Franklin Gold and Precious Metals Fund–Class a June 30, 2021

Sector Franklin Gold and Precious Metals Equity Fund–Class A June 30, 2021

Product Profile

Product Details1 Fund Description

Fund Assets $1,288,398,867.90 The fund seeks capital appreciation by investing at least 80% of its net assets in the securities of companies around the world that mine, process or deal in gold or other precious metals such as Fund Inception Date 05/19/1969 silver, platinum and palladium. The fund has a secondary goal of current income. Number of Issuers 102 Investment Style Sector Performance Data2,3 Benchmark FTSE Gold Mines Index S&P 500 Index Average Annual Total Returns4,5 (%) Lipper Classification Precious Metals Equity Since Inception Funds 3 Mths YTD 1 Yr 3 Yrs 5 Yrs 10 Yrs 20 Yrs (05/19/1969) Morningstar Category™ Equity Precious Metals Class A - With -0.42 -10.84 6.30 21.11 4.59 -4.12 7.96 5.14 Dividend Frequency Annually in December Sales Charges Class A - Without 5.38 -5.66 12.47 23.43 5.77 -3.57 8.27 5.25 CUSIP NASDAQ Symbol Sales Charges Class A 353 535 107 FKRCX FTSE Gold Mines 2.67 -8.82 -11.04 15.89 4.17 -3.74 6.35 - Index Maximum Sales Charges S&P 500 Index 8.55 15.25 40.79 18.67 17.65 14.84 8.61 10.60 Class A 5.50% initial sales charge 60% Total Annual Operating Expenses 40% Class A 0.93% 20% 0% -20% 3 Mths YTD 1 Yr 3 Yrs 5 Yrs 10 Yrs 20 Yrs Since Inception

Class A - With Sales Charges Class A - Without Sales Charges FTSE Gold Mines Index S&P 500 Index

Performance data represents past performance, which does not guarantee future results. Current performance may differ from figures shown. The fund’s investment return and principal value will change with market conditions, and you may have a gain or a loss when you sell your shares. Please call Franklin Templeton at (800) DIAL BEN/(800) 342-5236 or visit franklintempleton.com for the most recent month-end performance.

Calendar Year Returns (% Without Sales Charges) 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 Class A 43.67 51.48 -18.11 -0.12 55.61 -22.41 -10.16 -48.03 -14.78 -24.84 FTSE Gold Mines 24.95 42.68 -10.04 10.23 60.72 -20.47 -14.18 -52.25 -14.01 -15.06 Index S&P 500 Index 18.40 31.49 -4.38 21.83 11.96 1.38 13.69 32.39 16.00 2.11

If the sales charge had been included, the returns would have been lower.

1. All holdings are subject to change. Holdings of the same issuers have been combined. 2. Effective 05/01/1994, the fund implemented a Rule 12b-1 plan, which affects subsequent performance. Class A: Prior to 9/10/18, these shares were offered at a higher initial sales charge of 5.75%; thus actual returns would have differed. Total returns with sales charges have been restated to reflect the current maximum initial sales charge of 5.50%. The fund offers other share classes subject to different fees and expenses, which will affect their performance. Please see the prospectus for details. 3. Source for Index: FactSet. Indexes are unmanaged, and one cannot invest directly in an index. They do not reflect any fees, expenses or sales charges. 4. Periods shorter than one year are shown as cumulative total returns. 5. Since inception return for the benchmark is calculated to the fund inception date.

