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 | 811-21265 | |||||||
| ||||||||
PowerShares Exchange-Traded Fund Trust | ||||||||
(Exact name of registrant as specified in charter) | ||||||||
| ||||||||
301 W. Roosevelt Road Wheaton, IL |
| 60187 | ||||||
(Address of principal executive offices) |
| (Zip code) | ||||||
| ||||||||
H. Bruce Bond Chairman and Chief Executive Officer 301 W. Roosevelt Road Wheaton, IL 60187 | ||||||||
(Name and address of agent for service) | ||||||||
| ||||||||
Registrant’s telephone number, including area code: | 800-983-0903 |
| ||||||
| ||||||||
Date of fiscal year end: | April 30 |
| ||||||
| ||||||||
Date of reporting period: | April 30, 2008 |
| ||||||
Item 1. Reports to Stockholders.
The Registrant’s annual report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 is as follows:
2008 Annual Report to Shareholders
30 April 2008
PowerShares Dynamic MagniQuant Portfolio
PowerShares Dynamic Market Portfolio
PowerShares Dynamic OTC Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares NASDAQ NextQ Portfolio
Table of Contents
Shareholder Letter | 2 | ||||||
The Market Environment | 3 | ||||||
Manager's Analysis | 4 | ||||||
Funds' Distribution History | 14 | ||||||
Frequency Distribution of Discounts & Premiums | 16 | ||||||
Fees and Expenses | 18 | ||||||
Broad Market Portfolios | |||||||
Schedules of Investments | |||||||
PowerShares Dynamic MagniQuant Portfolio | 20 | ||||||
PowerShares Dynamic Market Portfolio | 23 | ||||||
PowerShares Dynamic OTC Portfolio | 25 | ||||||
PowerShares FTSE RAFI US 1000 Portfolio | 27 | ||||||
PowerShares NASDAQ NextQ Portfolio | 38 | ||||||
Statements of Assets and Liabilities | 39 | ||||||
Statements of Operations | 40 | ||||||
Statements of Changes in Net Assets | 42 | ||||||
Financial Highlights | 44 | ||||||
Notes to Financial Statements | 47 | ||||||
Report of Independent Registered Public Accounting Firm | 56 | ||||||
Supplemental Information | 57 | ||||||
Information about Advisory Agreements | 63 | ||||||
My Fellow Investors,
It gives me great pleasure to report on the state of your investment in PowerShares Exchange-Traded Funds and to thank you for your continued confidence in Invesco PowerShares Capital Management LLC.
Invesco PowerShares has accomplished a number of corporate and industry achievements in 2007. Some of the most notable successes over the past 12 months are that PowerShares:
• Was the first to receive approval from the SEC to operate actively managed equity and fixed-income ETFs.
• Launched our initial group of international ETFs, which invest directly in securities listed on foreign exchanges. As of April 30, 2008, we had 17 ETFs allowing investors to invest across a wide geographic range.
• Brought out the markets only ETFs investing in insured municipal bonds. These three ETF's were part of our initial entry into the Fixed Income portion of the investment spectrum.
• Further enhanced our reputation as one of the leading innovators in the ETF marketplace when the PowerShares S&P Buy-Write Portfolio was awarded the most innovative new ETF for 2007.
• Expanded our global footprint with the introduction of 14 PowerShares ETFs listed on four major stock exchanges across Europe (London, Milan, Frankfurt and Paris).
• Launched the PowerShares India Portfolio, one of the first ETFs to provide U.S. investors with direct access to securities listed on the India stock exchange.
Another milestone of the past year was the adoption of our new name, Invesco PowerShares – in short, we have a new corporate name. Invesco PowerShares represents the strength of global diversification you get through the combination of Invesco's worldwide resources and PowerShares' market leading ETF capabilities. As one of the world's largest and most diversified global investment organizations, Invesco has more than 500 investment professionals operating in investment centers in 25 cities, a presence in 12 countries and $500 billion in assets under management globally at the end of 2007.
While our name has changed and we have a new corporate logo, our goal of delivering the highest quality investment management available in the ETF structure has not changed and all of the names of your funds and their trading symbols remain the same – as do all of our telephone contact numbers. All of us at Invesco PowerShares will continue to strive to provide you with compelling investment solutions and high-quality customer service. Regardless of market conditions, Invesco PowerShares will hold true to its mission: seeking to build financial security for investors.
Best regards,
H. Bruce Bond
President and Chairman of the Board of Trustees
PowerShares Exchange-Traded Fund Trust
2
The Market Environment
Although the benchmark S&P 500 index hit an all-time high in October, 2007, it capitulated as the subprime mortgage crisis began to negatively affect the balance sheets of major U.S. financial institutions. As a result, volatility (as measured by the CBOE "VIX" index) increased by 46.2% during the April 30, 2007 to April 30, 2008 reporting period. Another dramatic rise over the same timeframe was the price of crude oil, which rallied 72.7%. U.S. economic growth began to slow significantly in Q1 2008, leading to recession concerns addressed by the Federal Reserve Bank through aggressive monetary policy easing (the Fed Fund target rate was cut by 2.25% in 2008). The combination of lower short-term U.S. interest rates and the recycling of petrodollars into European banks caused the U.S. dollar to weaken versus all G7 currencies for the year ended April 30, 2008.
By March, 2008, even the AAA-rated monoline bond insurers succumbed to the U.S. credit crunch. Bond insurer ratings downgrades led to huge displacements within the municipal bond market. An impending liquidity crisis was quelled in mid-March by the Fed via the creation of a $200bn lending facility and the approval of Bear Stearns' sale to JP Morgan. Along with the restoration of confidence in the U.S. financial system came a respectable April rally in the U.S. equity market, leaving the S&P 500 with a yearly total return of -4.68% over the reporting period while the DJIA was 0.47% and the NASDAQ-100 was +3.18%. For the same period, the Lehman Brothers U.S. Aggregate Total Return bond index was 6.87%.
3
Manager's Analysis
PowerShares Dynamic MagniQuant Portfolio (ticker: PIQ)
The PowerShares Dynamic MagniQuant Portfolio returned -9.81% over the reporting period, while the S&P 500® Index returned -4.68% and the Russell 3000® Index returned -5.16%. Materials and energy stocks contributed the most to performance, while financials and consumer discretionary stocks contributed negatively. Relative to the broad U.S. market, the Fund benefited from the index's effective stock selection among diversified financials and banks; the Index's stock selection was not effective among energy companies and software services companies.
The PowerShares Dynamic MagniQuant Portfolio bases its stock selection, portfolio management, and asset allocation decisions on an enhanced index called the Dynamic Top 200 IntellidexSM Index. The Fund utilized a direct Index replication method during the reporting period less fees and expenses.
The Index's investment decisions are derived from a proprietary methodology which incorporates some of the most technically advanced and robust institutional investment research available in the marketplace today. Domestic companies are evaluated for inclusion in the Index across numerous investment criteria including, fundamentals, valuation, timeliness and risk perspectives, providing a comprehensive determination of company's overall investment potential. Securities identified by the criteria that possess the greatest capital appreciation potential are selected for the index and incorporated by the portfolio manager.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 24.3 | ||||||
Information Technology | 23.2 | ||||||
Industrials | 15.3 | ||||||
Consumer Discretionary | 11.4 | ||||||
Health Care | 8.1 | ||||||
Energy | 7.0 | ||||||
Materials | 3.7 | ||||||
Utilities | 3.7 | ||||||
Consumer Staples | 2.5 | ||||||
Telecommunications Services | 0.8 | ||||||
Money Market Fund | 0.4 | ||||||
Other | (0.4 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Safeco Corp. | 0.7 | ||||||
Apple Computer, Inc. | 0.7 | ||||||
Ansoft Corp. | 0.7 | ||||||
Plantomics, Inc. | 0.6 | ||||||
Semtech Corp. | 0.6 | ||||||
Rock-Tenn Co., Class A | 0.6 | ||||||
Garnder Denver, Inc. | 0.6 | ||||||
Amphenol Corp., Class A | 0.6 | ||||||
National Semiconductor Corp. | 0.6 | ||||||
Polaris Industries, Inc. | 0.6 | ||||||
Total | 6.3 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Mid-Cap Value | 25.5 | ||||||
Mid-Cap Growth | 21.6 | ||||||
Small-Cap Value | 18.4 | ||||||
Large-Cap Value | 14.3 | ||||||
Large-Cap Growth | 13.9 | ||||||
Small-Cap Growth | 6.3 |
4
Manager's Analysis (Continued)
PowerShares Dynamic MagniQuant Portfolio (ticker: PIQ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Top 200 IntellidexSM Index | -9.18 | 0.56 | 0.86 | ||||||||||||
S&P 500® Index | -4.68 | 3.00 | 4.71 | ||||||||||||
Russell 3000® Index | -5.16 | 2.83 | 4.43 |
Fund
NAV Return | -9.81 | -0.13 | -0.20 | ||||||||||||
Share Price Return | -9.95 | -0.12 | -0.19 |
Fund Inception: 12 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.95%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.67% while the Fund's gross total operating expense ratio was 0.72%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 500 and 2,918 common stocks, respectively.
† Average annualized.
5
Manager's Analysis
PowerShares Dynamic Market Portfolio (ticker: PWC)
The PowerShares Dynamic Market Portfolio returned -8.93% over the reporting period, while the S&P 500® Index returned -4.68% and the Russell 3000® Index returned -5.16%. Energy and materials stocks contributed the most to performance, while software and insurance stocks contributed the least. Relative to the broad U.S. market, the Fund benefited from the index's effective stock selection among diversified financials, pharmaceuticals and biotechnology companies; the index's stock selection was not effective among software services and technology hardware companies or household and personal product stocks. The Fund was negatively impacted from poor stock selection among large-cap growth stocks.
The PowerShares Dynamic Market Portfolio bases its stock selection, portfolio management, and asset allocation decisions on an enhanced index called the Dynamic Market Intellidex Index. The Fund utilized a direct index replication method during the reporting period (less fees and expenses).
The Index's components are derived from a proprietary methodology which incorporates some of the most technically advanced and robust institutional investment research available in the marketplace today.
Domestic companies are evaluated for inclusion in the index across numerous investment criteria including, fundamentals, valuation, timeliness and risk perspectives, providing a comprehensive determination of company's overall investment potential. Securities identified by the criteria that possess the greatest capital appreciation potential are selected for the Index and incorporated by the portfolio manager.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 17.7 | ||||||
Information Technology | 15.8 | ||||||
Energy | 12.4 | ||||||
Industrials | 12.3 | ||||||
Health Care | 11.2 | ||||||
Consumer Discretionary | 10.5 | ||||||
Consumer Staples | 9.2 | ||||||
Utilities | 4.0 | ||||||
Materials | 3.9 | ||||||
Telecommunications Services | 3.0 | ||||||
Money Market Fund | 0.1 | ||||||
Other | (0.1 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 34.1 | ||||||
Mid-Cap Growth | 21.9 | ||||||
Large-Cap Growth | 21.8 | ||||||
Mid-Cap Value | 12.3 | ||||||
Small-Cap Value | 6.5 | ||||||
Small-Cap Growth | 3.4 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Occidental Petroleum Corp. | 4.3 | ||||||
Exxon Mobil Corp. | 4.3 | ||||||
Kimberly-Clark Corp. | 3.2 | ||||||
Goodrich Corp. | 3.1 | ||||||
Colgate-Palmolive Co. | 3.0 | ||||||
Sigma-Aldrich Corp. | 2.9 | ||||||
Lockheed Martin Corp. | 2.8 | ||||||
Dominion Resources, Inc. | 2.8 | ||||||
Northrop Grumman Corp. | 2.5 | ||||||
Express Scripts, Inc. | 2.4 | ||||||
Total | 31.3 |
6
Manager's Analysis (Continued)
PowerShares Dynamic Market Portfolio (ticker: PWC)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||||||
1 Year | 3 Year | Avg. Ann.† | Cumulative | ||||||||||||||||
Dynamic Market IntellidexSM Index | -8.54 | 8.34 | 13.63 | 89.84 | |||||||||||||||
S&P 500® Index | -4.68 | 8.23 | 10.60 | 65.74 | |||||||||||||||
Russell 3000® Index | -5.16 | 8.64 | 11.37 | 71.66 |
Fund
NAV Return | -8.93 | 7.98 | 13.03 | 84.52 | |||||||||||||||
Share Price Return | -8.98 | 7.98 | 13.00 | 84.29 |
Fund Inception: 1 May 2003
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.62%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.58% while the Fund's gross total operating expense ratio was 0.59%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 500 and 2,918 common stocks, respectively.
† Average annualized.
7
Manager's Analysis
PowerShares Dynamic OTC Portfolio (ticker: PWO)
The PowerShares Dynamic OTC Portfolio returned -14.65% over the reporting period, while the NASDAQ Composite Index returned -4.45%. Healthcare Equipment and Services and Energy stocks contributed the most to performance, while software, retailing and semiconductor stocks contributed negatively. Relative to the Nasdaq market, the Fund benefited marginally from stock selection among transportation and consumer services companes; the index's stock selection was not effective among technology hardware and software companies. The Nasdaq's significant overweight to large-cap growth companies, such as Apple and Research In Motion Ltd., made it difficult for the Fund to keep pace.
The PowerShares Dynamic OTC Portfolio bases its stock selection, portfolio management, and asset allocation decisions on an enhanced index called the Dynamic OTC IntellidexSM Index. The fund utilized a direct index replication method during the reporting period (less fees and expenses). The Index's components are derived from a proprietary methodology which incorporates some of the most technically advanced and robust institutional investment research available in the marketplace today.
Domestic Nasdaq companies are evaluated for inclusion in the Index across numerous investment criteria including fundamentals, valuation, timeliness and risk perspectives, providing a comprehensive determination of company's overall investment potential. Securities identified by the criteria that possess the greatest capital appreciation potential are selected for the Index and incorporated by the portfolio manager.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Information Technology | 54.4 | ||||||
Health Care | 12.9 | ||||||
Consumer Discretionary | 12.4 | ||||||
Financials | 8.5 | ||||||
Industrials | 6.4 | ||||||
Consumer Staples | 1.7 | ||||||
Energy | 1.5 | ||||||
Telecommunications Services | 1.3 | ||||||
Materials | 0.8 | ||||||
Other | 0.1 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Mid-Cap Growth | 31.7 | ||||||
Large-Cap Growth | 27.0 | ||||||
Small-Cap Growth | 16.7 | ||||||
Mid-Cap Value | 14.7 | ||||||
Small-Cap Value | 9.9 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Apple, Inc. | 4.1 | ||||||
NetApp, Inc. | 3.3 | ||||||
Intel Corp. | 3.3 | ||||||
Oracle Corp. | 3.2 | ||||||
Adobe Systems, Inc. | 3.2 | ||||||
Ansys, Inc. | 3.2 | ||||||
Cisco Systems, Inc. | 3.1 | ||||||
Cadence Design Systems, Inc. | 3.1 | ||||||
Microsoft Corp. | 3.1 | ||||||
Synopsys, Inc. | 2.9 | ||||||
Total | 32.5 |
8
Manager's Analysis (Continued)
PowerShares Dynamic OTC Portfolio (ticker: PWO)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||||||
1 Year | 3 Year | Avg. Ann.† | Cumulative | ||||||||||||||||
Dynamic OTC IntellidexSM Index | -14.24 | 3.97 | 11.09 | 69.48 | |||||||||||||||
NASDAQ Composite Index | -4.45 | 7.88 | 10.35 | 63.85 | |||||||||||||||
NASDAQ-100 Index | 3.17 | 11.02 | 11.88 | 75.60 |
Fund
NAV Return | -14.65 | 3.53 | 10.48 | 64.63 | |||||||||||||||
Share Price Return | -14.63 | 3.53 | 10.46 | 64.50 |
Fund Inception: 1 May 2003
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.68%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.59% while the Fund's gross total operating expense ratio was 0.64%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The NASDAQ Composite Index and the NASDAQ-100 Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 3,087 and 100 common stocks, respectively.
† Average annualized.
9
Manager's Analysis
PowerShares FTSE RAFI US 1000 Portfolio (ticker: PRF)
The Fund seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the FTSE RAFI US 1000 Index. The FTSE RAFI US 1000 Index is designed to track the performance of the largest U.S. equities, selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. U.S. equities are then weighted by each of these four fundamental measures. An overall weight is calculated for each firm by equally-weighting each fundamental measure. Each of the 1000 equities with the highest fundamental weight are then selected and assigned a weight equal to its fundamental weight. The portfolio manager incorporates the stocks selected by the Index into the fund.
Over the reporting period, the PowerShares FTSE RAFI US 1000 Portfolio underperformed the S&P 500® Index, returning -8.42% compared to the S&P 500's -4.68%.
The portfolio was negatively affected by stock selection and allocation in the consumer discretionary sector, and underweighting in the energy sector.
The portfolio suffered from underweighting Apple Inc., Schlumberger Ltd., and Google Inc. The portfolio was also negatively affected by holding Avis Budget Group, Thornburg Mortgage Inc., and AbitibiBowater Inc.
Top performers in the portfolio included Mosaic Co., Tecumseh Products Co., and MasterCard Inc. Top contributors to performance included Exxon Mobil Corp., Wal-Mart Stores, and Chevron Corp. Bottom contributors to performance included Citigroup Inc., American International Group Inc., and Bank of America Corp.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 24.7 | ||||||
Consumer Discretionary | 12.7 | ||||||
Industrials | 10.8 | ||||||
Consumer Staples | 10.0 | ||||||
Information Technology | 9.9 | ||||||
Energy | 9.8 | ||||||
Health Care | 8.6 | ||||||
Utilities | 5.7 | ||||||
Telecommunications Services | 4.1 | ||||||
Materials | 3.7 | ||||||
Money Market Fund | 0.2 | ||||||
Other | (0.2 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Exxon Mobil Corp. | 3.0 | ||||||
Citigroup, Inc. | 2.4 | ||||||
General Electric Co. | 2.3 | ||||||
Bank of America Corp. | 1.8 | ||||||
JPMorgan Chase & Co. | 1.7 | ||||||
Microsoft Corp. | 1.7 | ||||||
Chevron Corp. | 1.6 | ||||||
AT&T, Inc. | 1.6 | ||||||
Verizon Communications, Inc. | 1.4 | ||||||
Wal-Mart Stores, Inc. | 1.4 | ||||||
Total | 18.9 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 51.4 | ||||||
Large-Cap Growth | 22.9 | ||||||
Mid-Cap Value | 14.6 | ||||||
Mid-Cap Growth | 6.6 | ||||||
Small-Cap Value | 3.8 | ||||||
Small-Cap Growth | 0.7 |
10
Manager's Analysis (Continued)
PowerShares FTSE RAFI US 1000 Portfolio (ticker: PRF)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
FTSE RAFI US 1000 Index | -7.85 | 6.43 | 15.93 | ||||||||||||
S&P 500® Index | -4.68 | 6.07 | 15.01 | ||||||||||||
Russell 1000® Index | -4.62 | 6.19 | 15.32 |
Fund
NAV Return | -8.42 | 5.72 | 14.04 | ||||||||||||
Share Price Return | -8.60 | 5.77 | 14.19 |
Fund Inception: 19 December 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.77%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.67% while the Fund's gross total operating expense ratio was 0.66%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index and the Russell 1000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 500 and 1,000 common stocks, respectively.
† Average annualized.
11
Manager's Analysis
PowerShares NASDAQ NextQ Portfolio (ticker: PNXQ)
The PowerShares NASDAQ NextQ Portfolio is based on the NASDAQ Q-50 Index, which is designed to track the performance of the 50 securities that are next in line to replace the securities currently included in the NASDAQ-100® Index®. The Index reflects companies across major non-financial industry groups and is rebalanced quarterly.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Health Care | 36.1 | ||||||
Information Technology | 21.4 | ||||||
Consumer Discretionary | 16.9 | ||||||
Industrials | 16.4 | ||||||
Telecommunications Services | 3.6 | ||||||
Materials | 3.1 | ||||||
Energy | 2.4 | ||||||
Money Market Fund | 0.1 | ||||||
Other | 0.0 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Mid-Cap Growth | 75.7 | ||||||
Mid-Cap Value | 16.3 | ||||||
Large-Cap Growth | 5.9 | ||||||
Large-Cap Value | 2.1 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Millenium Pharmaceuticals, Inc. | 4.5 | ||||||
Urban Outfitters, Inc. | 3.2 | ||||||
Pharmaceutical Product Development, Inc. | 2.8 | ||||||
Priceline.com, Inc. | 2.8 | ||||||
Bucyrus International, Inc., Class A | 2.7 | ||||||
FLIR Systems, Inc. | 2.6 | ||||||
Ross Stores, Inc. | 2.6 | ||||||
Illumina, Inc. | 2.4 | ||||||
Invitrogen Corp. | 2.4 | ||||||
Patterson-UTI Energy, Inc. | 2.4 | ||||||
Total | 28.4 |
12
Manager's Analysis (Continued)
PowerShares NASDAQ NextQ Portfolio (ticker: PNXQ)
Fund Performance History (%) As of 30 April 2008
Index
Fund Inception Cumulative | |||||||
NASDAQ Q-50 Index | 5.70 | ||||||
NASDAQ-100® Index | 3.38 | ||||||
S&P 500® Index | 1.28 |
Fund
NAV Return | 5.71 | ||||||
Share Price Return | 6.51 |
Fund Inception: 3 April 2008
Performance data quoted represents past performance. Past performance is not a guarantee of future results, current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. According to the Fund's current prospectus, the expense ratio of 0.70% is expressed as a unitary fee to cover operating expenses and expenses incurred in connection with managing the portfolio. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The index performance results are hypothetical. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The NASDAQ-100® Index and S&P 500® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 100 and 500 common stocks, respectively.
13
Funds' Distribution History
Ex-Dividend | 3/20/08 | 12/21/07 | 9/21/07 | 6/15/07 | 3/16/07 | 12/15/06 | 9/15/06 | ||||||||||||||||||||||||||||
Record | 3/25/08 | 12/26/07 | 9/25/07 | 6/19/07 | 3/20/07 | 12/19/06 | 9/16/06 | ||||||||||||||||||||||||||||
Payable | 3/31/08 | 12/31/07 | 9/28/07 | 6/29/07 | 3/30/07 | 12/29/06 | 9/29/06 | ||||||||||||||||||||||||||||
Fund | Ticker | ||||||||||||||||||||||||||||||||||
PowerShares Dynamic MagniQuant Portfolio | PIQ | 0.01645 | 0.05241 | 0.04741 | 0.09166 | 0.02020 | 0.03317 | NA | |||||||||||||||||||||||||||
PowerShares Dynamic Market Portfolio | PWC | 0.01282 | 0.15653 | 0.09524 | 0.21355 | 0.06501 | 0.16017 | 0.04994 | |||||||||||||||||||||||||||
PowerShares Dynamic OTC Portfolio | PWO | — | 0.05711 | — | — | — | — | — | |||||||||||||||||||||||||||
PowerShares FTSE RAFI US 1000 Portfolio | PRF | 0.01190 | 0.40732 | 0.11421 | 0.23386 | 0.12360 | 0.20592 | 0.13450 | |||||||||||||||||||||||||||
PowerShares NASDAQ NextQ Portfolio | PNXQ | NA | NA | NA | NA | NA | NA | NA |
Ex-Dividend | 6/18/04 | 3/19/04 | �� | 12/24/03 | 9/19/03 | 6/20/03 | |||||||||||||||||||||
Record | 6/22/04 | 3/23/04 | 12/29/03 | 9/23/03 | 6/24/03 | ||||||||||||||||||||||
Payable | 7/30/04 | 4/30/04 | 1/30/04 | 10/31/03 | 7/31/03 | ||||||||||||||||||||||
Fund | Ticker | ||||||||||||||||||||||||||
PowerShares Dynamic MagniQuant Portfolio | PIQ | NA | NA | NA | NA | NA | |||||||||||||||||||||
PowerShares Dynamic Market Portfolio | PWC | 0.07211 | 0.05300 | 0.03646 | 0.04418 | 0.16848 | |||||||||||||||||||||
PowerShares Dynamic OTC Portfolio | PWO | — | — | — | — | — | |||||||||||||||||||||
PowerShares FTSE RAFI US 1000 Portfolio | PRF | NA | NA | NA | NA | NA | |||||||||||||||||||||
PowerShares NASDAQ NextQ Portfolio | PNXQ | NA | NA | NA | NA | NA |
14
6/16/06 | 3/17/06 | 12/16/05 | 9/16/05 | 6/17/05 | 3/18/05 | 12/17/04 | 9/17/04 | ||||||||||||||||||||||||||||
6/20/06 | 3/21/06 | 12/20/05 | 9/20/05 | 6/21/05 | 3/22/05 | 12/21/04 | 9/21/04 | ||||||||||||||||||||||||||||
6/30/06 | 3/30/06 | 12/30/05 | 9/30/05 | 6/30/05 | 4/29/05 | 1/31/05 | 10/29/04 | ||||||||||||||||||||||||||||
Fund | |||||||||||||||||||||||||||||||||||
PowerShares Dynamic MagniQuant Portfolio | NA | NA | NA | NA | NA | NA | NA | NA | |||||||||||||||||||||||||||
PowerShares Dynamic Market Portfolio | 0.04868 | 0.04452 | 0.13055 | 0.04739 | 0.10797 | 0.02900 | 0.08784 | 0.03096 | |||||||||||||||||||||||||||
PowerShares Dynamic OTC Portfolio | — | — | — | 0.05663 | — | — | — | — | |||||||||||||||||||||||||||
PowerShares FTSE RAFI US 1000 Portfolio | 0.14583 | 0.12172 | NA | NA | NA | NA | NA | NA | |||||||||||||||||||||||||||
PowerShares NASDAQ NextQ Portfolio | NA | NA | NA | NA | NA | NA | NA | NA |
15
Frequency Distribution of Discounts & Premiums
Since Inception through April 30, 2008
Closing Price Above NAV (bps) | |||||||||||||||||||||||||||||||||||||||
Ticker | Fund Name | Inception | Days | 0-24 | 25-49 | 50-99 | 100-149 | 150-199 | 200+ | ||||||||||||||||||||||||||||||
PIQ | PowerShares Dynamic MagniQuant Portfolio | 10/12/06 | 389 | 180 | 7 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PWC | PowerShares Dynamic Market Portfolio | 5/1/03 | 1145 | 656 | 63 | 11 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PWO | PowerShares Dynamic OTC Portfolio | 5/1/03 | 1145 | 577 | 32 | 11 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PRF | PowerShares FTSE RAFI US 1000 Portfolio | 12/19/05 | 585 | 298 | 7 | 1 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PNXQ | PowerShares NASDAQ NextQ Portfolio | 4/3/08 | 20 | 10 | 0 | 0 | 0 | 0 | 0 |
16
Closing Price Below NAV (bps) | |||||||||||||||||||||||||||
Ticker | -0-24 | -25-49 | -50-99 | -100-149 | -150-199 | -200+ | |||||||||||||||||||||
PIQ | 200 | 1 | 1 | 0 | 0 | 0 | |||||||||||||||||||||
PWC | 412 | 3 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
PWO | 510 | 13 | 2 | 0 | 0 | 0 | |||||||||||||||||||||
PRF | 268 | 5 | 6 | 0 | 0 | 0 | |||||||||||||||||||||
PNXQ | 8 | 2 | 0 | 0 | 0 | 0 |
17
Fees and Expenses
As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, you incur Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month (or shorter) period ended April 30, 2008.
Actual Expenses
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, 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 first line under the heading "Expenses Paid During the Six-Month Period" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds' actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Funds' 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 Funds 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 tables are meant to highlight your ongoing costs only, and do not reflect any transactional costs such as sales charges (loads). Therefore the second line in the table 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 transactional costs were included, your costs would have been higher.
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Dynamic MagniQuant Portfolio Actual | $ | 1,000.00 | $ | 890.72 | 0.65 | % | $ | 3.06 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | 0.65 | % | $ | 3.27 | |||||||||||
PowerShares Dynamic Market Portfolio Actual | $ | 1,000.00 | $ | 907.45 | 0.56 | % | $ | 2.66 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.08 | 0.56 | % | $ | 2.82 | |||||||||||
PowerShares Dynamic OTC Portfolio Actual | $ | 1,000.00 | $ | 817.30 | 0.58 | % | $ | 2.62 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.98 | 0.58 | % | $ | 2.92 | |||||||||||
PowerShares FTSE RAFI US 1000 Portfolio Actual | $ | 1,000.00 | $ | 890.56 | 0.64 | % | $ | 3.01 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.68 | 0.64 | % | $ | 3.22 |
(1) Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six months ended April 30, 2008. Expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 182 and then dividing the result by 366. Expense ratios for the most recent half-year may differ from expense ratios based on the one year data in the financial highlights.
18
Fees and Expenses (Continued)
Beginning Account Value April 3, 2008 (Fund Inception) | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Number of Days in the Period | Expenses Paid During Period (2) April 3, 2008 (Fund Inception) to April 30, 2008 | ||||||||||||||||
PowerShares NASDAQ NextQ Portfolio | |||||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,057.11 | 0.70 | % | $ | 0.53 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.38 | 0.70 | % | $ | 3.52 |
(2) Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the period ended April 30, 2008. Expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 28 and then dividing the result by 366. Hypothetical expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 182 and then dividing the result by 366.
19
Schedule of Investments
PowerShares Dynamic MagniQuant Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Consumer Discretionary—11.4% | |||||||||||
3,930 | Abercrombie & Fitch Co., Class A | $ | 292,038 | ||||||||
12,684 | AnnTaylor Stores Corp.* | 320,905 | |||||||||
4,964 | Apollo Group, Inc., Class A* | 252,668 | |||||||||
12,004 | DreamWorks Animation SKG, Inc., Class A* | 335,632 | |||||||||
7,294 | E.W. Scripps Co., Class A | 327,574 | |||||||||
9,468 | Fossil, Inc.* | 338,860 | |||||||||
15,105 | Gap (The), Inc. | 281,255 | |||||||||
7,696 | Gymboree (The) Corp.* | 332,621 | |||||||||
10,900 | Jakks Pacific, Inc.* | 256,041 | |||||||||
5,631 | McDonald's Corp. | 335,495 | |||||||||
7,028 | Meredith Corp. | 227,777 | |||||||||
15,819 | Movado Group, Inc. | 345,487 | |||||||||
563 | NVR, Inc.* | 345,401 | |||||||||
7,980 | Polaris Industries, Inc. | 371,468 | |||||||||
6,394 | Pre-Paid Legal Services, Inc.* | 279,674 | |||||||||
17,460 | RadioShack Corp. | 242,694 | |||||||||
8,737 | Scholastic Corp.* | 245,947 | |||||||||
6,103 | Snap-On, Inc. | 361,969 | |||||||||
1,957 | Strayer Education, Inc. | 363,394 | |||||||||
9,521 | TJX Cos., Inc. | 306,767 | |||||||||
7,665 | Viacom, Inc., Class B* | 294,643 | |||||||||
11,497 | Wolverine World Wide, Inc. | 330,424 | |||||||||
8,844 | Yum! Brands, Inc. | 359,774 | |||||||||
7,148,508 | |||||||||||
Consumer Staples—2.5% | |||||||||||
11,368 | Alberto-Culver Co. | 286,133 | |||||||||
9,654 | BJ's Wholesale Club, Inc.* | 368,010 | |||||||||
5,699 | Church & Dwight Co., Inc. | 323,817 | |||||||||
4,004 | Colgate-Palmolive Co. | 283,083 | |||||||||
4,674 | Kimberly-Clark Corp. | 299,089 | |||||||||
1,560,132 | |||||||||||
Energy—7.0% | |||||||||||
14,191 | Bois d'Arc Energy, Inc.* | 339,165 | |||||||||
3,516 | Chevron Corp. | 338,063 | |||||||||
5,781 | Cimarex Energy Co. | 360,156 | |||||||||
3,683 | ConocoPhillips | 317,290 | |||||||||
5,091 | ENSCO International, Inc. | 324,449 | |||||||||
3,502 | Exxon Mobil Corp. | 325,931 | |||||||||
5,377 | FMC Technologies, Inc.* | 361,335 | |||||||||
3,270 | Hess Corp. | 347,274 | |||||||||
3,936 | Noble Energy, Inc. | 342,432 | |||||||||
3,938 | Occidental Petroleum Corp. | 327,681 | |||||||||
3,524 | Schlumberger Ltd. | 354,338 | |||||||||
6,002 | Stone Energy Corp.* | 365,763 | |||||||||
7,709 | Trico Marine Services, Inc.* | 290,552 | |||||||||
4,394,429 | |||||||||||
Financials—24.3% | |||||||||||
5,417 | ACE Ltd. | 326,591 | |||||||||
4,882 | AFLAC, Inc. | 325,483 | |||||||||
6,383 | Allstate (The) Corp. | 321,448 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
11,777 | American Financial Group, Inc. | $ | 322,925 | ||||||||
7,322 | Aon Corp. | 332,346 | |||||||||
4,449 | Arch Capital Group Ltd.* | 314,322 | |||||||||
4,871 | Assurant, Inc. | 316,615 | |||||||||
7,232 | BancFirst Corp. | 316,255 | |||||||||
6,345 | Bank of Hawaii Corp. | 347,896 | |||||||||
15,536 | Charles Schwab (The) Corp. | 335,578 | |||||||||
5,986 | Chubb (The) Corp. | 317,078 | |||||||||
7,315 | Commerce Bancshares, Inc. | 318,203 | |||||||||
13,786 | Community Bank System, Inc. | 351,405 | |||||||||
10,102 | Delphi Financial Group, Inc., Class A | 274,976 | |||||||||
6,174 | Erie Indemnity Co., Class A | 329,815 | |||||||||
7,508 | Federated Investors, Inc., Class B | 251,368 | |||||||||
5,439 | GAMCO Investors, Inc., Class A | 250,248 | |||||||||
6,974 | Hanover Insurance Group (The), Inc. | 312,993 | |||||||||
9,073 | Harleysville Group, Inc. | 330,711 | |||||||||
12,663 | HCC Insurance Holdings, Inc. | 312,523 | |||||||||
17,530 | Horace Mann Educators Corp. | 296,608 | |||||||||
11,234 | IPC Holdings Ltd. | 327,022 | |||||||||
19,006 | Knight Capital Group, Inc., Class A* | 355,603 | |||||||||
7,282 | Loews Corp. | 306,645 | |||||||||
656 | Markel Corp.* | 284,966 | |||||||||
6,681 | Mercury General Corp. | 333,315 | |||||||||
5,567 | Navigators Group (The), Inc.* | 272,783 | |||||||||
8,421 | Odyssey Re Holdings Corp. | 301,303 | |||||||||
3,962 | PartnerRe Ltd. | 293,109 | |||||||||
8,982 | Philadelphia Consolidated Holding Co.* | 331,256 | |||||||||
5,730 | ProAssurance Corp.* | 303,289 | |||||||||
4,175 | Prudential Financial, Inc. | 316,089 | |||||||||
5,569 | Reinsurance Group of America, Inc. | 289,477 | |||||||||
5,833 | RLI Corp. | 279,984 | |||||||||
6,586 | Safeco Corp. | 439,551 | |||||||||
12,182 | SEI Investments Co. | 283,475 | |||||||||
12,823 | Selective Insurance Group | 273,386 | |||||||||
6,207 | StanCorp Financial Group, Inc. | 318,047 | |||||||||
3,879 | State Street Corp. | 279,831 | |||||||||
6,726 | SVB Financial Group* | 327,287 | |||||||||
16,649 | TD Ameritrade Holding Corp.* | 301,347 | |||||||||
5,056 | Torchmark Corp. | 327,325 | |||||||||
31,737 | TradeStation Group, Inc.* | 296,106 | |||||||||
4,520 | Transatlantic Holdings, Inc. | 293,122 | |||||||||
6,565 | Travelers (The) Cos., Inc. | 330,876 | |||||||||
16,240 | United America Indemnity Ltd., Class A* | 251,070 | |||||||||
8,870 | United Fire & Casualty Co. | 292,267 | |||||||||
10,583 | W.R. Berkley Corp. | 271,877 | |||||||||
9,275 | Willis Group Holdings Ltd. | 322,306 | |||||||||
15,208,101 | |||||||||||
Health Care—8.1% | |||||||||||
6,143 | Aetna, Inc. | 267,835 | |||||||||
7,303 | AmerisourceBergen Corp. | 296,137 | |||||||||
5,162 | Baxter International, Inc. | 321,696 | |||||||||
4,514 | Beckman Coulter, Inc. | 308,306 |
See Notes to Financial Statements.
20
Schedule of Investments (Continued)
PowerShares Dynamic MagniQuant Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
3,369 | Becton, Dickinson & Co. | $ | 301,189 | ||||||||
6,834 | CIGNA Corp. | 291,880 | |||||||||
5,874 | Coventry Health Care, Inc.* | 262,744 | |||||||||
5,155 | Express Scripts, Inc.* | 360,952 | |||||||||
5,093 | Henry Schein, Inc.* | 281,999 | |||||||||
4,459 | Humana, Inc.* | 213,096 | |||||||||
7,031 | Magellan Health Services, Inc.* | 271,326 | |||||||||
8,655 | Patterson Cos., Inc.* | 296,001 | |||||||||
4,616 | Pediatrix Medical Group, Inc.* | 313,980 | |||||||||
13,675 | Pfizer, Inc. | 275,004 | |||||||||
14,144 | Res-Care, Inc.* | 230,406 | |||||||||
4,455 | Techne Corp.* | 323,077 | |||||||||
6,555 | UnitedHealth Group, Inc. | 213,890 | |||||||||
6,382 | WellCare Health Plans, Inc.* | 279,404 | |||||||||
5,108,922 | |||||||||||
Industrials—15.3% | |||||||||||
4,697 | AGCO Corp.* | 282,431 | |||||||||
2,903 | Alliant Techsystems, Inc.* | 319,272 | |||||||||
11,023 | Applied Industrial Technologies, Inc. | 266,316 | |||||||||
4,552 | Brink's (The) Co. | 331,158 | |||||||||
10,638 | Columbus McKinnon Corp.* | 301,162 | |||||||||
7,266 | Cooper Industries Ltd., Class A | 308,006 | |||||||||
7,313 | Copart, Inc.* | 298,882 | |||||||||
3,779 | Eaton Corp. | 331,947 | |||||||||
2,188 | Fluor Corp. | 334,480 | |||||||||
8,255 | Gardner Denver, Inc.* | 383,444 | |||||||||
3,722 | General Dynamics Corp. | 336,543 | |||||||||
10,085 | GeoEye, Inc.* | 232,258 | |||||||||
5,144 | Goodrich Corp. | 350,564 | |||||||||
10,159 | HUB Group, Inc., Class A* | 332,098 | |||||||||
3,795 | Jacobs Engineering Group, Inc.* | 327,622 | |||||||||
9,141 | KBR, Inc. | 263,626 | |||||||||
2,866 | L-3 Communications Holdings, Inc. | 319,416 | |||||||||
6,569 | Landstar System, Inc. | 341,325 | |||||||||
4,538 | Lincoln Electric Holdings, Inc. | 346,249 | |||||||||
2,952 | Lockheed Martin Corp. | 313,030 | |||||||||
5,373 | Manpower, Inc. | 360,689 | |||||||||
5,834 | McDermott International, Inc.* | 312,586 | |||||||||
3,876 | Northrop Grumman Corp. | 285,157 | |||||||||
9,980 | Republic Services, Inc. | 317,264 | |||||||||
20,558 | Rush Enterprises, Inc., Class A* | 331,395 | |||||||||
5,289 | Ryder System, Inc. | 362,138 | |||||||||
2,978 | SPX Corp. | 366,294 | |||||||||
7,564 | URS Corp.* | 305,132 | |||||||||
8,327 | Waste Industries USA, Inc. | 314,344 | |||||||||
5,743 | Watson Wyatt Worldwide, Inc., Class A | 336,655 | |||||||||
9,611,483 | |||||||||||
Information Technology—23.2% | |||||||||||
11,180 | Activision, Inc.* | 302,419 | |||||||||
23,971 | Acxiom Corp. | 283,577 | |||||||||
9,054 | Adobe Systems, Inc.* | 337,624 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
26,018 | Amkor Technology, Inc.* | $ | 248,472 | ||||||||
8,241 | Amphenol Corp., Class A | 380,570 | |||||||||
12,528 | Ansoft Corp.* | 415,429 | |||||||||
8,153 | Ansys, Inc.* | 327,995 | |||||||||
2,437 | Apple, Inc.* | 423,917 | |||||||||
15,893 | Applied Materials, Inc. | 296,563 | |||||||||
9,438 | BMC Software, Inc.* | 328,065 | |||||||||
13,316 | CA, Inc. | 294,816 | |||||||||
28,688 | Cadence Design Systems, Inc.* | 319,297 | |||||||||
12,502 | Cisco Systems, Inc.* | 320,551 | |||||||||
7,012 | Computer Sciences Corp.* | 305,653 | |||||||||
7,023 | Comtech Telecommunications Corp.* | 272,001 | |||||||||
4,336 | DST Systems, Inc.* | 259,466 | |||||||||
7,680 | Global Payments, Inc. | 339,917 | |||||||||
6,240 | Harris Corp. | 337,147 | |||||||||
7,721 | Hewitt Associates, Inc., Class A* | 316,561 | |||||||||
6,378 | Hewlett-Packard Co. | 295,620 | |||||||||
15,272 | Intel Corp. | 339,955 | |||||||||
2,676 | International Business Machines Corp. | 322,993 | |||||||||
9,224 | Lexmark International, Inc., Class A* | 289,541 | |||||||||
3,994 | MEMC Electronic Materials, Inc.* | 251,502 | |||||||||
9,509 | Micros Systems, Inc.* | 338,996 | |||||||||
11,193 | Microsoft Corp. | 319,224 | |||||||||
18,498 | National Semiconductor Corp. | 377,174 | |||||||||
13,749 | NCR Corp.* | 338,638 | |||||||||
14,092 | NetApp, Inc.* | 341,026 | |||||||||
13,798 | Novellus Systems, Inc.* | 301,624 | |||||||||
16,206 | Oracle Corp.* | 337,895 | |||||||||
16,154 | Plantronics, Inc. | 402,397 | |||||||||
19,222 | QLogic Corp.* | 306,783 | |||||||||
7,739 | Rofin-Sinar Technologies, Inc.* | 294,701 | |||||||||
15,985 | SAIC, Inc.* | 303,715 | |||||||||
23,914 | Semtech Corp.* | 388,364 | |||||||||
10,747 | Standard Microsystems Corp.* | 318,649 | |||||||||
11,445 | Sybase, Inc.* | 336,712 | |||||||||
13,127 | Synopsys, Inc.* | 303,365 | |||||||||
25,410 | Teradyne, Inc.* | 337,699 | |||||||||
10,169 | Texas Instruments, Inc. | 296,528 | |||||||||
15,158 | Verigy Ltd. (Singapore)* | 323,926 | |||||||||
9,870 | Western Digital Corp.* | 286,131 | |||||||||
14,648 | Western Union (The) Co. | 336,904 | |||||||||
9,144 | Zebra Technologies Corp., Class A* | 336,042 | |||||||||
14,536,144 | |||||||||||
Materials—3.7% | |||||||||||
5,790 | AK Steel Holding Corp. | 363,496 | |||||||||
7,832 | Celanese Corp., Series A | 350,482 | |||||||||
5,226 | Lubrizol (The) Corp. | 304,780 | |||||||||
5,033 | OM Group, Inc.* | 275,607 | |||||||||
5,397 | Owens-Illinois, Inc.* | 297,645 | |||||||||
11,356 | Rock-Tenn Co., Class A | 385,309 | |||||||||
5,537 | Sigma-Aldrich Corp. | 315,720 | |||||||||
2,293,039 |
See Notes to Financial Statements.
21
Schedule of Investments (Continued)
PowerShares Dynamic MagniQuant Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Telecommunication Services—0.8% | |||||||||||
8,419 | CenturyTel, Inc. | $ | 273,196 | ||||||||
6,496 | Telephone & Data Systems, Inc. | 248,797 | |||||||||
521,993 | |||||||||||
Utilities—3.7% | |||||||||||
7,628 | Dominion Resources, Inc. | 330,979 | |||||||||
17,370 | Duke Energy Corp. | 318,045 | |||||||||
5,078 | Energen Corp. | 346,522 | |||||||||
4,508 | FirstEnergy Corp. | 340,985 | |||||||||
8,090 | PG&E Corp. | 323,600 | |||||||||
6,714 | PPL Corp. | 322,406 | |||||||||
13,363 | Reliant Energy, Inc.* | 343,964 | |||||||||
2,326,501 | |||||||||||
Total Common Stocks (Cost $63,074,152) | 62,709,252 | ||||||||||
Money Market Fund—0.4% | |||||||||||
267,681 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $267,681) | 267,681 | |||||||||
Total Investments (Cost $63,341,833)—100.4% | 62,976,933 | ||||||||||
Liabilities in excess of other assets—(0.4%) | (276,535 | ) | |||||||||
Net Assets—100.0% | $ | 62,700,398 |
* Non-income producing security.
See Notes to Financial Statements.
22
Schedule of Investments
PowerShares Dynamic Market Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Consumer Discretionary—10.5% | |||||||||||
149,573 | Abercrombie & Fitch Co., Class A | $ | 11,114,770 | ||||||||
82,763 | AnnTaylor Stores Corp.* | 2,093,904 | |||||||||
188,929 | Apollo Group, Inc., Class A* | 9,616,486 | |||||||||
78,330 | DreamWorks Animation SKG, Inc., Class A* | 2,190,107 | |||||||||
61,778 | Fossil, Inc.* | 2,211,035 | |||||||||
574,933 | Gap (The), Inc. | 10,705,252 | |||||||||
50,214 | Gymboree (The) Corp.* | 2,170,249 | |||||||||
70,720 | JAKKS Pacific, Inc.* | 1,661,213 | |||||||||
214,311 | McDonald's Corp. | 12,768,649 | |||||||||
103,217 | Movado Group, Inc. | 2,254,259 | |||||||||
41,720 | Pre-Paid Legal Services, Inc.* | 1,824,833 | |||||||||
39,822 | Snap-On, Inc. | 2,361,843 | |||||||||
12,768 | Strayer Education, Inc. | 2,370,890 | |||||||||
75,018 | Wolverine World Wide, Inc. | 2,156,017 | |||||||||
65,499,507 | |||||||||||
Consumer Staples—9.2% | |||||||||||
107,841 | Alberto-Culver Co. | 2,714,358 | |||||||||
91,577 | BJ's Wholesale Club, Inc.* | 3,490,915 | |||||||||
54,062 | Church & Dwight Co., Inc. | 3,071,803 | |||||||||
52,846 | Coca-Cola Bottling Co. Consolidated | 3,023,848 | |||||||||
265,886 | Colgate-Palmolive Co. | 18,798,140 | |||||||||
70,733 | Hormel Foods Corp. | 2,787,588 | |||||||||
310,388 | Kimberly-Clark Corp. | 19,861,728 | |||||||||
50,783 | Universal Corp. | 3,259,761 | |||||||||
57,008,141 | |||||||||||
Energy—12.4% | |||||||||||
247,708 | Bois d'Arc Energy, Inc.* | 5,920,221 | |||||||||
100,917 | Cimarex Energy Co. | 6,287,129 | |||||||||
285,238 | Exxon Mobil Corp. | 26,547,101 | |||||||||
93,863 | FMC Technologies, Inc.* | 6,307,594 | |||||||||
320,780 | Occidental Petroleum Corp. | 26,692,103 | |||||||||
134,571 | Trico Marine Services, Inc.* | 5,071,981 | |||||||||
76,826,129 | |||||||||||
Financials—17.7% | |||||||||||
202,917 | AFLAC, Inc. | 13,528,477 | |||||||||
39,627 | Arch Capital Group Ltd.* | 2,799,648 | |||||||||
43,384 | Assurant, Inc. | 2,819,960 | |||||||||
248,804 | Chubb (The) Corp. | 13,179,148 | |||||||||
62,112 | Hanover Insurance Group (The), Inc. | 2,787,587 | |||||||||
112,790 | HCC Insurance Holdings, Inc. | 2,783,657 | |||||||||
302,677 | Loews Corp. | 12,745,728 | |||||||||
5,838 | Markel Corp.* | 2,536,027 | |||||||||
49,585 | Navigators Group (The), Inc.* | 2,429,665 | |||||||||
35,293 | PartnerRe Ltd. | 2,610,976 | |||||||||
51,956 | RLI Corp. | 2,493,888 | |||||||||
58,664 | Safeco Corp. | 3,915,235 | |||||||||
161,221 | State Street Corp. | 11,630,483 | |||||||||
692,024 | TD Ameritrade Holding Corp.* | 12,525,634 | |||||||||
40,264 | Transatlantic Holdings, Inc. | 2,611,120 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
272,875 | Travelers (The) Cos., Inc. | $ | 13,752,901 | ||||||||
79,001 | United Fire & Casualty Co. | 2,603,083 | |||||||||
94,258 | W.R. Berkley Corp. | 2,421,488 | |||||||||
110,174,705 | |||||||||||
Health Care—11.2% | |||||||||||
46,655 | Amedisys, Inc.* | 2,416,729 | |||||||||
29,570 | Beckman Coulter, Inc. | 2,019,631 | |||||||||
141,643 | Becton, Dickinson & Co. | 12,662,884 | |||||||||
216,706 | Express Scripts, Inc.* | 15,173,754 | |||||||||
33,366 | Henry Schein, Inc.* | 1,847,475 | |||||||||
187,437 | Humana, Inc.* | 8,957,614 | |||||||||
38,841 | Kinetic Concepts, Inc.* | 1,540,434 | |||||||||
46,066 | Magellan Health Services, Inc.* | 1,777,687 | |||||||||
55,521 | OSI Pharmaceuticals, Inc.* | 1,923,803 | |||||||||
56,703 | Patterson Cos., Inc.* | 1,939,243 | |||||||||
30,236 | Pediatrix Medical Group, Inc.* | 2,056,653 | |||||||||
574,842 | Pfizer, Inc. | 11,560,073 | |||||||||
92,662 | Res-Care, Inc.* | 1,509,464 | |||||||||
29,187 | Techne Corp.* | 2,116,641 | |||||||||
41,808 | WellCare Health Plans, Inc.* | 1,830,354 | |||||||||
69,332,439 | |||||||||||
Industrials—12.3% | |||||||||||
25,717 | Alliant Techsystems, Inc.* | 2,828,356 | |||||||||
40,326 | Brink's (The) Co. | 2,933,717 | |||||||||
64,784 | Copart, Inc.* | 2,647,722 | |||||||||
73,123 | Gardner Denver, Inc.* | 3,396,563 | |||||||||
283,530 | Goodrich Corp. | 19,322,569 | |||||||||
89,994 | HUB Group, Inc., Class A* | 2,941,904 | |||||||||
40,199 | Lincoln Electric Holdings, Inc. | 3,067,184 | |||||||||
162,728 | Lockheed Martin Corp. | 17,255,676 | |||||||||
47,600 | Manpower, Inc. | 3,195,388 | |||||||||
213,629 | Northrop Grumman Corp. | 15,716,686 | |||||||||
46,849 | Ryder System, Inc. | 3,207,751 | |||||||||
76,513,516 | |||||||||||
Information Technology—15.8% | |||||||||||
219,986 | Amkor Technology, Inc.* | 2,100,866 | |||||||||
68,934 | Ansys, Inc.* | 2,773,215 | |||||||||
409,651 | BMC Software, Inc.* | 14,239,469 | |||||||||
242,564 | Cadence Design Systems, Inc.* | 2,699,737 | |||||||||
65,281 | Hewitt Associates, Inc., Class A* | 2,676,521 | |||||||||
276,819 | Hewlett-Packard Co. | 12,830,561 | |||||||||
662,834 | Intel Corp. | 14,754,685 | |||||||||
77,990 | Lexmark International, Inc., Class A* | 2,448,106 | |||||||||
485,803 | Microsoft Corp. | 13,855,102 | |||||||||
116,668 | Novellus Systems, Inc.* | 2,550,362 | |||||||||
136,586 | Plantronics, Inc. | 3,402,357 | |||||||||
162,526 | QLogic Corp.* | 2,593,915 | |||||||||
96,770 | Sybase, Inc.* | 2,846,973 | |||||||||
110,987 | Synopsys, Inc.* | 2,564,910 | |||||||||
214,848 | Teradyne, Inc.* | 2,855,330 | |||||||||
441,372 | Texas Instruments, Inc. | 12,870,408 | |||||||||
98,062,517 |
See Notes to Financial Statements.
