Unit Trusts

Symbol: TGMT
Fact Card
Prospectus

Targeted opportunity in fixed income

Invesco Unit Trusts have deposited over 5,400 fixed income portfolios with over $46 billion in initial deposits and more than $22 billion in income paid out to unitholders since 1976.1

Targeted opportunity in fixed income

Invesco Unit Trusts is excited to announce the latest addition to our lineup of fixed income unit trusts, the Target Maturity Trusts (TGMT). Target Maturity Trusts will offer many of the same potential benefits found within our existing suite of fixed income unit trusts, such as: par value, monthly income and declining duration, but will provide the added benefit of a defined termination date.

The addition of a defined termination date helps to create an investment experience similar to that of an individual bond, but with the added benefits of diversification, monthly income and professional selection. Target Maturity Trusts are designed to provide a positive investment experience by:

  • Combining principal received in the final year of the trust into one-time distribution
  • Allowing investors to take advantage of the rollover discount as trusts reach termination
  • Making it easier to build a laddered bond portfolio
  • Creating a structure which allows investors the ability to target specific areas of the yield curve

For investors interested in this brand new maturing portfolio investment with a focus on a high level of income, Invesco Unit Trust's Targeted Maturity Investment Grade Corporate Trust (TGMT) may be the right investment.

TMGT Trust Life

DepositTGMT Deposit
  • The Invesco Unit Trust Fixed Income team will select approximately 20-30 investment grade corporate bonds
  • All bonds are scheduled to mature in the final calendar year of the trust
Income Phase
  • The portfolio will distribute consistent monthly income until the final year, when the bonds begin to mature
Maturing Period
  • Bonds begin to mature in the final calendar year of the trust
  • Maturing proceeds reinvested into U.S. Treasury securities and are expected to earn additional income until the termination date
TerminationTermination
  • Final principal distribution paid to unitholders at termination
  • Proceeds eligible for rollover discount 30 calendar days after termination

For illustrative purposes only.
Diversification does not ensure a profit or eliminate the risk of loss.

Ready to learn more? Contact your Invesco representative or financial advisor for more on how Invesco's Targeted Maturity Investment Grade Corporate Trust may help with your income needs.

1 As of June 30, 2016 through Invesco Unit Investment Trusts and predecessor firms.

Before investing, investors should carefully read the prospectus and consider the investment objectives, risks, charges and expenses. For this and more complete information about the trust, investors should ask their advisor(s) for a prospectus or download one at invesco.com/uit.

About risk

There is no assurance that a unit investment trust will achieve its investment objective. An investment in this unit investment trust is subject to market risk, which is the possibility that the market values of securities owned by the trust will decline and that the value of trust units may therefore be less than what you paid for them. Accordingly, you can lose money investing in this trust.

An investment in a trust should be made with the understanding of the risks associated therewith, such as the inability of the issuer or an insurer to pay the principal of or interest on a bond when due, volatile interest rates, early call provisions and changes to the tax status of the bonds.

The value of the bonds will generally fall if interest rates, in general, rise. Given the historically low interest rate environment in the U.S., risks associated with rising rates are heightened. The negative impact on fixed income securities from any interest rate increases could be swift and significant. No one can predict whether interest rates will rise or fall in the future.

The financial markets, including those for corporate bonds, have recently experienced periods of extreme illiquidity and volatility. Due to these significant difficulties in the financial markets, there can be substantial uncertainty in assessing the value of an issuer's assets or the extent of its obligations. For these or other reasons, the ratings of the bonds in the trust's portfolio may not accurately reflect the current financial condition or prospects of the issuer of the bond.

The portfolio is concentrated in the consumer discretionary sector. Companies that manufacture, distribute and provide consumer products and services face risks such as intense competition, the lack of serious barriers to entry for online entrants, economic recession and a slowdown in consumer spending trends.

Although the underlying securities in the portfolio are rated at or above the minimum credit quality as of the date of deposit, the ratings may change after inclusion in the trust.

Invesco and its representatives do not provide tax advice. Individuals should consult their personal tax advisors before making any tax-related investment decisions.

