UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number | 811-01424 |
AIM Equity Funds (Invesco Equity Funds)
(Exact name of registrant as specified in charter)
11 Greenway Plaza, Suite 1000 Houston, Texas 77046
(Address of principal executive offices) (Zip code)
Sheri Morris 11 Greenway Plaza, Suite 1000 Houston, Texas 77046
(Name and address of agent for service)
Registrant’s telephone number, including area code: (713) 626-1919
Date of fiscal year end: 10/31
Date of reporting period: 04/30/21
Item 1. Reports to Stockholders.
(a) | The Registrant’s semi-annual report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 is as follows: |
(b) | Not applicable |
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Semiannual Report to Shareholders
| April 30, 2021
| |||
| ||||
Invesco Charter Fund | ||||
Nasdaq: | ||||
A: CHTRX ◾ C: CHTCX ◾ R: CHRRX ◾ S: CHRSX ◾ Y: CHTYX ◾ R5: CHTVX ◾ R6: CHFTX |
2 | Fund Performance | |||
4 | Liquidity Risk Management Program | |||
5 | Schedule of Investments | |||
8 | Financial Statements | |||
11 | Financial Highlights | |||
12 | Notes to Financial Statements | |||
17 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Performance summary |
| |||
Fund vs. Indexes |
| |||
Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 28.57 | % | ||
Class C Shares | 28.11 | |||
Class R Shares | 28.37 | |||
Class S Shares | 28.67 | |||
Class Y Shares | 28.69 | |||
Class R5 Shares | 28.72 | |||
Class R6 Shares | 28.76 | |||
S&P 500 Index▼ (Broad Market Index) | 28.85 | |||
Russell 1000 Index▼ (Style-Specific Index) | 30.03 | |||
Lipper Large-Cap Core Funds Index∎ (Peer Group Index) | 28.87 | |||
Source(s): ▼RIMES Technologies Corp.; ∎Lipper Inc. | ||||
The S&P 500® Index is an unmanaged index considered representative of the US stock market. The Russell 1000® Index is an unmanaged index considered representative of large-cap stocks. The Russell 1000 Index is a trademark/service mark of the Frank Russell Co. Russell® is a trademark of the Frank Russell Co. The Lipper Large-Cap Core Funds Index is an unmanaged index considered representative of large-cap core funds tracked by Lipper. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
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For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their in-sights about market and economic news and trends. |
2 Invesco Charter Fund
Average Annual Total Returns |
| |||
As of 4/30/21, including maximum applicable sales charges |
| |||
Class A Shares | ||||
Inception (11/26/68) | 10.68 | % | ||
10 Years | 9.08 | |||
5 Years | 11.47 | |||
1 Year | 35.70 | |||
Class C Shares | ||||
Inception (8/4/97) | 6.33 | % | ||
10 Years | 9.04 | |||
5 Years | 11.90 | |||
1 Year | 41.55 | |||
Class R Shares | ||||
Inception (6/3/02) | 7.79 | % | ||
10 Years | 9.42 | |||
5 Years | 12.44 | |||
1 Year | 43.21 | |||
Class S Shares | ||||
Inception (9/25/09) | 10.52 | % | ||
10 Years | 9.81 | |||
5 Years | 12.85 | |||
1 Year | 43.77 | |||
Class Y Shares | ||||
Inception (10/3/08) | 10.14 | % | ||
10 Years | 9.98 | |||
5 Years | 13.02 | |||
1 Year | 43.90 | |||
Class R5 Shares | ||||
Inception (7/30/91) | 8.88 | % | ||
10 Years | 10.08 | |||
5 Years | 13.11 | |||
1 Year | 43.99 | |||
Class R6 Shares | ||||
10 Years | 10.08 | % | ||
5 Years | 13.17 | |||
1 Year | 44.04 |
Performance includes litigation proceeds. Had these proceeds not been received, total returns would have been lower.
Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares at net asset value and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC)
for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class S, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
3 Invesco Charter Fund
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 Invesco Charter Fund
April 30, 2021
(Unaudited)
Shares | Value | |||||
Common Stocks & Other Equity Interests–99.63% | ||||||
Aerospace & Defense–1.90% | ||||||
Lockheed Martin Corp. | 46,743 | $ 17,788,516 | ||||
Raytheon Technologies Corp. | 618,704 | 51,500,921 | ||||
69,289,437 | ||||||
Air Freight & Logistics–2.70% | ||||||
United Parcel Service, Inc., Class B | 482,971 | 98,458,468 | ||||
Application Software–1.40% | ||||||
Citrix Systems, Inc. | 55,117 | 6,826,240 | ||||
Workday, Inc., Class A(b) | 178,945 | 44,199,415 | ||||
51,025,655 | ||||||
Automobile Manufacturers–1.19% | ||||||
General Motors Co.(b) | 759,573 | 43,462,767 | ||||
Automotive Retail–1.84% | ||||||
CarMax, Inc.(b) | 256,767 | 34,211,635 | ||||
O’Reilly Automotive, Inc.(b) | 59,475 | 32,882,538 | ||||
67,094,173 | ||||||
Biotechnology–0.27% | ||||||
Neurocrine Biosciences, Inc.(b) | 105,446 | 9,963,593 | ||||
Cable & Satellite–1.70% | ||||||
Comcast Corp., Class A | 1,104,212 | 62,001,504 | ||||
Commodity Chemicals–0.54% | ||||||
Valvoline, Inc. | 621,461 | 19,513,875 | ||||
Communications Equipment–1.29% | ||||||
Motorola Solutions, Inc. | 250,506 | 47,170,280 | ||||
Construction Machinery & Heavy Trucks–0.89% | ||||||
Caterpillar, Inc. | 143,035 | 32,627,714 | ||||
Construction Materials–0.88% | ||||||
Vulcan Materials Co. | 179,483 | 31,991,050 | ||||
Consumer Finance–2.22% | ||||||
Capital One Financial Corp. | 542,256 | 80,839,525 | ||||
Data Processing & Outsourced Services–3.24% | ||||||
Fiserv, Inc.(b) | 466,506 | 56,036,701 | ||||
Mastercard, Inc., Class A | 162,178 | 61,961,726 | ||||
117,998,427 | ||||||
Distillers & Vintners–1.55% | ||||||
Constellation Brands, Inc., Class A | 235,601 | 56,619,632 | ||||
Diversified Banks–3.20% | ||||||
JPMorgan Chase & Co. | 759,760 | 116,858,686 | ||||
Electric Utilities–1.49% | ||||||
FirstEnergy Corp. | 1,434,080 | 54,380,314 | ||||
Electrical Components & Equipment–0.95% | ||||||
Hubbell, Inc. | 70,756 | 13,585,860 | ||||
Rockwell Automation, Inc. | 79,742 | 21,072,621 | ||||
34,658,481 |
Shares | Value | |||||
Environmental & Facilities Services–0.72% | ||||||
Waste Connections, Inc. | 221,516 | $ 26,384,771 | ||||
Financial Exchanges & Data–1.58% | ||||||
Intercontinental Exchange, Inc. | 490,198 | 57,701,207 | ||||
Food Distributors–1.05% | ||||||
Sysco Corp. | 452,230 | 38,317,448 | ||||
General Merchandise Stores–1.25% | ||||||
Target Corp. | 219,617 | 45,517,819 | ||||
Health Care Facilities–2.59% | ||||||
HCA Healthcare, Inc. | 470,272 | 94,552,888 | ||||
Health Care Services–1.41% | ||||||
CVS Health Corp. | 675,101 | 51,577,716 | ||||
Health Care Supplies–0.43% | ||||||
Alcon, Inc. (Switzerland) | 208,927 | 15,759,364 | ||||
Home Improvement Retail–2.05% | ||||||
Home Depot, Inc. (The) | 230,445 | 74,588,133 | ||||
Homebuilding–0.97% | ||||||
D.R. Horton, Inc. | 359,290 | 35,314,614 | ||||
Hotels, Resorts & Cruise Lines–1.24% | ||||||
Airbnb, Inc., Class A(b)(c) | 56,252 | 9,715,283 | ||||
Booking Holdings, Inc.(b) | 14,393 | 35,494,289 | ||||
45,209,572 | ||||||
Household Products–2.29% | ||||||
Procter & Gamble Co. (The) | 535,389 | 71,431,600 | ||||
Reckitt Benckiser Group PLC (United Kingdom) | 137,388 | 12,246,444 | ||||
83,678,044 | ||||||
Industrial Conglomerates–0.28% | ||||||
Honeywell International, Inc. | 45,054 | 10,048,844 | ||||
Industrial Machinery–1.71% | ||||||
Otis Worldwide Corp. | 802,744 | 62,509,675 | ||||
Industrial REITs–2.49% | ||||||
Prologis, Inc. | 777,601 | 90,613,845 | ||||
Integrated Telecommunication Services–1.83% | ||||||
Verizon Communications, Inc. | 1,155,574 | 66,780,621 | ||||
Interactive Home Entertainment–0.97% | ||||||
Zynga, Inc., Class A(b) | 3,279,053 | 35,479,353 | ||||
Interactive Media & Services–4.09% | ||||||
Facebook, Inc., Class A(b) | 411,588 | 133,799,027 | ||||
Snap, Inc., Class A(b) | 247,279 | 15,286,788 | ||||
149,085,815 | ||||||
Internet & Direct Marketing Retail–6.05% | ||||||
Amazon.com, Inc.(b) | 63,576 | 220,444,694 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Charter Fund
Shares | Value | |||||||
| ||||||||
Internet Services & Infrastructure–0.12% |
| |||||||
Snowflake, Inc., Class A(b) | 18,423 | $ | 4,266,583 | |||||
| ||||||||
IT Consulting & Other Services–2.12% |
| |||||||
Accenture PLC, Class A | 190,590 | 55,265,382 | ||||||
| ||||||||
Amdocs Ltd. | 287,528 | 22,064,899 | ||||||
| ||||||||
77,330,281 | ||||||||
| ||||||||
Life Sciences Tools & Services–2.12% |
| |||||||
Avantor, Inc.(b) | 592,695 | 18,989,948 | ||||||
| ||||||||
Thermo Fisher Scientific, Inc. | 124,061 | 58,337,204 | ||||||
| ||||||||
77,327,152 | ||||||||
| ||||||||
Managed Health Care–3.35% |
| |||||||
UnitedHealth Group, Inc. | 306,146 | 122,091,025 | ||||||
| ||||||||
Movies & Entertainment–1.47% |
| |||||||
Netflix, Inc.(b) | 92,068 | 47,274,156 | ||||||
| ||||||||
Warner Music Group Corp., Class A | 169,246 | 6,424,578 | ||||||
| ||||||||
53,698,734 | ||||||||
| ||||||||
Oil & Gas Exploration & Production–0.59% |
| |||||||
Cabot Oil & Gas Corp. | 1,280,553 | 21,346,819 | ||||||
| ||||||||
Oil & Gas Refining & Marketing–0.63% |
| |||||||
Valero Energy Corp. | 312,745 | 23,130,620 | ||||||
| ||||||||
Oil & Gas Storage & Transportation–0.64% |
| |||||||
Magellan Midstream Partners L.P. | 498,900 | 23,333,553 | ||||||
| ||||||||
Other Diversified Financial Services–2.20% |
| |||||||
Equitable Holdings, Inc. | 2,342,377 | 80,179,565 | ||||||
| ||||||||
Packaged Foods & Meats–1.27% |
| |||||||
a2 Milk Co. Ltd. (The) | 875,330 | 4,867,490 | ||||||
| ||||||||
Mondelez International, Inc., Class A | 680,580 | 41,386,070 | ||||||
| ||||||||
46,253,560 | ||||||||
| ||||||||
Pharmaceuticals–3.77% |
| |||||||
AstraZeneca PLC, ADR (United Kingdom) | 1,340,617 | 71,146,544 | ||||||
| ||||||||
Eli Lilly and Co. | 363,495 | 66,435,981 | ||||||
| ||||||||
137,582,525 | ||||||||
| ||||||||
Property & Casualty Insurance–1.78% |
| |||||||
Allstate Corp. (The) | 152,729 | 19,366,037 | ||||||
| ||||||||
Progressive Corp. (The) | 450,584 | 45,391,832 | ||||||
| ||||||||
64,757,869 | ||||||||
| ||||||||
Railroads–1.20% |
| |||||||
Union Pacific Corp. | 196,768 | 43,700,205 | ||||||
| ||||||||
Regional Banks–0.51% |
| |||||||
CIT Group, Inc. | 347,602 | 18,523,711 | ||||||
|
Shares | Value | |||||||
| ||||||||
Semiconductor Equipment–2.39% |
| |||||||
Applied Materials, Inc. | 655,401 | $ | 86,978,267 | |||||
| ||||||||
Semiconductors–4.37% |
| |||||||
QUALCOMM, Inc. | 671,211 | 93,164,087 | ||||||
| ||||||||
Texas Instruments, Inc. | 366,616 | 66,177,854 | ||||||
| ||||||||
159,341,941 | ||||||||
| ||||||||
Systems Software–8.14% |
| |||||||
Microsoft Corp. | 1,101,830 | 277,859,489 | ||||||
| ||||||||
VMware, Inc., Class A(b) | 118,949 | 19,130,568 | ||||||
| ||||||||
296,990,057 | ||||||||
| ||||||||
Technology Hardware, Storage & Peripherals–1.66% |
| |||||||
Apple, Inc. | 460,761 | 60,571,641 | ||||||
| ||||||||
Thrifts & Mortgage Finance–0.60% |
| |||||||
Rocket Cos., Inc., Class A | 980,224 | 22,006,029 | ||||||
| ||||||||
Water Utilities–0.45% |
| |||||||
American Water Works Co., Inc. | 104,664 | 16,326,537 | ||||||
| ||||||||
Total Common Stocks & Other Equity Interests |
| 3,633,254,678 | ||||||
| ||||||||
Money Market Funds–0.53% |
| |||||||
Invesco Government & Agency Portfolio, Institutional Class, 0.03%(d)(e) | 6,673,402 | 6,673,402 | ||||||
| ||||||||
Invesco Liquid Assets Portfolio, Institutional Class, 0.01%(d)(e) | 5,025,219 | 5,027,229 | ||||||
| ||||||||
Invesco Treasury Portfolio, Institutional Class, 0.01%(d)(e) | 7,626,746 | 7,626,746 | ||||||
| ||||||||
Total Money Market Funds |
| 19,327,377 | ||||||
| ||||||||
TOTAL INVESTMENTS IN SECURITIES (excluding investments purchased with cash collateral from securities on loan)-100.16% |
| 3,652,582,055 | ||||||
| ||||||||
Investments Purchased with Cash Collateral from Securities on Loan |
| |||||||
Money Market Funds–0.28% |
| |||||||
Invesco Private Government Fund, 0.01%(d)(e)(f) | 4,037,452 | 4,037,452 | ||||||
| ||||||||
Invesco Private Prime Fund, | 6,053,757 | 6,056,179 | ||||||
| ||||||||
Total Investments Purchased with Cash Collateral from Securities on Loan |
| 10,093,631 | ||||||
| ||||||||
TOTAL INVESTMENTS IN |
| 3,662,675,686 | ||||||
| ||||||||
OTHER ASSETS LESS LIABILITIES–(0.44)% |
| (16,018,638 | ) | |||||
| ||||||||
NET ASSETS–100.00% |
| $ | 3,646,657,048 | |||||
|
.
Investment Abbreviations:
ADR – American Depositary Receipt
REIT – Real Estate Investment Trust
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Charter Fund
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2021. |
(d) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
Change in | |||||||||||||||||||||||||||||||||||
Unrealized | |||||||||||||||||||||||||||||||||||
Value | Purchases | Proceeds | Appreciation | Realized | Value | ||||||||||||||||||||||||||||||
October 31, 2020 | at Cost | from Sales | (Depreciation) | Gain | April 30, 2021 | Dividend Income | |||||||||||||||||||||||||||||
Investments in Affiliated Money Market Funds: | |||||||||||||||||||||||||||||||||||
Invesco Government & Agency Portfolio, Institutional Class | $ | 2,008,474 | $ | 87,852,016 | $ | (83,187,088 | ) | $ | - | $ | - | $ | 6,673,402 | $ | 599 | ||||||||||||||||||||
Invesco Liquid Assets Portfolio, Institutional Class | 2,203,693 | 62,751,441 | (59,927,953 | ) | (437 | ) | 485 | 5,027,229 | 749 | ||||||||||||||||||||||||||
Invesco Treasury Portfolio, Institutional Class | 2,295,398 | 100,402,305 | (95,070,957 | ) | - | - | 7,626,746 | 290 | |||||||||||||||||||||||||||
Investments Purchased with Cash Collateral from Securities on Loan: | |||||||||||||||||||||||||||||||||||
Invesco Private Government Fund | 13,216,103 | 46,737,936 | (55,916,587 | ) | - | - | 4,037,452 | 584 | * | ||||||||||||||||||||||||||
Invesco Private Prime Fund | 19,824,154 | 62,954,324 | (76,722,300 | ) | (224 | ) | 225 | 6,056,179 | 4,059 | * | |||||||||||||||||||||||||
Total | $ | 39,547,822 | $ | 360,698,022 | $ | (370,824,885 | ) | $ | (661 | ) | $ | 710 | $ | 29,421,008 | $ | 6,281 |
* | Represents the income earned on the investment of cash collateral, which is included in securities lending income on the Statement of Operations. Does not include rebates and fees paid to lending agent or premiums received from borrowers, if any. |
(e) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
(f) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 1I. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
Information Technology | 24.73 | % | ||
Consumer Discretionary | 14.58 | |||
Health Care | 13.95 | |||
Financials | 12.09 | |||
Industrials | 10.36 | |||
Communication Services | 10.06 | |||
Consumer Staples | 6.17 | |||
Real Estate | 2.48 | |||
Other Sectors, Each Less than 2% of Net Assets | 5.21 | |||
Money Market Funds Plus Other Assets Less Liabilities | 0.37 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Charter Fund
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
Assets: | ||||
Investments in securities, at value | $ | 3,633,254,678 | ||
| ||||
Investments in affiliated money market funds, at value | 29,421,008 | |||
| ||||
Foreign currencies, at value (Cost $1,442) | 1,545 | |||
| ||||
Receivable for: | ||||
Investments sold | 931,310 | |||
| ||||
Fund shares sold | 431,756 | |||
| ||||
Dividends | 2,736,947 | |||
| ||||
Investment for trustee deferred compensation and retirement plans | 1,743,320 | |||
| ||||
Other assets | 83,423 | |||
| ||||
Total assets | 3,668,603,987 | |||
| ||||
Liabilities: | ||||
Payable for: | ||||
Investments purchased | 4,078,723 | |||
| ||||
Fund shares reacquired | 1,882,552 | |||
| ||||
Amount due custodian | 1,821,740 | |||
| ||||
Collateral upon return of securities loaned | 10,093,631 | |||
| ||||
Accrued fees to affiliates | 1,812,912 | |||
| ||||
Accrued trustees’ and officers’ fees and benefits | 282 | |||
| ||||
Accrued other operating expenses | 387,416 | |||
| ||||
Trustee deferred compensation and retirement plans | 1,869,683 | |||
| ||||
Total liabilities | 21,946,939 | |||
| ||||
Net assets applicable to shares outstanding | $ | 3,646,657,048 | ||
| ||||
Net assets consist of: | ||||
Shares of beneficial interest | $ | 2,218,339,947 | ||
| ||||
Distributable earnings | 1,428,317,101 | |||
| ||||
$ | 3,646,657,048 | |||
|
Net Assets: | ||||
Class A | $ | 3,444,664,810 | ||
| ||||
Class C | $ | 27,090,035 | ||
| ||||
Class R | $ | 19,817,410 | ||
| ||||
Class S | $ | 20,741,113 | ||
| ||||
Class Y | $ | 106,478,934 | ||
| ||||
Class R5 | $ | 8,431,309 | ||
| ||||
Class R6 | $ | 19,433,437 | ||
| ||||
Shares outstanding, no par value, with an unlimited number of shares authorized: |
| |||
Class A | 171,520,622 | |||
| ||||
Class C | 1,476,670 | |||
| ||||
Class R | 996,730 | |||
| ||||
Class S | 1,032,643 | |||
| ||||
Class Y | 5,276,896 | |||
| ||||
Class R5 | 395,500 | |||
| ||||
Class R6 | 912,338 | |||
| ||||
Class A: | ||||
Net asset value per share | $ | 20.08 | ||
| ||||
Maximum offering price per share | $ | 21.25 | ||
| ||||
Class C: | ||||
Net asset value and offering price per share | $ | 18.35 | ||
| ||||
Class R: | ||||
Net asset value and offering price per share | $ | 19.88 | ||
| ||||
Class S: | ||||
Net asset value and offering price per share | $ | 20.09 | ||
| ||||
Class Y: | ||||
Net asset value and offering price per share | $ | 20.18 | ||
| ||||
Class R5: | ||||
Net asset value and offering price per share | $ | 21.32 | ||
| ||||
Class R6: | ||||
Net asset value and offering price per share | $ | 21.30 | ||
|
* | At April 30, 2021, a security with a value of $9,618,047 was on loan to brokers. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Charter Fund
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
Investment income: | ||||
Dividends (net of foreign withholding taxes of $19,376) | $ | 27,121,931 | ||
| ||||
Dividends from affiliated money market funds (includes securities lending income of $60,881) | 62,519 | |||
| ||||
Total investment income | 27,184,450 | |||
| ||||
Expenses: | ||||
Advisory fees | 10,371,700 | |||
| ||||
Administrative services fees | 227,924 | |||
| ||||
Custodian fees | 18,945 | |||
| ||||
Distribution fees: | ||||
| ||||
Class A | 3,943,136 | |||
| ||||
Class C | 139,892 | |||
| ||||
Class R | 45,456 | |||
| ||||
Class S | 14,083 | |||
| ||||
Transfer agent fees – A, C, R, S and Y | 2,342,546 | |||
| ||||
Transfer agent fees – R5 | 3,983 | |||
| ||||
Transfer agent fees – R6 | 3,010 | |||
| ||||
Trustees’ and officers’ fees and benefits | 47,705 | |||
| ||||
Registration and filing fees | 61,615 | |||
| ||||
Reports to shareholders | 124,993 | |||
| ||||
Professional services fees | 35,527 | |||
| ||||
Other | 42,039 | |||
| ||||
Total expenses | 17,422,554 | |||
| ||||
Less: Fees waived and/or expense offset arrangement(s) | (11,427 | ) | ||
| ||||
Net expenses | 17,411,127 | |||
| ||||
Net investment income | 9,773,323 | |||
| ||||
Realized and unrealized gain (loss) from: | ||||
Net realized gain from: | ||||
Unaffiliated investment securities | 167,238,707 | |||
| ||||
Affiliated investment securities | 710 | |||
| ||||
Foreign currencies | 1,516 | |||
| ||||
167,240,933 | ||||
| ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Unaffiliated investment securities | 655,933,373 | |||
| ||||
Affiliated investment securities | (661 | ) | ||
| ||||
Foreign currencies | 12,001 | |||
| ||||
655,944,713 | ||||
| ||||
Net realized and unrealized gain | 823,185,646 | |||
| ||||
Net increase in net assets resulting from operations | $ | 832,958,969 | ||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Charter Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
April 30, 2021 | October 31, 2020 | |||||||
| ||||||||
Operations: | ||||||||
Net investment income | $ | 9,773,323 | $ | 21,571,362 | ||||
| ||||||||
Net realized gain | 167,240,933 | 57,681,020 | ||||||
| ||||||||
Change in net unrealized appreciation | 655,944,713 | 118,558,169 | ||||||
| ||||||||
Net increase in net assets resulting from operations | 832,958,969 | 197,810,551 | ||||||
| ||||||||
Distributions to shareholders from distributable earnings: | ||||||||
Class A | (72,039,344 | ) | (488,454,497 | ) | ||||
| ||||||||
Class C | (646,926 | ) | (6,728,167 | ) | ||||
| ||||||||
Class R | (378,832 | ) | (3,099,805 | ) | ||||
| ||||||||
Class S | (443,411 | ) | (2,802,798 | ) | ||||
| ||||||||
Class Y | (2,368,090 | ) | (15,304,355 | ) | ||||
| ||||||||
Class R5 | (203,608 | ) | (1,394,325 | ) | ||||
| ||||||||
Class R6 | (461,672 | ) | (3,107,812 | ) | ||||
| ||||||||
Total distributions from distributable earnings | (76,541,883 | ) | (520,891,759 | ) | ||||
| ||||||||
Share transactions–net: | ||||||||
Class A | (85,872,717 | ) | 110,614,848 | |||||
| ||||||||
Class C | (10,003,124 | ) | (5,090,743 | ) | ||||
| ||||||||
Class R | (826,284 | ) | (1,324,095 | ) | ||||
| ||||||||
Class S | (295,413 | ) | 1,508,504 | |||||
| ||||||||
Class Y | 3,840,912 | (1,746,025 | ) | |||||
| ||||||||
Class R5 | (916,441 | ) | (861,996 | ) | ||||
| ||||||||
Class R6 | (1,244,679 | ) | (359,119 | ) | ||||
| ||||||||
Net increase (decrease) in net assets resulting from share transactions | (95,317,746 | ) | 102,741,374 | |||||
| ||||||||
Net increase (decrease) in net assets | 661,099,340 | (220,339,834 | ) | |||||
| ||||||||
Net assets: | ||||||||
Beginning of period | 2,985,557,708 | 3,205,897,542 | ||||||
| ||||||||
End of period | $ | 3,646,657,048 | $ | 2,985,557,708 | ||||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco Charter Fund
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains on securities | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return (b) | Net assets, end of period (000’s omitted) | Ratio of | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover (c) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | $ | 15.99 | $ | 0.05 | $ | 4.46 | $ | 4.51 | $ | (0.10 | ) | $ | (0.32 | ) | $ | (0.42 | ) | $ | 20.08 | 28.57 | % | $ | 3,444,665 | 1.04 | %(d) | 1.04 | %(d) | 0.59 | %(d) | 23 | % | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 17.79 | 0.11 | 1.02 | 1.13 | (0.13 | ) | (2.80 | ) | (2.93 | ) | 15.99 | 6.71 | 2,816,198 | 1.07 | 1.07 | 0.70 | 45 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 17.52 | 0.13 | 1.86 | (e) | 1.99 | (0.07 | ) | (1.65 | ) | (1.72 | ) | 17.79 | 12.96 | (e) | 3,007,391 | 1.07 | 1.07 | 0.74 | 82 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 18.75 | 0.06 | (0.04 | ) | 0.02 | (0.10 | ) | (1.15 | ) | (1.25 | ) | 17.52 | (0.04 | ) | 2,951,279 | 1.07 | 1.08 | 0.35 | 46 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.31 | 0.09 | 2.29 | 2.38 | (0.17 | ) | (1.77 | ) | (1.94 | ) | 18.75 | 13.83 | 3,363,073 | 1.10 | 1.11 | 0.50 | 30 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.30 | 0.16 | 0.34 | 0.50 | (0.21 | ) | (2.28 | ) | (2.49 | ) | 18.31 | 3.54 | 3,467,887 | 1.11 | 1.12 | 0.88 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 14.61 | (0.01 | ) | 4.07 | 4.06 | — | (0.32 | ) | (0.32 | ) | 18.35 | 28.11 | 27,090 | 1.79 | (d) | 1.79 | (d) | (0.16 | )(d) | 23 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 16.47 | (0.01 | ) | 0.95 | 0.94 | — | (2.80 | ) | (2.80 | ) | 14.61 | 5.96 | 30,607 | 1.82 | 1.82 | (0.05 | ) | 45 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 16.39 | (0.00 | ) | 1.73 | (e) | 1.73 | — | (1.65 | ) | (1.65 | ) | 16.47 | 12.14 | (e) | 40,493 | 1.82 | 1.82 | (0.01 | ) | 82 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 17.65 | (0.07 | ) | (0.04 | ) | (0.11 | ) | — | (1.15 | ) | (1.15 | ) | 16.39 | (0.80 | ) | 133,804 | 1.82 | 1.83 | (0.40 | ) | 46 | |||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 17.32 | (0.04 | ) | 2.16 | 2.12 | (0.02 | ) | (1.77 | ) | (1.79 | ) | 17.65 | 12.98 | 167,073 | 1.85 | 1.86 | (0.25 | ) | 30 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 19.30 | 0.02 | 0.32 | 0.34 | (0.04 | ) | (2.28 | ) | (2.32 | ) | 17.32 | 2.73 | 200,499 | 1.86 | 1.87 | 0.13 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 15.82 | 0.03 | 4.40 | 4.43 | (0.05 | ) | (0.32 | ) | (0.37 | ) | 19.88 | 28.37 | 19,817 | 1.29 | (d) | 1.29 | (d) | 0.34 | (d) | 23 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 17.62 | 0.07 | 1.01 | 1.08 | (0.08 | ) | (2.80 | ) | (2.88 | ) | 15.82 | 6.46 | 16,500 | 1.32 | 1.32 | 0.45 | 45 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 17.34 | 0.08 | 1.85 | (e) | 1.93 | — | (1.65 | ) | (1.65 | ) | 17.62 | 12.68 | (e) | 19,772 | 1.32 | 1.32 | 0.49 | 82 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 18.55 | 0.02 | (0.04 | ) | (0.02 | ) | (0.04 | ) | (1.15 | ) | (1.19 | ) | 17.34 | (0.24 | ) | 23,251 | 1.32 | 1.33 | 0.10 | 46 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.13 | 0.05 | 2.26 | 2.31 | (0.12 | ) | (1.77 | ) | (1.89 | ) | 18.55 | 13.53 | 30,187 | 1.35 | 1.36 | 0.25 | 30 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.12 | 0.11 | 0.34 | 0.45 | (0.16 | ) | (2.28 | ) | (2.44 | ) | 18.13 | 3.24 | 35,654 | 1.36 | 1.37 | 0.63 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class S | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 16.00 | 0.06 | 4.46 | 4.52 | (0.11 | ) | (0.32 | ) | (0.43 | ) | 20.09 | 28.67 | 20,741 | 0.94 | (d) | 0.94 | (d) | 0.69 | (d) | 23 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 17.80 | 0.13 | 1.02 | 1.15 | (0.15 | ) | (2.80 | ) | (2.95 | ) | 16.00 | 6.82 | 16,783 | 0.97 | 0.97 | 0.80 | 45 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 17.53 | 0.14 | 1.87 | (e) | 2.01 | (0.09 | ) | (1.65 | ) | (1.74 | ) | 17.80 | 13.09 | (e) | 16,906 | 0.97 | 0.97 | 0.84 | 82 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 18.76 | 0.08 | (0.04 | ) | 0.04 | (0.12 | ) | (1.15 | ) | (1.27 | ) | 17.53 | 0.07 | 17,317 | 0.97 | 0.98 | 0.45 | 46 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.32 | 0.11 | 2.28 | 2.39 | (0.18 | ) | (1.77 | ) | (1.95 | ) | 18.76 | 13.94 | 19,028 | 1.00 | 1.01 | 0.60 | 30 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.32 | 0.18 | 0.34 | 0.52 | (0.24 | ) | (2.28 | ) | (2.52 | ) | 18.32 | 3.63 | 18,364 | 1.01 | 1.02 | 0.98 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 16.09 | 0.08 | 4.47 | 4.55 | (0.14 | ) | (0.32 | ) | (0.46 | ) | 20.18 | 28.69 | 106,479 | 0.79 | (d) | 0.79 | (d) | 0.84 | (d) | 23 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 17.88 | 0.15 | 1.04 | 1.19 | (0.18 | ) | (2.80 | ) | (2.98 | ) | 16.09 | 7.03 | 81,404 | 0.82 | 0.82 | 0.95 | 45 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 17.61 | 0.17 | 1.87 | (e) | 2.04 | (0.12 | ) | (1.65 | ) | (1.77 | ) | 17.88 | 13.24 | (e) | 93,143 | 0.82 | 0.82 | 0.99 | 82 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 18.84 | 0.11 | (0.04 | ) | 0.07 | (0.15 | ) | (1.15 | ) | (1.30 | ) | 17.61 | 0.23 | 101,885 | 0.82 | 0.83 | 0.60 | 46 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.39 | 0.14 | 2.29 | 2.43 | (0.21 | ) | (1.77 | ) | (1.98 | ) | 18.84 | 14.13 | 129,285 | 0.85 | 0.86 | 0.75 | 30 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.40 | 0.20 | 0.34 | 0.54 | (0.27 | ) | (2.28 | ) | (2.55 | ) | 18.39 | 3.76 | 102,182 | 0.86 | 0.87 | 1.13 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 16.98 | 0.08 | 4.73 | 4.81 | (0.15 | ) | (0.32 | ) | (0.47 | ) | 21.32 | 28.72 | 8,431 | 0.75 | (d) | 0.75 | (d) | 0.88 | (d) | 23 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 18.71 | 0.17 | 1.09 | 1.26 | (0.19 | ) | (2.80 | ) | (2.99 | ) | 16.98 | 7.11 | 7,511 | 0.76 | 0.76 | 1.01 | 45 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 18.34 | 0.19 | 1.96 | (e) | 2.15 | (0.13 | ) | (1.65 | ) | (1.78 | ) | 18.71 | 13.34 | (e) | 9,163 | 0.75 | 0.75 | 1.06 | 82 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 19.58 | 0.13 | (0.06 | ) | 0.07 | (0.16 | ) | (1.15 | ) | (1.31 | ) | 18.34 | 0.25 | 12,018 | 0.76 | 0.77 | 0.66 | 46 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 19.05 | 0.16 | 2.38 | 2.54 | (0.24 | ) | (1.77 | ) | (2.01 | ) | 19.58 | 14.19 | 29,835 | 0.77 | 0.78 | 0.83 | 30 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 21.03 | 0.23 | 0.36 | 0.59 | (0.29 | ) | (2.28 | ) | (2.57 | ) | 19.05 | 3.92 | 38,682 | 0.75 | 0.76 | 1.24 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 16.97 | 0.09 | 4.72 | 4.81 | (0.16 | ) | (0.32 | ) | (0.48 | ) | 21.30 | 28.76 | 19,433 | 0.68 | (d) | 0.68 | (d) | 0.95 | (d) | 23 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 18.70 | 0.18 | 1.09 | 1.27 | (0.20 | ) | (2.80 | ) | (3.00 | ) | 16.97 | 7.19 | 16,553 | 0.69 | 0.69 | 1.08 | 45 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 18.34 | 0.20 | 1.95 | (e) | 2.15 | (0.14 | ) | (1.65 | ) | (1.79 | ) | 18.70 | 13.38 | (e) | 19,030 | 0.69 | 0.69 | 1.12 | 82 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 19.58 | 0.14 | (0.05 | ) | 0.09 | (0.18 | ) | (1.15 | ) | (1.33 | ) | 18.34 | 0.34 | 20,404 | 0.69 | 0.70 | 0.73 | 46 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 19.05 | 0.17 | 2.38 | 2.55 | (0.25 | ) | (1.77 | ) | (2.02 | ) | 19.58 | 14.27 | 18,290 | 0.69 | 0.70 | 0.91 | 30 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 21.04 | 0.24 | 0.36 | 0.60 | (0.31 | ) | (2.28 | ) | (2.59 | ) | 19.05 | 3.99 | 2,948 | 0.68 | 0.69 | 1.31 | 28 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $3,180,651, $28,210, $18,333, $18,933, $95,628, $8,196 and $18,390 for Class A, Class C, Class R, Class S, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Includes litigation proceeds received during the year ended October 31, 2019. Had these litigation proceeds not been received, Net gains (losses) on securities (both realized and unrealized) per share would have been $1.81, $1.68, $1.80, $1.82, $1.82, $1.91 and $1.90 for Class A, Class C, Class R, Class S, Class Y, Class R5, and Class R6 shares, respectively. Total returns would have been lower. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco Charter Fund
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Charter Fund (the “Fund”) is a series portfolio of AIM Equity Funds (Invesco Equity Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of seven different classes of shares: Class A, Class C, Class R, Class S, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class S, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares would occur at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
12 Invesco Charter Fund
settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date.