23
Schedule of Investments (Continued)
PowerShares Dynamic Market Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Materials—3.9% | |||||||||||
47,822 | AK Steel Holding Corp. | $ | 3,002,265 | ||||||||
64,686 | Celanese Corp., Series A | 2,894,699 | |||||||||
320,141 | Sigma-Aldrich Corp. | 18,254,439 | |||||||||
24,151,403 | |||||||||||
Telecommunication Services—3.0% | |||||||||||
52,585 | CenturyTel, Inc. | 1,706,383 | |||||||||
1,233,496 | Qwest Communications International, Inc. | 6,364,839 | |||||||||
40,578 | Telephone & Data Systems, Inc. | 1,554,137 | |||||||||
30,207 | United States Cellular Corp.* | 1,665,916 | |||||||||
184,255 | Verizon Communications, Inc. | 7,090,133 | |||||||||
18,381,408 | |||||||||||
Utilities—4.0% | |||||||||||
394,685 | Dominion Resources, Inc. | 17,125,382 | |||||||||
56,300 | Energen Corp. | 3,841,912 | |||||||||
148,154 | Reliant Energy, Inc.* | 3,813,484 | |||||||||
24,780,778 | |||||||||||
Total Common Stocks (Cost $620,563,760) | 620,730,543 | ||||||||||
Money Market Fund—0.1% | |||||||||||
757,518 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $757,518) | 757,518 | |||||||||
Total Investments (Cost $621,321,278)—100.1% | 621,488,061 | ||||||||||
Liabilities in excess of other assets—(0.1%) | (785,492 | ) | |||||||||
Net Assets—100.0% | $ | 620,702,569 |
* Non-income producing security.
See Notes to Financial Statements.
24
Schedule of Investments
PowerShares Dynamic OTC Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.9% | |||||||||||
Consumer Discretionary—12.4% | |||||||||||
34,432 | Apollo Group, Inc., Class A* | $ | 1,752,589 | ||||||||
23,260 | Charlotte Russe Holding, Inc.* | 369,369 | |||||||||
84,368 | DIRECTV Group (The), Inc.* | 2,078,827 | |||||||||
71,279 | DISH Network Corp., Class A* | 2,126,965 | |||||||||
14,073 | Fossil, Inc.* | 503,673 | |||||||||
95,544 | Gemstar-TV Guide International, Inc.* | 385,042 | |||||||||
11,440 | Gymboree (The) Corp.* | 494,437 | |||||||||
16,202 | JAKKS Pacific, Inc.* | 380,585 | |||||||||
14,341 | NetFlix, Inc.* | 458,625 | |||||||||
12,988 | Scholastic Corp.* | 365,612 | |||||||||
2,909 | Strayer Education, Inc. | 540,172 | |||||||||
73,434 | Urban Outfitters, Inc.* | 2,515,114 | |||||||||
11,971,010 | |||||||||||
Consumer Staples—1.7% | |||||||||||
22,215 | Casey's General Stores, Inc. | 491,618 | |||||||||
31,290 | Hansen Natural Corp.* | 1,107,353 | |||||||||
1,598,971 | |||||||||||
Energy—1.5% | |||||||||||
37,774 | Patterson-UTI Energy, Inc. | 1,055,406 | |||||||||
9,722 | Trico Marine Services, Inc.* | 366,422 | |||||||||
1,421,828 | |||||||||||
Financials—8.5% | |||||||||||
5,424 | American Physicians Capital, Inc. | 251,402 | |||||||||
20,396 | Arch Capital Group Ltd.* | 1,440,977 | |||||||||
5,683 | BancFirst Corp. | 248,518 | |||||||||
28,303 | Erie Indemnity Co., Class A | 1,511,946 | |||||||||
7,131 | Harleysville Group, Inc. | 259,925 | |||||||||
8,828 | IPC Holdings Ltd. | 256,983 | |||||||||
4,375 | Navigators Group (The), Inc.* | 214,375 | |||||||||
41,176 | Philadelphia Consolidated Holding Co.* | 1,518,571 | |||||||||
10,078 | Selective Insurance Group | 214,863 | |||||||||
5,286 | SVB Financial Group* | 257,217 | |||||||||
76,322 | TD Ameritrade Holding Corp.* | 1,381,428 | |||||||||
24,942 | TradeStation Group, Inc.* | 232,709 | |||||||||
12,762 | United America Indemnity Ltd., Class A* | 197,301 | |||||||||
6,971 | United Fire & Casualty Co. | 229,694 | |||||||||
8,215,909 | |||||||||||
Health Care—12.9% | |||||||||||
9,980 | Air Methods Corp.* | 400,198 | |||||||||
9,595 | Amedisys, Inc.* | 497,021 | |||||||||
15,223 | CONMED Corp.* | 388,491 | |||||||||
36,458 | Express Scripts, Inc.* | 2,552,789 | |||||||||
36,019 | Henry Schein, Inc.* | 1,994,372 | |||||||||
9,473 | Magellan Health Services, Inc.* | 365,563 | |||||||||
14,319 | Martek Biosciences Corp.* | 504,888 | |||||||||
11,976 | Meridian Bioscience, Inc. | 322,514 | |||||||||
25,894 | Merit Medical Systems, Inc.* | 380,901 | |||||||||
61,211 | Patterson Cos., Inc.* | 2,093,416 | |||||||||
14,235 | PharmaNet Development Group, Inc.* | 339,647 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
19,053 | Res-Care, Inc.* | $ | 310,373 | ||||||||
31,505 | Techne Corp.* | 2,284,743 | |||||||||
12,434,916 | |||||||||||
Industrials—6.4% | |||||||||||
12,316 | Columbus McKinnon Corp.* | 348,666 | |||||||||
49,390 | Copart, Inc.* | 2,018,569 | |||||||||
11,677 | GeoEye, Inc.* | 268,921 | |||||||||
11,762 | HUB Group, Inc., Class A* | 384,500 | |||||||||
30,646 | Lincoln Electric Holdings, Inc. | 2,338,290 | |||||||||
23,800 | Rush Enterprises, Inc., Class A* | 383,656 | |||||||||
9,639 | Waste Industries USA, Inc. | 363,872 | |||||||||
6,106,474 | |||||||||||
Information Technology—54.4% | |||||||||||
103,314 | Activision, Inc.* | 2,794,644 | |||||||||
33,504 | Acxiom Corp. | 396,352 | |||||||||
83,664 | Adobe Systems, Inc.* | 3,119,831 | |||||||||
23,118 | ADTRAN, Inc. | 546,972 | |||||||||
36,367 | Amkor Technology, Inc.* | 347,305 | |||||||||
17,509 | Ansoft Corp.* | 580,598 | |||||||||
75,335 | Ansys, Inc.* | 3,030,727 | |||||||||
22,519 | Apple, Inc.* | 3,917,181 | |||||||||
12,715 | Cabot Microelectronics Corp.* | 432,946 | |||||||||
265,093 | Cadence Design Systems, Inc.* | 2,950,485 | |||||||||
115,524 | Cisco Systems, Inc.* | 2,962,035 | |||||||||
9,816 | Comtech Telecommunications Corp.* | 380,174 | |||||||||
37,519 | CSG Systems International, Inc.* | 453,980 | |||||||||
58,900 | EarthLink, Inc.* | 537,757 | |||||||||
14,792 | EMS Technologies, Inc.* | 382,521 | |||||||||
12,862 | Hittite Microwave Corp.* | 510,621 | |||||||||
24,389 | Informatica Corp.* | 389,248 | |||||||||
141,117 | Intel Corp. | 3,141,265 | |||||||||
18,098 | Jack Henry & Associates, Inc. | 475,615 | |||||||||
19,304 | Manhattan Associates, Inc.* | 502,097 | |||||||||
9,660 | ManTech International Corp., Class A* | 461,458 | |||||||||
57,937 | Micrel, Inc. | 568,941 | |||||||||
103,427 | Microsoft Corp. | 2,949,738 | |||||||||
130,218 | NetApp, Inc.* | 3,151,277 | |||||||||
127,504 | Novellus Systems, Inc.* | 2,787,237 | |||||||||
149,749 | Oracle Corp.* | 3,122,267 | |||||||||
17,192 | Plexus Corp.* | 414,155 | |||||||||
16,192 | Power Integrations, Inc.* | 504,705 | |||||||||
14,920 | Progress Software Corp.* | 451,032 | |||||||||
26,868 | QLogic Corp.* | 428,813 | |||||||||
29,926 | Quest Software, Inc.* | 398,614 | |||||||||
29,821 | Radiant Systems, Inc.* | 402,285 | |||||||||
10,817 | Rofin-Sinar Technologies, Inc.* | 411,911 | |||||||||
12,536 | ScanSource, Inc.* | 313,024 | |||||||||
33,425 | Semtech Corp.* | 542,822 | |||||||||
13,759 | Silicon Laboratories, Inc.* | 464,641 | |||||||||
64,133 | Smart Modular Technologies (WWH), Inc.* | 386,722 | |||||||||
9,446 | Sohu.com, Inc.* | 653,002 |
See Notes to Financial Statements.
25
Schedule of Investments (Continued)
PowerShares Dynamic OTC Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
51,122 | SonicWALL, Inc.* | $ | 393,128 | ||||||||
11,197 | SPSS, Inc.* | 472,961 | |||||||||
15,021 | Standard Microsystems Corp.* | 445,373 | |||||||||
121,297 | Synopsys, Inc.* | 2,803,174 | |||||||||
90,222 | TriQuint Semiconductor, Inc.* | 594,563 | |||||||||
21,186 | Verigy Ltd. (Singapore)* | 452,745 | |||||||||
33,665 | Vignette Corp.* | 388,831 | |||||||||
12,781 | Zebra Technologies Corp., Class A* | 469,702 | |||||||||
52,285,475 | |||||||||||
Materials—0.8% | |||||||||||
11,518 | Innospec, Inc. | 234,852 | |||||||||
9,152 | Sigma-Aldrich Corp. | 521,847 | |||||||||
756,699 | |||||||||||
Telecommunication Services—1.3% | |||||||||||
350,298 | Level 3 Communications, Inc.* | 1,040,385 | |||||||||
31,884 | USA Mobility, Inc.* | 227,652 | |||||||||
1,268,037 | |||||||||||
Total Investments (Cost $96,973,514)—99.9% | 96,059,319 | ||||||||||
Other assets less liabilities—0.1% | 127,229 | ||||||||||
Net Assets—100.0% | $ | 96,186,548 |
* Non-income producing security.
See Notes to Financial Statements.
26
Schedule of Investments
PowerShares FTSE RAFI US 1000 Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests—100.0% | |||||||||||
Consumer Discretionary—12.7% | |||||||||||
2,847 | Abercrombie & Fitch Co., Class A | $ | 211,561 | ||||||||
2,940 | Advance Auto Parts, Inc. | 101,959 | |||||||||
4,062 | Amazon.com, Inc.* | 319,395 | |||||||||
6,888 | American Axle & Manufacturing Holdings, Inc. | 138,724 | |||||||||
6,411 | American Eagle Outfitters, Inc. | 117,770 | |||||||||
6,292 | American Greetings Corp., Class A | 112,627 | |||||||||
6,413 | AnnTaylor Stores Corp.* | 162,249 | |||||||||
3,631 | Apollo Group, Inc., Class A* | 184,818 | |||||||||
24,760 | ArvinMeritor, Inc. | 369,914 | |||||||||
12,229 | Asbury Automotive Group, Inc. | 203,613 | |||||||||
8,179 | Autoliv, Inc. | 500,882 | |||||||||
44,961 | AutoNation, Inc.* | 719,826 | |||||||||
2,702 | AutoZone, Inc.* | 326,267 | |||||||||
5,770 | Barnes & Noble, Inc. | 186,256 | |||||||||
32,590 | Beazer Homes USA, Inc. | 360,771 | |||||||||
15,849 | Bed Bath & Beyond, Inc.* | 515,093 | |||||||||
16,600 | Belo Corp., Class A | 167,660 | |||||||||
29,985 | Best Buy Co., Inc. | 1,289,955 | |||||||||
13,667 | Big Lots, Inc.* | 369,419 | |||||||||
4,730 | Black & Decker (The) Corp. | 310,430 | |||||||||
90,134 | Blockbuster, Inc., Class A* | 263,191 | |||||||||
53,353 | Blockbuster, Inc., Class B* | 124,312 | |||||||||
18,720 | Borders Group, Inc. | 117,936 | |||||||||
6,006 | BorgWarner, Inc. | 295,195 | |||||||||
5,836 | Boyd Gaming Corp. | 109,425 | |||||||||
10,785 | Brinker International, Inc. | 244,712 | |||||||||
4,349 | Brookfield Homes Corp. | 68,453 | |||||||||
18,994 | Brunswick Corp. | 316,820 | |||||||||
5,708 | Burger King Holdings, Inc. | 159,253 | |||||||||
26,188 | Cablevision Systems Corp., Class A* | 602,324 | |||||||||
10,299 | Career Education Corp.* | 207,525 | |||||||||
14,663 | CarMax, Inc.* | 304,257 | |||||||||
34,797 | Carnival Corp. | 1,397,795 | |||||||||
79,655 | CBS Corp., Class B | 1,837,641 | |||||||||
28,548 | Centex Corp. | 594,369 | |||||||||
28,875 | Charming Shoppes, Inc.* | 148,995 | |||||||||
221,422 | Charter Communications, Inc., Class A* | 236,922 | |||||||||
12,788 | Chico's FAS, Inc.* | 90,411 | |||||||||
82,966 | Circuit City Stores, Inc. | 393,259 | |||||||||
32,225 | Clear Channel Communications, Inc. | 971,584 | |||||||||
12,583 | Clear Channel Outdoor Holdings, Inc., Class A* | 239,329 | |||||||||
8,547 | Coach, Inc.* | 304,017 | |||||||||
10,162 | Collective Brands, Inc.* | 125,704 | |||||||||
131,932 | Comcast Corp., Class A | 2,711,203 | |||||||||
68,067 | Comcast Corp., Special Class A | 1,377,676 | |||||||||
8,203 | Cooper Tire & Rubber Co. | 107,787 | |||||||||
4,729 | Core-Mark Holding Co., Inc.* | 135,533 | |||||||||
59,585 | D.R. Horton, Inc. | 922,972 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
9,823 | Darden Restaurants, Inc. | $ | 349,502 | ||||||||
3,395 | Dick's Sporting Goods, Inc.* | 97,097 | |||||||||
22,210 | Dillard's, Inc., Class A | 453,084 | |||||||||
29,208 | DIRECTV Group (The), Inc.* | 719,685 | |||||||||
11,797 | Discovery Holding Co., Class A* | 273,219 | |||||||||
17,063 | DISH Network Corp., Class A* | 509,160 | |||||||||
8,866 | Dollar Tree, Inc.* | 280,166 | |||||||||
5,324 | E.W. Scripps Co., Class A | 239,101 | |||||||||
52,529 | Eastman Kodak Co. | 939,744 | |||||||||
11,808 | Exide Technologies* | 172,279 | |||||||||
21,607 | Expedia, Inc.* | 545,793 | |||||||||
16,412 | Family Dollar Stores, Inc. | 351,217 | |||||||||
25,918 | Foot Locker, Inc. | 327,863 | |||||||||
980,877 | Ford Motor Co.* | 8,102,043 | |||||||||
11,014 | Fortune Brands, Inc. | 744,767 | |||||||||
10,735 | Furniture Brands International, Inc. | 145,459 | |||||||||
4,781 | GameStop Corp., Class A* | 263,146 | |||||||||
36,002 | Gannett Co., Inc. | 1,030,377 | |||||||||
37,041 | Gap (The), Inc. | 689,703 | |||||||||
2,414 | Garmin Ltd. | 98,733 | |||||||||
305,035 | General Motors Corp. | 7,076,811 | |||||||||
15,733 | Genuine Parts Co. | 668,023 | |||||||||
2,917 | Getty Images, Inc.* | 95,240 | |||||||||
22,574 | Goodyear Tire & Rubber (The) Co.* | 604,532 | |||||||||
6,907 | Group 1 Automotive, Inc. | 184,279 | |||||||||
24,982 | H&R Block, Inc. | 546,356 | |||||||||
14,493 | Hanesbrands, Inc.* | 507,545 | |||||||||
15,099 | Harley-Davidson, Inc. | 577,537 | |||||||||
4,245 | Harman International Industries, Inc. | 173,493 | |||||||||
8,743 | Hasbro, Inc. | 310,901 | |||||||||
2,267 | Hearst-Argyle Television, Inc. | 46,972 | |||||||||
4,263 | Hillenbrand, Inc.* | 81,168 | |||||||||
182,454 | Home Depot (The), Inc. | 5,254,674 | |||||||||
28,684 | Hovnanian Enterprises, Inc., Class A* | 339,045 | |||||||||
38,845 | IAC/InterActiveCorp* | 808,364 | |||||||||
8,345 | International Game Technology | 289,905 | |||||||||
35,398 | Interpublic Group of Cos., Inc.* | 320,352 | |||||||||
21,225 | J. C. Penney Co., Inc. | 902,063 | |||||||||
5,189 | Jack in the Box, Inc.* | 138,806 | |||||||||
6,410 | Jarden Corp.* | 136,661 | |||||||||
45,866 | Johnson Controls, Inc. | 1,617,235 | |||||||||
18,113 | Jones Apparel Group, Inc. | 286,729 | |||||||||
18,743 | KB Home | 421,718 | |||||||||
21,434 | Kohl's Corp.* | 1,047,051 | |||||||||
4,662 | Lamar Advertising Co., Class A* | 184,335 | |||||||||
765 | Las Vegas Sands Corp.* | 58,308 | |||||||||
20,861 | Lear Corp.* | 595,999 | |||||||||
12,235 | Lee Enterprises, Inc. | 94,577 | |||||||||
23,788 | Leggett & Platt, Inc. | 394,881 | |||||||||
31,937 | Lennar Corp., Class A | 588,280 | |||||||||
11,574 | Liberty Global, Inc., Series A* | 409,604 |
See Notes to Financial Statements.
27
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1000 Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
10,706 | Liberty Global, Inc., Series C* | $ | 355,439 | ||||||||
23,887 | Liberty Media Corp.-Entertainment, Class A* | 619,868 | |||||||||
67,485 | Liberty Media Corp. Interactive, Series A* | 1,021,048 | |||||||||
53,863 | Limited Brands, Inc. | 997,543 | |||||||||
13,038 | Live Nation, Inc.* | 179,794 | |||||||||
16,432 | Liz Claiborne, Inc. | 290,682 | |||||||||
94,833 | Lowe's Cos., Inc. | 2,388,843 | |||||||||
4,947 | M.D.C. Holdings, Inc. | 215,590 | |||||||||
56,245 | Macy's, Inc. | 1,422,436 | |||||||||
14,800 | Marriott International, Inc., Class A | 507,640 | |||||||||
25,117 | Mattel, Inc. | 470,944 | |||||||||
21,841 | McClatchy Co., Class A | 229,331 | |||||||||
45,799 | McDonald's Corp. | 2,728,704 | |||||||||
17,998 | McGraw-Hill (The) Cos., Inc. | 737,738 | |||||||||
2,013 | Meredith Corp. | 65,241 | |||||||||
8,347 | Meritage Homes Corp.* | 158,343 | |||||||||
5,239 | MGM MIRAGE* | 267,975 | |||||||||
7,398 | Mohawk Industries, Inc.* | 563,654 | |||||||||
15,559 | New York Times (The) Co., Class A | 303,401 | |||||||||
26,576 | Newell Rubbermaid, Inc. | 545,605 | |||||||||
140,658 | News Corp., Class A | 2,517,778 | |||||||||
30,252 | News Corp., Class B | 559,662 | |||||||||
14,783 | NIKE, Inc., Class B | 987,504 | |||||||||
11,411 | Nordstrom, Inc. | 402,352 | |||||||||
646 | NVR, Inc.* | 396,321 | |||||||||
61,099 | Office Depot, Inc.* | 774,735 | |||||||||
18,755 | OfficeMax, Inc. | 342,654 | |||||||||
17,223 | Omnicom Group, Inc. | 822,226 | |||||||||
7,227 | O'Reilly Automotive, Inc.* | 208,643 | |||||||||
3,149 | Penn National Gaming, Inc.* | 134,525 | |||||||||
9,268 | Penske Automotive Group, Inc. | 193,979 | |||||||||
8,169 | PetSmart, Inc. | 182,822 | |||||||||
3,068 | Polaris Industries, Inc. | 142,815 | |||||||||
4,016 | Polo Ralph Lauren Corp. | 249,434 | |||||||||
54,378 | Pulte Homes, Inc. | 709,089 | |||||||||
13,070 | Quiksilver, Inc.* | 127,171 | |||||||||
14,462 | RadioShack Corp. | 201,022 | |||||||||
28,854 | Regal Entertainment Group, Class A | 547,072 | |||||||||
5,087 | Regis Corp. | 148,540 | |||||||||
16,187 | Rent-A-Center, Inc.* | 348,506 | |||||||||
18,566 | RH Donnelley Corp.* | 88,931 | |||||||||
8,177 | Ross Stores, Inc. | 273,848 | |||||||||
12,628 | Royal Caribbean Cruises Ltd. | 402,833 | |||||||||
8,491 | Ryland Group, Inc. | 271,542 | |||||||||
32,231 | Saks, Inc.* | 419,325 | |||||||||
3,672 | Scholastic Corp.* | 103,367 | |||||||||
14,746 | Sears Holdings Corp.* | 1,454,103 | |||||||||
14,792 | Service Corp. International | 164,339 | |||||||||
8,424 | Sherwin-Williams (The) Co. | 466,016 | |||||||||
3,784 | Snap-On, Inc. | 224,429 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
14,473 | Sonic Automotive, Inc., Class A | $ | 293,657 | ||||||||
48,848 | Standard-Pacific Corp. | 247,171 | |||||||||
6,072 | Stanley Works (The) | 292,913 | |||||||||
36,091 | Staples, Inc. | 783,175 | |||||||||
28,557 | Starbucks Corp.* | 463,480 | |||||||||
11,011 | Starwood Hotels & Resorts Worldwide, Inc. | 574,884 | |||||||||
6,251 | Talbots (The), Inc. | 50,196 | |||||||||
52,604 | Target Corp. | 2,794,851 | |||||||||
8,460 | Tenneco, Inc.* | 216,407 | |||||||||
3,210 | Thor Industries, Inc. | 97,327 | |||||||||
5,601 | Tiffany & Co. | 243,868 | |||||||||
5,684 | Timberland (The) Co., Class A* | 82,986 | |||||||||
15,692 | Time Warner Cable, Inc., Class A* | 439,376 | |||||||||
312,973 | Time Warner, Inc. | 4,647,648 | |||||||||
22,950 | TJX Cos., Inc. | 739,449 | |||||||||
16,550 | Toll Brothers, Inc.* | 374,692 | |||||||||
9,653 | Travelcenters of America, LLC* | 31,179 | |||||||||
25,011 | TRW Automotive Holdings Corp.* | 639,281 | |||||||||
3,572 | Tupperware Brands Corp. | 140,737 | |||||||||
7,168 | VF Corp. | 533,156 | |||||||||
22,283 | Viacom, Inc., Class B* | 856,559 | |||||||||
33,148 | Virgin Media, Inc. | 427,609 | |||||||||
110,867 | Visteon Corp.* | 481,163 | |||||||||
3,246 | WABCO Holdings, Inc. | 155,029 | |||||||||
98,607 | Walt Disney (The) Co. | 3,197,825 | |||||||||
15,418 | Warner Music Group Corp. | 133,982 | |||||||||
168 | Washington Post (The) Co., Class B | 110,141 | |||||||||
38,348 | WCI Communities, Inc.* | 126,165 | |||||||||
9,287 | Wendy's International, Inc. | 269,323 | |||||||||
8,785 | Whirlpool Corp. | 639,372 | |||||||||
7,754 | Williams-Sonoma, Inc. | 204,706 | |||||||||
19,357 | Wyndham Worldwide Corp. | 415,788 | |||||||||
16,253 | Yum! Brands, Inc. | 661,172 | |||||||||
7,491 | Zale Corp.* | 155,214 | |||||||||
111,627,254 | |||||||||||
Consumer Staples—10.0% | |||||||||||
22,656 | Alberto-Culver Co. | 570,252 | |||||||||
163,579 | Altria Group, Inc. | 3,271,580 | |||||||||
39,554 | Anheuser-Busch Cos., Inc. | 1,946,057 | |||||||||
40,803 | Archer-Daniels-Midland Co. | 1,797,780 | |||||||||
16,833 | Avon Products, Inc. | 656,824 | |||||||||
10,566 | BJ's Wholesale Club, Inc.* | 402,776 | |||||||||
3,592 | Brown-Forman Corp., Class B | 244,328 | |||||||||
8,428 | Bunge Ltd. | 961,551 | |||||||||
17,011 | Campbell Soup Co. | 591,983 | |||||||||
5,443 | Carolina Group | 357,442 | |||||||||
4,671 | Casey's General Stores, Inc. | 103,369 | |||||||||
6,699 | Chiquita Brands International, Inc.* | 152,402 | |||||||||
8,139 | Clorox (The) Co. | 431,367 | |||||||||
81,706 | Coca-Cola (The) Co. | 4,810,032 |
See Notes to Financial Statements.
28
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1000 Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
33,780 | Coca-Cola Enterprises, Inc. | $ | 760,050 | ||||||||
16,134 | Colgate-Palmolive Co. | 1,140,674 | |||||||||
56,450 | ConAgra Foods, Inc. | 1,329,962 | |||||||||
22,491 | Constellation Brands, Inc., Class A* | 412,935 | |||||||||
4,471 | Corn Products International, Inc. | 207,365 | |||||||||
10,058 | Cosan Ltd., Class A (Brazil)* | 133,369 | |||||||||
32,794 | Costco Wholesale Corp. | 2,336,573 | |||||||||
40,778 | CVS Caremark Corp. | 1,646,208 | |||||||||
30,173 | Dean Foods Co.* | 701,221 | |||||||||
21,498 | Del Monte Foods Co. | 193,912 | |||||||||
2,496 | Energizer Holdings, Inc.* | 197,334 | |||||||||
9,503 | Estee Lauder (The) Cos., Inc., Class A | 433,432 | |||||||||
4,552 | Fresh Del Monte Produce, Inc.* | 144,253 | |||||||||
23,307 | General Mills, Inc. | 1,407,743 | |||||||||
6,388 | Great Atlantic & Pacific Tea Co., Inc.* | 175,798 | |||||||||
21,748 | H.J. Heinz Co. | 1,022,808 | |||||||||
13,593 | Hershey (The) Co. | 508,106 | |||||||||
5,983 | Hormel Foods Corp. | 235,790 | |||||||||
4,074 | J.M. Smucker (The) Co. | 203,211 | |||||||||
15,983 | Kellogg Co. | 817,850 | |||||||||
28,264 | Kimberly-Clark Corp. | 1,808,613 | |||||||||
132,824 | Kraft Foods, Inc., Class A | 4,201,223 | |||||||||
86,937 | Kroger (The) Co. | 2,369,033 | |||||||||
3,972 | Longs Drug Stores Corp. | 159,118 | |||||||||
7,333 | McCormick & Co., Inc. | 277,114 | |||||||||
9,782 | Molson Coors Brewing Co., Class B | 536,445 | |||||||||
3,912 | Nash Finch Co. | 143,101 | |||||||||
4,039 | NBTY, Inc.* | 113,698 | |||||||||
6,207 | Pantry (The), Inc.* | 67,346 | |||||||||
13,898 | Pepsi Bottling Group (The), Inc. | 468,502 | |||||||||
7,771 | PepsiAmericas, Inc. | 199,715 | |||||||||
54,685 | PepsiCo, Inc. | 3,747,563 | |||||||||
7,585 | Performance Food Group Co.* | 253,794 | |||||||||
163,579 | Philip Morris International, Inc.* | 8,347,436 | |||||||||
7,525 | Pilgrim's Pride Corp. | 181,879 | |||||||||
132,928 | Procter & Gamble (The) Co. | 8,912,821 | |||||||||
14,327 | Reynolds American, Inc. | 771,509 | |||||||||
199,704 | Rite Aid Corp.* | 539,201 | |||||||||
3,619 | Ruddick Corp. | 140,055 | |||||||||
51,670 | Safeway, Inc. | 1,632,772 | |||||||||
99,970 | Sara Lee Corp. | 1,450,565 | |||||||||
29 | Seaboard Corp. | 48,720 | |||||||||
19,923 | Smithfield Foods, Inc.* | 571,392 | |||||||||
38,187 | SUPERVALU, Inc. | 1,263,990 | |||||||||
52,868 | Sysco Corp. | 1,616,175 | |||||||||
70,634 | Tyson Foods, Inc., Class A | 1,257,285 | |||||||||
2,968 | Universal Corp. | 190,516 | |||||||||
9,592 | UST, Inc. | 499,455 | |||||||||
57,375 | Walgreen Co. | 1,999,519 | |||||||||
214,934 | Wal-Mart Stores, Inc. | 12,461,872 | |||||||||
1,673 | Weis Markets, Inc. | 51,378 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
9,567 | Whole Foods Market, Inc. | $ | 312,267 | ||||||||
8,854 | Winn-Dixie Stores, Inc.* | 156,981 | |||||||||
6,954 | Wm. Wrigley Jr. Co. | 529,617 | |||||||||
87,587,007 | |||||||||||
Energy—9.8% | |||||||||||
2,351 | Alon USA Energy, Inc. | 32,796 | |||||||||
24,062 | Anadarko Petroleum Corp. | 1,601,567 | |||||||||
12,044 | Apache Corp. | 1,622,086 | |||||||||
3,102 | Arch Coal, Inc. | 177,931 | |||||||||
10,449 | Baker Hughes, Inc. | 845,115 | |||||||||
13,776 | BJ Services Co. | 389,448 | |||||||||
5,268 | Cameron International Corp.* | 259,344 | |||||||||
18,560 | Chesapeake Energy Corp. | 959,552 | |||||||||
149,706 | Chevron Corp. | 14,394,231 | |||||||||
4,001 | Cimarex Energy Co. | 249,262 | |||||||||
120,461 | ConocoPhillips | 10,377,715 | |||||||||
2,911 | CONSOL Energy, Inc. | 235,675 | |||||||||
3,251 | CVR Energy, Inc.* | 69,994 | |||||||||
3,919 | Denbury Resources, Inc.* | 119,765 | |||||||||
17,474 | Devon Energy Corp. | 1,981,552 | |||||||||
1,219 | Diamond Offshore Drilling, Inc. | 152,875 | |||||||||
48,251 | El Paso Corp. | 827,022 | |||||||||
3,993 | ENSCO International, Inc. | 254,474 | |||||||||
4,815 | EOG Resources, Inc. | 628,261 | |||||||||
280,721 | Exxon Mobil Corp. | 26,126,702 | |||||||||
3,191 | FMC Technologies, Inc.* | 214,435 | |||||||||
4,323 | Forest Oil Corp.* | 254,754 | |||||||||
2,925 | Foundation Coal Holdings, Inc. | 175,442 | |||||||||
3,447 | Frontier Oil Corp. | 85,658 | |||||||||
4,044 | General Maritime Corp. | 105,670 | |||||||||
32,855 | Halliburton Co. | 1,508,373 | |||||||||
4,118 | Helix Energy Solutions Group, Inc.* | 142,277 | |||||||||
3,633 | Helmerich & Payne, Inc. | 195,274 | |||||||||
11,022 | Hess Corp. | 1,170,536 | |||||||||
52,613 | Marathon Oil Corp. | 2,397,574 | |||||||||
3,238 | Massey Energy Co. | 169,445 | |||||||||
7,586 | Murphy Oil Corp. | 685,319 | |||||||||
14,019 | Nabors Industries Ltd. (Bermuda)* | 526,273 | |||||||||
8,938 | National Oilwell Varco, Inc.* | 611,806 | |||||||||
7,097 | Newfield Exploration Co.* | 431,214 | |||||||||
5,080 | Noble Corp. | 285,902 | |||||||||
4,761 | Noble Energy, Inc. | 414,207 | |||||||||
30,764 | Occidental Petroleum Corp. | 2,559,872 | |||||||||
3,046 | Overseas Shipholding Group, Inc. | 229,242 | |||||||||
7,702 | Patterson-UTI Energy, Inc. | 215,194 | |||||||||
5,185 | Peabody Energy Corp. | 316,959 | |||||||||
6,603 | PetroHawk Energy Corp.* | 156,095 | |||||||||
6,219 | Pioneer Natural Resources Co. | 359,023 | |||||||||
2,976 | Plains Exploration & Production Co.* | 185,345 | |||||||||
8,397 | Pride International, Inc.* | 356,453 |
See Notes to Financial Statements.
29
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1000 Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
3,792 | Rowan Cos., Inc. | $ | 147,850 | ||||||||
19,659 | Schlumberger Ltd. | 1,976,712 | |||||||||
1,436 | SEACOR Holdings, Inc.* | 122,218 | |||||||||
4,762 | Ship Finance International Ltd. (Bermuda) | 144,384 | |||||||||
5,029 | Smith International, Inc. | 384,769 | |||||||||
4,415 | Southwestern Energy Co.* | 186,799 | |||||||||
26,396 | Spectra Energy Corp. | 651,981 | |||||||||
2,736 | Stone Energy Corp.* | 166,732 | |||||||||
15,415 | Sunoco, Inc. | 715,410 | |||||||||
4,869 | Teekay Shipping Corp. (Bahamas) | 222,221 | |||||||||
14,166 | Tesoro Corp. | 356,133 | |||||||||
2,922 | Tidewater, Inc. | 190,573 | |||||||||
3,686 | Transocean, Inc.* | 543,538 | |||||||||
2,400 | Unit Corp.* | 152,424 | |||||||||
19,817 | USEC, Inc.* | 91,951 | |||||||||
48,592 | Valero Energy Corp. | 2,373,719 | |||||||||
8,959 | Weatherford International Ltd.* | 722,723 | |||||||||
1,855 | Whiting Petroleum Corp.* | 141,945 | |||||||||
25,854 | Williams (The) Cos., Inc. | 917,817 | |||||||||
5,301 | World Fuel Services Corp. | 130,193 | |||||||||
10,152 | XTO Energy, Inc. | 628,003 | |||||||||
86,025,804 | |||||||||||
Financials—24.7% | |||||||||||
22,599 | ACE Ltd. | 1,362,494 | |||||||||
17,797 | AFLAC, Inc. | 1,186,526 | |||||||||
1,248 | Alexandria Real Estate Equities, Inc. | 131,077 | |||||||||
375 | Alleghany Corp.* | 129,188 | |||||||||
22,029 | Allied Capital Corp. | 442,783 | |||||||||
5,864 | Allied World Assurance Holdings Ltd. (Bermuda) | 241,773 | |||||||||
61,685 | Allstate (The) Corp. | 3,106,457 | |||||||||
5,596 | AMB Property Corp. | 323,169 | |||||||||
113,648 | AMBAC Financial Group, Inc. | 526,190 | |||||||||
13,418 | American Capital Strategies Ltd. | 426,022 | |||||||||
63,650 | American Express Co. | 3,056,473 | |||||||||
6,496 | American Financial Group, Inc. | 178,120 | |||||||||
230,180 | American International Group, Inc. | 10,634,315 | |||||||||
885 | American National Insurance | 98,925 | |||||||||
22,614 | AmeriCredit Corp.* | 315,691 | |||||||||
14,845 | Ameriprise Financial, Inc. | 704,989 | |||||||||
16,347 | Annaly Capital Management, Inc. | 273,976 | |||||||||
18,667 | AON Corp. | 847,295 | |||||||||
12,394 | Apartment Investment & Management Co., Class A | 458,330 | |||||||||
9,982 | Apollo Investment Corp. | 161,509 | |||||||||
3,468 | Arch Capital Group Ltd. (Bermuda)* | 245,014 | |||||||||
7,268 | Arthur J. Gallagher & Co. | 178,575 | |||||||||
5,108 | Aspen Insurance Holdings Ltd. (Bermuda) | 132,757 | |||||||||
11,935 | Associated Banc-Corp | 337,402 | |||||||||
7,336 | Assurant, Inc. | 476,840 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
7,799 | Astoria Financial Corp. | $ | 184,836 | ||||||||
3,937 | AvalonBay Communities, Inc. | 392,716 | |||||||||
8,854 | Axis Capital Holdings Ltd. (Bermuda) | 300,239 | |||||||||
6,598 | BancorpSouth, Inc. | 158,550 | |||||||||
431,067 | Bank of America Corp. | 16,182,254 | |||||||||
3,143 | Bank of Hawaii Corp. | 172,331 | |||||||||
38,458 | Bank of New York Mellon (The) Corp. | 1,674,077 | |||||||||
56,994 | BB&T Corp. | 1,954,324 | |||||||||
14,146 | Bear Stearns (The) Cos., Inc. | 151,787 | |||||||||
1,599 | Berkshire Hathaway, Inc., Class B* | 7,126,743 | |||||||||
972 | BOK Financial Corp. | 55,501 | |||||||||
8,173 | Boston Properties, Inc. | 821,305 | |||||||||
11,149 | Brandywine Realty Trust | 194,550 | |||||||||
3,568 | BRE Properties, Inc. | 171,086 | |||||||||
4,697 | Camden Property Trust | 248,518 | |||||||||
37,569 | Capital One Financial Corp. | 1,991,157 | |||||||||
12,913 | CapitalSource, Inc. | 181,428 | |||||||||
7,301 | CB Richard Ellis Group, Inc., Class A* | 168,799 | |||||||||
8,609 | CBL & Associates Properties, Inc. | 210,834 | |||||||||
29,954 | Charles Schwab (The) Corp. | 647,006 | |||||||||
28,208 | Chubb (The) Corp. | 1,494,178 | |||||||||
17,399 | Cincinnati Financial Corp. | 624,624 | |||||||||
39,009 | CIT Group, Inc. | 424,808 | |||||||||
848,123 | Citigroup, Inc. | 21,432,067 | |||||||||
12,874 | Citizens Republic Bancorp, Inc. | 106,211 | |||||||||
3,767 | City National Corp. | 182,775 | |||||||||
379 | CME Group, Inc. | 173,374 | |||||||||
3,550 | CNA Financial Corp. | 95,176 | |||||||||
18,532 | Colonial BancGroup (The), Inc. | 150,850 | |||||||||
6,691 | Colonial Properties Trust | 162,123 | |||||||||
23,161 | Comerica, Inc. | 804,382 | |||||||||
4,629 | Commerce Bancshares, Inc. | 201,362 | |||||||||
3,775 | Commerce Group (The), Inc. | 137,561 | |||||||||
5,884 | CompuCredit Corp.* | 47,543 | |||||||||
38,710 | Conseco, Inc.* | 450,972 | |||||||||
247,642 | Countrywide Financial Corp. | 1,431,371 | |||||||||
7,161 | Cousins Properties, Inc. | 181,961 | |||||||||
3,230 | Cullen/Frost Bankers, Inc. | 180,299 | |||||||||
7,764 | Developers Diversified Realty Corp. | 333,464 | |||||||||
59,752 | Discover Financial Services | 1,088,084 | |||||||||
3,922 | Downey Financial Corp. | 55,457 | |||||||||
18,448 | Duke Realty Corp. | 450,500 | |||||||||
116,913 | E*TRADE Financial Corp.* | 465,314 | |||||||||
5,017 | Endurance Specialty Holdings Ltd. (Bermuda) | 186,281 | |||||||||
3,384 | Equity One, Inc. | 83,585 | |||||||||
22,107 | Equity Residential | 917,883 | |||||||||
1,407 | Erie Indemnity Co., Class A | 75,162 | |||||||||
3,956 | Everest Re Group Ltd. | 357,425 | |||||||||
173,648 | Fannie Mae | 4,914,238 | |||||||||
2,577 | Federal Realty Investment Trust | 211,701 |
See Notes to Financial Statements.
30
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1000 Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
2,746 | Federated Investors, Inc., Class B | $ | 91,936 | ||||||||
58,128 | Fidelity National Title Group, Inc., Class A | 929,467 | |||||||||
75,382 | Fifth Third Bancorp | 1,615,436 | |||||||||
13,232 | First American (The) Corp. | 434,010 | |||||||||
27,918 | First Horizon National Corp. | 301,514 | |||||||||
5,587 | First Industrial Realty Trust, Inc. | 168,783 | |||||||||
9,703 | FirstMerit Corp. | 199,106 | |||||||||
9,553 | Flagstar Bancorp, Inc. | 58,464 | |||||||||
6,513 | Franklin Resources, Inc. | 619,712 | |||||||||
141,010 | Freddie Mac | 3,512,559 | |||||||||
79,067 | Friedman Billings Ramsey Group, Inc., Class A | 196,877 | |||||||||
16,395 | Fulton Financial Corp. | 204,446 | |||||||||
11,715 | General Growth Properties, Inc. | 479,846 | |||||||||
52,304 | Genworth Financial, Inc., Class A | 1,206,130 | |||||||||
22,539 | Goldman Sachs Group (The), Inc. | 4,313,288 | |||||||||
2,084 | Gramercy Capital Corp. | 39,596 | |||||||||
3,683 | Hanover Insurance Group (The), Inc. | 165,293 | |||||||||
31,983 | Hartford Financial Services Group (The), Inc. | 2,279,428 | |||||||||
7,497 | HCC Insurance Holdings, Inc. | 185,026 | |||||||||
13,584 | HCP, Inc. | 484,949 | |||||||||
5,868 | Health Care REIT, Inc. | 284,305 | |||||||||
7,102 | Healthcare Realty Trust, Inc. | 201,200 | |||||||||
5,650 | Highwoods Properties, Inc. | 197,976 | |||||||||
2,978 | Home Properties, Inc. | 156,553 | |||||||||
8,473 | Hospitality Properties Trust | 272,237 | |||||||||
27,564 | Host Hotels & Resorts, Inc. | 474,101 | |||||||||
39,034 | HRPT Properties Trust | 270,506 | |||||||||
22,798 | Hudson City Bancorp, Inc. | 436,126 | |||||||||
40,595 | Huntington Bancshares, Inc. | 381,187 | |||||||||
40,981 | IndyMac Bancorp, Inc. | 133,188 | |||||||||
7,449 | Interactive Brokers Group, Inc., Class A* | 235,165 | |||||||||
4,012 | IPC Holdings Ltd. | 116,789 | |||||||||
24,113 | iStar Financial, Inc. | 464,175 | |||||||||
7,091 | Janus Capital Group, Inc. | 198,973 | |||||||||
6,332 | Jefferies Group, Inc. | 119,042 | |||||||||
308,772 | JPMorgan Chase & Co. | 14,712,985 | |||||||||
57,729 | Keycorp | 1,393,001 | |||||||||
13,274 | Kimco Realty Corp. | 529,765 | |||||||||
4,802 | LandAmerica Financial Group, Inc. | 137,817 | |||||||||
7,012 | Legg Mason, Inc. | 422,683 | |||||||||
42,040 | Lehman Brothers Holdings, Inc. | 1,859,850 | |||||||||
3,530 | Leucadia National Corp. | 180,807 | |||||||||
5,972 | Liberty Media Corp.Capital, Series A* | 91,790 | |||||||||
11,330 | Liberty Property Trust | 396,890 | |||||||||
20,133 | Lincoln National Corp. | 1,082,350 | |||||||||
35,037 | Loews Corp. | 1,475,408 | |||||||||
8,095 | M&T Bank Corp. | 754,697 | |||||||||
3,830 | Macerich (The) Co. | 280,088 | |||||||||
7,362 | Mack-Cali Realty Corp. | 287,265 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
535 | Markel Corp.* | $ | 232,404 | ||||||||
49,926 | Marsh & McLennan Cos., Inc. | 1,377,458 | |||||||||
28,849 | Marshall & Ilsley Corp. | 720,648 | |||||||||
47,032 | MBIA, Inc. | 489,133 | |||||||||
2,890 | Mercury General Corp. | 144,182 | |||||||||
79,743 | Merrill Lynch & Co., Inc. | 3,973,594 | |||||||||
52,358 | MetLife, Inc. | 3,185,984 | |||||||||
10,869 | MF Global Ltd.* | 143,145 | |||||||||
22,206 | MGIC Investment Corp. | 289,344 | |||||||||
13,189 | Montpelier Re Holdings Ltd. (Bermuda) | 217,619 | |||||||||
5,575 | Moody's Corp. | 206,052 | |||||||||
113,805 | Morgan Stanley | 5,530,923 | |||||||||
5,015 | Nasdaq Stock Market (The), Inc.* | 182,797 | |||||||||
140,562 | National City Corp. | 885,541 | |||||||||
12,539 | Nationwide Financial Services, Inc., Class A | 628,455 | |||||||||
5,436 | Nationwide Health Properties, Inc. | 195,805 | |||||||||
5,442 | Nelnet, Inc., Class A | 69,603 | |||||||||
27,534 | New York Community Bancorp, Inc. | 514,060 | |||||||||
12,464 | Newcastle Investment Corp. | 123,269 | |||||||||
8,239 | Northern Trust Corp. | 610,592 | |||||||||
699 | Nymex Holdings Inc | 64,727 | |||||||||
2,817 | NYSE Euronext | 186,204 | |||||||||
12,998 | Och-Ziff Capital Management Group LLC, Class A | 252,291 | |||||||||
2,088 | Odyssey Re Holdings Corp. | 74,709 | |||||||||
37,053 | Old Republic International Corp. | 531,711 | |||||||||
10,633 | OneBeacon Insurance Group Ltd. | 209,045 | |||||||||
4,585 | PartnerRe Ltd. | 339,198 | |||||||||
4,725 | Pennsylvania REIT | 118,976 | |||||||||
8,856 | People's United Financial, Inc. | 150,286 | |||||||||
3,571 | Philadelphia Consolidated Holding Co.* | 131,698 | |||||||||
16,274 | Phoenix (The) Cos., Inc. | 211,562 | |||||||||
3,267 | Platinum Underwriters Holdings Ltd. (Bermuda) | 117,187 | |||||||||
11,729 | Plum Creek Timber Co., Inc. | 479,012 | |||||||||
31,543 | PMI Group (The), Inc. | 177,587 | |||||||||
24,730 | PNC Financial Services Group, Inc. | 1,715,026 | |||||||||
43,807 | Popular, Inc. | 546,273 | |||||||||
3,211 | Post Properties, Inc. | 117,844 | |||||||||
5,083 | Potlatch Corp. | 227,769 | |||||||||
15,605 | Principal Financial Group, Inc. | 837,364 | |||||||||
48,817 | Progressive (The) Corp. | 887,981 | |||||||||
11,646 | ProLogis | 729,156 | |||||||||
6,930 | Protective Life Corp. | 295,357 | |||||||||
34,118 | Prudential Financial, Inc. | 2,583,074 | |||||||||
5,217 | Public Storage | 473,182 | |||||||||
37,316 | Radian Group, Inc. | 201,506 | |||||||||
8,791 | Raymond James Financial, Inc. | 252,917 | |||||||||
5,152 | Rayonier, Inc. | 216,539 | |||||||||
7,419 | Realty Income Corp. | 195,194 | |||||||||
6,428 | Redwood Trust, Inc. | 213,988 |
See Notes to Financial Statements.
