,688,392)
.....................................
1,237,631,633
Rights
a
a
Rights
0.1%
Silver
0.1%
a
Pan
American
Silver
Corp.,
CVR
,
2/20/49
...................
Canada
1,850,600
1,424,962
Total
Rights
(Cost
$856,771)
..................................................
1,424,962
Warrants
a
a
a
Warrants
0.6%
Diversified
Metals
&
Mining
0.4%
a,e,f
Bluestone
Resources,
Inc.
,
3/19/21
........................
Canada
550,000
102,503
a,e,f
Clean
Air
Metals,
Inc.
,
2/11/22
............................
Canada
1,900,000
197,201
a,d,e,f
Euro
Sun
Mining,
Inc.
,
6/05/23
...........................
Canada
5,000,000
109,060
a,d,e,f
G
Mining
Ventures
Corp.
,
144A,
5/19/22
....................
Canada
4,125,000
2,207,064
a,e,f
Mawson
Gold
Ltd.
,
8/13/20
..............................
Canada
3,850,000
133,360
a,e,f
Orla
Mining
Ltd.
,
2/15/21
................................
Canada
460,000
1,140,377
a,e,f
Osisko
Development
Corp.
,
144A,
12/01/23
.................
Canada
737,500
476,041
a,d,e,f
Talisker
Resources
Ltd.
,
144A,
8/31/21
.....................
Canada
5,650,000
694
a,e,f
Vizsla
Resources
Corp.
,
144A,
7/30/22
.....................
Canada
3,350,000
773,198
5,139,498
Gold
0.1%
a,c,e
First
Mining
Gold
Corp.
,
144A,
8/26/22
.....................
Canada
3,750,000
73,466
a,e,f
Marathon
Gold
Corp.
,
5/26/21
............................
Canada
1,153,000
798,097
a,e,f
O3
Mining,
Inc.
,
6/18/22
................................
Canada
850,000
310,812
a,e,f
Probe
Metals,
Inc.
,
144A,
11/24/22
........................
Canada
1,700,000
261,929
1,444,304
Precious
Metals
&
Minerals
0.1%
a,e,f
Osisko
Mining,
Inc.
,
12/23/21
............................
Canada
2,125,000
509,619
Total
Warrants
(Cost
$172,099)
................................................
7,093,421
Principal
Amount
*
Convertible
Bonds
0.2%
Precious
Metals
&
Minerals
0.2%
d
Platinum
Group
Metals
Ltd.,
Sub.
Note,
6.875%,
7/01/22
........
South
Africa
3,000,000
2,865,000
Total
Convertible
Bonds
(Cost
$3,000,000)
.....................................
2,865,000
Total
Long
Term
Investments
(Cost
$828,717,262)
...............................
1,249,015,016
a
Franklin
Gold
and
Precious
Metals
Fund
Statement
of
Investments
(unaudited)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
17
See
Abbreviations
on
page
34
.
Short
Term
Investments
3.5%
a
a
Country
Shares
a
Value
a
a
a
a
a
a
Money
Market
Funds
3.0%
g,h
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
0%
........
United
States
39,090,817
$
39,090,817
Total
Money
Market
Funds
(Cost
$39,090,817)
..................................
39,090,817
i
Investments
from
Cash
Collateral
Received
for
Loaned
Securities
0.4%
Money
Market
Funds
0.4%
g,h
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
0%
........
United
States
4,939,000
4,939,000
Principal
Amount
i
Investments
from
Cash
Collateral
Received
for
Loaned
Securities
0.1%
Repurchase
Agreements
0.1%
j
Joint
Repurchase
Agreement,
J.P.
Morgan
Securities
LLC,
0.04%,
2/01/21
(Maturity
Value
$1,309,504)
Collateralized
by
U.S.
Treasury
Notes,
2%
-
2.5%,
8/31/21
-
1/31/24
(valued
at
$1,335,690)
..........................
1,309,500
1,309,500
Total
Investments
from
Cash
Collateral
Received
for
Loaned
Securities
(Cost
$6,248,500)
.................................................................
6,248,500
Total
Short
Term
Investments
(Cost
$45,339,317
)
................................
45,339,317
a
Total
Investments
(Cost
$874,056,579)
100.1%
..................................
$1,294,354,333
Other
Assets,
less
Liabilities
(0.1)%
...........................................
(784,729)
Net
Assets
100.0%
...........................................................
$1,293,569,604
*
The
principal
amount
is
stated
in
U.S.
dollars
unless
otherwise
indicated.
a
Non-income
producing.
b
A
portion
or
all
of
the
security
is
on
loan
at
January
31,
2021.
See
Note
1(d).
c
Security
was
purchased
pursuant
to
Rule
144A
or
Regulation
S
under
the
Securities
Act
of
1933.
144A
securities
may
be
sold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers
or
in
a
public
offering
registered
under
the
Securities
Act
of
1933.
Regulation
S
securities
cannot
be
sold
in
the
United
States
without
either
an
effective
registration
statement
filed
pursuant
to
the
Securities
Act
of
1933,
or
pursuant
to
an
exemption
from
registration.
At
January
31,
2021,
the
aggregate
value
of
these
securities
was
$191,583,163,
representing
14.8%
of
net
assets.
d
See
Note
10
regarding
holdings
of
5%
voting
securities.
e
Fair
valued
using
significant
unobservable
inputs.
See
Note
12
regarding
fair
value
measurements.
f
See
Note
9
regarding
restricted
securities.
g
See
Note
3(f)
regarding
investments
in
affiliated
management
investment
companies.
h
The
rate
shown
is
the
annualized
seven-day
effective
yield
at
period
end.
i
See
Note
1(d)
regarding
securities
on
loan.
j
See
Note
1(c)
regarding
joint
repurchase
agreement.
Franklin
Gold
and
Precious
Metals
Fund
Financial
Statements
Statement
of
Assets
and
Liabilities
January
31,
2021
(unaudited)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
18
Franklin
Gold
and
Precious
Metals
Fund
Assets:
Investments
in
securities:
Cost
-
Unaffiliated
issuers
...................................................................
$650,363,278
Cost
-
Non-controlled
affiliates
(Note
3
f
and
10
)
...................................................
223,693,301
Value
-
Unaffiliated
issuers
(Includes
securities
loaned
of
$5,395,553)
.................................
$1,096,132,708
Value
-
Non-controlled
affiliates
(Note
3
f
and
10
)
..................................................
198,221,625
Receivables:
Investment
securities
sold
...................................................................
2,895,541
Capital
shares
sold
........................................................................
7,339,625
Dividends
and
interest
.....................................................................
542,143
Other
assets
..............................................................................
47,240
Total
assets
..........................................................................
1,305,178,882
Liabilities:
Payables:
Investment
securities
purchased
..............................................................
1,914,101
Capital
shares
redeemed
...................................................................
2,363,573
Management
fees
.........................................................................
534,768
Distribution
fees
..........................................................................
289,766
Transfer
agent
fees
........................................................................
244,993
Funds
advanced
by
custodian
.................................................................
1,954
Payable
upon
return
of
securities
loaned
(Note
1
d
)
..................................................
6,248,500
Accrued
expenses
and
other
liabilities
...........................................................
11,623
Total
liabilities
.........................................................................
11,609,278
Net
assets,
at
value
.................................................................
$1,293,569,604
Net
assets
consist
of:
Paid-in
capital
.............................................................................
$1,738,924,399
Total
distributable
earnings
(losses)
.............................................................
(445,354,795)
Net
assets,
at
value
.................................................................
$1,293,569,604
Franklin
Gold
and
Precious
Metals
Fund
Financial
Statements
Statement
of
Assets
and
Liabilities
(continued)
January
31,
2021
(unaudited)
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
19
Franklin
Gold
and
Precious
Metals
Fund
Class
A:
Net
assets,
at
value
.......................................................................
$917,222,658
Shares
outstanding
........................................................................
39,322,128
Net
asset
value
per
share
a
..................................................................
$23.33
Maximum
offering
price
per
share
(net
asset
value
per
share
÷
94.50%)
................................
$24.69
Class
C:
Net
assets,
at
value
.......................................................................
$92,818,925
Shares
outstanding
........................................................................
4,424,590
Net
asset
value
and
maximum
offering
price
per
share
a
.............................................
$20.98
Class
R6:
Net
assets,
at
value
.......................................................................
$19,441,484
Shares
outstanding
........................................................................
768,478
Net
asset
value
and
maximum
offering
price
per
share
.............................................
$25.30
Advisor
Class:
Net
assets,
at
value
.......................................................................
$264,086,537
Shares
outstanding
........................................................................
10,560,744
Net
asset
value
and
maximum
offering
price
per
share
.............................................
$25.01
a
Redemption
price
is
equal
to
net
asset
value
less
contingent
deferred
sales
charges,
if
applicable.