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Securities Lending – The Fund may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by collateral equal to no less than the market value of the loaned securities determined daily by the securities lending provider. Such collateral will be cash or debt securities issued or guaranteed by the U.S. Government or any of its sponsored agencies. Cash collateral received in connection with these loans is invested in short-term money market instruments or affiliated money market funds and is shown as such on the Schedule of Investments. The Fund bears the risk of loss with respect to the investment of collateral. It is the Fund’s policy to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be temporarily less than the value of the securities on loan. When loaning securities, the Fund retains certain benefits of owning the securities, including the economic equivalent of dividends or interest generated by the security. Lending securities entails a risk of loss to the Fund if, and to the extent that, the market value of the securities loaned were to increase and the borrower did not increase the collateral accordingly, and the borrower failed to return the securities. The securities loaned are subject to termination at the option of the borrower or the Fund. Upon termination, the borrower will return to the Fund the securities loaned and the Fund will return the collateral. Upon the failure of the borrower to return the securities, collateral may be liquidated and the securities may be purchased on the open market to replace the loaned securities. The Fund could experience delays and costs in gaining access to the collateral and the securities may lose value during the delay which could result in potential losses to the Fund. Some of these losses may be indemnified by the lending agent. The Fund bears the risk of any deficiency in the amount of the collateral available for return to the borrower due to any loss on the collateral invested. Dividends received on cash collateral investments for securities lending transactions, which are net of compensation to counterparties, are included in Dividends from affiliated money market funds on the Statement of Operations. The aggregate value of securities out on loan, if any, is shown as a footnote on the Statement of Assets and Liabilities. |
J. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized |
13 Invesco Charter Fund
foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates.
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
K. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
L. | COVID-19 Risk – The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $250 million | 0.695 | % | ||
Next $4.05 billion | 0.615 | % | ||
Next $3.9 billion | 0.570 | % | ||
Next $1.8 billion | 0.545 | % | ||
Over $10 billion | 0.520 | % |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.62%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2022, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class S, Class Y, Class R5 and Class R6 shares to 2.00%, 2.75%, 2.25%, 1.90%, 1.75%, 1.75% and 1.75%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash (excluding investments of cash collateral from securities lending) in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $5,455.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class S, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C, Class R and Class S shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares, 0.50% of the average daily net assets of Class R shares and 0.15% of the average daily net assets of Class S shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of Class A, Class C and Class R shares and 0.15% of the average daily net assets of Class S shares may be paid to furnish continuing personal shareholder services to customers
14 Invesco Charter Fund
who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $65,325 in front-end sales commissions from the sale of Class A shares and $49 and $590 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $3,648 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 - Prices are determined using quoted prices in an active market for identical assets.
Level 2 - Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others.
Level 3 - Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information.
The following is a summary of the tiered valuation input levels, as of April 30, 2021. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Common Stocks & Other Equity Interests | $3,616,140,744 | $17,113,934 | $- | $3,633,254,678 | ||||||||||||
Money Market Funds | 19,327,377 | 10,093,631 | - | 29,421,008 | ||||||||||||
Total Investments | $3,635,468,121 | $27,207,565 | $- | $3,662,675,686 |
NOTE 4–Security Transactions with Affiliated Funds
The Fund is permitted to purchase or sell securities from or to certain other Invesco Funds under specified conditions outlined in procedures adopted by the Board of Trustees of the Trust. The procedures have been designed to ensure that any purchase or sale of securities by the Fund from or to another fund or portfolio that is or could be considered an affiliate by virtue of having a common investment adviser (or affiliated investment advisers), common Trustees and/or common officers complies with Rule 17a-7 of the 1940 Act. Further, as defined under the procedures, each transaction is effected at the current market price. Pursuant to these procedures, for the six months ended April 30, 2021, the Fund engaged in securities purchases of $6,454,680.
NOTE 5–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $5,972.
NOTE 6–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 7–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
15 Invesco Charter Fund
NOTE 8–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 9–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $765,386,648 and $934,472,643, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
| ||||
Aggregate unrealized appreciation of investments | $ | 1,268,526,023 | ||
| ||||
Aggregate unrealized (depreciation) of investments | (15,107,439 | ) | ||
| ||||
Net unrealized appreciation of investments | $ | 1,253,418,584 | ||
|
Cost of investments for tax purposes is $2,409,257,102.
NOTE 10–Share Information
Summary of Share Activity | ||||||||||||||||
| ||||||||||||||||
Six months ended April 30, 2021(a) | Year ended October 31, 2020 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
| ||||||||||||||||
Sold: | ||||||||||||||||
Class A | 1,432,214 | $ | 26,113,754 | 3,107,192 | $ | 47,322,592 | ||||||||||
| ||||||||||||||||
Class C | 108,374 | 1,787,411 | 304,664 | 4,281,049 | ||||||||||||
| ||||||||||||||||
Class R | 72,267 | 1,319,950 | 192,788 | 2,930,606 | ||||||||||||
| ||||||||||||||||
Class S | 16,121 | 292,666 | 22,585 | 345,715 | ||||||||||||
| ||||||||||||||||
Class Y | 612,028 | 11,183,267 | 1,084,206 | 16,900,822 | ||||||||||||
| ||||||||||||||||
Class R5 | 12,475 | 238,587 | 36,159 | 590,973 | ||||||||||||
| ||||||||||||||||
Class R6 | 74,129 | 1,430,205 | 181,726 | 3,080,832 | ||||||||||||
| ||||||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 3,859,089 | 67,186,741 | 28,971,318 | 454,270,256 | ||||||||||||
| ||||||||||||||||
Class C | 39,494 | 629,924 | 446,613 | 6,440,158 | ||||||||||||
| ||||||||||||||||
Class R | 21,961 | 378,832 | 199,471 | 3,099,775 | ||||||||||||
| ||||||||||||||||
Class S | 24,720 | 430,133 | 177,279 | 2,779,734 | ||||||||||||
| ||||||||||||||||
Class Y | 116,651 | 2,037,894 | 810,898 | 12,763,540 | ||||||||||||
| ||||||||||||||||
Class R5 | 10,946 | 202,069 | 83,399 | 1,384,421 | ||||||||||||
| ||||||||||||||||
Class R6 | 23,073 | 425,471 | 160,751 | 2,665,259 | ||||||||||||
| ||||||||||||||||
Automatic conversion of Class C shares to Class A shares: | ||||||||||||||||
Class A | 516,043 | 9,097,072 | 397,132 | 6,122,635 | ||||||||||||
| ||||||||||||||||
Class C | (563,418 | ) | (9,097,072 | ) | (433,189 | ) | (6,122,635 | ) | ||||||||
| ||||||||||||||||
Reacquired: | ||||||||||||||||
Class A | (10,357,083 | ) | (188,270,284 | ) | (25,466,699 | ) | (397,100,635 | ) | ||||||||
| ||||||||||||||||
Class C | (202,525 | ) | (3,323,387 | ) | (681,362 | ) | (9,689,315 | ) | ||||||||
| ||||||||||||||||
Class R | (140,584 | ) | (2,525,066 | ) | (471,566 | ) | (7,354,476 | ) | ||||||||
| ||||||||||||||||
Class S | (56,912 | ) | (1,018,212 | ) | (101,016 | ) | (1,616,945 | ) | ||||||||
| ||||||||||||||||
Class Y | (512,294 | ) | (9,380,249 | ) | (2,044,528 | ) | (31,410,387 | ) | ||||||||
| ||||||||||||||||
Class R5 | (70,382 | ) | (1,357,097 | ) | (166,775 | ) | (2,837,390 | ) | ||||||||
| ||||||||||||||||
Class R6 | (160,383 | ) | (3,100,355 | ) | (384,400 | ) | (6,105,210 | ) | ||||||||
| ||||||||||||||||
Net increase (decrease) in share activity | (5,123,996 | ) | $ | (95,317,746 | ) | 6,426,646 | $ | 102,741,374 | ||||||||
|
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 26% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
16 Invesco Charter Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, expenses shown in the table do not include the expenses of the underlying funds, which are borne indirectly by the Fund. If transaction costs and indirect expenses were included, your costs would have been higher.
Beginning | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized | |||||||||
Ending Account Value (04/30/21)1 | Expenses Paid During Period2 | Ending Account Value (04/30/21) | Expenses Paid During Period2 | |||||||||
Class A | $1,000.00 | $1,285.70 | $5.89 | $1,019.64 | $5.21 | 1.04% | ||||||
Class C | 1,000.00 | 1,281.10 | 10.12 | 1,015.92 | 8.95 | 1.79 | ||||||
Class R | 1,000.00 | 1,283.70 | 7.30 | 1,018.40 | 6.46 | 1.29 | ||||||
Class S | 1,000.00 | 1,286.70 | 5.33 | 1,020.13 | 4.71 | 0.94 | ||||||
Class Y | 1,000.00 | 1,286.90 | 4.48 | 1,020.88 | 3.96 | 0.79 | ||||||
Class R5 | 1,000.00 | 1,287.20 | 4.25 | 1,021.08 | 3.76 | 0.75 | ||||||
Class R6 | 1,000.00 | 1,287.60 | 3.86 | 1,021.42 | 3.41 | 0.68 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
17 Invesco Charter Fund
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ | Fund reports and prospectuses |
∎ | Quarterly statements |
∎ | Daily confirmations |
∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. | ||
SEC file numbers: 811-01424 and 002-25469 Invesco Distributors, Inc. CHT-SAR-1
| ||||
Semiannual Report to Shareholders
| April 30, 2021
| |||
| ||||
Invesco Diversified Dividend Fund | ||||
Nasdaq: | ||||
A: LCEAX ∎ C: LCEVX ∎ R: DDFRX ∎ Y: LCEYX ∎ Investor: LCEIX ∎ R5: DDFIX ∎ R6: LCEFX |
2 | ||||
4 | ||||
5 | ||||
8 | ||||
11 | ||||
12 | ||||
18 |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Performance summary | ||||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. | ||||
Class A Shares | 28.39 | % | ||
Class C Shares | 27.89 | |||
Class R Shares | 28.18 | |||
Class Y Shares | 28.51 | |||
Investor Class Shares | 28.38 | |||
Class R5 Shares | 28.58 | |||
Class R6 Shares | 28.56 | |||
S&P 500 Index▼ (Broad Market Index) | 28.85 | |||
Russell 1000 Value Index▼ (Style-Specific Index) | 36.30 | |||
Lipper Large-Cap Value Funds Index∎ (Peer Group Index) | 37.01 | |||
Source(s): ▼RIMES Technologies Corp.; ∎Lipper Inc. | ||||
The S&P 500® Index is an unmanaged index considered representative of the US stock market. |
| |||
The Russell 1000® Value Index is an unmanaged index considered representative of large-cap value stocks. The Russell 1000 Value Index is a trademark/service mark of the Frank Russell Co. Russell® is a trademark of the Frank Russell Co. |
| |||
The Lipper Large-Cap Value Funds Index is an unmanaged index considered representative of large-cap value funds tracked by Lipper. |
| |||
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). |
| |||
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
|
For more information about your Fund |
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their in-sights about market and economic news and trends.
|
2 | Invesco Diversified Dividend Fund |
Average Annual Total Returns |
| |||
As of 4/30/21, including maximum applicable sales charges
|
| |||
Class A Shares | ||||
Inception (12/31/01) | 7.69 | % | ||
10 Years | 9.26 | |||
5 Years | 7.30 | |||
| ||||
1 Year | 29.05 | |||
Class C Shares | ||||
Inception (12/31/01) | 7.71 | % | ||
10 Years | 9.22 | |||
5 Years | 7.71 | |||
1 Year | 34.56 | |||
Class R Shares | ||||
Inception (10/25/05) | 8.20 | % | ||
10 Years | 9.60 | |||
5 Years | 8.25 | |||
1 Year | 36.24 | |||
Class Y Shares | ||||
Inception (10/3/08) | 10.16 | % | ||
10 Years | 10.14 | |||
5 Years | 8.79 | |||
1 Year | 36.96 | |||
Investor Class Shares | ||||
Inception (7/15/05) | 8.15 | % | ||
10 Years | 9.92 | |||
5 Years | 8.58 | |||
1 Year | 36.72 | |||
Class R5 Shares | ||||
Inception (10/25/05) | 8.81 | % | ||
10 Years | 10.22 | |||
5 Years | 8.86 | |||
1 Year | 37.00 | |||
Class R6 Shares | ||||
10 Years | 10.25 | % | ||
5 Years | 8.95 | |||
1 Year | 37.12 |
Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares at net asset value and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Investor Class,
Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
3 | Invesco Diversified Dividend Fund |
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 | Invesco Diversified Dividend Fund |
April 30, 2021
(Unaudited)
Shares | Value | |||||
Common Stocks & Other Equity Interests–97.33% | ||||||
Aerospace & Defense–1.47% | ||||||
General Dynamics Corp. | 572,601 | $ 108,925,888 | ||||
Raytheon Technologies Corp. | 1,637,655 | 136,318,402 | ||||
245,244,290 | ||||||
Agricultural & Farm Machinery–0.99% | ||||||
Deere & Co. | 442,542 | 164,116,701 | ||||
Air Freight & Logistics–1.02% | ||||||
United Parcel Service, Inc., Class B | 828,638 | 168,926,144 | ||||
Apparel Retail–1.55% | ||||||
TJX Cos., Inc. (The) | 3,638,076 | 258,303,396 | ||||
Apparel, Accessories & Luxury Goods–0.62% | ||||||
Columbia Sportswear Co. | 944,414 | 102,950,570 | ||||
Brewers–3.77% | ||||||
Anheuser-Busch InBev S.A./N.V. (Belgium) | 3,574,231 | 253,452,863 | ||||
Heineken N.V. (Netherlands) | 3,222,007 | 373,527,269 | ||||
626,980,132 | ||||||
Cable & Satellite–2.32% | ||||||
Comcast Corp., Class A | 6,862,837 | 385,348,297 | ||||
Construction Machinery & Heavy Trucks–0.92% | ||||||
Cummins, Inc. | 608,075 | 153,259,223 | ||||
Consumer Finance–1.48% | ||||||
American Express Co. | 1,605,393 | 246,187,017 | ||||
Data Processing & Outsourced Services–2.69% | ||||||
Automatic Data Processing, Inc. | 1,263,058 | 236,179,215 | ||||
Fidelity National Information Services, Inc. | 1,381,390 | 211,214,531 | ||||
447,393,746 | ||||||
Diversified Banks–2.36% | ||||||
Bank of America Corp. | 9,677,321 | 392,221,820 | ||||
Diversified Chemicals–1.04% | ||||||
BASF SE (Germany) | 2,150,160 | 173,408,607 | ||||
Electric Utilities–6.32% | ||||||
American Electric Power Co., Inc. | 1,845,870 | 163,747,128 | ||||
Duke Energy Corp. | 1,993,424 | 200,717,863 | ||||
Entergy Corp. | 4,329,577 | 473,179,470 | ||||
Exelon Corp. | 4,747,276 | 213,342,583 | ||||
1,050,987,044 | ||||||
Electrical Components & Equipment–2.30% | ||||||
ABB Ltd. (Switzerland) | 7,910,394 | 256,792,740 | ||||
Emerson Electric Co. | 1,388,292 | 125,626,543 | ||||
382,419,283 | ||||||
Fertilizers & Agricultural Chemicals–0.53% | ||||||
Nutrien Ltd. (Canada) | 1,590,348 | 87,788,400 |
Shares | Value | |||||
Food Distributors–0.73% | ||||||
Sysco Corp. | 1,437,428 | $ 121,793,274 | ||||
General Merchandise Stores–1.99% | ||||||
Target Corp. | 1,593,673 | 330,304,666 | ||||
Health Care Equipment–1.74% | ||||||
Medtronic PLC | 2,208,891 | 289,188,010 | ||||
Household Products–2.28% | ||||||
Procter & Gamble Co. (The) | 2,846,226 | 379,743,473 | ||||
Industrial Conglomerates–2.25% 3M Co. | 1,262,766 | 248,941,689 | ||||
Siemens AG (Germany) | 746,854 | 124,648,538 | ||||
373,590,227 | ||||||
Industrial Machinery–3.05% | ||||||
Flowserve Corp. | 6,520,915 | 258,489,071 | ||||
Pentair PLC | 2,813,744 | 181,514,625 | ||||
Stanley Black & Decker, Inc. | 329,725 | 68,177,238 | ||||
508,180,934 | ||||||
Integrated Oil & Gas–2.63% | ||||||
Suncor Energy, Inc. (Canada) | 5,178,071 | 110,752,542 | ||||
TOTAL SE (France)(b) | 7,388,270 | 327,100,040 | ||||
437,852,582 | ||||||
Integrated Telecommunication Services–2.81% | ||||||
AT&T, Inc. | 8,766,369 | 275,351,650 | ||||
Deutsche Telekom AG (Germany) | 10,000,459 | 192,617,506 | ||||
467,969,156 | ||||||
Investment Banking & Brokerage–0.89% | ||||||
Charles Schwab Corp. (The) | 2,097,202 | 147,643,021 | ||||
IT Consulting & Other Services–1.49% | ||||||
International Business Machines Corp. | 1,742,088 | 247,167,445 | ||||
Motorcycle Manufacturers–1.52% | ||||||
Harley-Davidson, Inc. | 5,236,099 | 253,270,109 | ||||
Movies & Entertainment–1.08% | ||||||
Walt Disney Co. (The)(c) | 964,748 | 179,462,423 | ||||
Multi-line Insurance–2.79% | ||||||
Hartford Financial Services Group, Inc. (The) | 7,026,285 | 463,453,759 | ||||
Multi-Utilities–4.82% | ||||||
Consolidated Edison, Inc. | 1,655,171 | 128,126,787 | ||||
Dominion Energy, Inc. | 5,298,582 | 423,356,702 | ||||
Sempra Energy | 1,815,244 | 249,723,117 | ||||
801,206,606 | ||||||
Oil & Gas Equipment & Services–0.41% | ||||||
Baker Hughes Co., Class A | 3,421,008 | 68,693,841 | ||||
Oil & Gas Exploration & Production–1.63% | ||||||
ConocoPhillips | 5,287,455 | 270,400,449 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 | Invesco Diversified Dividend Fund |
Shares | Value | |||||
Packaged Foods & Meats–8.60% |
| |||||
Campbell Soup Co. | 6,385,817 | $ 304,922,762 | ||||
General Mills, Inc. | 6,239,219 | 379,718,868 | ||||
Kraft Heinz Co. (The) | 5,532,724 | 228,446,174 | ||||
Mondelez International, Inc., Class A | 4,186,415 | 254,575,896 | ||||
Nestle S.A. (Switzerland) | 2,199,771 | 262,251,308 | ||||
1,429,915,008 | ||||||
Paper Packaging–2.96% | ||||||
Avery Dennison Corp. | 632,582 | 135,480,087 | ||||
International Paper Co. | 3,617,250 | 209,800,500 | ||||
Sonoco Products Co. | 2,244,186 | 146,904,415 | ||||
492,185,002 | ||||||
Personal Products–1.27% | ||||||
L’Oreal S.A. (France) | 514,092 | 211,132,580 | ||||
Pharmaceuticals–6.56% | ||||||
Bayer AG (Germany) | 2,100,036 | 135,848,746 | ||||
Bristol-Myers Squibb Co. | 2,855,459 | 178,237,751 | ||||
Eli Lilly and Co. | 1,355,546 | 247,753,142 | ||||
Johnson & Johnson | 1,790,662 | 291,394,427 | ||||
Merck & Co., Inc. | 3,189,825 | 237,641,963 | ||||
1,090,876,029 | ||||||
Property & Casualty Insurance–1.97% |
| |||||
Travelers Cos., Inc. (The) | 2,120,063 | 327,888,944 | ||||
Regional Banks–8.90% | ||||||
Comerica, Inc. | 3,666,679 | 275,587,594 | ||||
Cullen/Frost Bankers, Inc. | 1,540,020 | 184,894,801 | ||||
Fifth Third Bancorp | 4,733,914 | 191,912,873 | ||||
M&T Bank Corp. | 2,238,958 | 353,061,287 | ||||
PNC Financial Services Group, Inc. (The) | 967,585 | 180,890,015 | ||||
Zions Bancorporation N.A. | 5,281,577 | 294,711,997 | ||||
1,481,058,567 | ||||||
Restaurants–0.34% | ||||||
Darden Restaurants, Inc. | 382,596 | 56,134,485 | ||||
Semiconductors–0.99% | ||||||
Broadcom, Inc. | 359,636 | 164,065,943 |
Investment Abbreviations:
REIT – Real Estate Investment Trust
Shares | Value | |||||
Soft Drinks–1.96% | ||||||
Coca-Cola Co. (The) | 6,029,211 | $ 325,456,810 | ||||
Specialized REITs–1.20% | ||||||
Weyerhaeuser Co. | 5,147,312 | 199,561,286 | ||||
Specialty Chemicals–1.09% | ||||||
DuPont de Nemours, Inc. | 2,362,434 | 182,167,286 | ||||
Total Common Stocks & Other Equity Interests |
| 16,185,896,585 | ||||
Money Market Funds–2.68% | ||||||
Invesco Government & Agency Portfolio, Institutional Class, 0.03%(d)(e) | 160,617,274 | 160,617,274 | ||||
Invesco Liquid Assets Portfolio, Institutional Class, 0.01%(d)(e) | 110,350,551 | 110,394,692 | ||||
Invesco Treasury Portfolio, Institutional Class, 0.01%(d)(e) | 174,193,655 | 174,193,655 | ||||
Total Money Market Funds | 445,205,621 | |||||
TOTAL INVESTMENTS IN SECURITIES (excluding investments purchased with cash collateral from securities on loan)-100.01% |
| 16,631,102,206 | ||||
Investments Purchased with Cash Collateral from Securities on Loan | ||||||
Money Market Funds–0.72% | ||||||
Invesco Private Government Fund, 0.01%(d)(e)(f) | 48,133,800 | 48,133,800 | ||||
Invesco Private Prime Fund, 0.11%(d)(e)(f) | 72,171,832 | 72,200,701 | ||||
Total Investments Purchased with Cash Collateral from Securities on Loan |
| 120,334,501 | ||||
TOTAL INVESTMENTS IN SECURITIES–100.73% |
| 16,751,436,707 | ||||
OTHER ASSETS LESS LIABILITIES–(0.73)% |
| (120,699,137) | ||||
NET ASSETS–100.00% |
| $16,630,737,570 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 | Invesco Diversified Dividend Fund |
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | All or a portion of this security was out on loan at April 30, 2021. |
(c) | Non-income producing security. |
(d) | Affiliated issuer. The issuer is affiliated by having an investment adviser that is under common control of Invesco Ltd. and/or the Investment Company Act of 1940, as amended (the “1940 Act”), defines “affiliated person” to include an issuer of which a fund holds 5% or more of the outstanding voting securities. The Fund has not owned enough of the outstanding voting securities of the issuer to have control (as defined in the 1940 Act) of that issuer. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
Value October 31, 2020 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation (Depreciation) | Realized (Loss) | Value April 30, 2021 | Dividend Income | ||||||||||||||||||||
Investments in Affiliated Money Market Funds: | ||||||||||||||||||||||||||
Invesco Government & Agency Portfolio, Institutional Class | $135,656,121 | $ | 401,038,530 | $ | (376,077,377 | ) | $ | - | $ | - | $ | 160,617,274 | $ 19,158 | |||||||||||||
Invesco Liquid Assets Portfolio, Institutional Class | 92,565,398 | 286,456,093 | (268,626,696 | ) | (23,644 | ) | 23,541 | 110,394,692 | 23,175 | |||||||||||||||||
Invesco Treasury Portfolio, Institutional Class | 145,666,623 | 458,329,749 | (429,802,717 | ) | - | - | 174,193,655 | 8,419 | ||||||||||||||||||
Investments Purchased with Cash Collateral from Securities on Loan: | ||||||||||||||||||||||||||
Invesco Private Government Fund | 6,232 | 389,854,409 | (341,726,841 | ) | - | - | 48,133,800 | 3,633* | ||||||||||||||||||
Invesco Private Prime Fund | 9,410 | 581,107,779 | (508,937,790 | ) | - | 21,302 | 72,200,701 | 37,491* | ||||||||||||||||||
Investments in Other Affiliates: | ||||||||||||||||||||||||||
Flowserve Corp.** | 201,897,667 | 1,494,017 | (16,013,917 | ) | 75,670,601 | (4,559,297 | ) | 258,489,071 | 2,643,057 | |||||||||||||||||
Total | $575,801,451 | $ | 2,118,280,577 | $ | (1,941,185,338 | ) | $ | 75,646,957 | $ | (4,514,454 | ) | $ | 824,029,193 | $2,734,933 |
* | Represents the income earned on the investment of cash collateral, which is included in securities lending income on the Statement of Operations. Does not include rebates and fees paid to lending agent or premiums received from borrowers, if any. |
** | As of April 30, 2021, this security was not considered as an affiliate of the Fund. |
(e) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
(f) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 1I. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
Consumer Staples | 18.61 | % | ||
Financials | 18.39 | |||
Industrials | 12.00 | |||
Utilities | 11.14 | |||
Health Care | 8.30 | |||
Communication Services | 6.21 | |||
Consumer Discretionary | 6.02 | |||
Materials | 5.63 | |||
Information Technology | 5.16 | |||
Energy | 4.67 | |||
Real Estate | 1.20 | |||
Money Market Funds Plus Other Assets Less Liabilities | 2.67 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 | Invesco Diversified Dividend Fund |
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
Assets: | ||
Investments in securities, at value | $16,185,896,585 | |
Investments in affiliated money market funds, at value (Cost $565,529,715) | 565,540,122 | |
Foreign currencies, at value (Cost $15,477,944) | 15,414,523 | |
Receivable for: | ||
Fund shares sold | 26,048,582 | |
Dividends | 35,256,701 | |
Investment for trustee deferred compensation and retirement plans | 866,506 | |
Other assets | 147,683 | |
Total assets | 16,829,170,702 | |
Liabilities: | ||
Payable for: | ||
Fund shares reacquired | 63,964,195 | |
Amount due custodian | 5,302,865 | |
Collateral upon return of securities loaned | 120,334,501 | |
Accrued fees to affiliates | 5,863,230 | |
Accrued trustees’ and officers’ fees and benefits | 1,342 | |
Accrued other operating expenses | 1,864,541 | |
Trustee deferred compensation and retirement plans | 1,102,458 | |
Total liabilities | 198,433,132 | |
Net assets applicable to shares outstanding | $16,630,737,570 | |
Net assets consist of: | ||
Shares of beneficial interest | $10,398,167,778 | |
Distributable earnings | 6,232,569,792 | |
$16,630,737,570 |
Net Assets: | ||||
Class A | $ | 4,338,360,194 | ||
Class C | $ | 302,070,316 | ||
Class R | $ | 205,358,385 | ||
Class Y | $ | 1,798,557,190 | ||
Investor Class | $ | 1,772,762,472 | ||
Class R5 | $ | 3,607,970,368 | ||
Class R6 | $ | 4,605,658,645 | ||
Shares outstanding, no par value, with an unlimited number of shares authorized: |
| |||
Class A | 194,554,937 | |||
Class C | 13,734,544 | |||
Class R | 9,176,306 | |||
Class Y | 80,566,946 | |||
Investor Class | 79,522,435 | |||
Class R5 | 161,799,013 | |||
Class R6 | 206,521,997 | |||
Class A: | ||||
Net asset value per share | $ | 22.30 | ||
Maximum offering price per share | $ | 23.60 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 21.99 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 22.38 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 22.32 | ||
Investor Class: | ||||
Net asset value and offering price per share | $ | 22.29 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 22.30 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 22.30 |
* | At April 30, 2021, a security with a value of $112,895,862 was on loan to brokers. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 | Invesco Diversified Dividend Fund |
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
Investment income: | ||||
Dividends (net of foreign withholding taxes of $7,653,637) | $ | 218,540,921 | ||
| ||||
Dividends from affiliates (includes securities lending income of $1,290,663) | 3,984,472 | |||
| ||||
Total investment income | 222,525,393 | |||
| ||||
Expenses: | ||||
Advisory fees | 31,279,670 | |||
| ||||
Administrative services fees | 1,089,607 | |||
| ||||
Custodian fees | 230,923 | |||
| ||||
Distribution fees: | ||||
Class A | 5,043,790 | |||
| ||||
Class C | 1,531,502 | |||
| ||||
Class R | 485,439 | |||
| ||||
Investor Class | 1,175,567 | |||
| ||||
Transfer agent fees — A, C, R, Y and Investor | 5,854,407 | |||
| ||||
Transfer agent fees — R5 | 1,740,612 | |||
| ||||
Transfer agent fees — R6 | 133,359 | |||
| ||||
Trustees’ and officers’ fees and benefits | 165,173 | |||
| ||||
Registration and filing fees | 117,198 | |||
| ||||
Reports to shareholders | 540,649 | |||
| ||||
Professional services fees | 81,385 | |||
| ||||
Other | 345,544 | |||
| ||||