31
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1000 Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
3,991 | Regency Centers Corp. | $ | 285,636 | ||||||||
75,586 | Regions Financial Corp. | 1,656,845 | |||||||||
2,322 | Reinsurance Group of America, Inc. | 120,698 | |||||||||
3,972 | RenaissanceRe Holdings Ltd. (Bermuda) | 204,320 | |||||||||
12,020 | Safeco Corp. | 802,215 | |||||||||
5,010 | Selective Insurance Group | 106,813 | |||||||||
7,452 | Senior Housing Properties Trust | 178,475 | |||||||||
9,027 | Simon Property Group, Inc. | 901,436 | |||||||||
2,029 | SL Green Realty Corp. | 188,291 | |||||||||
45,841 | SLM Corp. | 849,434 | |||||||||
10,113 | South Financial Group (The), Inc. | 61,083 | |||||||||
54,803 | Sovereign Bancorp, Inc. | 409,378 | |||||||||
3,535 | StanCorp Financial Group, Inc. | 181,133 | |||||||||
12,027 | State Street Corp. | 867,628 | |||||||||
2,896 | Stewart Information Services Corp. | 70,923 | |||||||||
457 | Student Loan Corp. | 58,121 | |||||||||
35,054 | SunTrust Banks, Inc. | 1,954,261 | |||||||||
48,271 | Synovus Financial Corp. | 571,529 | |||||||||
6,465 | T. Rowe Price Group, Inc. | 378,590 | |||||||||
12,748 | TCF Financial Corp. | 221,815 | |||||||||
19,474 | TD Ameritrade Holding Corp.* | 352,479 | |||||||||
4,104 | TFS Financial Corp. | 50,192 | |||||||||
41,114 | Thornburg Mortgage, Inc. | 50,159 | |||||||||
6,531 | Torchmark Corp. | 422,817 | |||||||||
1,705 | Transatlantic Holdings, Inc. | 110,569 | |||||||||
55,619 | Travelers (The) Cos., Inc. | 2,803,198 | |||||||||
6,183 | Trustmark Corp. | 134,666 | |||||||||
134,964 | U.S. Bancorp | 4,573,930 | |||||||||
10,314 | UDR, Inc. | 260,738 | |||||||||
5,547 | UnionBanCal Corp. | 291,273 | |||||||||
7,124 | Unitrin, Inc. | 270,285 | |||||||||
33,490 | Unum Group | 777,303 | |||||||||
9,764 | Valley National Bancorp | 187,371 | |||||||||
4,325 | Ventas, Inc. | 210,022 | |||||||||
9,372 | Vornado Realty Trust | 872,439 | |||||||||
12,145 | W.R. Berkley Corp. | 312,005 | |||||||||
234,828 | Wachovia Corp. | 6,845,236 | |||||||||
7,040 | Washington Federal, Inc. | 167,622 | |||||||||
282,549 | Washington Mutual, Inc. | 3,472,527 | |||||||||
6,580 | Webster Financial Corp. | 171,409 | |||||||||
7,020 | Weingarten Realty Investors | 258,968 | |||||||||
273,421 | Wells Fargo & Co. | 8,134,274 | |||||||||
84 | Wesco Financial Corp. | 36,376 | |||||||||
758 | White Mountains Insurance Group Ltd. | 360,884 | |||||||||
5,812 | Whitney Holding Corp. | 136,059 | |||||||||
6,419 | Willis Group Holdings Ltd. | 223,060 | |||||||||
5,651 | Wilmington Trust Corp. | 185,805 | |||||||||
26,207 | XL Capital Ltd., Class A | 914,362 | |||||||||
9,844 | Zions Bancorporation | 456,269 | |||||||||
216,786,339 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Health Care—8.6% | |||||||||||
65,537 | Abbott Laboratories | $ | 3,457,077 | ||||||||
19,859 | Aetna, Inc. | 865,852 | |||||||||
1,579 | Alcon, Inc. (Switzerland) | 249,482 | |||||||||
4,662 | Allergan, Inc. | 262,797 | |||||||||
3,336 | AMERIGROUP Corp.* | 86,703 | |||||||||
34,852 | AmerisourceBergen Corp. | 1,413,249 | |||||||||
47,521 | Amgen, Inc.* | 1,989,704 | |||||||||
5,306 | Applera Corp.-Applied Biosystems Group | 169,314 | |||||||||
5,795 | Apria Healthcare Group, Inc.* | 102,108 | |||||||||
3,154 | Barr Pharmaceuticals, Inc.* | 158,425 | |||||||||
19,904 | Baxter International, Inc. | 1,240,417 | |||||||||
2,941 | Beckman Coulter, Inc. | 200,870 | |||||||||
7,663 | Becton, Dickinson & Co. | 685,072 | |||||||||
8,953 | Biogen Idec, Inc.* | 543,358 | |||||||||
99,382 | Boston Scientific Corp.* | 1,324,762 | |||||||||
170,592 | Bristol-Myers Squibb Co. | 3,747,906 | |||||||||
2,510 | Brookdale Senior Living, Inc. | 65,712 | |||||||||
40,608 | Cardinal Health, Inc. | 2,114,459 | |||||||||
2,313 | Celgene Corp.* | 143,730 | |||||||||
2,389 | Cephalon, Inc.* | 149,097 | |||||||||
2,688 | Cerner Corp.* | 124,374 | |||||||||
2,569 | Charles River Laboratories International, Inc.* | 149,130 | |||||||||
21,673 | CIGNA Corp. | 925,654 | |||||||||
9,176 | Community Health Systems, Inc.* | 344,375 | |||||||||
1,365 | Covance, Inc.* | 114,373 | |||||||||
8,540 | Coventry Health Care, Inc.* | 381,994 | |||||||||
20,725 | Covidien Ltd. | 967,650 | |||||||||
2,313 | CR Bard, Inc. | 217,815 | |||||||||
5,416 | DaVita, Inc.* | 283,853 | |||||||||
4,040 | DENTSPLY International, Inc. | 157,035 | |||||||||
60,205 | Eli Lilly & Co. | 2,898,269 | |||||||||
11,363 | Express Scripts, Inc.* | 795,637 | |||||||||
10,268 | Forest Laboratories, Inc.* | 356,402 | |||||||||
5,853 | Genentech, Inc.* | 399,175 | |||||||||
6,879 | Genzyme Corp.* | 483,938 | |||||||||
6,341 | Gilead Sciences, Inc.* | 328,210 | |||||||||
52,184 | Health Management Associates, Inc., Class A* | 372,072 | |||||||||
11,872 | Health Net, Inc.* | 347,731 | |||||||||
4,337 | Henry Schein, Inc.* | 240,140 | |||||||||
4,263 | Hill-Rom Holdings, Inc. | 107,129 | |||||||||
5,978 | Hospira, Inc.* | 245,995 | |||||||||
10,245 | Humana, Inc.* | 489,609 | |||||||||
6,069 | IMS Health, Inc. | 150,208 | |||||||||
2,025 | Invitrogen Corp.* | 189,479 | |||||||||
130,664 | Johnson & Johnson | 8,766,248 | |||||||||
7,144 | Kindred Healthcare, Inc.* | 169,527 | |||||||||
26,473 | King Pharmaceuticals, Inc.* | 248,581 |
See Notes to Financial Statements.
32
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1000 Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
4,382 | Laboratory Corp. of America Holdings* | $ | 331,367 | ||||||||
6,554 | LifePoint Hospitals, Inc.* | 197,406 | |||||||||
4,892 | Lincare Holdings, Inc.* | 119,071 | |||||||||
3,129 | Magellan Health Services, Inc.* | 120,748 | |||||||||
39,917 | McKesson Corp. | 2,080,474 | |||||||||
39,884 | Medco Health Solutions, Inc.* | 1,975,853 | |||||||||
33,247 | Medtronic, Inc. | 1,618,464 | |||||||||
135,907 | Merck & Co., Inc. | 5,169,902 | |||||||||
13,733 | Mylan, Inc. | 180,864 | |||||||||
14,576 | Omnicare, Inc. | 296,622 | |||||||||
3,953 | Owens & Minor, Inc. | 179,150 | |||||||||
5,681 | Patterson Cos., Inc.* | 194,290 | |||||||||
6,665 | PerkinElmer, Inc. | 177,022 | |||||||||
575,979 | Pfizer, Inc. | 11,582,938 | |||||||||
6,965 | Quest Diagnostics, Inc. | 349,504 | |||||||||
56,090 | Schering-Plough Corp. | 1,032,617 | |||||||||
8,438 | St. Jude Medical, Inc.* | 369,416 | |||||||||
5,447 | Stryker Corp. | 353,129 | |||||||||
116,680 | Tenet Healthcare Corp.* | 746,752 | |||||||||
14,775 | Thermo Fisher Scientific, Inc.* | 855,029 | |||||||||
50,176 | UnitedHealth Group, Inc. | 1,637,243 | |||||||||
4,193 | Universal Health Services, Inc., Class B | 262,650 | |||||||||
2,797 | Varian Medical Systems, Inc.* | 131,123 | |||||||||
3,231 | Warner Chilcott Ltd., Class A* | 55,606 | |||||||||
7,823 | Watson Pharmaceuticals, Inc.* | 242,826 | |||||||||
38,055 | WellPoint, Inc.* | 1,893,236 | |||||||||
68,999 | Wyeth | 3,068,386 | |||||||||
6,776 | Zimmer Holdings, Inc.* | 502,508 | |||||||||
74,948,893 | |||||||||||
Industrials—10.8% | |||||||||||
35,619 | 3M Co. | 2,739,101 | |||||||||
3,054 | Acuity Brands, Inc. | 146,103 | |||||||||
7,543 | Aecom Technology Corp.* | 207,131 | |||||||||
4,353 | AGCO Corp.* | 261,746 | |||||||||
6,441 | Alaska Air Group, Inc.* | 138,353 | |||||||||
3,287 | Alexander & Baldwin, Inc. | 165,106 | |||||||||
1,857 | Alliant Techsystems, Inc.* | 204,233 | |||||||||
61,831 | Allied Waste Industries, Inc.* | 764,231 | |||||||||
2,498 | AMERCO* | 143,460 | |||||||||
2,687 | AMETEK, Inc. | 130,373 | |||||||||
56,094 | AMR Corp.* | 491,944 | |||||||||
2,975 | Armstrong World Industries, Inc. | 105,880 | |||||||||
8,653 | Avery Dennison Corp. | 416,988 | |||||||||
48,171 | Avis Budget Group, Inc.* | 639,711 | |||||||||
25,187 | BlueLinx Holdings, Inc. | 130,469 | |||||||||
34,395 | Boeing Co. | 2,918,760 | |||||||||
8,652 | Briggs & Stratton Corp. | 131,683 | |||||||||
2,294 | Brink's (The) Co. | 166,889 | |||||||||
15,891 | Burlington Northern Santa Fe Corp. | 1,629,622 | |||||||||
4,753 | C.H. Robinson Worldwide, Inc. | 297,918 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
4,121 | Carlisle Cos., Inc. | $ | 119,014 | ||||||||
30,270 | Caterpillar, Inc. | 2,478,508 | |||||||||
2,298 | ChoicePoint, Inc.* | 111,108 | |||||||||
7,702 | Cintas Corp. | 228,056 | |||||||||
18,483 | Continental Airlines, Inc., Class B* | 332,324 | |||||||||
4,724 | Con-way, Inc. | 218,485 | |||||||||
10,076 | Cooper Industries Ltd., Class A | 427,122 | |||||||||
5,479 | Corrections Corp. of America* | 139,715 | |||||||||
3,073 | Covanta Holding Corp.* | 81,834 | |||||||||
3,414 | Crane Co. | 139,769 | |||||||||
18,732 | CSX Corp. | 1,179,179 | |||||||||
9,477 | Cummins, Inc. | 593,734 | |||||||||
6,315 | Danaher Corp. | 492,696 | |||||||||
16,139 | Deere & Co. | 1,356,806 | |||||||||
8,369 | Deluxe Corp. | 177,925 | |||||||||
12,582 | Dollar Thrifty Automotive Group* | 165,957 | |||||||||
12,189 | Dover Corp. | 602,990 | |||||||||
2,133 | DRS Technologies, Inc. | 133,185 | |||||||||
9,170 | Eaton Corp. | 805,493 | |||||||||
8,438 | EMCOR Group, Inc.* | 211,456 | |||||||||
38,897 | Emerson Electric Co. | 2,032,757 | |||||||||
4,040 | Equifax, Inc. | 154,611 | |||||||||
4,797 | Expeditors International of Washington, Inc. | 223,492 | |||||||||
3,149 | Fastenal Co. | 153,703 | |||||||||
20,596 | FedEx Corp. | 1,974,539 | |||||||||
1,763 | Flowserve Corp. | 218,771 | |||||||||
3,300 | Fluor Corp. | 504,471 | |||||||||
1,877 | Foster Wheeler Ltd.* | 119,546 | |||||||||
4,590 | GATX Corp. | 201,960 | |||||||||
17,939 | General Dynamics Corp. | 1,622,044 | |||||||||
625,387 | General Electric Co. | 20,450,154 | |||||||||
6,666 | Goodrich Corp. | 454,288 | |||||||||
3,623 | Granite Construction, Inc. | 124,269 | |||||||||
3,902 | Harsco Corp. | 231,506 | |||||||||
74,370 | Hertz Global Holdings, Inc.* | 956,398 | |||||||||
4,689 | HNI Corp. | 102,080 | |||||||||
37,637 | Honeywell International, Inc. | 2,235,638 | |||||||||
4,461 | Hubbell, Inc., Class B | 199,541 | |||||||||
25,100 | IKON Office Solutions, Inc. | 274,845 | |||||||||
26,528 | Illinois Tool Works, Inc. | 1,387,149 | |||||||||
18,831 | Ingersoll-Rand Co. Ltd., Class A | 835,720 | |||||||||
8,069 | ITT Corp. | 516,416 | |||||||||
4,634 | J.B. Hunt Transport Services, Inc. | 157,417 | |||||||||
4,512 | Jacobs Engineering Group, Inc.* | 389,521 | |||||||||
17,329 | JetBlue Airways Corp.* | 87,338 | |||||||||
1,840 | Joy Global, Inc. | 136,620 | |||||||||
4,190 | Kansas City Southern* | 188,885 | |||||||||
13,260 | KBR, Inc. | 382,418 | |||||||||
8,524 | Kelly Services, Inc., Class A | 189,659 | |||||||||
5,715 | Kennametal, Inc. | 198,711 |
See Notes to Financial Statements.
33
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1000 Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
5,279 | L-3 Communications Holdings, Inc. | $ | 588,345 | ||||||||
3,934 | Lennox International, Inc. | 130,373 | |||||||||
1,738 | Lincoln Electric Holdings, Inc. | 132,609 | |||||||||
18,603 | Lockheed Martin Corp. | 1,972,662 | |||||||||
8,856 | Manpower, Inc. | 594,503 | |||||||||
53,690 | Masco Corp. | 977,695 | |||||||||
2,179 | McDermott International, Inc.* | 116,751 | |||||||||
3,157 | MSC Industrial Direct Co., Class A | 153,935 | |||||||||
4,843 | Mueller Industries, Inc. | 156,768 | |||||||||
3,477 | Mueller Water Products, Inc. | 27,990 | |||||||||
10,313 | Mueller Water Products, Inc., Class B | 81,885 | |||||||||
1,618 | NACCO Industries, Inc., Class A | 145,458 | |||||||||
19,263 | Norfolk Southern Corp. | 1,147,690 | |||||||||
27,484 | Northrop Grumman Corp. | 2,021,998 | |||||||||
4,958 | Oshkosh Truck Corp. | 201,295 | |||||||||
20,412 | Owens Corning, Inc.* | 430,897 | |||||||||
27,872 | PACCAR, Inc. | 1,318,903 | |||||||||
4,732 | Pall Corp. | 164,532 | |||||||||
9,861 | Parker Hannifin Corp. | 787,401 | |||||||||
6,975 | Pentair, Inc. | 256,889 | |||||||||
20,991 | PHH Corp.* | 412,053 | |||||||||
17,934 | Pitney Bowes, Inc. | 647,597 | |||||||||
2,581 | Precision Castparts Corp. | 303,422 | |||||||||
20,337 | R.R. Donnelley & Sons Co. | 623,126 | |||||||||
24,339 | Raytheon Co. | 1,556,966 | |||||||||
8,557 | Republic Services, Inc. | 272,027 | |||||||||
6,315 | Robert Half International, Inc. | 149,666 | |||||||||
7,913 | Rockwell Automation, Inc. | 429,122 | |||||||||
5,533 | Rockwell Collins, Inc. | 349,188 | |||||||||
2,277 | Roper Industries, Inc. | 141,447 | |||||||||
6,786 | Ryder System, Inc. | 464,637 | |||||||||
3,474 | Shaw Group (The), Inc.* | 171,685 | |||||||||
5,587 | Skywest, Inc. | 106,321 | |||||||||
46,827 | Southwest Airlines Co. | 619,989 | |||||||||
5,224 | Spirit Aerosystems Holdings, Inc., Class A* | 152,384 | |||||||||
2,974 | SPX Corp. | 365,802 | |||||||||
9,844 | Steelcase, Inc., Class A | 109,072 | |||||||||
3,279 | Teleflex, Inc. | 180,640 | |||||||||
4,611 | Terex Corp.* | 321,294 | |||||||||
13,391 | Textron, Inc. | 816,985 | |||||||||
3,375 | Thomas & Betts Corp.* | 126,428 | |||||||||
8,856 | Timken (The) Co. | 320,144 | |||||||||
10,605 | Trane, Inc. | 493,239 | |||||||||
5,236 | Trinity Industries, Inc. | 159,174 | |||||||||
60,716 | Tyco International Ltd. (Bermuda) | 2,840,902 | |||||||||
28,193 | UAL Corp. | 420,076 | |||||||||
13,364 | Union Pacific Corp. | 1,940,319 | |||||||||
54,651 | United Parcel Service, Inc., Class B | 3,957,278 | |||||||||
13,492 | United Rentals, Inc.* | 254,189 | |||||||||
3,610 | United Stationers, Inc.* | 159,165 | |||||||||
44,218 | United Technologies Corp. | 3,204,477 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
5,983 | URS Corp.* | $ | 241,354 | ||||||||
7,497 | US Airways Group, Inc.* | 64,399 | |||||||||
7,707 | USG Corp.* | 272,134 | |||||||||
4,765 | W.W. Grainger, Inc. | 413,173 | |||||||||
37,577 | Waste Management, Inc. | 1,356,530 | |||||||||
5,257 | Werner Enterprises, Inc. | 102,249 | |||||||||
5,042 | WESCO International, Inc.* | 187,613 | |||||||||
28,678 | YRC Worldwide, Inc.* | 466,018 | |||||||||
95,110,387 | |||||||||||
Information Technology—9.9% | |||||||||||
25,300 | Accenture Ltd., Class A (Bermuda) | 950,015 | |||||||||
5,656 | Activision, Inc.* | 152,995 | |||||||||
9,777 | Adobe Systems, Inc.* | 364,584 | |||||||||
84,596 | Advanced Micro Devices, Inc.* | 504,192 | |||||||||
7,940 | Affiliated Computer Services, Inc., Class A* | 420,582 | |||||||||
11,215 | Agilent Technologies, Inc.* | 338,805 | |||||||||
2,261 | Alliance Data Systems Corp.* | 129,804 | |||||||||
9,755 | Altera Corp. | 207,586 | |||||||||
9,092 | Amdocs Ltd. (Guernsey)* | 285,307 | |||||||||
10,098 | Amkor Technology, Inc.* | 96,436 | |||||||||
3,303 | Amphenol Corp., Class A | 152,533 | |||||||||
12,563 | Analog Devices, Inc. | 404,654 | |||||||||
2,911 | Anixter International, Inc.* | 165,840 | |||||||||
12,464 | Apple, Inc.* | 2,168,113 | |||||||||
38,328 | Applied Materials, Inc. | 715,200 | |||||||||
17,327 | Arrow Electronics, Inc.* | 471,468 | |||||||||
38,674 | Atmel Corp.* | 143,867 | |||||||||
3,784 | Autodesk, Inc.* | 143,792 | |||||||||
27,131 | Automatic Data Processing, Inc. | 1,199,190 | |||||||||
18,771 | Avnet, Inc.* | 491,612 | |||||||||
4,741 | AVX Corp. | 62,439 | |||||||||
8,191 | Benchmark Electronics, Inc.* | 145,636 | |||||||||
4,829 | BMC Software, Inc.* | 167,856 | |||||||||
16,683 | Broadcom Corp., Class A* | 433,091 | |||||||||
8,493 | Broadridge Financial Solutions, Inc. | 158,140 | |||||||||
13,704 | CA, Inc. | 303,407 | |||||||||
2,573 | CACI International, Inc., Class A* | 128,959 | |||||||||
17,713 | Cadence Design Systems, Inc.* | 197,146 | |||||||||
7,890 | Check Point Software Technologies (Israel)* | 186,362 | |||||||||
160,890 | Cisco Systems, Inc.* | 4,125,220 | |||||||||
4,431 | Citrix Systems, Inc.* | 145,115 | |||||||||
25,616 | Computer Sciences Corp.* | 1,116,601 | |||||||||
15,496 | Compuware Corp.* | 116,840 | |||||||||
15,943 | Convergys Corp.* | 250,624 | |||||||||
27,796 | Corning, Inc. | 742,431 | |||||||||
123,795 | Dell, Inc.* | 2,306,301 | |||||||||
8,017 | Diebold, Inc. | 314,266 | |||||||||
2,900 | DST Systems, Inc.* | 173,536 | |||||||||
25,777 | eBay, Inc.* | 806,562 | |||||||||
8,752 | Electronic Arts, Inc.* | 450,465 |
See Notes to Financial Statements.
34
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1000 Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
77,002 | Electronic Data Systems Corp. | $ | 1,429,157 | ||||||||
69,593 | EMC Corp.* | 1,071,732 | |||||||||
10,333 | Fairchild Semiconductor International, Inc., Class A* | 134,742 | |||||||||
10,050 | Fidelity National Information Services, Inc. | 362,403 | |||||||||
7,421 | Fiserv, Inc.* | 375,132 | |||||||||
95,874 | Flextronics International Ltd. (Singapore)* | 996,131 | |||||||||
2,070 | Google, Inc., Class A* | 1,188,780 | |||||||||
4,915 | Harris Corp. | 265,557 | |||||||||
5,056 | Hewitt Associates, Inc., Class A* | 207,296 | |||||||||
110,784 | Hewlett-Packard Co. | 5,134,838 | |||||||||
51,690 | Ingram Micro, Inc., Class A* | 879,247 | |||||||||
8,852 | Insight Enterprises, Inc.* | 106,755 | |||||||||
13,951 | Integrated Device Technology, Inc.* | 149,136 | |||||||||
275,360 | Intel Corp. | 6,129,514 | |||||||||
58,104 | International Business Machines Corp. | 7,013,153 | |||||||||
3,852 | International Rectifier Corp.* | 87,672 | |||||||||
5,741 | Intersil Corp., Class A | 153,400 | |||||||||
10,855 | Intuit, Inc.* | 292,759 | |||||||||
7,810 | Iron Mountain, Inc.* | 214,541 | |||||||||
27,861 | Jabil Circuit, Inc. | 303,128 | |||||||||
15,957 | Juniper Networks, Inc.* | 440,732 | |||||||||
6,443 | KLA-Tencor Corp. | 281,430 | |||||||||
3,628 | Lam Research Corp.* | 148,168 | |||||||||
10,574 | Lexmark International, Inc., Class A* | 331,918 | |||||||||
7,170 | Linear Technology Corp. | 250,663 | |||||||||
36,588 | LSI Corp.* | 226,846 | |||||||||
16,454 | Marvell Technology Group Ltd. (Bermuda)* | 213,079 | |||||||||
1,346 | Mastercard, Inc., Class A | 374,403 | |||||||||
4,302 | McAfee, Inc.* | 143,042 | |||||||||
1,461 | MEMC Electronic Materials, Inc.* | 91,999 | |||||||||
8,596 | Metavante Technologies, Inc.* | 202,608 | |||||||||
1,202 | Mettler Toledo International, Inc.* | 114,503 | |||||||||
6,505 | Microchip Technology, Inc. | 239,059 | |||||||||
93,838 | Micron Technology, Inc.* | 724,429 | |||||||||
514,710 | Microsoft Corp. | 14,679,528 | |||||||||
4,740 | Molex, Inc. | 134,521 | |||||||||
3,967 | Molex, Inc., Class A | 102,825 | |||||||||
235,708 | Motorola, Inc. | 2,347,652 | |||||||||
12,638 | National Semiconductor Corp. | 257,689 | |||||||||
17,307 | NCR Corp.* | 426,271 | |||||||||
9,274 | NetApp, Inc.* | 224,431 | |||||||||
6,475 | Novellus Systems, Inc.* | 141,544 | |||||||||
11,095 | NVIDIA Corp.* | 228,002 | |||||||||
120,673 | Oracle Corp.* | 2,516,032 | |||||||||
12,857 | Paychex, Inc. | 467,609 | |||||||||
7,998 | Perot Systems Corp., Class A* | 125,089 | |||||||||
37,859 | QUALCOMM, Inc. | 1,635,130 | |||||||||
22,239 | SAIC, Inc.* | 422,541 | |||||||||
15,395 | SanDisk Corp.* | 417,051 | |||||||||
288,756 | Sanmina-SCI Corp.* | 447,572 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
30,924 | Seagate Technology (Cayman Islands) | $ | 583,536 | ||||||||
76,376 | Spansion, Inc., Class A* | 252,041 | |||||||||
45,235 | Sun Microsystems, Inc.* | 708,380 | |||||||||
48,854 | Symantec Corp.* | 841,266 | |||||||||
3,241 | SYNNEX Corp.* | 77,395 | |||||||||
6,207 | Synopsys, Inc.* | 143,444 | |||||||||
22,110 | Tech Data Corp.* | 743,117 | |||||||||
35,403 | Tellabs, Inc.* | 182,679 | |||||||||
10,104 | Teradyne, Inc.* | 134,282 | |||||||||
44,026 | Texas Instruments, Inc. | 1,283,798 | |||||||||
7,539 | Total System Services, Inc. | 179,428 | |||||||||
32,231 | Tyco Electronics Ltd. | 1,205,762 | |||||||||
63,285 | Unisys Corp.* | 263,266 | |||||||||
41,464 | Utstarcom, Inc.* | 134,758 | |||||||||
11,095 | VeriSign, Inc.* | 399,975 | |||||||||
31,434 | Vishay Intertechnology, Inc.* | 297,051 | |||||||||
9,395 | Western Digital Corp.* | 272,361 | |||||||||
13,428 | Western Union (The) Co. | 308,844 | |||||||||
85,352 | Xerox Corp. | 1,192,367 | |||||||||
9,586 | Xilinx, Inc. | 237,445 | |||||||||
20,432 | Yahoo!, Inc.* | 560,041 | |||||||||
86,690,247 | |||||||||||
Materials—3.7% | |||||||||||
19,081 | AbitibiBowater, Inc. | 188,329 | |||||||||
10,279 | Air Products & Chemicals, Inc. | 1,011,762 | |||||||||
2,567 | Airgas, Inc. | 123,550 | |||||||||
4,618 | AK Steel Holding Corp. | 289,918 | |||||||||
2,719 | Albemarle Corp. | 101,718 | |||||||||
57,103 | Alcoa, Inc. | 1,986,042 | |||||||||
2,624 | Allegheny Technologies, Inc. | 180,610 | |||||||||
3,035 | AptarGroup, Inc. | 133,995 | |||||||||
13,154 | Ashland, Inc. | 697,425 | |||||||||
6,746 | Ball Corp. | 362,800 | |||||||||
10,472 | Bemis Co., Inc. | 275,414 | |||||||||
6,403 | Cabot Corp. | 186,711 | |||||||||
1,873 | Carpenter Technology Corp. | 96,047 | |||||||||
6,947 | Celanese Corp., Series A | 310,878 | |||||||||
24,327 | Chemtura Corp. | 168,343 | |||||||||
9,288 | Commercial Metals Co. | 289,228 | |||||||||
14,125 | Crown Holdings, Inc.* | 379,115 | |||||||||
2,848 | Cytec Industries, Inc. | 168,060 | |||||||||
43,579 | Domtar Corp.* | 260,167 | |||||||||
96,784 | Dow Chemical (The) Co. | 3,885,877 | |||||||||
63,880 | E.I. du Pont de Nemours & Co. | 3,124,370 | |||||||||
7,554 | Eastman Chemical Co. | 555,219 | |||||||||
7,833 | Ecolab, Inc. | 360,005 | |||||||||
2,747 | FMC Corp. | 172,457 | |||||||||
7,353 | Freeport-McMoRan Copper & Gold, Inc., Class B | 836,404 | |||||||||
22,144 | Graphic Packaging Holding Co.* | 62,003 |
See Notes to Financial Statements.
35
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1000 Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
1,641 | Greif, Inc., Class A | $ | 106,009 | ||||||||
174 | Greif, Inc., Class B | 9,899 | |||||||||
7,731 | Hercules, Inc. | 145,343 | |||||||||
19,348 | Huntsman Corp. | 435,137 | |||||||||
4,385 | International Flavors & Fragrances, Inc. | 200,000 | |||||||||
56,513 | International Paper Co. | 1,478,945 | |||||||||
21,780 | Louisiana-Pacific Corp. | 250,688 | |||||||||
4,452 | Lubrizol (The) Corp. | 259,641 | |||||||||
1,741 | Martin Marietta Materials, Inc. | 190,431 | |||||||||
23,404 | MeadWestvaco Corp. | 615,525 | |||||||||
7,282 | Monsanto Co. | 830,294 | |||||||||
2,158 | Mosaic (The) Co.* | 264,377 | |||||||||
11,529 | Nalco Holding Co. | 265,052 | |||||||||
14,740 | Newmont Mining Corp. | 651,655 | |||||||||
14,254 | Nucor Corp. | 1,076,177 | |||||||||
7,784 | Olin Corp. | 157,003 | |||||||||
6,458 | Owens-Illinois, Inc.* | 356,159 | |||||||||
5,876 | Packaging Corp. of America | 129,154 | |||||||||
9,605 | Pactiv Corp.* | 228,503 | |||||||||
14,414 | PPG Industries, Inc. | 884,587 | |||||||||
10,069 | Praxair, Inc. | 919,400 | |||||||||
3,603 | Reliance Steel & Aluminum Co. | 218,990 | |||||||||
4,918 | Rockwood Holdings, Inc.* | 181,523 | |||||||||
9,822 | Rohm & Haas Co. | 524,986 | |||||||||
10,859 | RPM International, Inc. | 242,156 | |||||||||
5,221 | Scotts Miracle-Gro (The) Co., Class A | 173,024 | |||||||||
11,024 | Sealed Air Corp. | 278,797 | |||||||||
3,551 | Sigma-Aldrich Corp. | 202,478 | |||||||||
2,027 | Silgan Holdings, Inc. | 107,999 | |||||||||
43,813 | Smurfit-Stone Container Corp.* | 237,905 | |||||||||
9,742 | Sonoco Products Co. | 320,999 | |||||||||
2,832 | Southern Copper Corp. | 325,000 | |||||||||
4,562 | Steel Dynamics, Inc. | 158,986 | |||||||||
27,801 | Temple-Inland, Inc. | 324,438 | |||||||||
6,232 | United States Steel Corp. | 959,416 | |||||||||
1,530 | Valhi, Inc. | 40,713 | |||||||||
8,806 | Valspar (The) Corp. | 193,556 | |||||||||
5,081 | Vulcan Materials Co. | 349,674 | |||||||||
2,405 | Westlake Chemical Corp. | 40,188 | |||||||||
26,861 | Weyerhaeuser Co. | 1,715,881 | |||||||||
10,996 | Worthington Industries, Inc. | 198,038 | |||||||||
32,455,173 | |||||||||||
Telecommunication Services—4.1% | |||||||||||
8,884 | American Tower Corp., Class A* | 385,743 | |||||||||
358,465 | AT&T, Inc. | 13,876,179 | |||||||||
10,749 | CenturyTel, Inc. | 348,805 | |||||||||
53,059 | Citizens Communications Co. | 568,792 | |||||||||
2,630 | Crown Castle International Corp.* | 102,176 | |||||||||
13,425 | Embarq Corp. | 558,077 | |||||||||
2,921 | Leap Wireless International, Inc.* | 156,186 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
94,173 | Level 3 Communications, Inc.* | $ | 279,694 | ||||||||
5,016 | NII Holdings, Inc.* | 229,432 | |||||||||
199,598 | Qwest Communications International, Inc. | 1,029,926 | |||||||||
591,708 | Sprint Nextel Corp. | 4,727,747 | |||||||||
4,290 | Telephone & Data Systems, Inc. | 164,307 | |||||||||
4,691 | Telephone & Data Systems, Inc., Special Shares | 170,049 | |||||||||
4,546 | US Cellular Corp.* | 250,712 | |||||||||
326,350 | Verizon Communications, Inc. | 12,557,948 | |||||||||
15,827 | Windstream Corp. | 185,809 | |||||||||
35,591,582 | |||||||||||
Utilities—5.7% | |||||||||||
62,782 | AES (The) Corp.* | 1,089,896 | |||||||||
7,396 | AGL Resources, Inc. | 251,464 | |||||||||
5,229 | Allegheny Energy, Inc. | 281,320 | |||||||||
3,725 | ALLETE, Inc. | 155,593 | |||||||||
11,870 | Alliant Energy Corp. | 447,143 | |||||||||
25,864 | Ameren Corp. | 1,173,191 | |||||||||
45,260 | American Electric Power Co., Inc. | 2,019,954 | |||||||||
6,690 | Aqua America, Inc. | 123,297 | |||||||||
13,140 | Atmos Energy Corp. | 363,715 | |||||||||
6,952 | Avista Corp. | 142,725 | |||||||||
3,587 | Black Hills Corp. | 139,929 | |||||||||
46,875 | CenterPoint Energy, Inc. | 713,438 | |||||||||
5,590 | Cleco Corp. | 134,216 | |||||||||
30,033 | CMS Energy Corp. | 437,881 | |||||||||
34,102 | Consolidated Edison, Inc. | 1,418,643 | |||||||||
10,546 | Constellation Energy Group, Inc. | 892,719 | |||||||||
58,544 | Dominion Resources, Inc. | 2,540,224 | |||||||||
7,330 | DPL, Inc. | 203,994 | |||||||||
24,272 | DTE Energy Co. | 978,404 | |||||||||
183,973 | Duke Energy Corp. | 3,368,546 | |||||||||
31,973 | Dynegy, Inc., Class A* | 275,607 | |||||||||
25,429 | Edison International | 1,326,631 | |||||||||
2,646 | Energen Corp. | 180,563 | |||||||||
20,184 | Energy East Corp. | 460,195 | |||||||||
12,885 | Entergy Corp. | 1,479,971 | |||||||||
3,392 | Equitable Resources, Inc. | 225,127 | |||||||||
32,688 | Exelon Corp. | 2,794,170 | |||||||||
25,843 | FirstEnergy Corp. | 1,954,765 | |||||||||
26,210 | FPL Group, Inc. | 1,737,461 | |||||||||
11,745 | Great Plains Energy, Inc. | 301,142 | |||||||||
11,062 | Hawaiian Electric Industries, Inc. | 272,678 | |||||||||
5,331 | IDACORP, Inc. | 172,938 | |||||||||
6,630 | Integrys Energy Group, Inc. | 317,511 | |||||||||
12,929 | MDU Resources Group, Inc. | 373,260 | |||||||||
12,852 | Mirant Corp.* | 528,346 | |||||||||
6,150 | National Fuel Gas Co. | 314,757 | |||||||||
5,349 | New Jersey Resources Corp. | 170,366 | |||||||||
6,878 | Nicor, Inc. | 241,555 |
See Notes to Financial Statements.
36
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1000 Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
48,843 | NiSource, Inc. | $ | 874,290 | ||||||||
17,901 | Northeast Utilities | 471,154 | |||||||||
12,772 | NRG Energy, Inc.* | 561,329 | |||||||||
11,984 | NSTAR | 386,005 | |||||||||
11,038 | OGE Energy Corp. | 360,832 | |||||||||
9,811 | ONEOK, Inc. | 472,105 | |||||||||
26,267 | Pepco Holdings, Inc. | 654,311 | |||||||||
37,767 | PG&E Corp. | 1,510,680 | |||||||||
6,858 | Piedmont Natural Gas Co., Inc. | 180,297 | |||||||||
14,599 | Pinnacle West Capital Corp. | 495,490 | |||||||||
16,487 | PNM Resources, Inc. | 238,897 | |||||||||
8,318 | Portland General Electric Co. | 199,632 | |||||||||
21,531 | PPL Corp. | 1,033,919 | |||||||||
35,051 | Progress Energy, Inc. | 1,471,791 | |||||||||
33,484 | Public Service Enterprise Group, Inc. | 1,470,282 | |||||||||
12,814 | Puget Energy, Inc. | 348,669 | |||||||||
5,644 | Questar Corp. | 350,097 | |||||||||
27,635 | Reliant Energy, Inc.* | 711,325 | |||||||||
13,307 | SCANA Corp. | 524,695 | |||||||||
19,645 | Sempra Energy | 1,113,282 | |||||||||
19,446 | Sierra Pacific Resources | 265,049 | |||||||||
70,688 | Southern (The) Co. | 2,631,714 | |||||||||
6,523 | Southern Union Co. | 167,119 | |||||||||
5,815 | Southwest Gas Corp. | 167,879 | |||||||||
27,290 | TECO Energy, Inc. | 436,913 | |||||||||
11,804 | UGI Corp. | 306,904 | |||||||||
5,521 | Unisource Energy Corp. | 172,476 | |||||||||
8,829 | Vectren Corp. | 249,684 | |||||||||
10,812 | Westar Energy, Inc. | 250,730 | |||||||||
6,671 | WGL Holdings, Inc. | 218,809 | |||||||||
9,922 | Wisconsin Energy Corp. | 470,898 | |||||||||
55,899 | Xcel Energy, Inc. | 1,162,699 | |||||||||
49,933,291 | |||||||||||
Total Common Stocks and Other Equity Interests (Cost $958,123,506) | 876,755,977 | ||||||||||
Money Market Fund—0.2% | |||||||||||
1,684,301 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $1,684,301) | 1,684,301 | |||||||||
Total Investments (Cost $959,807,807)—100.2% | 878,440,278 | ||||||||||
Liabilities in excess of other assets—(0.2%) | (1,476,541 | ) | |||||||||
Net Assets—100.0% | $ | 876,963,737 |
REIT Real Estate Investment Trust
* Non-income producing security.
See Notes to Financial Statements.
37
Schedule of Investments
PowerShares NASDAQ NextQ Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.9% | |||||||||||
Consumer Discretionary—16.9% | |||||||||||
558 | Central European Media Enterprises Ltd., Class A (Bermuda)* | $ | 59,159 | ||||||||
1,279 | CROCS, Inc.* | 13,059 | |||||||||
1,026 | Ctrip.com International Ltd. ADR (China) | 63,674 | |||||||||
1,426 | Dollar Tree, Inc.* | 45,062 | |||||||||
1,790 | O'Reilly Automotive, Inc.* | 51,677 | |||||||||
597 | priceline.com, Inc.* | 76,201 | |||||||||
2,101 | Ross Stores, Inc. | 70,362 | |||||||||
2,576 | Urban Outfitters, Inc.* | 88,228 | |||||||||
467,422 | |||||||||||
Energy—2.4% | |||||||||||
2,389 | Patterson-UTI Energy, Inc. | 66,749 | |||||||||
Health Care—36.1% | |||||||||||
1,510 | BioMarin Pharmaceutical, Inc.* | 55,055 | |||||||||
1,247 | Cerner Corp.* | 57,699 | |||||||||
2,080 | Endo Pharmaceuticals Holdings, Inc.* | 51,646 | |||||||||
837 | Gen-Probe, Inc.* | 47,173 | |||||||||
945 | Idexx Laboratories, Inc.* | 50,274 | |||||||||
864 | Illumina, Inc.* | 67,297 | |||||||||
1,339 | ImClone Systems, Inc.* | 62,464 | |||||||||
717 | Invitrogen Corp.* | 67,090 | |||||||||
5,038 | Millennium Pharmaceuticals, Inc.* | 125,295 | |||||||||
859 | Onyx Pharmaceuticals, Inc.* | 30,202 | |||||||||
1,444 | Perrigo Co. | 59,190 | |||||||||
1,851 | Pharmaceutical Product Development, Inc. | 76,668 | |||||||||
2,988 | Qiagen N.V. (Netherlands)* | 66,363 | |||||||||
1,737 | Sepracor, Inc.* | 37,432 | |||||||||
987 | Shire PLC ADR (United Kingdom) | 54,226 | |||||||||
605 | Techne Corp.* | 43,875 | |||||||||
1,314 | VCA Antech, Inc.* | 42,534 | |||||||||
994,483 | |||||||||||
Industrials—16.4% | |||||||||||
1,443 | BE Aerospace, Inc.* | 58,239 | |||||||||
581 | Bucyrus International, Inc., Class A | 73,166 | |||||||||
1,367 | Copart, Inc.* | 55,869 | |||||||||
634 | DryShips, Inc. (Greece) | 52,305 | |||||||||
1,934 | J.B. Hunt Transport Services, Inc. | 65,698 | |||||||||
814 | Landstar System, Inc. | 42,295 | |||||||||
666 | Lincoln Electric Holdings, Inc. | 50,816 | |||||||||
618 | Sunpower Corp., Class A* | 53,933 | |||||||||
452,321 | |||||||||||
Information Technology—21.4% | |||||||||||
1,215 | Ansys, Inc.* | 48,879 | |||||||||
1,529 | ASML Holding N.V. (Netherlands) | 43,362 | |||||||||
5,832 | Brocade Communications Systems, Inc.* | 41,757 | |||||||||
568 | Equinix, Inc.* | 51,359 | |||||||||
2,129 | FLIR Systems, Inc.* | 73,090 | |||||||||
1,965 | Intersil Corp., Class A | 52,505 | |||||||||
476 | Itron, Inc.* | 44,306 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
3,242 | Nuance Communications, Inc.* | $ | 65,748 | ||||||||
2,195 | Synopsys, Inc.* | 50,726 | |||||||||
2,234 | Telefonaktiebolaget LM Ericsson ADR (Sweden) | 56,341 | |||||||||
1,879 | Trimble Navigation Ltd.* | 61,612 | |||||||||
589,685 | |||||||||||
Materials—3.1% | |||||||||||
1,253 | Pan American Silver Corp. (Canada)* | 41,976 | |||||||||
979 | Randgold Resources Ltd. ADR (Channel Islands) | 44,564 | |||||||||
86,540 | |||||||||||
Telecommunication Services—3.6% | |||||||||||
1,682 | SBA Communications Corp., Class A* | 54,396 | |||||||||
2,278 | Time Warner Telecom, Inc., Class A* | 44,649 | |||||||||
99,045 | |||||||||||
Total Common Stocks (Cost $2,627,589) | 2,756,245 | ||||||||||
Money Market Fund—0.1% | |||||||||||
2,952 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $2,952) | 2,952 | |||||||||
Total Investments (Cost $2,630,541)—100.0% | 2,759,197 | ||||||||||
Liabilities in excess of other assets—(0.0%) | (1,079 | ) | |||||||||
Net Assets—100.0% | $ | 2,758,118 |
ADR American Depositary Receipt
* Non-income producing security.
See Notes to Financial Statements.
38
Statements of Assets and Liabilities
April 30, 2008
PowerShares Dynamic MagniQuant Portfolio | PowerShares Dynamic Market Portfolio | PowerShares Dynamic OTC Portfolio | PowerShares FTSE RAFI US 1000 Portfolio | PowerShares NASDAQ NextQ Portfolio | |||||||||||||||||||
ASSETS: | |||||||||||||||||||||||
Investments at value | $ | 62,976,933 | $ | 621,488,061 | $ | 96,059,319 | $ | 878,440,278 | $ | 2,759,197 | |||||||||||||
Cash | — | — | 209,926 | — | — | ||||||||||||||||||
Receivables: | |||||||||||||||||||||||
Dividends | 12,409 | 279,703 | 5,328 | 873,448 | 1,034 | ||||||||||||||||||
Expense waivers due from Adviser | — | — | 3,329 | — | — | ||||||||||||||||||
Investments sold | — | 4,865,902 | 2,361,897 | 2,768,732 | 390,275 | ||||||||||||||||||
Total Assets | 62,989,342 | 626,633,666 | 98,639,799 | 882,082,458 | 3,150,506 | ||||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||
Due to custodian | 204,841 | 711,419 | — | 181,560 | 760 | ||||||||||||||||||
Payables: | |||||||||||||||||||||||
Investments purchased | — | — | — | 4,377,029 | 389,707 | ||||||||||||||||||
Shares repurchased | — | 4,849,666 | 2,362,094 | — | — | ||||||||||||||||||
Expense recapture due to Adviser | 10,237 | — | — | — | — | ||||||||||||||||||
Accrued advisory fees | 26,080 | 254,130 | 39,689 | 355,992 | 1,921 | ||||||||||||||||||
Accrued expenses | 47,786 | 115,882 | 51,468 | 204,140 | — | ||||||||||||||||||
Total Liabilities | 288,944 | 5,931,097 | 2,453,251 | 5,118,721 | 392,388 | ||||||||||||||||||
NET ASSETS | $ | 62,700,398 | $ | 620,702,569 | $ | 96,186,548 | $ | 876,963,737 | $ | 2,758,118 | |||||||||||||
NET ASSETS CONSIST OF: | |||||||||||||||||||||||
Shares of beneficial interest | $ | 74,618,420 | $ | 805,441,238 | $ | 152,858,268 | $ | 974,007,158 | $ | 2,641,030 | |||||||||||||
Undistributed net investment income | — | 260,485 | — | 3,869,539 | 2,563 | ||||||||||||||||||
Accumulated net realized loss on investments | (11,553,122 | ) | (185,165,937 | ) | (55,757,525 | ) | (19,545,431 | ) | (14,131 | ) | |||||||||||||
Net unrealized appreciation (depreciation) on investments | (364,900 | ) | 166,783 | (914,195 | ) | (81,367,529 | ) | 128,656 | |||||||||||||||
Net Assets | $ | 62,700,398 | $ | 620,702,569 | $ | 96,186,548 | $ | 876,963,737 | $ | 2,758,118 | |||||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 2,500,000 | 12,900,000 | 2,050,000 | 15,900,000 | 100,000 | ||||||||||||||||||
Net asset value | $ | 25.08 | $ | 48.12 | $ | 46.92 | $ | 55.15 | $ | 27.58 | |||||||||||||
Investments at cost | $ | 63,341,833 | $ | 621,321,278 | $ | 96,973,514 | $ | 959,807,807 | $ | 2,630,541 |
See Notes to Financial Statements.