Franklin
Gold
and
Precious
Metals
Fund
Financial
Statements
Statement
of
Operations
For
the
six
months
ended
January
31,
2021
(unaudited)
franklintempleton.com
Semiannual
Report
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
20
Franklin
Gold
and
Precious
Metals
Fund
Investment
income:
Dividends:
(net
of
foreign
taxes
of
$473,638)
Unaffiliated
issuers
........................................................................
$5,330,570
Interest:
Non-controlled
affiliates
(Note
3
f
and
10
)
........................................................
103,125
Income
from
securities
loaned:
Unaffiliated
entities
(net
of
fees
and
rebates)
.....................................................
375,074
Total
investment
income
...................................................................
5,808,769
Expenses:
Management
fees
(Note
3
a
)
...................................................................
3,083,489
Distribution
fees:
(Note
3c
)
Class
A
................................................................................
1,166,936
Class
C
................................................................................
509,549
Transfer
agent
fees:
(Note
3e
)
Class
A
................................................................................
582,387
Class
C
................................................................................
63,516
Class
R6
...............................................................................
20,174
Advisor
Class
............................................................................
172,174
Custodian
fees
(Note
4
)
......................................................................
29,787
Reports
to
shareholders
......................................................................
49,317
Registration
and
filing
fees
....................................................................
29,493
Professional
fees
...........................................................................
58,868
Trustees'
fees
and
expenses
..................................................................
14,373
Other
....................................................................................
11,903
Total
expenses
.........................................................................
5,791,966
Expense
reductions
(Note
4
)
...............................................................
(68)
Expenses
waived/paid
by
affiliates
(Note
3
f
and
3
g
)
..............................................
(30,745)
Net
expenses
.........................................................................
5,761,153
Net
investment
income
................................................................
47,616
Realized
and
unrealized
gains
(losses):
Net
realized
gain
(loss)
from:
Investments:
Unaffiliated
issuers
......................................................................
32,946,041
Non-controlled
affiliates
(Note
3
f
and
10
)
......................................................
(10,804,541)
Foreign
currency
transactions
................................................................
14,712
Net
realized
gain
(loss)
..................................................................
22,156,212
Net
change
in
unrealized
appreciation
(depreciation)
on:
Investments:
Unaffiliated
issuers
......................................................................
(167,116,107)
Non-controlled
affiliates
(Note
3
f
and
10
)
......................................................
45,468,052
Translation
of
other
assets
and
liabilities
denominated
in
foreign
currencies
..............................
(5,730)
Net
change
in
unrealized
appreciation
(depreciation)
............................................
(121,653,785)
Net
realized
and
unrealized
gain
(loss)
............................................................
(99,497,573)
Net
increase
(decrease)
in
net
assets
resulting
from
operations
..........................................
$(99,449,957)
Franklin
Gold
and
Precious
Metals
Fund
Financial
Statements
Statements
of
Changes
in
Net
Assets
franklintempleton.com
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Semiannual
Report
21
Franklin
Gold
and
Precious
Metals
Fund
Six
Months
Ended
January
31,
2021
(unaudited)
Year
Ended
July
31,
2020
Increase
(decrease)
in
net
assets:
Operations:
Net
investment
income
(loss)
............................................
$47,616
$(2,015,454)
Net
realized
gain
(loss)
.................................................
22,156,212
12,253,151
Net
change
in
unrealized
appreciation
(depreciation)
...........................
(121,653,785)
565,070,636
Net
increase
(decrease)
in
net
assets
resulting
from
operations
................
(99,449,957)
575,308,333
Distributions
to
shareholders:
Class
A
.............................................................
(91,536,537)
—
Class
C
.............................................................
(10,260,302)
—
Class
R6
............................................................
(1,886,753)
—
Advisor
Class
........................................................
(25,940,782)
—
Total
distributions
to
shareholders
..........................................
(129,624,374)
—
Capital
share
transactions:
(Note
2
)
Class
A
.............................................................
137,845,029
(124,090,549)
Class
C
.............................................................
4,861,017
(13,468,257)
Class
R6
............................................................
2,411,822
1,382,646
Advisor
Class
........................................................
31,810,094
31,949,531
Total
capital
share
transactions
............................................
176,927,962
(104,226,629)
Net
increase
(decrease)
in
net
assets
...................................
(52,146,369)
471,081,704
Net
assets:
Beginning
of
period
.....................................................
1,345,715,973
874,634,269
End
of
period
..........................................................
$1,293,569,604
$1,345,715,973
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
22
franklintempleton.com
Semiannual
Report
1.
Organization
and
Significant
Accounting
Policies
Franklin
Gold
and
Precious
Metals
Fund (Fund)
is
registered
under
the
Investment
Company
Act
of
1940
(1940
Act)
as
an
open-end
management
investment
company
and
applies
the
specialized
accounting
and
reporting
guidance
in
U.S.
Generally
Accepted
Accounting
Principles
(U.S.
GAAP).
The
Fund
offers
four
classes
of
shares:
Class
A,
Class
C,
Class
R6
and
Advisor
Class.
Class
C
shares
automatically
convert
to
Class
A
shares
after
they
have
been
held
for
10
years.
Each
class
of
shares
may
differ
by
its
initial
sales
load,
contingent
deferred
sales
charges,
voting
rights
on
matters
affecting
a
single
class,
its
exchange
privilege
and
fees
due
to
differing
arrangements
for
distribution
and
transfer
agent
fees.
The
following
summarizes
the
Fund’s
significant
accounting
policies.
a.
Financial
Instrument
Valuation
The
Fund's
investments
in
financial
instruments
are
carried
at
fair
value
daily.
Fair
value
is
the
price
that
would
be
received
to
sell
an
asset
or
paid
to
transfer
a
liability
in
an
orderly
transaction
between
market
participants
on
the
measurement
date.
The
Fund
calculates
the
net
asset
value
(NAV)
per
share
each business
day as
of
4
p.m.
Eastern
time
or
the
regularly
scheduled
close
of
the
New
York
Stock
Exchange
(NYSE),
whichever
is
earlier.
Under
compliance
policies
and
procedures
approved
by
the
Fund's
Board
of
Trustees
(the
Board),
the
Fund's
administrator
has
responsibility
for
oversight
of
valuation,
including
leading
the
cross-functional
Valuation
Committee
(VC).
The
Fund
may
utilize
independent
pricing
services,
quotations
from
securities
and
financial
instrument
dealers,
and
other
market
sources
to
determine
fair
value.
Equity
securities
listed
on
an
exchange
or
on
the
NASDAQ
National
Market
System
are
valued
at
the
last
quoted
sale
price
or
the
official
closing
price of
the
day,
respectively.
Foreign
equity
securities
are
valued
as
of
the
close
of
trading
on
the
foreign
stock
exchange
on
which
the
security
is
primarily
traded,
or
as
of
4
p.m.
Eastern
time.
The
value
is
then
converted
into
its
U.S.
dollar
equivalent
at
the
foreign
exchange
rate
in
effect
at
4
p.m.
Eastern
time
on
the
day
that
the
value
of
the
security
is
determined.
Over-the-counter
(OTC)
securities
are
valued
within
the
range
of
the
most
recent
quoted
bid
and
ask
prices.
Securities
that
trade
in
multiple
markets
or
on
multiple
exchanges
are
valued
according
to
the
broadest
and
most
representative
market.
Certain
equity
securities
are
valued
based
upon
fundamental
characteristics
or
relationships
to
similar
securities.
Debt
securities
generally
trade
in
the
OTC
market
rather
than
on
a
securities
exchange.
The
Fund's
pricing
services
use
multiple
valuation
techniques
to
determine
fair
value.
In
instances
where
sufficient
market
activity
exists,
the
pricing
services
may
utilize
a
market-based
approach
through
which
quotes
from
market
makers
are
used
to
determine
fair
value.
In
instances
where
sufficient
market
activity
may
not
exist
or
is
limited,
the
pricing
services
also
utilize
proprietary
valuation
models
which
may
consider
market
characteristics
such
as
benchmark
yield
curves,
credit
spreads,
estimated
default
rates,
anticipated
market
interest
rate
volatility,
coupon
rates,
anticipated
timing
of
principal
repayments,
underlying
collateral,
and
other
unique
security
features
in
order
to
estimate
the
relevant
cash
flows,
which
are
then
discounted
to
calculate
the
fair
value.
Investments
in open-end mutual
funds
are
valued
at
the
closing
NAV.
Investments
in
repurchase
agreements
are
valued
at
cost,
which
approximates
fair
value.
The
Fund
has
procedures
to
determine
the
fair
value
of
financial
instruments
for
which
market
prices
are
not
reliable
or
readily
available.
Under
these
procedures,
the Fund
primarily
employs
a
market-based
approach
which
may
use
related
or
comparable
assets
or
liabilities,
recent
transactions,
market
multiples,
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
Fund's
business
day.