Total expenses | 49,814,825 | |||
| ||||
Less: Fees waived and/or expense offset arrangement(s) | (162,520 | ) | ||
| ||||
Net expenses | 49,652,305 | |||
| ||||
Net investment income | 172,873,088 | |||
| ||||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Unaffiliated investment securities | 615,786,547 | |||
| ||||
Affiliated investment securities | (4,514,454 | ) | ||
| ||||
Foreign currencies | 7,867,814 | |||
| ||||
Forward foreign currency contracts | (17,324,781 | ) | ||
| ||||
601,815,126 | ||||
| ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Unaffiliated investment securities | 3,084,132,797 | |||
| ||||
Affiliated investment securities | 75,646,957 | |||
| ||||
Foreign currencies | (527,465 | ) | ||
| ||||
Forward foreign currency contracts | (8,662,765 | ) | ||
| ||||
3,150,589,524 | ||||
| ||||
Net realized and unrealized gain | 3,752,404,650 | |||
| ||||
Net increase in net assets resulting from operations | $ | 3,925,277,738 | ||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 | Invesco Diversified Dividend Fund |
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
April 30, 2021 | October 31, 2020 | |||||||
| ||||||||
Operations: | ||||||||
Net investment income | $ | 172,873,088 | $ | 411,664,161 | ||||
| ||||||||
Net realized gain | 601,815,126 | 227,844,209 | ||||||
| ||||||||
Change in net unrealized appreciation (depreciation) | 3,150,589,524 | (2,156,827,682 | ) | |||||
| ||||||||
Net increase (decrease) in net assets resulting from operations | 3,925,277,738 | (1,517,319,312 | ) | |||||
| ||||||||
Distributions to shareholders from distributable earnings: | ||||||||
Class A | (102,522,974 | ) | (238,457,075 | ) | ||||
| ||||||||
Class C | (7,149,652 | ) | (19,083,903 | ) | ||||
| ||||||||
Class R | (4,746,662 | ) | (11,330,789 | ) | ||||
| ||||||||
Class Y | (47,193,848 | ) | (126,994,138 | ) | ||||
| ||||||||
Investor Class | (43,259,677 | ) | (90,897,565 | ) | ||||
| ||||||||
Class R5 | (94,417,671 | ) | (201,408,557 | ) | ||||
| ||||||||
Class R6 | (122,697,603 | ) | (278,868,056 | ) | ||||
| ||||||||
Total distributions from distributable earnings | (421,988,087 | ) | (967,040,083 | ) | ||||
| ||||||||
Share transactions–net: | ||||||||
Class A | (153,018,765 | ) | (823,664,196 | ) | ||||
| ||||||||
Class C | (67,549,573 | ) | (89,454,072 | ) | ||||
| ||||||||
Class R | (17,181,716 | ) | (45,872,466 | ) | ||||
| ||||||||
Class Y | (179,099,402 | ) | (626,788,947 | ) | ||||
| ||||||||
Investor Class | (85,262,589 | ) | (90,696,857 | ) | ||||
| ||||||||
Class R5 | (266,265,599 | ) | (311,167,173 | ) | ||||
| ||||||||
Class R6 | (395,246,697 | ) | (415,240,194 | ) | ||||
| ||||||||
Net increase (decrease) in net assets resulting from share transactions | (1,163,624,341 | ) | (2,402,883,905 | ) | ||||
| ||||||||
Net increase (decrease) in net assets | 2,339,665,310 | (4,887,243,300 | ) | |||||
| ||||||||
Net assets: | ||||||||
Beginning of period | 14,291,072,260 | 19,178,315,560 | ||||||
| ||||||||
End of period | $ | 16,630,737,570 | $ | 14,291,072,260 | ||||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 | Invesco Diversified Dividend Fund |
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Ratio of | Ratio of | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
expenses | expenses | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net gains | to average | to average net | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(losses) | net assets | assets without | Ratio of net | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net asset | on securities | Dividends | Distributions | with fee waivers | fee waivers | investment | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
value, | Net | (both | Total from | from net | from net | Net asset | Net assets, | and/or | and/or | income | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
beginning | investment | realized and | investment | investment | realized | Total | value, end | Total | end of period | expenses | expenses | to average | Portfolio | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
of period | income(a) | unrealized) | operations | income | gains | distributions | of period | return (b) | (000’s omitted) | absorbed | absorbed | net assets | turnover (c) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | $ | 17.82 | $ | 0.20 | $ | 4.79 | $ | 4.99 | $ | (0.21 | ) | $ | (0.30 | ) | $ | (0.51 | ) | $ | 22.30 | 28.39 | % | $ | 4,338,360 | 0.83 | %(d) | 0.83 | %(d) | 1.97 | %(d) | 10 | % | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 20.50 | 0.43 | (2.07 | ) | (1.64 | ) | (0.46 | ) | (0.58 | ) | (1.04 | ) | 17.82 | (8.28 | ) | 3,599,794 | 0.83 | 0.83 | 2.30 | 8 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 19.55 | 0.47 | 1.89 | 2.36 | (0.51 | ) | (0.90 | ) | (1.41 | ) | 20.50 | 12.94 | 4,995,726 | 0.81 | 0.82 | 2.45 | 5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.18 | 0.44 | (0.49 | ) | (0.05 | ) | (0.43 | ) | (0.15 | ) | (0.58 | ) | 19.55 | (0.28 | ) | 4,979,893 | 0.79 | 0.80 | 2.17 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.83 | 0.37 | 1.79 | 2.16 | (0.34 | ) | (0.47 | ) | (0.81 | ) | 20.18 | 11.65 | 6,029,664 | 0.80 | 0.82 | 1.85 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 18.78 | 0.33 | 0.76 | 1.09 | (0.31 | ) | (0.73 | ) | (1.04 | ) | 18.83 | 6.27 | 5,985,548 | 0.80 | 0.82 | 1.79 | 11 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 17.58 | 0.12 | 4.73 | 4.85 | (0.14 | ) | (0.30 | ) | (0.44 | ) | 21.99 | 27.89 | 302,070 | 1.58 | (d) | 1.58 | (d) | 1.22 | (d) | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 20.22 | 0.29 | (2.04 | ) | (1.75 | ) | (0.31 | ) | (0.58 | ) | (0.89 | ) | 17.58 | (8.96 | ) | 300,883 | 1.58 | 1.58 | 1.55 | 8 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 19.30 | 0.32 | 1.86 | 2.18 | (0.36 | ) | (0.90 | ) | (1.26 | ) | 20.22 | 12.08 | 449,838 | 1.56 | 1.57 | 1.70 | 5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 19.92 | 0.28 | (0.47 | ) | (0.19 | ) | (0.28 | ) | (0.15 | ) | (0.43 | ) | 19.30 | (1.01 | ) | 634,394 | 1.54 | 1.55 | 1.42 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.59 | 0.21 | 1.77 | 1.98 | (0.18 | ) | (0.47 | ) | (0.65 | ) | 19.92 | 10.84 | 840,125 | 1.55 | 1.57 | 1.10 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 18.56 | 0.19 | 0.74 | 0.93 | (0.17 | ) | (0.73 | ) | (0.90 | ) | 18.59 | 5.41 | 778,829 | 1.55 | 1.57 | 1.04 | 11 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 17.89 | 0.18 | 4.80 | 4.98 | (0.19 | ) | (0.30 | ) | (0.49 | ) | 22.38 | 28.18 | 205,358 | 1.08 | (d) | 1.08 | (d) | 1.72 | (d) | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 20.57 | 0.38 | (2.07 | ) | (1.69 | ) | (0.41 | ) | (0.58 | ) | (0.99 | ) | 17.89 | (8.48 | ) | 179,293 | 1.08 | 1.08 | 2.05 | 8 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 19.61 | 0.43 | 1.89 | 2.32 | (0.46 | ) | (0.90 | ) | (1.36 | ) | 20.57 | 12.69 | 255,482 | 1.06 | 1.07 | 2.20 | 5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.24 | 0.39 | (0.49 | ) | (0.10 | ) | (0.38 | ) | (0.15 | ) | (0.53 | ) | 19.61 | (0.52 | ) | 306,070 | 1.04 | 1.05 | 1.92 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.88 | 0.32 | 1.80 | 2.12 | (0.29 | ) | (0.47 | ) | (0.76 | ) | 20.24 | 11.40 | 358,418 | 1.05 | 1.07 | 1.60 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 18.84 | 0.28 | 0.75 | 1.03 | (0.26 | ) | (0.73 | ) | (0.99 | ) | 18.88 | 5.93 | 237,638 | 1.05 | 1.07 | 1.54 | 11 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 17.84 | 0.23 | 4.79 | 5.02 | (0.24 | ) | (0.30 | ) | (0.54 | ) | 22.32 | 28.51 | 1,798,557 | 0.58 | (d) | 0.58 | (d) | 2.22 | (d) | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 20.53 | 0.48 | (2.08 | ) | (1.60 | ) | (0.51 | ) | (0.58 | ) | (1.09 | ) | 17.84 | (8.07 | ) | 1,589,496 | 0.58 | 0.58 | 2.55 | 8 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 19.57 | 0.52 | 1.90 | 2.42 | (0.56 | ) | (0.90 | ) | (1.46 | ) | 20.53 | 13.27 | 2,547,134 | 0.56 | 0.57 | 2.70 | 5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.20 | 0.49 | (0.49 | ) | 0.00 | (0.48 | ) | (0.15 | ) | (0.63 | ) | 19.57 | (0.03 | ) | 2,844,688 | 0.54 | 0.55 | 2.42 | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.85 | 0.42 | 1.79 | 2.21 | (0.39 | ) | (0.47 | ) | (0.86 | ) | 20.20 | 11.93 | 4,278,325 | 0.55 | 0.57 | 2.10 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 18.80 | 0.38 | 0.75 | 1.13 | (0.35 | ) | (0.73 | ) | (1.08 | ) | 18.85 | 6.53 | 3,670,662 | 0.55 | 0.57 | 2.04 | 11 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Investor Class |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 17.82 | 0.21 | 4.78 | 4.99 | (0.22 | ) | (0.30 | ) | (0.52 | ) | 22.29 | 28.38 | 1,772,762 | 0.72 | (d)(e) | 0.72 | (d)(e) | 2.08 | (d)(e) | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 20.49 | 0.44 | (2.06 | ) | (1.62 | ) | (0.47 | ) | (0.58 | ) | (1.05 | ) | 17.82 | (8.17 | )(e) | 1,489,011 | 0.77 | (e) | 0.77 | (e) | 2.36 | (e) | 8 | |||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 19.54 | 0.49 | 1.88 | 2.37 | (0.52 | ) | (0.90 | ) | (1.42 | ) | 20.49 | 13.00 | (e) | 1,817,251 | 0.74 | (e) | 0.75 | (e) | 2.52 | (e) | 5 | |||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.16 | 0.45 | (0.48 | ) | (0.03 | ) | (0.44 | ) | (0.15 | ) | (0.59 | ) | 19.54 | (0.19 | )(e) | 1,815,421 | 0.74 | (e) | 0.75 | (e) | 2.22 | (e) | 10 | |||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.81 | 0.37 | 1.79 | 2.16 | (0.34 | ) | (0.47 | ) | (0.81 | ) | 20.16 | 11.69 | (e) | 2,113,750 | 0.75 | (e) | 0.77 | (e) | 1.90 | (e) | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 18.77 | 0.33 | 0.76 | 1.09 | (0.32 | ) | (0.73 | ) | (1.05 | ) | 18.81 | 6.29 | (e) | 2,114,404 | 0.76 | (e) | 0.78 | (e) | 1.83 | (e) | 11 | |||||||||||||||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 17.82 | 0.23 | 4.80 | 5.03 | (0.25 | ) | (0.30 | ) | (0.55 | ) | 22.30 | 28.58 | 3,607,970 | 0.53 | (d) | 0.53 | (d) | 2.27 | (d) | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 20.50 | 0.49 | (2.07 | ) | (1.58 | ) | (0.52 | ) | (0.58 | ) | (1.10 | ) | 17.82 | (7.98 | ) | 3,107,721 | 0.52 | 0.52 | 2.61 | 8 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 19.55 | 0.54 | 1.88 | 2.42 | (0.57 | ) | (0.90 | ) | (1.47 | ) | 20.50 | 13.29 | 3,915,168 | 0.50 | 0.51 | 2.76 | 5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.18 | 0.50 | (0.49 | ) | 0.01 | (0.49 | ) | (0.15 | ) | (0.64 | ) | 19.55 | 0.02 | 3,715,586 | 0.50 | 0.51 | 2.46 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.83 | 0.43 | 1.79 | 2.22 | (0.40 | ) | (0.47 | ) | (0.87 | ) | 20.18 | 11.99 | 3,845,848 | 0.49 | 0.51 | 2.16 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 18.78 | 0.39 | 0.76 | 1.15 | (0.37 | ) | (0.73 | ) | (1.10 | ) | 18.83 | 6.59 | 3,410,571 | 0.50 | 0.52 | 2.09 | 11 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 17.83 | 0.24 | 4.78 | 5.02 | (0.25 | ) | (0.30 | ) | (0.55 | ) | 22.30 | 28.56 | 4,605,659 | 0.44 | (d) | 0.44 | (d) | 2.36 | (d) | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 20.51 | 0.50 | (2.07 | ) | (1.57 | ) | (0.53 | ) | (0.58 | ) | (1.11 | ) | 17.83 | (7.88 | ) | 4,024,875 | 0.43 | 0.43 | 2.70 | 8 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 19.55 | 0.55 | 1.90 | 2.45 | (0.59 | ) | (0.90 | ) | (1.49 | ) | 20.51 | 13.44 | 5,197,717 | 0.41 | 0.42 | 2.85 | 5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.19 | 0.51 | (0.49 | ) | 0.02 | (0.51 | ) | (0.15 | ) | (0.66 | ) | 19.55 | 0.07 | 5,905,494 | 0.40 | 0.41 | 2.56 | 10 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.83 | 0.45 | 1.79 | 2.24 | (0.41 | ) | (0.47 | ) | (0.88 | ) | 20.19 | 12.15 | 6,344,022 | 0.39 | 0.41 | 2.26 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 18.79 | 0.41 | 0.74 | 1.15 | (0.38 | ) | (0.73 | ) | (1.11 | ) | 18.83 | 6.63 | 2,620,298 | 0.40 | 0.42 | 2.19 | 11 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $4,068,472, $308,839, $195,785, $1,768,527, $1,683,280, $3,509,983 and $4,480,197 for Class A, Class C, Class R, Class Y, Investor Class, Class R5 and Class R6 shares, respectively. |
(e) | The total return, ratio of expenses to average net assets and ratio of net investment income (loss) to average net assets reflect actual 12b-1 fees of 0.14%, 0.19%, 0.18%, 0.20%, 0.20% and 0.21% for the six months ended April 30, 2021 and for the years ended October 31, 2020, 2019, 2018, 2017 and 2016, respectively. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 | Invesco Diversified Dividend Fund |
April 30, 2021
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Diversified Dividend Fund (the “Fund”) is a series portfolio of AIM Equity Funds (Invesco Equity Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital and, secondarily, current income.
The Fund currently consists of seven different classes of shares: Class A, Class C, Class R, Class Y, Investor Class, Class R5 and Class R6. Class Y and Investor Class shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Investor Class, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
12 | Invesco Diversified Dividend Fund |
settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions - Distributions from net investment income, if any, are declared and paid quarterly and are recorded on the ex-dividend date. Distributions from net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes –The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Securities Lending – The Fund may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by collateral equal to no less than the market value of the loaned securities determined daily by the securities lending provider. Such collateral will be cash or debt securities issued or guaranteed by the U.S. Government or any of its sponsored agencies. Cash collateral received in connection with these loans is invested in short-term money market instruments or affiliated money market funds and is shown as such on the Schedule of Investments. The Fund bears the risk of loss with respect to the investment of collateral. It is the Fund’s policy to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be temporarily less than the value of the securities on loan. When loaning securities, the Fund retains certain benefits of owning the securities, including the economic equivalent of dividends or interest generated by the security. Lending securities entails a risk of loss to the Fund if, and to the extent that, the market value of the securities loaned were to increase and the borrower did not increase the collateral accordingly, and the borrower failed to return the securities. The securities loaned are subject to termination at the option of the borrower or the Fund. Upon termination, the borrower will return to the Fund the securities loaned and the Fund will return the collateral. Upon the failure of the borrower to return the securities, collateral may be liquidated and the securities may be purchased on the open market to replace the loaned securities. The Fund could experience delays and costs in gaining access to the collateral and the securities may lose value during the delay which could result in potential losses to the Fund. Some of these losses may be indemnified by the lending agent. The Fund bears the risk of any deficiency in the amount of the collateral available for return to the borrower due to any loss on the collateral invested. Dividends received on cash collateral investments for securities lending transactions, which are net of compensation to counterparties, are included in Dividends from affiliated money market funds on the Statement of Operations. The aggregate value of securities out on loan, if any, is shown as a footnote on the Statement of Assets and Liabilities. |
J. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized |
13 | Invesco Diversified Dividend Fund |
foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
K. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
L. | COVID-19 Risk - The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
| ||||
First $ 350 million | 0.600% | |||
| ||||
Next $350 million | 0.550% | |||
| ||||
Next $1.3 billion | 0.500% | |||
| ||||
Next $2 billion | 0.450% | |||
| ||||
Next $2 billion | 0.400% | |||
| ||||
Next $2 billion | 0.375% | |||
| ||||
Over $8 billion | 0.350% | |||
|
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.39%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2022, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Investor Class, Class R5 and Class R6 shares to 2.00%, 2.75%, 2.25%, 1.75%, 2.00%, 1.75% and 1.75%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash (excluding investments of cash collateral from securities lending) in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $157,833.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Investor Class, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C, Class R and Investor Class shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The
14 | Invesco Diversified Dividend Fund |
Fund, pursuant to the Investor Class Plan, reimburses IDI for its allocated share of expenses incurred pursuant to the Investor Class Plan for the period, up to a maximum annual rate of 0.25% of the average daily net assets of Investor Class shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six monthsended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $234,457 in front-end sales commissions from the sale of Class A shares and $7,766 and $4,968 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $6,319 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 | - | Prices are determined using quoted prices in an active market for identical assets. | ||
Level 2 | - | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. | ||
Level 3 | - | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| ||||||||||||||||
Investments in Securities | ||||||||||||||||
| ||||||||||||||||
Common Stocks & Other Equity Interests | $13,875,116,388 | $2,310,780,197 | $— | $16,185,896,585 | ||||||||||||
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Money Market Funds | 445,205,621 | 120,334,501 | — | 565,540,122 | ||||||||||||
| ||||||||||||||||
Total Investments | $14,320,322,009 | $2,431,114,698 | $— | $16,751,436,707 | ||||||||||||
|
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Statement of Assets and Liabilities.
Effect of Derivative Investments for the six months ended April 30, 2021
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Statement of Operations | ||
Currency | ||
Risk | ||
Realized Gain (Loss): | $(17,324,781) | |
| ||
Change in Net Unrealized Appreciation (Depreciation): | (8,662,765) | |
| ||
Total | $(25,987,546) | |
|
The table below summarizes the average notional value of derivatives held during the period.
Forward | ||
Foreign Currency | ||
Contracts | ||
Average notional value | $604,773,149 | |
|
15 | Invesco Diversified Dividend Fund |
NOTE 5—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $4,687.
NOTE 6—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 7—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 8—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 9—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $1,600,689,434 and $3,029,444,783, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
| ||||
Aggregate unrealized appreciation of investments | $ | 5,758,864,771 | ||
| ||||
Aggregate unrealized (depreciation) of investments | (167,438,552 | ) | ||
| ||||
Net unrealized appreciation of investments | $ | 5,591,426,219 | ||
|
Cost of investments for tax purposes is $11,160,010,488.
NOTE 10—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2021(a) | Year ended October 31, 2020 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 8,454,418 | $ | 173,738,676 | 25,607,546 | $ | 465,244,711 | ||||||||||
Class C | 519,533 | 10,511,922 | 2,496,922 | 45,256,042 | ||||||||||||
Class R | 736,395 | 15,171,356 | 1,822,137 | 33,168,559 | ||||||||||||
Class Y | 10,099,094 | 206,113,707 | 28,615,278 | 521,499,195 | ||||||||||||
Investor Class | 1,307,589 | 26,654,364 | 2,489,485 | 45,952,758 | ||||||||||||
Class R5 | 11,680,165 | 237,687,687 | 21,645,258 | 392,436,359 | ||||||||||||
Class R6 | 17,811,571 | 365,434,161 | 70,483,352 | 1,342,738,444 | ||||||||||||
Issued as reinvestment of dividend’s: | ||||||||||||||||
Class A | 4,691,299 | 93,983,089 | 11,551,741 | 221,324,807 | ||||||||||||
Class C | 325,057 | 6,395,086 | 892,455 | 17,063,251 | ||||||||||||
Class R | 236,232 | 4,745,424 | 589,163 | 11,328,629 | ||||||||||||
Class Y | 1,976,741 | 39,610,287 | 5,440,842 | 103,836,227 | ||||||||||||
Investor Class | 1,970,351 | 39,464,352 | 4,436,977 | 84,618,975 | ||||||||||||
Class R5 | 4,707,516 | 94,359,283 | 10,599,545 | 201,296,518 | ||||||||||||
Class R6 | 6,049,591 | 121,282,322 | 14,614,461 | 275,773,873 |
16 | Invesco Diversified Dividend Fund |
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2021(a) | Year ended October 31, 2020 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Automatic conversion of Class C shares to Class A shares: | ||||||||||||||||
Class A | 2,008,566 | $ | 40,566,371 | 1,370,205 | $ | 24,950,034 | ||||||||||
Class C | (2,035,260 | ) | (40,566,371 | ) | (1,388,871 | ) | (24,950,034 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (22,561,317 | ) | (461,306,901 | ) | (80,239,126 | ) | (1,535,183,748 | ) | ||||||||
Class C | (2,185,397 | ) | (43,890,210 | ) | (7,133,744 | ) | (126,823,331 | ) | ||||||||
Class R | (1,819,603 | ) | (37,098,496 | ) | (4,808,776 | ) | (90,369,654 | ) | ||||||||
Class Y | (20,589,597 | ) | (424,823,396 | ) | (69,068,270 | ) | (1,252,124,369 | ) | ||||||||
Investor Class | (7,328,778 | ) | (151,381,305 | ) | (12,024,735 | ) | (221,268,590 | ) | ||||||||
Class R5 | (28,944,762 | ) | (598,312,569 | ) | (48,828,134 | ) | (904,900,050 | ) | ||||||||
Class R6 | (43,136,374 | ) | (881,963,180 | ) | (112,750,641 | ) | (2,033,752,511 | ) | ||||||||
Net increase (decrease) in share activity | (56,026,970 | ) | $ | (1,163,624,341 | ) | (133,586,930 | ) | $ | (2,402,883,905 | ) |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 48% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
17 | Invesco Diversified Dividend Fund |
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Beginning | ACTUAL | HYPOTHETICAL (5% annual return before | Annualized | |||||||||
Ending Account Value (04/30/21)1 | Expenses Paid During Period2 | Ending Account Value (04/30/21) | Expenses Paid During Period2 | |||||||||
Class A | $1,000.00 | $1,283.90 | $4.70 | $1,020.68 | $4.16 | 0.83% | ||||||
Class C | 1,000.00 | 1,278.90 | 8.93 | 1,016.96 | 7.90 | 1.58 | ||||||
Class R | 1,000.00 | 1,281.80 | 6.11 | 1,019.44 | 5.41 | 1.08 | ||||||
Class Y | 1,000.00 | 1,285.10 | 3.29 | 1,021.92 | 2.91 | 0.58 | ||||||
Investor Class | 1,000.00 | 1,283.80 | 4.08 | 1,021.22 | 3.61 | 0.72 | ||||||
Class R5 | 1,000.00 | 1,285.80 | 3.00 | 1,022.17 | 2.66 | 0.53 | ||||||
Class R6 | 1,000.00 | 1,285.60 | 2.49 | 1,022.61 | 2.21 | 0.44 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
18 | Invesco Diversified Dividend Fund |
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ | Fund reports and prospectuses |
∎ | Quarterly statements |
∎ | Daily confirmations |
∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. | ||
Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-01424 and 002-25469 | Invesco Distributors, Inc. | DDI-SAR-1 |
|
| |||
Semiannual Report to Shareholders |
April 30, 2021 | |||
| ||||
Invesco Main Street All Cap Fund® | ||||
Nasdaq: | ||||
A: OMSOX ∎ C: OMSCX ∎ R: OMSNX ∎ Y: OMSYX ∎ R5: MSAZX ∎ R6: IOAPX | ||||
2 | Fund Performance | |||||
4 | Liquidity Risk Management Program | |||||
5 | Schedule of Investments | |||||
8 | Financial Statements | |||||
11 | Financial Highlights | |||||
12 | Notes to Financial Statements | |||||
17 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
Performance summary |
| |||
Fund vs. Indexes |
| |||
Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 30.86 | % | ||
Class C Shares | 30.41 | |||
Class R Shares | 30.76 | |||
Class Y Shares | 31.07 | |||
Class R5 Shares | 31.11 | |||
Class R6 Shares | 31.16 | |||
Russell 3000 Index▼ | 31.08 | |||
Source(s): ▼RIMES Technologies Corp.
The Russell 3000® Index is an unmanaged index considered representative of the US stock market. The Russell 3000 Index is a trademark/service mark of the Frank Russell Co. Russell® is a trademark of the Frank Russell Co. |
| |||
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). |
| |||
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
|
For more information about your Fund |
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. |
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends. |
2 | Invesco Main Street All Cap Fund® |
Average Annual Total Returns |
| |||
As of 4/30/21, including maximum applicable sales charges |
| |||
Class A Shares | ||||
Inception (9/25/00) | 8.34 | % | ||
10 Years | 11.44 | |||
5 Years | 14.26 | |||
1 Year | 42.33 | |||
Class C Shares | ||||
Inception (9/25/00) | 8.32 | % | ||
10 Years | 11.41 | |||
5 Years | 14.71 | |||
1 Year | 48.52 | |||
Class R Shares | ||||
Inception (3/1/01) | 8.59 | % | ||
10 Years | 11.78 | |||
5 Years | 15.27 | |||
1 Year | 50.24 | |||
Class Y Shares | ||||
Inception (9/25/00) | 8.98 | % | ||
10 Years | 12.37 | |||
5 Years | 15.85 | |||
1 Year | 50.95 | |||
Class R5 Shares | ||||
10 Years | 12.15 | % | ||
5 Years | 15.72 | |||
1 Year | 51.13 | |||
Class R6 Shares | ||||
10 Years | 12.16 | % | ||
5 Years | 15.74 | |||
1 Year | 51.10 |
Effective May 24, 2019, Class A, Class C, Class R and Class Y shares of the Oppenheimer Main Street All Cap Fund, (the predecessor fund), were reorganized into Class A, Class C, Class R and Class Y shares, respectively, of the Invesco Oppenheimer Main Street All Cap Fund®. Note: The Fund was subsequently renamed the Invesco Main Street All Cap Fund® (the Fund). Returns shown above, for periods ending on or prior to May 24, 2019, for Class A, Class C, Class R and Class Y shares are those for Class A, Class C, Class R and Class Y shares of the predecessor fund. Share class returns will differ from the predecessor fund because of different expenses.
Class R5 shares incepted on May 24, 2019. Performance shown on and prior to that date is that of the predecessor fund’s Class A shares and includes the 12b-1 fees applicable to Class A shares.
Class R6 shares incepted on May 24, 2019. Performance shown on and prior to that date is that of the predecessor fund’s Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month-end performance. Performance figures re-
flect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
3 | Invesco Main Street All Cap Fund® |
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
∎ The Report stated, in relevant part, that during the Program Reporting Period:
∎ The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal;
∎ The Fund’s investment strategy remained appropriate for an open-end fund;
∎ The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund;
∎ The Fund did not breach the 15% limit on Illiquid Investments; and The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM.