39
Statements of Operations
PowerShares Dynamic MagniQuant Portfolio | PowerShares Dynamic Market Portfolio | PowerShares Dynamic OTC Portfolio | PowerShares FTSE RAFI US 1000 Portfolio | PowerShares NASDAQ NextQ Portfolio | |||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | For the Period April 1, 2008* Through April 30, 2008 | |||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||
Unaffiliated dividend income | $ | 1,004,580 | $ | 10,564,925 | $ | 514,843 | $ | 22,929,822 | $ | 4,484 | |||||||||||||
Affiliated money market dividend income | — | 11,254 | — | 89,786 | — | ||||||||||||||||||
Foreign withholding taxes | — | — | — | (4,170 | ) | — | |||||||||||||||||
Total Income | 1,004,580 | 10,576,179 | 514,843 | 23,015,438 | 4,484 | ||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||
Advisory fees | 417,512 | 4,065,649 | 680,569 | 5,311,535 | 1,921 | ||||||||||||||||||
Accounting & Administration fees | 74,658 | 234,684 | 80,738 | 305,049 | — | ||||||||||||||||||
Sub-licensing | 41,751 | 243,939 | 40,834 | 1,062,306 | — | ||||||||||||||||||
Offering costs | 17,886 | — | — | — | — | ||||||||||||||||||
Audit | 15,848 | 15,848 | 15,848 | 15,848 | — | ||||||||||||||||||
Custodian & transfer agent fees | 7,636 | 47,275 | 11,258 | 59,254 | — | ||||||||||||||||||
Trustees | 6,840 | 27,240 | 8,076 | 33,795 | — | ||||||||||||||||||
Printing | 2,249 | 27,192 | 2,101 | 45,661 | — | ||||||||||||||||||
Legal | 1,895 | 34,284 | 2,428 | 46,147 | — | ||||||||||||||||||
Registration & filings | 249 | — | — | 3,540 | — | ||||||||||||||||||
Listing fee and expenses | 138 | 9,967 | 8,652 | 1,677 | — | ||||||||||||||||||
Other expenses | 14,199 | 62,139 | 18,408 | 70,443 | — | ||||||||||||||||||
Total Expenses | 600,861 | 4,768,217 | 868,912 | 6,955,255 | 1,921 | ||||||||||||||||||
(Waivers) and/or Recapture | (40,209 | ) | (48,609 | ) | (66,557 | ) | 118,831 | — | |||||||||||||||
Net Expenses | 560,652 | 4,719,608 | 802,355 | 7,074,086 | 1,921 | ||||||||||||||||||
Net Investment Income (Loss) | 443,928 | 5,856,571 | (287,512 | ) | 15,941,352 | 2,563 | |||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||||||||||
Net realized gain (loss) from: | |||||||||||||||||||||||
Investments | (10,685,671 | ) | (78,624,592 | ) | (16,773,473 | ) | (18,838,075 | ) | (14,131 | ) | |||||||||||||
In-kind redemptions | 4,919,417 | 66,200,285 | 7,886,782 | 55,026,135 | 86,234 | ||||||||||||||||||
Net realized gain (loss) | (5,766,254 | ) | (12,424,307 | ) | (8,886,691 | ) | 36,188,060 | 72,103 | |||||||||||||||
Net change in unrealized appreciation/ depreciation on investments | (3,680,252 | ) | (71,794,455 | ) | (11,624,860 | ) | (145,734,972 | ) | 128,656 | ||||||||||||||
Net realized and unrealized gain (loss) on investments | (9,446,506 | ) | (84,218,762 | ) | (20,511,551 | ) | (109,546,912 | ) | 200,759 | ||||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | (9,002,578 | ) | $ | (78,362,191 | ) | $ | (20,799,063 | ) | $ | (93,605,560 | ) | $ | 203,322 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
40
This page intentionally left blank
Statements of Changes in Net Assets
PowerShares Dynamic MagniQuant Portfolio | PowerShares Dynamic Market Portfolio | ||||||||||||||||||
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||
OPERATIONS: | |||||||||||||||||||
Net investment income (loss) | $ | 443,928 | $ | 303,423 | $ | 5,856,571 | $ | 8,003,691 | |||||||||||
Net realized gain (loss) on investments | (5,766,254 | ) | 1,471,982 | (12,424,307 | ) | 66,688,243 | |||||||||||||
Net change in unrealized appreciation/depreciation of investments | (3,680,252 | ) | 3,315,352 | (71,794,455 | ) | 29,944,772 | |||||||||||||
Net increase (decrease) in net assets resulting from operations | (9,002,578 | ) | 5,090,757 | (78,362,191 | ) | 104,636,706 | |||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 7,967 | 34,154 | (101,862 | ) | 4,323 | ||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||
Net investment income | (640,462 | ) | (106,889 | ) | (7,990,684 | ) | (6,116,430 | ) | |||||||||||
Return of capital | (18,785 | ) | — | — | — | ||||||||||||||
Total distributions | (659,247 | ) | (106,889 | ) | (7,990,684 | ) | (6,116,430 | ) | |||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||
Proceeds from shares sold | 132,508,418 | 118,994,387 | 1,125,461,970 | 1,426,914,403 | |||||||||||||||
Value of shares repurchased | (141,415,198 | ) | (42,709,252 | ) | (1,391,511,138 | ) | (1,471,486,113 | ) | |||||||||||
Net income equalization | (7,967 | ) | (34,154 | ) | 101,862 | (4,323 | ) | ||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | (8,914,747 | ) | 76,250,981 | (265,947,306 | ) | (44,576,033 | ) | ||||||||||||
Increase (Decrease) in Net Assets | (18,568,605 | ) | 81,269,003 | (352,402,043 | ) | 53,948,566 | |||||||||||||
NET ASSETS: | |||||||||||||||||||
Beginning of period | 81,269,003 | — | 973,104,612 | 919,156,046 | |||||||||||||||
End of period | $ | 62,700,398 | $ | 81,269,003 | $ | 620,702,569 | $ | 973,104,612 | |||||||||||
Undistributed net investment income at end of period | $ | — | $ | 196,534 | $ | 260,485 | $ | 2,394,598 | |||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||
Shares sold | 4,900,000 | 4,500,000 | 21,800,000 | 29,700,000 | |||||||||||||||
Shares repurchased | (5,300,000 | ) | (1,600,000 | ) | (27,150,000 | ) | (30,650,000 | ) | |||||||||||
Shares outstanding, beginning of period | 2,900,000 | — | 18,250,000 | 19,200,000 | |||||||||||||||
Shares outstanding, end of period | 2,500,000 | 2,900,000 | 12,900,000 | 18,250,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
42
PowerShares Dynamic OTC Portfolio | PowerShares FTSE RAFI US 1000 Portfolio | PowerShares NASDAQ NextQ Portfolio | |||||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | For the Period April 1, 2008* Through April 30, 2008 | |||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||
Net investment income (loss) | $ | (287,512 | ) | $ | (265,225 | ) | $ | 15,941,352 | $ | 6,345,432 | $ | 2,563 | |||||||||||
Net realized gain (loss) on investments | (8,886,691 | ) | 7,164,567 | 36,188,060 | 20,651,459 | 72,103 | |||||||||||||||||
Net change in unrealized appreciation/depreciation of investments | (11,624,860 | ) | (5,390,297 | ) | (145,734,972 | ) | 61,838,256 | 128,656 | |||||||||||||||
Net increase (decrease) in net assets resulting from operations | (20,799,063 | ) | 1,509,045 | (93,605,560 | ) | 88,835,147 | 203,322 | ||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | (18,011 | ) | 91,702 | (721,388 | ) | 2,687,242 | (1,245 | ) | |||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||
Net investment income | — | — | (13,733,870 | ) | (4,798,111 | ) | — | ||||||||||||||||
Return of capital | (137,064 | ) | — | — | — | — | |||||||||||||||||
Total distributions | (137,064 | ) | — | (13,733,870 | ) | (4,798,111 | ) | — | |||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||
Proceeds from shares sold | 238,637,254 | 259,930,591 | 359,656,795 | 1,023,566,925 | 5,205,900 | ||||||||||||||||||
Value of shares repurchased | (281,113,524 | ) | (324,280,921 | ) | (430,542,238 | ) | (157,298,357 | ) | (2,651,104 | ) | |||||||||||||
Net income equalization | 18,011 | (91,702 | ) | 721,388 | (2,687,242 | ) | 1,245 | ||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | (42,458,259 | ) | (64,442,032 | ) | (70,164,055 | ) | 863,581,326 | 2,556,041 | |||||||||||||||
Increase (Decrease) in Net Assets | (63,412,397 | ) | (62,841,285 | ) | (178,224,873 | ) | 950,305,604 | 2,758,118 | |||||||||||||||
NET ASSETS: | |||||||||||||||||||||||
Beginning of period | 159,598,945 | 222,440,230 | 1,055,188,610 | 104,883,006 | — | ||||||||||||||||||
End of period | $ | 96,186,548 | $ | 159,598,945 | $ | 876,963,737 | $ | 1,055,188,610 | $ | 2,758,118 | |||||||||||||
Undistributed net investment income at end of period | $ | — | $ | — | $ | 3,869,539 | $ | 1,674,587 | $ | 2,563 | |||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||
Shares sold | 4,550,000 | 5,150,000 | 6,000,000 | 18,000,000 | 200,000 | ||||||||||||||||||
Shares repurchased | (5,400,000 | ) | (6,400,000 | ) | (7,400,000 | ) | (2,700,000 | ) | (100,000 | ) | |||||||||||||
Shares outstanding, beginning of period | 2,900,000 | 4,150,000 | 17,300,000 | 2,000,000 | — | ||||||||||||||||||
Shares outstanding, end of period | 2,050,000 | 2,900,000 | 15,900,000 | 17,300,000 | 100,000 |
43
Financial Highlights
PowerShares Dynamic MagniQuant Portfolio
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 28.02 | $ | 25.37 | |||||||
Net investment income** | 0.14 | 0.15 | |||||||||
Net realized and unrealized gain (loss) on investments | (2.87 | ) | 2.55 | ||||||||
Total from operations | (2.73 | ) | 2.70 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.20 | ) | (0.05 | ) | |||||||
Return of capital | (0.01 | ) | — | ||||||||
Total distributions | (0.21 | ) | (0.05 | ) | |||||||
Net asset value at end of period | $ | 25.08 | $ | 28.02 | |||||||
TOTAL RETURN*** | (9.81 | )% | 10.67 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 62,700 | $ | 81,269 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.67 | % | 0.67 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.72 | % | 0.84 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.53 | % | 1.04 | %† | |||||||
Portfolio turnover rate †† | 76 | % | 23 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | — | (a) | $ | 0.02 |
PowerShares Dynamic Market Portfolio
Year Ended April 30, | For the Year May 1, 2003* Through | ||||||||||||||||||||||
2008 | 2007 | 2006 | 2005 | April 30, 2004 | |||||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||||||||||
Net asset value at beginning of period | $ | 53.32 | $ | 47.87 | $ | 39.11 | $ | 35.05 | $ | 26.99 | ††† | ||||||||||||
Net investment income** | 0.37 | 0.42 | 0.34 | 0.26 | 0.15 | ††† | |||||||||||||||||
Net realized and unrealized gain (loss) on investments | (5.09 | ) | 5.35 | 8.75 | 4.02 | 8.09 | ††† | ||||||||||||||||
Total from operations . | (4.72 | ) | 5.77 | 9.09 | 4.28 | 8.24 | ††† | ||||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||||||
Net investment income | (0.48 | ) | (0.32 | ) | (0.33 | ) | (0.22 | ) | (0.18 | )††† | |||||||||||||
Net asset value at end of period | $ | 48.12 | $ | 53.32 | $ | 47.87 | $ | 39.11 | $ | 35.05 | |||||||||||||
TOTAL RETURN*** | (8.93 | )% | 12.12 | % | 23.30 | % | 12.23 | % | 30.50 | % | |||||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||||||
Net assets at end of period (000's omitted) . | $ | 620,703 | $ | 973,105 | $ | 919,156 | $ | 283,620 | $ | 85,946 | |||||||||||||
Ratio to average net assets of: | |||||||||||||||||||||||
Expenses, after Waivers and/or Recapture | 0.58 | % | 0.60 | % | 0.60 | % | 0.60 | % | 0.60 | % | |||||||||||||
Expenses, prior to Waivers and/or Recapture | 0.59 | % | 0.62 | % | 0.63 | % | 0.70 | % | 1.26 | % | |||||||||||||
Net investment income, after Waivers and/or Recapture | 0.72 | % | 0.87 | % | 0.76 | % | 0.68 | % | 0.46 | % | |||||||||||||
Portfolio turnover rate †† | 121 | % | 114 | % | 103 | % | 94 | % | 58 | % | |||||||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.01 | ) | $ | — | (a) | — | — | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
††† Per share amounts have been adjusted for 4 for 1 stock split.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
44
Financial Highlights (Continued)
PowerShares Dynamic OTC Portfolio
Year Ended April 30, | For the Year May 1, 2003* Through | ||||||||||||||||||||||
2008 | 2007 | 2006 | 2005 | April 30, 2004 | |||||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||||||||||
Net asset value at beginning of period | $ | 55.03 | $ | 53.60 | $ | 42.38 | $ | 36.59 | $ | 28.57 | ††† | ||||||||||||
Net investment income (loss)** | (0.11 | ) | (0.07 | ) | (0.02 | ) | (0.03 | ) | (0.04 | )††† | |||||||||||||
Net realized and unrealized gain (loss) on investments | (7.94 | ) | 1.50 | 11.30 | 5.82 | 8.06 | ††† | ||||||||||||||||
Total from operations | (8.05 | ) | 1.43 | 11.28 | 5.79 | 8.02 | ††† | ||||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||||||
Net investment income | — | — | (0.02 | ) | — | — | |||||||||||||||||
Return of capital | (0.06 | ) | — | (0.04 | ) | — | — | ||||||||||||||||
Total distributions | (0.06 | ) | — | (0.06 | ) | — | — | ||||||||||||||||
Net asset value at end of period | $ | 46.92 | $ | 55.03 | $ | 53.60 | $ | 42.38 | $ | 36.59 | |||||||||||||
TOTAL RETURN*** | (14.65 | )% | 2.67 | % | 26.63 | % | 15.81 | % | 28.07 | % | |||||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||||||
Net assets at end of period (000's omitted) | $ | 96,187 | $ | 159,599 | $ | 222,440 | $ | 65,747 | $ | 34,817 | |||||||||||||
Ratio to average net assets of: | |||||||||||||||||||||||
Expenses, after Waivers and/or Recapture | 0.59 | % | 0.60 | % | 0.60 | % | 0.60 | % | 0.60 | % | |||||||||||||
Expenses, prior to Waivers and/or Recapture | 0.64 | % | 0.69 | % | 0.69 | % | 1.06 | % | 1.66 | % | |||||||||||||
Net investment income (loss), after Waivers and/or Recapture | (0.21 | )% | (0.15 | )% | (0.04 | )% | (0.06 | )% | (0.10 | )% | |||||||||||||
Portfolio turnover rate †† | 60 | % | 107 | % | 77 | % | 112 | % | 79 | % | |||||||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.01 | ) | $ | 0.03 | — | — | — |
PowerShares FTSE RAFI US 1000 Portfolio
Year Ended April 30, | For the Period December 19, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 60.99 | $ | 52.44 | $ | 49.64 | |||||||||
Net investment income** | 0.89 | 0.78 | 0.24 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (5.96 | ) | 8.38 | 2.68 | |||||||||||
Total from operations | (5.07 | ) | 9.16 | 2.92 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.77 | ) | (0.61 | ) | (0.12 | ) | |||||||||
Net asset value at end of period | $ | 55.15 | $ | 60.99 | $ | 52.44 | |||||||||
TOTAL RETURN*** | (8.42 | )% | 17.60 | % | 5.89 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 876,964 | $ | 1,055,189 | $ | 104,883 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.67 | % | 0.70 | % | 0.76 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.66 | % | 0.71 | % | 1.00 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 1.50 | % | 1.40 | % | 1.38 | %† | |||||||||
Portfolio turnover rate †† | 12 | % | 8 | % | 2 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.04 | ) | $ | 0.33 | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
††† Per share amounts have been adjusted for 4 for 1 split.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
See Notes to Financial Statements.
45
Financial Highlights (Continued)
PowerShares NASDAQ NextQ Portfolio
For the Period April 1, 2008* Through April 30, 2008 | |||||||
PER SHARE OPERATING PERFORMANCE: | |||||||
Net asset value at beginning of period | $ | 25.77 | |||||
Net investment income** | 0.03 | ||||||
Net realized and unrealized gain on investments | 1.78 | ||||||
Total from operations | 1.81 | ||||||
Net asset value at end of period | $ | 27.58 | |||||
TOTAL RETURN*** | 7.02 | %(a) | |||||
RATIOS/SUPPLEMENTAL DATA: | |||||||
Net assets at end of period (000's omitted) | $ | 2,758 | |||||
Ratio to average net assets of: | |||||||
Expenses | 0.70 | %† | |||||
Net investment income | 0.93 | %† | |||||
Portfolio turnover rate †† | 15 | % | |||||
Undistributed net investment loss included in price of units issued and redeemed**# | $ | (0.01 | ) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) The total return from Fund Inception (first day of trading on the Exchange) to April 30, 2008 was 5.71%.
See Notes to Financial Statements.
46
Notes to Financial Statements
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the "Trust") was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company, registered under the Investment Company Act of 1940, as amended (the "1940 Act"). As of period end, the Trust offers seventy-three portfolios. This report includes the following portfolios:
PowerShares Dynamic MagniQuant Portfolio | "Dynamic MagniQuant Portfolio" | ||||||
PowerShares Dynamic Market Portfolio | "Dynamic Market Portfolio" | ||||||
PowerShares Dynamic OTC Portfolio | "Dynamic OTC Portfolio" | ||||||
PowerShares FTSE RAFI US 1000 Portfolio | "FTSE RAFI US 1000 Portfolio" | ||||||
PowerShares NASDAQ NextQ Portfolio | "NASDAQ NextQ Portfolio" | ||||||
Each portfolio (the "Fund" or collectively the "Funds") represents a separate series of the Trust. The shares of the Funds are referred to herein as "Shares" or "Fund Shares." Each Fund's shares are listed and traded on the American Stock Exchange except for shares of the FTSE RAFI US 1000 Portfolio and NASDAQ NextQ Portfolio. The shares of FTSE RAFI US 1000 Portfolio are listed and traded on the New York Stock Exchange Arca, Inc. ("NYSE Arca"), and the shares of NASDAQ NextQ Portfolio are listed and traded on NASDAQ.
The Funds' market prices may differ to some degree from the net asset value of the shares of each Fund. Unlike conventional mutual funds, each Fund issues and redeems shares on a continuous basis, at net asset value, only in a large specified number of shares, each called a "Creation Unit." Creation Units are issued and redeemed generally in-kind for securities included in the relevant index. Except when aggregated in Creation Units, shares are not individually redeemable securities of the Funds. The investment objective of each Fund is to seek investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of the following equity indices:
Fund | Index | ||||||
Dynamic MagniQuant Portfolio | Top 200 Dynamic IntellidexSM Index | ||||||
Dynamic Market Portfolio | Dynamic Market IntellidexSM Index | ||||||
Dynamic OTC Portfolio | Dynamic OTC IntellidexSM Index | ||||||
FTSE RAFI US 1000 Portfolio | FTSI RAFI US 1000SM Index | ||||||
NASDAQ NextQ Portfolio | NASDAQ Q-50SM Index | ||||||
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates.
A. Security Valuation
Securities, including restricted securities, are valued according to the following policy.
A security listed or traded on an exchange (except convertible bonds) 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
47
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
based on prices furnished by independent pricing services or market makers. Listed options if no closing price is available, are valued at the mean between the last bid and the ask 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 ask prices.
Investments in open-end registered investment companies are valued at the end of day net asset value per share.
Debt obligations (including convertible bonds) 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, yield, quality, type of issue, coupon rate, maturity, individual trading characteristics and other market data. Short-term obligations, including commercial paper, having 60 days or less to maturity are recorded at amortized cost which approximates value. Debt securities are subject to interest rate and credit risks. In addition, all debt securities involve some risk of default with respect to interest and/or principal payments.
Foreign securities (including foreign exchange contracts) are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. 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 are significant and may 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 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, ADRs 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.
Securities for which market quotations are not readily available or are 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/ask 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.
48
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer's assets, general economic conditions, interest rates, investor perceptions and market liquidity.
B. Other Risk
The Funds may concentrate investments in a comparatively narrow segment of the economy. Consequently, such Funds may tend to be more volatile than other funds, and the value of investments may tend to rise and fall more rapidly.
When investing in securities of a limited number of companies, each investment has a greater effect on the Fund's overall performance, and any change in the value of those securities could significantly affect the value of your investment in the Fund.
C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and will distribute substantially all of the Fund's taxable earnings to its shareholders. As such, the Funds will not be subject to Federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for Federal income taxes is included.
Income and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from accounting principles generally accepted in the United States. These differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and Passive Foreign Investment Company adjustments, if any.
The Funds file tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
D. Investment Income and Investment Transactions
Dividend income is recorded on the ex-dividend date net of foreign taxes withheld, if any. Interest income is recorded on the accrual basis. Investment transactions are recorded on the trade date. Realized gains and losses from the sale or disposition of securities are calculated on the specific identified cost basis. Dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
E. Expenses
Expenses of the Trust, which are directly identifiable to a specific Fund, are applied to that Fund. Expenses which are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund (except for NASDAQ NextQ Portfolio) is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, any distribution fees or expenses and extraordinary expenses.
49
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
The NASDAQ NextQ Portfolio has agreed to pay an annual unitary management fee to Invesco PowerShares Capital Management LLC ("the Adviser") (formerly PowerShares Capital Management LLC). Whereby, the Adviser has agreed to pay substantially all expenses of the NASDAQ NextQ Portfolio, including the cost of transfer agency, custody, fund administration, legal, audit and other services, except for advisory fees and distribution fees, brokerage expenses, taxes, interest and other extraordinary expenses, if any.
F. Dividends and Distributions to Shareholders
Each Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and distributes net realized taxable capital gains, if any, annually in cash. Such distributions on a tax basis are determined in conformity with income tax regulations which may differ from accounting principles generally accepted in the United States of America. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund's financial statements as a tax return of capital at fiscal period end.
G. Equalization
All Funds use the accounting practice of equalization. This accounting method is used to keep the continuing shareholder's per share equity in undistributed net investment income from being affected by the continuous sales and redemptions of capital shares. Equalization is calculated on a per share basis whereby a portion of the proceeds from the sales and cost of repurchases of capital shares is applied to undistributed net investment income. The amount of equalization is disclosed in the Statements of Changes in Net Assets as undistributed net investment income included in the price of capital shares issued or redeemed. The distributions to shareholders of amounts so applied may be deemed to be a return of capital for tax purposes to the extent that such distributions exceed taxable income.
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with the Adviser such that the Adviser has overall responsibility as the Funds' investment adviser for the selection and ongoing monitoring of the Funds' investments, managing the Funds' business affairs and providing certain clerical, bookkeeping and other administrative services. Each Fund (except for NASDAQ NextQ Portfolio) has agreed to pay an annual fee of 0.50% of the Fund's average daily net assets. The NASDAQ NextQ Portfolio has agreed to pay an annual unitary management fee of 0.70% of average daily net assets and, the Adviser has agreed to pay substantially all expenses of the NASDAQ NextQ Portfolio, including the cost of transfer agency, custody, fund administration, legal, audit and other services, except for advisory fees and distribution fees, brokerage expenses, taxes, interest and other extraordinary expenses, if any.
The Adviser has entered into an Amended and Restated Excess Expense Agreement "Excess Expense Agreement" with the Trust, under which for the Dynamic MagniQuant Portfolio and the FTSE RAFI 1000 Portfolio, the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses of the Funds (excluding interest expense, brokerage commissions and other trading expenses, sub-licensing fees, offering costs, taxes and extraordinary expenses) from exceeding 0.60% of average daily net assets per year (the "Expense Cap"), at least until August 30, 2009. Offering costs excluded from the Expense Cap are: (a) legal fees pertaining to the Funds' shares offered for sale; (b) Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange. For the Dynamic Market Portfolio and the Dynamic OTC Portfolio, the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses of the Funds (excluding interest expense, brokerage commissions and other trading expenses, taxes and extraordinary expenses) from exceeding 0.60% of average daily net assets per year at least until August 30, 2009.
50
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
For the Dynamic MagniQuant Portfolio and the FTSE RAFI US 1000 Portfolio the Excess Expense Agreement provides that the expenses borne by the Adviser are subject to recapture by the Adviser for up to three years from the date the fee or expense was borne by the Adviser, but no recapture payment will be made by a Fund if it would result in the Fund exceeding its Expense Cap as specified above. The Expense Agreement does not apply to the NASDAQ NextQ Portfolio.
The net amount of fees waived and other expenses assumed by the Adviser and the amount of recapture paid to the Adviser pursuant to the Excess Expense Agreement are collectively referred to as 'Waivers and/or Recapture'.
During the period ended April 30, 2008, the amount of 'Waivers and/or Recapture' was as follows:
(Waivers) and/or Recapture | |||||||
Dynamic MagniQuant Portfolio | $ | (40,209 | ) | ||||
Dynamic Market Portfolio | (48,609 | ) | |||||
Dynamic OTC Portfolio | (66,557 | ) | |||||
FTSE RAFI US 1000 Portfolio | 118,831 |
The net amounts of (Waivers) and/or Recapture are also shown on the Statements of Operations.
The amounts available for potential future recapture by the Adviser under the Excess Expense Agreement and the expiration schedule at April 30, 2008 are as follows:
Total Potential | Potential Recapture Amounts Expiring | ||||||||||||||||||
Recapture Amount | 04/30/09 | 04/30/10 | 04/30/11 | ||||||||||||||||
Dynamic MagniQuant Portfolio | $ | 89,347 | — | $ | 36,551 | $ | 52,796 |
Distribution Agreement
The Trust has entered into a Distribution Agreement with Invesco Aim Distributors, Inc. (formerly A I M Distributors, Inc.) (the "Distributor") which serves as the Distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in Shares.
Licensing Fee Agreements
The Adviser has entered into licensing agreements for each Fund with the following Licensor:
Fund | Licensor | ||||||
Dynamic MagniQuant Portfolio | American Stock Exchange | ||||||
Dynamic Market Portfolio | American Stock Exchange | ||||||
Dynamic OTC Portfolio | American Stock Exchange | ||||||
FTSE RAFI US 1000 Portfolio | FTSE International Ltd. | ||||||
NASDAQ NextQ Portfolio | The NASDAQ Stock Market, Inc. | ||||||
The above trademarks are owned by the respective Licensors. These trademarks have been licensed to the Adviser for use with the Funds. The Funds are not sponsored, endorsed, sold or promoted by the Licensors
51
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
and the Licensors make no representation regarding the advisability of investing in any of these Funds. The Funds are required to pay the sub-licensing fees which are shown on the Statements of Operations.
The Bank of New York, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian and fund accounting and transfer agent for each Fund.
The custodian has agreed to provide overdraft protection to the Funds according to the terms of the service agreement.
Note 4. Federal Income Tax
At April 30, 2008, costs of investments on a tax basis including the adjustments for financial reporting purposes as of the most recently completed Federal income tax reporting period were as follows:
Dynamic MagniQuant Portfolio | $ | 63,369,531 | |||||
Dynamic Market Portfolio | 621,403,121 | ||||||
Dynamic OTC Portfolio | 97,035,279 | ||||||
FTSE RAFI US 1000 Portfolio | 961,208,520 | ||||||
NASDAQ NextQ Portfolio | 2,630,541 |
At April 30, 2008, the components of accumulated earnings/loss on a tax-basis were as follows:
Accumulated Earnings | Net Accumulated Capital and other Losses | Unrealized Appreciation/ Depreciation | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Total Accumulated Earnings/Loss | ||||||||||||||||||||||
Dynamic MagniQuant Portfolio | $ | — | $ | (5,211,608 | ) | $ | (392,598 | ) | $ | 3,748,512 | $ | (4,141,110 | ) | $ | (5,604,206 | ) | |||||||||||
Dynamic Market Portfolio | 260,485 | (133,307,073 | ) | 84,940 | 31,599,028 | (31,514,088 | ) | (132,961,648 | ) | ||||||||||||||||||
Dynamic OTC Portfolio | — | (44,772,185 | ) | (975,960 | ) | 6,076,758 | (7,052,718 | ) | (45,748,145 | ) | |||||||||||||||||
FTSE RAFI US 1000 Portfolio | 3,869,539 | (1,193,790 | ) | (82,768,242 | ) | 44,591,841 | (127,360,083 | ) | (80,092,493 | ) | |||||||||||||||||
NASDAQ NextQ Portfolio | 2,563 | (14,131 | ) | 128,656 | 169,195 | (40,539 | ) | 117,088 |
Distributions to Shareholders:
The tax character of distributions paid was as follows:
Period ended April 30, 2008 | Period ended April 30, 2007 | ||||||||||
Distributions paid from Ordinary Income | Distributions paid from Ordinary Income | ||||||||||
Dynamic MagniQuant Portfolio | $ | 640,462 | $ | 106,889 | |||||||
Dynamic Market Portfolio | 7,990,684 | 6,116,430 | |||||||||
FTSE RAFI US 1000 Portfolio | 13,733,870 | 4,798,111 | |||||||||
Period ended April 30, 2008 | Period ended April 30, 2007 | ||||||||||
Distributions paid from Return of Capital | Distributions paid from Return of Capital | ||||||||||
Dynamic MagniQuant Portfolio | $ | 18,785 | — | ||||||||
Dynamic OTC Portfolio | 137,064 | — |
52
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
At April 30, 2008, for Federal income tax purposes, the Funds have capital loss carryforwards available as shown in the table below, to the extent provided by the regulations, to offset future capital gains through the years indicated. To the extent that these loss carryforwards are used to offset future capital gains, it is probable that the capital gains so offset will not be distributed to shareholders. The use of some portion of the capital loss carryforward by any one fund may be limited by federal tax rules. These rules limit the use of the carryforward when there has been a greater than fifty percent change in ownership of a fund.
Year of Expiration | Total | ||||||||||||||||||||||||||||||
2011 | 2012 | 2013 | 2014 | 2015 | 2016 | Amount | |||||||||||||||||||||||||
Dynamic MagniQuant Portfolio | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 5,211,608 | $ | 5,211,608 | |||||||||||||||||
Dynamic Market Portfolio | 225,469 | 8,920,879 | 5,021,729 | 13,686,812 | 65,552,628 | 39,899,556 | 133,307,073 | ||||||||||||||||||||||||
Dynamic OTC Portfolio | 252,044 | 651,452 | 5,297,385 | 5,449,844 | 21,767,708 | 11,353,752 | 44,772,185 | ||||||||||||||||||||||||
FTSE RAFI US 1000 Portfolio | — | — | — | — | 44,432 | 1,149,358 | 1,193,790 | ||||||||||||||||||||||||
NASDAQ NextQ Portfolio | — | — | — | — | — | 14,131 | 14,131 |
Capital losses incurred after October 31 ("post-October losses") within the taxable year are deemed to arise on the first business day of each Fund's next taxable year.
During the period ended April 30, 2008, the Funds incurred and will elect to defer net capital losses as follows:
Post-October Losses | |||||||
Dynamic MagniQuant Portfolio | $ | 6,313,816 | |||||
Dynamic Market Portfolio | 51,777,021 | ||||||
Dynamic OTC Portfolio | 10,923,575 | ||||||
FTSE RAFI US 1000 Portfolio | 16,950,928 |
53
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
In order to present shares of beneficial interest and accumulated net realized gains or losses on the Statements of Assets and Liabilities that more closely represent their tax character, certain adjustments have been made to shares of beneficial interest, undistributed net investment income or loss and accumulated net realized gain or loss on investments. These differences are primarily due to redemptions-in-kind, investments in partnerships, wash sales, book equalization, and net operating losses, if any. These adjustments have no effect on net assets. For the period ended April 30, 2008, the adjustments were as follows:
Undistributed Net Investment Income | Accumulated Loss | Shares of Beneficial Interest | |||||||||||||
Dynamic MagniQuant Portfolio | $ | 10,818 | $ | (4,892,659 | ) | $ | 4,881,841 | ||||||||
Dynamic Market Portfolio | 101,862 | (66,054,856 | ) | 65,952,994 | |||||||||||
Dynamic OTC Portfolio | 442,587 | (7,785,362 | ) | 7,342,775 | |||||||||||
FTSE RAFI US 1000 Portfolio | 708,858 | (54,544,488 | ) | 53,835,630 | |||||||||||
NASDAQ NextQ Portfolio | 1,245 | (86,234 | ) | 84,989 |
Note 5. Investment Transactions
For the period ended April 30, 2008, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, money market funds and in-kind transactions, were as follows:
Purchases | Sales | ||||||||||
Dynamic MagniQuant Portfolio | $ | 62,936,117 | $ | 72,709,910 | |||||||
Dynamic Market Portfolio | 977,781,480 | 1,003,579,628 | |||||||||
Dynamic OTC Portfolio | 81,741,131 | 87,148,583 | |||||||||
FTSE RAFI US 1000 Portfolio | 128,706,161 | 135,239,049 | |||||||||
NASDAQ NextQ Portfolio | 401,983 | 402,613 |
For the period ended April 30, 2008, in-kind transactions associated with creations and redemptions were as follows:
Securities Received | Securities Delivered | ||||||||||
Dynamic MagniQuant Portfolio | $ | 129,633,766 | $ | 128,773,473 | |||||||
Dynamic Market Portfolio | 1,014,767,117 | 1,256,599,232 | |||||||||
Dynamic OTC Portfolio | 243,124,794 | 280,563,863 | |||||||||
FTSE RAFI US 1000 Portfolio | 353,790,492 | 414,704,090 | |||||||||
NASDAQ NextQ Portfolio | 5,206,043 | 2,649,927 |
Gains on in-kind transactions are not considered taxable gains for Federal income tax purposes.
Note 6. Trustees' Fees
The Funds (except for NASDAQ NextQ Portfolio) compensate each Trustee on behalf of the Trust who is not an employee of the Trust or its affiliates. With respect to NASDAQ NextQ Portfolio, the Adviser, as a result of the unitary management fee, compensates each Trustee on behalf of the Fund. Interested Trustees and Officers of the Trust do not receive any Trustees' fees.
54
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
The Trust (has adopted a deferred compensation plan (the "Plan"). Under the Plan, a trustee who is not an "interested person" (as defined in the 1940 Act) and has elected to participate in the Plan (a "participating trustee") may defer receipt of all or a portion of his compensation ("Deferral Fees"). Such Deferred Fees are deemed to be invested in selected PowerShares Funds. The Deferral Fees payable to the participating trustee is valued as of the first business dates of each calendar quarter such Fees would have been paid to the participating trustee. The value increases with contributions or with increases in the value of the shares selected, and the value decreases with withdrawals or with declines in the value of the shares selected.
Note 7. Capital
Shares are created and redeemed by the Trust only in Creation Unit size aggregations of 100,000 (50,000 for Dynamic Market and Dynamic OTC Portfolios). Only authorized participants are permitted to create or redeem from the Funds. Such transactions are generally permitted on an in-kind basis, with a balancing cash component to equate the transaction to the net asset value per unit of each Fund of the Trust on the transaction date. Cash may be substituted equivalent to the value of certain securities generally when they are not available in sufficient quantity for delivery, not be eligible for trading by the Authorized Participant or as a result of other market circumstances.
Note 8. Indemnifications
Under the Trust's organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust's maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
Note 9. New Accounting Pronouncement
On September 20, 2006, the FASB released Statement of Financial Accounting Standards No. 157 "Fair Value Measurement" ("FAS 157"). FAS 157 establishes an authoritative definition of fair value, sets out a framework for measuring fair value, and requires additional disclosures about fair-value measurement. The application of FAS 157 is required for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. Management has assessed the application of FAS 157 to the Funds and has determined that the adoption of FAS 157 is not expected to have a material impact on the Funds. Management intends for the Funds to adopt FAS 157 provisions during the fiscal year ending April 30, 2009.
55
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of each of the portfolios indicated in Note 1 of the financial statements (each a portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the "Trust") at April 30, 2008, and the results of each of their operations, the changes in each of their net assets, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Trust's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2008 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
New York, New York
June 30, 2008
56
Supplemental Information
Federal Income Tax Information
The percentages of investment income (dividend income plus short-term gains, if any) qualify as follows:
Qualified dividend income | Dividends-received deduction | ||||||||||
Dynamic MagniQuant Portfolio | 100 | % | 100 | % | |||||||
Dynamic Market Portfolio | 100 | % | 100 | % | |||||||
Dynamic OTC Portfolio | 0 | % | 0 | % | |||||||
FTSE RAFI US 1000 Portfolio | 100 | % | 100 | % | |||||||
NASDAQ NextQ Portfolio | 100 | % | 100 | % |
57
Supplemental Information
Trustees and Officers
The Trustees who are not affiliated with the Adviser or affiliates of the Adviser ("Independent Trustees") and the Trustee who is affiliated with the Adviser ("Management Trustee") and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by the Trustee, are shown below.
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Ronn R. Bagge (b. 1958) YQA Capital Management, LLC 1755 S. Naperville Rd., Suite 100 Wheaton, IL 60187 | Trustee | Since 2003 | YQA Capital Management LLC (July 1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider) | 104 | None | ||||||||||||||||||
Marc M. Kole (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | Assistant Vice President and Controller, Priority Health (September 2005-April 2008); formerly, Interim CFO, Priority Health (July 2006-April 2007); formerly Senior Vice President of Finance, United Healthcare (health insurance) (July 2004-July 2005); formerly Senior Vice President of Finance, Oxford Health Plans (June 2000-July 2004) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
58
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
D. Mark McMillan (b. 1963) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Partner, Bell, Boyd & Lloyd LLP (1989-Present) | 104 | None | ||||||||||||||||||
Philip M. Nussbaum (b. 1961) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (formerly Betzold, Berg, Nussbaum & Heitman, Inc.) (November 2004-Present); formerly Managing Director, Communication Institute (May 2002-August 2003); formerly Executive Vice President of Finance, Betzold, Berg, Nussbaum & Heitman, Inc. (March 1994-1999) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
59
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Donald H. Wilson (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | President, Chief Operating Officer and Chief Financial Officer, AMCORE Financial, Inc. (bank holding company) (August 2007- Present), formerly, Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (February 2006- August 2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (May 1995-February 2006) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
60
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Management Trustee | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex*** Overseen by Trustee | Other Directorships Held by Trustee | ||||||||||||||||||
H. Bruce Bond (b. 1963)** Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chairman of the Board, Trustee and Chief Executive Officer | Since 2003 | Managing Director, Invesco PowerShares Capital Management LLC (August 2002- Present); formerly Manager, Nuveen Investments (April 1998- August 2002) | 104 | None | ||||||||||||||||||
Availability of Additional Information About Funds' Trustees
The Statement of Additional Information includes additional information about the Funds' Trustees and is available, without charge, upon request at 800.337.4246.
* This is the date the Management Trustee began serving the Trust.
** Interested person as defined in Section 2(a)(19) of the 1940 Act.
*** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
61
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Officers | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | ||||||||||||
Bruce T. Duncan (b. 1954) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Financial Officer, Treasurer and Secretary | Chief Financial Officer and Treasurer Since 2006 Secretary Since 2008 | Senior Vice President of Finance, Invesco PowerShares Capital Management LLC (September 2005-Present); Private Practice Attorney (2000-2005); Vice President of Investor Relations, The ServiceMaster Company (1994-2000); Vice President of Taxes, The ServiceMaster Company (1990-2000) | ||||||||||||
Kevin R. Gustafson (b. 1965) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Compliance Officer | Since 2004 | General Counsel, Invesco PowerShares Capital Management LLC (September 2004-Present); Chief Compliance Officer, Invesco PowerShares Capital Management LLC (September 2004-April 2008); Attorney, Nyberg & Gustafson (2001-2004); Attorney, Burke, Warren, McKay & Serritella, P.C. (1997-2000) | ||||||||||||
* This is the period for which the Officers began serving the Trust. Each Officer serves a one year term, until his successor is elected.
62
Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 18, 2008, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the "Trust"), including the Independent Trustees, unanimously approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the "Adviser") and the Trust for the following 70 series (the "Funds"):
PowerShares Dynamic Market Portfolio
PowerShares Dynamic OTC Portfolio
PowerShares Golden Dragon Halter USX China Portfolio
PowerShares High Yield Equity Dividend AchieversTM Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Mid Cap Growth Portfolio
PowerShares Dynamic Mid Cap Value Portfolio
PowerShares Dynamic Small Cap Growth Portfolio
PowerShares Dynamic Small Cap Value Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Zacks Micro Cap Portfolio
PowerShares Aerospace & Defense Portfolio
PowerShares Dynamic Hardware & Consumer Electronics Portfolio
PowerShares Dynamic Telecommunications & Wireless Portfolio
PowerShares Value Line Timeliness Select Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares High Growth Rate Dividend AchieversTM Portfolio
PowerShares Zacks Small Cap Portfolio
PowerShares Dynamic Building and Construction Portfolio
PowerShares Dynamic Energy Exploration and Production Portfolio
PowerShares Dynamic Insurance Portfolio
PowerShares Dynamic Oil and Gas Services Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Utilities Portfolio
PowerShares Lux Nanotech Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares Water Resources Portfolio
PowerShares Dynamic Energy Sector Portfolio
PowerShares Dynamic Financial Sector Portfolio
PowerShares Dynamic Healthcare Sector Portfolio
PowerShares Dynamic Industrials Sector Portfolio
PowerShares Dynamic Large Cap Portfolio
PowerShares Dynamic MagniQuant Portfolio
PowerShares Dynamic Mid Cap Portfolio
PowerShares Dynamic Small Cap Portfolio
PowerShares Dynamic Technology Sector Portfolio
PowerShares Buyback AchieversTM Portfolio
PowerShares FTSE RAFI Basic Materials Sector Portfolio
PowerShares FTSE RAFI Consumer Goods Sector Portfolio
PowerShares FTSE RAFI Consumer Services Sector Portfolio
PowerShares FTSE RAFI Energy Sector Portfolio
PowerShares FTSE RAFI Financials Sector Portfolio
PowerShares FTSE RAFI Health Care Sector Portfolio
PowerShares FTSE RAFI Industrials Sector Portfolio
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares FTSE RAFI Utilities Sector Portfolio
PowerShares Cleantech Portfolio
PowerShares Dynamic Aggressive Growth Portfolio
63
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
PowerShares Dynamic Banking Portfolio
PowerShares Dynamic Basic Materials Sector Portfolio
PowerShares Dynamic Consumer Discretionary Sector Portfolio
PowerShares Dynamic Consumer Staples Sector Portfolio
PowerShares Dynamic Healthcare Services Portfolio
PowerShares Dynamic Deep Value Portfolio
PowerShares Financial Preferred Portfolio
PowerShares Listed Private Equity Portfolio
PowerShares DWA Technical Leaders Portfolio
PowerShares Value Line Industry Rotation Portfolio
PowerShares WilderHill Progressive Energy Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as the Funds grow, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered and amounts paid to other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser's services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser's current organization, including operations assistance provided by the Adviser's parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser's portfolio transaction policies and procedures. The Trustees reviewed information on the performance of the Funds and the performance of their benchmark indices. The Trustees also reviewed reports on the correlation and tracking error between the underlying index and each Fund's performance and reviewed a report of Ibbotson Associates, a c onsultant to the Independent Trustees, that analyzed the reasons for any tracking error for certain of the Funds, which the Adviser then applied to its analysis of the tracking error between the underlying index and the performance of each Fund. The Trustees noted that, in each case, the correlation and tracking error was within the range set forth in the registration statement. The Trustees also concluded that each of the Funds is correlated to its underlying index and that the tracking error for each Fund was within a reasonable range in that Fund's particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds' administrator, custodian and transfer agent. They noted the significant amount of time and effort that had been devoted to this oversight function.
Based on their review, the Trustees found that the nature and extent of services provided to the Funds under the Investment Advisory Agreement are appropriate and that the quality is good.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund's expense ratio and the advisory fee, as compared to three categories of comparable funds selected by Lipper Inc., an independent source: exchange-traded index funds ("ETFs"), open-end (non-ETF) index funds and open-end actively-managed funds. The Adviser supplemented the information
64
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
prepared by Lipper Inc. with data it compiled on expense ratios and advisory fees of newer ETFs that recently commenced operations. The Trustees noted that the annual advisory fee charged to the Funds was identical (0.50% of average net assets), except for the advisory fee for the PowerShares High Yield Equity Dividend AchieversTM Portfolio, the PowerShares Dividend AchieversTM Portfolio, the PowerShares High Growth Rate Dividend AchieversTM Portfolio and the PowerShares International Dividend AchieversTM Portfolio (for each of which the annual advisory fee was 0.40% of average net assets), and that the Adviser had agreed to waive the fee and/or pay expenses to the extent necessary to prevent the annual operating expenses of each Fund (excluding interest expenses, licensing fees and offering costs (for all Funds other than the initial two Funds, the PowerShares Dynamic OTC Portfolio an d the PowerShares Dynamic Market Portfolio), brokerage commissions and other trading expenses, taxes and extraordinary expenses) from exceeding 0.60% of average net assets (0.50% of average net assets for the PowerShares High Yield Equity Dividend AchieversTM Portfolio, the PowerShares Dividend AchieversTM Portfolio, the PowerShares High Growth Rate Dividend AchieversTM Portfolio and the PowerShares International Dividend AchieversTM Portfolio) at least until April 30, 2009. The Trustees noted that the Adviser represented that it does not provide investment management services to clients other than the Trust and other exchange-traded funds overseen by the Board. The Trustees noted that the advisory fees were at the higher end of the ETF peer funds, but were lower than the median of the open-end actively-managed peer funds. The Trustees determined that the advisory fees were reasonable because of the complexity of the indices, which generally require more frequent r ebalancing of the portfolios, the distinguishing factors of the Funds, and the higher administrative, operational and management oversight costs for the Adviser. With respect to the Funds' expense ratios, the Trustees noted that the net expense ratios were at the higher end of the ETF peer funds, but were generally lower than the median of the expense ratios of the open-end (non-ETF) index peer funds and the median of the open-end actively-managed peer funds. The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds. The Board concluded that the advisory fee and expense ratio of each Fund are competitive and that the advisory fee for each Fund is reasonable and appropriate in amount in light of the quality of services provided and the expense cap in place.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability as well as any profits realized by the Adviser from its relationship to each Fund. The Trustees concluded that the profitability to the Adviser of the advisory services provided to the Funds is not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund's asset size, expense ratio, expense limitation agreed to by the Adviser and whether the investment process produced economies of scale. The Trustees noted that certain fixed costs associated with the management of the Funds are being reduced on a per-Fund basis as additional Funds are added, and that the gradual reduction of the per-Fund cost enabled the Adviser to operate some of the Funds under the expense cap, which potentially would lower the costs to shareholders. The Trustees noted that the Excess Expense Agreement with the Trust provided that the Adviser was entitled to be reimbursed by each Fund for fees waived or expenses absorbed pursuant to the expense cap for a period of three years
65
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its expense cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds, and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
66
Board Considerations Regarding Approval of Investment
Advisory Agreement for the PowerShares NASDAQ NextQ
Portfolio
At a meeting held on October 2, 2007, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the "Trust"), including the Independent Trustees, approved the Investment Advisory Agreement between PowerShares Capital Management LLC (the "Adviser") and the Trust for the PowerShares NASDAQ NextQ Portfolio (the "Fund").
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services to be provided, (ii) since Fund performance was not available, the correlation and tracking error between the indices tracked by other exchange-traded funds ("ETFs") for which the Adviser serves as such and those funds' performance, (iii) the costs of services to be provided and estimated profits to be realized by the Adviser, (iv) the extent to which economies of scale may be realized as the Fund grows, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered and amounts paid to other registered investment companies and (vii) any benefits to be realized by the Adviser from its relationship with the Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to appr ove the Investment Advisory Agreement for the Fund. No single factor was determinative in the Board's analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser's services, the Trustees reviewed information concerning the functions to be performed by the Adviser, information describing the Adviser's current organization and projected staffing, and the background and experience of the persons responsible for the day-to-day management of the Fund, and considered the quality of services provided by the Adviser to other ETFs. The Trustees reviewed matters related to the Adviser's portfolio transaction policies and procedures. The Trustees reviewed reports on the correlation and tracking error between the underlying indexes and the performance of other ETFs for which the Adviser serves as investment adviser.
The Trustees also considered the services to be provided by the Adviser in its oversight of the Fund's administrator, custodian and transfer agent. They noted the significant amount of time and effort that had been devoted to this oversight function for the other ETFs and that was expected to be provided for the Fund.