Events
can occur
between
the
time
at
which
trading
in
a
foreign
security
is
completed
and
4
p.m.
Eastern
time
that
might
call
into
question
the
reliability
of
the
value
of
a
portfolio
security
held
by
the
Fund.
As
a
result,
differences
may
arise
between
the
value
of
the
Fund's
portfolio
securities
as
determined
at
the
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
23
franklintempleton.com
Semiannual
Report
foreign
market
close
and
the
latest
indications
of
value
at
4
p.m.
Eastern
time.
In
order
to
minimize
the
potential
for
these
differences,
an
independent
pricing
service
may
be
used
to
adjust
the
value
of
the
Fund's
portfolio
securities
to
the
latest
indications
of
fair
value
at 4
p.m.
Eastern
time.
At January
31,
2021,
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
Fund's
NAV
is
not
calculated,
which
could
result
in
differences
between
the
value
of
the
Fund's
portfolio
securities
on
the
last
business
day
and
the
last
calendar
day
of
the
reporting
period.
Any
security
valuation
changes
due
to
an
open
foreign
market
are
adjusted
and
reflected
by
the Fund
for
financial
reporting
purposes.
b.
Foreign
Currency
Translation
Portfolio
securities
and
other
assets
and
liabilities
denominated
in
foreign
currencies
are
translated
into
U.S.
dollars
based
on
the
exchange
rate
of
such
currencies
against
U.S.
dollars
on
the
date
of
valuation.
The
Fund
may
enter
into
foreign
currency
exchange
contracts
to
facilitate
transactions
denominated
in
a
foreign
currency.
Purchases
and
sales
of
securities,
income
and
expense
items
denominated
in
foreign
currencies
are
translated
into
U.S.
dollars
at
the
exchange
rate
in
effect
on
the
transaction
date.
Portfolio
securities
and
assets
and
liabilities
denominated
in
foreign
currencies
contain
risks
that
those
currencies
will
decline
in
value
relative
to
the
U.S.
dollar.
Occasionally,
events
may
impact
the
availability
or
reliability
of
foreign
exchange
rates
used
to
convert
the
U.S.
dollar
equivalent
value.
If
such
an
event
occurs,
the
foreign
exchange
rate
will
be
valued
at
fair
value
using
procedures
established
and
approved
by
the
Board.
The
Fund
does
not
separately
report
the
effect
of
changes
in
foreign
exchange
rates
from
changes
in
market
prices
on
securities
held.
Such
changes
are
included
in
net
realized
and
unrealized
gain
or
loss
from
investments
in
the
Statement of
Operations.
Realized
foreign
exchange
gains
or
losses
arise
from
sales
of
foreign
currencies,
currency
gains
or
losses
realized
between
the
trade
and
settlement
dates
on
securities
transactions
and
the
difference
between
the
recorded
amounts
of
dividends,
interest,
and
foreign
withholding
taxes
and
the
U.S.
dollar
equivalent
of
the
amounts
actually
received
or
paid.
Net
unrealized
foreign
exchange
gains
and
losses
arise
from
changes
in
foreign
exchange
rates
on
foreign
denominated
assets
and
liabilities
other
than
investments
in
securities
held
at
the
end
of
the
reporting
period.
c.
Joint
Repurchase
Agreement
The
Fund
enters
into
a
joint
repurchase
agreement
whereby
its
uninvested
cash
balance
is
deposited
into
a
joint
cash
account
with
other
funds
managed
by
the
investment
manager
or
an
affiliate
of
the
investment
manager
and
is
used
to
invest
in
one
or
more
repurchase
agreements.
The
value
and
face
amount
of
the
joint
repurchase
agreement
are
allocated
to
the
funds
based
on
their
pro-rata
interest.
A
repurchase
agreement
is
accounted
for
as
a
loan
by
the
Fund
to
the
seller,
collateralized
by
securities
which
are
delivered
to
the
Fund's
custodian.
The
fair
value,
including
accrued
interest,
of
the
initial
collateralization
is
required
to
be
at
least
102%
of
the
dollar
amount
invested
by
the
funds,
with
the
value
of
the
underlying
securities
marked
to
market
daily
to
maintain
coverage
of
at
least
100%.
Repurchase
agreements
are
subject
to
the
terms
of
Master
Repurchase
Agreements
(MRAs)
with
approved
counterparties
(sellers).
The
MRAs
contain
various
provisions,
including
but
not
limited
to
events
of
default
and
maintenance
of
collateral
for
repurchase
agreements.
In
the
event
of
default
by
either
the
seller
or
the
Fund,
certain
MRAs
may
permit
the
non-
defaulting
party
to
net
and
close-out
all
transactions,
if
any,
traded
under
such
agreements.
The
Fund
may
sell
securities
it
holds
as
collateral
and
apply
the
proceeds
towards
the
repurchase
price
and
any
other
amounts
owed
by
the
seller
to
the
Fund
in
the
event
of
default
by
the
seller.
This
could
involve
costs
or
delays
in
addition
to
a
loss
on
the
securities
if
their
value
falls
below
the
repurchase
price
owed
by
the
seller.
The
joint
repurchase
agreement
held
by
the Fund
at
period
end,
as
indicated
in
the
Statement
of
Investments,
had
been
entered
into
on
January
29,
2021.
1.
Organization
and
Significant
Accounting
Policies
(continued)
a.
Financial
Instrument
Valuation
(continued)
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
24
franklintempleton.com
Semiannual
Report
d.
Securities
Lending
The
Fund
participates
in
an
agency
based
securities
lending
program
to
earn
additional
income.
The
Fund
receives
collateral
in
the
form
of
cash
and/or
U.S.
Government
and
Agency
securities
against
the
loaned
securities
in
an
amount
equal
to
at
least
102%
of
the
fair
value
of
the
loaned
securities.
Collateral
is
maintained
over
the
life
of
the
loan
in
an
amount
not
less
than
100%
of
the
fair
value
of
loaned
securities,
as
determined
at
the
close
of
Fund
business
each
day;
any
additional
collateral
required
due
to
changes
in
security
values
is
delivered
to
the
Fund
on
the
next
business
day.
Any
cash
collateral
received
is
deposited
into
a
joint
cash
account
with
other
funds
and
is
used
to
invest
in
a
money
market
fund
managed
by
Franklin
Advisers,
Inc.,
an
affiliate
of
the Fund,
and/or
a
joint
repurchase
agreement.
The
Fund
may
receive
income
from
the
investment
of
cash
collateral,
in
addition
to
lending
fees
and
rebates
paid
by
the
borrower.
Income
from
securities
loaned,
net
of
fees
paid
to
the
securities
lending
agent
and/or
third-party
vendor,
is
reported
separately
in
the
Statement
of
Operations.
The
Fund
bears
the
market
risk
with
respect
to any
cash collateral
investment,
securities
loaned,
and
the
risk
that
the
agent
may
default
on
its
obligations
to
the
Fund.
If
the
borrower
defaults
on
its
obligation
to
return
the
securities
loaned,
the
Fund
has
the
right
to
repurchase
the
securities
in
the
open
market
using
the
collateral
received.
The
securities
lending
agent
has
agreed
to
indemnify
the
Fund
in
the
event
of
default
by
a
third
party
borrower.
e.
Income
and
Deferred
Taxes
It
is the
Fund's
policy
to
qualify
as
a
regulated
investment
company
under
the
Internal
Revenue
Code. The
Fund
intends
to
distribute
to
shareholders
substantially
all
of
its
taxable
income
and
net
realized
gains
to
relieve
it
from
federal
income
and excise
taxes.
As
a
result,
no
provision
for
U.S.
federal
income
taxes
is
required.
The Fund
may
be
subject
to
foreign
taxation
related
to
income
received,
capital
gains
on
the
sale
of
securities
and
certain
foreign
currency
transactions
in
the
foreign
jurisdictions
in
which
it
invests.
Foreign
taxes,
if
any,
are
recorded
based
on
the
tax
regulations
and
rates
that
exist
in
the
foreign
markets
in
which
the
Fund
invests.
When
a
capital
gain
tax
is
determined
to
apply,
the
Fund
records
an
estimated
deferred
tax
liability
in
an
amount
that
would
be
payable
if
the
securities
were
disposed
of
on
the
valuation
date.
The
Fund
may
recognize
an
income
tax
liability
related
to
its
uncertain
tax
positions
under
U.S.
GAAP
when
the
uncertain
tax
position
has
a
less
than
50%
probability
that
it
will
be
sustained
upon
examination
by
the
tax
authorities
based
on
its
technical
merits.
As
of
January
31,
2021,
the
Fund
has
determined
that
no
tax
liability
is
required
in
its
financial
statements
related
to
uncertain
tax
positions
for
any
open
tax
years
(or
expected
to
be
taken
in
future
tax
years).