4 | Invesco Main Street All Cap Fund® |
April 30, 2021
(Unaudited)
Shares | Value | |||||||
| ||||||||
Common Stocks & Other Equity Interests–99.76% |
| |||||||
Aerospace & Defense–2.44% |
| |||||||
Boeing Co. (The)(b) | 50,578 | $ | 11,850,931 | |||||
| ||||||||
Lockheed Martin Corp. | 25,906 | 9,858,787 | ||||||
| ||||||||
Raytheon Technologies Corp. | 141,510 | 11,779,293 | ||||||
| ||||||||
33,489,011 | ||||||||
| ||||||||
Air Freight & Logistics–1.45% |
| |||||||
United Parcel Service, Inc., Class B | 97,714 | 19,919,976 | ||||||
| ||||||||
Apparel Retail–1.35% |
| |||||||
Ross Stores, Inc. | 141,357 | 18,509,286 | ||||||
| ||||||||
Application Software–2.44% |
| |||||||
Olo, Inc., Class A(b) | 35,395 | 1,021,500 | ||||||
| ||||||||
Q2 Holdings, Inc.(b) | 71,330 | 7,419,746 | ||||||
| ||||||||
Workday, Inc., Class A(b) | 101,241 | 25,006,527 | ||||||
| ||||||||
33,447,773 | ||||||||
| ||||||||
Automobile Manufacturers–1.25% |
| |||||||
General Motors Co.(b) | 300,683 | 17,205,081 | ||||||
| ||||||||
Automotive Retail–1.19% |
| |||||||
CarMax, Inc.(b) | 122,525 | 16,325,231 | ||||||
| ||||||||
Biotechnology–0.49% |
| |||||||
Seagen, Inc.(b) | 46,896 | 6,741,769 | ||||||
| ||||||||
Communications Equipment–0.41% |
| |||||||
Motorola Solutions, Inc. | 30,125 | 5,672,537 | ||||||
| ||||||||
Construction Machinery & Heavy Trucks–0.86% |
| |||||||
Caterpillar, Inc. | 51,545 | 11,757,930 | ||||||
| ||||||||
Construction Materials–0.55% |
| |||||||
Vulcan Materials Co. | 42,378 | 7,553,455 | ||||||
| ||||||||
Consumer Finance–1.27% | ||||||||
Capital One Financial Corp. | 117,240 | 17,478,139 | ||||||
| ||||||||
Data Processing & Outsourced Services–3.33% |
| |||||||
Fiserv, Inc.(b) | 125,755 | 15,105,690 | ||||||
| ||||||||
Mastercard, Inc., Class A | 79,977 | 30,556,013 | ||||||
| ||||||||
45,661,703 | ||||||||
| ||||||||
Distillers & Vintners–1.31% |
| |||||||
Constellation Brands, Inc., Class A | 74,534 | 17,912,011 | ||||||
| ||||||||
Diversified Banks–4.25% |
| |||||||
JPMorgan Chase & Co. | 378,813 | 58,265,228 | ||||||
| ||||||||
Diversified Chemicals–0.92% |
| |||||||
Eastman Chemical Co. | 108,924 | 12,568,740 | ||||||
| ||||||||
Electric Utilities–2.07% |
| |||||||
Duke Energy Corp. | 168,601 | 16,976,434 | ||||||
| ||||||||
FirstEnergy Corp. | 302,241 | 11,460,979 | ||||||
| ||||||||
28,437,413 | ||||||||
| ||||||||
Financial Exchanges & Data–1.39% |
| |||||||
Intercontinental Exchange, Inc. | 161,880 | 19,054,895 | ||||||
|
Shares | Value | |||||||
| ||||||||
Food Distributors–1.15% |
| |||||||
Sysco Corp. | 186,976 | $ | 15,842,476 | |||||
| ||||||||
Footwear–0.56% |
| |||||||
NIKE, Inc., Class B | 58,111 | 7,706,681 | ||||||
| ||||||||
Gas Utilities–0.29% |
| |||||||
Suburban Propane Partners L.P. | 262,259 | 3,986,337 | ||||||
| ||||||||
Health Care Equipment–2.21% |
| |||||||
Boston Scientific Corp.(b) | 270,800 | 11,806,880 | ||||||
| ||||||||
DexCom, Inc.(b) | 17,417 | 6,724,704 | ||||||
| ||||||||
Zimmer Biomet Holdings, Inc. | 66,822 | 11,838,185 | ||||||
| ||||||||
30,369,769 | ||||||||
| ||||||||
Health Care Facilities–0.82% |
| |||||||
HCA Healthcare, Inc. | 55,733 | 11,205,677 | ||||||
| ||||||||
Health Care Services–1.37% |
| |||||||
Guardant Health, Inc.(b) | 39,574 | 6,291,474 | ||||||
| ||||||||
LHC Group, Inc.(b) | 60,180 | 12,533,689 | ||||||
| ||||||||
18,825,163 | ||||||||
| ||||||||
Home Improvement Retail–1.60% |
| |||||||
Home Depot, Inc. (The) | 67,700 | 21,912,459 | ||||||
| ||||||||
Homebuilding–0.98% |
| |||||||
D.R. Horton, Inc. | 136,117 | 13,378,940 | ||||||
| ||||||||
Hotels, Resorts & Cruise Lines–0.57% |
| |||||||
Airbnb, Inc., Class A(b) | 44,909 | 7,756,234 | ||||||
| ||||||||
Household Products–0.95% |
| |||||||
Procter & Gamble Co. (The) | 98,178 | 13,098,909 | ||||||
| ||||||||
Human Resource & Employment Services–1.02% |
| |||||||
Korn Ferry | 205,521 | 13,952,821 | ||||||
| ||||||||
Industrial Machinery–1.31% |
| |||||||
Stanley Black & Decker, Inc. | 86,911 | 17,970,587 | ||||||
| ||||||||
Industrial REITs–1.71% |
| |||||||
Prologis, Inc. | 201,835 | 23,519,833 | ||||||
| ||||||||
Insurance Brokers–1.22% |
| |||||||
Arthur J. Gallagher & Co. | 115,245 | 16,704,763 | ||||||
| ||||||||
Integrated Oil & Gas–1.83% |
| |||||||
Chevron Corp. | 244,290 | 25,178,970 | ||||||
| ||||||||
Integrated Telecommunication Services–1.78% |
| |||||||
Verizon Communications, Inc. | 423,356 | 24,465,743 | ||||||
| ||||||||
Interactive Home Entertainment–1.79% |
| |||||||
Zynga, Inc., Class A(b) | 2,270,575 | 24,567,621 | ||||||
| ||||||||
Interactive Media & Services–11.77% |
| |||||||
Alphabet, Inc., Class A(b) | 35,300 | 83,078,550 | ||||||
| ||||||||
Bumble, Inc., Class A(b) | 53,261 | 3,208,443 | ||||||
| ||||||||
Facebook, Inc., Class A(b) | 146,891 | 47,751,326 | ||||||
| ||||||||
Snap, Inc., Class A(b) | 444,568 | 27,483,194 | ||||||
| ||||||||
161,521,513 | ||||||||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 | Invesco Main Street All Cap Fund® |
Shares | Value | |||||||
| ||||||||
Internet & Direct Marketing Retail– 4.36% |
| |||||||
Amazon.com, Inc.(b) | 17,266 | $ | 59,868,474 | |||||
| ||||||||
Internet Services & Infrastructure–0.11% |
| |||||||
Snowflake, Inc., Class A(b) | 6,807 | 1,576,433 | ||||||
| ||||||||
Life Sciences Tools & Services–0.64% |
| |||||||
Avantor, Inc.(b) | 273,625 | 8,766,945 | ||||||
| ||||||||
Managed Health Care–2.11% |
| |||||||
UnitedHealth Group, Inc. | 72,698 | 28,991,962 | ||||||
| ||||||||
Office REITs–0.47% |
| |||||||
Alexandria Real Estate Equities, Inc. | 35,427 | 6,415,830 | ||||||
| ||||||||
Oil & Gas Refining & Marketing–0.75% |
| |||||||
Valero Energy Corp. | 138,540 | 10,246,418 | ||||||
| ||||||||
Pharmaceuticals–3.60% |
| |||||||
AstraZeneca PLC, ADR (United Kingdom) | 309,658 | 16,433,550 | ||||||
| ||||||||
Catalent, Inc.(b) | 139,830 | 15,726,680 | ||||||
| ||||||||
Eli Lilly and Co. | 94,636 | 17,296,622 | ||||||
| ||||||||
49,456,852 | ||||||||
| ||||||||
Property & Casualty Insurance–1.32% |
| |||||||
Allstate Corp. (The) | 142,315 | 18,045,542 | ||||||
| ||||||||
Railroads–1.46% |
| |||||||
Union Pacific Corp. | 89,972 | 19,981,881 | ||||||
| ||||||||
Regional Banks–2.70% |
| |||||||
East West Bancorp, Inc. | 120,181 | 9,151,783 | ||||||
| ||||||||
First Citizens BancShares, Inc., Class A | 14,188 | 12,307,523 | ||||||
| ||||||||
Signature Bank | 61,894 | 15,566,960 | ||||||
| ||||||||
37,026,266 | ||||||||
| ||||||||
Restaurants–1.45% |
| |||||||
Starbucks Corp. | 173,544 | 19,869,053 | ||||||
| ||||||||
Semiconductor Equipment–2.33% |
| |||||||
Applied Materials, Inc. | 241,163 | 32,004,742 | ||||||
| ||||||||
Semiconductors–4.80% |
| |||||||
NVIDIA Corp. | 45,891 | 27,552,039 | ||||||
|
Shares | Value | |||||||
| ||||||||
Semiconductors–(continued) | ||||||||
QUALCOMM, Inc. | 187,775 | $ | 26,063,170 | |||||
| ||||||||
Texas Instruments, Inc. | 67,850 | 12,247,603 | ||||||
| ||||||||
65,862,812 | ||||||||
| ||||||||
Soft Drinks–1.51% |
| |||||||
Coca-Cola Co. (The) | 383,821 | 20,718,658 | ||||||
| ||||||||
Specialized REITs–0.19% |
| |||||||
Lamar Advertising Co., Class A | 26,866 | 2,660,809 | ||||||
| ||||||||
Specialty Chemicals–0.30% |
| |||||||
Diversey Holdings Ltd.(b) | 227,266 | 4,090,788 | ||||||
| ||||||||
Specialty Stores–0.88% |
| |||||||
Tractor Supply Co. | 64,096 | 12,088,506 | ||||||
| ||||||||
Systems Software–6.48% |
| |||||||
Microsoft Corp. | 323,958 | 81,695,727 | ||||||
| ||||||||
VMware, Inc., Class A(b) | 44,797 | 7,204,702 | ||||||
| ||||||||
88,900,429 | ||||||||
| ||||||||
Technology Hardware, Storage & Peripherals–3.87% |
| |||||||
Apple, Inc. | 403,640 | 53,062,514 | ||||||
| ||||||||
Trading Companies & Distributors–0.53% |
| |||||||
Fastenal Co. | 139,235 | 7,279,206 | ||||||
| ||||||||
Total Common Stocks & Other Equity Interests |
| 1,368,878,794 | ||||||
| ||||||||
Money Market Funds–0.28% | ||||||||
Invesco Government & Agency Portfolio, Institutional Class, 0.03%(c)(d) | 1,360,182 | 1,360,182 | ||||||
| ||||||||
Invesco Liquid Assets Portfolio, Institutional Class, 0.01%(c)(d) | 967,253 | 967,641 | ||||||
| ||||||||
Invesco Treasury Portfolio, Institutional Class, | 1,560,493 | 1,560,493 | ||||||
| ||||||||
Total Money Market Funds |
| 3,888,316 | ||||||
| ||||||||
TOTAL INVESTMENTS IN SECURITIES–100.04% |
| |||||||
(Cost $820,959,318) | 1,372,767,110 | |||||||
| ||||||||
OTHER ASSETS LESS LIABILITIES–(0.04)% |
| (614,429 | ) | |||||
| ||||||||
NET ASSETS–100.00% |
| $ | 1,372,152,681 | |||||
|
Investment Abbreviations:
ADR – American Depositary Receipt
REIT – Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
Value October 31, 2020 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation | Realized Gain (Loss) | Value April 30, 2021 | Dividend Income | |||||||||||||||||||||||||||||
Investments in Affiliated Money Market Funds: | |||||||||||||||||||||||||||||||||||
Invesco Government & Agency Portfolio, Institutional Class | $ | 274,252 | $ | 22,418,214 | $ | (21,332,284 | ) | $ | - | $ | - | $ | 1,360,182 | $ | 175 | ||||||||||||||||||||
Invesco Liquid Assets Portfolio, Institutional Class | 104,078 | 16,013,010 | (15,149,396 | ) | 10 | (61 | ) | 967,641 | 149 | ||||||||||||||||||||||||||
Invesco Treasury Portfolio, Institutional Class | 319,431 | 25,620,816 | (24,379,754 | ) | - | - | 1,560,493 | 78 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 | Invesco Main Street All Cap Fund® |
Value October 31, 2020 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation | Realized Gain (Loss) | Value April 30, 2021 | Dividend Income | |||||||||||||||||||||||||||||
Investments Purchased with Cash Collateral from Securities on Loan: | |||||||||||||||||||||||||||||||||||
Invesco Private Government Fund | $ | - | $ | 29,934,809 | $ | (29,934,809 | ) | $ | - | $ | - | $ | - | $ | 46 | * | |||||||||||||||||||
Invesco Private Prime Fund | - | 46,350,159 | (46,350,159 | ) | - | - | - | 497 | * | ||||||||||||||||||||||||||
Total | $ | 697,761 | $ | 140,337,008 | $ | (137,146,402 | ) | $ | 10 | $ | (61 | ) | $ | 3,888,316 | $ | 945 |
* | Represents the income earned on the investment of cash collateral, which is included in securities lending income on the Statement of Operations. Does not include rebates and fees paid to lending agent or premiums received from borrowers, if any. |
(d) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
Information Technology | 23.77 | % | |||
Communication Services | 15.35 | ||||
Consumer Discretionary | 14.18 | ||||
Financials | 12.14 | ||||
Health Care | 11.25 | ||||
Industrials | 9.06 | ||||
Consumer Staples | 4.92 | ||||
Energy | 2.58 | ||||
Real Estate | 2.38 | ||||
Utilities | 2.36 | ||||
Materials | 1.77 | ||||
Money Market Funds Plus Other Assets Less Liabilities | 0.24 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 | Invesco Main Street All Cap Fund® |
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
Assets: | ||||
Investments in securities, at value | $ | 1,368,878,794 | ||
| ||||
Investments in affiliated money market funds, at value (Cost $3,888,316) | 3,888,316 | |||
| ||||
Receivable for: | ||||
Investments sold | 2,300,258 | |||
| ||||
Fund shares sold | 236,706 | |||
| ||||
Dividends | 621,924 | |||
| ||||
Investment for trustee deferred compensation and retirement plans | 180,745 | |||
| ||||
Other assets | 86,771 | |||
| ||||
Total assets | 1,376,193,514 | |||
| ||||
Liabilities: | ||||
Payable for: | ||||
Investments purchased | 1,997,043 | |||
| ||||
Fund shares reacquired | 777,349 | |||
| ||||
Amount due custodian | 230,821 | |||
| ||||
Accrued fees to affiliates | 707,302 | |||
| ||||
Accrued trustees’ and officers’ fees and benefits | 966 | |||
| ||||
Accrued other operating expenses | 146,607 | |||
| ||||
Trustee deferred compensation and retirement plans | 180,745 | |||
| ||||
Total liabilities | 4,040,833 | |||
| ||||
Net assets applicable to shares outstanding | $ | 1,372,152,681 | ||
| ||||
Net assets consist of: | ||||
Shares of beneficial interest | $ | 741,004,947 | ||
| ||||
Distributable earnings | 631,147,734 | |||
| ||||
$1,372,152,681 | ||||
|
Net Assets: | ||||
Class A | $ | 1,184,588,055 | ||
| ||||
Class C | $ | 60,176,910 | ||
| ||||
Class R | $ | 59,983,278 | ||
| ||||
Class Y | $ | 64,814,299 | ||
| ||||
Class R5 | $ | 15,567 | ||
| ||||
Class R6 | $ | 2,574,572 | ||
| ||||
Shares outstanding, no par value, with an unlimited number of shares authorized: |
| |||
Class A | 44,644,610 | |||
| ||||
Class C | 2,544,222 | |||
| ||||
Class R | 2,344,791 | |||
| ||||
Class Y | 2,373,354 | |||
| ||||
Class R5 | 584 | |||
| ||||
Class R6 | 96,535 | |||
| ||||
Class A: | ||||
Net asset value per share | $ | 26.53 | ||
| ||||
Maximum offering price per share | ||||
(Net asset value of $26.53 ÷ 94.50%) | $ | 28.07 | ||
| ||||
Class C: | ||||
Net asset value and offering price per share | $ | 23.65 | ||
| ||||
Class R: | ||||
Net asset value and offering price per share | $ | 25.58 | ||
| ||||
Class Y: | ||||
Net asset value and offering price per share | $ | 27.31 | ||
| ||||
Class R5: | ||||
Net asset value and offering price per share | $ | 26.66 | ||
| ||||
Class R6: | ||||
Net asset value and offering price per share | $ | 26.67 | ||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 | Invesco Main Street All Cap Fund® |
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
Investment income: | ||||
Dividends | $ | 8,843,191 | ||
| ||||
Dividends from affiliated money market funds (includes securities lending income of $1,863) | 2,265 | |||
| ||||
Total investment income | 8,845,456 | |||
| ||||
Expenses: | ||||
Advisory fees | 4,076,099 | |||
| ||||
Administrative services fees | 89,987 | |||
| ||||
Custodian fees | 2,796 | |||
| ||||
Distribution fees: | ||||
Class A | 1,303,455 | |||
| ||||
Class C | 301,582 | |||
| ||||
Class R | 137,355 | |||
| ||||
Transfer agent fees – A, C, R and Y | 1,065,341 | |||
| ||||
Transfer agent fees – R5 | 7 | |||
| ||||
Transfer agent fees – R6 | 314 | |||
| ||||
Trustees’ and officers’ fees and benefits | 18,925 | |||
| ||||
Registration and filing fees | 57,385 | |||
| ||||
Reports to shareholders | 54,052 | |||
| ||||
Professional services fees | 35,956 | |||
| ||||
Other | 35,293 | |||
| ||||
Total expenses | 7,178,547 | |||
| ||||
Less: Fees waived and/or expense offset arrangement(s) | (4,962 | ) | ||
| ||||
Net expenses | 7,173,585 | |||
| ||||
Net investment income | 1,671,871 | |||
| ||||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Unaffiliated investment securities | 79,672,521 | |||
| ||||
Affiliated investment securities | (61 | ) | ||
| ||||
79,672,460 | ||||
| ||||
Change in net unrealized appreciation of: | ||||
Unaffiliated investment securities | 250,930,804 | |||
| ||||
Affiliated investment securities | 10 | |||
| ||||
250,930,814 | ||||
| ||||
Net realized and unrealized gain | 330,603,274 | |||
| ||||
Net increase in net assets resulting from operations | $ | 332,275,145 | ||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 | Invesco Main Street All Cap Fund® |
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
April 30, 2021 | October 31, 2020 | |||||||
| ||||||||
Operations: | ||||||||
Net investment income | $ | 1,671,871 | $ | 7,507,953 | ||||
| ||||||||
Net realized gain | 79,672,460 | 3,373,975 | ||||||
| ||||||||
Change in net unrealized appreciation | 250,930,814 | 104,864,187 | ||||||
| ||||||||
Net increase in net assets resulting from operations | 332,275,145 | 115,746,115 | ||||||
| ||||||||
Distributions to shareholders from distributable earnings: | ||||||||
Class A | (9,443,275 | ) | (7,795,197 | ) | ||||
| ||||||||
Class C | (652,957 | ) | (396,656 | ) | ||||
| ||||||||
Class R | (482,249 | ) | (389,152 | ) | ||||
| ||||||||
Class Y | (520,083 | ) | (420,149 | ) | ||||
| ||||||||
Class R5 | (128 | ) | (104 | ) | ||||
| ||||||||
Class R6 | (1,102 | ) | (689 | ) | ||||
| ||||||||
Total distributions from distributable earnings | (11,099,794 | ) | (9,001,947 | ) | ||||
| ||||||||
Share transactions–net: | ||||||||
Class A | (30,200,952 | ) | (110,551,170 | ) | ||||
| ||||||||
Class C | (17,024,832 | ) | (14,110,428 | ) | ||||
| ||||||||
Class R | (4,020,606 | ) | (7,983,410 | ) | ||||
| ||||||||
Class Y | 514,702 | (1,449,042 | ) | |||||
| ||||||||
Class R6 | 2,316,542 | 82,990 | ||||||
| ||||||||
Net increase (decrease) in net assets resulting from share transactions | (48,415,146 | ) | (134,011,060 | ) | ||||
| ||||||||
Net increase (decrease) in net assets | 272,760,205 | (27,266,892 | ) | |||||
| ||||||||
Net assets: | ||||||||
Beginning of period | 1,099,392,476 | 1,126,659,368 | ||||||
| ||||||||
End of period | $ | 1,372,152,681 | $ | 1,099,392,476 | ||||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 | Invesco Main Street All Cap Fund® |
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed(c) | Ratio of net investment income (loss) to average net assets | Portfolio turnover(d) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | $ | 20.45 | $ | 0.04 | $ | 6.25 | $ | 6.29 | $ | (0.11 | ) | $ | (0.10 | ) | $ | (0.21 | ) | $ | 26.53 | 30.92 | %(e) | $ | 1,184,588 | 1.11 | %(e)(f) | 1.11 | %(e)(f) | 0.31 | %(e)(f) | 16 | % | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 18.53 | 0.14 | 1.94 | 2.08 | (0.09 | ) | (0.07 | ) | (0.16 | ) | 20.45 | 11.24 | (e) | 938,494 | 1.12 | (e) | 1.12 | (e) | 0.73 | (e) | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||
Three months ended 10/31/19 | 18.30 | 0.03 | 0.20 | 0.23 | – | – | – | 18.53 | 1.26 | 957,529 | 1.14 | (g) | 1.14 | (g) | 0.73 | (g) | 7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/19 | 18.77 | 0.13 | 0.75 | 0.88 | (0.07 | ) | (1.28 | ) | (1.35 | ) | 18.30 | 5.84 | 976,093 | 1.13 | 1.13 | 0.73 | 48 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/18 | 19.40 | 0.09 | 1.84 | 1.93 | (0.18 | ) | (2.38 | ) | (2.56 | ) | 18.77 | 10.55 | 923,741 | 1.13 | 1.14 | 0.50 | 48 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/17 | 18.35 | 0.17 | 2.21 | 2.38 | (0.20 | ) | (1.13 | ) | (1.33 | ) | 19.40 | 13.67 | 919,892 | 1.14 | 1.15 | 0.92 | 89 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/16 | 20.29 | 0.14 | 0.00 | 0.14 | (0.10 | ) | (1.98 | ) | (2.08 | ) | 18.35 | 1.26 | 927,091 | 1.14 | 1.14 | 0.80 | 67 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 18.31 | (0.05 | ) | 5.59 | 5.54 | (0.10 | ) | (0.10 | ) | (0.20 | ) | 23.65 | 30.41 | 60,177 | 1.87 | (f) | 1.87 | (f) | (0.45 | )(f) | 16 | |||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 16.66 | (0.01 | ) | 1.76 | 1.75 | (0.03 | ) | (0.07 | ) | (0.10 | ) | 18.31 | 10.52 | 61,600 | 1.88 | 1.88 | (g) | (0.03 | )(g) | 28 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Three months ended 10/31/19 | 16.49 | – | 0.17 | 0.17 | – | – | – | 16.66 | 1.03 | 69,736 | 1.90 | (g) | 1.90 | (g) | (0.03 | )(g) | 7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/19 | 17.10 | – | 0.67 | 0.67 | – | (1.28 | ) | (1.28 | ) | 16.49 | 5.18 | 73,404 | 1.89 | 1.89 | (0.02 | ) | 48 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/18 | 17.88 | (0.04 | ) | 1.68 | 1.64 | (0.04 | ) | (2.38 | ) | (2.42 | ) | 17.10 | 9.67 | 201,771 | 1.88 | 1.89 | (0.25 | ) | 48 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/17 | 17.01 | 0.03 | 2.04 | 2.07 | (0.07 | ) | (1.13 | ) | (1.20 | ) | 17.88 | 12.84 | 219,426 | 1.89 | 1.90 | 0.17 | 89 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/16 | 19.00 | 0.01 | (0.02 | ) | (0.01 | ) | – | (1.98 | ) | (1.98 | ) | 17.01 | 0.48 | 228,811 | 1.89 | 1.89 | 0.05 | 67 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 19.74 | 0.01 | 6.03 | 6.04 | (0.10 | ) | (0.10 | ) | (0.20 | ) | 25.58 | 30.76 | 59,983 | 1.37 | (f) | 1.37 | (f) | 0.05 | (f) | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 17.91 | 0.09 | 1.88 | 1.97 | (0.07 | ) | (0.07 | ) | (0.14 | ) | 19.74 | 11.01 | 49,869 | 1.38 | 1.38 | 0.47 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Three months ended 10/31/19 | 17.70 | 0.02 | 0.19 | 0.21 | – | – | – | 17.91 | 1.19 | 53,064 | 1.40 | (g) | 1.40 | (g) | 0.47 | (g) | 7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/19 | 18.20 | 0.08 | 0.73 | 0.81 | (0.03 | ) | (1.28 | ) | (1.31 | ) | 17.70 | 5.63 | 55,265 | 1.38 | 1.38 | 0.48 | 48 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/18 | 18.88 | 0.05 | 1.78 | 1.83 | (0.13 | ) | (2.38 | ) | (2.51 | ) | 18.20 | 10.27 | 58,150 | 1.38 | 1.39 | 0.25 | 48 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/17 | 17.89 | 0.12 | 2.16 | 2.28 | (0.16 | ) | (1.13 | ) | (1.29 | ) | 18.88 | 13.40 | 62,250 | 1.39 | 1.40 | 0.67 | 89 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/16 | 19.83 | 0.10 | (0.02 | ) | 0.08 | (0.04 | ) | (1.98 | ) | (2.02 | ) | 17.89 | 0.96 | 61,124 | 1.39 | 1.39 | 0.55 | 67 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 21.03 | 0.07 | 6.43 | 6.50 | (0.12 | ) | (0.10 | ) | (0.22 | ) | 27.31 | 31.07 | 64,814 | 0.87 | (f) | 0.87 | (f) | 0.55 | (f) | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 19.01 | 0.19 | 2.01 | 2.20 | (0.11 | ) | (0.07 | ) | (0.18 | ) | 21.03 | 11.59 | 49,316 | 0.88 | 0.88 | 0.97 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Three months ended 10/31/19 | 18.77 | 0.05 | 0.19 | 0.24 | – | – | – | 19.01 | 1.28 | 46,309 | 0.91 | (g) | 0.91 | (g) | 0.97 | (g) | 7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/19 | 19.22 | 0.18 | 0.77 | 0.95 | (0.12 | ) | (1.28 | ) | (1.40 | ) | 18.77 | 6.11 | 44,719 | 0.89 | 0.89 | 0.98 | 48 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/18 | 19.81 | 0.14 | 1.88 | 2.02 | (0.23 | ) | (2.38 | ) | (2.61 | ) | 19.22 | 10.84 | 42,354 | 0.88 | 0.89 | 0.74 | 48 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/17 | 18.70 | 0.22 | 2.26 | 2.48 | (0.24 | ) | (1.13 | ) | (1.37 | ) | 19.81 | 13.96 | 43,905 | 0.90 | 0.91 | 1.15 | 89 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 07/31/16 | 20.65 | 0.19 | (0.02 | ) | 0.17 | (0.14 | ) | (1.98 | ) | (2.12 | ) | 18.70 | 1.43 | 32,254 | 0.89 | 0.89 | 1.05 | 67 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 20.53 | 0.07 | 6.28 | 6.35 | (0.12 | ) | (0.10 | ) | (0.22 | ) | 26.66 | 31.11 | 16 | 0.80 | (f) | 0.80 | (f) | 0.62 | (f) | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 18.56 | 0.20 | 1.95 | 2.15 | (0.11 | ) | (0.07 | ) | (0.18 | ) | 20.53 | 11.64 | 12 | 0.80 | 0.80 | 1.05 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Three months ended 10/31/19 | 18.31 | 0.05 | 0.20 | 0.25 | – | – | – | 18.56 | 1.37 | 11 | 0.84 | (g) | 0.84 | (g) | 1.04 | (g) | 7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Period ended 07/31/19(h) | 17.13 | 0.04 | 1.14 | 1.18 | – | – | – | 18.31 | 6.89 | 11 | 0.79 | (g) | 0.79 | (g) | 1.07 | (g) | 48 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 20.53 | 0.07 | 6.29 | 6.36 | (0.12 | ) | (0.10 | ) | (0.22 | ) | 26.67 | 31.16 | 2,575 | 0.80 | (f) | 0.80 | (f) | 0.62 | (f) | 16 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 18.56 | 0.20 | 1.96 | 2.16 | (0.12 | ) | (0.07 | ) | (0.19 | ) | 20.53 | 11.68 | 102 | 0.80 | 0.80 | 1.05 | 28 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Three months ended 10/31/19 | 18.31 | 0.05 | 0.20 | 0.25 | – | – | – | 18.56 | 1.37 | 11 | 0.73 | (g) | 0.73 | (g) | 1.15 | (g) | 7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Period ended 07/31/19(h) | 17.13 | 0.04 | 1.14 | 1.18 | – | – | – | 18.31 | 6.89 | 11 | 0.74 | (g) | 0.74 | (g) | 1.12 | (g) | 48 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Does not include indirect expenses from affiliated fund fees and expenses of 0.00% for the three months ended October 31, 2019 and the years ended July 31, 2019, 2018, 2017 and 2016, respectively. |
(d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(e) | The total return, ratio of expenses to average net assets and ratio of net investment income (loss) to average net assets reflect actual 12b-1 fees of 0.24% for the six months ended April 30, 2021 and the year ended ended October 31, 2020. |
(f) | Ratios are annualized and based on average daily net assets (000’s omitted) of $1,084,426, $60,816, $55,398, $58,918, $14 and $632 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(g) | Annualized. |
(h) | Commencement date after the close of business on May 24, 2019. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 | Invesco Main Street All Cap Fund® |
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Main Street All Cap Fund® (the “Fund”) is a series portfolio of AIM Equity Funds (Invesco Equity Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek capital appreciation.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. Security Valuations – Securities, including restricted securities, are valued according to the following policy.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
12 | Invesco Main Street All Cap Fund® |
settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | COVID-19 Risk – The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets* | Rate | |||
| ||||
Up to $200 million | 0.750% | |||
| ||||
Next $200 million | 0.720% | |||
| ||||
Next $200 million | 0.690% | |||
| ||||
Next $200 million | 0.660% | |||
| ||||
Next $4.2 billion | 0.600% | |||
| ||||
Over $5 billion | 0.580% | |||
|
* | The advisory fee paid by the Fund shall be reduced by any amounts paid by the Fund under the administrative services agreement with the Adviser. |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.65% .
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the
13 | Invesco Main Street All Cap Fund® |
Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s). Invesco has also entered into a sub-advisory agreement with OppenheimerFunds, Inc. to provide discretionary management services to the Fund.
The Adviser has contractually agreed, through May 31, 2021, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.16%, 1.90%, 1.41%, 0.91%, 0.86%, and 0.81% , respectively, of the Fund’s average daily net assets (the “expense limits”). Effective June 1, 2021 through at least June 30, 2022, the Adviser has contractually agreed to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.00%, 2.75%, 2.25%, 1.75%, 1.75% and 1.75%, respectively, of the Fund’s average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
The Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $1,445.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Class A Plan, reimburses IDI for its allocated share of expenses incurred for the period, up to a maximum annual rate of 0.25% of the average daily net assets of Class A shares. The Fund pursuant to the Class C and Class R Plan, pays IDI compensation at the annual rate of 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $41,605 in front-end sales commissions from the sale of Class A shares and $1 and $831 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $10,333 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 – | Prices are determined using quoted prices in an active market for identical assets. | |
Level 2 – | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. | |
Level 3 – | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
As of April 30, 2021, all of the securities in this Fund were valued based on Level 1 inputs (see the Schedule of Investments for security categories). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
NOTE 4–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $3,517.
14 | Invesco Main Street All Cap Fund® |
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 8–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $199,887,001 and $257,602,715, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
| ||||
Aggregate unrealized appreciation of investments | $ | 558,933,576 | ||
| ||||
Aggregate unrealized (depreciation) of investments | (4,911,875 | ) | ||
| ||||
Net unrealized appreciation of investments | $ | 554,021,701 | ||
|
Cost of investments for tax purposes is $818,745,409.
NOTE 9–Share Information
Summary of Share Activity | ||||||||||||||||
| ||||||||||||||||
Six months ended | Year ended | |||||||||||||||
April 30, 2021(a) | October 31, 2020 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
| ||||||||||||||||
Sold: | ||||||||||||||||
Class A | 1,273,010 | $ | 30,571,263 | 2,611,884 | $ | 49,051,813 | ||||||||||
| ||||||||||||||||
Class C | 246,062 | 5,312,856 | 467,737 | 7,839,859 | ||||||||||||
| ||||||||||||||||
Class R | 190,308 | 4,401,152 | 342,395 | 6,294,544 | ||||||||||||
| ||||||||||||||||
Class Y | 398,462 | 9,699,307 | 630,773 | 12,241,173 | ||||||||||||
| ||||||||||||||||
Class R6 | 96,444 | 2,436,684 | 5,309 | 101,624 | ||||||||||||
| ||||||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 398,023 | 9,082,874 | 391,425 | 7,515,353 | ||||||||||||
| ||||||||||||||||
Class C | 31,529 | 643,194 | 22,579 | 390,389 | ||||||||||||
| ||||||||||||||||
Class R | 21,805 | 480,149 | 20,839 | 386,971 | ||||||||||||
| ||||||||||||||||
Class Y | 20,149 | 472,705 | 19,283 | 379,690 | ||||||||||||
| ||||||||||||||||
Class R6 | 28 | 642 | 24 | 454 | ||||||||||||
| ||||||||||||||||
Automatic conversion of Class C shares to Class A shares: | ||||||||||||||||
Class A | 727,681 | 16,937,594 | �� | 381,717 | 7,245,522 | |||||||||||
| ||||||||||||||||
Class C | (814,434 | ) | (16,937,594 | ) | (425,067 | ) | (7,245,522 | ) | ||||||||
|
15 | Invesco Main Street All Cap Fund® |
Summary of Share Activity | ||||||||||||||||
| ||||||||||||||||
Six months ended | Year ended | |||||||||||||||
April 30, 2021(a) | October 31, 2020 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
| ||||||||||||||||
Reacquired: | ||||||||||||||||
Class A | (3,636,347 | ) | $ | (86,792,683 | ) | (9,191,364 | ) | $ | (174,363,858 | ) | ||||||
| ||||||||||||||||
Class C | (283,361 | ) | (6,043,288 | ) | (885,984 | ) | (15,095,154 | ) | ||||||||
| ||||||||||||||||
Class R | (393,143 | ) | (8,901,907 | ) | (799,605 | ) | (14,664,925 | ) | ||||||||
| ||||||||||||||||
Class Y | (390,398 | ) | (9,657,310 | ) | (740,530 | ) | (14,069,905 | ) | ||||||||
| ||||||||||||||||
Class R6 | (4,917 | ) | (120,784 | ) | (937 | ) | (19,088 | ) | ||||||||
| ||||||||||||||||
Net increase (decrease) in share activity | (2,119,099 | ) | $ | (48,415,146 | ) | (7,149,522 | ) | $ | (134,011,060 | ) | ||||||
|
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 11% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
16 | Invesco Main Street All Cap Fund® |
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, expenses shown in the table do not include the expenses of the underlying funds, which are borne indirectly by the Fund. If transaction costs and indirect expenses were included, your costs would have been higher.
ACTUAL | HYPOTHETICAL (5% annual return before expenses) | |||||||||||
Beginning Account Value (11/01/20) | Ending Account Value (04/30/21)1 | Expenses Paid During Period2 | Ending Account Value (04/30/21) | Expenses Paid During Period2 | Annualized Expense Ratio | |||||||
Class A | $1,000.00 | $1,309.20 | $ 6.36 | $1,019.29 | $5.56 | 1.11% | ||||||
Class C | 1,000.00 | 1,304.10 | 10.68 | 1,015.52 | 9.35 | 1.87 | ||||||
Class R | 1,000.00 | 1,307.60 | 7.84 | 1,018.00 | 6.85 | 1.37 | ||||||
Class Y | 1,000.00 | 1,310.70 | 4.98 | 1,020.48 | 4.36 | 0.87 | ||||||
Class R5 | 1,000.00 | 1,311.10 | 4.58 | 1,020.83 | 4.01 | 0.80 | ||||||
Class R6 | 1,000.00 | 1,311.60 | 4.59 | 1,020.83 | 4.01 | 0.80 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
17 | Invesco Main Street All Cap Fund® |
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ | Fund reports and prospectuses |
∎ | Quarterly statements |
∎ | Daily confirmations |
∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-01424 and 002-25469 Invesco Distributors, Inc. O-MSA-SAR-1
| ||||
Semiannual Report to Shareholders | April 30, 2021 | |||
| ||||
Invesco Main Street Fund® | ||||
Nasdaq: | ||||
A: MSIGX ∎ C: MIGCX ∎ R: OMGNX ∎ Y: MIGYX ∎ R5: MSJFX ∎ R6: OMSIX |
2 | Fund Performance | |||||
4 | Liquidity Risk Management Program | |||||
5 | Schedule of Investments | |||||
8 | Financial Statements | |||||
11 | Financial Highlights | |||||
12 | Notes to Financial Statements | |||||
17 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
Performance summary |
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 28.63 | % | ||
Class C Shares | 28.15 | |||
Class R Shares | 28.49 | |||
Class Y Shares | 28.77 | |||
Class R5 Shares | 28.88 | |||
Class R6 Shares | 28.87 | |||
S&P 500 Index▼ | 28.85 | |||
Source(s): ▼RIMES Technologies Corp. | ||||
The S&P 500® Index is an unmanaged index considered representative of the US stock market. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
|
For more information about your Fund |
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. |
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends. |
2 | Invesco Main Street Fund® |
Average Annual Total Returns |
| |||
As of 4/30/21, including maximum applicable sales charges |
| |||
Class A Shares | ||||
Inception (2/3/88) | 11.51 | % | ||
10 Years | 12.36 | |||
5 Years | 13.81 | |||
1 Year | 35.94 | |||
Class C Shares | ||||
Inception (12/1/93) | 8.92 | % | ||
10 Years | 12.32 | |||
5 Years | 14.23 | |||
1 Year | 41.72 | |||
Class R Shares | ||||
Inception (3/1/01) | 7.34 | % | ||
10 Years | 12.70 | |||
5 Years | 14.81 | |||
1 Year | 43.47 | |||
Class Y Shares | ||||
Inception (11/1/96) | 8.84 | % | ||
10 Years | 13.30 | |||
5 Years | 15.37 | |||
1 Year | 44.17 | |||
Class R5 Shares | ||||
10 Years | 13.07 | % | ||
5 Years | 15.26 | |||
1 Year | 44.39 | |||
Class R6 Shares | ||||
Inception (12/29/11) | 15.09 | % | ||
5 Years | 15.55 | |||
1 Year | 44.32 |
Effective May 24, 2019, Class A, Class C, Class R, Class Y and Class I shares of the Oppenheimer Main Street Fund, (the predecessor fund), were reorganized into Class A, Class C, Class R, Class Y and Class R6 shares, respectively, of the Invesco Oppenheimer Main Street Fund®. Note: The Fund was subsequently renamed the Invesco Main Street Fund® (the Fund). Returns shown above, for periods ending on or prior to May 24, 2019, for Class A, Class C, Class R, Class Y and Class R6 shares are those for Class A, Class C, Class R, Class Y and Class I shares of the predecessor fund. Share class returns will differ from the predecessor fund because of different expenses.