Not FDIC Insured | May Lose Value | No Bank Guarantee Franklin Gold and Precious Metals Fund–Class A June 30, 2021

Portfolio Manager Insight* Performance Review QUARTERLY KEY PERFORMANCE DRIVERS

Stocks Industries Chalice Mining (Off-Benchmark Exposure) Gold (Stock Selection) HELPED Ivanhoe Mines (Off-Benchmark Exposure) Diversified Metals and Mining (Off-Benchmark Exposure) Perseus Mining (Off-Benchmark Exposure) — Newmont (Significant Underweight) Precious Metals and Minerals (Significant Overweight) HURT Impala Platinum Holdings (Off-Benchmark Exposure) Environmental and Facilities Services (Off-Benchmark Exposure) Anglo American Platinum (Off-Benchmark Exposure) —

• Many of the fund’s small-capitalization gold miners saw leveraged upside to gold’s advance, particularly in April, leading to solid average gains across the industry that outperformed physical gold. Chalice Mining was our strongest absolute and relative performer in the second quarter and the first half of 2021. A powerful rally helped pushed it out of the small-cap category, and by June it was added to Australia’s S&P/ASX 200 Index. Chalice continued to develop its globally significant, high-grade discovery (containing a mixture of platinum group elements, nickel, gold, copper and cobalt) at the Julimar Project in Western Australia, which is emerging as a key resource for green-energy inputs since it is leveraged to large-scale adoption of batteries (requiring nickel/copper/cobalt) and hydrogen fuel cells (requiring platinum group elements and nickel). In particular, Julimar marks the first major discovery of palladium in Australia. Chalice also continued to advance permits into a nearby forestry area to explore targets with similar airborne signatures to Julimar while also advancing its gold exploration and feasibility study efforts in the Bendigo region of Australia. • Several other off-benchmark gold miners underwent big rallies based largely on company-specific progress, including key contributors Perseus Mining, Ascot Resources, Red 5, Marathon Gold and Prime Mining. In particular, Ascot is a Canadian-based exploration and development company that is working to re-start the historic Premier gold mine, located in British Columbia’s Golden Triangle. The company has continued to define high- grade resources for underground mining with the near-term goal of converting the underground resources into reserves, while continuing to explore nearby targets on its Premier/Dilworth and Silver Coin properties (collectively referred to as the Premier Gold Project). Ascot reported an active first quarter of 2021, which included submitting the permit amendment application and completing the basic engineering. During the second quarter, the company raised just over US$80 million, which together with its project financing facilities provides the funding to construct the Premier Gold Project. • Three of the fund’s top-10 individual detractors—Impala Platinum Holdings, Anglo American Platinum and Northam Platinum—are platinum- and palladium-focused producers that pulled back with the prices of physical platinum and palladium in both May and June, thereby reversing some of their robust year-to-date gains. Many analysts believed these metals were due for a selloff after a period of strong price appreciation. In particular, palladium has become the most valuable of the four major precious metals, with an acute shortage driving prices to records in recent years. Palladium and platinum are key components in pollution-control devices for cars and trucks; as global vehicle production began to slump due to a shortage of semiconductor chips, ebbing catalyst-metal demand from the sector temporarily eased a palladium supply deficit that had pushed its price up more than sixfold since early 2016, a level of inflation that has lifted it above the price of gold. Outlook & Strategy • The second quarter recovery in gold prices was muted by a mid-June selloff triggered by stimulus-tapering commentary by the US Federal Reserve that seemed to quell growing inflationary concerns. Despite notable improvements in the United States, China and elsewhere, the global economy is still under extreme stress after a year of pandemic-induced lockdowns, and the path to a full global recovery is unlikely to be smooth in all parts of the world. We continue to believe that inflation will feature prominently in many countries as governments may look to deflate their way out of the debt they have had to take on in the pandemic. This may drive regional demand for gold as it is considered a proven alternative to holding paper money in inflationary environments. • Gold has had a very low correlation with most other asset classes over time, but gold industry equities have remained closely correlated to gold bullion price trends. We have seen this tight correlation continue in the first half of 2021 with equities tracking gold lower in Q1, rallying with gold in April and May, only to give back much of the gains in June as gold sold off. Although movements in gold are likely to remain a key driver, we feel it is also important to step back and recognize that US$1,800-an-ounce gold provides an excellent backdrop for gold companies, and higher byproduct copper credits (copper ore is often found alongside gold in many parts of the world) are likely to further support strong cash generation in 2021. • Mining companies have maintained a keen focus on improving the cost structure of their operations, debt repayment and asset rationalization, which we believe should result in better business fundamentals and improved stock performance potential as management teams look increasingly focused on generating free cash flow that can be returned to shareholders via dividends or reinvested in high-return projects. • Aside from traditional currency effects, many gold market analysts speculate that Bitcoin and other cryptocurrencies might be replacing gold in some investors’ minds as an inflation hedge. However, we see significant differences in the way many governments view and treat cryptocurrencies compared to gold, and we certainly see government regulations as a major risk factor that does not exist to the same degree for gold given the long history and central banks’ heavy involvement in the gold market. • In our view, a turbulent 2020 leaves lingering uncertainty in the gold markets but also presents several areas for demand to potentially grow. Indian demand for gold in 2020 was at its lowest level in the World Gold Council’s data series, leaving significant room for increased demand moving forward as the economy hopefully normalizes. Global central bank buying fell off in 2020 as cash was deployed to stabilize economies and provide economic stimulus, but gold may again find favor with central banks if interest rates remain historically low and global currency markets become choppy. World Gold Council data showed net central bank purchases of 299.5 metric tons in the first five months of 2021, representing the strongest start to any year since 2009. • Gold prices averaged US$1,814 per ounce in Q2 2021—just above the Q1 average of US$1,797 and slightly below the Q4 2020 average of US$1,876, but still at a level that should support strong free cash flow for gold producers. Despite some cost pressures surfacing with rising labor, steel and oil prices, gold is still well above the Q2 2020 average of US$1,714 per ounce, which should allow positive year-over-year comparisons. In franklintempleton.com 2 Franklin Gold and Precious Metals Fund–Class A June 30, 2021