Based on their review, the Trustees concluded that the nature and extent of services to be provided by the Adviser to the Fund were appropriate and that the quality was expected to be good.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on the Fund's expected total expense ratio and proposed advisory fee, as compared to information prepared by Lipper Inc., an independent source, on expense ratios and advisory fees of a broad universe of ETFs and other index funds. The Adviser supplemented the information prepared by Lipper Inc. with data it compiled on expense ratios and advisory fees of newer ETFs that recently commenced operations. The Trustees also considered data from an August 2007 report by Morgan Stanley, Inc. showing average expense ratios for various types of ETFs and open-end funds, including index funds. The Trustees noted that the annual advisory fee to be charged to the Fund was a unitary fee, and that the Adviser agreed to pay all expenses of the Fund except bro kerage commissions and other trading expenses, taxes and extraordinary expenses. The Trustees noted that the advisory fees were generally at the higher end of the ETF universe, but were generally lower than fees for open-end (non-ETF) funds and closed-end funds, and were reasonable because of the complexity of the indices, which generally require more frequent rebalancing of the portfolios, the distinguishing factors of the Funds, and the higher administrative, operational and management oversight costs for the Adviser. The Trustees also noted that some of the
67
Board Considerations Regarding Approval of Investment
Advisory Agreement for the PowerShares NASDAQ NextQ
Portfolio (Continued)
higher advisory fees were attributable to higher license fees payable out of the unitary fee charged to the Funds. The Board noted that the Advisor represented that the advisory fees were competitive with those of their ETF peers. The Board concluded that the advisory fee and expected total expense ratio of each Fund are reasonable and appropriate in amount in light of the quality of services expected to be provided.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser as investment adviser to the other ETFs, as well as the fees waived and expenses reimbursed by the Adviser for those ETFs. The Trustees reviewed information provided by the Adviser on its profitability as well as any profits realized by the Adviser from its relationship to those ETFs. The Trustees noted the Adviser's statement that its costs of managing those ETFs generally exceeded the amount payable as management fees under the investment advisory agreement for those funds. The Trustees concluded that the estimated profits to be realized by the Adviser with respect to the Fund appeared to be reasonable in comparison with the costs of providing investment advisory services to the Fund.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as the Fund and other series of the Trust grow and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees noted that certain fixed costs associated with the management of the Fund can be reduced on a per-fund basis, and that although such economies would be enjoyed by the Adviser, a unitary fee provides certainty in expenses for the Fund. The Trustees considered whether the advisory fee rate for the Fund is reasonable in relation to the projected asset size of the Fund, and concluded that the flat advisory fee was reasonable and appropriate.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Fund, and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the Investment Advisory Agreement for the Fund. No single factor was determinative in the Board's analysis.
68
PROXY VOTING POLICIES AND PROCEDURES
A description of the Funds' proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 337-4246. This information is also available on the Securities and Exchange Commission's ("Commission") website at www.sec.gov.
Information regarding how the Funds voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 337-4246; or (ii) accessing the Funds' Form N-PX on the Commission's website at www.sec.gov.
QUARTERLY PORTFOLIOS
The Funds file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds' Forms N-Q are available on the Commission's website at www.sec.gov. The Funds' Forms N-Q may also be reviewed and copied at the Commission's Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
There are risks involved in investing in ETFs, including possible loss of money. Investing in securities of small and medium sized companies involves greater risk than is customarily associated with investing in more established companies, and investments in concentrated industry sectors involve greater risks than investments that are more diversified. PowerShares ETFs are not actively managed and are subject to risks similar to stocks, including those related to short selling and margin maintenance. PowerShares ETFs are not FDIC insured, may lose value and have no bank guarantee. PowerShares is a registered trademark of Invesco PowerShares Capital Management LLC. Past performance is not a guarantee of future results.
Invesco Aim Distributors, Inc. is the distributor of the PowerShares Exchange-Traded Fund Trust.
An investor should consider each Fund's investment objective, risks, charges and expenses carefully before investing. For more complete information about PowerShares ETFs call Invesco Aim Distributors, Inc. at (800) 337-4246 or visit our website invescopowershares.com for a prospectus. Please read the prospectus carefully before investing.
301 West Roosevelt Road
Wheaton, IL 60187
800.983.0903
www.invescopowershares.com
© 2008 Invesco PowerShares Capital Management LLC P-PS-AR-2
2008 Annual Report to Shareholders
30 April 2008
PowerShares Dynamic Aggressive Growth Portfolio
PowerShares Dynamic Deep Value Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Mid Cap Growth Portfolio
PowerShares Dynamic Mid Cap Portfolio
PowerShares Dynamic Mid Cap Value Portfolio
PowerShares Dynamic Small Cap Growth Portfolio
PowerShares Dynamic Small Cap Portfolio
PowerShares Dynamic Small Cap Value Portfolio
PowerShares FTSE NASDAQ Small Cap Portfolio
PowerShares Zacks Micro Cap Portfolio
PowerShares Zacks Small Cap Portfolio
Table of Contents
Shareholder Letter | 2 | ||||||
The Market Environment | 3 | ||||||
Manager's Analysis | 4 | ||||||
Funds' Distribution History | 32 | ||||||
Frequency Distribution of Discounts & Premiums | 34 | ||||||
Fees and Expenses | 36 | ||||||
Style Portfolios | |||||||
Schedules of Investments | |||||||
PowerShares Dynamic Aggressive Growth Portfolio | 38 | ||||||
PowerShares Dynamic Deep Value Portfolio | 40 | ||||||
PowerShares Dynamic Large Cap Growth Portfolio | 42 | ||||||
PowerShares Dynamic Large Cap Portfolio | 43 | ||||||
PowerShares Dynamic Large Cap Value Portfolio | 45 | ||||||
PowerShares Dynamic Mid Cap Growth Portfolio | 46 | ||||||
PowerShares Dynamic Mid Cap Portfolio | 47 | ||||||
PowerShares Dynamic Mid Cap Value Portfolio | 49 | ||||||
PowerShares Dynamic Small Cap Growth Portfolio | 51 | ||||||
PowerShares Dynamic Small Cap Portfolio | 53 | ||||||
PowerShares Dynamic Small Cap Value Portfolio | 56 | ||||||
PowerShares FTSE NASDAQ Small Cap Portfolio | 58 | ||||||
PowerShares Zacks Micro Cap Portfolio | 70 | ||||||
PowerShares Zacks Small Cap Portfolio | 75 | ||||||
Statements of Assets and Liabilities | 78 | ||||||
Statements of Operations | 80 | ||||||
Statements of Changes in Net Assets | 82 | ||||||
Financial Highlights | 87 | ||||||
Notes to Financial Statements | 94 | ||||||
Report of Independent Registered Public Accounting Firm | 106 | ||||||
Supplemental Information | 107 | ||||||
Information about Advisory Agreements | 113 | ||||||
To My Fellow Investors,
It gives me great pleasure to report on the state of your investment in PowerShares Exchange-Traded Funds and to thank you for your continued confidence in Invesco PowerShares Capital Management LLC.
Invesco PowerShares has accomplished a number of corporate and industry achievements in 2007. Some of the most notable successes over the past 12 months are that PowerShares:
• Was the first to receive approval from the SEC to operate actively managed equity and fixed-income ETFs.
• Launched our initial group of international ETFs, which invest directly in securities listed on foreign exchanges. As of April 30, 2008, we had 17 ETFs allowing investors to invest across a wide geographic range.
• Brought out the markets only ETFs investing in insured municipal bonds. These three ETF's were part of our initial entry into the Fixed Income portion of the investment spectrum.
• Further enhanced our reputation as one of the leading innovators in the ETF marketplace when the PowerShares S&P Buy-Write Portfolio was awarded the most innovative new ETF for 2007.
• Expanded our global footprint with the introduction of 14 PowerShares ETFs listed on four major stock exchanges across Europe (London, Milan, Frankfurt and Paris).
• Launched the PowerShares India Portfolio, one of the first ETFs to provide U.S. investors with direct access to securities listed on the India stock exchange.
Another milestone of the past year was the adoption of our new name, Invesco PowerShares – in short, we have a new corporate name. Invesco PowerShares represents the strength of global diversification you get through the combination of Invesco's worldwide resources and PowerShares' market leading ETF capabilities. As one of the world's largest and most diversified global investment organizations, Invesco has more than 500 investment professionals operating in investment centers in 25 cities, a presence in 12 countries and $500 billion in assets under management globally at the end of 2007.
While our name has changed and we have a new corporate logo, our goal of delivering the highest quality investment management available in the ETF structure has not changed and all of the names of your funds and their trading symbols remain the same – as do all of our telephone contact numbers. All of us at Invesco PowerShares will continue to strive to provide you with compelling investment solutions and high-quality customer service. Regardless of market conditions, Invesco PowerShares will hold true to its mission: seeking to build financial security for investors.
Best regards,
H. Bruce Bond
President and Chairman of the Board of Trustees
PowerShares Exchange-Traded Fund Trust
2
The Market Environment
Although the benchmark S&P500 index hit an all-time high in October, 2007, it capitulated as the subprime mortgage crisis began to negatively affect the balance sheets of major U.S. financial institutions. As a result, volatility (as measured by the CBOE "VIX" index) increased by 46.2% during the April 30, 2007 to April 30, 2008 reporting period. Another dramatic rise over the same timeframe was the price of crude oil, which rallied 72.7%. U.S. economic growth began to slow significantly in Q1 2008, leading to recession concerns addressed by the Federal Reserve Bank through aggressive monetary policy easing (the Fed Fund target rate was cut by 2.25% in 2008). The combination of lower short-term U.S. interest rates and the recycling of petrodollars into European banks caused the U.S. dollar to weaken versus all G7 currencies for the year ended April 30, 2008.
By March, 2008, even the AAA-rated monoline bond insurers succumbed to the U.S. credit crunch. Bond insurer ratings downgrades led to huge displacements within the municipal bond market. An impending liquidity crisis was quelled in mid-March by the Fed via the creation of a $200bn lending facility and the approval of Bear Stearns' sale to JP Morgan. Along with the restoration of confidence in the U.S. financial system came a respectable April rally in the U.S. equity market, leaving the S&P500 with a yearly total return of -4.68% over the reporting period while the DJIA was 0.47% and the NASDAQ-100 was +3.18%. For the same period, the Lehman Brothers U.S. Aggregate Total Return bond index was 6.87%.
3
Manager's Analysis
PowerShares Dynamic Aggressive Growth Portfolio (ticker: PGZ)
The PowerShares Dynamic Aggressive Growth Portfolio is based on the Dynamic Aggressive Growth IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Aggressive Growth Portfolio posted a -2.73% return over the reporting period. During the last year, growth stocks have outperformed value stocks as investors migrated to larger cap stocks with future. Value stocks within the industrials and energy sectors contributed positively to the funds performance. Foster Wheeler Ltd., McDermott International and HIS, Inc. were some of the largest contributors. Stock selection within information technology and poor allocation within health care contributed negatively to the funds overall performance for the period.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Information Technology | 29.1 | ||||||
Health Care | 24.4 | ||||||
Industrials | 18.6 | ||||||
Consumer Discretionary | 17.2 | ||||||
Energy | 6.4 | ||||||
Financials | 3.3 | ||||||
Materials | 1.0 | ||||||
Other | (0.0 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Mid-Cap Growth | 50.2 | ||||||
Small-Cap Growth | 32.8 | ||||||
Large-Cap Growth | 17.0 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Millennium Pharmaceuticals, Inc. | 1.7 | ||||||
Sohu.com, Inc. | 1.4 | ||||||
Mastercard, Inc., Class A | 1.4 | ||||||
Corinthian Colleges, Inc. | 1.3 | ||||||
Apple, Inc. | 1.3 | ||||||
Massey Energy Co. | 1.3 | ||||||
Ansoft Corp. | 1.3 | ||||||
GameStop Corp., Class A | 1.2 | ||||||
DeVry, Inc. | 1.2 | ||||||
Amphenol Corp., Class A | 1.2 | ||||||
Total | 13.3 |
4
Manager's Analysis (Continued)
PowerShares Dynamic Aggressive Growth Portfolio (ticker: PGZ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Aggressive Growth IntellidexSM Index | -1.88 | 3.19 | 4.38 | ||||||||||||
Russell 3000® Growth Index | -0.79 | 3.27 | 4.49 | ||||||||||||
S&P 500® Pure Growth Index | -3.17 | 1.72 | 2.36 |
Fund
NAV Return | -2.73 | 2.36 | 3.22 | ||||||||||||
Share Price Return | -2.77 | 2.32 | 3.18 |
Fund Inception: 20 December 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 2.37%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.86% while the Fund's gross total operating expense ratio was 1.94%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Russell 3000® Growth Index and the S&P 500® Pure Growth Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 1,936 and 154, respectively, widely held stocks.
† Average annualized.
5
Manager's Analysis
PowerShares Dynamic Deep Value Portfolio (ticker: PVM)
The PowerShares Dynamic Deep Value Portfolio is based on the Dynamic Deep Value IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Deep Value Portfolio posted a -8.05% return as value stocks underperformed growth for the reporting period. While value stocks had done well in previous years, they have pulled back during the most recent reporting period. Financials, consumer discretionary and telecommunication services led to the Fund's underperformance. Energy was the leader as it contributed the most to the Fund's performance. Hess Corporation, Apache Corporation and Occidental Petroleum were the leaders within energy while XL Capital, United America Indemnity Ltd. And Delphi Financial Group was the laggards leading to the underperformance within financials.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 40.1 | ||||||
Information Technology | 12.1 | ||||||
Energy | 10.8 | ||||||
Consumer Discretionary | 9.5 | ||||||
Utilities | 9.2 | ||||||
Industrials | 7.9 | ||||||
Consumer Staples | 5.7 | ||||||
Telecommunication Services | 3.8 | ||||||
Health Care | 0.9 | ||||||
Money Market Fund | 1.9 | ||||||
Other | (1.9 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Mid-Cap Value | 38.1 | ||||||
Large-Cap Value | 29.5 | ||||||
Small-Cap Value | 28.2 | ||||||
Small-Cap Growth | 2.3 | ||||||
Mid-Cap Growth | 1.9 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Safeco Corp. | 1.4 | ||||||
Plantronics, Inc. | 1.3 | ||||||
Lufkin Industries, Inc. | 1.3 | ||||||
EarthLink, Inc. | 1.2 | ||||||
Rent-A-Center, Inc. | 1.2 | ||||||
Westamerica Bancorp | 1.2 | ||||||
Autoliv, Inc. | 1.2 | ||||||
Stone Energy Corp. | 1.2 | ||||||
Helmerich & Payne, Inc. | 1.2 | ||||||
Ryder System, Inc. | 1.1 | ||||||
Total | 12.3 |
6
Manager's Analysis (Continued)
PowerShares Dynamic Deep Value Portfolio (ticker: PVM)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Deep Value IntellidexSM Index | -7.31 | -1.41 | -1.92 | ||||||||||||
Russell 3000® Value Index | -9.49 | -3.79 | -5.14 | ||||||||||||
S&P 500® Pure Value Index | -18.20 | -8.87 | -11.91 |
Fund
NAV Return | -8.05 | -2.14 | -2.90 | ||||||||||||
Share Price Return | -8.34 | -2.36 | -3.20 |
Fund Inception: 20 December 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 2.03%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.82% while the Fund's gross total operating expense ratio was 1.65%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Russell 3000® Value Index and the S&P 500® Pure Value Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 1,896 and 138, respectively, widely held stocks.
† Average annualized.
7
Manager's Analysis
PowerShares Dynamic Large Cap Growth Portfolio (ticker: PWB)
The PowerShares Dynamic Large Cap Growth Portfolio is based on the Dynamic Large Cap Growth IntellidexSM Index which seeks to provide capital appreciation while maintaining consistent and stylistically accurate exposure.
The PowerShares Dynamic Large Cap Growth Portfolio posted a return of -0.56% over the reporting period. During this time, growth stocks outperformed value stocks. The Fund behaved accordingly given these conditions underperformed the general market. Materials were the leading sector for the Fund with Monsanto and Mosaic contributing significantly to the Fund's performance. Consumer discretionary and health care contributed the most underperformance for the fund during the year with Schering-Plough being the largest laggard.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Information Technology | 38.9 | ||||||
Health Care | 18.4 | ||||||
Consumer Discretionary | 9.4 | ||||||
Materials | 7.6 | ||||||
Industrials | 7.1 | ||||||
Consumer Staples | 6.2 | ||||||
Financials | 4.5 | ||||||
Utilities | 4.1 | ||||||
Energy | 3.7 | ||||||
Money Market Fund | 0.1 | ||||||
Other | 0.0 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Growth | 96.1 | ||||||
Large-Cap Value | 2.8 | ||||||
Mid-Cap Growth | 1.1 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Apple, Inc. | 4.4 | ||||||
Google, Inc., Class A | 3.9 | ||||||
Schlumberger Ltd. | 3.7 | ||||||
Intel Corp. | 3.5 | ||||||
Oracle Corp. | 3.5 | ||||||
Cisco Systems, Inc. | 3.3 | ||||||
Microsoft Corp. | 3.3 | ||||||
QUALCOMM, Inc. | 3.2 | ||||||
Procter & Gamble (The) Co. | 3.2 | ||||||
Medtronic, Inc. | 3.1 | ||||||
Total | 35.1 |
8
Manager's Analysis (Continued)
PowerShares Dynamic Large Cap Growth Portfolio (ticker: PWB)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||||||||||
1 Year | 3 Year | Avg. Ann.† | Cumulative | ||||||||||||||||||||
Dynamic Large Cap Growth IntellidexSM Index | 0.09 | 7.90 | 5.86 | 19.77 | |||||||||||||||||||
Russell 1000® Growth Index | -0.23 | 8.86 | 6.89 | 23.51 | |||||||||||||||||||
S&P Citigroup Large Cap Growth Index | -0.42 | 7.63 | 5.83 | 19.67 |
Fund
NAV Return | -0.56 | 7.21 | 5.16 | 17.24 | |||||||||||||||||||
Share Price Return | -0.58 | 7.20 | 5.10 | 17.04 |
Fund Inception: 3 March 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.68%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.60%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Russell 1000® Growth Index and the S&P Citigroup Large Cap Growth Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 691 and 318, respectively, widely held stocks.
† Average annualized.
9
Manager's Analysis
PowerShares Dynamic Large Cap Portfolio (ticker: PJF)
The PowerShares Dynamic Large Cap Portfolio is based on the Dynamic Large Cap IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Large Cap Portfolio posted a -3.26% return during the reporting period. During the year, large cap stocks have outperformed the mid cap and small cap peers as the fears of a recession and global economic slowdown lead investors to larger, more stable companies. Good stock selection within the energy and materials sectors boosted the fund's performance. Within energy, Hess, Occidental Petroleum, Chevron, and Exxon Mobil contributed positive to the overall performance. Financials, healthcare and consumer discretionary hurt the Funds performance. An overweight position in Merrill Lynch and Goldman Sachs contributed to the Fund's underperformance.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Information Technology | 19.7 | ||||||
Health Care | 15.4 | ||||||
Industrials | 12.9 | ||||||
Financials | 11.6 | ||||||
Energy | 11.2 | ||||||
Consumer Discretionary | 10.5 | ||||||
Consumer Staples | 9.0 | ||||||
Utilities | 5.2 | ||||||
Telecommunication Services | 3.5 | ||||||
Materials | 0.8 | ||||||
Money Market Fund | 0.6 | ||||||
Other | (0.4 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Growth | 51.2 | ||||||
Large-Cap Value | 47.5 | ||||||
Mid-Cap Value | 0.7 | ||||||
Mid-Cap Growth | 0.6 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Apple, Inc. | 2.3 | ||||||
Schlumberger Ltd. | 1.9 | ||||||
American Express Co. | 1.8 | ||||||
Intel Corp. | 1.8 | ||||||
AT&T, Inc. | 1.8 | ||||||
Chevron Corp. | 1.8 | ||||||
Oracle Corp. | 1.8 | ||||||
McDonald's Corp. | 1.8 | ||||||
Johnson & Johnson | 1.8 | ||||||
Occidental Petroleum Corp. | 1.7 | ||||||
Total | 18.5 |
10
Manager's Analysis (Continued)
PowerShares Dynamic Large Cap Portfolio (ticker: PJF)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Large Cap IntellidexSM Index | -2.54 | 3.58 | 5.10 | ||||||||||||
S&P 100® Index | -3.64 | 1.38 | 1.96 | ||||||||||||
Russell Top 200® Index | -3.87 | 1.65 | 2.34 |
Fund
NAV Return | -3.26 | 2.85 | 4.04 | ||||||||||||
Share Price Return | -3.38 | 2.74 | 3.89 |
Fund Inception: 1 December 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.96%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.73% while the Fund's gross total operating expense ratio was 1.38%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 100® Index and the Russell Top 200® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 100 and 205, respectively, widely held stocks.
† Average annualized.
11
Manager's Analysis
PowerShares Dynamic Large Cap Value Portfolio (ticker: PWV)
The PowerShares Dynamic Large Cap Value Portfolio is based on the Dynamic Large Cap Value IntellidexSM Index which seeks to provide capital appreciation while maintaining consistent and stylistically accurate exposure.
The PowerShares Dynamic Large Cap Value Portfolio underperformed over the reporting period down -4.78% due to value underperforming growth for the year. The fund did well against its peers the Russell 1000 Value Index, down 8.97%, and the S&P Large Cap Value Index, down 8.76%. Energy was the second largest sector by weight and was the leading contributor to the Fund's performance with Chevron, Hess, Occidental Petroleum, Exxon Mobil and Apache leading the way. As energy prices continued to rise throughout the year, these stocks performed well. Financials were the most heavily weighted sector and the largest laggard as the entire sector was down sharply as Morgan Stanley, AIG, Citigroup and Bank of America being the biggest underperformers. The subprime crisis which started in 2007 and continued into 2008 took its toll on all financials as the economy slowed and many feared a recession.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 32.7 | ||||||
Energy | 17.5 | ||||||
Health Care | 10.0 | ||||||
Consumer Staples | 9.8 | ||||||
Telecommunication Services | 7.0 | ||||||
Consumer Discretionary | 6.3 | ||||||
Information Technology | 6.1 | ||||||
Utilities | 5.8 | ||||||
Industrials | 4.6 | ||||||
Money Market Fund | 0.1 | ||||||
Other | 0.1 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 96.1 | ||||||
Large-Cap Growth | 3.9 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
JPMorgan Chase & Co. | 3.8 | ||||||
Goldman Sachs Group (The), Inc. | 3.6 | ||||||
AT&T, Inc. | 3.6 | ||||||
Chevron Corp. | 3.6 | ||||||
McDonald's Corp. | 3.5 | ||||||
Johnson & Johnson | 3.5 | ||||||
Exxon Mobil Corp. | 3.5 | ||||||
Verizon Communications, Inc. | 3.4 | ||||||
International Business Machines Corp. | 3.4 | ||||||
ConocoPhillips | 3.3 | ||||||
Total | 35.2 |
12
Manager's Analysis (Continued)
PowerShares Dynamic Large Cap Value Portfolio (ticker: PWV)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||||||||||
1 Year | 3 Year | Avg. Ann.† | Cumulative | ||||||||||||||||||||
Dynamic Large Cap Value IntellidexSM Index | -4.17 | 12.63 | 10.84 | 38.56 | |||||||||||||||||||
Russell 1000® Value Index | -8.97 | 8.36 | 6.62 | 22.53 | |||||||||||||||||||
S&P Citigroup Large Cap Value Index | -8.76 | 8.81 | 6.80 | 23.19 |
Fund
NAV Return | -4.78 | 11.88 | 10.14 | 35.68 | |||||||||||||||||||
Share Price Return | -5.28 | 11.65 | 9.91 | 34.84 |
Fund Inception: 3 March 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.66%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.59%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Russell 1000® Value Index and the S&P Citigroup Large Cap Value Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 617 and 346, respectively, widely held stocks.
† Average annualized.
13
Manager's Analysis
PowerShares Dynamic Mid Cap Growth Portfolio (ticker: PWJ)
The PowerShares Dynamic Mid Cap Growth Portfolio is based on the Dynamic Mid Cap Growth IntellidexSM Index which seeks to provide capital appreciation while maintaining consistent and stylistically accurate exposure.
The PowerShares Dynamic Mid Cap Growth Portfolio performed the best of the three PowerShares growth funds, posting a solid 5.70% return for the reporting period. The highest contributing sector was industrials with Fluor Corporation and C.H. Robinson Worldwide making solid contributions. An underweight in Energy and positive stock selection in financials also contributed to the Funds positive returns. Telecommunication services contributed significantly to the Fund's underperformance with U.S. Cellular being the Fund's largest laggard.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Information Technology | 33.0 | ||||||
Industrials | 19.1 | ||||||
Energy | 12.2 | ||||||
Health Care | 11.2 | ||||||
Consumer Discretionary | 10.6 | ||||||
Utilities | 6.5 | ||||||
Financials | 5.2 | ||||||
Consumer Staples | 1.0 | ||||||
Materials | 0.6 | ||||||
Telecommunication Services | 0.5 | ||||||
Other | 0.1 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Mid-Cap Growth | 76.8 | ||||||
Large-Cap Growth | 18.8 | ||||||
Small-Cap Growth | 2.3 | ||||||
Mid-Cap Value | 2.1 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
GameStop Corp. | 3.8 | ||||||
Amphenol Corp. | 3.7 | ||||||
CH Robinson Worldwide, Inc. | 3.6 | ||||||
Autodesk, Inc. | 3.6 | ||||||
FMC Technologies, Inc. | 3.5 | ||||||
Cameron International Corp. | 3.4 | ||||||
Paychex, Inc. | 3.4 | ||||||
Noble Corp. | 3.4 | ||||||
Reliant Energy, Inc. | 3.3 | ||||||
NetApp, Inc. | 3.3 | ||||||
Total | 35.0 |
14
Manager's Analysis (Continued)
PowerShares Dynamic Mid Cap Growth Portfolio (ticker: PWJ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||||||||||
1 Year | 3 Year | Avg. Ann.† | Cumulative | ||||||||||||||||||||
Dynamic Mid Cap Growth IntellidexSM Index | 6.37 | 18.07 | 14.30 | 52.72 | |||||||||||||||||||
Russell Mid Cap Growth Index | -1.93 | 11.81 | 9.06 | 31.63 | |||||||||||||||||||
S&P Citigroup Mid Cap Growth Index | 2.02 | 11.83 | 9.07 | 31.68 |
Fund
NAV Return | 5.70 | 17.26 | 13.55 | 49.40 | |||||||||||||||||||
Share Price Return | 5.75 | 17.27 | 13.50 | 49.25 |
Fund Inception: 3 March 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.72%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.60%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Russell Mid Cap Growth Index and the S&P Citigroup Mid Cap Growth Index are unmanaged indices used as a measurements of change in stock market conditions based on the average performance of approximately 548 and 258, respectively, widely held stocks.
† Average annualized.
15
Manager's Analysis
PowerShares Dynamic Mid Cap Portfolio (ticker: PJG)
The PowerShares Dynamic Mid Cap Portfolio is based on the Dynamic Mid Cap IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Mid Cap Portfolio posted an -8.54% return for the reporting period. Positive stock selection within industrials contributed positively to the Fund's performance. Consumer discretionary, financials and telecommunication services were the laggards for the reporting period as poor allocation within sectors contributed to Fund's underperformance.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Information Technology | 21.6 | ||||||
Industrials | 21.5 | ||||||
Financials | 11.9 | ||||||
Consumer Discretionary | 9.5 | ||||||
Energy | 7.9 | ||||||
Health Care | 7.9 | ||||||
Consumer Staples | 7.3 | ||||||
Materials | 4.6 | ||||||
Utilities | 4.2 | ||||||
Telecommunication Services | 3.6 | ||||||
Money Market Fund | 0.4 | ||||||
Other | (0.4 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Mid-Cap Growth | 44.4 | ||||||
Mid-Cap Value | 29.8 | ||||||
Large-Cap Value | 13.1 | ||||||
Large-Cap Growth | 9.6 | ||||||
Small-Cap Value | 1.9 | ||||||
Small-Cap Growth | 1.2 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Amphenol Corp., Class A | 1.9 | ||||||
Cummins, Inc. | 1.9 | ||||||
Parker Hannifin Corp. | 1.9 | ||||||
CH Robinson Worldwide, Inc. | 1.9 | ||||||
Autodesk, Inc. | 1.8 | ||||||
Analog Devics, Inc. | 1.8 | ||||||
Dover Corp. | 1.8 | ||||||
Coach, Inc. | 1.8 | ||||||
Cameron International Corp. | 1.7 | ||||||
Paychex, Inc. | 1.7 | ||||||
Total | 18.2 |
16
Manager's Analysis (Continued)
PowerShares Dynamic Mid Cap Portfolio (ticker: PJG)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Mid Cap IntellidexSM Index | -7.87 | 1.81 | 2.57 | ||||||||||||
S&P Mid Cap 400® Index | -2.75 | 3.84 | 5.47 | ||||||||||||
Russell Mid Cap Index | -6.34 | 1.21 | 1.72 |
Fund
NAV Return | -8.54 | 1.10 | 1.56 | ||||||||||||
Share Price Return | -8.60 | 1.12 | 1.59 |
Fund Inception: 1 December 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 2.12%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.73% while the Fund's gross total operating expense ratio was 1.34%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Mid Cap 400® Index and the Russell Mid Cap Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 400 and 796, respectively, widely held stocks.
† Average annualized.
17
Manager's Analysis
PowerShares Dynamic Mid Cap Value Portfolio (ticker: PWP)
The PowerShares Dynamic Mid Cap Value Portfolio is based on the Dynamic Mid Cap Value IntellidexSM Index which seeks to provide capital appreciation while maintaining consistent and stylistically accurate exposure.
The PowerShares Dynamic Mid Cap Value Portfolio underperformed as value lagged growth for the year. The Fund returned -15.47% as financials, consumer discretionary and telecommunication services sectors contributed the most to Fund's underperformance. Poor allocation and stock selection within the financials contributed negatively to the Fund's performance such as XL Capital, Ambac Financial Group and CNA Financial. While energy had a positive return for the Fund, the stock selection contributed to the underperformance compared to its peers. Nobel Energy was one of the bright spots for the Fund as it as up nearly 50% for the year and contributed positively to the Fund's return.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 21.6 | ||||||
Consumer Discretionary | 17.2 | ||||||
Consumer Staples | 14.1 | ||||||
Industrials | 12.5 | ||||||
Information Technology | 7.9 | ||||||
Energy | 7.1 | ||||||
Telecommunication Services | 6.6 | ||||||
Utilities | 5.6 | ||||||
Materials | 4.3 | ||||||
Health Care | 3.1 | ||||||
Money Market Fund | 0.2 | ||||||
Other | (0.2 | ) |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Mid-Cap Value | 79.7 | ||||||
Large-Cap Value | 16.9 | ||||||
Small-Cap Value | 2.2 | ||||||
Mid-Cap Growth | 0.6 | ||||||
Small-Cap Growth | 0.6 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Dover Corp. | 3.8 | ||||||
Sara Lee Corp. | 3.6 | ||||||
Noble Energy, Inc. | 3.5 | ||||||
AON Corp. | 3.4 | ||||||
Eaton Corp. | 3.4 | ||||||
Campbell Soup Co. | 3.4 | ||||||
Fortune Brands, Inc. | 3.3 | ||||||
Assurant, Inc. | 3.3 | ||||||
Unum Group | 3.2 | ||||||
DTE Energy Co. | 3.2 | ||||||
Total | 34.1 |
18
Manager's Analysis (Continued)
PowerShares Dynamic Mid Cap Value Portfolio (ticker: PWP)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||||||
1 Year | 3 Year | Avg. Ann.† | Cumulative | ||||||||||||||||
Dynamic Mid Cap Value IntellidexSM Index | -14.95 | 7.65 | 5.86 | 19.77 | |||||||||||||||
Russell Mid Cap Value Index | -11.65 | 9.66 | 7.78 | 26.79 | |||||||||||||||
S&P Citigroup Mid Cap Value Index | -7.38 | 10.40 | 7.89 | 27.22 |
Fund
NAV Return | -15.47 | 6.77 | 5.04 | 16.79 | |||||||||||||||
Share Price Return | -15.78 | 6.70 | 4.87 | 16.24 |
Fund Inception: 3 March 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.79%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.68%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Russell Mid Cap Value Index and the S&P Citigroup Mid Cap Value Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 483 and 285, respectively, widely held stocks.
† Average annualized.
19
Manager's Analysis
PowerShares Dynamic Small Cap Growth Portfolio (ticker: PWT)
The PowerShares Dynamic Small Cap Growth Portfolio is based on the Dynamic Small Cap Growth IntellidexSM Index which seeks to provide capital appreciation while maintaining consistent and stylistically accurate exposure.
The PowerShares Dynamic Small Cap Growth Portfolio posted the weakest results of the six PowerShares style funds during the fiscal year, returning -15.49%. Stock selection within the information technology, health care and industrials sectors contributed to the Fund's underperformance. FormFactor Inc., Charter Communications, DealerTrack Holdings and NutriSystem Inc. were largest laggards. Positive stock selection within the energy sector and solid results from Alpha Natural Resources, Sohu.com and Ventana Medical Systems and Netflix contributed positively to the Fund's performance.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Information Technology | 39.7 | ||||||
Health Care | 25.3 | ||||||
Consumer Discretionary | 10.5 | ||||||
Industrials | 9.9 | ||||||
Energy | 6.3 | ||||||
Financials | 5.1 | ||||||
Utilities | 2.3 | ||||||
Telecommunication Services | 0.5 | ||||||
Materials | 0.4 | ||||||
Other | (0.0 | ) |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Small-Cap Growth | 88.6 | ||||||
Small-Cap Value | 9.0 | ||||||
Mid-Cap Value | 2.4 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Sohu.com, Inc. | 3.4 | ||||||
Comstock Resources, Inc. | 2.8 | ||||||
Deckers Outdoor Corp. | 2.8 | ||||||
Orbital Sciences Corp. | 2.8 | ||||||
Warnaco Group (The), Inc. | 2.7 | ||||||
Gartner, Inc. | 2.7 | ||||||
Boi's d'Arc Energy, Inc. | 2.5 | ||||||
SRA International, Inc., Class A | 2.4 | ||||||
Silicon Laboratories, Inc. | 2.4 | ||||||
Solera Holdings, Inc. | 2.4 | ||||||
Total | 26.9 |
20
Manager's Analysis (Continued)
PowerShares Dynamic Small Cap Growth Portfolio (ticker: PWT)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||||||
1 Year | 3 Year | Avg. Ann.† | Cumulative | ||||||||||||||||
Dynamic Small Cap Growth IntellidexSM Index | -15.17 | 4.59 | 1.66 | 5.35 | |||||||||||||||
Russell 2000® Growth Index | -6.71 | 9.90 | 5.71 | 19.23 | |||||||||||||||
S&P Citigroup Small Cap Growth Index | -4.80 | 9.86 | 5.99 | 20.24 |
Fund
NAV Return | -15.49 | 4.16 | 1.24 | 3.97 | |||||||||||||||
Share Price Return | -15.55 | 4.27 | 1.17 | 3.73 |
Fund Inception: 3 March 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.81%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.77%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Russell 2000® Growth Index and the S&P Citigroup Small Cap Growth Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 1,245 and 362 widely held stocks, respectively.
† Average annualized.
21
Manager's Analysis
PowerShares Dynamic Small Cap Portfolio (ticker: PJM)
The PowerShares Dynamic Small Cap Portfolio is based on the Dynamic Small Cap IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Small Cap Portfolio posted a -11.61% return during the reporting period. Small cap stocks underperformed their large cap and mid cap peers across all styles. Positive stock selection within the energy sector such as stocks like Massey Energy, Alpha Natural Resources and W&T Offshore contributed positively to the funds performance. An overweight position in financials, consumer discretionary and industrials were the largest contributors to the Fund's underperformance.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Industrials | 21.5 | ||||||
Information Technology | 20.8 | ||||||
Financials | 16.7 | ||||||
Consumer Discretionary | 13.5 | ||||||
Health Care | 10.2 | ||||||
Consumer Staples | 5.8 | ||||||
Materials | 4.5 | ||||||
Energy | 3.8 | ||||||
Utilities | 2.6 | ||||||
Telecommunication Services | 0.4 | ||||||
Money Market Fund | 0.5 | ||||||
Other | (0.3 | ) |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Small-Cap Value | 65.2 | ||||||
Small-Cap Growth | 34.6 | ||||||
Mid-Cap Value | 0.2 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Sohu.com, Inc. | 1.7 | ||||||
UMB Financial Corp. | 1.4 | ||||||
ADTRAN, Inc. | 1.4 | ||||||
Integrated Device Technology, Inc. | 1.4 | ||||||
Actuant Corp., Class A | 1.4 | ||||||
Gardner Denver, Inc. | 1.4 | ||||||
Orbital Sciences Corp. | 1.4 | ||||||
Wabtec Corp. | 1.4 | ||||||
Westamerica Bancorp | 1.4 | ||||||
Warnaco Group (The), Inc. | 1.4 | ||||||
Total | 14.3 |
22
Manager's Analysis (Continued)
PowerShares Dynamic Small Cap Portfolio (ticker: PJM)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Small Cap IntellidexSM Index | -10.96 | -3.72 | -5.22 | ||||||||||||
S&P Small Cap 600® Index | -9.04 | -2.57 | -3.62 | ||||||||||||
Russell 2000® Index | -10.96 | -4.78 | -6.70 |
Fund
NAV Return | -11.61 | -4.51 | -6.30 | ||||||||||||
Share Price Return | -11.69 | -4.55 | -6.36 |
Fund Inception: 1 December 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 2.09%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.79% while the Fund's gross total operating expense ratio was 1.96%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Small Cap 600® Index and the Russell 2000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 600 and 2,000, respectively, widely held stocks.
† Average annualized.
23
Manager's Analysis
PowerShares Dynamic Small Cap Value Portfolio (ticker: PWY)
The PowerShares Dynamic Small Cap Value Portfolio is based on the Dynamic Small Cap Value IntellidexSM Index which seeks to provide capital appreciation while maintaining consistent and stylistically accurate exposure.
The PowerShares Dynamic Small Cap Value Portfolio posted a -12.51% return over the reporting period. Small cap stocks underperformed during the period but small cap value outperformed small cap growth. Stock selection within Industrials and allocation with consumer discretionary and financials contributed the Fund's underperformance. Deluxe Corporation, HNI Corporation and Ceradyne within industrials and Collective Brands within consumer discretionary were the leading laggards. As energy prices rose, the energy sector was a positive contributor due to overweight positions and solid performance from W&T Offshore, Western Refining and Berry Petroleum.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 22.3 | ||||||
Industrials | 15.3 | ||||||
Consumer Discretionary | 15.0 | ||||||
Information Technology | 14.5 | ||||||
Consumer Staples | 9.2 | ||||||
Materials | 7.9 | ||||||
Utilities | 7.4 | ||||||
Energy | 6.7 | ||||||
Health Care | 1.2 | ||||||
Telecommunication Services | 0.4 | ||||||
Money Market Fund | 0.0 | ||||||
Other | 0.1 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Small-Cap Value | 96.1 | ||||||
Small-Cap Growth | 3.9 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
UMB Financial Corp. | 2.9 | ||||||
ADTRAN, Inc. | 2.8 | ||||||
Integrated Device Technology, Inc. | 2.8 | ||||||
Westamerica Bancorp | 2.7 | ||||||
Polaris Industries, Inc. | 2.7 | ||||||
Berry Petroleum Co., Class A | 2.7 | ||||||
Ruddick Corp. | 2.6 | ||||||
Oil States International, Inc. | 2.6 | ||||||
Fairchild Semiconductor International, Inc. | 2.6 | ||||||
Knight Capital Group, Inc., Class A | 2.6 | ||||||
Total | 27.0 |
24
Manager's Analysis (Continued)
PowerShares Dynamic Small Cap Value Portfolio (ticker: PWY)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||||||
1 Year | 3 Year | Avg. Ann.† | Cumulative | ||||||||||||||||
Dynamic Small Cap Value IntellidexSM Index | -12.02 | 7.10 | 3.81 | 12.57 | |||||||||||||||
Russell 2000® Value Index | -15.13 | 7.29 | 4.12 | 13.63 | |||||||||||||||
S&P Citigroup Small Cap Value Index | -12.87 | 7.70 | 4.46 | 14.83 |
Fund
NAV Return | -12.51 | 6.33 | 3.09 | 10.08 | |||||||||||||||
Share Price Return | -12.62 | 6.38 | 3.00 | 9.80 |
Fund Inception: 3 March 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.78%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.67%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Russell 2000® Value Index and the S&P Citigroup Small Cap Value Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 1,279 and 467, respectively, widely held stocks.
† Average annualized.
25
Manager's Analysis
PowerShares FTSE NASDAQ Small Cap Portfolio (ticker: PQSC)
The PowerShares FTSE NASDAQ Small Cap Portfolio (Fund) is based on the FTSE NASDAQ Small Cap Index (Index), which is designed to track the performance of the smallest 10% of companies in the FTSE NASDAQ Index. Eligible securities include common stock, american depositary receipts and real estate investment trusts. The Index is float-adjusted market capitalization weighted on an annual basis.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Information Technology | 25.9 | ||||||
Health Care | 19.5 | ||||||
Financials | 17.0 | ||||||
Industrials | 14.4 | ||||||
Consumer Discretionary | 9.6 | ||||||
Energy | 4.9 | ||||||
Consumer Staples | 3.2 | ||||||
Materials | 2.5 | ||||||
Telecommunication Services | 2.0 | ||||||
Utilities | 0.7 | ||||||
Money Market Fund | 0.0 | ||||||
Other | 0.3 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Small-Cap Growth | 62.4 | ||||||
Small-Cap Value | 34.7 | ||||||
Mid-Cap Growth | 1.9 | ||||||
Large-Cap Growth | 0.5 | ||||||
Mid-Cap Value | 0.4 | ||||||
Large-Cap Value | 0.1 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Cybersource Corp. | 0.4 | ||||||
Savient Pharmaceuticals, Inc. | 0.4 | ||||||
Chart Industries, Inc. | 0.4 | ||||||
Exide Technologies | 0.4 | ||||||
American Superconductor Corp. | 0.4 | ||||||
Tesco Corp. (Canada) | 0.4 | ||||||
Mantech International Corp., Class A | 0.3 | ||||||
TriQuint Semiconductor, Inc. | 0.3 | ||||||
Power Integrations, Inc. | 0.3 | ||||||
Incyte Corp. | 0.3 | ||||||
Total | 3.6 |
26
Manager's Analysis (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio (ticker: PQSC)
Fund Performance History (%) As of 30 April 2008
Index
Fund Inception Cumulative | |||||||
FTSE NASDAQ Small Cap Index | -0.58 | ||||||
S&P Small Cap 600® Index | 0.14 | ||||||
Russell 2000® Index | 0.43 |
Fund
NAV Return | -0.50 | ||||||
Share Price Return | -0.68 |
Fund Inception: 3 April 2008
Performance data quoted represents past performance. Past performance is not a guarantee of future results, current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. According to the Fund's current prospectus, the expense ratio of 0.70% is expressed as a unitary fee to cover operating expenses and expenses incurred in connection with managing the portfolio. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The index performance results are hypothetical. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Small Cap 600® Index and Russell 2000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 600 and 2,000 common stocks, respectively.
27
Manager's Analysis
PowerShares Zacks Micro Cap Portfolio (ticker: PZI)
The PowerShares Zacks Micro Cap Portfolio seeks to replicate, before fees and expenses, the Zacks Micro Cap Index, which is designed to identify a group of micro cap stocks with the greatest potential to outperform passive benchmark micro cap indices and other actively managed U.S. micro cap strategies. Due to their low correlation to large, medium and small sized companies, micro caps may complement existing blended portfolios by improving risk adjusted performance.
The PowerShares Zacks Micro Cap Portfolio returned -25.07% over the past year underperforming the Russell Micro Cap Index which returned -19.64% over the same period.
For the year ended April 30, 2008 one of the ten sectors represented in the Fund generated positive returns. The main factor which dictated performance was the Fund's overexposure to microcap stocks which were heavily affected more significantly during the economic downturn. The following sectors were the largest negative contributor to the Fund: information technology, consumer discretionary, financials, and health care. Together, these sectors generated 82% of the Fund's negative returns. Consumer staples was the only sector which generated positive returns for the Fund.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 24.8 | ||||||
Information Technology | 20.9 | ||||||
Industrials | 19.8 | ||||||
Consumer Discretionary | 12.9 | ||||||
Health Care | 7.1 | ||||||
Energy | 6.3 | ||||||
Materials | 4.1 | ||||||
Consumer Staples | 2.6 | ||||||
Utilities | 1.0 | ||||||
Telecommunication Services | 0.7 | ||||||
Money Market Fund | 0.2 | ||||||
Other | (0.4 | ) |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Small-Cap Value | 56.4 | ||||||
Small-Cap Growth | 43.0 | ||||||
Mid-Cap Growth | 0.6 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Graham Corp. | 0.4 | ||||||
Immersion Corp. | 0.4 | ||||||
Brigham Exploration Co. | 0.4 | ||||||
Ultratech, Inc. | 0.4 | ||||||
LaBranche & Co., Inc. | 0.4 | ||||||
SIFCO Industries, Inc. | 0.3 | ||||||
Excel Maritime Carriers Ltd. | 0.3 | ||||||
Metalico, Inc. | 0.3 | ||||||
Inter Parfums, Inc. | 0.3 | ||||||
Canadian Solar, Inc. (China) | 0.3 | ||||||
Total | 3.5 |
28
Manager's Analysis (Continued)
PowerShares Zacks Micro Cap Portfolio (ticker: PZI)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Zacks Micro Cap Index | -25.58 | -2.90 | -7.66 | ||||||||||||
Russell Micro Cap Index | -19.64 | -0.01 | -0.03 | ||||||||||||
S&P 500® Index | -4.68 | 6.84 | 19.61 |
Fund
NAV Return | -25.07 | -2.66 | -7.02 | ||||||||||||
Share Price Return | -24.86 | -2.73 | -7.21 |
Fund Inception: 18 August 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.76%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.70% while the Fund's gross total operating expense ratio was 0.71%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Russell Micro Cap Index and the S&P 500® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 2,000 and 500 common stocks, respectively.
† Average annualized.
29
Manager's Analysis
PowerShares Zacks Small Cap Portfolio (ticker: PZJ)
The PowerShares Zacks Small Cap Portfolio is based on the Zacks Small Cap Index. The index is designed to identify a group of small cap stocks with the greatest potential to outperform passive benchmark small cap indices and other actively managed U.S. small cap strategies. The portfolio is rebalanced and reconstituted quarterly.
The PowerShares Zacks Small Cap Portfolio returned -14.66%, underperforming the S&P Small Cap Index which was down -9.04% and the Russell 2000® Index which was down -10.96%. The Fund underperformed the S&P Small Cap due to the fact that the Fund was more focused in small cap whereas the S&P Index had some mid cap exposure. Sector allocation had little impact on the Fund's performance. Stock selection within the small cap value allocation negatively impacted Fund performance.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Information Technology | 20.0 | ||||||
Industrials | 17.0 | ||||||
Consumer Discretionary | 16.0 | ||||||
Financials | 15.6 | ||||||
Health Care | 11.6 | ||||||
Energy | 9.5 | ||||||
Materials | 6.2 | ||||||
Consumer Staples | 2.4 | ||||||
Utilities | 1.3 | ||||||
Telecommunication Services | 0.7 | ||||||
Money Market Fund | 0.1 | ||||||
Other | (0.4 | ) |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Small-Cap Growth | 55.2 | ||||||
Small-Cap Value | 44.1 | ||||||
Mid-Cap Value | 0.7 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Rex Energy Corp. | 0.8 | ||||||
Overstock.com, Inc. | 0.8 | ||||||
Cognex Corp. | 0.7 | ||||||
Jones Apparel Group, Inc. | 0.7 | ||||||
GTx, Inc. | 0.6 | ||||||
CryoLife, Inc. | 0.6 | ||||||
Valassis Communications, Inc. | 0.6 | ||||||
Monolithic Power Systems, Inc. | 0.6 | ||||||
Allis-Chalmers Energy, Inc. | 0.6 | ||||||
Koppers Holdings, Inc. | 0.6 | ||||||
Total | 6.6 |
30
Manager's Analysis (Continued)
PowerShares Zacks Small Cap Portfolio (ticker: PZJ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Zacks Small Cap Index | -14.77 | -3.59 | -7.75 | ||||||||||||
S&P Small Cap 600® Index | -9.04 | 1.20 | 2.66 | ||||||||||||
Russell 2000® Index | -10.96 | 0.23 | 0.50 |
Fund
NAV Return | -14.66 | -3.44 | -7.41 | ||||||||||||
Share Price Return | -14.64 | -3.49 | -7.53 |
Fund Inception: 16 February 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.89%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.70% while the Fund's gross total operating expense ratio was 0.83%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Small Cap 600® Index and the Russell 2000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 600 and 2,000 common stocks, respectively.
† Average annualized.