Class R5 shares incepted on May 24, 2019. Performance shown on and prior to that date is that of the predecessor
fund’s Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on
Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
3 | Invesco Main Street Fund® |
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 | Invesco Main Street Fund® |
April 30, 2021
(Unaudited)
Shares | Value | |||||||
| ||||||||
Common Stocks & Other Equity Interests–99.60% |
| |||||||
Aerospace & Defense–1.90% |
| |||||||
Lockheed Martin Corp. | 140,657 | $ | 53,528,428 | |||||
| ||||||||
Raytheon Technologies Corp. | 1,861,878 | 154,982,725 | ||||||
| ||||||||
208,511,153 | ||||||||
| ||||||||
Air Freight & Logistics–2.70% |
| |||||||
United Parcel Service, Inc., Class B | 1,453,237 | 296,256,895 | ||||||
| ||||||||
Application Software–1.40% |
| |||||||
Citrix Systems, Inc. | 165,673 | 20,518,601 | ||||||
| ||||||||
Workday, Inc., Class A(b) | 538,209 | 132,937,623 | ||||||
| ||||||||
153,456,224 | ||||||||
| ||||||||
Automobile Manufacturers–1.19% |
| |||||||
General Motors Co.(b) | 2,284,252 | 130,704,899 | ||||||
| ||||||||
Automotive Retail–1.84% |
| |||||||
CarMax, Inc.(b) | 772,381 | 102,912,045 | ||||||
| ||||||||
O’Reilly Automotive, Inc.(b) | 178,889 | 98,904,150 | ||||||
| ||||||||
201,816,195 | ||||||||
| ||||||||
Biotechnology–0.27% |
| |||||||
Neurocrine Biosciences, Inc.(b) | 317,706 | 30,020,040 | ||||||
| ||||||||
Cable & Satellite–1.70% |
| |||||||
Comcast Corp., Class A | 3,324,607 | 186,676,683 | ||||||
| ||||||||
Commodity Chemicals–0.54% |
| |||||||
Valvoline, Inc. | 1,869,264 | 58,694,890 | ||||||
| ||||||||
Communications Equipment–1.29% |
| |||||||
Motorola Solutions, Inc. | 751,306 | 141,470,920 | ||||||
| ||||||||
Construction Machinery & Heavy Trucks–0.89% |
| |||||||
Caterpillar, Inc. | 430,216 | 98,136,572 | ||||||
| ||||||||
Construction Materials–0.88% |
| |||||||
Vulcan Materials Co. | 538,927 | 96,058,348 | ||||||
| ||||||||
Consumer Finance–2.22% |
| |||||||
Capital One Financial Corp. | 1,632,391 | 243,356,850 | ||||||
| ||||||||
Data Processing & Outsourced Services–3.24% |
| |||||||
Fiserv, Inc.(b) | 1,404,524 | 168,711,423 | ||||||
| ||||||||
Mastercard, Inc., Class A | 489,156 | 186,886,941 | ||||||
| ||||||||
355,598,364 | ||||||||
| ||||||||
Distillers & Vintners–1.55% |
| |||||||
Constellation Brands, Inc., Class A | 709,291 | 170,456,813 | ||||||
| ||||||||
Diversified Banks–3.20% | ||||||||
JPMorgan Chase & Co. | 2,285,012 | 351,457,696 | ||||||
| ||||||||
Electric Utilities–1.49% |
| |||||||
FirstEnergy Corp. | 4,317,551 | 163,721,534 | ||||||
| ||||||||
Electrical Components & Equipment–0.95% |
| |||||||
Hubbell, Inc. | 213,015 | 40,901,010 | ||||||
| ||||||||
Rockwell Automation, Inc. | 239,504 | 63,291,327 | ||||||
| ||||||||
104,192,337 | ||||||||
|
Shares | Value | |||||||
| ||||||||
Environmental & Facilities Services–0.72% |
| |||||||
Waste Connections, Inc. | 666,629 | $ | 79,402,180 | |||||
| ||||||||
Financial Exchanges & Data–1.58% |
| |||||||
Intercontinental Exchange, Inc. | 1,475,857 | 173,723,127 | ||||||
| ||||||||
Food Distributors–1.05% | ||||||||
Sysco Corp. | 1,356,670 | 114,950,649 | ||||||
| ||||||||
General Merchandise Stores–1.25% |
| |||||||
Target Corp. | 660,575 | 136,910,774 | ||||||
| ||||||||
Health Care Facilities–2.59% | ||||||||
HCA Healthcare, Inc. | 1,415,421 | 284,584,546 | ||||||
| ||||||||
Health Care Services–1.41% | ||||||||
CVS Health Corp. | 2,032,313 | 155,268,713 | ||||||
| ||||||||
Health Care Supplies–0.43% | ||||||||
Alcon, Inc. (Switzerland) | 628,426 | 47,402,173 | ||||||
| ||||||||
Home Improvement Retail–2.05% | ||||||||
Home Depot, Inc. (The) | 693,380 | 224,426,305 | ||||||
| ||||||||
Homebuilding–0.97% | ||||||||
D.R. Horton, Inc. | 1,080,096 | 106,162,636 | ||||||
| ||||||||
Hotels, Resorts & Cruise Lines–1.24% |
| |||||||
Airbnb, Inc., Class A(b)(c) | 168,819 | 29,156,730 | ||||||
| ||||||||
Booking Holdings, Inc.(b) | 43,306 | 106,796,060 | ||||||
| ||||||||
135,952,790 | ||||||||
| ||||||||
Household Products–2.29% | ||||||||
Procter & Gamble Co. (The) | 1,611,524 | 215,009,532 | ||||||
| ||||||||
Reckitt Benckiser Group PLC (United Kingdom) | 413,447 | 36,853,695 | ||||||
| ||||||||
251,863,227 | ||||||||
| ||||||||
Industrial Conglomerates–0.28% | ||||||||
Honeywell International, Inc. | 135,584 | 30,240,655 | ||||||
| ||||||||
Industrial Machinery–1.71% | ||||||||
Otis Worldwide Corp. | 2,415,861 | 188,123,096 | ||||||
| ||||||||
Industrial REITs–2.48% | ||||||||
Prologis, Inc. | 2,339,702 | 272,645,474 | ||||||
| ||||||||
Integrated Telecommunication Services–1.83% |
| |||||||
Verizon Communications, Inc. | 3,479,248 | 201,065,742 | ||||||
| ||||||||
Interactive Home Entertainment–0.97% |
| |||||||
Zynga, Inc., Class A(b) | 9,862,614 | 106,713,483 | ||||||
| ||||||||
Interactive Media & Services–4.09% |
| |||||||
Facebook, Inc., Class A(b) | 1,239,504 | 402,937,961 | ||||||
| ||||||||
Snap, Inc., Class A(b) | 743,782 | 45,980,603 | ||||||
| ||||||||
448,918,564 | ||||||||
| ||||||||
Internet & Direct Marketing Retail–6.04% |
| |||||||
Amazon.com, Inc.(b) | 191,183 | 662,911,758 | ||||||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 | Invesco Main Street Fund® |
Shares | Value | |||||||
| ||||||||
Internet Services & Infrastructure–0.12% |
| |||||||
Snowflake, Inc., Class A(b) | 55,467 | $ | 12,845,603 | |||||
| ||||||||
IT Consulting & Other Services–2.12% |
| |||||||
Accenture PLC, Class A | 574,243 | 166,513,243 | ||||||
| ||||||||
Amdocs Ltd. | 865,681 | 66,432,360 | ||||||
| ||||||||
232,945,603 | ||||||||
| ||||||||
Life Sciences Tools & Services–2.12% |
| |||||||
Avantor, Inc.(b) | 1,782,982 | 57,126,743 | ||||||
| ||||||||
Thermo Fisher Scientific, Inc. | 373,947 | 175,841,098 | ||||||
| ||||||||
232,967,841 | ||||||||
| ||||||||
Managed Health Care–3.35% | ||||||||
UnitedHealth Group, Inc. | 921,147 | 367,353,424 | ||||||
| ||||||||
Movies & Entertainment–1.47% | ||||||||
Netflix, Inc.(b) | 277,038 | 142,250,702 | ||||||
| ||||||||
Warner Music Group Corp., Class A | 507,961 | 19,282,199 | ||||||
| ||||||||
161,532,901 | ||||||||
| ||||||||
Oil & Gas Exploration & Production–0.59% |
| |||||||
Cabot Oil & Gas Corp. | 3,853,644 | 64,240,245 | ||||||
| ||||||||
Oil & Gas Refining & Marketing–0.63% |
| |||||||
Valero Energy Corp. | 941,603 | 69,640,958 | ||||||
| ||||||||
Oil & Gas Storage & Transportation–0.64% |
| |||||||
Magellan Midstream Partners L.P. | 1,501,338 | 70,217,578 | ||||||
| ||||||||
Other Diversified Financial Services–2.20% |
| |||||||
Equitable Holdings, Inc. | 7,048,607 | 241,273,818 | ||||||
| ||||||||
Packaged Foods & Meats–1.27% | ||||||||
a2 Milk Co. Ltd. (The) | 2,634,404 | 14,649,259 | ||||||
| ||||||||
Mondelez International, Inc., Class A | 2,047,093 | 124,483,725 | ||||||
| ||||||||
139,132,984 | ||||||||
| ||||||||
Pharmaceuticals–3.77% | ||||||||
AstraZeneca PLC, ADR (United Kingdom) | 4,032,386 | 213,998,725 | ||||||
| ||||||||
Eli Lilly and Co. | 1,094,030 | 199,955,863 | ||||||
| ||||||||
413,954,588 | ||||||||
| ||||||||
Property & Casualty Insurance–1.77% |
| |||||||
Allstate Corp. (The) | 459,286 | 58,237,465 | ||||||
| ||||||||
Progressive Corp. (The) | 1,354,928 | 136,495,447 | ||||||
| ||||||||
194,732,912 | ||||||||
| ||||||||
Railroads–1.20% | ||||||||
Union Pacific Corp. | 592,038 | 131,485,719 | ||||||
| ||||||||
Regional Banks–0.51% | ||||||||
CIT Group, Inc. | 1,045,479 | 55,713,576 | ||||||
|
Shares | Value | |||||||
| ||||||||
Semiconductor Equipment–2.38% |
| |||||||
Applied Materials, Inc. | 1,972,037 | $ | 261,709,030 | |||||
| ||||||||
Semiconductors–4.37% | ||||||||
QUALCOMM, Inc. | 2,020,455 | 280,439,154 | ||||||
| ||||||||
Texas Instruments, Inc. | 1,100,547 | 198,659,739 | ||||||
| ||||||||
479,098,893 | ||||||||
| ||||||||
Systems Software–8.15% | ||||||||
Microsoft Corp. | 3,316,913 | 836,459,121 | ||||||
| ||||||||
VMware, Inc., Class A(b)(c) | 357,940 | 57,567,490 | ||||||
| ||||||||
894,026,611 | ||||||||
| ||||||||
Technology Hardware, Storage & Peripherals–1.66% |
| |||||||
Apple, Inc. | 1,387,441 | 182,392,994 | ||||||
| ||||||||
Thrifts & Mortgage Finance–0.60% |
| |||||||
Rocket Cos., Inc., Class A | 2,951,813 | 66,268,202 | ||||||
| ||||||||
Water Utilities–0.45% | ||||||||
American Water Works Co., Inc. | 314,942 | 49,127,803 | ||||||
| ||||||||
Total Common Stocks & Other Equity Interests |
| 10,932,513,588 | ||||||
| ||||||||
Money Market Funds–0.52% |
| |||||||
Invesco Government & Agency Portfolio, Institutional Class, 0.03%(d)(e) | 20,012,347 | 20,012,347 | ||||||
| ||||||||
Invesco Liquid Assets Portfolio, Institutional Class, 0.01%(d)(e) | 14,034,900 | 14,040,513 | ||||||
| ||||||||
Invesco Treasury Portfolio, Institutional Class, 0.01%(d)(e) | 22,871,253 | 22,871,253 | ||||||
| ||||||||
Total Money Market Funds |
| 56,924,113 | ||||||
| ||||||||
TOTAL INVESTMENTS IN SECURITIES |
| 10,989,437,701 | ||||||
| ||||||||
Investments Purchased with Cash Collateral from Securities on Loan |
| |||||||
Money Market Funds–0.29% |
| |||||||
Invesco Private Government Fund, 0.01%(d)(e)(f) | 12,579,733 | 12,579,733 | ||||||
| ||||||||
Invesco Private Prime Fund, 0.11%(d)(e)(f) | 18,862,055 | 18,869,600 | ||||||
| ||||||||
Total Investments Purchased with Cash Collateral from Securities on Loan |
| 31,449,333 | ||||||
| ||||||||
TOTAL INVESTMENTS IN SECURITIES–100.41% |
| 11,020,887,034 | ||||||
| ||||||||
OTHER ASSETS LESS LIABILITIES–(0.41)% |
| (44,692,244 | ) | |||||
| ||||||||
NET ASSETS–100.00% | $ | 10,976,194,790 | ||||||
|
Investment Abbreviations:
ADR – American Depositary Receipt
REIT – Real Estate Investment Trust
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 | Invesco Main Street Fund® |
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2021. |
(d) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
Value October 31, 2020 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation | Realized Gain (Loss) | Value April 30, 2021 | Dividend Income | |||||||||||||||||||||||||||||
Investments in Affiliated Money Market Funds: |
| ||||||||||||||||||||||||||||||||||
Invesco Government & Agency Portfolio, Institutional Class | $ | 16,179,194 | $ | 242,131,286 | $ | (238,298,133 | ) | $ | - | $ | - | $ | 20,012,347 | $ | 1,868 | ||||||||||||||||||||
Invesco Liquid Assets Portfolio, Institutional Class | 6,348,183 | 172,950,919 | (165,259,069 | ) | 633 | (153 | ) | 14,040,513 | 1,705 | ||||||||||||||||||||||||||
Invesco Treasury Portfolio, Institutional Class | 18,490,508 | 276,721,469 | (272,340,724 | ) | - | - | 22,871,253 | 950 | |||||||||||||||||||||||||||
Investments Purchased with Cash Collateral from Securities on Loan: |
| ||||||||||||||||||||||||||||||||||
Invesco Private Government Fund | 39,425,342 | 134,593,907 | (161,439,516 | ) | - | - | 12,579,733 | 1,439 | * | ||||||||||||||||||||||||||
Invesco Private Prime Fund | 59,138,012 | 193,853,213 | (234,121,627 | ) | 2 | - | 18,869,600 | 9,508 | * | ||||||||||||||||||||||||||
Total | $ | 139,581,239 | $ | 1,020,250,794 | $ | (1,071,459,069 | ) | $ | 635 | $ | (153 | ) | $ | 88,373,446 | $ | 15,470 |
* | Represents the income earned on the investment of cash collateral, which is included in securities lending income on the Statement of Operations. Does not include rebates and fees paid to lending agent or premiums received from borrowers, if any. |
(e) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
(f) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 1I. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
Information Technology | 24.72 | % | |||
Consumer Discretionary | 14.57 | ||||
Health Care | 13.95 | ||||
Financials | 12.09 | ||||
Industrials | 10.35 | ||||
Communication Services | 10.07 | ||||
Consumer Staples | 6.16 | ||||
Real Estate | 2.48 | ||||
Other Sectors, Each Less than 2% of Net Assets | 5.21 | ||||
Money Market Funds Plus Other Assets Less Liabilities | 0.40 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 | Invesco Main Street Fund® |
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
Assets: | ||||
Investments in securities, at value | $ | 10,932,513,588 | ||
| ||||
Investments in affiliated money market funds, at value (Cost $88,373,446) | 88,373,446 | |||
| ||||
Foreign currencies, at value and cost | 143 | |||
| ||||
Receivable for: | ||||
Investments sold | 2,799,512 | |||
| ||||
Fund shares sold | 2,465,042 | |||
| ||||
Dividends | 6,902,646 | |||
| ||||
Investment for trustee deferred compensation and retirement plans | 981,007 | |||
| ||||
Other assets | 143,153 | |||
| ||||
Total assets | 11,034,178,537 | |||
| ||||
Liabilities: | ||||
Payable for: | ||||
Investments purchased | 12,274,965 | |||
| ||||
Fund shares reacquired | 6,872,566 | |||
| ||||
Amount due custodian | 1,028,126 | |||
| ||||
Collateral upon return of securities loaned | 31,449,333 | |||
| ||||
Accrued fees to affiliates | 4,615,418 | |||
| ||||
Accrued trustees’ and officers’ fees and benefits | 4,188 | |||
| ||||
Accrued other operating expenses | 758,144 | |||
| ||||
Trustee deferred compensation and retirement plans | 981,007 | |||
| ||||
Total liabilities | 57,983,747 | |||
| ||||
Net assets applicable to shares outstanding | $ | 10,976,194,790 | ||
| ||||
Net assets consist of: | ||||
Shares of beneficial interest | $ | 6,222,850,993 | ||
| ||||
Distributable earnings | 4,753,343,797 | |||
| ||||
$10,976,194,790 | ||||
|
Net Assets: | ||||
Class A | $ | 9,308,115,287 | ||
| ||||
Class C | $ | 304,079,579 | ||
| ||||
Class R | $ | 276,498,650 | ||
| ||||
Class Y | $ | 551,233,582 | ||
| ||||
Class R5 | $ | 13,325 | ||
| ||||
Class R6 | $ | 536,254,367 | ||
| ||||
Shares outstanding, no par value, with an unlimited number of shares authorized: |
| |||
Class A | 153,360,220 | |||
| ||||
Class C | 5,454,920 | |||
| ||||
Class R | 4,688,379 | |||
| ||||
Class Y | 9,151,598 | |||
| ||||
Class R5 | 218.37 | |||
| ||||
Class R6 | 8,903,034 | |||
| ||||
Class A: | ||||
Net asset value per share | $ | 60.69 | ||
| ||||
Maximum offering price per share | ||||
(Net asset value of $60.69 ÷ 94.50%) | $ | 64.22 | ||
| ||||
Class C: | ||||
Net asset value and offering price per share | $ | 55.74 | ||
| ||||
Class R: | ||||
Net asset value and offering price per share | $ | 58.98 | ||
| ||||
Class Y: | ||||
Net asset value and offering price per share | $ | 60.23 | ||
| ||||
Class R5: | ||||
Net asset value and offering price per share | $ | 61.02 | ||
| ||||
Class R6: | ||||
Net asset value and offering price per share | $ | 60.23 | ||
|
* | At April 30, 2021, securities with an aggregate value of $29,986,007 were on loan to brokers. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 | Invesco Main Street Fund® |
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
Investment income: | ||||
Dividends (net of foreign withholding taxes of $58,028) | $ | 81,253,801 | ||
| ||||
Dividends from affiliated money market funds (includes securities lending income of $146,749) | 151,272 | |||
| ||||
Total investment income | 81,405,073 | |||
| ||||
Expenses: | ||||
Advisory fees | 22,186,802 | |||
| ||||
Administrative services fees | 720,687 | |||
| ||||
Custodian fees | 23,890 | |||
| ||||
Distribution fees: | ||||
Class A | 9,665,964 | |||
| ||||
Class C | 1,499,337 | |||
| ||||
Class R | 624,379 | |||
| ||||
Transfer agent fees – A, C, R and Y | 6,397,068 | |||
| ||||
Transfer agent fees – R6 | 13,061 | |||
| ||||
Trustees’ and officers’ fees and benefits | 57,475 | |||
| ||||
Registration and filing fees | 100,390 | |||
| ||||
Reports to shareholders | 255,384 | |||
| ||||
Professional services fees | 54,915 | |||
| ||||
Other | 129,923 | |||
| ||||
Total expenses | 41,729,275 | |||
| ||||
Less: Fees waived and/or expense offset arrangement(s) | (35,639 | ) | ||
| ||||
Net expenses | 41,693,636 | |||
| ||||
Net investment income | 39,711,437 | |||
| ||||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Unaffiliated investment securities | 660,156,205 | |||
| ||||
Affiliated investment securities | (153 | ) | ||
| ||||
Foreign currencies | 3,945 | |||
| ||||
660,159,997 | ||||
| ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Unaffiliated investment securities | 1,801,411,470 | |||
| ||||
Affiliated investment securities | 635 | |||
| ||||
Foreign currencies | (1 | ) | ||
| ||||
1,801,412,104 | ||||
| ||||
Net realized and unrealized gain | 2,461,572,101 | |||
| ||||
Net increase in net assets resulting from operations | $ | 2,501,283,538 | ||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 | Invesco Main Street Fund® |
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
April 30, 2021 | October 31, 2020 | |||||||
| ||||||||
Operations: | ||||||||
Net investment income | $ | 39,711,437 | $ | 83,685,259 | ||||
| ||||||||
Net realized gain | 660,159,997 | 234,091,873 | ||||||
| ||||||||
Change in net unrealized appreciation | 1,801,412,104 | 305,589,753 | ||||||
| ||||||||
Net increase in net assets resulting from operations | 2,501,283,538 | 623,366,885 | ||||||
| ||||||||
Distributions to shareholders from distributable earnings: | ||||||||
Class A | (257,778,336 | ) | (629,335,556 | ) | ||||
| ||||||||
Class C | (10,580,723 | ) | (29,117,121 | ) | ||||
| ||||||||
Class R | (7,703,892 | ) | (18,474,893 | ) | ||||
| ||||||||
Class Y | (15,724,229 | ) | (51,123,360 | ) | ||||
| ||||||||
Class R5 | (376 | ) | (903 | ) | ||||
| ||||||||
Class R6 | (15,515,693 | ) | (39,950,554 | ) | ||||
| ||||||||
Total distributions from distributable earnings | (307,303,249 | ) | (768,002,387 | ) | ||||
| ||||||||
Share transactions–net: | ||||||||
Class A | (51,385,855 | ) | (81,425,725 | ) | ||||
| ||||||||
Class C | (60,665,868 | ) | (35,320,624 | ) | ||||
| ||||||||
Class R | 2,282,447 | 1,681,926 | ||||||
| ||||||||
Class Y | (1,882,617 | ) | (134,433,972 | ) | ||||
| ||||||||
Class R6 | (10,392,745 | ) | (176,423,631 | ) | ||||
| ||||||||
Net increase (decrease) in net assets resulting from share transactions | (122,044,638 | ) | (425,922,026 | ) | ||||
| ||||||||
Net increase (decrease) in net assets | 2,071,935,651 | (570,557,528 | ) | |||||
| ||||||||
Net assets: | ||||||||
Beginning of period | 8,904,259,139 | 9,474,816,667 | ||||||
| ||||||||
End of period | $ | 10,976,194,790 | $ | 8,904,259,139 | ||||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 | Invesco Main Street Fund® |
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed(c) | Ratio of net investment income to average net assets | Portfolio turnover(d) | |||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | $ | 48.70 | $ | 0.22 | $ | 13.46 | $ | 13.68 | $ | (0.44 | ) | $ | (1.25 | ) | $ | (1.69 | ) | $ | 60.69 | 28.63 | %(e) | $ | 9,308,115 | 0.83 | %(e)(f) | 0.83 | %(e)(f) | 0.80 | %(e)(f) | 23 | % | |||||||||||||||||||||||||
Year ended 10/31/20 | 49.26 | 0.44 | 3.08 | 3.52 | (0.43 | ) | (3.65 | ) | (4.08 | ) | 48.70 | 7.38 | (e) | 7,502,604 | 0.83 | (e) | 0.83 | (e) | 0.93 | (e) | 37 | |||||||||||||||||||||||||||||||||||
Two months ended 10/31/19 | 48.16 | 0.07 | 1.03 | 1.10 | — | — | — | 49.26 | 2.28 | 7,681,783 | 0.85 | (g) | 0.85 | (g) | 0.81 | (g) | 7 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/19 | 54.31 | 0.49 | 1.14 | 1.63 | (0.49 | ) | (7.29 | ) | (7.78 | ) | 48.16 | 5.14 | 7,625,507 | 0.88 | 0.88 | 1.03 | 49 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/18 | 52.61 | 0.45 | 5.08 | 5.53 | (0.55 | ) | (3.28 | ) | (3.83 | ) | 54.31 | 10.99 | 7,579,158 | 0.90 | 0.90 | 0.87 | 56 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/17 | 46.57 | 0.53 | 6.90 | 7.43 | (0.51 | ) | (0.88 | ) | (1.39 | ) | 52.61 | 16.27 | 7,436,792 | 0.93 | 0.93 | 1.08 | 40 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/16 | 47.64 | 0.50 | 4.41 | 4.91 | (0.43 | ) | (5.55 | ) | (5.98 | ) | 46.57 | 11.22 | 5,488,385 | 0.93 | 0.93 | 1.12 | 39 | |||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 44.96 | 0.01 | 12.40 | 12.41 | (0.38 | ) | (1.25 | ) | (1.63 | ) | 55.74 | 28.15 | 304,080 | 1.60 | (f) | 1.60 | (f) | 0.03 | (f) | 23 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 45.99 | 0.07 | 2.86 | 2.93 | (0.31 | ) | (3.65 | ) | (3.96 | ) | 44.96 | 6.55 | 300,125 | 1.60 | 1.60 | 0.16 | 37 | |||||||||||||||||||||||||||||||||||||||
Two months ended 10/31/19 | 45.03 | 0.00 | 0.96 | 0.96 | — | — | — | 45.99 | 2.13 | 343,918 | 1.62 | (g) | 1.62 | (g) | 0.04 | (g) | 7 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/19 | 51.26 | 0.11 | 1.06 | 1.17 | (0.11 | ) | (7.29 | ) | (7.40 | ) | 45.03 | 4.34 | 350,276 | 1.65 | 1.65 | 0.26 | 49 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/18 | 49.85 | 0.05 | 4.81 | 4.86 | (0.17 | ) | (3.28 | ) | (3.45 | ) | 51.26 | 10.16 | 810,071 | 1.67 | 1.67 | 0.11 | 56 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/17 | 44.24 | 0.15 | 6.54 | 6.69 | (0.20 | ) | (0.88 | ) | (1.08 | ) | 49.85 | 15.39 | 826,928 | 1.68 | 1.68 | 0.32 | 40 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/16 | 45.51 | 0.16 | 4.21 | 4.37 | (0.09 | ) | (5.55 | ) | (5.64 | ) | 44.24 | 10.39 | 705,167 | 1.69 | 1.69 | 0.36 | 39 | |||||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 47.40 | 0.14 | 13.11 | 13.25 | (0.42 | ) | (1.25 | ) | (1.67 | ) | 58.98 | 28.49 | 276,499 | 1.10 | (f) | 1.10 | (f) | 0.53 | (f) | 23 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 48.13 | 0.30 | 3.00 | 3.30 | (0.38 | ) | (3.65 | ) | (4.03 | ) | 47.40 | 7.09 | 219,954 | 1.10 | 1.10 | 0.66 | 37 | |||||||||||||||||||||||||||||||||||||||
Two months ended 10/31/19 | 47.08 | 0.04 | 1.01 | 1.05 | — | — | — | 48.13 | 2.23 | 221,335 | 1.12 | (g) | 1.12 | (g) | 0.54 | (g) | 7 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/19 | 53.26 | 0.35 | 1.11 | 1.46 | (0.35 | ) | (7.29 | ) | (7.64 | ) | 47.08 | 4.84 | 218,620 | 1.15 | 1.15 | 0.76 | 49 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/18 | 51.70 | 0.31 | 4.98 | 5.29 | (0.45 | ) | (3.28 | ) | (3.73 | ) | 53.26 | 10.70 | 223,733 | 1.17 | 1.17 | 0.61 | 56 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/17 | 45.82 | 0.40 | 6.77 | 7.17 | (0.41 | ) | (0.88 | ) | (1.29 | ) | 51.70 | 15.99 | 189,337 | 1.18 | 1.18 | 0.82 | 40 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/16 | 46.95 | 0.38 | 4.36 | 4.74 | (0.32 | ) | (5.55 | ) | (5.87 | ) | 45.82 | 10.94 | 132,365 | 1.19 | 1.19 | 0.86 | 39 | |||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 48.31 | 0.28 | 13.35 | 13.63 | (0.46 | ) | (1.25 | ) | (1.71 | ) | 60.23 | 28.77 | 551,234 | 0.60 | (f) | 0.60 | (f) | 1.03 | (f) | 23 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 48.82 | 0.54 | 3.07 | 3.61 | (0.47 | ) | (3.65 | ) | (4.12 | ) | 48.31 | 7.64 | 443,001 | 0.60 | 0.60 | 1.16 | 37 | |||||||||||||||||||||||||||||||||||||||
Two months ended 10/31/19 | 47.72 | 0.08 | 1.02 | 1.10 | — | — | — | 48.82 | 2.31 | 611,287 | 0.62 | (g) | 0.62 | (g) | 1.04 | (g) | 7 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/19 | 53.90 | 0.59 | 1.13 | 1.72 | (0.61 | ) | (7.29 | ) | (7.90 | ) | 47.72 | 5.37 | 590,781 | 0.65 | 0.65 | 1.26 | 49 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/18 | 52.25 | 0.57 | 5.03 | 5.60 | (0.67 | ) | (3.28 | ) | (3.95 | ) | 53.90 | 11.25 | 820,422 | 0.67 | 0.67 | 1.10 | 56 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/17 | 46.26 | 0.64 | 6.85 | 7.49 | (0.62 | ) | (0.88 | ) | (1.50 | ) | 52.25 | 16.55 | 778,910 | 0.69 | 0.69 | 1.32 | 40 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/16 | 47.37 | 0.62 | 4.37 | 4.99 | (0.55 | ) | (5.55 | ) | (6.10 | ) | 46.26 | 11.49 | 632,805 | 0.69 | 0.69 | 1.39 | 39 | |||||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 48.89 | 0.32 | 13.53 | 13.85 | (0.47 | ) | (1.25 | ) | (1.72 | ) | 61.02 | 28.88 | 13 | 0.47 | (f) | 0.47 | (f) | 1.16 | (f) | 23 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 49.33 | 0.61 | 3.08 | 3.69 | (0.48 | ) | (3.65 | ) | (4.13 | ) | 48.89 | 7.75 | 11 | 0.48 | 0.48 | 1.28 | 37 | |||||||||||||||||||||||||||||||||||||||
Two months ended 10/31/19 | 48.20 | 0.09 | 1.04 | 1.13 | — | — | — | 49.33 | 2.34 | 11 | 0.52 | (g) | 0.52 | (g) | 1.14 | (g) | 7 | |||||||||||||||||||||||||||||||||||||||
Period ended 08/31/19(h) | 45.79 | 0.18 | 2.23 | 2.41 | — | — | — | 48.20 | 5.26 | 11 | 0.54 | (g) | 0.54 | (g) | 1.37 | (g) | 49 | |||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 48.28 | 0.31 | 13.36 | 13.67 | (0.47 | ) | (1.25 | ) | (1.72 | ) | 60.23 | 28.87 | 536,254 | 0.48 | (f) | 0.48 | (f) | 1.15 | (f) | 23 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 48.77 | 0.60 | 3.05 | 3.65 | (0.49 | ) | (3.65 | ) | (4.14 | ) | 48.28 | 7.75 | 438,565 | 0.48 | 0.48 | 1.28 | 37 | |||||||||||||||||||||||||||||||||||||||
Two months ended 10/31/19 | 47.66 | 0.09 | 1.02 | 1.11 | — | — | — | 48.77 | 2.33 | 616,482 | 0.48 | (g) | 0.48 | (g) | 1.18 | (g) | 7 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/19 | 53.87 | 0.66 | 1.12 | 1.78 | (0.70 | ) | (7.29 | ) | (7.99 | ) | 47.66 | 5.55 | 621,207 | 0.49 | 0.49 | 1.42 | 49 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/18 | 52.22 | 0.66 | 5.03 | 5.69 | (0.76 | ) | (3.28 | ) | (4.04 | ) | 53.87 | 11.45 | 720,854 | 0.50 | 0.50 | 1.27 | 56 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/17 | 46.25 | 0.73 | 6.83 | 7.56 | (0.71 | ) | (0.88 | ) | (1.59 | ) | 52.22 | 16.76 | 756,378 | 0.50 | 0.50 | 1.49 | 40 | |||||||||||||||||||||||||||||||||||||||
Year ended 08/31/16 | 47.36 | 0.67 | 4.42 | 5.09 | (0.65 | ) | (5.55 | ) | (6.20 | ) | 46.25 | 11.72 | 589,459 | 0.50 | 0.50 | 1.50 | 39 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Does not include estimated acquired fund fees from underlying funds of 0.00% for the two months ended October 31, 2019 and the years ended August 31, 2019, 2018, 2017 and 2016, respectively. |
(d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(e) | The total return, ratio of expenses to average net assets and ratio of net investment income (loss) to average net assets reflect actual 12b-1 fees of 0.23% for the six months ended April 30, 2021 and the year ended October 31, 2020. |
(f) | Ratios are annualized and based on average daily net assets (000’s omitted) of $8,540,684, $302,352, $251,821, $505,764, $12 and $496,962 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(g) | Annualized. |
(h) | Commencement date after the close of business on May 24, 2019. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 | Invesco Main Street Fund® |
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Main Street Fund® (the “Fund”) is a series portfolio of AIM Equity Funds (Invesco Equity Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek capital appreciation.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
12 | Invesco Main Street Fund® |
settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Securities Lending – The Fund may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by collateral equal to no less than the market value of the loaned securities determined daily by the securities lending provider. Such collateral will be cash or debt securities issued or guaranteed by the U.S. Government or any of its sponsored agencies. Cash collateral received in connection with these loans is invested in short-term money market instruments or affiliated money market funds and is shown as such on the Schedule of Investments. The Fund bears the risk of loss with respect to the investment of collateral. It is the Fund’s policy to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be temporarily less than the value of the securities on loan. When loaning securities, the Fund retains certain benefits of owning the securities, including the economic equivalent of dividends or interest generated by the security. Lending securities entails a risk of loss to the Fund if, and to the extent that, the market value of the securities loaned were to increase and the borrower did not increase the collateral accordingly, and the borrower failed to return the securities. The securities loaned are subject to termination at the option of the borrower or the Fund. Upon termination, the borrower will return to the Fund the securities loaned and the Fund will return the collateral. Upon the failure of the borrower to return the securities, collateral may be liquidated and the securities may be purchased on the open market to replace the loaned securities. The Fund could experience delays and costs in gaining access to the collateral and the securities may lose value during the delay which could result in potential losses to the Fund. Some of these losses may be indemnified by the lending agent. The Fund bears the risk of any deficiency in the amount of the collateral available for return to the borrower due to any loss on the collateral invested. Dividends received on cash collateral investments for securities lending transactions, which are net of compensation to counterparties, are included in Dividends from affiliated money market funds on the Statement of Operations. The aggregate value of securities out on loan, if any, is shown as a footnote on the Statement of Assets and Liabilities. |
J. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized |
13 | Invesco Main Street Fund® |
foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
K. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
L. | COVID-19 Risk - The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets* | Rate | |||
| ||||
Up to $200 million | 0.650% | |||
| ||||
Next $150 million | 0.600% | |||
| ||||
Next $150 million | 0.550% | |||
| ||||
Next $9.5 billion | 0.450% | |||
| ||||
Next $10 billion | 0.430% | |||
|
* | The advisory fee paid by the Fund shall be reduced by any amounts paid by the Fund under the administrative services agreement with the Adviser. |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.44%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through May 31, 2021, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 0.92%, 1.68%, 1.18%, 0.67%, 0.55% and 0.50% , respectively, of the Fund’s average daily net assets (the “expense limits”). Effective June 1, 2021 through at least June 30, 2022, the Adviser has contractually agreed to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.00%, 2.75%, 2.25%, 1.75%, 1.75% and 1.75%, respectively, of the Fund’s average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under this expense limit.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $18,118.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Class A Plan, reimburses IDI for its allocated share of expenses incurred for the period, up to a
14 | Invesco Main Street Fund® |
maximum annual rate of 0.25% of the average daily net assets of Class A shares. The Fund pursuant to the Class C and Class R Plan, pays IDI compensation at the annual rate of 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $394,534 in front-end sales commissions from the sale of Class A shares and $7,471 and $5,976 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $10,616 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 – | Prices are determined using quoted prices in an active market for identical assets. | |
Level 2 – | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. | |
Level 3 – | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| ||||||||||||||||
Investments in Securities | ||||||||||||||||
| ||||||||||||||||
Common Stocks & Other Equity Interests | $ | 10,881,010,634 | $ | 51,502,954 | $ | – | $ | 10,932,513,588 | ||||||||
| ||||||||||||||||
Money Market Funds | 56,924,113 | 31,449,333 | – | 88,373,446 | ||||||||||||
| ||||||||||||||||
Total Investments | $ | 10,937,934,747 | $ | 82,952,287 | $ | – | $ | 11,020,887,034 | ||||||||
|
NOTE 4–Security Transactions with Affiliated Funds
The Fund is permitted to purchase or sell securities from or to certain other Invesco Funds under specified conditions outlined in procedures adopted by the Board of Trustees of the Trust. The procedures have been designed to ensure that any purchase or sale of securities by the Fund from or to another fund or portfolio that is or could be considered an affiliate by virtue of having a common investment adviser (or affiliated investment advisers), common Trustees and/or common officers complies with Rule 17a-7 of the 1940 Act. Further, as defined under the procedures, each transaction is effected at the current market price. Pursuant to these procedures, for the six months ended April 30, 2021, the Fund engaged in securities purchases of $19,374,732.