Open
tax
years
are
those
that
remain
subject
to
examination
and
are
based
on
the
statute
of
limitations
in
each
jurisdiction
in
which
the
Fund
invests.
f.
Security
Transactions,
Investment
Income,
Expenses
and
Distributions
Security
transactions
are
accounted
for
on
trade
date.
Realized
gains
and
losses
on
security
transactions
are
determined
on
a
specific
identification
basis.
Interest
income
and
estimated
expenses
are
accrued
daily.
Dividend
income
is
recorded
on
the
ex-dividend
date
except
for
certain
dividends
from
securities
where
the
dividend
rate
is
not
available.
In
such
cases,
the
dividend
is
recorded
as
soon
as
the
information
is
received
by
the
Fund.
Distributions
to
shareholders
are
recorded
on
the
ex-dividend
date.
Distributable
earnings
are
determined
according
to
income
tax
regulations
(tax
basis)
and
may
differ
from
earnings
recorded
in
accordance
with
U.S.
GAAP.
These
differences
may
be
permanent
or
temporary.
Permanent
differences
are
reclassified
among
capital
accounts
to
reflect
their
tax
character.
These
reclassifications
have
no
impact
on
net
assets
or
the
results
of
operations.
Temporary
differences
are
not
reclassified,
as
they
may
reverse
in
subsequent
periods.
Realized
and
unrealized
gains
and
losses
and
net
investment
income,
excluding
class
specific
expenses,
are
allocated
daily
to
each
class
of
shares
based
upon
the
relative
proportion
of
net
assets
of
each
class.
Differences
in
per
share
distributions
by
class
are
generally
due
to
differences
in
class
specific
expenses.
g.
Accounting
Estimates
The
preparation
of
financial
statements
in
accordance
with
U.S.
GAAP
requires
management
to
make
estimates
and
assumptions
that
affect
the
reported
amounts
of
assets
1.
Organization
and
Significant
Accounting
Policies
(continued)
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
25
franklintempleton.com
Semiannual
Report
and
liabilities
at
the
date
of
the
financial
statements
and
the
amounts
of
income
and
expenses
during
the
reporting
period.
Actual
results
could
differ
from
those
estimates.
h.
Guarantees
and
Indemnifications
Under
the
Fund's
organizational
documents,
its
officers
and
trustees
are
indemnified
by
the
Fund
against
certain
liabilities
arising
out
of
the
performance
of
their
duties
to
the
Fund.
Additionally,
in
the
normal
course
of
business,
the
Fund
enters
into
contracts
with
service
providers
that
contain
general
indemnification
clauses.
The
Fund's
maximum
exposure
under
these
arrangements
is
unknown
as
this
would
involve
future
claims
that
may
be
made
against
the
Fund
that
have
not
yet
occurred.
Currently,
the
Fund
expects
the
risk
of
loss
to
be
remote.
2.
Shares
of
Beneficial
Interest
At
January
31,
2021,
there
were
an
unlimited
number
of
shares
authorized
(without
par
value).
Transactions
in
the
Fund’s
shares
were
as
follows:
Six
Months
Ended
January
31,
2021
Year
Ended
July
31,
2020
Shares
Amount
Shares
Amount
Class
A
Shares:
Shares
sold
a
...................................
20,060,474
$522,587,532
38,055,516
$722,901,303
Shares
issued
in
reinvestment
of
distributions
..........
3,140,730
73,775,753
—
—
Shares
redeemed
...............................
(17,356,842)
(458,518,256)
(43,260,928)
(846,991,852)
Net
increase
(decrease)
..........................
5,844,362
$137,845,029
(5,205,412)
$(124,090,549)
Class
C
Shares:
Shares
sold
...................................
707,370
$16,889,936
1,573,374
$27,069,763
Shares
issued
in
reinvestment
of
distributions
..........
480,212
10,156,494
—
—
Shares
redeemed
a
..............................
(942,831)
(22,185,413)
(2,323,343)
(40,538,020)
Net
increase
(decrease)
..........................
244,751
$4,861,017
(749,969)
$(13,468,257)
Class
R6
Shares:
Shares
sold
...................................
361,136
$10,275,755
766,821
$15,343,211
Shares
issued
in
reinvestment
of
distributions
..........
72,633
1,849,233
—
—
Shares
redeemed
...............................
(346,548)
(9,713,166)
(689,324)
(13,960,565)
Net
increase
(decrease)
..........................
87,221
$2,411,822
77,497
$1,382,646
Advisor
Class
Shares:
Shares
sold
...................................
2,480,982
$69,540,788
5,387,923
$111,957,923
Shares
issued
in
reinvestment
of
distributions
..........
903,757
22,747,555
—
—
Shares
redeemed
...............................
(2,206,440)
(60,478,249)
(4,103,708)
(80,008,392)
Net
increase
(decrease)
..........................
1,178,299
$31,810,094
1,284,215
$31,949,531
a
May
include
a
portion
of
Class
C
shares
that
were
automatically
converted
to
Class
A.
1.
Organization
and
Significant
Accounting
Policies
(continued)
g.
Accounting
Estimates
(continued)
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
26
franklintempleton.com
Semiannual
Report
3.
Transactions
with
Affiliates
Franklin
Resources,
Inc.
is
the
holding
company
for
various
subsidiaries
that
together
are
referred
to
as
Franklin
Templeton.
Certain
officers
and
trustees
of
the
Fund
are
also
officers
and/or
directors
of
the
following
subsidiaries:
a.
Management
Fees
The
Fund
pays
an
investment
management
fee
to
Advisers
based
on
the
month-end
net
assets
of
the
Fund
as
follows:
For
the
period
ended
January
31,
2021,
the
annualized
gross
effective
investment
management
fee
rate
was
0.463%
of
the
Fund’s
average
daily
net
assets.
b.
Administrative
Fees
Under
an
agreement
with
Advisers,
FT
Services
provides
administrative
services
to
the
Fund.
The
fee
is
paid
by
Advisers
based
on
the
Fund's
average
daily
net
assets,
and
is
not
an
additional
expense
of
the
Fund.
c.
Distribution
Fees
The
Board
has
adopted
distribution
plans
for
Class
A
and
Class
C
shares,
pursuant
to
Rule
12b-1
under
the
1940
Act.
Under
the
Fund’s
Class
A
reimbursement
distribution
plan,
the
Fund
reimburses
Distributors
for
costs
incurred
in
connection
with
the
servicing,
sale
and
distribution
of
the
Fund's
shares
up
to
the
maximum
annual
plan
rate.
Under
the
Class
A
reimbursement
distribution
plan,
costs
exceeding
the
maximum
for
the
current
plan
year
cannot
be
reimbursed
in
subsequent
periods.
In
addition,
under
the
Fund’s
Class
C
compensation
distribution
plan,
the
Fund
pays
Distributors
for
costs
incurred
in
connection
with
the
servicing,
sale
and
distribution
of
the
Fund's
shares
up
to
the
maximum
annual
plan
rate.
The
plan
year,
for
purposes
of
monitoring
compliance
with
the
maximum
annual
plan
rates,
is
February
1
through
January
31.
The
maximum
annual
plan
rates,
based
on
the
average
daily
net
assets,
for
each
class,
are
as
follows:
Subsidiary
Affiliation
Franklin
Advisers,
Inc.
(Advisers)
Investment
manager
Franklin
Templeton
Services,
LLC
(FT
Services)
Administrative
manager
Franklin
Templeton
Distributors,
Inc.
(Distributors)
Principal
underwriter
Franklin
Templeton
Investor
Services,
LLC
(Investor
Services)
Transfer
agent
Annualized
Fee
Rate
Net
Assets
0.625%
Up
to
and
including
$100
million
0.500%
Over
$100
million,
up
to
and
including
$250
million
0.450%
Over
$250
million,
up
to
and
including
$7.5
billion
0.440%
Over
$7.5
billion,
up
to
and
including
$10
billion
0.430%
Over
$10
billion,
up
to
and
including
$12.5
billion
0.420%
Over
$12.5
billion,
up
to
and
including
$15
billion
0.400%
In
excess
of
$15
billion
Class
A
....................................................................................
0.25%
Class
C
....................................................................................
1.00%
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
27
franklintempleton.com
Semiannual
Report
d.
Sales
Charges/Underwriting
Agreements
Front-end
sales
charges
and
contingent
deferred
sales
charges
(CDSC)
do
not
represent
expenses
of
the
Fund.
These
charges
are
deducted
from
the
proceeds
of
sales
of
fund
shares
prior
to
investment
or
from
redemption
proceeds
prior
to
remittance,
as
applicable.
Distributors
has
advised
the
Fund
of
the
following
commission
transactions
related
to
the
sales
and
redemptions
of
the
Fund's
shares
for
the
period:
e.