addition, most gold mines have resumed operations following pandemic-induced shutdowns that began just over a year ago, leaving many companies better-positioned to benefit from still-elevated gold prices. Additionally, prices continue to find support from investor demand as ETF (exchange-traded fund) physical gold holdings increased by 603,000 ounces in Q2 to 100.83 million ounces, thanks to an uptick in May. • Given several years of underinvestment by the gold industry, we expect a pickup in merger and acquisition (M&A) activity in 2021, although the pace continues to be impacted in the near term by travel restrictions and other pandemic-induced business impairments. We have already seen several M&A deals in the first half of 2021 and expect this to continue. In addition, we believe small- and middle-capitalization gold equities may present some of the best opportunities given their generally lower valuations and our belief in the need for further M&A consolidation as mining companies seek to replenish their resources following several years of limited exploration and development activity. • Other precious metals such as platinum, palladium and rhodium have very different supply and demand profiles, but all of these metals have been seeing upward price movement so far this year. Palladium prices pushed to a new all-time high in early May, while rhodium, used in automotive catalytic converters to remove nitrogen oxide, experienced a selloff in late May and June but still ended the period above any price level seen prior to 2021 (at over US$20,000 per ounce), making it one of the rarest and most valuable precious metals in the world based on higher demand from the automotive industry to meet stricter emission standards. *The information provided is not a complete analysis of every material fact regarding any country, market, industry, security or fund. Because market and economic conditions are subject to change, comments, opinions and analyses are rendered as of the date of this material and may change without notice. A portfolio manager’s assessment of a particular security, investment or strategy is not intended as individual investment advice or a recommendation or solicitation to buy, sell or hold any security or to adopt any investment strategy; it is intended only to provide insight into the fund’s portfolio selection process. Holdings are subject to change.

Portfolio Characteristics6,7

Portfolio FTSE Gold Mines Index Market Capitalization (Millions in USD) 7,764 23,124 Return on Equity 4.65% 14.67% Historical 3-Year EPS Growth -39.88% 39.40% Estimated 3-5 Yr EPS Growth 14.41% 8.97% Price to Earnings (12 Month Forward) 10.64x 13.84x