A credit rating is an assessment provided by a nationally recognized statistical rating organization (NRSRO) of the creditworthiness of an issuer with respect to debt obligations, including specific securities, money market instruments or other debts. Ratings are measured on a scale that generally ranges from AAA/Aaa (highest) to D/C (lowest); ratings are subject to change without notice. For more information on Standard and Poor's rating methodology, please visit www.standardandpoors.com and select 'Understanding Ratings' under Rating Resources on the homepage or Moody's at www.moodys.com and select 'Rating Methodologies' under Research and Ratings on the homepage.

Trust objective: The Trust seeks to provide a high level of current income and to preserve capital. The trust invests in a portfolio of investment grade corporate bonds each with a scheduled maturity date in calendar year 2021.

Preferred Opportunity

Compared with the top income tax rate of 43.4%, QDI is taxed at just 23.8% for those in the top tax bracket and 18.8% for investors in most lower brackets.

The preferred opportunity

On top of the potentially attractive yields for preferred securities, they may also allow investors to keep more of what they earn. Preferreds generally pay qualified dividend income (QDI)1, which is taxed at a lower rate than ordinary income. Compared with the top income tax rate of 43.4%, QDI is taxed at just 23.8% for those in the top tax bracket and 18.8% for investors in most lower brackets.

Preferred securities are a potential high income alternative to investment grade and high yield bonds.2 Tax-advantaged income helps you potentially keep more of what you earn. In a rising interest rate environment, you may want to focus on income and spreads. Within credit sensitive fixed income securities, preferred securities are offering an attractive yield when comparing the yield spreads between investment-grade preferred securities and high-yield bonds.

For investors interested in a potentially high income and tax-advantaged investment, Invesco Unit Trust's Preferred Opportunity Portfolio (PFOP) is a duration sensitive approach with a portfolio that seeks to take advantage of the current spread advantage and fixed-to-float nature offered by preferreds.

Many preferred securities offer tax-advantaged income, potentially resulting in higher after-tax yields than municipal bonds3

Source: Cohen & Steers, BofA Merrill Lynch as of June 30, 2016. Past performance is no guarantee of future results. The information presented above does not reflect the performance of any trust. An investor cannot invest directly in an index and index performance does not reflect the deduction of any fees, expenses or taxes. Notes: Yields shown on a yield-to-maturity basis. The risks of loss attributable to bonds is generally less than that associated with owning preferred securities. (a) For individuals with income less than $400K, qualified dividend income is taxed at 18.8% and the marginal tax rate used was 38.8%. Both rates include the Medicare surcharge of 3.8%. (b) For individuals with income exceeding $400K, qualified dividend income is taxed at 23.8% and the marginal tax rate used was 43.4%. Both rates include the Medicare surcharge of 3.8%. (c) BofA Merrill Lynch Fixed Rate Preferred Securities Index (Credit quality: BBB) tracks the performance of fixed-rate U.S. dollar-denominated preferred securities issued in the U.S. domestic market. (d) BofA Merrill Lynch Municipal Master Index (Credit quality: AA-) tracks the performance of U.S. dollar-denominated investment-grade tax-exempt debt publicly issued by U.S. states and territories, and their political subdivisions, in the U.S. domestic market. Note: State and local taxes are not included in these calculations. You should consult your tax professional concerning federal, state and local tax consequences of investing in a particular series.

Ready to learn more? Contact your Invesco representative or financial advisor for more on how Invesco's Preferred Opportunity Portfolio may help with your income needs.

1 The Sponsor seeks to allocate a significant portion of the portfolio in preferred securities whose distributions are taxed as qualified dividend income (QDI). Approximately 80% or more of the portfolio of each PFOP trust deposited since May 2014 has been invested in preferred securities whose distributions are taxed as QDI.

2 Between 20–30% of the portfolio of each PFOP trust deposited since May 2014 has been invested in preferred securities rated below investment grade, otherwise known as "junk" securities. Please refer to a PFOP prospectus for a full discussion regarding the risks related to investments in "junk" rated securities.

3 The underlying risks of owning fixed rate instruments, such as bonds and treasuries, are substantially different than those of owning preferred securities (see "About risk"), however, the yield comparison on the previous page serves to demonstrate the potential for preferred securities to outperform bonds and treasuries. In viewing this comparison, investors should note that preferred securities are typically subordinated to bonds and other debt instruments in a company's capital structure in terms of priority to corporate income and therefore are subject to greater risk than those debt instruments.

