Products December 19, 2013

Invesco Overhauls Some ETFs

Invesco PowerShares, a provider of exchange-traded funds (ETFs), will change the names and underlying indexes of 10 ETFs.
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Four other funds in the Invesco ETF product line—together representing less than 1% of the firm’s total assets—will be closed, according to a statement from Invesco.

Dan Draper, managing director of global ETFs, says the move is a result of regular evaluation of the firm’s funds.

“We regularly evaluate our ETF product offerings using numerous factors including investment results, how investors may utilize them in portfolios and length of time in the market, among others,” Draper says.

Invesco’s board of trustees approved the changes on December 17. They are slated to take effect February 19, 2014, meaning the final trading day for the closing funds will be February 18, 2014.

Here’s a rundown of the 10 funds getting new names:

  • PowerShares Dynamic OTC Portfolio becomes the PowerShares DWA NASDAQ Momentum Portfolio;
  • PowerShares Dynamic Basic Materials Sector Portfolio becomes the PowerShares DWA Basic Materials Momentum Portfolio;
  • PowerShares Dynamic Consumer Discretionary Sector Portfolio becomes the PowerShares DWA Consumer Cyclicals Momentum Portfolio;
  • PowerShares Dynamic Consumer Staples Sector Portfolio becomes the PowerShares DWA Consumer Staples Momentum Portfolio;
  • PowerShares Dynamic Energy Sector Portfolio becomes the PowerShares DWA Energy Momentum Portfolio;
  • PowerShares Dynamic Financial Sector Portfolio becomes the PowerShares DWA Financial Momentum Portfolio;
  • PowerShares Dynamic Healthcare Sector Portfolio becomes the PowerShares DWA Healthcare Momentum Portfolio;
  • PowerShares Dynamic Industrials Sector Portfolio becomes the PowerShares DWA Industrials Momentum Portfolio;
  • PowerShares Dynamic Technology Sector Portfolio becomes the PowerShares DWA Technology Momentum Portfolio; and
  • PowerShares Dynamic Utilities Portfolio becomes the PowerShares DWA Utilities Momentum Portfolio.

The funds will be based on momentum strategies developed by investment analysis firm Dorsey Wright. The strategies utilize Dorsey Wright’s analysis of relative strength characteristics to make stock selection decisions, explains Lorraine Wang, Invesco’s global head of ETF products and research.

Funds that will close include the following:

  • PowerShares KBW International Financial Portfolio
  • PowerShares MENA Frontier Countries Portfolio
  • PowerShares Dynamic MagniQuant Portfolio
  • PowerShares Lux Nanotech Portfolio

Shareholders may sell their holdings on or before February 18, 2014 and may incur typical transaction fees from their broker-dealer, according to the statement. Shareholders who do not sell their holdings on or before February 18, 2014 will receive cash equal to the amount of the net asset value of their shares, which will include any capital gains and dividends in the cash portion of their brokerage accounts.

The shareholder payment date is currently scheduled for on or about February 25, 2014.  Shareholders will generally recognize a capital gain or loss equal to the amount received for their shares over their adjusted basis in such shares.

For additional information, shareholders of the ETFs which are scheduled for changes or liquidation may call Invesco PowerShares at 800-983-0903.

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