31
Funds' Distribution History
Ex-Dividend | 3/20/08 | 12/21/07 | 9/21/07 | 6/15/07 | 3/16/07 | 12/15/06 | |||||||||||||||||||||||||
Record | 3/25/08 | 12/26/07 | 9/25/07 | 6/19/07 | 3/20/07 | 12/19/06 | |||||||||||||||||||||||||
Payable | 3/31/08 | 12/31/07 | 9/28/07 | 6/29/07 | 3/30/07 | 12/29/06 | |||||||||||||||||||||||||
Fund | Ticker | ||||||||||||||||||||||||||||||
PowerShares Dynamic Aggressive Growth Portfolio | PGZ | — | — | — | — | — | NA | ||||||||||||||||||||||||
PowerShares Dynamic Deep Value Portfolio | PVM | 0.06563 | 0.08384 | 0.09118 | 0.20027 | 0.07260 | NA | ||||||||||||||||||||||||
PowerShares Dynamic Large Cap Growth Portfolio | PWB | — | 0.03572 | — | — | — | 0.01906 | ||||||||||||||||||||||||
PowerShares Dynamic Large Cap Portfolio | PJF | 0.01231 | 0.04532 | 0.06897 | 0.08510 | 0.05700 | 0.01958 | ||||||||||||||||||||||||
PowerShares Dynamic Large Cap Value Portfolio | PWV | 0.08707 | 0.12120 | 0.12283 | 0.15210 | 0.06823 | 0.11068 | ||||||||||||||||||||||||
PowerShares Dynamic Mid Cap Growth Portfolio | PWJ | — | 0.00199 | — | — | — | 0.09682 | ||||||||||||||||||||||||
PowerShares Dynamic Mid Cap Portfolio | PJG | 0.01563 | 0.03521 | 0.02150 | 0.05902 | 0.02010 | 0.04345 | ||||||||||||||||||||||||
PowerShares Dynamic Mid Cap Value Portfolio | PWP | 0.06085 | 0.04685 | 0.05149 | 0.09609 | 0.03230 | 0.11224 | ||||||||||||||||||||||||
PowerShares Dynamic Small Cap Growth Portfolio | PWT | — | — | — | — | — | — | ||||||||||||||||||||||||
PowerShares Dynamic Small Cap Portfolio | PJM | — | 0.15885 | — | 0.14483 | — | 0.00194 | ||||||||||||||||||||||||
PowerShares Dynamic Small Cap Value Portfolio | PWY | 0.01508 | 0.47943 | 0.03122 | 0.04787 | 0.03120 | 0.05147 | ||||||||||||||||||||||||
PowerShares FTSE NASDAQ Small Cap Portfolio | PQSC | — | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Zacks Micro Cap Portfolio | PZI | — | 0.06529 | 0.02290 | 0.03004 | — | 0.02151 | ||||||||||||||||||||||||
PowerShares Zacks Small Cap Portfolio | PZJ | — | 0.18914 | — | — | 0.01358 | 0.01065 |
32
9/15/06 | 6/16/06 | 3/17/06 | 12/16/05 | 9/16/05 | 6/17/05 | 3/18/05 | |||||||||||||||||||||||||
9/16/06 | 6/20/06 | 3/21/06 | 12/20/05 | 9/20/05 | 6/21/05 | 3/22/05 | |||||||||||||||||||||||||
9/29/06 | 6/30/06 | 3/30/06 | 12/30/05 | 9/30/05 | 6/30/05 | 4/29/05 | |||||||||||||||||||||||||
Fund | |||||||||||||||||||||||||||||||
PowerShares Dynamic Aggressive Growth Portfolio | NA | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Dynamic Deep Value Portfolio | NA | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Dynamic Large Cap Growth Portfolio | — | 0.00120 | — | 0.00241 | — | — | — | ||||||||||||||||||||||||
PowerShares Dynamic Large Cap Portfolio | NA | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Dynamic Large Cap Value Portfolio | 0.05101 | 0.05675 | 0.04783 | 0.07647 | 0.05490 | 0.06233 | 0.01222 | ||||||||||||||||||||||||
PowerShares Dynamic Mid Cap Growth Portfolio | — | 0.01708 | — | — | — | — | — | ||||||||||||||||||||||||
PowerShares Dynamic Mid Cap Portfolio | NA | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Dynamic Mid Cap Value Portfolio | 0.03813 | 0.05155 | 0.03356 | 0.12251 | 0.04806 | 0.04852 | 0.02010 | ||||||||||||||||||||||||
PowerShares Dynamic Small Cap Growth Portfolio | — | — | — | — | — | — | — | ||||||||||||||||||||||||
PowerShares Dynamic Small Cap Portfolio | NA | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Dynamic Small Cap Value Portfolio | 0.02539 | 0.02139 | 0.01644 | 0.02879 | 0.02835 | 0.03471 | — | ||||||||||||||||||||||||
PowerShares FTSE NASDAQ Small Cap Portfolio | NA | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Zacks Micro Cap Portfolio | — | — | — | 0.01012 | — | NA | NA | ||||||||||||||||||||||||
PowerShares Zacks Small Cap Portfolio | 0.01385 | 0.01784 | — | NA | NA | NA | NA |
33
Frequency Distribution of Discounts & Premiums
Since Inception through April 30, 2008
Closing Price Above NAV (bps) | |||||||||||||||||||||||||||||||||||||||
Ticker | Fund Name | Inception | Days | 0-24 Basis Points | 25-49 Basis Points | 50-99 Basis Points | 100-149 Basis Points | 150-199 Basis Points | 200+ Basis Points | ||||||||||||||||||||||||||||||
PGZ | PowerShares Dynamic Aggressive Growth Portfolio | 12/20/06 | 341 | 109 | 15 | 2 | — | — | — | ||||||||||||||||||||||||||||||
PVM | PowerShares Dynamic Deep Value Portfolio | 12/20/06 | 341 | 147 | 10 | — | — | — | — | ||||||||||||||||||||||||||||||
PWB | PowerShares Dynamic Large Cap Growth Portfolio | 03/03/05 | 796 | 465 | 30 | 1 | — | — | — | ||||||||||||||||||||||||||||||
PJF | PowerShares Dynamic Large Cap Portfolio | 12/01/06 | 354 | 141 | 6 | 1 | — | — | — | ||||||||||||||||||||||||||||||
PWV | PowerShares Dynamic Large Cap Value Portfolio | 03/03/05 | 796 | 490 | 23 | 7 | — | — | — | ||||||||||||||||||||||||||||||
PWJ | PowerShares Dynamic Mid Cap Growth Portfolio | 03/03/05 | 796 | 413 | 15 | 4 | — | — | — | ||||||||||||||||||||||||||||||
PJG | PowerShares Dynamic Mid Cap Portfolio | 12/01/06 | 354 | 168 | 13 | — | — | — | — | ||||||||||||||||||||||||||||||
PWP | PowerShares Dynamic Mid Cap Value Portfolio | 03/03/05 | 796 | 386 | 10 | 2 | — | — | — | ||||||||||||||||||||||||||||||
PWT | PowerShares Dynamic Small Cap Growth Portfolio | 03/03/05 | 796 | 395 | 32 | 4 | — | — | — | ||||||||||||||||||||||||||||||
PJM | PowerShares Dynamic Small Cap Portfolio | 12/01/06 | 354 | 137 | 7 | — | — | — | — | ||||||||||||||||||||||||||||||
PWY | PowerShares Dynamic Small Cap Value Portfolio | 03/03/05 | 796 | 409 | 29 | 5 | — | — | — | ||||||||||||||||||||||||||||||
PQSC | PowerShares FTSE NASDAQ Small Cap Portfolio | 04/03/08 | 20 | 10 | 1 | — | — | — | — | ||||||||||||||||||||||||||||||
PZI | PowerShares Zacks Micro Cap Portfolio | 08/18/05 | 679 | 257 | 19 | 7 | — | — | — | ||||||||||||||||||||||||||||||
PZJ | PowerShares Zacks Small Cap Portfolio | 02/16/06 | 553 | 273 | 9 | 1 | — | — | — |
34
Closing Price Below NAV (bps) | |||||||||||||||||||||||||||
Ticker | -0-24 Basis Points | -25-49 Basis Points | -50-99 Basis Points | -100-149 Basis Points | -150-199 Basis Points | -200+ Basis Points | |||||||||||||||||||||
PGZ | 201 | 14 | — | — | — | — | |||||||||||||||||||||
PVM | 181 | 3 | — | — | — | — | |||||||||||||||||||||
PWB | 290 | 9 | 1 | — | — | — | |||||||||||||||||||||
PJF | 206 | — | — | — | — | — | |||||||||||||||||||||
PWV | 264 | 8 | 4 | — | — | — | |||||||||||||||||||||
PWJ | 357 | 6 | 1 | — | — | — | |||||||||||||||||||||
PJG | 171 | 2 | — | — | — | — | |||||||||||||||||||||
PWP | 395 | 3 | — | — | — | — | |||||||||||||||||||||
PWT | 340 | 22 | 3 | — | — | — | |||||||||||||||||||||
PJM | 203 | 7 | — | — | — | — | |||||||||||||||||||||
PWY | 334 | 15 | 4 | — | — | — | |||||||||||||||||||||
PQSC | 9 | — | — | — | — | — | |||||||||||||||||||||
PZI | 377 | 18 | 1 | — | — | — | |||||||||||||||||||||
PZJ | 266 | 4 | — | — | — | — |
35
Fees and Expenses
As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, you incur Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month (or shorter) period ended April 30, 2008.
Actual Expenses
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, 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 first line under the heading "Expenses Paid During the Six-Month Period" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds' actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Funds' 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 Funds 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 tables are meant to highlight your ongoing costs only, and do not reflect any transactional costs such as sales charges (loads). Therefore the second line in the table 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 transactional costs were included, your costs would have been higher.
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Dynamic Aggressive Growth Portfolio Actual | $ | 1,000.00 | $ | 854.20 | 0.74 | % | $ | 3.41 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.18 | 0.74 | % | $ | 3.72 | |||||||||||
PowerShares Dynamic Deep Value Portfolio | |||||||||||||||||||
Actual | $ | 1,000.00 | $ | 927.47 | 0.77 | % | $ | 3.69 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.03 | 0.77 | % | $ | 3.87 | |||||||||||
PowerShares Dynamic Large Cap Growth Portfolio | |||||||||||||||||||
Actual | $ | 1,000.00 | $ | 905.74 | 0.63 | % | $ | 2.99 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Large Cap Portfolio | |||||||||||||||||||
Actual | $ | 1,000.00 | $ | 910.75 | 0.67 | % | $ | 3.18 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.53 | 0.67 | % | $ | 3.37 | |||||||||||
PowerShares Dynamic Large Cap Value Portfolio | |||||||||||||||||||
Actual | $ | 1,000.00 | $ | 916.87 | 0.63 | % | $ | 3.00 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Mid Cap Growth Portfolio | |||||||||||||||||||
Actual | $ | 1,000.00 | $ | 899.22 | 0.63 | % | $ | 2.97 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 |
36
Fees and Expenses (Unaudited) (Continued)
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Mid Cap Portfolio Actual | $ | 1,000.00 | $ | 897.94 | 0.67 | % | $ | 3.16 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.53 | 0.67 | % | $ | 3.37 | |||||||||||
PowerShares Dynamic Mid Cap Value Portfolio Actual | $ | 1,000.00 | $ | 858.81 | 0.63 | % | $ | 2.91 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Small Cap Growth Portfolio Actual | $ | 1,000.00 | $ | 832.54 | 0.63 | % | $ | 2.87 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Small Cap Portfolio Actual | $ | 1,000.00 | $ | 897.78 | 0.68 | % | $ | 3.21 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.48 | 0.68 | % | $ | 3.42 | |||||||||||
PowerShares Dynamic Small Cap Value Portfolio Actual | $ | 1,000.00 | $ | 893.76 | 0.63 | % | $ | 2.97 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
Beginning Account Value April 3, 2008 (Fund Inception) | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Number of Days in the Period | Expenses Paid During Period (2) April 3, 2008 (Fund Inception) to April 30, 2008 | ||||||||||||||||
PowerShares FTSE NASDAQ Small Cap Portfolio Actual | $ | 1,000.00 | $ | 994.96 | 0.70 | % | $ | 0.52 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.38 | 0.70 | % | $ | 3.52 | |||||||||||
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Zacks Micro Cap Portfolio Actual | $ | 1,000.00 | $ | 793.46 | 0.70 | % | $ | 3.12 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.38 | 0.70 | % | $ | 3.52 | |||||||||||
PowerShares Zacks Small Cap Portfolio Actual | $ | 1,000.00 | $ | 818.58 | 0.70 | % | $ | 3.17 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.38 | 0.70 | % | $ | 3.52 |
(1) Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six months ended April 30, 2008. Expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 182 and then dividing the result by 366. Expense ratios for the most recent half-year may differ from expense ratios based on the one year data in the financial highlights.
(2) Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the period ended April 30, 2008. Expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 28 and then dividing the result by 366. Hypothetical expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 182 and then dividing the result by 366.
37
Schedule of Investments
PowerShares Dynamic Aggressive Growth Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Consumer Discretionary—17.2% | |||||||||||
1,843 | Amazon.com, Inc.* | $ | 144,915 | ||||||||
1,936 | Apollo Group, Inc., Class A* | 98,542 | |||||||||
2,835 | Arbitron, Inc. | 135,626 | |||||||||
4,631 | Burger King Holdings, Inc. | 129,205 | |||||||||
14,947 | Corinthian Colleges, Inc.* | 169,649 | |||||||||
2,704 | DeVry, Inc. | 154,128 | |||||||||
3,693 | Fossil, Inc.* | 132,172 | |||||||||
2,805 | GameStop Corp., Class A* | 154,387 | |||||||||
2,024 | Garmin Ltd. | 82,782 | |||||||||
4,385 | Goodyear Tire & Rubber (The) Co.* | 117,430 | |||||||||
4,725 | Marvel Entertainment, Inc.* | 135,560 | |||||||||
1,823 | Morningstar, Inc.* | 105,698 | |||||||||
3,763 | NetFlix, Inc.* | 120,341 | |||||||||
1,042 | priceline.com, Inc.* | 133,001 | |||||||||
763 | Strayer Education, Inc. | 141,681 | |||||||||
4,129 | Urban Outfitters, Inc.* | 141,418 | |||||||||
3,129 | WMS Industries, Inc.* | 113,239 | |||||||||
2,209,774 | |||||||||||
Energy—6.4% | |||||||||||
2,797 | Cameron International Corp.* | 137,696 | |||||||||
3,726 | Denbury Resources, Inc.* | 113,867 | |||||||||
3,488 | Dresser-Rand Group, Inc.* | 127,556 | |||||||||
2,097 | FMC Technologies, Inc.* | 140,918 | |||||||||
3,106 | Massey Energy Co. | 162,537 | |||||||||
1,374 | Schlumberger Ltd. | 138,156 | |||||||||
820,730 | |||||||||||
Financials—3.3% | |||||||||||
6,060 | Charles Schwab (The) Corp. | 130,896 | |||||||||
6,208 | GFI Group, Inc. | 72,944 | |||||||||
2,863 | Nasdaq OMX (The) Group, Inc.* | 104,356 | |||||||||
5,131 | optionsXpress Holdings, Inc. | 110,163 | |||||||||
418,359 | |||||||||||
Health Care—24.4% | |||||||||||
2,890 | Air Methods Corp.* | 115,889 | |||||||||
2,006 | Allergan, Inc. | 113,078 | |||||||||
2,778 | Amedisys, Inc.* | 143,900 | |||||||||
2,031 | Analogic Corp. | 116,965 | |||||||||
1,254 | C.R. Bard, Inc. | 118,089 | |||||||||
1,610 | Dionex Corp.* | 125,934 | |||||||||
9,935 | eResearch Technology, Inc.* | 121,008 | |||||||||
2,011 | Express Scripts, Inc.* | 140,810 | |||||||||
2,485 | Gen-Probe, Inc.* | 140,055 | |||||||||
1,676 | Genzyme Corp.* | 117,907 | |||||||||
2,045 | Haemonetics Corp.* | 117,035 | |||||||||
1,986 | Henry Schein, Inc.* | 109,965 | |||||||||
11,991 | Incyte Corp.* | 130,102 | |||||||||
421 | Intuitive Surgical, Inc.* | 121,778 | |||||||||
4,146 | Martek Biosciences Corp.* | 146,189 | |||||||||
5,794 | Medicis Pharmaceutical Corp., Class A | 119,356 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
3,467 | Meridian Bioscience, Inc. | $ | 93,366 | ||||||||
8,494 | Millennium Pharmaceuticals, Inc.* | 211,247 | |||||||||
3,305 | OSI Pharmaceuticals, Inc.* | 114,518 | |||||||||
3,556 | Perrigo Co. | 145,761 | |||||||||
4,122 | PharmaNet Development Group, Inc.* | 98,351 | |||||||||
1,825 | Stryker Corp. | 118,315 | |||||||||
2,266 | Varian Medical Systems, Inc.* | 106,230 | |||||||||
7,044 | Warner Chilcott Ltd., Class A* | 121,227 | |||||||||
1,993 | Waters Corp.* | 122,490 | |||||||||
3,129,565 | |||||||||||
Industrials—18.6% | |||||||||||
2,138 | Advisory Board (The) Co.* | 99,674 | |||||||||
1,832 | AGCO Corp.* | 110,158 | |||||||||
3,464 | BE Aerospace, Inc.* | 139,807 | |||||||||
2,341 | C.H. Robinson Worldwide, Inc. | 146,734 | |||||||||
13,351 | CBIZ, Inc.* | 118,423 | |||||||||
2,852 | Copart, Inc.* | 116,561 | |||||||||
2,085 | Dynamic Materials Corp. | 98,058 | |||||||||
1,091 | Flowserve Corp. | 135,382 | |||||||||
853 | Fluor Corp. | 130,398 | |||||||||
5,885 | Hexcel Corp.* | 131,706 | |||||||||
3,629 | II-VI, Inc.* | 134,781 | |||||||||
1,480 | Jacobs Engineering Group, Inc.* | 127,768 | |||||||||
2,636 | Kirby Corp.* | 144,558 | |||||||||
2,917 | Manitowoc (The) Co., Inc. | 110,321 | |||||||||
2,275 | McDermott International, Inc.* | 121,895 | |||||||||
5,489 | Orbital Sciences Corp.* | 147,709 | |||||||||
1,076 | Precision Castparts Corp. | 126,495 | |||||||||
2,107 | Roper Industries, Inc. | 130,887 | |||||||||
2,205 | Stericycle, Inc.* | 117,703 | |||||||||
2,389,018 | |||||||||||
Information Technology—29.1% | |||||||||||
4,361 | Activision, Inc.* | 117,965 | |||||||||
3,214 | Amphenol Corp., Class A | 148,423 | |||||||||
4,886 | Ansoft Corp.* | 162,020 | |||||||||
3,180 | Ansys, Inc.* | 127,931 | |||||||||
950 | Apple, Inc.* | 165,253 | |||||||||
3,822 | Autodesk, Inc.* | 145,236 | |||||||||
3,608 | Citrix Systems, Inc.* | 118,162 | |||||||||
3,933 | Cognizant Technology Solutions Corp., Class A* | 126,839 | |||||||||
2,685 | Dolby Laboratories, Inc., Class A* | 107,803 | |||||||||
2,257 | Factset Research Systems, Inc. | 135,488 | |||||||||
4,175 | FLIR Systems, Inc.* | 143,328 | |||||||||
3,589 | Hittite Microwave Corp.* | 142,483 | |||||||||
6,806 | Informatica Corp.* | 108,624 | |||||||||
3,950 | Iron Mountain, Inc.* | 108,507 | |||||||||
4,431 | Juniper Networks, Inc.* | 122,384 | |||||||||
2,696 | ManTech International Corp., Class A* | 128,788 | |||||||||
625 | Mastercard, Inc., Class A | 173,849 | |||||||||
1,558 | MEMC Electronic Materials, Inc.* | 98,107 | |||||||||
3,709 | MICROS Systems, Inc.* | 132,226 |
See Notes to Financial Statements.
38
Schedule of Investments (Continued)
PowerShares Dynamic Aggressive Growth Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
4,595 | National Instruments Corp. | $ | 135,185 | ||||||||
5,496 | NetApp, Inc.* | 133,003 | |||||||||
4,631 | NeuStar, Inc., Class A* | 127,399 | |||||||||
4,518 | Power Integrations, Inc.* | 140,826 | |||||||||
3,647 | Quality Systems, Inc. | 117,142 | |||||||||
2,636 | Sohu.com, Inc.* | 182,226 | |||||||||
14,265 | SonicWALL, Inc.* | 109,698 | |||||||||
3,125 | SPSS, Inc.* | 132,000 | |||||||||
4,364 | Syntel, Inc. | 144,492 | |||||||||
3,735,387 | |||||||||||
Materials—1.0% | |||||||||||
1,068 | Mosaic (The) Co.* | 130,841 | |||||||||
Total Investments (Cost $12,311,897)—100.0% | 12,833,674 | ||||||||||
Liabilities in excess of other assets—(0.0%) | (2,890 | ) | |||||||||
Net Assets—100.0% | $ | 12,830,784 |
* Non-income producing security.
See Notes to Financial Statements.
39
Schedule of Investments
PowerShares Dynamic Deep Value Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Consumer Discretionary—9.5% | |||||||||||
1,386 | Autoliv, Inc. | $ | 84,879 | ||||||||
1,005 | Black & Decker (The) Corp. | 65,958 | |||||||||
3,030 | CBS Corp., Class B | 69,902 | |||||||||
1,655 | E.W. Scripps Co., Class A | 74,326 | |||||||||
2,474 | Jakks Pacific, Inc.* | 58,114 | |||||||||
1,595 | Meredith Corp. | 51,694 | |||||||||
3,962 | RadioShack Corp. | 55,072 | |||||||||
4,032 | Rent-A-Center, Inc.* | 86,808 | |||||||||
1,424 | Stanley Works (The) | 68,694 | |||||||||
819 | Whirlpool Corp. | 59,607 | |||||||||
675,054 | |||||||||||
Consumer Staples—5.7% | |||||||||||
3,065 | Altria Group, Inc. | 61,300 | |||||||||
2,141 | Campbell Soup Co. | 74,507 | |||||||||
1,061 | Kimberly-Clark Corp. | 67,893 | |||||||||
2,033 | Pepsi Bottling Group (The), Inc. | 68,532 | |||||||||
1,085 | Reynolds American, Inc. | 58,427 | |||||||||
2,406 | Safeway, Inc. | 76,030 | |||||||||
406,689 | |||||||||||
Energy—10.8% | |||||||||||
1,085 | Anadarko Petroleum Corp. | 72,218 | |||||||||
603 | Apache Corp. | 81,212 | |||||||||
798 | Chevron Corp. | 76,728 | |||||||||
836 | ConocoPhillips | 72,021 | |||||||||
795 | Exxon Mobil Corp. | 73,991 | |||||||||
1,542 | Helmerich & Payne, Inc. | 82,883 | |||||||||
1,210 | Lufkin Industries, Inc. | 91,294 | |||||||||
893 | Noble Energy, Inc. | 77,691 | |||||||||
720 | SEACOR Holdings, Inc.* | 61,279 | |||||||||
1,362 | Stone Energy Corp.* | 83,000 | |||||||||
772,317 | |||||||||||
Financials—40.1% | |||||||||||
1,229 | ACE Ltd. | 74,096 | |||||||||
1,449 | Allstate (The) Corp. | 72,972 | |||||||||
2,673 | American Financial Group, Inc. | 73,294 | |||||||||
1,365 | Ameriprise Financial, Inc. | 64,824 | |||||||||
1,662 | Aon Corp. | 75,438 | |||||||||
1,010 | Arch Capital Group Ltd.* | 71,357 | |||||||||
1,105 | Assurant, Inc. | 71,825 | |||||||||
1,641 | BancFirst Corp. | 71,761 | |||||||||
1,440 | Bank of Hawaii Corp. | 78,955 | |||||||||
1,358 | Chubb (The) Corp. | 71,933 | |||||||||
1,860 | Cincinnati Financial Corp. | 66,774 | |||||||||
1,857 | City Holding Co. | 77,214 | |||||||||
4,900 | CNA Surety Corp.* | 64,827 | |||||||||
1,660 | Commerce Bancshares, Inc. | 72,210 | |||||||||
3,129 | Community Bank System, Inc. | 79,758 | |||||||||
2,293 | Delphi Financial Group, Inc., Class A | 62,415 | |||||||||
714 | Everest Re Group Ltd. | 64,510 | |||||||||
2,059 | Harleysville Group, Inc. | 75,051 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
2,874 | HCC Insurance Holdings, Inc. | $ | 70,930 | ||||||||
3,978 | Horace Mann Educators Corp. | 67,308 | |||||||||
2,549 | IPC Holdings Ltd. | 74,201 | |||||||||
4,313 | Knight Capital Group, Inc., Class A* | 80,696 | |||||||||
1,653 | Loews Corp. | 69,608 | |||||||||
1,516 | Mercury General Corp. | 75,633 | |||||||||
1,187 | MetLife, Inc. | 72,229 | |||||||||
899 | PartnerRe Ltd. | 66,508 | |||||||||
948 | Prudential Financial, Inc. | 71,773 | |||||||||
1,264 | Reinsurance Group of America, Inc. | 65,703 | |||||||||
1,324 | RLI Corp. | 63,552 | |||||||||
1,495 | Safeco Corp. | 99,777 | |||||||||
1,864 | Safety Insurance Group, Inc. | 66,918 | |||||||||
2,910 | Selective Insurance Group | 62,041 | |||||||||
1,408 | StanCorp Financial Group, Inc. | 72,146 | |||||||||
1,147 | Torchmark Corp. | 74,257 | |||||||||
1,490 | Travelers (The) Cos., Inc. | 75,096 | |||||||||
3,686 | United America Indemnity Ltd., Class A* | 56,986 | |||||||||
2,013 | United Fire & Casualty Co. | 66,328 | |||||||||
2,402 | W.R. Berkley Corp. | 61,707 | |||||||||
1,461 | Westamerica Bancorp | 85,381 | |||||||||
2,105 | Willis Group Holdings Ltd. | 73,149 | |||||||||
2,861,141 | |||||||||||
Health Care—0.9% | |||||||||||
3,103 | Pfizer, Inc. | 62,401 | |||||||||
Industrials—7.9% | |||||||||||
2,402 | Cintas Corp. | 71,123 | |||||||||
858 | Eaton Corp. | 75,367 | |||||||||
2,407 | Mueller Industries, Inc. | 77,915 | |||||||||
3,537 | Republic Airways Holdings, Inc.* | 59,634 | |||||||||
4,665 | Rush Enterprises, Inc., Class A* | 75,200 | |||||||||
1,200 | Ryder System, Inc. | 82,163 | |||||||||
3,126 | Skywest, Inc. | 59,488 | |||||||||
3,440 | United Rentals, Inc.* | 64,810 | |||||||||
565,700 | |||||||||||
Information Technology—12.1% | |||||||||||
1,362 | Affiliated Computer Services, Inc., Class A* | 72,145 | |||||||||
5,905 | Amkor Technology, Inc.* | 56,393 | |||||||||
2,120 | Arrow Electronics, Inc.* | 57,685 | |||||||||
6,511 | Cadence Design Systems, Inc.* | 72,467 | |||||||||
1,591 | Computer Sciences Corp.* | 69,352 | |||||||||
4,788 | Convergys Corp.* | 75,267 | |||||||||
9,563 | EarthLink, Inc.* | 87,310 | |||||||||
2,093 | Lexmark International, Inc., Class A* | 65,699 | |||||||||
3,666 | Plantronics, Inc. | 91,321 | |||||||||
2,979 | Synopsys, Inc.* | 68,845 | |||||||||
5,767 | Teradyne, Inc.* | 76,643 | |||||||||
4,704 | Xerox Corp. | 65,715 | |||||||||
858,842 |
See Notes to Financial Statements.
40
Schedule of Investments (Continued)
PowerShares Dynamic Deep Value Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Telecommunication Services—3.8% | |||||||||||
1,911 | CenturyTel, Inc. | $ | 62,012 | ||||||||
1,649 | Embarq Corp. | 68,549 | |||||||||
1,904 | Verizon Communications, Inc. | 73,266 | |||||||||
5,879 | Windstream Corp. | 69,019 | |||||||||
272,846 | |||||||||||
Utilities—9.2% | |||||||||||
1,994 | AGL Resources, Inc. | 67,796 | |||||||||
1,731 | Dominion Resources, Inc. | 75,108 | |||||||||
3,942 | Duke Energy Corp. | 72,178 | |||||||||
1,400 | Edison International | 73,038 | |||||||||
1,152 | Energen Corp. | 78,612 | |||||||||
1,470 | National Fuel Gas Co. | 75,235 | |||||||||
2,238 | NSTAR | 72,086 | |||||||||
1,836 | PG&E Corp. | 73,440 | |||||||||
2,700 | UGI Corp. | 70,200 | |||||||||
657,693 | |||||||||||
Total Common Stocks (Cost $7,240,740) | 7,132,683 | ||||||||||
Money Market Fund—1.9% | |||||||||||
132,844 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $132,844) | 132,844 | |||||||||
Total Investments (Cost $7,373,584)—101.9% | 7,265,527 | ||||||||||
Liabilities in excess of other assets—(1.9%) | (132,136 | ) | |||||||||
Net Assets—100.0% | $ | 7,133,391 |
* Non-income producing security.
See Notes to Financial Statements.
41
Schedule of Investments
PowerShares Dynamic Large Cap Growth Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.9% | |||||||||||
Consumer Discretionary—9.4% | |||||||||||
147,152 | Apollo Group, Inc., Class A* | $ | 7,490,037 | ||||||||
360,572 | DIRECTV Group (The), Inc.* | 8,884,494 | |||||||||
200,050 | International Game Technology | 6,949,737 | |||||||||
1,140,417 | News Corp., Class A | 20,413,464 | |||||||||
150,040 | NIKE, Inc., Class B | 10,022,672 | |||||||||
226,790 | Viacom, Inc., Class B* | 8,717,808 | |||||||||
62,478,212 | |||||||||||
Consumer Staples—6.2% | |||||||||||
118,705 | Colgate-Palmolive Co. | 8,392,444 | |||||||||
318,458 | Procter & Gamble (The) Co. | 21,352,608 | |||||||||
150,891 | Wm. Wrigley Jr. Co. | 11,491,859 | |||||||||
41,236,911 | |||||||||||
Energy—3.7% | |||||||||||
243,785 | Schlumberger Ltd. | 24,512,582 | |||||||||
Financials—4.5% | |||||||||||
460,595 | Charles Schwab (The) Corp. | 9,948,852 | |||||||||
133,553 | Northern Trust Corp. | 9,897,613 | |||||||||
178,749 | T. Rowe Price Group, Inc. | 10,467,541 | |||||||||
30,314,006 | |||||||||||
Health Care—18.4% | |||||||||||
393,563 | Abbott Laboratories | 20,760,448 | |||||||||
153,036 | Baxter International, Inc. | 9,537,204 | |||||||||
99,894 | Becton, Dickinson & Co. | 8,930,524 | |||||||||
152,832 | Express Scripts, Inc.* | 10,701,297 | |||||||||
278,220 | Genentech, Inc.* | 18,974,604 | |||||||||
132,189 | Humana, Inc.* | 6,317,312 | |||||||||
153,718 | McKesson Corp. | 8,011,782 | |||||||||
426,971 | Medtronic, Inc. | 20,784,948 | |||||||||
138,726 | Stryker Corp. | 8,993,607 | |||||||||
161,491 | Thermo Fisher Scientific, Inc.* | 9,345,484 | |||||||||
122,357,210 | |||||||||||
Industrials—7.1% | |||||||||||
177,242 | Emerson Electric Co. | 9,262,667 | |||||||||
84,977 | L-3 Communications Holdings, Inc. | 9,470,687 | |||||||||
81,820 | Precision Castparts Corp. | 9,618,759 | |||||||||
139,301 | Raytheon Co. | 8,911,085 | |||||||||
166,739 | Textron, Inc. | 10,172,746 | |||||||||
47,435,944 | |||||||||||
Information Technology—38.9% | |||||||||||
268,419 | Adobe Systems, Inc.* | 10,009,345 | |||||||||
168,577 | Apple, Inc.* | 29,323,969 | |||||||||
864,807 | Cisco Systems, Inc.* | 22,173,651 | |||||||||
388,818 | Corning, Inc. | 10,385,329 | |||||||||
342,653 | eBay, Inc.* | 10,721,612 | |||||||||
44,730 | Google, Inc., Class A* | 25,687,992 | |||||||||
1,056,408 | Intel Corp. | 23,515,642 | |||||||||
47,537 | Mastercard, Inc., Class A | 13,222,892 | |||||||||
118,848 | MEMC Electronic Materials, Inc.* | 7,483,859 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
774,255 | Microsoft Corp. | $ | 22,081,753 | ||||||||
422,266 | NVIDIA Corp.* | 8,677,566 | |||||||||
1,125,379 | Oracle Corp.* | 23,464,152 | |||||||||
497,410 | QUALCOMM, Inc. | 21,483,138 | |||||||||
703,452 | Texas Instruments, Inc. | 20,512,660 | |||||||||
434,244 | Western Union (The) Co. | 9,987,612 | |||||||||
258,731,172 | |||||||||||
Materials—7.6% | |||||||||||
98,893 | Air Products & Chemicals, Inc. | 9,734,038 | |||||||||
182,184 | Monsanto Co. | 20,772,619 | |||||||||
81,152 | Mosaic (The) Co.* | 9,941,932 | |||||||||
112,510 | Praxair, Inc. | 10,273,288 | |||||||||
50,721,877 | |||||||||||
Utilities—4.1% | |||||||||||
102,235 | Constellation Energy Group, Inc. | 8,654,193 | |||||||||
199,041 | PPL Corp. | 9,557,948 | |||||||||
204,812 | Public Service Enterprise Group, Inc. | 8,993,295 | |||||||||
27,205,436 | |||||||||||
Total Common Stocks (Cost $671,233,698) | 664,993,350 | ||||||||||
Money Market Fund—0.1% | |||||||||||
601,057 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $601,057) | 601,057 | |||||||||
Total Investments (Cost $671,834,755)—100.0% | 665,594,407 | ||||||||||
Other assets less liabilities—0.0% | 14,344 | ||||||||||
Net Assets—100.0% | $ | 665,608,751 |
See Notes to Financial Statements.
42
Schedule of Investments
PowerShares Dynamic Large Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.8% | |||||||||||
Consumer Discretionary—10.5% | |||||||||||
2,935 | Apollo Group, Inc., Class A* | $ | 149,392 | ||||||||
4,189 | Best Buy Co., Inc. | 180,211 | |||||||||
7,192 | DIRECTV Group (The), Inc.* | 177,211 | |||||||||
8,932 | Gap (The), Inc. | 166,314 | |||||||||
7,769 | McDonald's Corp. | 462,876 | |||||||||
22,835 | News Corp., Class A | 408,747 | |||||||||
4,033 | Omnicom Group, Inc. | 192,535 | |||||||||
5,630 | TJX Cos., Inc. | 181,399 | |||||||||
4,533 | Viacom, Inc., Class B* | 174,249 | |||||||||
12,972 | Walt Disney (The) Co. | 420,681 | |||||||||
5,229 | Yum! Brands, Inc. | 212,716 | |||||||||
2,726,331 | |||||||||||
Consumer Staples—9.0% | |||||||||||
18,652 | Altria Group, Inc. | 373,040 | |||||||||
2,368 | Colgate-Palmolive Co. | 167,418 | |||||||||
3,218 | General Mills, Inc. | 194,367 | |||||||||
2,764 | Kimberly-Clark Corp. | 176,868 | |||||||||
6,044 | PepsiCo, Inc. | 414,195 | |||||||||
6,353 | Procter & Gamble (The) Co. | 425,969 | |||||||||
2,827 | Reynolds American, Inc. | 152,234 | |||||||||
6,269 | Safeway, Inc. | 198,100 | |||||||||
3,010 | Wm. Wrigley Jr. Co. | 229,242 | |||||||||
2,331,433 | |||||||||||
Energy—11.2% | |||||||||||
2,826 | Anadarko Petroleum Corp. | 188,099 | |||||||||
1,571 | Apache Corp. | 211,582 | |||||||||
4,851 | Chevron Corp. | 466,424 | |||||||||
5,083 | ConocoPhillips | 437,900 | |||||||||
4,832 | Exxon Mobil Corp. | 449,714 | |||||||||
1,934 | Hess Corp. | 205,391 | |||||||||
5,434 | Occidental Petroleum Corp. | 452,163 | |||||||||
4,863 | Schlumberger Ltd. | 488,975 | |||||||||
2,900,248 | |||||||||||
Financials—11.6% | |||||||||||
3,204 | ACE Ltd. | 193,169 | |||||||||
2,886 | AFLAC, Inc. | 192,410 | |||||||||
3,775 | Allstate (The) Corp. | 190,109 | |||||||||
9,939 | American Express Co. | 477,270 | |||||||||
3,557 | Ameriprise Financial, Inc. | 168,922 | |||||||||
4,107 | Bank of New York Mellon (The) Corp. | 178,778 | |||||||||
9,188 | Charles Schwab (The) Corp. | 198,461 | |||||||||
3,540 | Chubb (The) Corp. | 187,514 | |||||||||
7,758 | Liberty Media Corp.-Capital, Series A* | 119,240 | |||||||||
4,306 | Loews Corp. | 181,326 | |||||||||
3,093 | MetLife, Inc. | 188,209 | |||||||||
2,664 | Northern Trust Corp. | 197,429 | |||||||||
2,469 | Prudential Financial, Inc. | 186,928 | |||||||||
2,294 | State Street Corp. | 165,489 | |||||||||
3,882 | Travelers (The) Cos., Inc. | 195,653 | |||||||||
3,020,907 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Health Care—15.4% | |||||||||||
7,850 | Abbott Laboratories | $ | 414,087 | ||||||||
3,633 | Aetna, Inc. | 158,399 | |||||||||
3,053 | Baxter International, Inc. | 190,263 | |||||||||
1,993 | Becton, Dickinson & Co. | 178,174 | |||||||||
4,042 | CIGNA Corp. | 172,634 | |||||||||
8,405 | Eli Lilly & Co. | 404,617 | |||||||||
3,049 | Express Scripts, Inc.* | 213,491 | |||||||||
2,636 | Humana, Inc.* | 125,974 | |||||||||
6,785 | Johnson & Johnson | 455,205 | |||||||||
3,066 | McKesson Corp. | 159,800 | |||||||||
9,490 | Merck & Co., Inc. | 361,000 | |||||||||
18,869 | Pfizer, Inc. | 379,456 | |||||||||
2,767 | Stryker Corp. | 179,385 | |||||||||
3,222 | Thermo Fisher Scientific, Inc.* | 186,457 | |||||||||
9,045 | UnitedHealth Group, Inc. | 295,138 | |||||||||
2,571 | WellPoint, Inc.* | 127,907 | |||||||||
4,001,987 | |||||||||||
Industrials—12.9% | |||||||||||
5,362 | 3M Co. | 412,338 | |||||||||
5,078 | Boeing Co. | 430,919 | |||||||||
2,114 | Deere & Co. | 177,724 | |||||||||
3,535 | Emerson Electric Co. | 184,739 | |||||||||
2,201 | General Dynamics Corp. | 199,014 | |||||||||
3,131 | Honeywell International, Inc. | 185,981 | |||||||||
1,695 | L-3 Communications Holdings, Inc. | 188,908 | |||||||||
1,745 | Lockheed Martin Corp. | 185,040 | |||||||||
3,406 | Norfolk Southern Corp. | 202,929 | |||||||||
2,292 | Northrop Grumman Corp. | 168,622 | |||||||||
1,632 | Precision Castparts Corp. | 191,858 | |||||||||
2,779 | Raytheon Co. | 177,773 | |||||||||
3,326 | Textron, Inc. | 202,919 | |||||||||
5,963 | United Technologies Corp. | 432,140 | |||||||||
3,340,904 | |||||||||||
Information Technology—19.7% | |||||||||||
5,354 | Adobe Systems, Inc.* | 199,651 | |||||||||
3,363 | Apple, Inc.* | 584,993 | |||||||||
9,399 | Applied Materials, Inc. | 175,385 | |||||||||
17,250 | Cisco Systems, Inc.* | 442,290 | |||||||||
7,756 | Corning, Inc. | 207,163 | |||||||||
6,835 | eBay, Inc.* | 213,867 | |||||||||
8,800 | Hewlett-Packard Co. | 407,880 | |||||||||
21,073 | Intel Corp. | 469,085 | |||||||||
3,692 | International Business Machines Corp. | 445,624 | |||||||||
2,362 | MEMC Electronic Materials, Inc.* | 148,735 | |||||||||
15,445 | Microsoft Corp. | 440,491 | |||||||||
8,423 | NVIDIA Corp.* | 173,093 | |||||||||
22,362 | Oracle Corp.* | 466,248 | |||||||||
10,699 | Symantec Corp.* | 184,237 | |||||||||
6,014 | Texas Instruments, Inc. | 175,368 |
See Notes to Financial Statements.
43
Schedule of Investments (Continued)
PowerShares Dynamic Large Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
8,662 | Western Union (The) Co. | $ | 199,226 | ||||||||
12,256 | Xerox Corp. | 171,216 | |||||||||
5,104,552 | |||||||||||
Materials—0.8% | |||||||||||
1,619 | Mosaic (The) Co.* | 198,344 | |||||||||
Telecommunication Services—3.5% | |||||||||||
12,070 | AT&T, Inc. | 467,230 | |||||||||
11,581 | Verizon Communications, Inc. | 445,637 | |||||||||
912,867 | |||||||||||
Utilities—5.2% | |||||||||||
4,511 | Dominion Resources, Inc. | 195,732 | |||||||||
10,272 | Duke Energy Corp. | 188,080 | |||||||||
3,647 | Edison International | 190,264 | |||||||||
2,665 | FirstEnergy Corp. | 201,582 | |||||||||
4,784 | PG&E Corp. | 191,360 | |||||||||
3,971 | PPL Corp. | 190,687 | |||||||||
4,085 | Public Service Enterprise Group, Inc. | 179,372 | |||||||||
1,337,077 | |||||||||||
Total Common Stocks (Cost $26,124,823) | 25,874,650 | ||||||||||
Money Market Fund—0.6% | |||||||||||
156,936 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $156,936) | 156,936 | |||||||||
Total Investments (Cost $26,281,759)—100.4% | 26,031,586 | ||||||||||
Liabilities in excess of other assets—(0.4%) | (109,292 | ) | |||||||||
Net Assets—100.0% | $ | 25,922,294 |
* Non-income producing security.
See Notes to Financial Statements.
44
Schedule of Investments
PowerShares Dynamic Large Cap Value Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.8% | |||||||||||
Consumer Discretionary—6.3% | |||||||||||
152,344 | CBS Corp., Class B | $ | 3,514,576 | ||||||||
149,912 | McDonald's Corp. | 8,931,757 | |||||||||
107,266 | Walt Disney (The) Co. | 3,478,636 | |||||||||
15,924,969 | |||||||||||
Consumer Staples—9.8% | |||||||||||
359,608 | Altria Group, Inc. | 7,192,160 | |||||||||
73,826 | Anheuser-Busch Cos., Inc. | 3,632,239 | |||||||||
62,093 | General Mills, Inc. | 3,750,417 | |||||||||
53,337 | Kimberly-Clark Corp. | 3,413,035 | |||||||||
54,559 | Reynolds American, Inc. | 2,938,002 | |||||||||
120,965 | Safeway, Inc. | 3,822,494 | |||||||||
24,748,347 | |||||||||||
Energy—17.5% | |||||||||||
54,542 | Anadarko Petroleum Corp. | 3,630,316 | |||||||||
30,307 | Apache Corp. | 4,081,747 | |||||||||
93,604 | Chevron Corp. | 9,000,025 | |||||||||
98,074 | ConocoPhillips | 8,449,075 | |||||||||
33,843 | Devon Energy Corp. | 3,837,796 | |||||||||
93,228 | Exxon Mobil Corp. | 8,676,730 | |||||||||
44,935 | Occidental Petroleum Corp. | 3,739,041 | |||||||||
60,178 | Valero Energy Corp. | 2,939,695 | |||||||||
44,354,425 | |||||||||||
Financials—32.7% | |||||||||||
61,814 | ACE Ltd. | 3,726,766 | |||||||||
72,838 | Allstate (The) Corp. | 3,668,122 | |||||||||
82,187 | American Express Co. | 3,946,620 | |||||||||
173,107 | American International Group, Inc. | 7,997,543 | |||||||||
68,652 | Ameriprise Financial, Inc. | 3,260,283 | |||||||||
204,122 | Bank of America Corp. | 7,662,740 | |||||||||
68,301 | Chubb (The) Corp. | 3,617,904 | |||||||||
47,822 | Goldman Sachs Group (The), Inc. | 9,151,696 | |||||||||
49,734 | Hartford Financial Services Group (The), Inc. | 3,544,542 | |||||||||
199,552 | JPMorgan Chase & Co. | 9,508,653 | |||||||||
68,021 | Lincoln National Corp. | 3,656,809 | |||||||||
83,091 | Loews Corp. | 3,498,962 | |||||||||
59,672 | MetLife, Inc. | 3,631,041 | |||||||||
47,642 | Prudential Financial, Inc. | 3,606,976 | |||||||||
74,908 | Travelers (The) Cos., Inc. | 3,775,363 | |||||||||
277,517 | Wells Fargo & Co. | 8,256,131 | |||||||||
82,510,151 | |||||||||||
Health Care—10.0% | |||||||||||
77,980 | CIGNA Corp. | 3,330,526 | |||||||||
69,501 | Eli Lilly & Co. | 3,345,778 | |||||||||
130,922 | Johnson & Johnson | 8,783,557 | |||||||||
364,085 | Pfizer, Inc. | 7,321,749 | |||||||||
49,606 | WellPoint, Inc.* | 2,467,899 | |||||||||
25,249,509 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Industrials—4.6% | |||||||||||
65,730 | Norfolk Southern Corp. | $ | 3,916,194 | ||||||||
80,140 | PACCAR, Inc. | 3,792,225 | |||||||||
105,894 | Waste Management, Inc. | 3,822,773 | |||||||||
11,531,192 | |||||||||||
Information Technology—6.1% | |||||||||||
71,242 | International Business Machines Corp. | 8,598,909 | |||||||||
206,444 | Symantec Corp.* | 3,554,966 | |||||||||
236,496 | Xerox Corp. | 3,303,849 | |||||||||
15,457,724 | |||||||||||
Telecommunication Services—7.0% | |||||||||||
232,898 | AT&T, Inc. | 9,015,481 | |||||||||
224,393 | Verizon Communications, Inc. | 8,634,643 | |||||||||
17,650,124 | |||||||||||
Utilities—5.8% | |||||||||||
87,044 | Dominion Resources, Inc. | 3,776,839 | |||||||||
198,204 | Duke Energy Corp. | 3,629,115 | |||||||||
70,375 | Edison International | 3,671,464 | |||||||||
92,312 | PG&E Corp. | 3,692,480 | |||||||||
14,769,898 | |||||||||||
Total Common Stocks (Cost $260,303,097) | 252,196,339 | ||||||||||
Money Market Fund—0.1% | |||||||||||
129,076 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $129,076) | 129,076 | |||||||||
Total Investments (Cost $260,432,173)—99.9% | 252,325,415 | ||||||||||
Other assets less liabilities—0.1% | 163,775 | ||||||||||
Net Assets—100.0% | $ | 252,489,190 |
* Non-income producing security.
See Notes to Financial Statements.