Portfolio Diversification Top Ten Holdings8 Percent of Total Top Holdings Country % ENDEAVOUR MINING PLC Burkina Faso 5.09 BARRICK GOLD CORP Canada 5.01 NEWMONT CORP United States 3.70 NEWCREST MINING LTD Australia 3.57 PERSEUS MINING LTD Australia 3.49 IMPALA PLATINUM HOLDINGS LTD South Africa 3.16 IVANHOE MINES LTD Canada 3.10 ALAMOS GOLD INC Canada 2.98 SSR MINING INC Canada 2.83 ANGLOGOLD ASHANTI LTD South Africa 2.62

6. The portfolio characteristics listed are based on the fund’s underlying holdings, and do not necessarily reflect the fund’s characteristics. Due to data limitations all equity holdings are assumed to be the primary equity issue (usually the ordinary or common shares) of each security’s issuing company. This methodology may cause small differences between the portfolio’s reported characteristics and the portfolio’s actual characteristics. In practice, Franklin Templeton’s portfolio managers invest in the class or type of security which they believe is most appropriate at the time of purchase. The market capitalization figures for both the portfolio and the benchmark are at the security level, not aggregated up to the main issuer. Source: FactSet, Refinitiv. There can be no assurance that the Estimated 3-5 Year EPS Growth figure, based on Institutional Brokers Estimate System (IBES) consensus estimates, will be realized. All holdings are subject to change. 7. Source for Index: FactSet. Indexes are unmanaged, and one cannot invest directly in an index. They do not reflect any fees, expenses or sales charges. 8. Holdings of the same issuers have been combined. Top ten holdings information is historical and may not reflect current or future portfolio characteristics. All holdings are subject to change. The information provided is not a recommendation to purchase, sell, or hold any particular security. The portfolio manager reserves the right to withhold release of information with respect to holdings that would otherwise be included. franklintempleton.com 3 Franklin Gold and Precious Metals Fund–Class A June 30, 2021

Geographic Weightings vs. FTSE Gold Mines Index9,10 Sector Weightings vs. FTSE Gold Mines Index11,12 Percent of Total Percent of Total

39.92 Canada 49.35 Long Life Gold Mines 46.25 78.28

United States 5.25 22.11 24.66 Gold Exploration & 0.00 Development Australia 21.63 14.80 13.21 Medium Life Gold Mines South Africa 11.77 20.80 8.18 12.34 Burkina Faso 5.09 Precious Metals & Minerals 0.00 0.92

Egypt 1.41 9.35 0.00 Diversified Metals & Mining 0.00 Kyrgyzstan 2.02 0.00 0.69 Silver Philippines 0.22 0.00 0.00 0.58 China 0.18 Copper 0.46 0.00

Turkey 1.42 0.68 0.00 Other 0.00 Peru 0.53 0.00 1.11 Cash & Cash Equivalents Cash & Cash Equivalents 1.11 0.00 0.00

0% 25% 50% 75% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90%

Franklin Gold and Precious Metals Fund Franklin Gold and Precious Metals Fund FTSE Gold Mines Index FTSE Gold Mines Index Asset Allocation13 Percent of Total

Equity 98.89

Cash & Cash Equivalents 1.11

0% 25% 50% 75%100% 125%

Performance Statistics Risk Statistics14,15 Class A 3 Yrs 5 Yrs 10 Yrs Standard Deviation (%) 37.25 32.85 35.59 Tracking Error (%) 13.92 12.43 12.14 Information Ratio 0.54 0.13 0.01 Beta 0.94 0.93 0.92 Sharpe Ratio 0.60 0.14 -0.12

Past performance is not an indicator or a guarantee of future performance.