Transfer
Agent
Fees
Each
class
of
shares
pays
transfer
agent
fees
to
Investor
Services
for
its
performance
of
shareholder
servicing
obligations.
The
fees
are
based
on
an
annualized
asset
based
fee
of
0.02%
plus
a
transaction
based
fee.
In
addition,
each
class
reimburses
Investor
Services
for
out
of
pocket
expenses
incurred
and,
except
for
Class
R6,
reimburses
shareholder
servicing
fees
paid
to
third
parties.
These
fees
are
allocated
daily
based
upon
their
relative
proportion
of
such
classes'
aggregate
net
assets.
Class
R6
pays
Investor
Services
transfer
agent
fees
specific
to
that
class.
For
the
period
ended
January
31,
2021,
the
Fund
paid
transfer
agent
fees
of
$838,251,
of
which
$409,236
was
retained
by
Investor
Services.
f.
Investments
in
Affiliated
Management
Investment
Companies
The
Fund
invests
in
one
or
more
affiliated
management
investment
companies
for
purposes
other
than
exercising
a
controlling
influence
over
the
management
or
policies.
Management
fees
paid
by
the
Fund
are
waived
on
assets
invested
in
the
affiliated
management
investment
companies,
as
noted
in
the
Statement
of
Operations,
in
an
amount
not
to
exceed
the
management
and
administrative
fees
paid
directly
or
indirectly
by
each
affiliate.
During
the
period
ended
January
31,
2021,
the
Fund
held
investments
in
affiliated
management
investment
companies
as
follows:
g.
Waiver
and
Expense
Reimbursements
Investor
Services
has
contractually
agreed
in
advance
to
waive
or
limit
its
fees
so
that
the
Class
R6
transfer
agent
fees
do
not
exceed
0.03%
based
on
the
average
net
assets
of
the
class
until
November
30,
2021
.
Sales
charges
retained
net
of
commissions
paid
to
unaffiliated
brokers/dealers
..............................
$72,416
CDSC
retained
..............................................................................
$9,238
aa
Value
at
Beginning
of
Period
Purchases
Sales
Realized
Gain
(Loss)
Net
Change
in
Unrealized
Appreciation
(Depreciation)
Value
at
End
of
Period
Number
of
Shares
Held
at
End
of
Period
Investment
Income
a
a
a
a
a
a
a
a
Franklin
Gold
and
Precious
Metals
Fund
Non-Controlled
Affiliates
Dividends
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
0%
.........
$11,151,454
$206,597,533
$(178,658,170)
$—
$—
$39,090,817
39,090,817
$—
Non-Controlled
Affiliates
Income
from
securities
loaned
Institutional
Fiduciary
Trust
-
Money
Market
Portfolio,
0%
.........
$4,254,000
$66,386,000
$(65,701,000)
$
—
$
—
$4,939,000
4,939,000
$—
Total
Affiliated
Securities
....
$15,405,454
$272,983,533
$(244,359,170)
$—
$—
$44,029,817
$—
3.
Transactions
with
Affiliates
(continued)
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
28
franklintempleton.com
Semiannual
Report
4.
Expense
Offset
Arrangement
The
Fund has
entered
into
an
arrangement
with
its
custodian
whereby
credits
realized
as
a
result
of
uninvested
cash
balances
are
used
to
reduce
a
portion
of
the
Fund’s
custodian
expenses.
During
the
period
ended
January
31,
2021,
the
custodian
fees
were
reduced
as
noted
in
the
Statement
of
Operations.
5.
Income
Taxes
For
tax
purposes,
capital
losses
may
be
carried
over
to
offset
future
capital
gains.
At
July
31,
2020,
the
capital
loss
carryforwards
were
as
follows:
At
January
31,
2021,
the
cost
of
investments
and
net
unrealized
appreciation
(depreciation)
for
income
tax
purposes
were
as
follows:
Differences
between
income
and/or
capital
gains
as
determined
on
a
book
basis
and
a
tax
basis
are
primarily
due
to
differing
treatments
of
wash
sales,
passive
foreign
investment
company
shares,
and
corporate
actions.
6.
Investment
Transactions
Purchases
and
sales
of
investments
(excluding
short
term
securities)
for
the
period
ended
January
31,
2021,
aggregated
$139,066,498
and
$122,860,019,
respectively.
At
January
31,
2021,
in
connection
with
securities
lending
transactions,
the
Fund
loaned
equity
investments
and
received
$6,248,500
of
cash
collateral.
The
gross
amount
of
recognized
liability
for
such
transactions
is
included
in
payable
upon
return
of
securities
loaned
in
the
Statement
of
Assets
and
Liabilities.
The
agreements
can
be
terminated
at
any
time.
7.
Concentration
of
Risk
Investing
in
foreign
securities
may
include
certain
risks
and
considerations
not
typically
associated
with
investing
in
U.S.
securities,
such
as
fluctuating
currency
values
and
changing
local,
regional
and
global
economic,
political
and
social
conditions,
which
may
result
in
greater
market
volatility.
Current
political
and
financial
uncertainty
surrounding
the
European
Union
may
increase
market
volatility
and
the
economic
risk
of
investing
in
securities
in
Europe.
In
addition,
certain
foreign
securities
may
not
be
as
liquid
as
U.S.
securities.
Capital
loss
carryforwards
not
subject
to
expiration:
Short
term
................................................................................
$3,730,680
Long
term
................................................................................
668,744,010
Total
capital
loss
carryforwards
...............................................................
$672,474,690
Cost
of
investments
..........................................................................
$1,079,424,533
Unrealized
appreciation
........................................................................
$539,009,124
Unrealized
depreciation
........................................................................
(324,079,324)
Net
unrealized
appreciation
(depreciation)
..........................................................
$214,929,800
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
29
franklintempleton.com
Semiannual
Report
8. 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 Fund, its ability
to
buy
and
sell
fund
investments
at
appropriate
valuations
and its ability
to
achieve its investment
objectives.
9.
Restricted
Securities
The
Fund
invests
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 Fund
may
have
registration
rights
for
restricted
securities.
The
issuer
generally
incurs
all
registration
costs.
At
January
31,
2021,
investments
in
restricted
securities,
excluding
securities
exempt
from
registration
under
the
1933
Act,
were
as
follows:
Shares
/
Warrants
Issuer
Acquisition
Date
Cost
Value
Franklin
Gold
And
Precious
Metals
Fund
550,000
a
Bluestone
Resources,
Inc.,
3/19/21
..............
2/20/19
$
76,682
$
102,503
1,900,000
b
Clean
Air
Metals,
Inc.,
2/11/22
..................
2/04/20
—
197,201
5,000,000
c
Euro
Sun
Mining,
Inc.,
6/05/23
..................
6/09/20
—
109,060
8,250,000
G
Mining
Ventures
Corp.,
144A
.................
11/17/20
3,149,937
8,246,303
4,125,000
G
Mining
Ventures
Corp.,
144A,
5/19/22
...........
11/27/20
—
2,207,064
6,375,000
Lydian
International
Ltd
.......................
11/24/17
2,098,016
—
25,250,000
Lydian
International
Ltd.,
144A
..................
3/06/12
14,750,154
—
1,153,000
d
Marathon
Gold
Corp.,
5/26/21
..................
5/27/20
—
798,097
3,850,000
e
Mawson
Gold
Ltd.,
8/13/20
.....................
5/22/20
—
133,360
850,000
f
O3
Mining,
Inc.,
6/18/22
.......................
6/23/20
—
310,812
460,000
g
Orla
Mining
Ltd.,
2/15/21
......................
2/12/18
95,417
1,140,377
460,000
h
Osisko
Development
Corp.,
144A
................
12/21/20
2,684,303
2,705,403
737,500
i
Osisko
Development
Corp.,
144A,
12/01/23
........
11/27/20-12/31/20
—
476,041
2,125,000
j
Osisko
Mining,
Inc.,
12/23/21
...................
6/24/20
—
509,619
1,700,000
Probe
Metals,
Inc
,
144A,
11/24/22
...............
11/23/20-11/24/20
—
261,929
3,400,000
Probe
Metals,
Inc.,
144A
......................
11/23/20-11/24/20
4,177,562
4,029,257
400,000
k
Skeena
Resources
Ltd
........................
12/18/20
782,442
908,103
5,650,000
l
Talisker
Resources
Ltd.,
144A,
8/31/21
............
8/17/20
—
694
6,900,000
Troilus
Gold
Corp.,
144A
......................
11/24/20
5,838,012
5,337,444
3,350,000
m
Vizsla
Resources
Corp.,
144A,
7/30/22
............
7/23/20
—
773,198
Total
Restricted
Securities
(Value
is
2.18%
of
Net
Assets)
.............