NOTE 5–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $17,521.
NOTE 6–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 7–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
15 | Invesco Main Street Fund® |
NOTE 8–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 9–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $2,303,392,009 and $2,690,487,079, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
| ||||
Aggregate unrealized appreciation of investments | $ | 4,147,136,603 | ||
| ||||
Aggregate unrealized (depreciation) of investments | (43,292,895 | ) | ||
| ||||
Net unrealized appreciation of investments | $ | 4,103,843,708 | ||
|
Cost of investments for tax purposes is $6,917,043,326.
NOTE 10–Share Information
Summary of Share Activity | ||||||||||||||||
| ||||||||||||||||
Six months ended April 30, 2021(a) | Year ended October 31, 2020 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
| ||||||||||||||||
Sold: | ||||||||||||||||
Class A | 3,488,939 | $ | 192,369,249 | 8,569,917 | $ | 394,397,361 | ||||||||||
| ||||||||||||||||
Class C | 421,893 | 21,411,943 | 1,241,750 | 52,458,227 | ||||||||||||
| ||||||||||||||||
Class R | 364,771 | 19,578,058 | 876,934 | 39,615,149 | ||||||||||||
| ||||||||||||||||
Class Y | 1,027,826 | 56,268,865 | 2,682,636 | 123,582,993 | ||||||||||||
| ||||||||||||||||
Class R6 | 812,113 | 44,851,967 | 1,815,544 | 81,714,395 | ||||||||||||
| ||||||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 4,665,118 | 245,245,286 | 12,672,000 | 600,019,235 | ||||||||||||
| ||||||||||||||||
Class C | 213,679 | 10,346,340 | 643,978 | 28,341,466 | ||||||||||||
| ||||||||||||||||
Class R | 149,808 | 7,659,671 | 397,082 | 18,345,202 | ||||||||||||
| ||||||||||||||||
Class Y | 275,171 | 14,344,649 | 1,013,709 | 47,512,553 | ||||||||||||
| ||||||||||||||||
Class R6 | 294,840 | 15,361,145 | 844,968 | 39,544,528 | ||||||||||||
| ||||||||||||||||
Automatic conversion of Class C shares to Class A shares: | ||||||||||||||||
Class A | 1,075,900 | 57,700,376 | 590,822 | 27,863,074 | ||||||||||||
| ||||||||||||||||
Class C | (1,168,672 | ) | (57,700,375 | ) | (637,684 | ) | (27,863,074 | ) | ||||||||
| ||||||||||||||||
Reacquired: | ||||||||||||||||
Class A | (9,928,176 | ) | (546,700,766 | ) | (23,727,968 | ) | (1,103,705,395 | ) | ||||||||
| ||||||||||||||||
Class C | (686,790 | ) | (34,723,776 | ) | (2,051,300 | ) | (88,257,243 | ) | ||||||||
| ||||||||||||||||
Class R | (466,109 | ) | (24,955,282 | ) | (1,232,556 | ) | (56,278,425 | ) | ||||||||
| ||||||||||||||||
Class Y | (1,322,153 | ) | (72,496,131 | ) | (7,046,871 | ) | (305,529,518 | ) | ||||||||
| ||||||||||||||||
Class R6 | (1,286,756 | ) | (70,605,857 | ) | (6,218,156 | ) | (297,682,554 | ) | ||||||||
| ||||||||||||||||
Net increase (decrease) in share activity | (2,068,598 | ) | $ | (122,044,638 | ) | (9,565,195 | ) | $ | (425,922,026 | ) | ||||||
|
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 13% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
16 | Invesco Main Street Fund® |
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
ACTUAL | HYPOTHETICAL (5% annual return before | |||||||||||
Beginning Account Value (11/01/20) | Ending Account Value (04/30/21)1 | Expenses Paid During Period2 | Ending Account Value (04/30/21) | Expenses Paid During Period2 | Annualized Expense Ratio | |||||||
Class A | $1,000.00 | $1,286.30 | $4.71 | $1,020.68 | $4.16 | 0.83% | ||||||
Class C | 1,000.00 | 1,281.50 | 9.05 | 1,016.86 | 8.00 | 1.60 | ||||||
Class R | 1,000.00 | 1,284.90 | 6.23 | 1,019.34 | 5.51 | 1.10 | ||||||
Class Y | 1,000.00 | 1,287.70 | 3.40 | 1,021.82 | 3.01 | 0.60 | ||||||
Class R5 | 1,000.00 | 1,288.80 | 2.67 | 1,022.46 | 2.36 | 0.47 | ||||||
Class R6 | 1,000.00 | 1,288.70 | 2.72 | 1,022.41 | 2.41 | 0.48 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
17 | Invesco Main Street Fund® |
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ | Fund reports and prospectuses |
∎ | Quarterly statements |
∎ | Daily confirmations |
∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-01424 and 002-25469 | Invesco Distributors, Inc. | O-MST-SAR-1 |
|
| |||
Semiannual Report to Shareholders |
April 30, 2021 | |||
| ||||
Invesco Rising Dividends Fund | ||||
Nasdaq: | ||||
A: OARDX ∎ C: OCRDX ∎ R: ONRDX ∎ Y: OYRDX ∎ R5: RSDQX ∎ R6: OIRDX | ||||
2 | Fund Performance | |||||
4 | Liquidity Risk Management Program | |||||
5 | Schedule of Investments | |||||
8 | Financial Statements | |||||
11 | Financial Highlights | |||||
12 | Notes to Financial Statements | |||||
17 | Fund Expenses |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
Performance summary |
| |||
Fund vs. Indexes |
| |||
Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 24.30 | % | ||
Class C Shares | 23.85 | |||
Class R Shares | 24.19 | |||
Class Y Shares | 24.50 | |||
Class R5 Shares | 24.53 | |||
Class R6 Shares | 24.53 | |||
S&P 500 Index▼ | 28.85 | |||
Russell 1000 Index▼ | 30.03 | |||
Source(s): ▼RIMES Technologies Corp. | ||||
The S&P 500® Index is an unmanaged index considered representative of the US stock market. |
| |||
The Russell 1000® Index is an unmanaged index considered representative of large-cap stocks. The Russell 1000 Index is a trademark/service mark of the Frank Russell Co. Russell® is a trademark of the Frank Russell Co. |
| |||
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). |
| |||
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
|
For more information about your Fund |
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance. |
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their in-sights about market and economic news and trends. |
2 | Invesco Rising Dividends Fund |
Average Annual Total Returns |
| |||
As of 4/30/21, including maximum applicable sales charges |
| |||
Class A Shares | ||||
Inception (4/30/80) | 12.16 | % | ||
10 Years | 9.90 | |||
5 Years | 12.01 | |||
1 Year | 32.60 | |||
Class C Shares | ||||
Inception (9/1/93) | 8.84 | % | ||
10 Years | 9.85 | |||
5 Years | 12.44 | |||
1 Year | 38.27 | |||
Class R Shares | ||||
Inception (3/1/01) | 7.06 | % | ||
10 Years | 10.21 | |||
5 Years | 13.00 | |||
1 Year | 39.97 | |||
Class Y Shares | ||||
Inception (12/16/96) | 8.26 | % | ||
10 Years | 10.77 | |||
5 Years | 13.56 | |||
1 Year | 40.61 | |||
Class R5 Shares | ||||
10 Years | 10.60 | % | ||
5 Years | 13.45 | |||
1 Year | 40.82 | |||
Class R6 Shares | ||||
Inception (2/28/12) | 11.68 | % | ||
5 Years | 13.74 | |||
1 Year | 40.79 |
Effective May 24, 2019, Class A, Class C, Class R, Class Y and Class I shares of the Oppenheimer Rising Dividend Fund, (the predecessor fund), were reorganized into Class A, Class C, Class R, Class Y and Class R6 shares, respectively, of the Invesco Oppenheimer Rising Dividend Fund. Note: The Fund was subsequently renamed the Invesco Rising Dividends Fund (the Fund). Returns shown above, for periods ending on or prior to May 24, 2019, for Class A, Class C, Class R, Class Y and Class R6 shares are those for Class A, Class C, Class R, Class Y and Class I shares of the predecessor fund. Share class returns will differ from the predecessor fund because of different expenses.
Class R5 shares incepted on May 24, 2019. Performance shown on and prior to that date is that of the predecessor fund’s Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on
Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
3 | Invesco Rising Dividends Fund |
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 | Invesco Rising Dividends Fund |
April 30, 2021
(Unaudited)
Shares | Value | |||||||
| ||||||||
Common Stocks & Other Equity Interests–99.35% |
| |||||||
Aerospace & Defense–2.14% |
| |||||||
Lockheed Martin Corp. | 104,506 | $ | 39,770,804 | |||||
| ||||||||
Raytheon Technologies Corp. | 298,989 | 24,887,844 | ||||||
| ||||||||
64,658,648 | ||||||||
| ||||||||
Air Freight & Logistics–1.91% |
| |||||||
United Parcel Service, Inc., Class B | 283,308 | 57,755,169 | ||||||
| ||||||||
Apparel Retail–1.47% |
| |||||||
Ross Stores, Inc. | 339,372 | 44,437,370 | ||||||
| ||||||||
Application Software–0.85% |
| |||||||
Citrix Systems, Inc. | 207,786 | 25,734,296 | ||||||
| ||||||||
Asset Management & Custody Banks–0.83% |
| |||||||
BlackRock, Inc. | 30,710 | 25,160,703 | ||||||
| ||||||||
Biotechnology–0.85% |
| |||||||
Amgen, Inc. | 107,002 | 25,641,959 | ||||||
| ||||||||
Cable & Satellite–2.29% |
| |||||||
Comcast Corp., Class A | 1,229,440 | 69,033,056 | ||||||
| ||||||||
Construction Materials–0.58% |
| |||||||
Vulcan Materials Co. | 97,860 | 17,442,566 | ||||||
| ||||||||
Consumer Finance–1.53% |
| |||||||
American Express Co. | 301,729 | 46,270,142 | ||||||
| ||||||||
Data Processing & Outsourced Services–4.22% |
| |||||||
Fidelity National Information Services, Inc. | 262,406 | 40,121,877 | ||||||
| ||||||||
Visa, Inc., Class A | 373,114 | 87,144,506 | ||||||
| ||||||||
127,266,383 | ||||||||
| ||||||||
Distillers & Vintners–0.87% |
| |||||||
Constellation Brands, Inc., Class A | 108,770 | 26,139,606 | ||||||
| ||||||||
Diversified Banks–2.78% |
| |||||||
JPMorgan Chase & Co. | 545,735 | 83,939,500 | ||||||
| ||||||||
Electric Utilities–1.72% |
| |||||||
American Electric Power Co., Inc. | 212,082 | 18,813,794 | ||||||
| ||||||||
NextEra Energy, Inc. | 425,979 | 33,017,632 | ||||||
| ||||||||
51,831,426 | ||||||||
| ||||||||
Electrical Components & Equipment–0.78% |
| |||||||
Rockwell Automation, Inc. | 89,086 | 23,541,866 | ||||||
| ||||||||
Electronic Manufacturing Services–0.84% |
| |||||||
TE Connectivity Ltd. | 187,433 | 25,204,116 | ||||||
| ||||||||
Environmental & Facilities Services–0.96% |
| |||||||
Republic Services, Inc. | 271,544 | 28,865,127 | ||||||
| ||||||||
Financial Exchanges & Data–3.79% |
| |||||||
CME Group, Inc., Class A | 110,958 | 22,412,407 | ||||||
| ||||||||
Intercontinental Exchange, Inc. | 313,682 | 36,923,508 | ||||||
| ||||||||
S&P Global, Inc. | 140,662 | 54,913,038 | ||||||
| ||||||||
114,248,953 | ||||||||
|
Shares | Value | |||||||
| ||||||||
Food Distributors–0.86% |
| |||||||
Sysco Corp. | 307,101 | $ | 26,020,668 | |||||
| ||||||||
Footwear–1.36% |
| |||||||
NIKE, Inc., Class B | 309,345 | 41,025,334 | ||||||
| ||||||||
Gas Utilities–0.94% |
| |||||||
Atmos Energy Corp. | 273,884 | 28,371,644 | ||||||
| ||||||||
General Merchandise Stores–1.78% |
| |||||||
Dollar General Corp. | 111,776 | 24,003,896 | ||||||
| ||||||||
Target Corp. | 142,563 | 29,547,607 | ||||||
| ||||||||
53,551,503 | ||||||||
| ||||||||
Health Care Equipment–4.17% |
| |||||||
Abbott Laboratories | 290,593 | 34,894,407 | ||||||
| ||||||||
Danaher Corp. | 187,040 | 47,496,938 | ||||||
| ||||||||
Stryker Corp. | 165,080 | 43,354,960 | ||||||
| ||||||||
125,746,305 | ||||||||
| ||||||||
Home Improvement Retail–2.60% |
| |||||||
Home Depot, Inc. (The) | 242,515 | 78,494,830 | ||||||
| ||||||||
Household Products–1.04% |
| |||||||
Reckitt Benckiser Group PLC (United Kingdom) | 351,975 | 31,374,226 | ||||||
| ||||||||
Hypermarkets & Super Centers–1.21% |
| |||||||
Costco Wholesale Corp. | 97,843 | 36,406,402 | ||||||
| ||||||||
Industrial Conglomerates–1.70% |
| |||||||
Honeywell International, Inc. | 229,393 | 51,163,815 | ||||||
| ||||||||
Industrial Gases–1.29% |
| |||||||
Air Products and Chemicals, Inc. | 134,754 | 38,873,834 | ||||||
| ||||||||
Industrial Machinery–1.52% |
| |||||||
Otis Worldwide Corp. | 367,102 | 28,586,233 | ||||||
| ||||||||
Stanley Black & Decker, Inc. | 84,013 | 17,371,368 | ||||||
| ||||||||
45,957,601 | ||||||||
| ||||||||
Industrial REITs–1.71% |
| |||||||
Prologis, Inc. | 443,986 | 51,737,689 | ||||||
| ||||||||
Insurance Brokers–1.51% |
| |||||||
Marsh & McLennan Cos., Inc. | 336,765 | 45,699,010 | ||||||
| ||||||||
Integrated Oil & Gas–1.26% |
| |||||||
Chevron Corp. | 369,192 | 38,052,619 | ||||||
| ||||||||
Integrated Telecommunication Services–1.56% |
| |||||||
Verizon Communications, Inc. | 813,290 | 47,000,029 | ||||||
| ||||||||
Interactive Home Entertainment–1.06% |
| |||||||
Electronic Arts, Inc. | 224,733 | 31,930,065 | ||||||
| ||||||||
Internet & Direct Marketing Retail–0.45% |
| |||||||
eBay, Inc. | 244,590 | 13,645,676 | ||||||
| ||||||||
IT Consulting & Other Services–2.12% |
| |||||||
Accenture PLC, Class A | 220,704 | 63,997,539 | ||||||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 | Invesco Rising Dividends Fund |
Shares | Value | |||||||
| ||||||||
Life Sciences Tools & Services–3.15% |
| |||||||
Lonza Group AG (Switzerland) | 56,426 | $ | 35,905,687 | |||||
| ||||||||
Thermo Fisher Scientific, Inc. | 126,041 | 59,268,259 | ||||||
| ||||||||
95,173,946 | ||||||||
| ||||||||
Managed Health Care–2.92% |
| |||||||
UnitedHealth Group, Inc. | 220,720 | 88,023,136 | ||||||
| ||||||||
Movies & Entertainment–1.58% |
| |||||||
Vivendi SE (France) | 241,116 | 8,404,802 | ||||||
| ||||||||
Walt Disney Co. (The)(b) | 211,336 | 39,312,723 | ||||||
| ||||||||
47,717,525 | ||||||||
| ||||||||
Office REITs–0.90% |
| |||||||
Alexandria Real Estate Equities, Inc. | 150,067 | 27,177,134 | ||||||
| ||||||||
Oil & Gas Refining & Marketing–0.78% |
| |||||||
Valero Energy Corp. | 320,160 | 23,679,034 | ||||||
| ||||||||
Pharmaceuticals–3.82% |
| |||||||
AstraZeneca PLC, ADR (United Kingdom) | 551,722 | 29,279,887 | ||||||
| ||||||||
Eli Lilly and Co. | 271,204 | 49,567,955 | ||||||
| ||||||||
Zoetis, Inc. | 210,317 | 36,391,150 | ||||||
| ||||||||
115,238,992 | ||||||||
| ||||||||
Property & Casualty Insurance–0.84% |
| |||||||
Allstate Corp. (The) | 199,821 | 25,337,303 | ||||||
| ||||||||
Railroads–1.50% |
| |||||||
Union Pacific Corp. | 203,201 | 45,128,910 | ||||||
| ||||||||
Regional Banks–1.72% |
| |||||||
PNC Financial Services Group, Inc. (The) | 277,014 | 51,787,767 | ||||||
| ||||||||
Restaurants–1.50% |
| |||||||
McDonald’s Corp. | 191,738 | 45,265,507 | ||||||
| ||||||||
Semiconductor Equipment–2.36% |
| |||||||
Applied Materials, Inc. | 330,538 | 43,865,698 | ||||||
| ||||||||
ASML Holding N.V., New York Shares (Netherlands) | 42,209 | 27,355,653 | ||||||
| ||||||||
71,221,351 | ||||||||
|
Shares | Value | |||||||
| ||||||||
Semiconductors–3.19% |
| |||||||
QUALCOMM, Inc. | 320,199 | $ | 44,443,621 | |||||
| ||||||||
Texas Instruments, Inc. | 286,200 | 51,661,962 | ||||||
| ||||||||
96,105,583 | ||||||||
| ||||||||
Soft Drinks–2.51% |
| |||||||
Coca-Cola Co. (The) | 652,237 | 35,207,753 | ||||||
| ||||||||
PepsiCo, Inc. | 281,412 | 40,568,354 | ||||||
| ||||||||
75,776,107 | ||||||||
| ||||||||
Specialized REITs–1.73% |
| |||||||
American Tower Corp. | 204,539 | 52,110,401 | ||||||
| ||||||||
Systems Software–6.53% |
| |||||||
Microsoft Corp. | 781,619 | 197,108,679 | ||||||
| ||||||||
Technology Hardware, Storage & Peripherals–6.91% |
| |||||||
Apple, Inc. | 1,586,418 | 208,550,510 | ||||||
| ||||||||
Trading Companies & Distributors–0.86% |
| |||||||
Fastenal Co. | 494,924 | 25,874,627 | ||||||
| ||||||||
Total Common Stocks & Other Equity Interests (Cost $1,806,986,796) |
| 2,997,496,187 | ||||||
| ||||||||
Money Market Funds–0.59% | ||||||||
Invesco Government & Agency Portfolio, Institutional Class, 0.03%(c)(d) | 6,222,956 | 6,222,956 | ||||||
| ||||||||
Invesco Liquid Assets Portfolio, Institutional Class, 0.01%(c)(d) | 4,441,187 | 4,442,964 | ||||||
| ||||||||
Invesco Treasury Portfolio, Institutional Class, 0.01%(c)(d) | 7,111,950 | 7,111,950 | ||||||
| ||||||||
Total Money Market Funds |
| 17,777,870 | ||||||
| ||||||||
TOTAL INVESTMENTS IN |
| 3,015,274,057 | ||||||
| ||||||||
OTHER ASSETS LESS LIABILITIES–0.06% |
| 1,695,239 | ||||||
| ||||||||
NET ASSETS–100.00% |
| $ | 3,016,969,296 | |||||
|
Investment Abbreviations:
ADR – American Depositary Receipt
REIT – Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
Value October 31, 2020 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation | Realized (Loss) | Value April 30, 2021 | Dividend Income | |||||||||||||||||||||||||||||
Investments in Affiliated Money Market Funds: | |||||||||||||||||||||||||||||||||||
Invesco Government & Agency Portfolio, Institutional Class | $ | 4,904,471 | $ | 86,946,320 | $ | (85,627,835 | ) | $ | - | $ | - | $ | 6,222,956 | $ | 806 | ||||||||||||||||||||
Invesco Liquid Assets Portfolio, Institutional Class | 3,501,382 | 62,104,514 | (61,162,739 | ) | 118 | (311 | ) | 4,442,964 | 871 | ||||||||||||||||||||||||||
Invesco Treasury Portfolio, Institutional Class | 5,605,110 | 99,367,222 | (97,860,382 | ) | - | - | 7,111,950 | 362 | |||||||||||||||||||||||||||
Total | $ | 14,010,963 | $ | 248,418,056 | $ | (244,650,956 | ) | $ | 118 | $ | (311 | ) | $ | 17,777,870 | $ | 2,039 |
(d) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 | Invesco Rising Dividends Fund |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
Information Technology | 27.02 | % | |||
Health Care | 14.91 | ||||
Financials | 13.01 | ||||
Industrials | 11.37 | ||||
Consumer Discretionary | 9.16 | ||||
Consumer Staples | 6.49 | ||||
Communication Services | 6.48 | ||||
Real Estate | 4.34 | ||||
Utilities | 2.66 | ||||
Energy | 2.04 | ||||
Materials | 1.87 | ||||
Money Market Funds Plus Other Assets Less Liabilities | 0.65 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 | Invesco Rising Dividends Fund |
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
Assets: | ||||
Investments in securities, at value | $ | 2,997,496,187 | ||
| ||||
Investments in affiliated money market funds, at value (Cost $17,777,840) | 17,777,870 | |||
| ||||
Cash | 1,535,677 | |||
| ||||
Foreign currencies, at value (Cost $302) | 313 | |||
| ||||
Receivable for: | ||||
| ||||
Fund shares sold | 1,009,945 | |||
| ||||
Dividends | 2,299,265 | |||
| ||||
Investment for trustee deferred compensation and retirement plans | 203,074 | |||
| ||||
Other assets | 102,048 | |||
| ||||
Total assets | 3,020,424,379 | |||
| ||||
Liabilities: | ||||
Payable for: | ||||
Fund shares reacquired | 1,253,291 | |||
| ||||
Accrued fees to affiliates | 1,424,491 | |||
| ||||
Accrued trustees’ and officers’ fees and benefits | 4,322 | |||
| ||||
Accrued other operating expenses | 450,640 | |||
| ||||
Trustee deferred compensation and retirement plans | 322,339 | |||
| ||||
Total liabilities | 3,455,083 | |||
| ||||
Net assets applicable to shares outstanding | $ | 3,016,969,296 | ||
| ||||
Net assets consist of: | ||||
Shares of beneficial interest | $ | 1,608,609,339 | ||
| ||||
Distributable earnings | 1,408,359,957 | |||
| ||||
$ | 3,016,969,296 | |||
|
Net Assets: | ||||
Class A | $ | 2,364,508,553 | ||
| ||||
Class C | $ | 201,125,844 | ||
| ||||
Class R | $ | 108,776,009 | ||
| ||||
Class Y | $ | 307,763,971 | ||
| ||||
Class R5 | $ | 13,394 | ||
| ||||
Class R6 | $ | 34,781,525 | ||
| ||||
Shares outstanding, no par value, with an unlimited number of shares authorized: |
| |||
Class A | 94,605,185 | |||
| ||||
Class C | 9,776,933 | |||
| ||||
Class R | 4,386,334 | |||
| ||||
Class Y | 11,819,254 | |||
| ||||
Class R5 | 536.2 | |||
| ||||
Class R6 | 1,339,306 | |||
| ||||
Class A: | ||||
Net asset value per share | $ | 24.99 | ||
| ||||
Maximum offering price per share | $ | 26.44 | ||
| ||||
Class C: | ||||
Net asset value and offering price per share | $ | 20.57 | ||
| ||||
Class R: | ||||
Net asset value and offering price per share | $ | 24.80 | ||
| ||||
Class Y: | ||||
Net asset value and offering price per share | $ | 26.04 | ||
| ||||
Class R5: | ||||
Net asset value and offering price per share | $ | 24.98 | ||
| ||||
Class R6: | ||||
Net asset value and offering price per share | $ | 25.97 | ||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 | Invesco Rising Dividends Fund |
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
Investment income: | ||||
Dividends (net of foreign withholding taxes of $14,451) | $ | 24,741,566 | ||
| ||||
Dividends from affiliated money market funds | 2,039 | |||
| ||||
Total investment income | 24,743,605 | |||
| ||||
Expenses: | ||||
Advisory fees | 8,293,662 | |||
| ||||
Administrative services fees | 202,989 | |||
| ||||
Custodian fees | 11,174 | |||
| ||||
Distribution fees: | ||||
Class A | 2,732,691 | |||
| ||||
Class C | 1,083,308 | |||
| ||||
Class R | 258,142 | |||
| ||||
Transfer agent fees – A, C, R and Y | 1,829,961 | |||
| ||||
Transfer agent fees – R5 | 2 | |||
| ||||
Transfer agent fees – R6 | 4,291 | |||
| ||||
Trustees’ and officers’ fees and benefits | 17,059 | |||
| ||||
Registration and filing fees | 66,397 | |||
| ||||
Reports to shareholders | 105,624 | |||
| ||||
Professional services fees | 31,096 | |||
| ||||
Other | 43,230 | |||
| ||||
Total expenses | 14,679,626 | |||
| ||||
Less: Fees waived, expenses reimbursed and/or expense offset arrangement(s) | (14,464 | ) | ||
| ||||
Net expenses | 14,665,162 | |||
| ||||
Net investment income | 10,078,443 | |||
| ||||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Unaffiliated investment securities | 218,028,740 | |||
| ||||
Affiliated investment securities | (311 | ) | ||
| ||||
Foreign currencies | 871 | |||
| ||||
218,029,300 | ||||
| ||||
Change in net unrealized appreciation of: | ||||
Unaffiliated investment securities | 380,604,682 | |||
| ||||
Affiliated investment securities | 118 | |||
| ||||
Foreign currencies | 4,534 | |||
| ||||
380,609,334 | ||||
| ||||
Net realized and unrealized gain | 598,638,634 | |||
| ||||
Net increase in net assets resulting from operations | $ | 608,717,077 | ||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 | Invesco Rising Dividends Fund |
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
April 30, 2021 | October 31, 2020 | |||||||
| ||||||||
Operations: | ||||||||
Net investment income | $ | 10,078,443 | $ | 25,071,899 | ||||
| ||||||||
Net realized gain | 218,029,300 | 46,943,177 | ||||||
| ||||||||
Change in net unrealized appreciation | 380,609,334 | 76,117,422 | ||||||
| ||||||||
Net increase in net assets resulting from operations | 608,717,077 | 148,132,498 | ||||||
| ||||||||
Distributions to shareholders from distributable earnings: | ||||||||
Class A | (43,317,399 | ) | (87,813,829 | ) | ||||
| ||||||||
Class C | (5,112,378 | ) | (12,618,892 | ) | ||||
| ||||||||
Class R | (1,987,229 | ) | (4,200,159 | ) | ||||
| ||||||||
Class Y | (5,883,334 | ) | (13,324,671 | ) | ||||
| ||||||||
Class R5 | (269 | ) | (510 | ) | ||||
| ||||||||
Class R6 | (656,047 | ) | (1,342,644 | ) | ||||
| ||||||||
Total distributions from distributable earnings | (56,956,656 | ) | (119,300,705 | ) | ||||
| ||||||||
Share transactions–net: | ||||||||
Class A | (6,050,524 | ) | (134,587,407 | ) | ||||
| ||||||||
Class C | (80,595,814 | ) | (79,785,517 | ) | ||||
| ||||||||
Class R | (6,071,210 | ) | (10,811,085 | ) | ||||
| ||||||||
Class Y | (3,414,065 | ) | (59,570,795 | ) | ||||
| ||||||||
Class R6 | (15,220 | ) | (1,510,672 | ) | ||||
| ||||||||
Net increase (decrease) in net assets resulting from share transactions | (96,146,833 | ) | (286,265,476 | ) | ||||
| ||||||||
Net increase (decrease) in net assets | 455,613,588 | (257,433,683 | ) | |||||
| ||||||||
Net assets: | ||||||||
Beginning of period | 2,561,355,708 | 2,818,789,391 | ||||||
| ||||||||
End of period | $ | 3,016,969,296 | $ | 2,561,355,708 | ||||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 | Invesco Rising Dividends Fund |
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return (b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed(c) | Ratio of net investment income to average net assets | Portfolio turnover (d) | |||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | $ | 20.52 | $ | 0.09 | $ | 4.85 | $ | 4.94 | $ | (0.09 | ) | $ | (0.38 | ) | $ | (0.47 | ) | $ | 24.99 | 24.30 | % | $ | 2,364,509 | 1.00 | %(e) | 1.00 | %(e) | 0.75 | %(e) | 19 | % | |||||||||||||||||||||||||
Year ended 10/31/20 | 20.21 | 0.20 | 0.99 | 1.19 | (0.23 | ) | (0.65 | ) | (0.88 | ) | 20.52 | 6.05 | 1,944,346 | 1.04 | 1.04 | 0.99 | 28 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 19.48 | 0.22 | 1.98 | 2.20 | (0.18 | ) | (1.29 | ) | (1.47 | ) | 20.21 | 12.30 | 2,055,643 | 1.05 | 1.05 | 1.13 | 29 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.45 | 0.22 | 0.63 | 0.85 | (0.23 | ) | (1.59 | ) | (1.82 | ) | 19.48 | 4.39 | 1,980,262 | 1.06 | 1.06 | 1.11 | 58 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.26 | 0.27 | 3.11 | 3.38 | (0.29 | ) | (0.90 | ) | (1.19 | ) | 20.45 | 19.42 | 2,131,479 | 1.07 | 1.07 | 1.43 | 78 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 19.88 | 0.24 | (0.48 | ) | (0.24 | ) | (0.25 | ) | (1.13 | ) | (1.38 | ) | 18.26 | (1.37 | ) | 2,201,657 | 1.07 | 1.07 | 1.29 | 96 | ||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 16.95 | 0.00 | (f) | 4.00 | 4.00 | (0.00 | )(f) | (0.38 | ) | (0.38 | ) | 20.57 | 23.85 | 201,126 | 1.75 | (e) | 1.75 | (e) | 0.00 | (e) | 19 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 16.77 | 0.04 | 0.82 | 0.86 | (0.03 | ) | (0.65 | ) | (0.68 | ) | 16.95 | 5.23 | 238,458 | 1.79 | 1.79 | 0.24 | 28 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 16.44 | 0.06 | 1.64 | 1.70 | (0.08 | ) | (1.29 | ) | (1.37 | ) | 16.77 | 11.44 | 317,475 | 1.80 | 1.80 | 0.38 | 29 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 17.54 | 0.06 | 0.54 | 0.60 | (0.11 | ) | (1.59 | ) | (1.70 | ) | 16.44 | 3.65 | 470,544 | 1.81 | 1.81 | 0.36 | 58 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 15.83 | 0.11 | 2.68 | 2.79 | (0.18 | ) | (0.90 | ) | (1.08 | ) | 17.54 | 18.54 | 534,216 | 1.83 | 1.83 | 0.68 | 78 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 17.43 | 0.09 | (0.42 | ) | (0.33 | ) | (0.14 | ) | (1.13 | ) | (1.27 | ) | 15.83 | (2.13 | ) | 586,282 | 1.82 | 1.82 | 0.54 | 96 | ||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 20.36 | 0.06 | 4.82 | 4.88 | (0.06 | ) | (0.38 | ) | (0.44 | ) | 24.80 | 24.19 | 108,776 | 1.25 | (e) | 1.25 | (e) | 0.50 | (e) | 19 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 20.06 | 0.15 | 0.97 | 1.12 | (0.17 | ) | (0.65 | ) | (0.82 | ) | 20.36 | 5.75 | 94,605 | 1.29 | 1.29 | 0.74 | 28 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 19.35 | 0.17 | 1.97 | 2.14 | (0.14 | ) | (1.29 | ) | (1.43 | ) | 20.06 | 12.00 | 104,287 | 1.30 | 1.30 | 0.88 | 29 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.32 | 0.17 | 0.63 | 0.80 | (0.18 | ) | (1.59 | ) | (1.77 | ) | 19.35 | 4.16 | 104,523 | 1.31 | 1.31 | 0.86 | 58 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.15 | 0.23 | 3.08 | 3.31 | (0.24 | ) | (0.90 | ) | (1.14 | ) | 20.32 | 19.12 | 111,030 | 1.33 | 1.33 | 1.20 | 78 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 19.77 | 0.19 | (0.48 | ) | (0.29 | ) | (0.20 | ) | (1.13 | ) | (1.33 | ) | 18.15 | (1.63 | ) | 118,374 | 1.32 | 1.32 | 1.04 | 96 | ||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 21.36 | 0.12 | 5.06 | 5.18 | (0.12 | ) | (0.38 | ) | (0.50 | ) | 26.04 | 24.50 | 307,764 | 0.75 | (e) | 0.75 | (e) | 1.00 | (e) | 19 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 21.02 | 0.26 | 1.02 | 1.28 | (0.29 | ) | (0.65 | ) | (0.94 | ) | 21.36 | 6.29 | 255,399 | 0.79 | 0.79 | 1.24 | 28 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 20.21 | 0.27 | 2.06 | 2.33 | (0.23 | ) | (1.29 | ) | (1.52 | ) | 21.02 | 12.52 | 311,750 | 0.80 | 0.80 | 1.38 | 29 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 21.14 | 0.28 | 0.66 | 0.94 | (0.28 | ) | (1.59 | ) | (1.87 | ) | 20.21 | 4.68 | 345,108 | 0.81 | 0.81 | 1.36 | 58 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.84 | 0.34 | 3.20 | 3.54 | (0.34 | ) | (0.90 | ) | (1.24 | ) | 21.14 | 19.69 | 462,807 | 0.83 | 0.83 | 1.69 | 78 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.45 | 0.32 | (0.52 | ) | (0.20 | ) | (0.28 | ) | (1.13 | ) | (1.41 | ) | 18.84 | (1.11 | ) | 485,497 | 0.82 | 0.82 | 1.67 | 96 | ||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 20.51 | 0.13 | 4.85 | 4.98 | (0.13 | ) | (0.38 | ) | (0.51 | ) | 24.98 | 24.53 | 13 | 0.65 | (e) | 0.65 | (e) | 1.10 | (e) | 19 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 20.21 | 0.27 | 0.98 | 1.25 | (0.30 | ) | (0.65 | ) | (0.95 | ) | 20.51 | 6.41 | 11 | 0.67 | 0.67 | 1.36 | 28 | |||||||||||||||||||||||||||||||||||||||
Period ended 10/31/19(g) | 18.65 | 0.13 | 1.55 | 1.68 | (0.12 | ) | — | (0.12 | ) | 20.21 | 9.05 | 11 | 0.70 | (h) | 0.70 | (h) | 1.49 | (h) | 29 | |||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 21.31 | 0.13 | 5.04 | 5.17 | (0.13 | ) | (0.38 | ) | (0.51 | ) | 25.97 | 24.53 | 34,782 | 0.64 | (e) | 0.65 | (e) | 1.11 | (e) | 19 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 20.97 | 0.29 | 1.02 | 1.31 | (0.32 | ) | (0.65 | ) | (0.97 | ) | 21.31 | 6.47 | 28,537 | 0.64 | 0.67 | 1.39 | 28 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 20.16 | 0.30 | 2.06 | 2.36 | (0.26 | ) | (1.29 | ) | (1.55 | ) | 20.97 | 12.72 | 29,624 | 0.64 | 0.64 | 1.54 | 29 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 21.10 | 0.31 | 0.65 | 0.96 | (0.31 | ) | (1.59 | ) | (1.90 | ) | 20.16 | 4.82 | 24,128 | 0.65 | 0.65 | 1.52 | 58 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.81 | 0.35 | 3.21 | 3.56 | (0.37 | ) | (0.90 | ) | (1.27 | ) | 21.10 | 19.89 | 21,409 | 0.64 | 0.64 | 1.78 | 78 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.43 | 0.37 | (0.53 | ) | (0.16 | ) | (0.33 | ) | (1.13 | ) | (1.46 | ) | 18.81 | (0.92 | ) | 8,978 | 0.63 | 0.63 | 1.95 | 96 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Does not include indirect expenses from affiliated fund fees and expenses of 0.00% for the years ended October 31, 2019, 2018, 2017, and 2016, respectively. |
(d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $2,204,270, $218,457, $104,113, $286,722, $12 and $31,807 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(f) | Amount represents less than $(0.005) per share. |
(g) | Commencement date after the close of business on May 24, 2019. |
(h) | Annualized. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 | Invesco Rising Dividends Fund |
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Rising Dividends Fund (the “Fund”) is a series portfolio of AIM Equity Funds (Invesco Equity Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek total return.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
12 | Invesco Rising Dividends Fund |
settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions – Distributions from net investment income, if any, are declared and paid quarterly and are recorded on the ex-dividend date. Distributions from net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
J. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized
13 | Invesco Rising Dividends Fund |
gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
K. | COVID-19 Risk – The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets* | Rate | |||
| ||||
Up to $800 million | 0.650% | |||
| ||||
Next $700 million | 0.600% | |||
| ||||
Next $1.0 billion | 0.580% | |||
| ||||
Next $2.5 billion | 0.560% | |||
| ||||
Next $5 billion | 0.540% | |||
| ||||
Over $10 billion | 0.520% | |||
|
* | The advisory fee paid by the Fund shall be reduced by any amounts paid by the Fund under the administrative services agreement with the Adviser. |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.59% .
