DOWNERS GROVE, Ill., April 6, 2017 /PRNewswire/ -- Invesco (NYSE: IVZ), a leading global provider of exchange-traded funds (ETFs), announced today the launch of two new factor ETFs. With these two funds, PowerShares now has 78 ETFs in its factor line-up.
"We're putting client outcomes and investment preferences at the center of our product development process," said Jason Bloom, Global Market Strategist at PowerShares by Invesco. "Working closer with clients to understand their unique investment objectives has led to more strategic ETF solutions that have purpose in a portfolio."
PowerShares S&P 500 Value with Momentum Portfolio (Bats: SPVM)
SPVM seeks to track the S&P 500 High Momentum Value Index, which is designed to measure the performance of 100 stocks within the S&P 500® with attractive valuations that have also demonstrated positive momentum.
The first step screens for value based on three price metrics: price-to-book, price-to-earnings and price-to-sales. The resulting stock universe is then assigned a value score, with the 200 most attractively valued stocks selected for a momentum screen. From the 200 stocks, the 100 with the highest positive momentum score are then selected for inclusion in the index. Stocks are weighted by their value score and rebalanced semiannually.
This enhanced methodology is designed to provide a more robust approach to the value factor. By using a momentum overlay, SPVM's underlying methodology seeks to identify early movers with upward price movement while also avoiding value traps, instances when a stock appears cheap because it is trading at low multiples of earnings, cash flow or book value, but the stock price remains low and doesn't improve.
"S&P Dow Jones Indices has seen an increased popularity of its factor indices, and most recently, a growing interest in capturing multiple factors within one benchmark," said Vinit Srivastava, Managing Director of Strategy Indices at S&P Dow Jones Indices. "For market participants, the S&P 500 High Momentum Value Index and the S&P SmallCap 600 Quality Index are examples of how factors may be combined or applied across capitalizations. We are happy to be working with PowerShares in bringing these indices to market."
PowerShares S&P SmallCap Quality Portfolio (Bats: XSHQ)
XSHQ seeks to track the S&P SmallCap 600 Quality Index, which is designed to measure the highest-quality companies within the S&P SmallCap 600 Index by selecting securities based on an average of three quality metrics, which seek to capture a company's profitability, earnings quality and financial risk.
The quality screens implemented in XSHQ seek to enhance risk-adjusted returns by investing in companies with strong balance sheets and proven profitability and earnings quality as measured by accruals. Each stock is weighted by the total of its quality score multiplied by its market capitalization; stocks with higher scores receive relatively greater weights. Like SPVM, this fund and index are rebalanced semiannually.
About PowerShares by Invesco
PowerShares by Invesco is leading the Intelligent ETF Revolution® through its family of more than 140 domestic and international PowerShares exchange-traded funds (ETFs). PowerShares ETFs seek to outperform traditional benchmark indexes while providing advisors and investors access to an innovative array of focused investment opportunities. PowerShares has US franchise assets exceeding $110 billion as of December 30, 2016. For more information, please visit us at powershares.com or follow us on Twitter @PowerShares.
Important Risk Information
There are risks involved with investing in ETFs, including possible loss of money. Shares are not actively managed and are subject to risks similar to those of stocks, including those regarding short selling and margin maintenance requirements. Ordinary brokerage commissions apply. The Fund's return may not match the return of the underlying 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.
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 Funds are non-diversified and may experience greater volatility than a more diversified investment.
Factor investing is an investment strategy in which securities are chosen based on certain characteristics and attributes.
Price-to-book ratio (P/B Ratio) is a ratio used to compare a stock's market value to its book value. It is calculated by dividing the current closing price of the stock by the latest quarter's book value per share.
Price-to-earnings ratio (P/E Ratio) is the ratio for valuing a company that measures its current share price relative to its per-share earnings.
Price-to-sales ratio, P/S ratio, or PSR, is a valuation metric for stocks. It is calculated by dividing the company's market cap by the revenue in the most recent year; or, equivalently, divide the per-share stock price by the per-share revenue.
Momentum style of investing is subject to the risk that the securities may be more volatile than the market as a whole or returns on securities that have previously exhibited price momentum are less than returns on other styles of investing.
A value style of investing is subject to the risk that the valuations never improve or that the returns will trail other styles of investing or the overall stock markets.
Stocks of small-capitalization companies tend to be more vulnerable to adverse developments, may be more volatile, and may be illiquid or restricted as to resale than large companies.
S&P® is a registered trademark of Standard & Poor's Financial Services LLC (S&P) and Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (Dow Jones). These trademarks have been licensed for use by S&P Dow Jones Indices LLC. S&P® and Standard & Poor's® are trademarks of S&P and Dow Jones® is a trademark of Dow Jones. These trademarks have been sublicensed for certain purposes by Invesco PowerShares Capital Management LLC (PowerShares). The Index is a product of S&P Dow Jones Indices LLC and/or its affiliates and has been licensed for use by PowerShares. The Fund is not sponsored, endorsed, sold or promoted by S&P Dow Jones Indices LLC, Dow Jones, S&P or their respective affiliates and neither S&P Dow Jones Indices LLC, Dow Jones, S&P or their respective affiliates make any representation regarding the advisability of investing in such product(s).
An investment cannot be made into an index.
The S&P Index(es) (the "Index(es)") underlying the product provider's (the "Issuer") investment products (the "Investment Products") are proprietary to S&P Dow Jones Indices LLC ("S&P DJI"). S&P® and the names identifying the Index(es) are trademarks of Standard & Poor's Financial Services LLC and have been licensed for use by S&P DJI and sublicensed for certain purposes by the Issuer. The Issuer's Investment Products based on the Index(es) are not in any way sponsored, endorsed, sold or promoted by S&P DJI, its affiliates or licensors and those parties make no representations or warranties, express or implied, regarding the advisability of investing in securities generally or in the Investment Products particularly or the ability of the Index(es) to track general market performance.
Shares are not individually redeemable and owners of the Shares may acquire those Shares from the Fund and tender those Shares for redemption to the Fund in Creation Unit aggregations only, typically consisting of 10,000, 50,000, 75,000, 100,000 or 200,000 Shares.
PowerShares® is a registered trademark of Invesco Ltd., used by the investment adviser, Invesco PowerShares Capital Management LLC (PowerShares) under license. PowerShares and Invesco Distributors, Inc., ETF distributor, are indirect, wholly owned subsidiaries of Invesco Ltd.
Before investing, investors should carefully read the prospectus/summary prospectus and carefully consider the investment objectives, risks, charges and expenses. For this and more complete information about the Fund call 800 983 0903 or visit invescopowershares.com for the prospectus/summary prospectus.
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