45
Schedule of Investments
PowerShares Dynamic Mid Cap Growth Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.9% | |||||||||||
Consumer Discretionary—10.6% | |||||||||||
75,745 | Aeropostale, Inc.* | $ | 2,407,934 | ||||||||
79,286 | Burger King Holdings, Inc. | 2,212,079 | |||||||||
385,702 | DISH Network Corp., Class A* | 11,509,348 | |||||||||
63,221 | Fossil, Inc.* | 2,262,680 | |||||||||
269,971 | GameStop Corp., Class A* | 14,859,203 | |||||||||
429,211 | Gemstar-TV Guide International, Inc.* | 1,729,720 | |||||||||
31,210 | Morningstar, Inc.* | 1,809,556 | |||||||||
17,843 | priceline.com, Inc.* | 2,277,481 | |||||||||
13,065 | Strayer Education, Inc. | 2,426,040 | |||||||||
41,494,041 | |||||||||||
Consumer Staples—1.0% | |||||||||||
75,914 | Alberto-Culver Co. | 1,910,755 | |||||||||
38,053 | Church & Dwight Co., Inc. | 2,162,172 | |||||||||
4,072,927 | |||||||||||
Energy—12.2% | |||||||||||
269,214 | Cameron International Corp.* | 13,253,405 | |||||||||
59,717 | Dresser-Rand Group, Inc.* | 2,183,851 | |||||||||
201,837 | FMC Technologies, Inc.* | 13,563,446 | |||||||||
53,174 | Massey Energy Co. | 2,782,595 | |||||||||
232,710 | Noble Corp. | 13,096,919 | |||||||||
33,232 | Whiting Petroleum Corp.* | 2,542,913 | |||||||||
47,423,129 | |||||||||||
Financials—5.2% | |||||||||||
5,749 | Alleghany Corp.* | 1,980,531 | |||||||||
106,308 | GFI Group, Inc. | 1,249,119 | |||||||||
43,678 | Investment Technology Group, Inc.* | 2,107,900 | |||||||||
49,014 | Nasdaq OMX (The) Group, Inc.* | 1,786,560 | |||||||||
81,347 | SEI Investments Co. | 1,892,945 | |||||||||
624,922 | TD Ameritrade Holding Corp.* | 11,311,088 | |||||||||
20,328,143 | |||||||||||
Health Care—11.2% | |||||||||||
60,353 | Applera Corp. - Applied Biosystems Group | 1,925,864 | |||||||||
120,645 | C.R. Bard, Inc. | 11,361,140 | |||||||||
292,934 | DENTSPLY International, Inc. | 11,386,346 | |||||||||
77,474 | Endo Pharmaceuticals Holdings, Inc.* | 1,923,679 | |||||||||
42,555 | Gen-Probe, Inc.* | 2,398,400 | |||||||||
34,012 | Henry Schein, Inc.* | 1,883,244 | |||||||||
56,587 | OSI Pharmaceuticals, Inc.* | 1,960,740 | |||||||||
57,796 | Patterson Cos., Inc.* | 1,976,623 | |||||||||
30,823 | Pediatrix Medical Group, Inc.* | 2,096,580 | |||||||||
60,876 | Perrigo Co. | 2,495,307 | |||||||||
29,749 | Techne Corp.* | 2,157,397 | |||||||||
34,131 | Waters Corp.* | 2,097,691 | |||||||||
43,663,011 | |||||||||||
Industrials—19.1% | |||||||||||
31,367 | AGCO Corp.* | 1,886,098 | |||||||||
59,316 | BE Aerospace, Inc.* | 2,393,994 | |||||||||
30,396 | Brink's (The) Co. | 2,211,309 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
225,254 | C.H. Robinson Worldwide, Inc. | $ | 14,118,921 | ||||||||
48,837 | Copart, Inc.* | 1,995,968 | |||||||||
70,933 | Covanta Holding Corp.* | 1,888,946 | |||||||||
48,256 | Donaldson Co., Inc. | 2,101,066 | |||||||||
82,123 | Fluor Corp. | 12,554,143 | |||||||||
142,438 | Jacobs Engineering Group, Inc.* | 12,296,673 | |||||||||
45,130 | Kirby Corp.* | 2,474,929 | |||||||||
43,866 | Landstar System, Inc. | 2,279,277 | |||||||||
49,934 | Manitowoc (The) Co., Inc. | 1,888,504 | |||||||||
218,999 | McDermott International, Inc.* | 11,733,966 | |||||||||
45,821 | Teledyne Technologies, Inc.* | 2,691,067 | |||||||||
50,508 | URS Corp.* | 2,037,493 | |||||||||
74,552,354 | |||||||||||
Information Technology—33.0% | |||||||||||
419,668 | Activision, Inc.* | 11,352,019 | |||||||||
118,902 | Altera Corp. | 2,530,235 | |||||||||
309,335 | Amphenol Corp., Class A | 14,285,090 | |||||||||
54,441 | Ansys, Inc.* | 2,190,161 | |||||||||
367,840 | Autodesk, Inc.* | 13,977,920 | |||||||||
63,028 | BMC Software, Inc.* | 2,190,853 | |||||||||
499,830 | CA, Inc. | 11,066,236 | |||||||||
347,280 | Citrix Systems, Inc.* | 11,373,420 | |||||||||
48,579 | CommScope, Inc.* | 2,309,931 | |||||||||
45,976 | Dolby Laboratories, Inc., Class A* | 1,845,936 | |||||||||
28,952 | DST Systems, Inc.* | 1,732,488 | |||||||||
38,648 | Factset Research Systems, Inc. | 2,320,039 | |||||||||
51,285 | Global Payments, Inc. | 2,269,874 | |||||||||
234,203 | Harris Corp. | 12,653,988 | |||||||||
51,559 | Hewitt Associates, Inc., Class A* | 2,113,919 | |||||||||
61,147 | McAfee, Inc.* | 2,033,138 | |||||||||
20,825 | Mettler Toledo International, Inc.* | 1,983,790 | |||||||||
63,498 | Micros Systems, Inc.* | 2,263,704 | |||||||||
528,954 | NetApp, Inc.* | 12,800,687 | |||||||||
363,506 | Paychex, Inc. | 13,220,713 | |||||||||
61,058 | Zebra Technologies Corp., Class A* | 2,243,882 | |||||||||
128,758,023 | |||||||||||
Materials—0.6% | |||||||||||
81,673 | Crown Holdings, Inc.* | 2,192,103 | |||||||||
Telecommunication Services—0.5% | |||||||||||
32,291 | United States Cellular Corp.* | 1,780,849 | |||||||||
Utilities—6.5% | |||||||||||
309,085 | Mirant Corp.* | 12,706,484 | |||||||||
501,584 | Reliant Energy, Inc.* | 12,910,773 | |||||||||
25,617,257 | |||||||||||
Total Investments (Cost $383,168,667)—99.9% | 389,881,837 | ||||||||||
Other assets less liabilities—0.1% | 264,081 | ||||||||||
Net Assets—100.0% | $ | 390,145,918 |
* Non-income producing security.
See Notes to Financial Statements.
46
Schedule of Investments
PowerShares Dynamic Mid Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Consumer Discretionary—9.5% | |||||||||||
4,936 | Abercrombie & Fitch Co., Class A | $ | 366,794 | ||||||||
2,534 | Aeropostale, Inc.* | 80,556 | |||||||||
1,364 | Autoliv, Inc. | 83,531 | |||||||||
2,653 | Burger King Holdings, Inc. | 74,019 | |||||||||
12,623 | Coach, Inc.* | 449,000 | |||||||||
12,908 | DISH Network Corp., Class A* | 385,175 | |||||||||
2,682 | DreamWorks Animation SKG, Inc., Class A* | 74,989 | |||||||||
9,163 | E.W. Scripps Co., Class A | 411,510 | |||||||||
2,115 | Fossil, Inc.* | 75,696 | |||||||||
1,571 | Meredith Corp. | 50,916 | |||||||||
126 | NVR, Inc.* | 77,301 | |||||||||
3,902 | RadioShack Corp. | 54,238 | |||||||||
1,364 | Snap-On, Inc. | 80,899 | |||||||||
438 | Strayer Education, Inc. | 81,332 | |||||||||
807 | Whirlpool Corp. | 58,733 | |||||||||
2,404,689 | |||||||||||
Consumer Staples—7.3% | |||||||||||
2,540 | Alberto-Culver Co. | 63,932 | |||||||||
2,158 | BJ's Wholesale Club, Inc.* | 82,263 | |||||||||
11,853 | Campbell Soup Co. | 412,484 | |||||||||
1,273 | Church & Dwight Co., Inc. | 72,332 | |||||||||
15,666 | Coca-Cola Enterprises, Inc. | 352,485 | |||||||||
1,667 | Hormel Foods Corp. | 65,696 | |||||||||
11,253 | Pepsi Bottling Group (The), Inc. | 379,339 | |||||||||
30,302 | Sara Lee Corp. | 439,682 | |||||||||
1,868,213 | |||||||||||
Energy—7.9% | |||||||||||
9,010 | Cameron International Corp.* | 443,562 | |||||||||
1,292 | Cimarex Energy Co. | 80,492 | |||||||||
6,395 | ENSCO International, Inc. | 407,553 | |||||||||
1,202 | FMC Technologies, Inc.* | 80,774 | |||||||||
2,455 | Mariner Energy, Inc.* | 67,660 | |||||||||
7,796 | Noble Corp. | 438,759 | |||||||||
4,944 | Noble Energy, Inc. | 430,128 | |||||||||
709 | SEACOR Holdings, Inc.* | 60,343 | |||||||||
2,009,271 | |||||||||||
Financials—11.9% | |||||||||||
2,632 | American Financial Group, Inc. | 72,169 | |||||||||
9,197 | AON Corp. | 417,452 | |||||||||
994 | Arch Capital Group Ltd.* | 70,226 | |||||||||
6,119 | Assurant, Inc. | 397,735 | |||||||||
1,418 | Bank of Hawaii Corp. | 77,749 | |||||||||
1,832 | Cincinnati Financial Corp. | 65,769 | |||||||||
1,634 | Commerce Bancshares, Inc. | 71,079 | |||||||||
1,380 | Erie Indemnity Co., Class A | 73,720 | |||||||||
702 | Everest Re Group Ltd. | 63,426 | |||||||||
1,678 | Federated Investors, Inc., Class B | 56,179 | |||||||||
3,582 | GFI Group, Inc. | 42,089 | |||||||||
1,559 | Hanover Insurance Group (The), Inc. | 69,968 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
2,830 | HCC Insurance Holdings, Inc. | $ | 69,844 | ||||||||
1,462 | Investment Technology Group, Inc.* | 70,556 | |||||||||
147 | Markel Corp.* | 63,857 | |||||||||
1,493 | Mercury General Corp. | 74,486 | |||||||||
1,640 | Nasdaq OMX (The) Group, Inc.* | 59,778 | |||||||||
1,882 | Odyssey Re Holdings Corp. | 67,338 | |||||||||
886 | PartnerRe Ltd. | 65,546 | |||||||||
2,008 | Philadelphia Consolidated Holding Co.* | 74,055 | |||||||||
1,281 | ProAssurance Corp.* | 67,803 | |||||||||
1,244 | Reinsurance Group of America, Inc. | 64,663 | |||||||||
1,472 | Safeco Corp. | 98,241 | |||||||||
2,722 | SEI Investments Co. | 63,341 | |||||||||
1,387 | StanCorp Financial Group, Inc. | 71,070 | |||||||||
20,913 | TD Ameritrade Holding Corp.* | 378,525 | |||||||||
1,130 | Torchmark Corp. | 73,156 | |||||||||
1,010 | Transatlantic Holdings, Inc. | 65,499 | |||||||||
2,364 | W.R. Berkley Corp. | 60,731 | |||||||||
2,072 | Willis Group Holdings Ltd. | 72,002 | |||||||||
3,038,052 | |||||||||||
Health Care—7.9% | |||||||||||
9,173 | AmerisourceBergen Corp. | 371,965 | |||||||||
2,020 | Applera Corp. - Applied Biosystems Group | 64,458 | |||||||||
1,009 | Beckman Coulter, Inc. | 68,915 | |||||||||
7,379 | Coventry Health Care, Inc.* | 330,063 | |||||||||
4,038 | CR Bard, Inc. | 380,258 | |||||||||
9,623 | Forest Laboratories, Inc.* | 334,014 | |||||||||
1,138 | Henry Schein, Inc.* | 63,011 | |||||||||
1,324 | Kinetic Concepts, Inc.* | 52,510 | |||||||||
1,894 | OSI Pharmaceuticals, Inc.* | 65,627 | |||||||||
1,934 | Patterson Cos., Inc.* | 66,143 | |||||||||
1,031 | Pediatrix Medical Group, Inc.* | 70,129 | |||||||||
996 | Techne Corp.* | 72,230 | |||||||||
1,427 | WellCare Health Plans, Inc.* | 62,474 | |||||||||
2,001,797 | |||||||||||
Industrials—21.5% | |||||||||||
1,050 | AGCO Corp.* | 63,137 | |||||||||
649 | Alliant Techsystems, Inc.* | 71,377 | |||||||||
1,018 | Brink's (The) Co. | 74,060 | |||||||||
7,539 | C.H. Robinson Worldwide, Inc. | 472,545 | |||||||||
9,127 | Cooper Industries Ltd., Class A | 386,894 | |||||||||
1,634 | Copart, Inc.* | 66,782 | |||||||||
7,596 | Cummins, Inc. | 475,888 | |||||||||
9,220 | Dover Corp. | 456,113 | |||||||||
4,746 | Eaton Corp. | 416,889 | |||||||||
2,749 | Fluor Corp. | 420,240 | |||||||||
6,462 | Goodrich Corp. | 440,385 | |||||||||
4,766 | Jacobs Engineering Group, Inc.* | 411,449 | |||||||||
2,043 | KBR, Inc. | 58,920 | |||||||||
1,510 | Kirby Corp.* | 82,808 | |||||||||
1,468 | Landstar System, Inc. | 76,277 | |||||||||
1,014 | Lincoln Electric Holdings, Inc. | 77,368 |
See Notes to Financial Statements.
47
Schedule of Investments (Continued)
PowerShares Dynamic Mid Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
1,201 | Manpower, Inc. | $ | 80,623 | ||||||||
7,329 | McDermott International, Inc.* | 392,688 | |||||||||
5,922 | Parker Hannifin Corp. | 472,871 | |||||||||
2,230 | Republic Services, Inc. | 70,892 | |||||||||
1,182 | Ryder System, Inc. | 80,932 | |||||||||
666 | SPX Corp. | 81,918 | |||||||||
1,533 | Teledyne Technologies, Inc.* | 90,033 | |||||||||
1,690 | URS Corp.* | 68,175 | |||||||||
1,283 | Watson Wyatt Worldwide, Inc., Class A | 75,209 | |||||||||
5,464,473 | |||||||||||
Information Technology—21.6% | |||||||||||
14,045 | Activision, Inc.* | 379,917 | |||||||||
3,979 | Altera Corp. | 84,673 | |||||||||
10,352 | Amphenol Corp., Class A | 478,056 | |||||||||
14,217 | Analog Devices, Inc. | 457,930 | |||||||||
1,822 | Ansys, Inc.* | 73,299 | |||||||||
12,309 | Autodesk, Inc.* | 467,743 | |||||||||
2,109 | BMC Software, Inc.* | 73,309 | |||||||||
16,727 | CA, Inc. | 370,336 | |||||||||
6,411 | Cadence Design Systems, Inc.* | 71,354 | |||||||||
1,625 | CommScope, Inc.* | 77,269 | |||||||||
8,808 | Computer Sciences Corp.* | 383,941 | |||||||||
4,715 | Convergys Corp.* | 74,120 | |||||||||
969 | DST Systems, Inc.* | 57,985 | |||||||||
1,717 | Global Payments, Inc. | 75,994 | |||||||||
7,837 | Harris Corp. | 423,433 | |||||||||
1,725 | Hewitt Associates, Inc., Class A* | 70,725 | |||||||||
2,061 | Lexmark International, Inc., Class A* | 64,695 | |||||||||
697 | Mettler Toledo International, Inc.* | 66,396 | |||||||||
2,124 | Micros Systems, Inc.* | 75,721 | |||||||||
4,134 | National Semiconductor Corp. | 84,292 | |||||||||
3,072 | NCR Corp.* | 75,663 | |||||||||
17,701 | NetApp, Inc.* | 428,364 | |||||||||
3,083 | Novellus Systems, Inc.* | 67,394 | |||||||||
12,165 | Paychex, Inc. | 442,441 | |||||||||
4,295 | QLogic Corp.* | 68,548 | |||||||||
3,572 | SAIC, Inc.* | 67,868 | |||||||||
2,558 | Sybase, Inc.* | 75,256 | |||||||||
2,933 | Synopsys, Inc.* | 67,782 | |||||||||
5,679 | Teradyne, Inc.* | 75,474 | |||||||||
2,205 | Western Digital Corp.* | 63,923 | |||||||||
3,044 | Xilinx, Inc. | 75,400 | |||||||||
2,043 | Zebra Technologies Corp., Class A* | 75,080 | |||||||||
5,494,381 | |||||||||||
Materials—4.6% | |||||||||||
1,294 | AK Steel Holding Corp. | 81,237 | |||||||||
1,750 | Celanese Corp., Series A | 78,313 | |||||||||
2,733 | Crown Holdings, Inc.* | 73,354 | |||||||||
1,168 | Lubrizol (The) Corp. | 68,118 | |||||||||
6,780 | Owens-Illinois, Inc.* | 373,917 | |||||||||
6,175 | PPG Industries, Inc. | 378,959 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
1,238 | Sigma-Aldrich Corp. | $ | 70,591 | ||||||||
1,506 | Terra Industries, Inc.* | 57,017 | |||||||||
1,181,506 | |||||||||||
Telecommunication Services—3.6% | |||||||||||
1,881 | CenturyTel, Inc. | 61,038 | |||||||||
9,125 | Embarq Corp. | 379,326 | |||||||||
70,873 | Qwest Communications International, Inc. | 365,705 | |||||||||
1,452 | Telephone & Data Systems, Inc. | 55,612 | |||||||||
1,081 | United States Cellular Corp.* | 59,617 | |||||||||
921,298 | |||||||||||
Utilities—4.2% | |||||||||||
1,134 | Energen Corp. | 77,384 | |||||||||
10,344 | Mirant Corp.* | 425,242 | |||||||||
1,447 | National Fuel Gas Co. | 74,057 | |||||||||
16,786 | Reliant Energy, Inc.* | 432,072 | |||||||||
2,659 | UGI Corp. | 69,134 | |||||||||
1,077,889 | |||||||||||
Total Common Stocks (Cost $25,169,018) | 25,461,569 | ||||||||||
Money Market Fund—0.4% | |||||||||||
109,031 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $109,031) | 109,031 | |||||||||
Total Investments (Cost $25,278,049)—100.4% | 25,570,600 | ||||||||||
Liabilities in excess of other assets—(0.4%) | (101,900 | ) | |||||||||
Net Assets—100.0% | $ | 25,468,700 |
* Non-income producing security.
See Notes to Financial Statements.
48
Schedule of Investments
PowerShares Dynamic Mid Cap Value Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Consumer Discretionary—17.2% | |||||||||||
8,923 | Autoliv, Inc. | $ | 546,445 | ||||||||
17,545 | DreamWorks Animation SKG, Inc., Class A* | 490,558 | |||||||||
10,660 | E.W. Scripps Co., Class A | 478,741 | |||||||||
38,520 | Fortune Brands, Inc. | 2,604,722 | |||||||||
54,168 | J. C. Penney Co., Inc. | 2,302,140 | |||||||||
129,560 | Mattel, Inc. | 2,429,250 | |||||||||
10,273 | Meredith Corp. | 332,948 | |||||||||
6,234 | Mohawk Industries, Inc.* | 474,968 | |||||||||
25,519 | RadioShack Corp. | 354,714 | |||||||||
8,919 | Snap-On, Inc. | 528,986 | |||||||||
9,173 | Stanley Works (The) | 442,506 | |||||||||
3,459 | Washington Post (The) Co., Class B | 2,267,720 | |||||||||
5,278 | Whirlpool Corp. | 384,133 | |||||||||
13,637,831 | |||||||||||
Consumer Staples—14.1% | |||||||||||
14,109 | BJ's Wholesale Club, Inc.* | 537,835 | |||||||||
77,520 | Campbell Soup Co. | 2,697,696 | |||||||||
33,247 | Carolina Group | 2,183,330 | |||||||||
10,897 | Hormel Foods Corp. | 429,451 | |||||||||
73,599 | Pepsi Bottling Group (The), Inc. | 2,481,022 | |||||||||
198,187 | Sara Lee Corp. | 2,875,694 | |||||||||
11,205,028 | |||||||||||
Energy—7.1% | |||||||||||
8,448 | Cimarex Energy Co. | 526,310 | |||||||||
32,340 | Noble Energy, Inc. | 2,813,580 | |||||||||
4,638 | SEACOR Holdings, Inc.* | 394,740 | |||||||||
40,980 | Sunoco, Inc. | 1,901,882 | |||||||||
5,636,512 | |||||||||||
Financials—21.6% | |||||||||||
17,212 | American Financial Group, Inc. | 471,953 | |||||||||
60,157 | AON Corp. | 2,730,525 | |||||||||
6,503 | Arch Capital Group Ltd.* | 459,437 | |||||||||
40,019 | Assurant, Inc. | 2,601,234 | |||||||||
9,273 | Bank of Hawaii Corp. | 508,439 | |||||||||
11,979 | Cincinnati Financial Corp. | 430,046 | |||||||||
10,692 | Commerce Bancshares, Inc. | 465,102 | |||||||||
9,022 | Erie Indemnity Co., Class A | 481,955 | |||||||||
4,595 | Everest Re Group Ltd. | 415,158 | |||||||||
10,191 | Hanover Insurance Group (The), Inc. | 457,372 | |||||||||
18,508 | HCC Insurance Holdings, Inc. | 456,777 | |||||||||
959 | Markel Corp.* | 416,590 | |||||||||
9,764 | Mercury General Corp. | 487,126 | |||||||||
5,792 | PartnerRe Ltd. | 428,492 | |||||||||
8,375 | ProAssurance Corp.* | 443,289 | |||||||||
8,139 | Reinsurance Group of America, Inc. | 423,065 | |||||||||
9,625 | SAFECO Corp. | 642,373 | |||||||||
9,070 | StanCorp Financial Group, Inc. | 464,747 | |||||||||
7,390 | Torchmark Corp. | 478,429 | |||||||||
6,608 | Transatlantic Holdings, Inc. | 428,529 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
109,257 | Unum Group | $ | 2,535,855 | ||||||||
15,466 | W.R. Berkley Corp. | 397,322 | |||||||||
13,556 | Willis Group Holdings Ltd. | 471,071 | |||||||||
17,094,886 | |||||||||||
Health Care—3.1% | |||||||||||
62,940 | Forest Laboratories, Inc.* | 2,184,648 | |||||||||
10,135 | Health Net, Inc.* | 296,854 | |||||||||
2,481,502 | |||||||||||
Industrials—12.5% | |||||||||||
18,417 | Continental Airlines, Inc., Class B* | 331,138 | |||||||||
60,301 | Dover Corp. | 2,983,090 | |||||||||
31,044 | Eaton Corp. | 2,726,905 | |||||||||
6,632 | Lincoln Electric Holdings, Inc. | 506,022 | |||||||||
78,640 | R.R. Donnelley & Sons Co. | 2,409,530 | |||||||||
14,585 | Republic Services, Inc. | 463,657 | |||||||||
7,730 | Ryder System, Inc. | 529,273 | |||||||||
9,949,615 | |||||||||||
Information Technology—7.9% | |||||||||||
57,906 | Brocade Communications Systems, Inc.* | 414,607 | |||||||||
41,930 | Cadence Design Systems, Inc.* | 466,681 | |||||||||
57,609 | Computer Sciences Corp.* | 2,511,176 | |||||||||
30,839 | Convergys Corp.* | 484,789 | |||||||||
13,482 | Lexmark International, Inc., Class A* | 423,200 | |||||||||
27,035 | National Semiconductor Corp. | 551,244 | |||||||||
28,094 | QLogic Corp.* | 448,380 | |||||||||
19,184 | Synopsys, Inc.* | 443,342 | |||||||||
37,140 | Teradyne, Inc.* | 493,591 | |||||||||
6,237,010 | |||||||||||
Materials—4.3% | |||||||||||
11,448 | Celanese Corp., Series A | 512,298 | |||||||||
7,662 | Lubrizol (The) Corp. | 446,848 | |||||||||
40,386 | PPG Industries, Inc. | 2,478,489 | |||||||||
3,437,635 | |||||||||||
Telecommunication Services—6.6% | |||||||||||
12,306 | CenturyTel, Inc. | 399,330 | |||||||||
59,684 | Embarq Corp. | 2,481,063 | |||||||||
463,536 | Qwest Communications International, Inc. | 2,391,846 | |||||||||
5,272,239 | |||||||||||
Utilities—5.6% | |||||||||||
62,877 | DTE Energy Co. | 2,534,572 | |||||||||
7,421 | Energen Corp. | 506,409 | |||||||||
9,465 | National Fuel Gas Co. | 484,419 | |||||||||
14,411 | NSTAR | 464,178 | |||||||||
17,388 | UGI Corp. | 452,088 | |||||||||
4,441,666 | |||||||||||
Total Common Stocks (Cost $84,625,281) | 79,393,924 |
See Notes to Financial Statements.
49
Schedule of Investments (Continued)
PowerShares Dynamic Mid Cap Value Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Money Market Fund—0.2% | |||||||||||
184,493 | Goldman Sachs Financial Square Prime Obiligations Institutional Share Class (Cost $184,493) | $184,493 | |||||||||
Total Investments (Cost $84,809,774)—100.2% | 79,578,417 | ||||||||||
Liabilities in excess of other assets—(0.2%) | (198,063 | ) | |||||||||
Net Assets—100.0% | $ | 79,380,354 |
* Non-income producing security.
See Notes to Financial Statements.
50
Schedule of Investments
PowerShares Dynamic Small Cap Growth Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Consumer Discretionary—10.5% | |||||||||||
5,078 | Arbitron, Inc. | $ | 242,932 | ||||||||
4,733 | Bright Horizons Family Solutions, Inc.* | 224,392 | |||||||||
19,712 | Christopher & Banks Corp. | 233,587 | |||||||||
26,777 | Corinthian Colleges, Inc.* | 303,919 | |||||||||
10,475 | Deckers Outdoor Corp.* | 1,446,283 | |||||||||
10,004 | Gaiam, Inc., Class A* | 176,070 | |||||||||
18,399 | INVESTools, Inc.* | 213,244 | |||||||||
36,701 | NetFlix, Inc.* | 1,173,698 | |||||||||
30,858 | Warnaco Group (The), Inc.* | 1,423,788 | |||||||||
5,437,913 | |||||||||||
Energy—6.3% | |||||||||||
53,983 | Bois d'Arc Energy, Inc.* | 1,290,194 | |||||||||
31,929 | Comstock Resources, Inc.* | 1,452,450 | |||||||||
16,018 | ION Geophysical Corp.* | 255,167 | |||||||||
13,508 | Petroquest Energy, Inc.* | 280,696 | |||||||||
3,278,507 | |||||||||||
Financials—5.1% | |||||||||||
8,693 | eHealth, Inc.* | 235,146 | |||||||||
37,304 | Interactive Brokers Group, Inc., Class A* | 1,177,686 | |||||||||
50,044 | optionsXpress Holdings, Inc. | 1,074,445 | |||||||||
7,493 | Tower Group, Inc. | 176,011 | |||||||||
2,663,288 | |||||||||||
Health Care—25.3% | |||||||||||
5,177 | Air Methods Corp.* | 207,598 | |||||||||
89,569 | Alkermes, Inc.* | 1,113,343 | |||||||||
21,678 | Alliance Imaging, Inc.* | 176,676 | |||||||||
4,976 | Amedisys, Inc.* | 257,757 | |||||||||
3,638 | Analogic Corp. | 209,512 | |||||||||
7,896 | CONMED Corp.* | 201,506 | |||||||||
11,697 | Cubist Pharmaceuticals, Inc.* | 226,454 | |||||||||
15,701 | Dionex Corp.* | 1,228,131 | |||||||||
54,287 | Eclipsys Corp.* | 1,127,541 | |||||||||
46,867 | Emergency Medical Services Corp., Class A* | 1,057,788 | |||||||||
17,799 | eResearch Technology, Inc.* | 216,792 | |||||||||
19,949 | Haemonetics Corp.* | 1,141,681 | |||||||||
21,482 | Incyte Corp.* | 233,080 | |||||||||
8,529 | Invacare Corp. | 153,863 | |||||||||
7,428 | Martek Biosciences Corp.* | 261,911 | |||||||||
8,475 | Matria Healthcare, Inc.* | 216,113 | |||||||||
10,379 | Medicis Pharmaceutical Corp., Class A | 213,807 | |||||||||
33,821 | Meridian Bioscience, Inc. | 910,800 | |||||||||
26,973 | Owens & Minor, Inc. | 1,222,416 | |||||||||
42,185 | Parexel International Corp.* | 1,071,499 | |||||||||
7,384 | PharmaNet Development Group, Inc.* | 176,182 | |||||||||
12,165 | PSS World Medical, Inc.* | 200,358 | |||||||||
12,957 | Quidel Corp.* | 207,442 | |||||||||
21,404 | Varian, Inc.* | 1,090,106 | |||||||||
13,122,356 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Industrials—9.9% | |||||||||||
3,831 | Advisory Board (The) Co.* | $ | 178,601 | ||||||||
5,577 | Badger Meter, Inc. | 290,394 | |||||||||
23,919 | CBIZ, Inc.* | 212,162 | |||||||||
3,460 | Clean Harbors, Inc.* | 228,256 | |||||||||
5,127 | CoStar Group, Inc.* | 245,840 | |||||||||
5,605 | CRA International, Inc.* | 193,260 | |||||||||
3,736 | Dynamic Materials Corp. | 175,704 | |||||||||
4,063 | Esterline Technologies Corp.* | 226,147 | |||||||||
7,316 | Exponent, Inc.* | 246,842 | |||||||||
6,502 | II-VI, Inc.* | 241,484 | |||||||||
12,702 | Interface, Inc., Class A | 163,094 | |||||||||
4,984 | Kaydon Corp. | 261,012 | |||||||||
5,026 | L.B. Foster Co., Class A* | 161,335 | |||||||||
5,316 | Layne Christensen Co.* | 226,834 | |||||||||
3,131 | Middleby (The) Corp.* | 196,470 | |||||||||
53,535 | Orbital Sciences Corp.* | 1,440,626 | |||||||||
7,270 | Raven Industries, Inc. | 222,753 | |||||||||
5,818 | Waste Industries USA, Inc. | 219,630 | |||||||||
5,130,444 | |||||||||||
Information Technology—39.7% | |||||||||||
8,754 | Ansoft Corp.* | 290,283 | |||||||||
7,786 | ATMI, Inc.* | 229,220 | |||||||||
8,144 | Blackbaud, Inc. | 191,303 | |||||||||
9,067 | Blue Coat Systems, Inc.* | 191,404 | |||||||||
6,357 | Cabot Microelectronics Corp.* | 216,456 | |||||||||
11,013 | Cognex Corp. | 277,528 | |||||||||
4,907 | Comtech Telecommunications Corp.* | 190,048 | |||||||||
53,658 | Euronet Worldwide, Inc.* | 948,673 | |||||||||
7,991 | Forrester Research, Inc.* | 230,460 | |||||||||
61,292 | Gartner, Inc.* | 1,404,813 | |||||||||
23,892 | Harmonic, Inc.* | 197,587 | |||||||||
6,429 | Hittite Microwave Corp.* | 255,231 | |||||||||
66,381 | Informatica Corp.* | 1,059,441 | |||||||||
9,659 | Intermec, Inc.* | 203,998 | |||||||||
21,678 | Magma Design Automation, Inc.* | 202,256 | |||||||||
9,650 | Manhattan Associates, Inc.* | 250,997 | |||||||||
26,294 | ManTech International Corp., Class A* | 1,256,064 | |||||||||
12,793 | Monolithic Power Systems, Inc.* | 292,960 | |||||||||
39,829 | Net 1 UEPS Technologies, Inc.* | 933,592 | |||||||||
8,095 | Power Integrations, Inc.* | 252,321 | |||||||||
40,610 | Progress Software Corp.* | 1,227,640 | |||||||||
6,534 | Quality Systems, Inc. | 209,872 | |||||||||
29,439 | Rofin-Sinar Technologies, Inc.* | 1,121,037 | |||||||||
28,846 | Sapient Corp.* | 205,384 | |||||||||
6,267 | ScanSource, Inc.* | 156,487 | |||||||||
26,217 | Secure Computing Corp.* | 173,557 | |||||||||
16,710 | Semtech Corp.* | 271,370 | |||||||||
37,448 | Silicon Laboratories, Inc.* | 1,264,619 | |||||||||
25,710 | Sohu.com, Inc.* | 1,777,331 | |||||||||
48,842 | Solera Holdings, Inc.* | 1,260,612 |
See Notes to Financial Statements.
51
Schedule of Investments (Continued)
PowerShares Dynamic Small Cap Growth Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
25,556 | SonicWALL, Inc.* | $ | 196,526 | ||||||||
5,598 | SPSS, Inc.* | 236,460 | |||||||||
48,293 | SRA International, Inc., Class A* | 1,268,657 | |||||||||
12,679 | SYKES Enterprises, Inc.* | 210,725 | |||||||||
7,818 | Syntel, Inc. | 258,854 | |||||||||
24,526 | Tivo, Inc.* | 201,849 | |||||||||
15,371 | Tyler Technologies, Inc.* | 222,418 | |||||||||
57,663 | Verigy Ltd. (Singapore)* | 1,232,258 | |||||||||
20,570,291 | |||||||||||
Materials—0.4% | |||||||||||
13,028 | Calgon Carbon Corp.* | 185,649 | |||||||||
Telecommunication Services—0.5% | |||||||||||
9,980 | NTELOS Holdings Corp. | 258,282 | |||||||||
Utilities—2.3% | |||||||||||
50,590 | Cleco Corp. | 1,214,666 | |||||||||
Total Investments (Cost $51,098,786)—100.0% | 51,861,396 | ||||||||||
Liabilities in excess of other assets—(0.0%) | (15,146 | ) | |||||||||
Net Assets—100.0% | $ | 51,846,250 |
* Non-income producing security.
See Notes to Financial Statements.
52
Schedule of Investments
PowerShares Dynamic Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.8% | |||||||||||
Consumer Discretionary—13.5% | |||||||||||
7,538 | AnnTaylor Stores Corp.* | $ | 190,711 | ||||||||
793 | Arbitron, Inc. | 37,937 | |||||||||
2,724 | Bebe Stores, Inc. | 27,213 | |||||||||
1,677 | Blyth, Inc. | 28,241 | |||||||||
733 | Buckle (The), Inc. | 35,609 | |||||||||
1,708 | Charlotte Russe Holding, Inc.* | 27,123 | |||||||||
3,080 | Christopher & Banks Corp. | 36,498 | |||||||||
4,382 | Columbia Sportswear Co. | 183,869 | |||||||||
1,841 | Cooper Tire & Rubber Co. | 24,191 | |||||||||
4,184 | Corinthian Colleges, Inc.* | 47,488 | |||||||||
840 | Gymboree (The) Corp.* | 36,305 | |||||||||
6,893 | Jack in the Box, Inc.* | 184,388 | |||||||||
1,190 | JAKKS Pacific, Inc.* | 27,953 | |||||||||
7,860 | Men's Wearhouse (The), Inc. | 209,312 | |||||||||
1,728 | Movado Group, Inc. | 37,740 | |||||||||
5,734 | NetFlix, Inc.* | 183,373 | |||||||||
4,743 | Polaris Industries, Inc. | 220,787 | |||||||||
699 | Pre-Paid Legal Services, Inc.* | 30,574 | |||||||||
1,939 | Rent-A-Center, Inc.* | 41,747 | |||||||||
5,193 | Scholastic Corp.* | 146,183 | |||||||||
4,821 | Warnaco Group (The), Inc.* | 222,440 | |||||||||
1,660 | Winnebago Industries, Inc. | 26,709 | |||||||||
6,834 | Wolverine World Wide, Inc. | 196,409 | |||||||||
2,202,800 | |||||||||||
Consumer Staples—5.8% | |||||||||||
7,229 | Casey's General Stores, Inc. | 159,978 | |||||||||
608 | Coca-Cola Bottling Co. Consolidated | 34,790 | |||||||||
896 | Lancaster Colony Corp. | 34,218 | |||||||||
947 | Nash Finch Co. | 34,641 | |||||||||
3,265 | Ralcorp Holdings, Inc.* | 199,296 | |||||||||
5,615 | Ruddick Corp. | 217,300 | |||||||||
3,182 | Universal Corp. | 204,253 | |||||||||
1,809 | Vector Group Ltd. | 31,169 | |||||||||
1,070 | WD-40 Co. | 33,298 | |||||||||
948,943 | |||||||||||
Energy—3.8% | |||||||||||
4,405 | Berry Petroleum Co., Class A | 218,135 | |||||||||
1,549 | Bois d'Arc Energy, Inc.* | 37,021 | |||||||||
630 | Bristow Group, Inc.* | 33,233 | |||||||||
582 | Lufkin Industries, Inc. | 43,912 | |||||||||
4,295 | Oil States International, Inc.* | 215,008 | |||||||||
656 | Stone Energy Corp.* | 39,977 | |||||||||
841 | Trico Marine Services, Inc.* | 31,697 | |||||||||
618,983 | |||||||||||
Financials—16.7% | |||||||||||
1,991 | Amtrust Financial Services, Inc. | 30,960 | |||||||||
790 | BancFirst Corp. | 34,547 | |||||||||
894 | City Holding Co. | 37,173 | |||||||||
2,358 | CNA Surety Corp.* | 31,196 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
1,505 | Community Bank System, Inc. | $ | 38,362 | ||||||||
6,004 | Delphi Financial Group, Inc., Class A | 163,429 | |||||||||
1,939 | Employers Holdings, Inc. | 36,996 | |||||||||
1,131 | FBL Financial Group, Inc., Class A | 31,317 | |||||||||
1,274 | First Citizens BancShares, Inc., Class A | 179,341 | |||||||||
3,233 | GAMCO Investors, Inc., Class A | 148,750 | |||||||||
4,888 | Hancock Holding Co. | 201,728 | |||||||||
990 | Harleysville Group, Inc. | 36,086 | |||||||||
1,913 | Horace Mann Educators Corp. | 32,368 | |||||||||
827 | Infinity Property & Casualty Corp. | 32,055 | |||||||||
5,839 | Interactive Brokers Group, Inc., Class A* | 184,337 | |||||||||
6,677 | IPC Holdings Ltd. | 194,367 | |||||||||
11,297 | Knight Capital Group, Inc., Class A* | 211,367 | |||||||||
1,209 | National Interstate Corp. | 27,505 | |||||||||
608 | Navigators Group (The), Inc.* | 29,792 | |||||||||
7,818 | optionsXpress Holdings, Inc. | 167,852 | |||||||||
637 | RLI Corp. | 30,576 | |||||||||
897 | Safety Insurance Group, Inc. | 32,202 | |||||||||
1,400 | Selective Insurance Group, Inc. | 29,848 | |||||||||
1,225 | State Auto Financial Corp. | 33,749 | |||||||||
3,998 | SVB Financial Group* | 194,543 | |||||||||
3,465 | TradeStation Group, Inc.* | 32,328 | |||||||||
4,730 | UMB Financial Corp. | 234,797 | |||||||||
1,773 | United America Indemnity Ltd., Class A* | 27,411 | |||||||||
968 | United Fire & Casualty Co. | 31,896 | |||||||||
3,826 | Westamerica Bancorp | 223,591 | |||||||||
2,720,469 | |||||||||||
Health Care—10.2% | |||||||||||
809 | Air Methods Corp.* | 32,441 | |||||||||
777 | Amedisys, Inc.* | 40,249 | |||||||||
2,054 | AMN Healthcare Services, Inc.* | 29,968 | |||||||||
568 | Analogic Corp. | 32,711 | |||||||||
1,856 | Centene Corp.* | 34,095 | |||||||||
698 | Chemed Corp. | 23,802 | |||||||||
1,233 | CONMED Corp.* | 31,466 | |||||||||
956 | Datascope Corp. | 35,812 | |||||||||
2,452 | Dionex Corp.* | 191,794 | |||||||||
2,781 | eResearch Technology, Inc.* | 33,873 | |||||||||
1,542 | Gentiva Health Services, Inc.* | 33,523 | |||||||||
3,116 | Haemonetics Corp.* | 178,329 | |||||||||
1,896 | Healthspring, Inc.* | 31,929 | |||||||||
3,356 | Incyte Corp.* | 36,413 | |||||||||
1,332 | Invacare Corp. | 24,029 | |||||||||
4,179 | Magellan Health Services, Inc.* | 161,268 | |||||||||
1,161 | Martek Biosciences Corp.* | 40,937 | |||||||||
1,622 | Medicis Pharmaceutical Corp., Class A | 33,413 | |||||||||
971 | Meridian Bioscience, Inc. | 26,149 | |||||||||
1,051 | Molina Healthcare, Inc.* | 26,096 | |||||||||
4,215 | Owens & Minor, Inc. | 191,023 | |||||||||
1,154 | Pharmanet Development Group, Inc.* | 27,534 | |||||||||
2,024 | Quidel Corp.* | 32,404 |
See Notes to Financial Statements.
53
Schedule of Investments (Continued)
PowerShares Dynamic Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
1,544 | Res-Care, Inc.* | $ | 25,152 | ||||||||
1,646 | Triple-S Management Corp., Class B* | 30,023 | |||||||||
10,541 | Universal American Financial Corp.* | 113,105 | |||||||||
3,344 | Varian, Inc.* | 170,310 | |||||||||
1,667,848 | |||||||||||
Industrials—21.5% | |||||||||||
6,736 | Actuant Corp., Class A | 228,149 | |||||||||
1,350 | Administaff, Inc. | 35,357 | |||||||||
599 | Advisory Board (The) Co.* | 27,925 | |||||||||
301 | Ameron International Corp. | 29,739 | |||||||||
6,551 | Applied Industrial Technologies, Inc. | 158,272 | |||||||||
658 | Atlas Air Worldwide Holdings, Inc.* | 39,927 | |||||||||
870 | Badger Meter, Inc. | 45,301 | |||||||||
2,788 | Blount International, Inc.* | 34,488 | |||||||||
3,738 | CBIZ, Inc.* | 33,156 | |||||||||
1,162 | Columbus McKinnon Corp.* | 32,896 | |||||||||
876 | CRA International, Inc.* | 30,204 | |||||||||
1,301 | Cubic Corp. | 35,270 | |||||||||
1,597 | Deluxe Corp. | 33,952 | |||||||||
2,317 | Dollar Thrifty Automotive Group, Inc.* | 30,561 | |||||||||
583 | Dynamic Materials Corp. | 27,418 | |||||||||
1,127 | EnPro Industries, Inc.* | 40,910 | |||||||||
1,143 | Exponent, Inc.* | 38,565 | |||||||||
1,673 | First Advantage Corp., Class A* | 34,313 | |||||||||
869 | G&K Services, Inc., Class A | 27,400 | |||||||||
4,907 | Gardner Denver, Inc.* | 227,930 | |||||||||
1,100 | GeoEye, Inc.* | 25,333 | |||||||||
11,304 | GrafTech International Ltd.* | 222,124 | |||||||||
12,952 | Heartland Express, Inc. | 200,367 | |||||||||
972 | Heidrick & Struggles International, Inc. | 29,092 | |||||||||
6,126 | HNI Corp. | 133,363 | |||||||||
1,108 | Hub Group, Inc., Class A* | 36,221 | |||||||||
1,016 | II-VI, Inc.* | 37,734 | |||||||||
1,984 | Interface, Inc., Class A | 25,475 | |||||||||
778 | Kaydon Corp. | 40,744 | |||||||||
1,973 | Korn/Ferry International* | 36,816 | |||||||||
831 | Layne Christensen Co.* | 35,459 | |||||||||
4,515 | Mine Safety Appliances Co. | 167,823 | |||||||||
1,157 | Mueller Industries, Inc. | 37,452 | |||||||||
1,220 | Old Dominion Freight Line, Inc.* | 37,454 | |||||||||
8,364 | Orbital Sciences Corp.* | 225,075 | |||||||||
2,572 | Pike Electric Corp.* | 41,255 | |||||||||
1,135 | Raven Industries, Inc. | 34,776 | |||||||||
1,701 | Republic Airways Holdings, Inc.* | 28,679 | |||||||||
977 | Robbins & Myers, Inc. | 38,943 | |||||||||
2,244 | Rush Enterprises, Inc., Class A* | 36,173 | |||||||||
8,186 | SkyWest, Inc. | 155,780 | |||||||||
2,256 | Textainer Group Holdings Ltd. | 38,578 | |||||||||
2,662 | TrueBlue, Inc.* | 33,887 | |||||||||
9,009 | United Rentals, Inc.* | 169,730 | |||||||||
5,232 | Wabtec Corp. | 224,348 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
911 | Waste Industries USA, Inc. | $ | 34,390 | ||||||||
10,179 | Werner Enterprises, Inc. | 197,982 | |||||||||
3,516,786 | |||||||||||
Information Technology—20.8% | |||||||||||
2,617 | Acxiom Corp. | 30,959 | |||||||||
9,831 | ADTRAN, Inc. | 232,601 | |||||||||
15,464 | Amkor Technology, Inc.* | 147,681 | |||||||||
1,367 | Ansoft Corp.* | 45,330 | |||||||||
993 | Cabot Microelectronics Corp.* | 33,812 | |||||||||
1,374 | Checkpoint Systems, Inc.* | 35,628 | |||||||||
767 | Comtech Telecommunications Corp.* | 29,706 | |||||||||
4,600 | EarthLink, Inc.* | 41,998 | |||||||||
2,235 | Emulex Corp.* | 29,256 | |||||||||
16,241 | Fairchild Semiconductor International, Inc.* | 211,783 | |||||||||
1,005 | Hittite Microwave Corp.* | 39,899 | |||||||||
10,372 | Informatica Corp.* | 165,537 | |||||||||
21,583 | Integrated Device Technology, Inc.* | 230,722 | |||||||||
1,546 | j2 Global Communications, Inc.* | 33,084 | |||||||||
1,948 | JDA Software Group, Inc.* | 36,817 | |||||||||
1,066 | Littelfuse, Inc.* | 39,186 | |||||||||
1,507 | Manhattan Associates, Inc.* | 39,197 | |||||||||
4,109 | ManTech International Corp., Class A* | 196,287 | |||||||||
4,525 | Micrel, Inc. | 44,436 | |||||||||
499 | MicroStrategy, Inc., Class A* | 44,276 | |||||||||
2,918 | MPS Group, Inc.* | 31,310 | |||||||||
1,764 | Plantronics, Inc. | 43,941 | |||||||||
1,343 | Plexus Corp.* | 32,353 | |||||||||
1,265 | Power Integrations, Inc.* | 39,430 | |||||||||
1,165 | Progress Software Corp.* | 35,218 | |||||||||
1,021 | Quality Systems, Inc. | 32,795 | |||||||||
12,726 | Quest Software, Inc.* | 169,510 | |||||||||
846 | Rofin-Sinar Technologies, Inc.* | 32,216 | |||||||||
1,050 | Rogers Corp.* | 35,952 | |||||||||
979 | ScanSource, Inc.* | 24,446 | |||||||||
2,611 | Semtech Corp.* | 42,403 | |||||||||
5,851 | Silicon Laboratories, Inc.* | 197,588 | |||||||||
5,009 | Smart Modular Technologies (WWH), Inc.* | 30,204 | |||||||||
4,018 | Sohu.com, Inc.* | 277,765 | |||||||||
3,992 | SonicWALL, Inc.* | 30,698 | |||||||||
875 | SPSS, Inc.* | 36,960 | |||||||||
7,545 | SRA International, Inc., Class A* | 198,207 | |||||||||
1,174 | Standard Microsystems Corp.* | 34,809 | |||||||||
1,221 | Syntel, Inc. | 40,427 | |||||||||
25,685 | TIBCO Software, Inc.* | 197,004 | |||||||||
7,047 | TriQuint Semiconductor, Inc.* | 46,440 | |||||||||
1,654 | Verigy Ltd. (Singapore)* | 35,346 | |||||||||
1,149 | Wright Express Corp.* | 37,917 | |||||||||
3,391,134 | |||||||||||
Materials—4.5% | |||||||||||
21,923 | Chemtura Corp. | 151,707 | |||||||||
2,526 | Glatfelter | 36,854 |
See Notes to Financial Statements.
54
Schedule of Investments (Continued)
PowerShares Dynamic Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
797 | Koppers Holdings, Inc. | $ | 38,607 | ||||||||
552 | Minerals Technologies, Inc. | 37,392 | |||||||||
497 | NewMarket Corp. | 32,270 | |||||||||
9,422 | Olin Corp. | 190,043 | |||||||||
2,991 | OM Group, Inc.* | 163,787 | |||||||||
1,240 | Rock-Tenn Co., Class A | 42,073 | |||||||||
1,234 | Sensient Technologies Corp. | 36,736 | |||||||||
729,469 | |||||||||||
Telecommunication Services—0.4% | |||||||||||
1,082 | Atlantic Tele-Network, Inc. | 33,683 | |||||||||
2,354 | Premiere Global Services, Inc.* | 34,180 | |||||||||
67,863 | |||||||||||
Utilities—2.6% | |||||||||||
5,063 | Black Hills Corp. | 197,507 | |||||||||
974 | Laclede Group (The), Inc. | 36,837 | |||||||||
7,762 | Portland General Electric Co. | 186,288 | |||||||||
420,632 | |||||||||||
Total Common Stocks (Cost $15,980,838) | 16,284,927 | ||||||||||
Money Market Fund—0.5% | |||||||||||
78,559 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $78,559) | 78,559 | |||||||||
Total Investments (Cost $16,059,397)—100.3% | 16,363,486 | ||||||||||
Liabilities in excess of other assets—(0.3%) | (49,969 | ) | |||||||||
Net Assets—100.0% | $ | 16,313,517 |
* Non-income producing security.
See Notes to Financial Statements.