Before investing, investors should carefully read the prospectus and consider the investment objectives, risks, charges and expenses. For this and more complete information about the trust, investors should ask their advisor(s) for a prospectus or download one at invesco.com/uit.

About risk

There is no assurance that the Portfolio will achieve its investment objective. The Portfolio is subject to market risk, which is the possibility that the market values of securities owned by the Portfolio will decline and that the value of Portfolio units may therefore be less than what you paid for them. This trust is unmanaged and its portfolio is not intended to change during the trust's life except in limited circumstances. Accordingly, you can lose money investing in the Portfolio. The trust should be considered as part of a long-term investment strategy and you should consider your ability to pursue it by investing in successive trusts, if available. You will realize tax consequences associated with investing from one series to the next.

Investors could experience dilution of their investment if the size of the portfolio is increased as Units are sold. There is no assurance that your clients' investment will maintain its proportionate share in the portfolio's profits and losses.

An investment in the trust should be made with an understanding of the risks associated with an investment in a portfolio of preferred securities, such as the inability of the issuer to pay the principal of or income on a security when due, volatile interest rates, early call provisions and changes to the tax status of the securities.

The portfolio invests exclusively in preferred securities, including hybrid and trust preferred securities. Hybrid-preferred securities are preferred securities typically issued by corporations, generally in the form of interest-bearing notes or preferred securities and may be perpetual in duration or may have a stated maturity. Trust preferred securities are similar to hybrid securities, but are typically issued by an affiliated business trust of a corporation, generally in the form of beneficial interests in subordinated debentures or similarly structured securities. Preferred securities do not generally have the growth potential of common stocks. They are also sensitive to interest rate changes and the market price generally falls with rising interest rates. In addition, they are more likely to be called for redemption in a declining interest rate environment. In the event of an issuer's bankruptcy, preferred securities will not be repaid until the issuer's other debt securities, which have priority, have been satisfied. Income payments on most preferreds are non-cumulative and can be deferred indefinitely; distributions on certain hybrid-trust preferreds may generally be deferred without default, although such payments will continue to accrue until paid.

The trust is concentrated in banks and other companies in the financial services industry and may present more risk than a more diversified investment. There are certain risks specific to the financial services sector, including the potential adverse effects of economic recession, volatile interest rates, and state and federal regulations.

Securities of foreign companies held by the funds in the portfolio present risks beyond those of U.S. issuers. These risks may include company's foreign market, international trade conditions, less regulation, smaller or less liquid markets, increased volatility, differing accounting practices and changes in the value of foreign currencies.

The portfolio will receive early returns of principal if securities are called or sold before the portfolio termination. If this happens your portfolio income will decline and you may not be able to reinvest the money you receive at as high a yield. In addition, the value of your units may decline if any portfolio securities trading at a premium are called at par.

Certain preferred securities in the portfolio are rated below investment grade and considered to be "junk" securities. Securities fated below "BBB-" by Standard and Poor's or below "Baa3" by Moody's are considered to be below investment grade. These securities are considered to be speculative and are subject to greater market and credit risks. Accordingly, the risk of default is higher than with investment grade securities. In addition, these securities may be more sensitive to interest rate changes and may be more likely to make early returns of principal.

Opinions and forecasts expressed by Cohen & Steers Capital Management Inc. (Cohen & SteersSM) are not necessarily those of Invesco, and may not actually come to pass. Cohen & Steers is the property of Cohen & Steers Capital Management Inc., which is not affiliated with Invesco. Cohen & Steers is being paid a license fee for the use of certain service marks and is also being compensated for portfolio consultant services.

Trust objective: The portfolio seeks an attractive level of current income by investing in a portfolio primarily consisting of preferred securities. Cohen & Steers, is the Portfolio Consultant. The Sponsor selected the final portfolio based upon the recommendations provided by the Portfolio Consultant.

Invesco unit investment trusts are distributed by the sponsor, Invesco Capital Markets, Inc. and broker dealers including Invesco Distributors, Inc. Both firms are indirect, wholly owned subsidiaries of Invesco Ltd.