$33,652,525
$28,246,465
a
The
Fund
also
invests
in
unrestricted
securities
of
the
issuer,
valued
at
$9,454,915
as
of
January
31,
2021.
b
The
Fund
also
invests
in
unrestricted
securities
of
the
issuer,
valued
at
$1,188,707
as
of
January
31,
2021.
c
The
Fund
also
invests
in
unrestricted
securities
of
the
issuer,
valued
at
$2,502,542
as
of
January
31,
2021.
d
The
Fund
also
invests
in
unrestricted
securities
of
the
issuer,
valued
at
$5,085,571
as
of
January
31,
2021.
e
The
Fund
also
invests
in
unrestricted
securities
of
the
issuer,
valued
at
$1,926,957
as
of
January
31,
2021.
f
The
Fund
also
invests
in
unrestricted
securities
of
the
issuer,
valued
at
$4,398,217
as
of
January
31,
2021.
g
The
Fund
also
invests
in
unrestricted
securities
of
the
issuer,
valued
at
$23,702,773
as
of
January
31,
2021.
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
30
franklintempleton.com
Semiannual
Report
10.
Holdings
of
5%
Voting
Securities
of
Portfolio
Companies
The
1940
Act
defines
"affiliated
companies"
to
include
investments
in
portfolio
companies
in
which
a
fund
owns
5%
or
more
of
the
outstanding
vo
ting
securities.
During
the
period
ended
January
31,
2021
,
investments
in
“affiliated
companies”
were
as
follows:
h
The
Fund
also
invests
in
unrestricted
securities
of
the
issuer,
valued
at
$21,320,990
as
of
January
31,
2021.
i
The
Fund
also
invests
in
unrestricted
securities
of
the
issuer,
valued
at
$17,389,927
as
of
January
31,
2021.
j
The
Fund
also
invests
in
unrestricted
securities
of
the
issuer,
valued
at
$3,589,583
as
of
January
31,
2021.
k
The
Fund
also
invests
in
unrestricted
securities
of
the
issuer,
valued
at
$4,086,963
as
of
January
31,
2021.
Value
at
Beginning
of
Period
Purchases
a
Sales
a
Realized
Gain
(Loss)
Net
Change
in
Unrealized
Appreciation
(Depreciation)
Value
at
End
of
Period
Number
of
Shares/Principal
Amount
*
Held
at
End
of
Period
Investment
Income
Franklin
Gold
And
Precious
Metals
Fund
Non-Controlled
Affiliates
Dividends
Ascot
Resources
Ltd.,
144A
..
$
13,441,989
$
—
$
—
$
—
$
1,652,873
$
15,094,862
16,220,000
$
—
Battle
North
Gold
Corp.,
144A
11,899,142
2,240,133
—
—
(1,063,897)
13,075,378
9,608,900
—
Benchmark
Metals,
Inc
.....
—
6,561,194
—
—
(579,937)
5,981,257
6,890,300
—
Chalice
Mining
Ltd
........
21,059,387
—
(31,264,421)
25,412,084
—
b
—
b
—
b
—
Dacian
Gold
Ltd
..........
7,673,415
—
—
—
4,186,085
11,859,500
32,555,556
—
Euro
Sun
Mining,
Inc.,
144A
.
4,106,316
—
—
—
(1,603,774)
2,502,542
10,000,000
—
Euro
Sun
Mining,
Inc.,
6/05/23
888,663
—
—
—
(779,603)
109,060
5,000,000
—
G
Mining
Ventures
Corp.,
144A
—
3,149,937
—
—
5,096,366
8,246,303
8,250,000
—
G
Mining
Ventures
Corp.,
144A,
5/19/22
..............
—
—
—
—
2,207,064
2,207,064
4,125,000
—
Geopacific
Resources
Ltd
...
5,744,253
1,024,735
—
—
(1,488,419)
5,280,569
16,223,922
—
HighGold
Mining,
Inc.
......
6,523,515
—
—
—
(1,677,718)
4,845,797
4,303,000
—
Lion
One
Metals
Ltd.
......
9,080,715
—
(729,561)
417,170
(3,319,594)
5,448,730
4,614,100
—
Lion
One
Metals
Ltd.,
144A
..
5,237,158
1,076,702
—
—
(1,561,971)
4,751,889
4,024,000
—
Lion
One
Metals
Ltd.,
6/06/21
922,513
—
(86,777)
620
(836,356)
—
—
—
Platinum
Group
Metals
Ltd.,
(CAD
Traded)
.........
4,894,438
—
(939,700)
(17,881,651)
21,632,690
7,705,777
2,052,787
—
Platinum
Group
Metals
Ltd.,
(CAD
Traded),
144A
.....
212,395
—
—
—
154,578
366,973
97,760
—
Platinum
Group
Metals
Ltd.,
(USD
Traded)
.........
10,296,035
—
(1,786,546)
(18,752,764)
26,022,979
15,779,704
4,241,856
—
Platinum
Group
Metals
Ltd.,
(USD
Traded),
144A
.....
79,579
—
—
—
57,916
137,495
36,628
—
Red
5
Ltd
..............
29,322,847
—
—
—
(2,992,426)
26,330,421
162,268,146
—
RTG
Mining,
Inc
.........
171,785
—
—
—
91,204
262,989
1,769,918
—
RTG
Mining,
Inc.,
144A
.....
232,726
—
—
—
123,558
356,284
2,397,790
—
RTG
Mining,
Inc.,
CDI
......
4,527,352
—
—
—
2,445,029
6,972,381
50,687,582
—
Saturn
Metals
Ltd
........
—
3,132,576
—
—
(1,102,738)
2,029,838
6,200,000
—
9.
Restricted
Securities
(continued)
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
31
franklintempleton.com
Semiannual
Report
11.
Credit
Facility
The
Fund,
together
with
other
U.S.
registered
and
foreign
investment
funds
(collectively,
Borrowers),
managed
by
Franklin
Templeton,
are
borrowers
in
a
joint
syndicated
senior
unsecured
credit
facility
totaling
$2
billion
(Global
Credit
Facility)
which
matured
on
February
5,
2021.
This
Global
Credit
Facility
provides
a
source
of
funds
to
the
Borrowers
for
temporary
and
emergency
purposes,
including
the
ability
to
meet
future
unanticipated
or
unusually
large
redemption
requests.
Effective
February
5,
2021,
the
Borrowers
renewed
the
Global
Credit
Facility
for
a
one
year
term,
maturing
February
4,
2022,
for
a
total
of
$2.675
billion.
Under
the
terms
of
the
Global
Credit
Facility,
the
Fund
shall,
in
addition
to
interest
charged
on
any
borrowings
made
by
the
Fund
and
other
costs
incurred
by
the
Fund,
pay
its
share
of
fees
and
expenses
incurred
in
connection
with
the
implementation
and
maintenance
of
the
Global
Credit
Facility,
based
upon
its
relative
share
of
the
aggregate
net
assets
of
all
of
the
Borrowers,
including
an
annual
commitment
fee
of
0.15%
based
upon
the
unused
portion
of
the
Global
Credit
Facility.
These
fees
are
reflected
in
other
expenses
in
the
Statement
of
Operations.
During
the
period
ended
January
31,
2021,
the Fund
did
not
use
the
Global
Credit
Facility.
12.
Fair
Value
Measurements
The
Fund
follows
a
fair
value
hierarchy
that
distinguishes
between
market
data
obtained
from
independent
sources
(observable
inputs)
and
the Fund's
own
market
assumptions
(unobservable
inputs).
These
inputs
are
used
in
determining
the
value
of
the
Fund’s
financial
instruments
and
are
summarized
in
the
following
fair
value
hierarchy:
Level
1
–
quoted
prices
in
active
markets
for
identical
financial
instruments
Level
2
–
other
significant
observable
inputs
(including
quoted
prices
for
similar
financial
instruments,
interest
rates,
prepayment
speed,
credit
risk,
etc.)
Value
at
Beginning
of
Period
Purchases
Sales
Realized
Gain
(Loss)
Net
Change
in
Unrealized
Appreciation
(Depreciation)
Value
at
End
of
Period
Number
of
Shares/Principal
Amount
*
Held
at
End
of
Period
Investment
Income
Franklin
Gold
And
Precious
Metals
Fund
(continued)
Non-Controlled
Affiliates
Superior
Gold,
Inc.,
144A
...
$
—
$
2,837,874
$
—
$
—
$
216,400
$
3,054,274
5,350,000
$
—
Talisker
Resources
Ltd
.....
—
5,109,466
—
—
(1,519,883)
3,589,583
15,300,000
—
Talisker
Resources
Ltd.,
144A,
8/31/21
..............
—
—
—
—
694
694
5,650,000
—
Troilus
Gold
Corp.,
144A
....
—
5,838,012
—
—
(500,568)
5,337,444
6,900,000
—
Interest
Platinum
Group
Metals
Ltd.,
Sub.