9,11,13. Percentage may not equal 100% due to rounding. All holdings are subject to change. 10,12. Source for Index: FactSet. Indexes are unmanaged, and one cannot invest directly in an index. They do not reflect any fees, expenses or sales charges. 14. Information Ratio and Tracking Error information are displayed for the product versus the FTSE Gold Mines Index. 15. Information Ratio is a way to evaluate a manager’s ability to outperform a benchmark in relation to the risk that manager is assuming, with risk defined as deviation from the benchmark. This measure is calculated by dividing the portfolio’s excess return (portfolio return less the benchmark return) by the tracking error (derived by taking the standard deviation of the monthly differences between the portfolio return and the benchmark return over time).

franklintempleton.com 4 Franklin Gold and Precious Metals Fund–Class A June 30, 2021

Investment Strategy & Process • Actively managed with a long-term focus • Research driven • Top down/bottom-up approach • Valuation discipline • Diversified globally across precious metals • Look to maintain a stable risk profile over time

Top-Down Macro Analysis to determine industry weightings (Supply & Demand, Commodity Cycles)

Integrate macro view seeking to identify Micro level feedback to refine macro companies that have outperform potential Portfolio of Our Best Ideas models

Bottom-Up In-Depth Fundamental Research seeking to identify the most attractive investment opportunity

Investment Team

Portfolio Manager Years with Firm Years Experience Steve Land, CFA 23 24 Fred Fromm, CFA 28 29

Glossary Beta: A measure of the magnitude of a portfolio’s past share-price fluctuations in relation to the ups and downs of the overall market (or appropriate market index). The market (or index) is assigned a beta of 1.00, so a portfolio with a beta of 1.20 would have seen its share price rise or fall by 12% when the overall market rose or fell by 10%. Estimated 3-5 Year EPS Growth: An estimated measure of the growth of earnings per share over a forward-looking period. For a portfolio, the value represents a weighted average of the stocks it holds. Historical 3-Year EPS Growth: A measure of the growth of earnings per share over a trailing 3 year period. For a portfolio, the value represents a weighted average of the stocks it holds. Information Ratio: In investing terminology, the ratio of expected return to risk. Usually, this statistical technique is used to measure a manager’s performance against a benchmark. This measure explicitly relates the degree by which an investment has beaten the benchmark to the consistency by which the investment has beaten the benchmark. Market Capitalization: A determination of a company’s value, calculated by multiplying the total number of company stock shares outstanding by the price per share. Market capitalization is expressed in millions of USD. Price to Earnings (12-mo Forward): A measure of the price to earnings ratio for a stock using the forecasted earnings for the next 12 months. For a portfolio, the value represents a weighted average of the stocks it holds. Return on Equity: A measure of a corporation’s profitability that reveals how much profit a company generates with the money shareholders have invested. For a portfolio, the value represents a weighted average of the stocks it holds. Sharpe Ratio: To calculate a Sharpe ratio, an asset’s excess returns (its return in excess of the return generated by risk-free assets such as Treasury bills) are divided by the asset’s standard deviation. Standard Deviation: A measure of the degree to which returns vary from the average of its previous returns. The larger the standard deviation, the greater the likelihood (and risk) that performance will fluctuate from the average return. Tracking Error: Measure of the deviation of the return of a product compared to the return of a benchmark over a fixed period of time. Expressed as a percentage. The more passively the investment is managed, the smaller the tracking error.

franklintempleton.com 5 Franklin Gold and Precious Metals Fund–Class A June 30, 2021

What Are The Risks? All investments involve risks, including possible loss of principal. The fund concentrates in the precious metals sector which involves fluctuations in the price of gold and other precious metals and increased susceptibility to adverse economic and regulatory developments affecting the sector. In times of stable economic 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. These and other risks are described more fully in the fund’s prospectus. Important Legal Information Investors should carefully consider a fund’s investment goals, risks, charges and expenses before investing. To obtain a summary prospectus and/or prospectus, which contains this and other information, talk to your financial professional, call us at (800) DIAL BEN/342-5236 or visit franklintempleton.com. Please carefully read a prospectus before you invest or send money. Franklin Distributors, LLC. Member FINRA/SIPC. Standard & Poor’s®, S&P® and S&P 500® are registered trademarks of Standard & Poor’s Financial Services LLC. S&P does not sponsor, endorse, sell or promote and S&P index-based product. Source: FactSet, FTSE. Source: FactSet. Important data provider notices and terms available at www.franklintempletondatasources.com. CFA® and Chartered Financial Analyst® are trademarks owned by CFA Institute.

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