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s). Invesco has also entered into a sub-advisory agreement with OppenheimerFunds, Inc. to provide discretionary management services to the Fund.
The Adviser has contractually agreed, through May 31, 2021, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.08%, 1.83%, 1.33%, 0.83%, 0.69%, and 0.64%, respectively, of the Fund’s average daily net assets (the “expense limits”). Effective June 1, 2021 through at least June 30, 2022, the Adviser has contractually agreed to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.00%, 2.75%, 2.25%, 1.75%, 1.75% and 1.75%, respectively, of the Fund’s average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $7,225 and reimbursed class level expenses of $1,387 of Class R6 shares.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Class A Plan, reimburses IDI for its allocated share of expenses incurred for the period, up to a maximum annual rate of 0.25% of the average daily net assets of Class A shares. The Fund pursuant to the Class C and Class R Plan, pays IDI compensation at the annual rate of 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $128,581 in front-end sales commissions from the sale of Class A shares and $1,050 and $4,283 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $10,332 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
14 | Invesco Rising Dividends Fund |
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 – | Prices are determined using quoted prices in an active market for identical assets. | |
Level 2 – | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. | |
Level 3 – | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| ||||||||||||||||
Investments in Securities | ||||||||||||||||
| ||||||||||||||||
Common Stocks & Other Equity Interests | $ | 2,921,811,472 | $ | 75,684,715 | $– | $ | 2,997,496,187 | |||||||||
| ||||||||||||||||
Money Market Funds | 17,777,870 | – | – | 17,777,870 | ||||||||||||
| ||||||||||||||||
Total Investments | $ | 2,939,589,342 | $ | 75,684,715 | $– | $ | 3,015,274,057 | |||||||||
|
NOTE 4–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $5,852.
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP.
Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
NOTE 8–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $516,761,361 and $649,649,889, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
| ||||
Aggregate unrealized appreciation of investments | $ | 1,208,619,608 | ||
| ||||
Aggregate unrealized (depreciation) of investments | (18,764,549 | ) | ||
| ||||
Net unrealized appreciation of investments | $ | 1,189,855,059 | ||
|
15 | Invesco Rising Dividends Fund |
Cost of investments for tax purposes is $1,825,418,998.
NOTE 9–Share Information
Summary of Share Activity | ||||||||||||||||
| ||||||||||||||||
Six months ended | Year ended | |||||||||||||||
April 30, 2021(a) | October 31, 2020 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
| ||||||||||||||||
Sold: | ||||||||||||||||
Class A | 3,034,839 | $ | 69,996,892 | 5,894,863 | $ | 116,781,610 | ||||||||||
| ||||||||||||||||
Class C | 653,976 | 12,483,671 | 1,602,278 | 26,084,159 | ||||||||||||
| ||||||||||||||||
Class R | 312,066 | 7,162,411 | 584,878 | 11,437,944 | ||||||||||||
| ||||||||||||||||
Class Y | 824,080 | 19,743,925 | 1,352,676 | 27,716,914 | ||||||||||||
| ||||||||||||||||
Class R6 | 182,785 | 4,366,557 | 263,852 | 5,408,064 | ||||||||||||
| ||||||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 1,818,140 | 40,636,672 | 4,151,651 | 82,608,000 | ||||||||||||
| ||||||||||||||||
Class C | 268,034 | 4,913,101 | 714,637 | 11,902,684 | ||||||||||||
| ||||||||||||||||
Class R | 89,393 | 1,979,905 | 210,925 | 4,180,587 | ||||||||||||
| ||||||||||||||||
Class Y | 211,138 | 4,917,657 | 555,854 | 11,497,026 | ||||||||||||
| ||||||||||||||||
Class R6 | 26,493 | 615,641 | 62,079 | 1,273,531 | ||||||||||||
| ||||||||||||||||
Automatic conversion of Class C shares to Class A shares: | ||||||||||||||||
Class A | 3,138,995 | 71,429,206 | 2,434,973 | 48,850,413 | ||||||||||||
| ||||||||||||||||
Class C | (3,811,580 | ) | (71,429,206 | ) | (2,947,463 | ) | (48,850,413 | ) | ||||||||
| ||||||||||||||||
Reacquired: | ||||||||||||||||
Class A | (8,146,338 | ) | (188,113,294 | ) | (19,426,928 | ) | (382,827,430 | ) | ||||||||
| ||||||||||||||||
Class C | (1,403,207 | ) | (26,563,380 | ) | (4,234,971 | ) | (68,921,947 | ) | ||||||||
| ||||||||||||||||
Class R | (661,364 | ) | (15,213,526 | ) | (1,348,664 | ) | (26,429,616 | ) | ||||||||
| ||||||||||||||||
Class Y | (1,171,182 | ) | (28,075,647 | ) | (4,782,616 | ) | (98,784,735 | ) | ||||||||
| ||||||||||||||||
Class R6 | (209,293 | ) | (4,997,418 | ) | (399,193 | ) | (8,192,267 | ) | ||||||||
| ||||||||||||||||
Net increase (decrease) in share activity | (4,843,025 | ) | $ | (96,146,833 | ) | (15,311,169 | ) | $ | (286,265,476 | ) | ||||||
|
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 26% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
16 | Invesco Rising Dividends Fund |
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
ACTUAL | HYPOTHETICAL (5% annual return before expenses) | |||||||||||
Beginning Account Value (11/01/20) | Ending Account Value (04/30/21)1 | Expenses Paid During Period2 | Ending Account Value (04/30/21) | Expenses Paid During Period2 | Annualized Expense Ratio | |||||||
Class A | $1,000.00 | $1,243.00 | $5.56 | $1,019.84 | $5.01 | 1.00% | ||||||
Class C | 1,000.00 | 1,238.50 | 9.71 | 1,016.12 | 8.75 | 1.75 | ||||||
Class R | 1,000.00 | 1,241.90 | 6.95 | 1,018.60 | 6.26 | 1.25 | ||||||
Class Y | 1,000.00 | 1,245.00 | 4.17 | 1,021.08 | 3.76 | 0.75 | ||||||
Class R5 | 1,000.00 | 1,245.30 | 3.62 | 1,021.57 | 3.26 | 0.65 | ||||||
Class R6 | 1,000.00 | 1,245.30 | 3.56 | 1,021.62 | 3.21 | 0.64 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
17 | Invesco Rising Dividends Fund |
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ | Fund reports and prospectuses |
∎ | Quarterly statements |
∎ | Daily confirmations |
∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-01424 and 002-25469 Invesco Distributors, Inc. O-RISD-SAR-1
|
| |||
Semiannual Report to Shareholders |
April 30, 2021 | |||
| ||||
Invesco Summit Fund | ||||
Nasdaq: | ||||
A: ASMMX ∎ C: CSMMX ∎ P: SMMIX ∎ S: SMMSX ∎ Y: ASMYX ∎ R5: SMITX ∎ R6: SMISX | ||||
2 | Fund Performance | |||||
4 | Liquidity Risk Management Program | |||||
5 | Schedule of Investments | |||||
8 | Financial Statements | |||||
11 | Financial Highlights | |||||
12 | Notes to Financial Statements | |||||
17 | Fund Expenses | |||||
18 | Proxy Results |
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
Fund Performance
| ||||
Fund vs. Indexes |
| |||
Cumulative total returns, 10/31/20 to 4/30/21, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 27.92 | % | ||
Class C Shares | 27.44 | |||
Class P Shares | 28.02 | |||
Class S Shares | 27.97 | |||
Class Y Shares | 28.05 | |||
Class R5 Shares | 28.02 | |||
Class R6 Shares | 28.09 | |||
S&P 500 Index▼ (Broad Market Index) | 28.85 | |||
Russell 1000 Growth Index▼ (Style-Specific Index) | 24.31 | |||
Lipper Multi-Cap Growth Funds Index∎ (Peer Group Index) | 26.41 | |||
Source(s): ▼RIMES Technologies Corp.; ∎Lipper Inc. |
| |||
The S&P 500® Index is an unmanaged index considered representative of the US stock market. |
| |||
The Russell 1000® Growth Index is an unmanaged index considered representative of large-cap growth stocks. The Russell 1000 Growth Index is a trademark/service mark of the Frank Russell Co. Russell® is a trademark of the Frank Russell Co. |
| |||
The Lipper Multi-Cap Growth Funds Index is an unmanaged index considered representative of multi-cap growth funds tracked by Lipper. |
| |||
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). |
| |||
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
|
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 | Invesco Summit Fund |
Average Annual Total Returns |
| |||
As of 4/30/21, including maximum applicable sales charges |
| |||
Class A Shares | ||||
Inception (10/31/05) | 11.32 | % | ||
10 Years | 15.55 | |||
5 Years | 22.54 | |||
1 Year | 50.17 | |||
Class C Shares | ||||
Inception (10/31/05) | 11.29 | % | ||
10 Years | 15.50 | |||
5 Years | 22.99 | |||
1 Year | 56.63 | |||
Class P Shares | ||||
Inception (11/1/82) | 10.80 | % | ||
10 Years | 16.37 | |||
5 Years | 24.12 | |||
1 Year | 59.14 | |||
Class S Shares | ||||
Inception (9/25/09) | 16.74 | % | ||
10 Years | 16.32 | |||
5 Years | 24.06 | |||
1 Year | 59.04 | |||
Class Y Shares | ||||
Inception (10/3/08) | 15.02 | % | ||
10 Years | 16.49 | |||
5 Years | 24.23 | |||
1 Year | 59.22 | |||
Class R5 Shares | ||||
Inception (10/3/08) | 15.12 | % | ||
10 Years | 16.56 | |||
5 Years | 24.25 | |||
1 Year | 59.19 | |||
Class R6 Shares | ||||
10 Years | 16.34 | % | ||
5 Years | 24.23 | |||
1 Year | 59.37 |
Class R6 shares incepted on April 4, 2017. Performance shown prior to that date is that of Class A shares at net asset value and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee future results; current performance may be lower or higher. Please visit invesco.com/ performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class P, Class S, Class Y,
Class R5 and Class R6 shares do not have a front-end sales charge or contingent deferred sales charge (CDSC); therefore, returns shown are at net asset value.
The performance numbers shown do not reflect the creation and sales charges and other fees assessed by the AIM Summit Investors Plans, which were dissolved effective December 8, 2006.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
3 | Invesco Summit Fund |
Liquidity Risk Management Program
In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the “Liquidity Rule”), the Fund has adopted and implemented a liquidity risk management program in accordance with the Liquidity Rule (the “Program”). The Program is reasonably designed to assess and manage the Fund’s liquidity risk, which is the risk that the Fund could not meet redemption requests without significant dilution of remaining investors’ interests in the Fund. The Board of Trustees of the Fund (the “Board”) has appointed Invesco Advisers, Inc. (“Invesco”), the Fund’s investment adviser, as the Program’s administrator, and Invesco has delegated oversight of the Program to the Liquidity Risk Management Committee (the “Committee”), which is composed of senior representatives from relevant business groups at Invesco.
As required by the Liquidity Rule, the Program includes policies and procedures providing for an assessment, no less frequently than annually, of the Fund’s liquidity risk that takes into account, as relevant to the Fund’s liquidity risk: (1) the Fund’s investment strategy and liquidity of portfolio investments during both normal and reasonably foreseeable stressed conditions; (2) short-term and long-term cash flow projections for the Fund during both normal and reasonably foreseeable stressed conditions; and (3) the Fund’s holdings of cash and cash equivalents and any borrowing arrangements. The Liquidity Rule also requires the classification of the Fund’s investments into categories that reflect the assessment of their relative liquidity under current market conditions. The Fund classifies its investments into one of four categories defined in the Liquidity Rule: “Highly Liquid,” “Moderately Liquid,” “Less Liquid,” and “Illiquid.” Funds that are not invested primarily in “Highly Liquid Investments” that are assets (cash or investments that are reasonably expected to be convertible into cash within three business days without significantly changing the market value of the investment) are required to establish a “Highly Liquid Investment Minimum” (“HLIM”), which is the minimum percentage of net assets that must be invested in Highly Liquid Investments. Funds with HLIMs have procedures for addressing HLIM shortfalls, including reporting to the Board and the SEC (on a non-public basis) as required by the Program and the Liquidity Rule. In addition, the Fund may not acquire an investment if, immediately after the acquisition, over 15% of the Fund’s net assets would consist of “Illiquid Investments” that are assets (an investment that cannot reasonably be expected to be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment). The Liquidity Rule and the Program also require reporting to the Board and the SEC (on a non-public basis) if a Fund’s holdings of Illiquid Investments exceed 15% of the Fund’s assets.
At a meeting held on March 22-24, 2021, the Committee presented a report to the Board that addressed the operation of the Program and assessed the Program’s adequacy and effectiveness of implementation (the “Report”). The Report covered the period from January 1, 2020 through December 31, 2020 (the “Program Reporting Period”). The Report discussed notable events affecting liquidity over the Program Reporting Period, including the impact of the coronavirus pandemic on the Fund and the overall market. The Report noted that there were no material changes to the Program during the Program Reporting Period.
The Report stated, in relevant part, that during the Program Reporting Period:
∎ | The Program, as adopted and implemented, remained reasonably designed to assess and manage the Fund’s liquidity risk and was operated effectively to achieve that goal; |
∎ | The Fund’s investment strategy remained appropriate for an open-end fund; |
∎ | The Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund; |
∎ | The Fund did not breach the 15% limit on Illiquid Investments; and |
∎ | The Fund primarily held Highly Liquid Investments and therefore has not adopted an HLIM. |
4 | Invesco Summit Fund |
April 30, 2021
(Unaudited)
Shares | Value | |||||||
| ||||||||
Common Stocks & Other Equity Interests–99.95% |
| |||||||
Aerospace & Defense–0.79% |
| |||||||
Teledyne Technologies, Inc.(b) | 67,500 | $ | 30,223,125 | |||||
| ||||||||
Apparel Retail–0.20% |
| |||||||
MYT Netherlands Parent B.V., ADR (Germany)(b) | 253,929 | 7,610,252 | ||||||
| ||||||||
Application Software–4.89% |
| |||||||
DocuSign, Inc.(b) | 166,500 | 37,119,510 | ||||||
| ||||||||
Paylocity Holding Corp.(b) | 126,900 | 24,522,156 | ||||||
| ||||||||
RingCentral, Inc., Class A(b) | 209,250 | 66,740,288 | ||||||
| ||||||||
Trade Desk, Inc. (The), Class A(b) | 72,540 | 52,904,147 | ||||||
| ||||||||
Unity Software, Inc.(b)(c) | 67,500 | 6,856,650 | ||||||
| ||||||||
188,142,751 | ||||||||
| ||||||||
Asset Management & Custody Banks–2.22% |
| |||||||
Apollo Global Management, Inc. | 328,500 | 18,189,045 | ||||||
| ||||||||
Focus Financial Partners, Inc., Class A(b) | 167,400 | 7,877,844 | ||||||
| ||||||||
KKR & Co., Inc., Class A | 1,048,500 | 59,324,130 | ||||||
| ||||||||
85,391,019 | ||||||||
| ||||||||
Auto Parts & Equipment–0.18% |
| |||||||
Aptiv PLC(b) | 48,600 | 6,993,054 | ||||||
| ||||||||
Automotive Retail–0.40% |
| |||||||
Vroom, Inc.(b)(c) | 330,300 | 15,282,981 | ||||||
| ||||||||
Biotechnology–2.21% |
| |||||||
Alnylam Pharmaceuticals, Inc.(b) | 110,610 | 15,556,190 | ||||||
| ||||||||
Argenx SE, ADR (Netherlands)(b) | 45,900 | 13,159,989 | ||||||
| ||||||||
BeiGene Ltd., ADR (China)(b) | 62,550 | 21,488,427 | ||||||
| ||||||||
C4 Therapeutics, Inc.(b) | 104,400 | 3,455,640 | ||||||
| ||||||||
Innovent Biologics, Inc. (China)(b)(d) | 1,314,000 | 14,215,179 | ||||||
| ||||||||
Kura Oncology, Inc.(b) | 311,400 | 8,386,002 | ||||||
| ||||||||
uniQure N.V. (Netherlands)(b) | 270,900 | 8,741,943 | ||||||
| ||||||||
85,003,370 | ||||||||
| ||||||||
Broadcasting–0.21% |
| |||||||
Discovery, Inc., Class A(b)(c) | 216,000 | 8,134,560 | ||||||
| ||||||||
Consumer Electronics–1.49% |
| |||||||
Sony Group Corp. (Japan) | 570,600 | 57,108,170 | ||||||
| ||||||||
Copper–1.44% |
| |||||||
Freeport-McMoRan, Inc. | 1,464,300 | 55,218,753 | ||||||
| ||||||||
Data Processing & Outsourced Services–7.69% |
| |||||||
Mastercard, Inc., Class A | 352,800 | 134,790,768 | ||||||
| ||||||||
PayPal Holdings, Inc.(b) | 404,100 | 105,991,389 | ||||||
| ||||||||
StoneCo Ltd., Class A (Brazil)(b) | 691,200 | 44,679,168 | ||||||
| ||||||||
WEX, Inc.(b) | 50,220 | 10,305,646 | ||||||
| ||||||||
295,766,971 | ||||||||
| ||||||||
Diversified Banks–0.19% |
| |||||||
BDO Unibank, Inc. (Philippines) | 3,420,000 | 7,322,273 | ||||||
| ||||||||
Diversified Support Services–0.29% |
| |||||||
Cintas Corp. | 31,860 | 10,996,160 | ||||||
|
Shares | Value | |||||||
| ||||||||
Education Services–0.09% | ||||||||
Coursera, Inc.(b) | 76,500 | $ | 3,419,550 | |||||
| ||||||||
Environmental & Facilities Services–0.59% |
| |||||||
Clean Harbors, Inc.(b) | 126,900 | 11,289,024 | ||||||
| ||||||||
GFL Environmental, Inc. (Canada) | 343,800 | 11,321,334 | ||||||
| ||||||||
22,610,358 | ||||||||
| ||||||||
Financial Exchanges & Data–0.13% |
| |||||||
MarketAxess Holdings, Inc. | 10,530 | 5,143,484 | ||||||
| ||||||||
Food Distributors–1.15% |
| |||||||
Performance Food Group Co.(b) | 753,300 | 44,218,710 | ||||||
| ||||||||
Health Care Equipment–2.86% |
| |||||||
Danaher Corp. | 15,930 | 4,045,264 | ||||||
| ||||||||
DexCom, Inc.(b) | 40,950 | 15,810,795 | ||||||
| ||||||||
Intuitive Surgical, Inc.(b) | 30,150 | 26,079,750 | ||||||
| ||||||||
Teleflex, Inc. | 70,740 | 29,886,235 | ||||||
| ||||||||
Zimmer Biomet Holdings, Inc. | 193,500 | 34,280,460 | ||||||
| ||||||||
110,102,504 | ||||||||
| ||||||||
Health Care Services–0.28% |
| |||||||
LHC Group, Inc.(b) | 50,940 | 10,609,274 | ||||||
| ||||||||
Health Care Supplies–1.62% |
| |||||||
Align Technology, Inc.(b) | 43,020 | 25,619,701 | ||||||
| ||||||||
Cooper Cos., Inc. (The) | 61,650 | 25,331,368 | ||||||
| ||||||||
West Pharmaceutical Services, Inc. | 34,650 | 11,383,218 | ||||||
| ||||||||
62,334,287 | ||||||||
| ||||||||
Health Care Technology–0.21% |
| |||||||
GoodRx Holdings, Inc., Class A(b)(c) | 204,210 | 8,170,442 | ||||||
| ||||||||
Home Improvement Retail–1.90% |
| |||||||
Lowe’s Cos., Inc. | 372,240 | 73,052,100 | ||||||
| ||||||||
Hotels, Resorts & Cruise Lines–3.13% |
| |||||||
Booking Holdings, Inc.(b) | 17,640 | 43,501,651 | ||||||
| ||||||||
Marriott Vacations Worldwide Corp. | 211,500 | 37,568,745 | ||||||
| ||||||||
Travel + Leisure Co. | 605,700 | 39,085,821 | ||||||
| ||||||||
120,156,217 | ||||||||
| ||||||||
Industrial Conglomerates–0.28% |
| |||||||
Roper Technologies, Inc. | 24,300 | 10,848,492 | ||||||
| ||||||||
Industrial Machinery–0.50% |
| |||||||
Chart Industries, Inc.(b)(c) | 118,800 | 19,082,844 | ||||||
| ||||||||
Interactive Home Entertainment–7.51% |
| |||||||
Activision Blizzard, Inc. | 683,100 | 62,291,889 | ||||||
| ||||||||
Electronic Arts, Inc. | 253,530 | 36,021,542 | ||||||
| ||||||||
Nintendo Co. Ltd. (Japan) | 110,700 | 63,422,086 | ||||||
| ||||||||
Sea Ltd., ADR (Taiwan)(b) | 369,900 | 93,414,546 | ||||||
| ||||||||
Take-Two Interactive Software, Inc.(b) | 192,060 | 33,683,483 | ||||||
| ||||||||
288,833,546 | ||||||||
| ||||||||
Interactive Media & Services–9.77% |
| |||||||
Alphabet, Inc., Class A(b) | 414 | 974,349 | ||||||
| ||||||||
Alphabet, Inc., Class C(b) | 54,891 | 132,293,897 | ||||||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 | Invesco Summit Fund |
Shares | Value | |||||||
| ||||||||
Interactive Media & Services–(continued) |
| |||||||
Bumble, Inc., Class A(b)(c) | 139,820 | $ | 8,422,757 | |||||
| ||||||||
Facebook, Inc., Class A(b) | 557,280 | 181,160,582 | ||||||
| ||||||||
Kuaishou Technology (China)(b)(d) | 536,400 | 17,253,328 | ||||||
| ||||||||
Pinterest, Inc., Class A(b) | 241,200 | 16,008,444 | ||||||
| ||||||||
ZoomInfo Technologies, Inc., Class A(b) | 373,500 | 19,369,710 | ||||||
| ||||||||
375,483,067 | ||||||||
| ||||||||
Internet & Direct Marketing Retail–14.08% |
| |||||||
Alibaba Group Holding Ltd., ADR (China)(b) | 260,361 | 60,130,373 | ||||||
| ||||||||
Amazon.com, Inc.(b) | 101,880 | 353,260,750 | ||||||
| ||||||||
Farfetch Ltd., Class A (United Kingdom)(b) | 324,900 | 15,916,851 | ||||||
| ||||||||
HelloFresh SE (Germany)(b) | 674,100 | 55,918,664 | ||||||
| ||||||||
JD.com, Inc., ADR (China)(b) | 384,300 | 29,729,448 | ||||||
| ||||||||
MercadoLibre, Inc. (Argentina)(b) | 9,630 | 15,128,537 | ||||||
| ||||||||
Overstock.com, Inc.(b) | 138,600 | 11,295,900 | ||||||
| ||||||||
541,380,523 | ||||||||
| ||||||||
Internet Services & Infrastructure–1.03% |
| |||||||
MongoDB, Inc.(b) | 12,600 | 3,747,996 | ||||||
| ||||||||
Twilio, Inc., Class A(b) | 97,740 | 35,948,772 | ||||||
| ||||||||
39,696,768 | ||||||||
| ||||||||
Life Sciences Tools & Services–2.36% |
| |||||||
10X Genomics, Inc., Class A(b) | 201,600 | 39,876,480 | ||||||
| ||||||||
Avantor, Inc.(b) | 1,581,300 | 50,664,852 | ||||||
| ||||||||
90,541,332 | ||||||||
| ||||||||
Managed Health Care–0.34% |
| |||||||
UnitedHealth Group, Inc. | 33,210 | 13,244,148 | ||||||
| ||||||||
Movies & Entertainment–0.98% |
| |||||||
IMAX Corp.(b) | 436,500 | 9,000,630 | ||||||
| ||||||||
Netflix, Inc.(b) | 48,690 | 25,000,855 | ||||||
| ||||||||
Walt Disney Co. (The)(b) | 20,160 | 3,750,163 | ||||||
| ||||||||
37,751,648 | ||||||||
| ||||||||
Oil & Gas Exploration & Production–2.19% |
| |||||||
APA Corp. | 2,574,900 | 51,498,000 | ||||||
| ||||||||
Denbury, Inc.(b) | 598,500 | 32,564,385 | ||||||
| ||||||||
84,062,385 | ||||||||
| ||||||||
Oil & Gas Refining & Marketing–0.18% |
| |||||||
Renewable Energy Group, Inc.(b) | 126,000 | 6,995,520 | ||||||
| ||||||||
Packaged Foods & Meats–0.97% |
| |||||||
Nomad Foods Ltd. (United | 180,900 | 5,275,044 | ||||||
| ||||||||
Tyson Foods, Inc., Class A | 414,900 | 32,134,005 | ||||||
| ||||||||
37,409,049 | ||||||||
| ||||||||
Pharmaceuticals–0.82% |
| |||||||
Reata Pharmaceuticals, Inc., | 312,300 | 31,667,220 | ||||||
| ||||||||
Railroads–0.45% |
| |||||||
Kansas City Southern | 59,130 | 17,278,377 | ||||||
| ||||||||
Regional Banks–0.22% |
| |||||||
SVB Financial Group(b) | 15,030 | 8,594,605 | ||||||
| ||||||||
Research & Consulting Services–0.79% |
| |||||||
CoStar Group, Inc.(b) | 35,370 | 30,221,189 | ||||||
| ||||||||
Semiconductor Equipment–3.21% |
| |||||||
Applied Materials, Inc. | 730,800 | 96,984,468 | ||||||
|
Shares | Value | |||||||
| ||||||||
Semiconductor Equipment–(continued) |
| |||||||
ASML Holding N.V., New York Shares | ||||||||
| ||||||||
(Netherlands)(c) | 40,860 | $ | 26,481,366 | |||||
| ||||||||
123,465,834 | ||||||||
| ||||||||
Semiconductors–4.58% |
| |||||||
NVIDIA Corp. | 118,530 | 71,163,042 | ||||||
| ||||||||
QUALCOMM, Inc. | 496,980 | 68,980,824 | ||||||
| ||||||||
Semtech Corp.(b) | 531,900 | 36,030,906 | ||||||
| ||||||||
176,174,772 | ||||||||
| ||||||||
Specialized REITs–1.40% |
| |||||||
EPR Properties | 1,124,100 | 53,630,811 | ||||||
| ||||||||
Specialty Chemicals–0.39% |
| |||||||
Danimer Scientific, Inc.(b)(c) | 589,500 | 15,061,725 | ||||||
| ||||||||
Systems Software–7.72% |
| |||||||
KnowBe4, Inc., Class A(b) | 606,664 | 13,941,139 | ||||||
| ||||||||
Microsoft Corp. | 638,280 | 160,961,451 | ||||||
| ||||||||
Palo Alto Networks, Inc.(b) | 195,300 | 69,017,067 | ||||||
| ||||||||
ServiceNow, Inc.(b) | 104,490 | 52,910,601 | ||||||
| ||||||||
296,830,258 | ||||||||
| ||||||||
Technology Hardware, Storage & Peripherals–2.45% |
| |||||||
Apple, Inc. | 716,450 | 94,184,517 | ||||||
| ||||||||
Trading Companies & Distributors–1.15% |
| |||||||
Fastenal Co. | 297,000 | 15,527,160 | ||||||
| ||||||||
United Rentals, Inc.(b) | 89,460 | 28,622,727 | ||||||
| ||||||||
44,149,887 | ||||||||
| ||||||||
Trucking–2.42% |
| |||||||
Lyft, Inc., Class A(b) | 507,600 | 28,253,016 | ||||||
| ||||||||
Ryder System, Inc. | 405,000 | 32,335,200 | ||||||
| ||||||||
TuSimple Holdings, Inc., | 495,000 | 19,022,850 | ||||||
| ||||||||
Uber Technologies, Inc.(b) | 248,400 | 13,604,868 | ||||||
| ||||||||
93,215,934 | ||||||||
| ||||||||
Total Common Stocks & Other Equity Interests |
| 3,842,814,816 | ||||||
| ||||||||
Money Market Funds–0.04% |
| |||||||
Invesco Government & Agency Portfolio, Institutional Class, 0.03%(e)(f) | 551,574 | 551,574 | ||||||
| ||||||||
Invesco Liquid Assets Portfolio, Institutional Class, 0.01%(e)(f) | 393,753 | 393,910 | ||||||
| ||||||||
Invesco Treasury Portfolio, Institutional Class, 0.01%(e)(f) | 630,370 | 630,370 | ||||||
| ||||||||
Total Money Market Funds |
| 1,575,854 | ||||||
| ||||||||
TOTAL INVESTMENTS IN SECURITIES (excluding investments purchased with cash collateral from securities on loan)–99.99% (Cost $1,790,511,215) | 3,844,390,670 | |||||||
| ||||||||
Investments Purchased with Cash Collateral from Securities on Loan |
| |||||||
Money Market Funds–2.36% | ||||||||
Invesco Private Government Fund, 0.01%(e)(f)(g) | 36,363,174 | 36,363,174 | ||||||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 | Invesco Summit Fund |
Shares | Value | |||||||
| ||||||||
Money Market Funds–(continued) |
| |||||||
Invesco Private Prime Fund, 0.11%(e)(f)(g) | 54,522,951 | $ | 54,544,761 | |||||
| ||||||||
Total Investments Purchased with Cash Collateral from Securities on Loan (Cost $90,907,935) |
| 90,907,935 | ||||||
| ||||||||
TOTAL INVESTMENTS IN SECURITIES–102.35% |
| |||||||
(Cost $1,881,419,150) | 3,935,298,605 | |||||||
| ||||||||
OTHER ASSETS LESS LIABILITIES–(2.35)% |
| (90,495,098 | ) | |||||
| ||||||||
NET ASSETS–100.00% |
| $ | 3,844,803,507 | |||||
|
Investment Abbreviations:
ADR – American Depositary Receipt
REIT – Real Estate Investment Trust
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | All or a portion of this security was out on loan at April 30, 2021. |
(d) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2021 was $31,468,507, which represented less than 1% of the Fund’s Net Assets. |
(e) | Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the six months ended April 30, 2021. |
Value October 31, 2020 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation | Realized Gain (Loss) | Value April 30, 2021 | Dividend Income | |||||||||||||||||||||||||||||
Investments in Affiliated Money Market Funds: | |||||||||||||||||||||||||||||||||||
Invesco Government & Agency Portfolio, Institutional Class | $ | 2,125,293 | $ | 62,265,522 | $ | (63,839,241 | ) | $ | - | $ | - | $ | 551,574 | $ | 156 | ||||||||||||||||||||
Invesco Liquid Assets Portfolio, Institutional Class | 1,514,993 | 44,475,373 | (45,596,413 | ) | 151 | (194 | ) | 393,910 | 166 | ||||||||||||||||||||||||||
Invesco Treasury Portfolio, Institutional Class | 2,428,906 | 71,160,597 | (72,959,133 | ) | - | - | 630,370 | 75 | |||||||||||||||||||||||||||
Investments Purchased with Cash Collateral from Securities on Loan: | |||||||||||||||||||||||||||||||||||
Invesco Private Government Fund | 8,102,257 | 189,979,822 | (161,718,905 | ) | - | - | 36,363,174 | 1,543 | * | ||||||||||||||||||||||||||
Invesco Private Prime Fund | 12,153,385 | 251,679,444 | (209,290,807 | ) | - | 2,739 | 54,544,761 | 14,609 | * | ||||||||||||||||||||||||||
Total | $ | 26,324,834 | $ | 619,560,758 | $ | (553,404,499 | ) | $ | 151 | $ | 2,545 | $ | 92,483,789 | $ | 16,549 |
* | Represents the income earned on the investment of cash collateral, which is included in securities lending income on the Statement of Operations. Does not include rebates and fees paid to lending agent or premiums received from borrowers, if any. |
(f) | The rate shown is the 7-day SEC standardized yield as of April 30, 2021. |
(g) | The security has been segregated to satisfy the commitment to return the cash collateral received in securities lending transactions upon the borrower’s return of the securities loaned. See Note 1I. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2021
Information Technology | 31.58 | % | |||
Consumer Discretionary | 21.46 | ||||
Communication Services | 18.47 | ||||
Health Care | 10.71 | ||||
Industrials | 7.25 | ||||
Financials | 2.77 | ||||
Energy | 2.37 | ||||
Consumer Staples | 2.12 | ||||
Other Sectors, Each Less than 2% of Net Assets | 3.22 | ||||
Money Market Funds Plus Other Assets Less Liabilities | 0.05 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 | Invesco Summit Fund |
Statement of Assets and Liabilities
April 30, 2021
(Unaudited)
Assets: | ||||
Investments in securities, at value | $ | 3,842,814,816 | ||
| ||||
Investments in affiliated money market funds, at value | 92,483,789 | |||
| ||||
Foreign currencies, at value (Cost $675) | 720 | |||
| ||||
Receivable for: | ||||
Investments sold | 1,184,421 | |||
| ||||
Fund shares sold | 987,426 | |||
| ||||
Dividends | 2,089,677 | |||
| ||||
Investment for trustee deferred compensation and retirement plans | 416,559 | |||
| ||||
Other assets | 107,674 | |||
| ||||
Total assets | 3,940,085,082 | |||
| ||||
Liabilities: | ||||
Payable for: | ||||
Fund shares reacquired | 843,446 | |||
| ||||
Amount due custodian | 1,944,746 | |||
| ||||
Collateral upon return of securities loaned | 90,907,935 | |||
| ||||
Accrued fees to affiliates | 834,402 | |||
| ||||
Accrued trustees’ and officers’ fees and benefits | 131 | |||
| ||||
Accrued other operating expenses | 286,903 | |||
| ||||
Trustee deferred compensation and retirement plans | 464,012 | |||
| ||||
Total liabilities | 95,281,575 | |||
| ||||
Net assets applicable to shares outstanding | $ | 3,844,803,507 | ||
| ||||
Net assets consist of: | ||||
Shares of beneficial interest | $ | 1,409,130,490 | ||
| ||||
Distributable earnings | 2,435,673,017 | |||
| ||||
$3,844,803,507 | ||||
|
Net Assets: | ||||
Class A | $ | 419,140,172 | ||
| ||||
Class C | $ | 29,721,263 | ||
| ||||
Class P | $ | 3,285,249,103 | ||
| ||||
Class S | $ | 5,567,987 | ||
| ||||
Class Y | $ | 81,547,188 | ||
| ||||
Class R5 | $ | 1,720,940 | ||
| ||||
Class R6 | $ | 21,856,854 | ||
| ||||
Shares outstanding, no par value, with an unlimited number of shares authorized: |
| |||
Class A | 13,328,607 | |||
| ||||
Class C | 1,102,360 | |||
| ||||
Class P | 102,095,529 | |||
