The Invesco Variable Rate Investment Grade ETF (Fund) is an actively managed exchange-traded fund (ETF) that seeks to generate current income while maintaining low portfolio duration as a primary objective and capital appreciation as a secondary objective. Under normal market conditions, the Fund generally will invest at least 80% of its net assets, plus any borrowings, in a portfolio of investment-grade, variable rate instruments that are US dollar denominated and US issued. Invesco, Advisers, Inc., the sub-adviser to the Fund (Sub-Adviser), seeks to invest in floating rate US Treasuries, government sponsored agency mortgage-backed securities, US Agency debt, structured securities and floating rate investment grade corporates. The Fund is able to invest in other types of securities as outlined in the prospectus, including up to 20% in non-investment grade securities.
Morningstar Rating ™Overall Rating - Ultrashort Bond Category
As of 09/30/2022 the Fund had an overall rating of 5 stars out of 216 funds and was rated 5 stars out of 216 funds, 5 stars out of 178 funds and N/A stars out of N/A funds for the 3-, 5- and 10- year periods, respectively.
Source: Morningstar Inc. Ratings are based on a risk-adjusted return measure that accounts for variation in a fund's monthly performance, placing more emphasis on downward variations and rewarding consistent performance. Open-end mutual funds and exchange-traded funds are considered a single population for comparison purposes. Ratings are calculated for funds with at least a three year history. The overall rating is derived from a weighted average of three-, five- and 10-year rating metrics, as applicable, excluding sales charges and including fees and expenses. ©2022 Morningstar Inc. All rights reserved. The information contained herein is proprietary to Morningstar and/or its content providers. It may not be copied or distributed and is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance does not guarantee future results. The top 10% of funds in a category receive five stars, the next 22.5% four stars, the next 35% three stars, the next 22.5% two stars and the bottom 10% one star. Ratings are subject to change monthly. Had fees not been waived and/or expenses reimbursed currently or in the past, the Morningstar rating would have been lower. Ratings for other share classes may differ due to different performance characteristics.
|Index History (%)||YTD||1Yr||3Yr||5Yr||10Yr||Since Inception|
|Bloomberg Barclays US Floating Rate Note Index||0.36||0.29||0.92||1.68||1.47||1.79|
|Fund History (%)|
|After Tax Held||-1.03||-1.12||0.39||0.73||N/A||0.97|
|After Tax Sold||-0.25||-0.27||0.50||0.84||N/A||1.03|
|Fund Market Price||-0.50||-0.53||0.94||1.54||N/A||1.80|
|Index History (%)||YTD||1Yr||3Yr||5Yr||10Yr||Since Inception|
|Bloomberg Barclays US Floating Rate Note Index||0.24||0.17||0.99||1.71||1.49||1.80|
|Fund History (%)|
|After Tax Held||-0.85||-0.94||0.54||0.82||N/A||1.01|
|After Tax Sold||-0.23||-0.24||0.60||0.90||N/A||1.06|
|Fund Market Price||-0.62||-0.68||1.04||1.56||N/A||1.80|
Market returns are based on the midpoint of the bid/ask spread at 4 p.m. ET and do not represent the returns an investor would receive if shares were traded at other times. Performance data quoted represents past performance, which is not a guarantee of future results. Investment returns and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. Current performance may be higher or lower than performance data quoted. After-tax returns reflect the highest federal income tax rate but exclude state and local taxes. After Tax Held and After Tax Sold are based on NAV. Returns less than one year are cumulative.
Growth of $10,000
Data beginning Fund inception and ending 09/30/2022. Fund performance shown at NAV.
An investor cannot invest directly in an index. The results assume that no cash was added to or assets withdrawn from the Index. Index returns do not represent Fund returns. The Index does not charge management fees or brokerage expenses, nor does the Index lend securities, and no revenues from securities lending were added to the performance shown.
Quality Allocations† as of 11/28/2022
|Rating||% of Fund|
Cash is excluded from the credit rating quality allocations table.
|Years||% of Fund|
|0 - 1 years||15.94|
|1 - 5 years||48.49|
|5 - 10 years||2.13|
|10 - 15 years||10.29|
|15 - 20 years||17.76|
|20 - 25 years||0.72|
|25 years and over||4.67|
as of 11/28/2022 Top Fixed-Income Holdings | View All
|Holding Name||Coupon Rate||Maturity Date||Next Call Date||Quality Rating †||Weight|
|United States Treasury Floating Rate Note||4.26%||04/30/2024||N/A||AAA||11.27%|
|United States Treasury Floating Rate Note||4.37%||07/31/2024||N/A||AAA||3.15%|
|American Express Co||5.39%||02/27/2023||01/27/2023||A||0.92%|
|Freddie Mac STACR REMIC Trust 2021-DNA6||5.05%||10/25/2041||10/25/2026||BBB-||0.92%|
|Invesco Government & Agency Portfolio||N/A||N/A||0.91%|
|ING Groep NV||4.74%||10/02/2023||N/A||A+||0.89%|
|Athene Global Funding||4.52%||05/24/2024||N/A||A+||0.87%|
|NextEra Energy Capital Holdings Inc||4.42%||03/21/2024||12/29/2022||A-||0.86%|
|STAR 2022-SFR3 Trust||5.82%||05/17/2024||N/A||AA-||0.86%|
Holdings are subject to change and are not buy/sell recommendations.