Note,
6.875%,
7/01/22
2,257,500
—
—
—
607,500
2,865,000
3,000,000
103,125
Total
Affiliated
Securities
(Value
is
11.9%
of
Net
Assets)
..............
$138,571,723
$30,970,629
$(34,807,005)
(10,804,541)
45,468,052
$154,191,808
$103,125
*
In
U.S.
dollars
unless
otherwise
indicated.
a
May
include
accretion,
amortization,
partnership
adjustments,
and/or
corporate
actions.
b
As
of
January
31,
2021,
no
longer
an
affiliate.
10.
Holdings
of
5%
Voting
Securities
of
Portfolio
Companies
(continued)
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
32
franklintempleton.com
Semiannual
Report
Level
3
–
significant
unobservable
inputs
(including
the
Fund’s
own
assumptions
in
determining
the
fair
value
of
financial
instruments)
The
input
levels
are
not
necessarily
an
indication
of
the
risk
or
liquidity
associated
with
financial
instruments
at
that
level.
A
summary
of
inputs
used
as
of
January
31,
2021,
in
valuing
the
Fund’s
assets
carried
at
fair
value,
is
as
follows:
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
January
31,
2021,
the
reconciliation
of
assets,
is
as
follows:
Level
1
Level
2
Level
3
Total
Franklin
Gold
and
Precious
Metals
Fund
Assets:
Investments
in
Securities:
a
Common
Stocks
:
Copper
..............................
$
6,695,720
$
—
$
—
$
6,695,720
Diversified
Metals
&
Mining
...............
93,576,354
5,280,569
16,289,150
115,146,073
Environmental
&
Facilities
Services
.........
—
2,741,404
—
2,741,404
Gold
................................
692,929,233
253,137,215
4,937,360
b
951,003,808
Precious
Metals
&
Minerals
...............
88,629,544
58,076,415
—
146,705,959
Silver
...............................
4,691,889
10,646,780
—
15,338,669
Rights
................................
1,424,962
—
—
1,424,962
Warrants
..............................
—
—
7,093,421
7,093,421
Convertible
Bonds
.......................
—
2,865,000
—
2,865,000
Short
Term
Investments
...................
44,029,817
1,309,500
—
45,339,317
Total
Investments
in
Securities
...........
$931,977,519
$334,056,883
$28,319,931
$1,294,354,333
a
For
detailed
categories,
see
the
accompanying
Statement
of
Investments.
b
Includes
securities
determined
to
have
no
value
at
January
31,
2021.
Balance
at
Beginning
of
Period
Purchases
Sales
Transfer
Into
Level
3
a
Transfer
Out
of
Level
3
b
Cost
Basis
Adjust-
ments
Net
Realized
Gain
(Loss)
Net
Unr
ealized
Appreciatio
n
(
Depreciation
)
Balance
at
End
of
Period
Net
Change
in
Unrealized
Appreciation
(Depreciation)
on
Assets
Held
at
Period
End
a
a
a
a
a
a
a
a
a
a
a
Franklin
Gold
and
Precious
Metals
Fund
Assets:
Investments
in
Securities:
Common
Stocks
Diversified
Metals
&
Mining
.........
$
20,121,498
$
11,634,038
$
—
$
5,828,590
$
(15,620,911)
$
—
$
—
$
(5,674,065)
$
16,289,150
$
(
1,173,478
)
Gold
............
16,111,904
c
4,960,004
—
—
(20,528,411)
—
—
4,393,863
4,937,36
0
c
(22,646)
Warrants
Diversified
Metals
&
Mining
.........
2,839,658
—
c
—
—
—
—
—
2,299,840
5,139,498
2,299,840
Gold
............
3,185,251
—
c
(86,834)
—
—
—
623
(1,654,736)
1,444,304
557,648
Precious
Metals
&
Minerals
........
422,912
—
—
—
—
—
—
86,707
509,619
86,707
Total
Investments
in
Securities
.
$42,681,223
$16,594,042
$(86,834)
$5,828,590
$(36,149,322)
$
—
$
623
$
(548,391)
$28,319,931
$
1,748,071
a
Transferred
into
level
3
as
a
result
of
the
unavailability
of
a
quoted
market
price
in
an
active
market
for
identical
securities
and
other
significant
observable
valuation
inputs.
b
Transferred
out
of
Level
3
as
a
result
of
the
availability
of
a
quoted
price
in
an
active
market
for
identical
securities
and
other
significant
observable
valuation
inputs.
May
include
amounts
related
to
a
corporate
action.
12.
Fair
Value
Measurements
(continued)
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
33
franklintempleton.com
Semiannual
Report
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
January
31,
2021,
are
as
follows:
13.
New
Accounting
Pronouncements
In
March
2020,
the
Financial
Accounting
Standards
Board
(FASB)
issued
Accounting
Standards
Update
(ASU)
No.
2020-
04,
Reference
Rate
Reform
(Topic
848)
–
Facilitation
of
the
Effects
of
Reference
Rate
Reform
on
Financial
Reporting.
The
amendments
in
the
ASU
provides
optional
temporary
financial
reporting
relief
from
the
effect
of
certain
types
of
contract
modifications
due
to
the
planned
discontinuation
of
the
London
Interbank
Offered
Rate
(LIBOR)
and
other
interbank-offered
based
reference
rates
as
of
the
end
of
2021.
The
ASU
is
effective
for
certain
reference
rate-related
contract
modifications
that
occur
during
the
period
March
12,
2020
through
December
31,
2022.
Management
has
reviewed
the
requirements
and
believes
the
adoption
of
this
ASU
will
not
have
a
material
impact
on
the
financial
statements.
14.
Subsequent
Events
The
Fund
has
evaluated
subsequent
events
through
the
issuance
of
the
financial
statements
and
determined
that
no
events
have
occurred
that
require
disclosure
other
than
those
already
disclosed
in
the
financial
statements.
c
Includes
securities
determined
to
have
no
value.
Description
Fair
Value
at
End
of
Period
Valuation
Technique
Unobservable
Inputs
Amount
/
Range
(Weighted
Average)
a
Impact
to
Fair
Value
if
Input
Increases
b
Franklin
Gold
and
Precious
Metals
Fund
Assets:
Investments
in
Securities:
Common
Stocks:
Diversified
Metals
&
Mining
....
$16,289,150
Market
comparables
Lockup
Discount
3.7%
-
11.9%
(8.2%)
Decrease
c
Gold
.....................
4,029,257
Market
comparables
Lockup
Discount
4.1%
Decrease
Warrants:
Diversified
Metals
&
Mining
....
2,207,064
Market
comparables
30
Day
Implied
Volatility
135.0%
Increase
c
Discount
for
lack
of
marketability
28.0%
Decrease
c
All
Other
Investments
5,794,460
d,e
Total
.......................
$28,319,931
a
Weighted
based
on
the
relative
fair
value
of
the
financial
instruments.
b
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.
c
Represents
a
significant
impact
to
fair
value
but
not
net
assets.
d
Includes
financial
instruments
with
values
derived
using
private
transaction
prices
or
non-public
third
party
pricing
information
which
is
unobservable.
May
also
include
fair
value
of
immaterial
financial
instruments
developed
using
various
valuation
techniques
and
unobservable
inputs.
e
Includes
securities
determined
to
have
no
value
at
January
31,
2021.
12.
Fair
Value
Measurements
(continued)
Franklin
Gold
and
Precious
Metals
Fund
Notes
to
Financial
Statements
(unaudited)
34
franklintempleton.com
Semiannual
Report
Abbreviations
Currency
CAD
Canadian
Dollar
GBP
British
Pound
USD
United
States
Dollar
Selected
Portfolio
ADR
American
Depositary
Receipt
CDI
CREST
Depository
Interest
CVR
Contingent
Voting
Rights
Franklin
Gold
and
Precious
Metals
Fund
Tax
Information
(unaudited)
35
franklintempleton.com
Semiannual
Report
1.
Qualified
dividends
are
taxed
at
reduced
long
term
capital
gains
tax
rates.
In
determining
the
amount
of
foreign
tax
credit
that
may
be
applied
against
the
U.S.
tax
liability
of
individuals
receiving
foreign
source
qualified
dividends,
adjustments
may
be
required
to
the
foreign
tax
credit
limitation
calculation
to
reflect
the
rate
differential
applicable
to
such
dividend
income.
The
rules
however
permit
certain
individuals
to
elect
not
to
apply
the
rate
differential
adjustments
for
capital
gains
and/or
dividends
for
any
taxable
year.
Please
consult
your
tax
advisor
and
the
instructions
to
Form
1116
for
more
information.
At
July
31,
2020,
more
than
50%
of
the
Fund's
total
assets
were
invested
in
securities
of
foreign
issuers.
In
most
instances,
foreign
taxes
were
withheld
from
income
paid
to
the
Fund
on
these
investments.