| ||||
Class S | 175,044 | |||
| ||||
Class Y | 2,536,156 | |||
| ||||
Class R5 | 53,240 | |||
| ||||
Class R6 | 674,857 | |||
| ||||
Class A: | ||||
Net asset value per share | $ | 31.45 | ||
| ||||
Maximum offering price per share | ||||
(Net asset value of $31.45 ÷ 94.50%) | $ | 33.28 | ||
| ||||
Class C: | ||||
Net asset value and offering price per share | $ | 26.96 | ||
| ||||
Class P: | ||||
Net asset value and offering price per share | $ | 32.18 | ||
| ||||
Class S: | ||||
Net asset value and offering price per share | $ | 31.81 | ||
| ||||
Class Y: | ||||
Net asset value and offering price per share | $ | 32.15 | ||
| ||||
Class R5: | ||||
Net asset value and offering price per share | $ | 32.32 | ||
| ||||
Class R6: | ||||
Net asset value and offering price per share | $ | 32.39 | ||
|
* | At April 30, 2021, securities with an aggregate value of $87,187,454 were on loan to brokers. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 | Invesco Summit Fund |
Statement of Operations
For the six months ended April 30, 2021
(Unaudited)
Investment income: | ||||
Dividends (net of foreign withholding taxes of $186,886) | $ | 8,408,112 | ||
| ||||
Dividends from affiliated money market funds (includes securities lending income of $548,765) | 549,162 | |||
| ||||
Total investment income | 8,957,274 | |||
| ||||
Expenses: | ||||
Advisory fees | 11,248,161 | |||
| ||||
Administrative services fees | 229,743 | |||
| ||||
Custodian fees | 34,522 | |||
| ||||
Distribution fees: | ||||
Class A | 453,940 | |||
| ||||
Class C | 139,362 | |||
| ||||
Class P | 1,540,414 | |||
| ||||
Class S | 3,905 | |||
| ||||
Transfer agent fees – A, C, P, S and Y | 1,173,927 | |||
| ||||
Transfer agent fees – R5 | 663 | |||
| ||||
Transfer agent fees – R6 | 1,955 | |||
| ||||
Trustees’ and officers’ fees and benefits | 49,457 | |||
| ||||
Registration and filing fees | 63,380 | |||
| ||||
Reports to shareholders | 93,403 | |||
| ||||
Professional services fees | 38,528 | |||
| ||||
Other | 37,141 | |||
| ||||
Total expenses | 15,108,501 | |||
| ||||
Less: Fees waived and/or expense offset arrangement(s) | (5,752 | ) | ||
| ||||
Net expenses | 15,102,749 | |||
| ||||
Net investment income (loss) | (6,145,475 | ) | ||
| ||||
Realized and unrealized gain from: | ||||
Net realized gain from: | ||||
Unaffiliated investment securities | 394,904,723 | |||
| ||||
Affiliated investment securities | 2,545 | |||
| ||||
Foreign currencies | 22,863 | |||
| ||||
394,930,131 | ||||
| ||||
Change in net unrealized appreciation of: | ||||
Unaffiliated investment securities | 463,221,946 | |||
| ||||
Affiliated investment securities | 151 | |||
| ||||
Foreign currencies | 6,788 | |||
| ||||
463,228,885 | ||||
| ||||
Net realized and unrealized gain | 858,159,016 | |||
| ||||
Net increase in net assets resulting from operations | $ | 852,013,541 | ||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 | Invesco Summit Fund |
Statement of Changes in Net Assets
For the six months ended April 30, 2021 and the year ended October 31, 2020
(Unaudited)
April 30, 2021 | October 31, 2020 | |||||||
| ||||||||
Operations: | ||||||||
Net investment income (loss) | $ | (6,145,475 | ) | $ | (4,668,587 | ) | ||
| ||||||||
Net realized gain | 394,930,131 | 219,177,591 | ||||||
| ||||||||
Change in net unrealized appreciation | 463,228,885 | 532,265,804 | ||||||
| ||||||||
Net increase in net assets resulting from operations | 852,013,541 | 746,774,808 | ||||||
| ||||||||
Distributions to shareholders from distributable earnings: | ||||||||
Class A | (21,485,446 | ) | (14,994,428 | ) | ||||
| ||||||||
Class C | (2,085,344 | ) | (1,516,859 | ) | ||||
| ||||||||
Class P | (188,404,545 | ) | (184,239,073 | ) | ||||
| ||||||||
Class S | (318,745 | ) | (302,981 | ) | ||||
| ||||||||
Class Y | (4,370,534 | ) | (1,186,928 | ) | ||||
| ||||||||
Class R5 | (69,406 | ) | (20,136 | ) | ||||
| ||||||||
Class R6 | (1,159,595 | ) | (1,054,022 | ) | ||||
| ||||||||
Total distributions from distributable earnings | (217,893,615 | ) | (203,314,427 | ) | ||||
| ||||||||
Share transactions–net: | ||||||||
Class A | 56,237,460 | 84,342,766 | ||||||
| ||||||||
Class C | 774,808 | 5,301,251 | ||||||
| ||||||||
Class P | 58,956,976 | (13,556,735 | ) | |||||
| ||||||||
Class S | 212,364 | (74,683 | ) | |||||
| ||||||||
Class Y | 22,658,519 | 28,074,701 | ||||||
| ||||||||
Class R5 | 483,038 | 772,733 | ||||||
| ||||||||
Class R6 | 1,949,844 | 976,932 | ||||||
| ||||||||
Net increase in net assets resulting from share transactions | 141,273,009 | 105,836,965 | ||||||
| ||||||||
Net increase in net assets | 775,392,935 | 649,297,346 | ||||||
| ||||||||
Net assets: | ||||||||
Beginning of period | 3,069,410,572 | 2,420,113,226 | ||||||
| ||||||||
End of period | $ | 3,844,803,507 | $ | 3,069,410,572 | ||||
|
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 | Invesco Summit Fund |
(Unaudited)
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return (b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover (c) | |||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | $ | 26.25 | $ | (0.07 | ) | $ | 7.17 | $ | 7.10 | $ | – | $ | (1.90 | ) | $ | (1.90 | ) | $ | 31.45 | 27.92 | % | $ | 419,140 | 0.98 | %(d) | 0.98 | %(d) | (0.48 | )%(d) | 24 | % | |||||||||||||||||||||||||
Year ended 10/31/20 | 21.77 | (0.07 | ) | 6.42 | 6.35 | – | (1.87 | ) | (1.87 | ) | 26.25 | 31.23 | 299,616 | 0.99 | 0.99 | (0.30 | ) | 38 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 20.75 | (0.04 | ) | 3.17 | 3.13 | – | (2.11 | ) | (2.11 | ) | 21.77 | 17.36 | 169,883 | 1.01 | 1.01 | (0.18 | ) | 29 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.14 | (0.05 | ) | 1.41 | 1.36 | – | (0.75 | ) | (0.75 | ) | 20.75 | 6.95 | 114,570 | 1.02 | 1.02 | (0.24 | ) | 35 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 16.56 | (0.02 | ) | 4.60 | 4.58 | – | (1.00 | ) | (1.00 | ) | 20.14 | 29.20 | 77,519 | 1.04 | 1.04 | (0.13 | ) | 31 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 17.59 | (0.01 | ) | 0.11 | 0.10 | – | (1.13 | ) | (1.13 | ) | 16.56 | 0.81 | 50,217 | 1.05 | 1.05 | (0.05 | ) | 47 | ||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 22.82 | (0.15 | ) | 6.19 | 6.04 | – | (1.90 | ) | (1.90 | ) | 26.96 | 27.44 | 29,721 | 1.73 | (d) | 1.73 | (d) | (1.23 | )(d) | 24 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 19.29 | (0.22 | ) | 5.62 | 5.40 | – | (1.87 | ) | (1.87 | ) | 22.82 | 30.25 | 24,427 | 1.74 | 1.74 | (1.05 | ) | 38 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 18.77 | (0.17 | ) | 2.80 | 2.63 | – | (2.11 | ) | (2.11 | ) | 19.29 | 16.43 | 15,470 | 1.76 | 1.76 | (0.93 | ) | 29 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 18.41 | (0.19 | ) | 1.30 | 1.11 | – | (0.75 | ) | (0.75 | ) | 18.77 | 6.22 | 16,792 | 1.77 | 1.77 | (0.99 | ) | 35 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 15.34 | (0.15 | ) | 4.22 | 4.07 | – | (1.00 | ) | (1.00 | ) | 18.41 | 28.15 | 9,325 | 1.79 | 1.79 | (0.88 | ) | 31 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 16.49 | (0.12 | ) | 0.10 | (0.02 | ) | – | (1.13 | ) | (1.13 | ) | 15.34 | 0.09 | 5,008 | 1.80 | 1.80 | (0.80 | ) | 47 | |||||||||||||||||||||||||||||||||||||
Class P | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 26.80 | (0.05 | ) | 7.33 | 7.28 | – | (1.90 | ) | (1.90 | ) | 32.18 | 28.02 | 3,285,249 | 0.83 | (d) | 0.83 | (d) | (0.33 | )(d) | 24 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 22.16 | (0.04 | ) | 6.55 | 6.51 | – | (1.87 | ) | (1.87 | ) | 26.80 | 31.42 | 2,675,601 | 0.84 | 0.84 | (0.15 | ) | 38 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 21.05 | (0.01 | ) | 3.23 | 3.22 | – | (2.11 | ) | (2.11 | ) | 22.16 | 17.55 | 2,204,984 | 0.86 | 0.86 | (0.03 | ) | 29 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.39 | (0.02 | ) | 1.43 | 1.41 | (0.00 | ) | (0.75 | ) | (0.75 | ) | 21.05 | 7.13 | 2,024,211 | 0.87 | 0.87 | (0.09 | ) | 35 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 16.75 | 0.00 | 4.65 | 4.65 | (0.01 | ) | (1.00 | ) | (1.01 | ) | 20.39 | 29.32 | 2,044,421 | 0.89 | 0.89 | 0.02 | 31 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 17.75 | 0.02 | 0.11 | 0.13 | – | (1.13 | ) | (1.13 | ) | 16.75 | 0.98 | 1,708,869 | 0.90 | 0.90 | 0.10 | 47 | ||||||||||||||||||||||||||||||||||||||||
Class S | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 26.52 | (0.06 | ) | 7.25 | 7.19 | – | (1.90 | ) | (1.90 | ) | 31.81 | 27.97 | 5,568 | 0.88 | (d) | 0.88 | (d) | (0.38 | )(d) | 24 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 21.95 | (0.05 | ) | 6.49 | 6.44 | – | (1.87 | ) | (1.87 | ) | 26.52 | 31.40 | 4,435 | 0.89 | 0.89 | (0.20 | ) | 38 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 20.89 | (0.02 | ) | 3.19 | 3.17 | – | (2.11 | ) | (2.11 | ) | 21.95 | 17.44 | 3,711 | 0.91 | 0.91 | (0.08 | ) | 29 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.24 | (0.03 | ) | 1.43 | 1.40 | – | (0.75 | ) | (0.75 | ) | 20.89 | 7.12 | 3,405 | 0.92 | 0.92 | (0.14 | ) | 35 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 16.63 | (0.01 | ) | 4.62 | 4.61 | (0.00 | ) | (1.00 | ) | (1.00 | ) | 20.24 | 29.29 | 3,521 | 0.94 | 0.94 | (0.03 | ) | 31 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 17.64 | 0.01 | 0.11 | 0.12 | – | (1.13 | ) | (1.13 | ) | 16.63 | 0.92 | 3,164 | 0.95 | 0.95 | 0.05 | 47 | ||||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 26.77 | (0.03 | ) | 7.31 | 7.28 | – | (1.90 | ) | (1.90 | ) | 32.15 | 28.05 | 81,547 | 0.73 | (d) | 0.73 | (d) | (0.23 | )(d) | 24 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 22.12 | (0.01 | ) | 6.53 | 6.52 | – | (1.87 | ) | (1.87 | ) | 26.77 | 31.53 | 47,894 | 0.74 | 0.74 | (0.05 | ) | 38 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 21.00 | 0.02 | 3.21 | 3.23 | – | (2.11 | ) | (2.11 | ) | 22.12 | 17.65 | 13,414 | 0.76 | 0.76 | 0.07 | 29 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.34 | 0.00 | 1.43 | 1.43 | (0.02 | ) | (0.75 | ) | (0.77 | ) | 21.00 | 7.25 | 14,818 | 0.77 | 0.77 | 0.01 | 35 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 16.71 | 0.02 | 4.64 | 4.66 | (0.03 | ) | (1.00 | ) | (1.03 | ) | 20.34 | 29.46 | 13,881 | 0.79 | 0.79 | 0.12 | 31 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 17.69 | 0.03 | 0.12 | 0.15 | – | (1.13 | ) | (1.13 | ) | 16.71 | 1.10 | 3,576 | 0.80 | 0.80 | 0.20 | 47 | ||||||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 26.91 | (0.04 | ) | 7.35 | 7.31 | – | (1.90 | ) | (1.90 | ) | 32.32 | 28.02 | 1,721 | 0.76 | (d) | 0.76 | (d) | (0.26 | )(d) | 24 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 22.22 | (0.02 | ) | 6.58 | 6.56 | – | (1.87 | ) | (1.87 | ) | 26.91 | 31.57 | 1,002 | 0.76 | 0.76 | (0.07 | ) | 38 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 21.09 | 0.01 | 3.23 | 3.24 | – | (2.11 | ) | (2.11 | ) | 22.22 | 17.63 | 96 | 0.77 | 0.77 | 0.06 | 29 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.42 | 0.01 | 1.43 | 1.44 | (0.02 | ) | (0.75 | ) | (0.77 | ) | 21.09 | 7.30 | 73 | 0.72 | 0.72 | 0.06 | 35 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 16.77 | 0.03 | 4.66 | 4.69 | (0.04 | ) | (1.00 | ) | (1.04 | ) | 20.42 | 29.56 | 20 | 0.76 | 0.76 | 0.15 | 31 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 17.75 | 0.04 | 0.11 | 0.15 | – | (1.13 | ) | (1.13 | ) | 16.77 | 1.10 | 17 | 0.74 | 0.74 | 0.26 | 47 | ||||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/21 | 26.95 | (0.03 | ) | 7.37 | 7.34 | – | (1.90 | ) | (1.90 | ) | 32.39 | 28.09 | 21,857 | 0.68 | (d) | 0.68 | (d) | (0.18 | )(d) | 24 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/20 | 22.24 | (0.00 | ) | 6.58 | 6.58 | – | (1.87 | ) | (1.87 | ) | 26.95 | 31.64 | 16,436 | 0.70 | 0.70 | (0.01 | ) | 38 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/19 | 21.09 | 0.03 | 3.23 | 3.26 | – | (2.11 | ) | (2.11 | ) | 22.24 | 17.73 | 12,556 | 0.71 | 0.71 | 0.12 | 29 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/18 | 20.42 | 0.01 | 1.43 | 1.44 | (0.02 | ) | (0.75 | ) | (0.77 | ) | 21.09 | 7.29 | 11,057 | 0.72 | 0.72 | 0.06 | 35 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17(e) | 17.61 | 0.01 | 2.80 | 2.81 | – | – | – | 20.42 | 15.96 | 12 | 0.77 | (f) | 0.77 | (f) | 0.14 | (f) | 31 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $366,161, $28,103, $3,106,359, $5,250, $68,316, $1,337 and $19,714 for Class A, Class C, Class P, Class S, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Commencement date of April 04, 2017. |
(f) | Annualized. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 | Invesco Summit Fund |
April 30, 2021
(Unaudited)
NOTE 1–Significant Accounting Policies
Invesco Summit Fund (the “Fund”) is a series portfolio of AIM Equity Funds (Invesco Equity Funds) (the “Trust”). The Trust is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. The Fund is classified as non-diversified. The Fund’s classification changed from diversified to non-diversified during the period. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of seven different classes of shares: Class A, Class C, Class P, Class S, Class Y, Class R5 and Class R6. Class P shares are not sold to members of the general public. Only shareholders who had accounts in the AIM Summit Investors Plans I and AIM Summit Investors Plans II at the close of business on December 8, 2006, may continue to purchase Class P shares as described in the Fund’s prospectus. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met. Under certain circumstances, load waiver shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class P, Class S, Class Y, Class R5 and Class R6 shares are sold at net asset value. Class C shares held for ten years after purchase are eligible for automatic conversion into Class A shares of the same Fund (the “Conversion Feature”). The automatic conversion pursuant to the Conversion Feature will generally occur at the end of the month following the tenth anniversary after a purchase of Class C shares. Effective November 30, 2020, the automatic conversion pursuant to the Conversion Feature changed from ten years to eight years. The first conversion of Class C shares to Class A shares occurred at the end of December 2020 for all Class C shares that were held for more than eight years as of November 30, 2020.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services - Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations – Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or adverse investor sentiment generally and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income – Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on an accrual basis from |
12 | Invesco Summit Fund |
settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date.
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination – For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions – Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes – The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses – Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications – Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Securities Lending – The Fund may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by collateral equal to no less than the market value of the loaned securities determined daily by the securities lending provider. Such collateral will be cash or debt securities issued or guaranteed by the U.S. Government or any of its sponsored agencies. Cash collateral received in connection with these loans is invested in short-term money market instruments or affiliated money market funds and is shown as such on the Schedule of Investments. The Fund bears the risk of loss with respect to the investment of collateral. It is the Fund’s policy to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be temporarily less than the value of the securities on loan. When loaning securities, the Fund retains certain benefits of owning the securities, including the economic equivalent of dividends or interest generated by the security. Lending securities entails a risk of loss to the Fund if, and to the extent that, the market value of the securities loaned were to increase and the borrower did not increase the collateral accordingly, and the borrower failed to return the securities. The securities loaned are subject to termination at the option of the borrower or the Fund. Upon termination, the borrower will return to the Fund the securities loaned and the Fund will return the collateral. Upon the failure of the borrower to return the securities, collateral may be liquidated and the securities may be purchased on the open market to replace the loaned securities. The Fund could experience delays and costs in gaining access to the collateral and the securities may lose value during the delay which could result in potential losses to the Fund. Some of these losses may be indemnified by the lending agent. The Fund bears the risk of any deficiency in the amount of the collateral available for return to the borrower due to any loss on the collateral invested. Dividends received on cash collateral investments for securities lending transactions, which are net of compensation to counterparties, are included in Dividends from affiliated money market funds on the Statement of Operations. The aggregate value of securities out on loan, if any, is shown as a footnote on the Statement of Assets and Liabilities. |
J. | Foreign Currency Translations – Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized |
13 | Invesco Summit Fund |
foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates.
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
K. | Forward Foreign Currency Contracts – The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
L. | COVID-19 Risk – The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations and supply chains, layoffs, lower consumer demand, and defaults, among other significant economic impacts that have disrupted global economic activity across many industries. Such economic impacts may exacerbate other pre-existing political, social and economic risks locally or globally. |
The ongoing effects of COVID-19 are unpredictable and may result in significant and prolonged effects on the Fund’s performance.
M. | Other Risks – The Fund is non-diversified and may invest in securities of fewer issuers than if it were diversified. Thus, the value of the Fund’s shares may vary more widely and the Fund may be subject to greater market and credit risk than if the Fund invested more broadly. |
NOTE 2–Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $10 million | 1.000 | % | ||
Next $140 million | 0.750 | % | ||
Over $150 million | 0.625 | % |
For the six months ended April 30, 2021, the effective advisory fee rate incurred by the Fund was 0.63%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2022, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class P, Class S, Class Y, Class R5 and Class R6 shares to 2.00%, 2.75%, 1.85%, 1.90%, 1.75%, 1.75% and 1.75%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2022. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2023, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash (excluding investments of cash collateral from securities lending) in such affiliated money market funds.
For the six months ended April 30, 2021, the Adviser waived advisory fees of $1,613.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees. Invesco has entered into a sub-administration agreement whereby State Street Bank and Trust Company (“SSB”) serves as fund accountant and provides certain administrative services to the Fund. Pursuant to a custody agreement with the Trust on behalf of the Fund, SSB also serves as the Fund’s custodian.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2021, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Fund has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class P, Class S, Class Y, Class R5 and Class R6 shares. The Fund has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C shares, Class P shares and Class S shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 0.10% of the average daily net assets of Class P shares and 0.15% of the average daily net assets of Class S shares. The Fund pursuant to the Class C Plan, reimburses IDI for its allocated share of expenses incurred for the period, up to a maximum annual rate of 1.00% of the average daily net assets of Class C shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of Class A and Class C shares, 0.10% of the average daily net assets of Class P shares and 0.15% of the average daily net assets of Class S shares may be paid to furnish continuing personal
14 | Invesco Summit Fund |
shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2021, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2021, IDI advised the Fund that IDI retained $123,139 in front-end sales commissions from the sale of Class A shares and $724 and $964 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
For the six months ended April 30, 2021, the Fund incurred $24,002 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3–Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 – | Prices are determined using quoted prices in an active market for identical assets. | |
Level 2 – | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. | |
Level 3 – | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2021. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Common Stocks & Other Equity Interests | $ | 3,627,575,116 | $ | 215,239,700 | $ | – | $ | 3,842,814,816 | ||||||||
Money Market Funds | 1,575,854 | 90,907,935 | – | 92,483,789 | ||||||||||||
Total Investments | $ | 3,629,150,970 | $ | 306,147,635 | $ | – | $ | 3,935,298,605 |
NOTE 4–Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2021, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $4,139.
NOTE 5–Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6–Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks or broker-dealers exceed 5% of the Fund’s total assets, or when any borrowings from an Invesco Fund are outstanding.
NOTE 7–Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP.
Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2020.
15 | Invesco Summit Fund |
NOTE 8–Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Government obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2021 was $847,224,085 and $927,364,766, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis
Aggregate unrealized appreciation of investments | $ | 2,094,701,158 | ||
Aggregate unrealized (depreciation) of investments | (47,349,070 | ) | ||
Net unrealized appreciation of investments | $ | 2,047,352,088 |
Cost of investments for tax purposes is $1,887,946,517.
NOTE 9–Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2021 | Year ended October 31, 2020 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 2,612,375 | $ | 77,464,492 | 5,448,472 | $ | 127,230,261 | ||||||||||
Class C | 199,869 | 5,113,927 | 541,886 | 10,937,631 | ||||||||||||
Class P | 471,329 | 14,174,784 | 1,114,297 | 25,529,263 | ||||||||||||
Class S | 716 | 22,184 | 3,107 | 74,702 | ||||||||||||
Class Y | 1,847,864 | 57,400,111 | 1,812,498 | 41,601,017 | ||||||||||||
Class R5 | 17,489 | 529,086 | 34,057 | 806,449 | ||||||||||||
Class R6 | 109,134 | 3,348,461 | 146,558 | 3,433,901 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 729,917 | 20,532,561 | 676,587 | 14,282,743 | ||||||||||||
Class C | 79,694 | 1,927,797 | 75,056 | 1,386,283 | ||||||||||||
Class P | 6,401,296 | 184,165,275 | 8,379,716 | 180,331,486 | ||||||||||||
Class S | 10,972 | 312,050 | 13,931 | 296,735 | ||||||||||||
Class Y | 146,242 | 4,203,003 | 45,921 | 986,374 | ||||||||||||
Class R5 | 2,336 | 67,515 | 847 | 18,283 | ||||||||||||
Class R6 | 39,106 | 1,131,717 | 47,475 | 1,025,940 | ||||||||||||
Automatic conversion of Class C shares to Class A shares: | ||||||||||||||||
Class A | 123,406 | 3,630,120 | 31,617 | 735,370 | ||||||||||||
Class C | (143,641 | ) | (3,630,120 | ) | (36,182 | ) | (735,370 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (1,551,051 | ) | (45,389,713 | ) | (2,547,255 | ) | (57,905,608 | ) | ||||||||
Class C | (103,790 | ) | (2,636,796 | ) | (312,517 | ) | (6,287,293 | ) | ||||||||
Class P | (4,601,955 | ) | (139,383,083 | ) | (9,184,148 | ) | (219,417,484 | ) | ||||||||
Class S | (3,905 | ) | (121,870 | ) | (18,811 | ) | (446,120 | ) | ||||||||
Class Y | (1,246,720 | ) | (38,944,595 | ) | (676,154 | ) | (14,512,690 | ) | ||||||||
Class R5 | (3,818 | ) | (113,563 | ) | (1,977 | ) | (51,999 | ) | ||||||||
Class R6 | (83,301 | ) | (2,530,334 | ) | (148,742 | ) | (3,482,909 | ) | ||||||||
Net increase in share activity | 5,053,564 | $ | 141,273,009 | 5,446,239 | $ | 105,836,965 |
16 | Invesco Summit Fund |
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2020 through April 30, 2021.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
ACTUAL | HYPOTHETICAL (5% annual return before expenses) | |||||||||||
Beginning Account Value (11/01/20) | Ending Account Value (04/30/21)1 | Expenses Paid During Period2 | Ending Account Value (04/30/21) | Expenses Paid During Period2 | Annualized Expense Ratio | |||||||
Class A | $1,000.00 | $1,279.20 | $5.54 | $1,019.93 | $4.91 | 0.98% | ||||||
Class C | 1,000.00 | 1,274.40 | 9.76 | 1,016.22 | 8.65 | 1.73 | ||||||
Class P | 1,000.00 | 1,280.20 | 4.69 | 1,020.68 | 4.16 | 0.83 | ||||||
Class S | 1,000.00 | 1,279.70 | 4.97 | 1,020.43 | 4.41 | 0.88 | ||||||
Class Y | 1,000.00 | 1,280.50 | 4.13 | 1,021.17 | 3.66 | 0.73 | ||||||
Class R5 | 1,000.00 | 1,280.20 | 4.30 | 1,021.03 | 3.81 | 0.76 | ||||||
Class R6 | 1,000.00 | 1,280.90 | 3.85 | 1,021.42 | 3.41 | 0.68 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2020 through April 30, 2021, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
17 | Invesco Summit Fund |
A Virtual Special Meeting (“Meeting”) of Shareholders of Invesco Summit Fund (the “Fund”) was held on January 22, 2021 and was adjourned until February 19, 2021. The Meeting on February 19, 2021 was held for the following purpose:
(1) Approval of changing the Fund’s sub-classification from “diversified” to “non-diversified” and approve the elimination of a related fundamental investment restriction.
The February 19, 2021 results of the voting on the above matter were as follows:
Matters | Votes For | Votes Against | Votes Abstain | |||||||||||
(1) | Approval of changing the Fund’s sub-classification from “diversified” to “non-diversified” and approve the elimination of a related fundamental investment restriction | 47,424,335.28 | 10,100,840.26 | 3,822,645.03 |
18 | Invesco Summit Fund |
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Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ | Fund reports and prospectuses |
∎ | Quarterly statements |
∎ | Daily confirmations |
∎ | Tax forms |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its portfolio holdings four times each fiscal year, at the end of each fiscal quarter. For the second and fourth quarters, the list appears, respectively, in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the list with the Securities and Exchange Commission (SEC) as an exhibit to its reports on Form N-PORT. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Form N-PORT filings on the SEC website, sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246, or at invesco.com/ corporate/about-us/esg. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. This information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-01424 and 002-25469 Invesco Distributors, Inc. SUM-SAR-1
ITEM 2. CODE OF ETHICS.
Not applicable for a semi-annual report.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Investments in securities of unaffiliated issuers is included as part of the reports to stockholders filed under Item 1 of this Form.
ITEM 7. | DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
ITEM 8. | PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT COMPANIES. |
Not applicable.
ITEM 9. | PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. |
Not applicable.
ITEM 10. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. |
None
ITEM 11. | CONTROLS AND PROCEDURES. |
(a) | As of June 18, 2021, an evaluation was performed under the supervision and with the participation of the officers of the Registrant, including the Principal Executive Officer (“PEO”) and Principal Financial Officer (“PFO”), to assess the effectiveness of the Registrant’s disclosure controls and procedures, as that term is defined in Rule 30a-3(c) under the Investment Company Act of 1940 (“Act”), as amended. Based on that evaluation, the Registrant’s officers, including the PEO and PFO, concluded that, as of June 18, 2021, the Registrant’s disclosure controls and procedures were reasonably designed so as to ensure: (1) that information required to be disclosed by the Registrant on Form N-CSR is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Securities and Exchange Commission; and (2) that material information relating to the Registrant is made known to the PEO and PFO as appropriate to allow timely decisions regarding required disclosure. |
(b) | There have been no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting. |
ITEM 12. | DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
ITEM 13. | EXHIBITS. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Registrant: AIM Equity Funds (Invesco Equity Funds)
By: | /s/ Sheri Morris | |
Sheri Morris | ||
Principal Executive Officer | ||
Date: | July 8, 2021 |
Pursuant to the requirements of the Securities and Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
By: | /s/ Sheri Morris | |
Sheri Morris | ||
Principal Executive Officer | ||
Date: | July 8, 2021 |
By: | /s/ Adrien Deberghes | |
Adrien Deberghes | ||
Principal Financial Officer | ||
Date: | July 8, 2021 |