Risk & Other Information
† Ratings are based on S&P, Moody's or Fitch, as applicable. 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 (highest) to D (lowest); ratings are subject to change without notice. NR indicates the debtor was not rated, and should not be interpreted as indicating low quality. If securities are rated differently by the rating agencies, the higher rating is applied. Credit ratings are based largely on the rating agency's investment analysis at the time of rating and the rating assigned to any particular security is not necessarily a reflection of the issuer's current financial condition. The rating assigned to a security by a rating agency does not necessarily reflect its assessment of the volatility of a security's market value or of the liquidity of an investment in the security. For more information on the rating methodology, please visit the following NRSRO websites: standardandpoors.com and select 'Understanding Ratings' under Rating Resources on the home page; moodys.com and select 'Rating Methodologies' under Research and Ratings on the home page; fitchratings.com and select 'Ratings Definitions' on the home page.
There are risks involved with investing in ETFs, including possible loss of money. Actively managed ETFs do not necessarily seek to replicate the performance of a specified index. Actively managed ETFs are subject to risks similar to stocks, including those related to short selling and margin maintenance. Ordinary brokerage commissions apply. The Fund's return may not match the return of the Index. The Fund is subject to certain other risks. Please see the current prospectus for more information regarding the risk associated with an investment in the Fund.
An issuer may be unable to meet interest and/or principal payments, thereby causing its instruments to decrease in value and lowering the issuer’s credit rating.
Interest rate risk refers to the risk that bond prices generally fall as interest rates rise and vice versa.
The values of junk bonds fluctuate more than those of high quality bonds and can decline significantly over short time periods.
Investments focused in a particular industry or sector are subject to greater risk, and are more greatly impacted by market volatility, than more diversified investments.
The Fund may hold illiquid securities that it may be unable to sell at the preferred time or price and could lose its entire investment in such securities.
The Fund currently intends to effect creations and redemptions principally for cash, rather than principally in-kind because of the nature of the Fund's investments. As such, investments in the Fund may be less tax efficient than investments in ETFs that create and redeem in-kind.
Defaulted securities involve the substantial risk that principal will not be repaid and may be subject to restrictions on resale.
The Fund invests in financial instruments that use the London Interbank Offered Rate (“LIBOR”) as a reference or benchmark rate for variable interest rate calculations. LIBOR will be phased out by the end of 2021, and it's anticipated that LIBOR will cease to be published after that time. The uncertainty on the effects of the LIBOR transition process, therefore any impact of the LIBOR transition on the Fund or its investments cannot yet be determined. There is no assurance an alternative rate will be similar to, produce the same value or economic equivalence or instruments using the rate will have the same volume or liquidity as LIBOR. Any effects of LIBOR transition and the adoption of alternative rates could result in losses to the Fund.
Because the Fund may invest in ETFs and other investment companies, it's subject to the risks associated with the ETFs and investment company and its investment performance may depend on the underlying investment company's performance. The Fund will indirectly pay a proportional share of the investment company's fees and expenses, while continuing to pay its own management fee to the Adviser, resulting in shareholders absorbing duplicate levels of fees.
For mortgage-backed securities, if interest rates rise, borrowers may prepay mortgages more slowly than originally expected. This may further reduce market value and lengthen durations.
The Fund may invest in privately issued securities, including 144A securities which are restricted (i.e. not publicly traded). The liquidity market for Rule 144A securities may vary, as a result, delay or difficulty in selling such securities may result in a loss to the Fund.
Income generated from the Fund is based primarily on prevailing interest rates, which can vary widely over the short- and long-term. If interest rates drop, the Fund's income may drop as well.
Reinvestment risk is the risk that a bond’s cash flows (coupon income and principal repayment) will be reinvested at an interest rate below that on the original bond.
Obligations issued by US Government agencies and instrumentalities may receive varying levels of support from the government, which could affect the fund’s ability to recover should they default.The Fund will invest in bonds with short-term maturity (one year or less) which may have additional risks, including interest rate changes over the life of the bond. The average maturity of the Fund's investments will affect the volatility of the Fund's share price.
The Bloomberg Barclays US Floating Rate Note Index measures the performance of US dollar-denominated, investment grade floating rate notes.