As
shown
in
the
table
below,
the
Fund
hereby
reports
to
shareholders
the
foreign
source
income
and
foreign
taxes
paid,
pursuant
to
Section
853
of
the
Internal
Revenue
Code.
This
written
statement
will
allow
shareholders
of
record
on
November
30,
2020,
to
treat
their
proportionate
share
of
foreign
taxes
paid
by
the
Fund
as
having
been
paid
directly
by
them.
The
shareholder
shall
consider
these
amounts
as
foreign
taxes
paid
in
the
tax
year
in
which
they
receive
the
Fund
distribution.
The
following
table
provides
a
detailed
analysis
of
foreign
tax
paid,
foreign
source
income,
and
foreign
source
qualified
dividends
as
reported
by
the
Fund,
to
shareholders
of
record.
Foreign
Tax
Paid
Per
Share
is
the
amount
per
share
available
to
you,
as
a
tax
credit
(assuming
you
held
your
shares
in
the
Fund
for
a
minimum
of
16
days
during
the
31-day
period
beginning
15
days
before
the
ex-dividend
date
of
the
Fund’s
distribution
to
which
the
foreign
taxes
relate),
or,
as
a
tax
deduction.
Foreign
Source
Income
Per
Share
is
the
amount
per
share
of
income
dividends
attributable
to
foreign
securities
held
by
the
Fund,
plus
any
foreign
taxes
withheld
on
these
dividends.
The
amounts
reported
include
foreign
source
qualified
dividends
that
have
not
been
adjusted
for
the
rate
differential
applicable
to
such
dividend
income.
1
Foreign
Source
Qualified
Dividends
Per
Share
is
the
amount
per
share
of
foreign
source
qualified
dividends
plus
any
foreign
taxes
withheld
on
these
dividends.
These
amounts
represent
the
portion
of
the
Foreign
Source
Income
Per
Share
that
were
derived
from
qualified
foreign
securities
held
by
the
Fund.
1
At
the
beginning
of
each
calendar
year,
shareholders
will
receive
Form
1099-DIV
which
will
include
their
share
of
taxes
paid
during
the
prior
calendar
year. Shareholders
are
advised
to
check
with
their
tax
advisors
for
information
on
the
treatment
of
these
amounts
on
their
income
tax
returns.
Foreign
Tax
Paid
Per
Share
Foreign
Source
Income
Per
Share
Foreign
Source
Qualified
Dividends
Per
Share
$0.0116
$0.1242
$0.0896
Franklin
Gold
and
Precious
Metals
Fund
Shareholder
Information
36
franklintempleton.com
Semiannual
Report
Proxy
Voting
Policies
and
Procedures
The
Fund’s
investment
manager
has
established
Proxy
Voting
Policies
and
Procedures
(Policies)
that
the
Fund
uses
to
determine
how
to
vote
proxies
relating
to
portfolio
securities.
Shareholders
may
view
the
Fund’s
complete
Policies
online
at
franklintempleton.com.
Alternatively,
shareholders
may
request
copies
of
the
Policies
free
of
charge
by
calling
the
Proxy
Group
collect
at
(954)
527-
7678
or
by
sending
a
written
request
to:
Franklin
Templeton
Companies,
LLC,
300
S.E.
2nd
Street,
Fort
Lauderdale,
FL
33301,
Attention:
Proxy
Group.
Copies
of
the
Fund’s
proxy
voting
records
are
also
made
available
online
at
franklintempleton.com
and
posted
on
the
U.S.
Securities
and
Exchange
Commission’s
website
at
sec.gov
and
reflect
the
most
recent
12-month
period
ended
June
30.
Quarterly
Statement
of
Investments
The
Fund
files
a
complete
statement
of
investments
with
the
U.S.
Securities
and
Exchange
Commission
for
the
first
and
third
quarters
for
each
fiscal
year
as
an
exhibit
to
its
report
on
Form
N-PORT.
Shareholders
may
view
the
filed
Form
N-PORT
by
visiting
the
Commission’s
website
at
sec.
gov.
The
filed
form
may
also
be
viewed
and
copied
at
the
Commission’s
Public
Reference
Room
in
Washington,
DC.
Information
regarding
the
operations
of
the
Public
Reference
Room
may
be
obtained
by
calling
(800)
SEC-0330.
Householding
of
Reports
and
Prospectuses
You
will
receive,
or
receive
notice
of
the
availability
of,
the
Fund’s
financial
reports
every
six
months.
In
addition,
you
will
receive
an
annual
updated
summary
prospectus
(detail
prospectus
available
upon
request).
To
reduce
Fund
expenses,
we
try
to
identify
related
shareholders
in
a
household
and
send
only
one
copy
of
the
financial
reports
(to
the
extent
received
by
mail)
and
summary
prospectus.
This
process,
called
“householding,”
will
continue
indefinitely
unless
you
instruct
us
otherwise.
If
you
prefer
not
to
have
these
documents
householded,
please
call
us
at
(800)
632-2301.
At
any
time
you
may
view
current
prospectuses/
summary
prospectuses
and
financial
reports
on
our
website.
If
you
choose,
you
may
receive
these
documents
through
electronic
delivery.
132
S
03/21
©
2021
Franklin
Templeton
Investments.
All
rights
reserved.
Authorized
for
distribution
only
when
accompanied
or
preceded
by
a
summary
prospectus
and/or
prospectus.
Investors
should
carefully
consider
a
fund’s
investment
goals,
risks,
charges
and
expenses
before
investing.
A
prospectus
contains
this
and
other
information;
please
read
it
carefully
before
investing.
To
help
ensure
we
provide
you
with
quality
service,
all
calls
to
and
from
our
service
areas
are
monitored
and/or
recorded.
Semiannual
Report
and
Shareholder
Letter
Franklin
Gold
and
Precious
Metals
Fund
Investment
Manager
Distributor
Shareholder
Services
Franklin
Advisers,
Inc.
Franklin
Templeton
Distributors,
Inc.
(800)
DIAL
BEN
®
/
342-5236
franklintempleton.com
(800)
632-2301
Item 2. Code of Ethics.
(a) The Registrant has adopted a code of ethics that applies to its principal executive officers and principal financial and accounting officer.
(c) N/A
(d) N/A
(f) Pursuant to Item 13(a)(1), the Registrant is attaching as an exhibit a copy of its code of ethics that applies to its principal executive officers and principal financial and accounting officer.
Item 3. Audit Committee Financial Expert.
(a)(1) The Registrant has an audit committee financial expert serving on its audit committee.
(2) The audit committee financial expert is Mary C. Choksi and she is "independent" as defined under the relevant Securities and Exchange Commission Rules and Releases.
Item 4. Principal Accountant Fees and Services. N/A
Item 5. Audit Committee
of Listed Registrants. N/A
Item 6. Schedule of Investments. N/A
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. N/A
Item 8. Portfolio Managers of Closed-End Management Investment Companies. N/A
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and
Affiliated Purchasers. N/A
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no changes to the procedures by which shareholders may recommend nominees to the Registrant's Board of Trustees that would require disclosure herein.
Item 11. Controls and Procedures.
(a)
Evaluation of Disclosure Controls and Procedures.
The Registrant maintains disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the Registrant’s filings under the Securities Exchange Act of 1934, as amended, and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission. Such information is accumulated and communicated to the Registrant’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Registrant’s management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.
Within 90 days prior to the filing date of this Shareholder Report on Form N-CSR, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant’s management, including the Registrant’s principal executive officer and the Registrant’s principal financial officer, of the effectiveness of the design and operation of the Registrant’s disclosure controls and procedures. Based on such evaluation, the Registrant’s principal executive officer and principal financial officer concluded that the Registrant’s disclosure controls and procedures are effective.
(b)
Changes in Internal Controls.
There have been no changes in the Registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect the internal control over financial reporting.
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Company N/A
Item 13. Exhibits.
(a) (1) Code of Ethics
(a) (2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Matthew T. Hinkle, Chief Executive Officer - Finance and Administration, and Robert G. Kubilis, Chief Financial Officer and Chief Accounting Officer
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Matthew T. Hinkle, Chief Executive Officer - Finance and Administration, and Robert G. Kubilis, Chief Financial Officer and Chief Accounting Officer
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
FRANKLIN GOLD AND PRECIOUS METALS FUND
By __ S\MATTHEW T. HINKLE______________________
Matthew T. Hinkle
Chief Executive Officer – Finance and Administration
Date
March 26, 2021
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By __ S\MATTHEW T. HINKLE______________________
Matthew T. Hinkle
Chief Executive Officer – Finance and Administration
Date
March 26, 2021
By _ S\ROBERT G. KUBILIS________________________
Robert G. Kubilis
Chief Financial Officer
and Chief Accounting Officer
Date March
26, 2021