55
Schedule of Investments
PowerShares Dynamic Small Cap Value Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.9% | |||||||||||
Consumer Discretionary—15.0% | |||||||||||
84,028 | AnnTaylor Stores Corp.* | $ | 2,125,908 | ||||||||
18,695 | Blyth, Inc. | 314,824 | |||||||||
10,178 | CBRL Group, Inc. | 375,975 | |||||||||
19,041 | Charlotte Russe Holding, Inc.* | 302,371 | |||||||||
48,834 | Columbia Sportswear Co. | 2,049,075 | |||||||||
9,364 | Gymboree (The) Corp.* | 404,712 | |||||||||
23,478 | Helen of Troy Ltd.* | 397,013 | |||||||||
76,830 | Jack in the Box, Inc.* | 2,055,203 | |||||||||
13,263 | JAKKS Pacific, Inc.* | 311,548 | |||||||||
52,864 | Polaris Industries, Inc. | 2,460,820 | |||||||||
21,616 | Rent-A-Center, Inc.* | 465,392 | |||||||||
10,632 | Scholastic Corp.* | 299,291 | |||||||||
76,164 | Wolverine World Wide, Inc. | 2,188,953 | |||||||||
13,751,085 | |||||||||||
Consumer Staples—9.2% | |||||||||||
6,779 | Coca-Cola Bottling Co. Consolidated | 387,894 | |||||||||
9,984 | Lancaster Colony Corp. | 381,289 | |||||||||
10,571 | Nash Finch Co. | 386,687 | |||||||||
36,399 | Ralcorp Holdings, Inc.* | 2,221,795 | |||||||||
62,585 | Ruddick Corp. | 2,422,040 | |||||||||
35,466 | Universal Corp. | 2,276,563 | |||||||||
11,927 | WD-40 Co. | 371,168 | |||||||||
8,447,436 | |||||||||||
Energy—6.7% | |||||||||||
49,096 | Berry Petroleum Co., Class A | 2,431,234 | |||||||||
6,486 | Lufkin Industries, Inc. | 489,369 | |||||||||
47,873 | Oil States International, Inc.* | 2,396,522 | |||||||||
7,304 | Stone Energy Corp.* | 445,106 | |||||||||
9,381 | Trico Marine Services, Inc.* | 353,570 | |||||||||
6,115,801 | |||||||||||
Financials—22.3% | |||||||||||
22,198 | Amtrust Financial Services, Inc. | 345,179 | |||||||||
8,799 | BancFirst Corp. | 384,780 | |||||||||
9,954 | City Holding Co. | 413,887 | |||||||||
26,272 | CNA Surety Corp.* | 347,579 | |||||||||
16,775 | Community Bank System, Inc. | 427,595 | |||||||||
66,920 | Delphi Financial Group, Inc., Class A | 1,821,562 | |||||||||
21,616 | Employers Holdings, Inc. | 412,433 | |||||||||
12,605 | FBL Financial Group, Inc., Class A | 349,032 | |||||||||
14,194 | First Citizens BancShares, Inc., Class A | 1,998,089 | |||||||||
11,040 | Harleysville Group, Inc. | 402,408 | |||||||||
21,330 | Horace Mann Educators Corp. | 360,904 | |||||||||
9,229 | Infinity Property & Casualty Corp. | 357,716 | |||||||||
74,422 | IPC Holdings Ltd. | 2,166,424 | |||||||||
125,909 | Knight Capital Group, Inc., Class A* | 2,355,758 | |||||||||
13,471 | National Interstate Corp. | 306,465 | |||||||||
6,774 | Navigators Group (The), Inc.* | 331,926 | |||||||||
32,575 | Phoenix (The) Cos., Inc. | 423,475 | |||||||||
7,098 | RLI Corp. | 340,704 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
9,995 | Safety Insurance Group, Inc. | $ | 358,821 | ||||||||
15,602 | Selective Insurance Group | 332,635 | |||||||||
13,659 | State Auto Financial Corp. | 376,305 | |||||||||
52,726 | UMB Financial Corp. | 2,617,320 | |||||||||
19,760 | United America Indemnity Ltd., Class A* | 305,490 | |||||||||
10,793 | United Fire & Casualty Co. | 355,629 | |||||||||
42,644 | Westamerica Bancorp | 2,492,116 | |||||||||
20,384,232 | |||||||||||
Health Care—1.2% | |||||||||||
20,687 | Centene Corp.* | 380,020 | |||||||||
21,123 | Healthspring, Inc.* | 355,711 | |||||||||
18,353 | TRIPLE-S Management Corp., Class B* | 334,759 | |||||||||
1,070,490 | |||||||||||
Industrials—15.3% | |||||||||||
13,413 | Applied Industrial Technologies, Inc. | 324,058 | |||||||||
13,880 | Arkansas Best Corp. | 547,982 | |||||||||
7,326 | Atlas Air Worldwide Holdings, Inc.* | 444,542 | |||||||||
12,944 | Columbus McKinnon Corp.* | 366,445 | |||||||||
14,498 | Cubic Corp. | 393,041 | |||||||||
17,797 | Deluxe Corp. | 378,364 | |||||||||
12,554 | EnPro Industries, Inc.* | 455,710 | |||||||||
18,639 | First Advantage Corp., Class A* | 382,286 | |||||||||
9,690 | G&K Services, Inc., Class A | 305,526 | |||||||||
10,829 | Heidrick & Struggles International, Inc. | 324,112 | |||||||||
68,280 | HNI Corp. | 1,486,456 | |||||||||
21,988 | Korn/Ferry International* | 410,296 | |||||||||
12,903 | Mueller Industries, Inc. | 417,670 | |||||||||
13,604 | Old Dominion Freight Line, Inc.* | 417,643 | |||||||||
18,963 | Republic Airways Holdings, Inc.* | 319,716 | |||||||||
25,014 | Rush Enterprises, Inc., Class A* | 403,226 | |||||||||
91,244 | Skywest, Inc. | 1,736,373 | |||||||||
25,151 | Textainer Group Holdings Ltd. | 430,082 | |||||||||
29,681 | TrueBlue, Inc.* | 377,839 | |||||||||
100,415 | United Rentals, Inc.* | 1,891,819 | |||||||||
113,454 | Werner Enterprises, Inc. | 2,206,679 | |||||||||
14,019,865 | |||||||||||
Information Technology—14.5% | |||||||||||
29,167 | Acxiom Corp. | 345,046 | |||||||||
109,573 | ADTRAN, Inc. | 2,592,498 | |||||||||
172,359 | Amkor Technology, Inc.* | 1,646,028 | |||||||||
51,275 | EarthLink, Inc.* | 468,141 | |||||||||
24,914 | Emulex Corp.* | 326,124 | |||||||||
181,016 | Fairchild Semiconductor International, Inc.* | 2,360,449 | |||||||||
240,564 | Integrated Device Technology, Inc.* | 2,571,629 | |||||||||
50,438 | Micrel, Inc. | 495,301 | |||||||||
32,518 | MPS Group, Inc.* | 348,918 | |||||||||
11,885 | MTS Systems Corp. | 408,606 | |||||||||
19,655 | Plantronics, Inc. | 489,606 | |||||||||
11,702 | Rogers Corp.* | 400,676 |
See Notes to Financial Statements.
56
Schedule of Investments (Continued)
PowerShares Dynamic Small Cap Value Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
55,830 | Smart Modular Technologies (WWH), Inc.* | $ | 336,655 | ||||||||
78,541 | TriQuint Semiconductor, Inc.* | 517,585 | |||||||||
13,307,262 | |||||||||||
Materials—7.9% | |||||||||||
244,351 | Chemtura Corp. | 1,690,909 | |||||||||
16,295 | H.B. Fuller Co. | 376,089 | |||||||||
8,876 | Koppers Holdings, Inc. | 429,953 | |||||||||
5,537 | NewMarket Corp. | 359,517 | |||||||||
105,012 | Olin Corp. | 2,118,092 | |||||||||
33,345 | OM Group, Inc.* | 1,825,972 | |||||||||
13,817 | Rock-Tenn Co., Class A | 468,811 | |||||||||
7,269,343 | |||||||||||
Telecommunication Services—0.4% | |||||||||||
12,056 | Atlantic Tele-Network, Inc. | 375,303 | |||||||||
Utilities—7.4% | |||||||||||
56,441 | Black Hills Corp. | 2,201,763 | |||||||||
10,856 | Laclede Group (The), Inc. | 410,574 | |||||||||
86,512 | Portland General Electric Co. | 2,076,288 | |||||||||
64,710 | WGL Holdings, Inc. | 2,122,488 | |||||||||
6,811,113 | |||||||||||
Total Common Stocks (Cost $90,900,047) | 91,551,930 | ||||||||||
Money Market Fund—0.0% | |||||||||||
24,622 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $24,622) | 24,622 | |||||||||
Total Investments (Cost $90,924,669)—99.9% | 91,576,552 | ||||||||||
Other assets less liabilities—0.1% | 90,174 | ||||||||||
Net Assets—100.0% | $ | 91,666,726 |
* Non-income producing security.
See Notes to Financial Statements.
57
Schedule of Investments
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.7% | |||||||||||
Consumer Discretionary—9.6% | |||||||||||
231 | 1-800-FLOWERS.COM, Inc., Class A* | $ | 2,037 | ||||||||
131 | A.C. Moore Arts & Crafts, Inc.* | 866 | |||||||||
182 | AFC Enterprises, Inc.* | 1,884 | |||||||||
193 | Aftermarket Technology Corp.* | 4,422 | |||||||||
92 | Alloy, Inc.* | 636 | |||||||||
170 | Ambassadors Group, Inc. | 3,308 | |||||||||
71 | Ambassadors International, Inc. | 358 | |||||||||
104 | America's Car-Mart, Inc.* | 1,497 | |||||||||
190 | Amerigon, Inc.* | 2,789 | |||||||||
104 | Arctic Cat, Inc. | 788 | |||||||||
181 | Audiovox Corp., Class A* | 1,977 | |||||||||
54 | Avatar Holdings, Inc.* | 2,206 | |||||||||
1,000 | Ballard Power Systems, Inc. (Canada)* | 4,210 | |||||||||
103 | Bassett Furniture Industries, Inc. | 1,230 | |||||||||
41 | Benihana, Inc.* | 426 | |||||||||
78 | Benihana, Inc., Class A* | 810 | |||||||||
194 | Big 5 Sporting Goods Corp. | 1,783 | |||||||||
230 | BJ's Restaurants, Inc.* | 3,206 | |||||||||
93 | Bon-Ton Stores (The), Inc. | 816 | |||||||||
104 | Books-A-Million, Inc. | 842 | |||||||||
115 | Buffalo Wild Wings, Inc.* | 3,536 | |||||||||
136 | Cache, Inc.* | 1,667 | |||||||||
254 | California Pizza Kitchen, Inc.* | 3,960 | |||||||||
83 | Carmike Cinemas, Inc. | 681 | |||||||||
95 | Carrols Restaurant Group, Inc.* | 765 | |||||||||
364 | Casual Male Retail Group, Inc.* | 1,572 | |||||||||
56 | Cavco Industries, Inc.* | 2,236 | |||||||||
154 | Century Casinos, Inc.* | 511 | |||||||||
164 | Charlotte Russe Holding, Inc.* | 2,604 | |||||||||
3,504 | Charter Communications, Inc., Class A* | 3,749 | |||||||||
78 | Cherokee, Inc. | 2,262 | |||||||||
92 | Citi Trends, Inc.* | 1,945 | |||||||||
157 | Conn's, Inc.* | 2,768 | |||||||||
68 | Core-Mark Holding Co., Inc.* | 1,949 | |||||||||
359 | Cosi, Inc.* | 829 | |||||||||
129 | Crown Media Holdings, Inc., Class A* | 588 | |||||||||
241 | Cumulus Media, Inc., Class A* | 1,422 | |||||||||
269 | dELiA*s, Inc.* | 683 | |||||||||
818 | Denny's Corp.* | 2,577 | |||||||||
156 | DG FastChannel, Inc.* | 2,909 | |||||||||
107 | Dixie Group, Inc.* | 835 | |||||||||
632 | Drugstore.Com, Inc.* | 1,498 | |||||||||
41 | DXP Enterprises, Inc.* | 1,692 | |||||||||
267 | Eddie Bauer Holdings, Inc.* | 1,063 | |||||||||
138 | Einstein Noah Restaurant Group, Inc.* | 1,553 | |||||||||
267 | Emmis Communications Corp., Class A* | 830 | |||||||||
193 | Empire Resorts, Inc.* | 519 | |||||||||
111 | Escalade, Inc. | 766 | |||||||||
658 | Exide Technologies* | 9,601 | |||||||||
140 | FGX International Holdings Ltd.* | 1,827 | |||||||||
430 | Finish Line (The), Inc., Class A | 2,825 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
57 | Fisher Communications, Inc.* | $ | 1,867 | ||||||||
353 | Fred's, Inc., Class A | 3,911 | |||||||||
102 | Fuel Systems Solutions, Inc.* | 1,904 | |||||||||
126 | Gaiam, Inc., Class A* | 2,218 | |||||||||
107 | G-III Apparel Group Ltd.* | 1,578 | |||||||||
265 | Great Wolf Resorts, Inc.* | 1,619 | |||||||||
461 | Harris Interactive, Inc.* | 1,153 | |||||||||
875 | Hayes Lemmerz International, Inc.* | 2,625 | |||||||||
71 | Heelys, Inc.* | 309 | |||||||||
202 | Helen of Troy Ltd.* | 3,416 | |||||||||
80 | Home Inns & Hotels Management, Inc. ADR (China)* | 1,793 | |||||||||
104 | Hooker Furniture Corp. | 2,181 | |||||||||
381 | HOT Topic, Inc.* | 2,023 | |||||||||
352 | Imax Corp. (Canada)* | 2,330 | |||||||||
573 | INVESTools, Inc.* | 6,641 | |||||||||
43 | iRobot Corp.* | 690 | |||||||||
460 | Jamba, Inc.* | 1,155 | |||||||||
157 | Jos. A Bank Clothiers, Inc.* | 3,832 | |||||||||
309 | Knology, Inc.* | 3,961 | |||||||||
232 | K-Swiss, Inc., Class A | 3,399 | |||||||||
160 | Lakes Entertainment, Inc.* | 742 | |||||||||
82 | Lifetime Brands, Inc. | 699 | |||||||||
68 | Lincoln Educational Services Corp.* | 794 | |||||||||
199 | LodgeNet Interactive Corp.* | 1,218 | |||||||||
128 | McCormick & Schmick's Seafood Restaurants, Inc.* | 1,540 | |||||||||
230 | MDC Partners, Inc., Class A (Canada)* | 1,888 | |||||||||
515 | Mediacom Communications Corp., Class A* | 2,209 | |||||||||
125 | Monarch Casino & Resort, Inc.* | 1,655 | |||||||||
162 | Monro Muffler, Inc. | 2,673 | |||||||||
304 | Morgans Hotel Group Co.* | 4,253 | |||||||||
52 | Mothers Work, Inc.* | 727 | |||||||||
241 | MTR Gaming Group, Inc.* | 1,477 | |||||||||
230 | Multimedia Games, Inc.* | 980 | |||||||||
120 | NET Servicos de Comunicacao S.A. ADR (Brazil) | 1,638 | |||||||||
209 | New Frontier Media, Inc. | 1,097 | |||||||||
481 | NexCen Brands, Inc.* | 1,472 | |||||||||
155 | Noble International Ltd. | 969 | |||||||||
194 | O'Charleys, Inc. | 2,250 | |||||||||
118 | Outdoor Channel Holdings, Inc.* | 881 | |||||||||
155 | Overstock.com, Inc.* | 2,979 | |||||||||
200 | Palm Harbor Homes, Inc.* | 1,722 | |||||||||
211 | Parent (The) Co.* | 570 | |||||||||
121 | Peet's Coffee & Tea, Inc.* | 2,811 | |||||||||
96 | Perry Ellis International, Inc.* | 2,193 | |||||||||
161 | PetMed Express, Inc.* | 1,806 | |||||||||
263 | Premier Exhibitions, Inc.* | 1,528 | |||||||||
212 | Princeton Review, Inc.* | 1,603 | |||||||||
233 | Private Media Group Ltd.* | 291 | |||||||||
543 | Progressive Gaming International Corp.* | 929 |
See Notes to Financial Statements.
58
Schedule of Investments (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
577 | Radio One, Inc., Class D* | $ | 577 | ||||||||
166 | RC2 Corp.* | 3,071 | |||||||||
330 | RCN Corp. | 3,782 | |||||||||
254 | Restoration Hardware, Inc.* | 1,105 | |||||||||
45 | RRSat Global Communications Network Ltd. | 637 | |||||||||
151 | Ruth's Chris Steak House, Inc.* | 1,110 | |||||||||
120 | Salem Communications Corp., Class A | 408 | |||||||||
391 | Select Comfort Corp.* | 1,181 | |||||||||
57 | Shiloh Industries, Inc. | 560 | |||||||||
83 | Shoe Carnival, Inc.* | 1,160 | |||||||||
308 | Shuffle Master, Inc.* | 1,512 | |||||||||
104 | Shutterfly, Inc.* | 1,700 | |||||||||
248 | Silverleaf Resorts, Inc.* | 546 | |||||||||
231 | Sinclair Broadcast Group, Inc., Class A | 2,030 | |||||||||
262 | Smith & Wesson Holding Corp.* | 1,965 | |||||||||
453 | Source Interlink Cos., Inc,* | 639 | |||||||||
286 | Spartan Motors, Inc. | 2,686 | |||||||||
130 | Stamps.com, Inc.* | 1,782 | |||||||||
91 | Stanley Furniture Co., Inc. | 1,117 | |||||||||
273 | Stein Mart, Inc. | 1,455 | |||||||||
176 | Steven Madden Ltd.* | 3,328 | |||||||||
31 | Strattec Security Corp. | 1,140 | |||||||||
814 | Syntax-Brillian Corp.* | 993 | |||||||||
92 | Town Sports International Holdings, Inc.* | 683 | |||||||||
204 | Trans World Entertainment Corp.* | 741 | |||||||||
154 | True Religion Apparel, Inc.* | 2,827 | |||||||||
203 | Trump Entertainment Resorts, Inc.* | 566 | |||||||||
274 | Tuesday Morning Corp. | 1,491 | |||||||||
127 | Universal Electronics, Inc.* | 3,264 | |||||||||
104 | US Auto Parts Network, Inc.* | 363 | |||||||||
236 | ValueVision Media, Inc., Class A* | 1,319 | |||||||||
116 | VCG Holding Corp.* | 510 | |||||||||
143 | West Marine, Inc.* | 715 | |||||||||
818 | Wet Seal (The), Inc., Class A* | 2,838 | |||||||||
101 | Weyco Group, Inc. | 2,758 | |||||||||
157 | Wonder Auto Technology, Inc.* | 1,195 | |||||||||
372 | WorldSpace, Inc., Class A* | 554 | |||||||||
246,820 | |||||||||||
Consumer Staples—3.2% | |||||||||||
95 | AgFeed Industries, Inc. (China)* | 1,585 | |||||||||
48 | Alico, Inc. | 1,917 | |||||||||
156 | Andersons (The), Inc. | 7,091 | |||||||||
21 | Arden Group, Inc., Class A | 2,814 | |||||||||
125 | Calavo Growers, Inc. | 2,059 | |||||||||
140 | Cal-Maine Foods, Inc. | 4,137 | |||||||||
194 | Central Garden & Pet Co.* | 999 | |||||||||
417 | Central Garden & Pet Co., Class A* | 2,093 | |||||||||
44 | Coca-Cola Bottling Co. Consolidated | 2,518 | |||||||||
372 | Cresud S.A. ADR (Argentina) | 6,083 | |||||||||
140 | Diamond Foods, Inc. | 2,990 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
70 | Farmer Bros. Co. | $ | 1,730 | ||||||||
156 | Green Mountain Coffee Roasters, Inc.* | 5,023 | |||||||||
103 | Imperial Sugar Co. | 1,624 | |||||||||
54 | Ingles Markets, Inc., Class A | 1,232 | |||||||||
72 | Inter Parfums, Inc. | 2,085 | |||||||||
122 | J & J Snack Foods Corp. | 3,494 | |||||||||
229 | Jones Soda Co.* | 742 | |||||||||
174 | Mannatech, Inc. | 1,136 | |||||||||
108 | MGP Ingredients, Inc. | 791 | |||||||||
117 | Nash Finch Co. | 4,280 | |||||||||
120 | National Beverage Corp. | 967 | |||||||||
97 | Nutraceutical International Corp.* | 1,091 | |||||||||
86 | Origin Agritech Ltd. (British Virgin Islands)* | 549 | |||||||||
123 | Physicians Formula Holdings, Inc.* | 1,422 | |||||||||
259 | PriceSmart, Inc. | 7,395 | |||||||||
105 | Reliv International, Inc. | 709 | |||||||||
548 | Smart Balance, Inc.* | 4,055 | |||||||||
189 | Spartan Stores, Inc. | 3,946 | |||||||||
559 | SunOpta, Inc. (Canada)* | 3,091 | |||||||||
74 | Susser Holdings Corp.* | 1,131 | |||||||||
170 | Zhongpin, Inc. (China)* | 1,785 | |||||||||
82,564 | |||||||||||
Energy—4.9% | |||||||||||
103 | APCO Argentina, Inc. (Argentina) | 2,536 | |||||||||
131 | A-Power Energy Generation Systems Ltd.* | 2,066 | |||||||||
400 | Brigham Exploration Co.* | 3,776 | |||||||||
114 | Bronco Drilling Co., Inc.* | 1,961 | |||||||||
50 | Clayton Williams Energy, Inc.* | 3,160 | |||||||||
116 | Clean Energy Fuels Corp.* | 1,510 | |||||||||
63 | Dampskibsselskabet Torm A/S ADR (Denmark) | 2,075 | |||||||||
67 | Dawson Geophysical Co.* | 4,847 | |||||||||
80 | Double Eagle Petroleum Co.* | 1,451 | |||||||||
248 | Edge Petroleum Corp.* | 1,295 | |||||||||
176 | EnGlobal Corp.* | 1,769 | |||||||||
331 | FX Energy, Inc.* | 1,648 | |||||||||
169 | GeoMet, Inc.* | 1,141 | |||||||||
116 | GMX Resources, Inc.* | 4,215 | |||||||||
124 | Gulf Island Fabrication, Inc. | 4,903 | |||||||||
278 | Gulfport Energy Corp.* | 3,222 | |||||||||
1,607 | Ivanhoe Energy, Inc. (Canada)* | 3,134 | |||||||||
186 | James River Coal Co.* | 4,135 | |||||||||
150 | Knightsbridge Tankers Ltd. (Bermuda) | 4,329 | |||||||||
244 | Matrix Service Co.* | 4,907 | |||||||||
85 | Mitcham Industries, Inc.* | 1,590 | |||||||||
229 | NGAS Resources, Inc.* | 1,562 | |||||||||
39 | OYO Geospace Corp.* | 1,888 | |||||||||
353 | Pacific Ethanol, Inc.* | 1,211 | |||||||||
361 | Parallel Petroleum Corp.* | 7,649 | |||||||||
109 | PHI, Inc.* | 4,095 | |||||||||
6 | PrimeEnergy Corp.* | 342 |
See Notes to Financial Statements.
59
Schedule of Investments (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
197 | Quest Resource Corp.* | $ | 1,741 | ||||||||
266 | RAM Energy Resources, Inc.* | 1,343 | |||||||||
135 | Rex Energy Corp.* | 2,930 | |||||||||
146 | StealthGas, Inc. (Greece) | 2,342 | |||||||||
90 | Superior Offshore International, Inc.* | 13 | |||||||||
154 | Superior Well Services, Inc.* | 3,667 | |||||||||
106 | T-3 Energy Services, Inc.* | 5,597 | |||||||||
320 | Tesco Corp. (Canada)* | 8,885 | |||||||||
170 | TOP Ships, Inc. (Greece)* | 1,428 | |||||||||
127 | Toreador Resources Corp.* | 1,043 | |||||||||
522 | Transglobe Energy Corp. (Canada)* | 2,380 | |||||||||
33 | Trico Marine Services, Inc.* | 1,244 | |||||||||
299 | TXCO Resources, Inc.* | 3,821 | |||||||||
96 | Union Drilling, Inc.* | 1,623 | |||||||||
453 | Uranium Resources, Inc.* | 2,700 | |||||||||
416 | Verenium Corp.* | 1,248 | |||||||||
509 | Warren Resources, Inc.* | 6,250 | |||||||||
124,672 | |||||||||||
Financials—17.0% | |||||||||||
160 | 1st Source Corp. | 3,171 | |||||||||
72 | 21st Century Holding Co. | 918 | |||||||||
214 | Abington Bancorp, Inc. | 2,238 | |||||||||
95 | Advanta Corp., Class A | 721 | |||||||||
248 | Advanta Corp., Class B | 2,177 | |||||||||
134 | Affirmative Insurance Holdings, Inc. | 1,049 | |||||||||
196 | AMCORE Financial, Inc. | 2,438 | |||||||||
30 | American Bancorp of New Jersey | 315 | |||||||||
92 | American Physicians Capital, Inc. | 4,264 | |||||||||
149 | AmericanWest Bancorp | 544 | |||||||||
118 | Ameris Bancorp | 1,768 | |||||||||
164 | Amerisafe, Inc.* | 2,339 | |||||||||
202 | Ampal American Israel Corp., Class A* | 1,246 | |||||||||
187 | Anchor Bancorp Wisconsin, Inc. | 2,841 | |||||||||
93 | Arrow Financial Corp. | 2,163 | |||||||||
134 | Asset Acceptance Capital Corp. | 1,615 | |||||||||
122 | Asta Funding, Inc. | 1,741 | |||||||||
82 | Baldwin & Lyons, Inc., Class B | 1,949 | |||||||||
120 | Bancorp (The), Inc.* | 1,327 | |||||||||
42 | Bancorp Rhode Island, Inc. | 1,407 | |||||||||
154 | BancTrust Financial Group, Inc. | 1,662 | |||||||||
111 | Bank of Florida Corp.* | 1,231 | |||||||||
138 | Bank of Granite Corp. | 1,449 | |||||||||
45 | Bank of Marin Bancorp | 1,305 | |||||||||
109 | Bank of the Ozarks, Inc. | 2,720 | |||||||||
195 | BankFinancial Corp. | 3,128 | |||||||||
306 | BankUnited Financial Corp., Class A | 1,203 | |||||||||
140 | Banner Corp. | 3,024 | |||||||||
92 | Berkshire Hills Bancorp, Inc. | 2,354 | |||||||||
123 | Beverly Hills Bancorp, Inc. | 252 | |||||||||
130 | BGC Partners, Inc., Class A* | 1,253 | |||||||||
62 | Brooke Corp. | 114 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
113 | Capital City Bank Group, Inc. | $ | 2,966 | ||||||||
94 | Capital Corp. of the West | 644 | |||||||||
25 | Capital Southwest Corp. | 2,974 | |||||||||
213 | Cardinal Financial Corp. | 1,640 | |||||||||
245 | Cascade Bancorp | 2,234 | |||||||||
106 | Cascade Financial Corp. | 1,149 | |||||||||
100 | Castlepoint Holdings Ltd. (Bermuda) | 920 | |||||||||
460 | Centennial Bank Holdings, Inc.* | 2,880 | |||||||||
115 | Center Bancorp, Inc. | 1,114 | |||||||||
107 | Center Financial Corp. | 1,114 | |||||||||
109 | Centerstate Banks of Florida, Inc. | 1,504 | |||||||||
95 | CFS Bancorp, Inc. | 1,363 | |||||||||
72 | Citizens First Bancorp, Inc. | 573 | |||||||||
137 | City Bank | 2,482 | |||||||||
119 | Clifton Savings Bancorp, Inc. | 1,190 | |||||||||
102 | CNinsure, Inc. ADR (Cayman Islands)* | 1,433 | |||||||||
151 | CoBiz Financial, Inc. | 1,678 | |||||||||
87 | Columbia Bancorp | 902 | |||||||||
156 | Columbia Banking System, Inc. | 4,224 | |||||||||
90 | Community Bancorp* | 999 | |||||||||
132 | Community Trust Bancorp, Inc. | 3,968 | |||||||||
362 | Corus Bankshares, Inc. | 2,653 | |||||||||
140 | Cowen Group, Inc.* | 931 | |||||||||
156 | Danvers Bancorp, Inc.* | 1,741 | |||||||||
297 | Dime Community Bancshares, Inc. | 5,545 | |||||||||
211 | Dollar Financial Corp.* | 4,553 | |||||||||
128 | Donegal Group, Inc., Class A | 2,175 | |||||||||
64 | eHealth, Inc.* | 1,731 | |||||||||
24 | EMC Insurance Group, Inc. | 701 | |||||||||
66 | Encore Bancshares, Inc.* | 1,156 | |||||||||
201 | Encore Capital Group, Inc.* | 1,347 | |||||||||
110 | Enterprise Financial Services Corp. | 2,360 | |||||||||
89 | Epoch Holding Corp. | 1,058 | |||||||||
335 | EZCORP, Inc., Class A* | 4,067 | |||||||||
64 | Farmers Capital Bank Corp. | 1,569 | |||||||||
61 | Fidelity Southern Corp. | 467 | |||||||||
73 | Financial Institutions, Inc. | 1,424 | |||||||||
125 | First Bancorp | 2,353 | |||||||||
318 | First Busey Corp. | 6,307 | |||||||||
269 | First Cash Financial Services, Inc.* | 3,992 | |||||||||
98 | First Community Bancshares, Inc. | 3,275 | |||||||||
71 | First Defiance Financial Corp. | 1,327 | |||||||||
245 | First Financial Bancorp | 3,214 | |||||||||
87 | First Financial Corp. | 2,767 | |||||||||
102 | First Financial Holdings, Inc. | 2,449 | |||||||||
158 | First Merchants Corp. | 4,040 | |||||||||
144 | First Place Financial Corp. | 1,800 | |||||||||
79 | First Regional Bancorp* | 1,173 | |||||||||
147 | First Security Group, Inc. | 1,348 | |||||||||
86 | First South Bancorp, Inc. | 1,921 | |||||||||
176 | First State Bancorporation | 1,637 | |||||||||
185 | Flushing Financial Corp. | 3,611 |
See Notes to Financial Statements.
60
Schedule of Investments (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
222 | FNB Corp. | $ | 3,432 | ||||||||
100 | FNB United Corp. | 1,100 | |||||||||
63 | Fox Chase Bancorp, Inc.* | 735 | |||||||||
80 | FPIC Insurance Group, Inc.* | 3,722 | |||||||||
222 | Franklin Bank Corp.* | 344 | |||||||||
138 | FX Real Estate & Entertainment, Inc.* | 664 | |||||||||
124 | GB&T Bancshares, Inc. | 1,069 | |||||||||
96 | German American Bancorp, Inc. | 1,219 | |||||||||
88 | Great Southern Bancorp, Inc. | 1,327 | |||||||||
113 | Greene Bankshares, Inc. | 2,263 | |||||||||
52 | Greenlight Capital Re Ltd., Class A (Cayman Islands)* | 911 | |||||||||
366 | Grupo Financiero Galicia S.A. ADR (Argentina)* | 2,295 | |||||||||
182 | Hallmark Financial Services, Inc.* | 1,971 | |||||||||
301 | Hanmi Financial Corp. | 2,104 | |||||||||
274 | Harleysville National Corp. | 3,962 | |||||||||
203 | Harris & Harris Group, Inc.* | 1,614 | |||||||||
145 | Heartland Financial USA, Inc. | 3,263 | |||||||||
112 | Heritage Commerce Corp. | 1,980 | |||||||||
113 | Home Bancshares, Inc. | 2,625 | |||||||||
75 | Home Federal Bancorp, Inc. | 896 | |||||||||
105 | Horizon Financial Corp. | 1,289 | |||||||||
112 | IBERIABANK Corp. | 5,398 | |||||||||
198 | Independent Bank Corp. | 1,580 | |||||||||
134 | Independent Bank Corp./MA | 3,917 | |||||||||
182 | Integra Bank Corp. | 2,659 | |||||||||
37 | International Assets Holding Corp.* | 855 | |||||||||
51 | Intervest Bancshares Corp., Class A | 527 | |||||||||
31 | Kansas City Life Insurance Co. | 1,550 | |||||||||
49 | K-Fed Bancorp | 546 | |||||||||
202 | Lakeland Bancorp, Inc. | 3,129 | |||||||||
109 | Lakeland Financial Corp. | 2,539 | |||||||||
81 | Legacy Bancorp, Inc. | 1,112 | |||||||||
53 | Life Partners Holdings, Inc. | 884 | |||||||||
150 | Macatawa Bank Corp. | 1,706 | |||||||||
163 | MainSource Financial Group, Inc. | 2,414 | |||||||||
278 | MarketAxess Holdings, Inc.* | 2,444 | |||||||||
107 | Marlin Business Services Corp.* | 696 | |||||||||
37 | MASSBANK Corp. | 1,459 | |||||||||
141 | MBT Financial Corp. | 1,321 | |||||||||
153 | Medallion Financial Corp. | 1,302 | |||||||||
75 | Mercantile Bank Corp. | 747 | |||||||||
40 | Merchants Bancshares, Inc. | 937 | |||||||||
101 | Meridian Interstate Bancorp, Inc.* | 997 | |||||||||
374 | Meruelo Maddux Properties, Inc.* | 942 | |||||||||
72 | MetroCorp Bancshares, Inc. | 937 | |||||||||
183 | Midwest Banc Holdings, Inc. | 1,881 | |||||||||
227 | Nara Bancorp, Inc. | 2,981 | |||||||||
28 | NASB Financial, Inc. | 797 | |||||||||
50 | National Interstate Corp. | 1,138 | |||||||||
110 | Navigators Group (The), Inc.* | 5,390 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
127 | NewStar Financial, Inc.* | $ | 683 | ||||||||
65 | North Valley Bancorp | 622 | |||||||||
55 | Northrim BanCorp, Inc. | 1,029 | |||||||||
81 | OceanFirst Financial Corp. | 1,525 | |||||||||
106 | Old Second Bancorp, Inc. | 2,600 | |||||||||
169 | Origen Financial, Inc. | 380 | |||||||||
142 | Oritani Financial Corp.* | 2,154 | |||||||||
61 | PAB Bankshares, Inc. | 814 | |||||||||
104 | Pacific Continental Corp. | 1,440 | |||||||||
92 | Pacific Mercantile Bancorp | 831 | |||||||||
41 | Pennsylvania Commerce Bancorp, Inc.* | 1,098 | |||||||||
177 | Penson Worldwide, Inc.* | 1,926 | |||||||||
91 | Peoples Bancorp, Inc. | 2,209 | |||||||||
123 | Pico Holdings, Inc.* | 4,344 | |||||||||
195 | Pinnacle Financial Partners, Inc.* | 5,285 | |||||||||
211 | PMA Capital Corp., Class A* | 1,958 | |||||||||
67 | Preferred Bank | 785 | |||||||||
196 | Premierwest Bancorp | 1,813 | |||||||||
193 | Presidential Life Corp. | 3,273 | |||||||||
117 | Procentury Corp. | 2,121 | |||||||||
54 | Provident Financial Holdings, Inc. | 705 | |||||||||
351 | Provident New York Bancorp | 4,689 | |||||||||
50 | Prudential Bancorp, Inc. of Pennsylvania | 604 | |||||||||
66 | Pulaski Financial Corp. | 835 | |||||||||
50 | QC Holdings, Inc. | 439 | |||||||||
612 | Quanta Capital Holdings Ltd. (Bermuda) | 1,059 | |||||||||
179 | RAM Holdings Ltd. (Bermuda)* | 308 | |||||||||
182 | Renasant Corp. | 4,217 | |||||||||
158 | Republic Bancorp, Inc., Class A | 3,655 | |||||||||
154 | Resource America, Inc., Class A | 1,341 | |||||||||
96 | Riverview Bancorp, Inc. | 855 | |||||||||
85 | Rockville Financial, Inc. | 1,153 | |||||||||
278 | Roma Financial Corp. | 4,315 | |||||||||
48 | Royal Bancshares of Pennsylvania, Class A | 521 | |||||||||
164 | Sanders Morris Harris Group, Inc. | 1,350 | |||||||||
144 | Sandy Spring Bancorp, Inc. | 3,672 | |||||||||
89 | SCBT Financial Corp. | 3,023 | |||||||||
182 | SeaBright Insurance Holdings, Inc.* | 2,825 | |||||||||
167 | Seacoast Banking Corp. of Florida | 1,755 | |||||||||
165 | Security Bank Corp. | 1,267 | |||||||||
66 | Severn Bancorp, Inc. | 578 | |||||||||
73 | Shore Bancshares, Inc. | 1,661 | |||||||||
53 | SI Financial Group, Inc. | 522 | |||||||||
63 | Sierra Bancorp | 1,361 | |||||||||
100 | Silver State Bancorp* | 394 | |||||||||
122 | Simmons First National Corp., Class A | 3,905 | |||||||||
86 | Smithtown Bancorp, Inc. | 1,732 | |||||||||
154 | Southern Community Financial Corp. | 1,146 | |||||||||
120 | Southside Bancshares, Inc. | 2,896 | |||||||||
124 | Southwest Bancorp, Inc. | 2,182 | |||||||||
122 | State Bancorp, Inc. | 1,586 | |||||||||
196 | StellarOne Corp. | 3,158 |
See Notes to Financial Statements.
61
Schedule of Investments (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
66 | Stratus Properties, Inc.* | $ | 1,842 | ||||||||
86 | Suffolk Bancorp | 2,785 | |||||||||
149 | Sun Bancorp, Inc.* | 1,727 | |||||||||
88 | Superior Bancorp* | 1,566 | |||||||||
121 | SY Bancorp, Inc. | 2,980 | |||||||||
47 | Taylor Capital Group, Inc. | 701 | |||||||||
89 | Temecula Valley Bancorp, Inc. | 654 | |||||||||
230 | Texas Capital Bancshares, Inc.* | 4,244 | |||||||||
208 | Thomas Properties Group, Inc. | 1,733 | |||||||||
286 | Thomas Weisel Partners Group, Inc.* | 1,885 | |||||||||
112 | TIB Financial Corp. | 812 | |||||||||
158 | TierOne Corp. | 1,416 | |||||||||
202 | Tower Group, Inc. | 4,745 | |||||||||
195 | TradeStation Group, Inc.* | 1,819 | |||||||||
65 | Triad Guaranty, Inc.* | 148 | |||||||||
139 | Trico Bancshares | 2,364 | |||||||||
117 | Union Bankshares Corp. | 2,242 | |||||||||
197 | United America Indemnity Ltd., Class A* | 3,046 | |||||||||
264 | United Community Financial Corp. | 2,167 | |||||||||
155 | United Financial Bancorp, Inc. | 1,851 | |||||||||
78 | United Security Bancshares | 1,112 | |||||||||
113 | Univest Corp. of Pennsylvania | 2,895 | |||||||||
115 | US Global Investors, Inc., Class A | 1,492 | |||||||||
131 | Vestin Realty Mortgage II, Inc. | 1,114 | |||||||||
113 | ViewPoint Financial Group | 1,836 | |||||||||
88 | Vineyard National Bancorp | 502 | |||||||||
229 | Virginia Commerce Bancorp* | 1,614 | |||||||||
83 | Washington Banking Co. | 1,307 | |||||||||
117 | Washington Trust Bancorp, Inc. | 2,829 | |||||||||
110 | Wauwatosa Holdings, Inc.* | 1,341 | |||||||||
236 | WesBanco, Inc. | 5,076 | |||||||||
153 | West Bancorporation, Inc. | 1,908 | |||||||||
137 | West Coast Bancorp | 1,769 | |||||||||
279 | Westfield Financial, Inc. | 2,712 | |||||||||
136 | Willow Financial Bancorp, Inc. | 1,016 | |||||||||
191 | Wilshire Bancorp, Inc. | 1,574 | |||||||||
148 | World Acceptance Corp.* | 5,828 | |||||||||
54 | WSFS Financial Corp. | 2,744 | |||||||||
82 | ZipRealty, Inc.* | 410 | |||||||||
436,544 | |||||||||||
Health Care—19.5% | |||||||||||
1,162 | Aastrom Biosciences, Inc.* | 465 | |||||||||
190 | Abaxis, Inc.* | 4,841 | |||||||||
286 | Abiomed, Inc.* | 4,173 | |||||||||
323 | Acadia Pharmaceuticals, Inc.* | 2,584 | |||||||||
232 | Accelrys, Inc.* | 1,306 | |||||||||
279 | Acorda Therapeutics, Inc.* | 5,873 | |||||||||
402 | Adolor Corp.* | 1,962 | |||||||||
40 | Affymax, Inc.* | 618 | |||||||||
106 | Air Methods Corp.* | 4,251 | |||||||||
570 | Akorn, Inc.* | 2,565 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
216 | Albany Molecular Research, Inc.* | $ | 2,510 | ||||||||
203 | Alexza Pharmaceuticals, Inc.* | 1,346 | |||||||||
295 | Allied Healthcare International, Inc.* | 443 | |||||||||
142 | Allion Healthcare, Inc.* | 673 | |||||||||
439 | Allos Therapeutics, Inc.* | 2,476 | |||||||||
310 | Alphatec Holdings, Inc.* | 1,497 | |||||||||
201 | Altus Pharmaceuticals, Inc.* | 828 | |||||||||
147 | AMAG Pharmaceuticals, Inc.* | 6,031 | |||||||||
56 | American Dental Partners, Inc.* | 650 | |||||||||
392 | AMICAS, Inc.* | 804 | |||||||||
58 | Amicus Therapeutics, Inc.* | 611 | |||||||||
209 | AngioDynamics, Inc.* | 3,089 | |||||||||
741 | Angiotech Pharmaceuticals, Inc. (Canada)* | 2,290 | |||||||||
106 | Animal Health International, Inc.* | 932 | |||||||||
312 | Antigenics, Inc.* | 705 | |||||||||
631 | Arena Pharmaceuticals, Inc.* | 3,527 | |||||||||
601 | Ariad Pharmaceuticals, Inc.* | 1,779 | |||||||||
382 | Arqule, Inc.* | 1,471 | |||||||||
411 | Array Biopharma, Inc.* | 2,556 | |||||||||
149 | Aspect Medical Systems, Inc.* | 995 | |||||||||
184 | AspenBio Pharma, Inc.* | 782 | |||||||||
124 | AtriCure, Inc.* | 1,657 | |||||||||
17 | Atrion Corp. | 1,902 | |||||||||
564 | AVI BioPharma, Inc.* | 846 | |||||||||
230 | Barrier Therapeutics, Inc.* | 527 | |||||||||
427 | BELLUS Health, Inc. (Canada)* | 803 | |||||||||
258 | BMP Sunstone Corp. (China)* | 1,829 | |||||||||
331 | BioCryst Pharmaceuticals, Inc.* | 1,211 | |||||||||
155 | Biodel, Inc.* | 2,145 | |||||||||
120 | BioMimetic Therapeutics, Inc.* | 1,178 | |||||||||
121 | Bio-Reference Labs, Inc.* | 3,047 | |||||||||
330 | BioScrip, Inc.* | 1,815 | |||||||||
568 | Bruker Corp.* | 6,884 | |||||||||
76 | Cadence Pharmaceuticals, Inc.* | 499 | |||||||||
418 | Caliper Life Sciences, Inc.* | 1,526 | |||||||||
202 | Candela Corp.* | 600 | |||||||||
199 | Cardiac Science Corp.* | 1,797 | |||||||||
555 | Cardiome Pharma Corp. (Canada)* | 4,829 | |||||||||
683 | Cell Genesys, Inc.* | 2,623 | |||||||||
437 | Cell Therapeutics, Inc.* | 341 | |||||||||
277 | Cerus Corp.* | 1,726 | |||||||||
177 | China Medical Technologies, Inc. ADR (Cayman Islands) | 6,620 | |||||||||
10 | Chindex International, Inc.* | 245 | |||||||||
185 | Clinical Data, Inc.* | 2,853 | |||||||||
449 | Columbia Laboratories, Inc.* | 1,123 | |||||||||
305 | Combinatorx, Inc.* | 1,089 | |||||||||
47 | Computer Programs & Systems, Inc. | 894 | |||||||||
256 | Conceptus, Inc.* | 4,613 | |||||||||
90 | Corvel Corp.* | 2,961 | |||||||||
279 | Cross Country Healthcare, Inc.* | 3,337 | |||||||||
97 | Crucell N.V. ADR (Netherlands)* | 1,807 |
See Notes to Financial Statements.
62
Schedule of Investments (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
56 | Cutera, Inc.* | $ | 745 | ||||||||
519 | CV Therapeutics, Inc.* | 4,749 | |||||||||
179 | Cyberonics, Inc.* | 2,828 | |||||||||
74 | Cynosure, Inc., Class A* | 1,925 | |||||||||
324 | Cypress Bioscience, Inc.* | 2,132 | |||||||||
323 | Cytokinetics, Inc.* | 1,114 | |||||||||
790 | CytRx Corp.* | 672 | |||||||||
101 | Datascope Corp. | 3,783 | |||||||||
538 | deCODE Genetics, Inc.* | 829 | |||||||||
740 | Dendreon Corp.* | 3,900 | |||||||||
415 | Depomed, Inc.* | 1,357 | |||||||||
184 | DexCom, Inc.* | 1,417 | |||||||||
845 | Discovery Laboratories, Inc.* | 2,425 | |||||||||
368 | Draxis Health, Inc. (Canada)* | 2,179 | |||||||||
648 | Durect Corp.* | 2,942 | |||||||||
528 | Dyax Corp.* | 2,117 | |||||||||
348 | Dynavax Technologies Corp.* | 679 | |||||||||
187 | Emageon, Inc.* | 410 | |||||||||
373 | Endologix, Inc.* | 1,007 | |||||||||
383 | Enzon Pharmaceuticals, Inc.* | 3,340 | |||||||||
443 | eResearchTechnology, Inc.* | 5,396 | |||||||||
76 | Eurand N.V. (Netherlands)* | 1,212 | |||||||||
76 | Exactech, Inc.* | 1,863 | |||||||||
208 | Flamel Technologies ADR (France)* | 1,930 | |||||||||
963 | Generex Biotechnology Corp.* | 1,030 | |||||||||
368 | Genitope Corp.* | 52 | |||||||||
185 | Genomic Health, Inc.* | 3,981 | |||||||||
106 | Genoptix, Inc.* | 2,908 | |||||||||
244 | Gentiva Health Services, Inc.* | 5,305 | |||||||||
695 | Geron Corp.* | 3,280 | |||||||||
127 | GTx, Inc.* | 2,165 | |||||||||
95 | Hansen Medical, Inc.* | 1,658 | |||||||||
132 | Health Grades, Inc.* | 734 | |||||||||
310 | HealthTronics, Inc.* | 1,110 | |||||||||
55 | Helicos BioSciences Corp.* | 327 | |||||||||
74 | Hi-Tech Pharmacal Co., Inc.* | 648 | |||||||||
213 | HMS Holdings Corp.* | 5,489 | |||||||||
63 | Home Diagnostics, Inc.* | 491 | |||||||||
357 | Hythiam, Inc.* | 967 | |||||||||
91 | ICU Medical, Inc.* | 2,286 | |||||||||
196 | Idenix Pharmaceuticals, Inc.* | 1,270 | |||||||||
217 | I-Flow Corp.* | 2,897 | |||||||||
370 | Immunogen, Inc.* | 1,191 | |||||||||
730 | Incyte Corp.* | 7,920 | |||||||||
667 | Indevus Pharmaceuticals, Inc.* | 3,208 | |||||||||
170 | Infinity Pharmaceuticals, Inc.* | 1,158 | |||||||||
494 | Inspire Pharmaceuticals, Inc.* | 1,694 | |||||||||
173 | Insulet Corp.* | 3,168 | |||||||||
341 | InterMune, Inc.* | 5,405 | |||||||||
286 | Introgen Therapeutics, Inc.* | 858 | |||||||||
97 | IPC The Hospitalist Co., Inc.* | 2,277 | |||||||||
162 | IRIS International, Inc.* | 2,210 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
288 | ISTA Pharmaceuticals, Inc.* | $ | 625 | ||||||||
64 | Jazz Pharmaceuticals, Inc.* | 577 | |||||||||
128 | Kendle International, Inc.* | 5,464 | |||||||||
104 | Kensey Nash Corp.* | 3,033 | |||||||||
377 | Keryx Biopharmaceuticals, Inc.* | 196 | |||||||||
279 | Kosan Biosciences, Inc.* | 463 | |||||||||
162 | LCA-Vision, Inc. | 1,638 | |||||||||
898 | Lexicon Pharmaceuticals, Inc.* | 1,850 | |||||||||
118 | LHC Group, Inc.* | 1,841 | |||||||||
835 | Ligand Pharmaceuticals, Inc., Class B* | 3,382 | |||||||||
320 | Luminex Corp.* | 6,243 | |||||||||
442 | MannKind Corp.* | 1,149 | |||||||||
89 | MAP Pharmaceuticals, Inc.* | 1,189 | |||||||||
181 | Marshall Edwards, Inc.* | 556 | |||||||||
186 | Matria Healthcare, Inc.* | 4,743 | |||||||||
86 | Matrixx Initiatives, Inc.* | 1,196 | |||||||||
241 | Maxygen, Inc.* | 1,429 | |||||||||
138 | MedCath Corp.* | 2,561 | |||||||||
140 | Medical Action Industries, Inc.* | 2,295 | |||||||||
189 | Medivation, Inc.* | 2,892 | |||||||||
239 | Merit Medical Systems, Inc.* | 3,516 | |||||||||
98 | Metabolix, Inc.* | 1,079 | |||||||||
136 | Micrus Endovascular Corp.* | 1,548 | |||||||||
109 | Molecular Insight Pharmaceuticals, Inc.* | 853 | |||||||||
237 | Momenta Pharmaceuticals, Inc.* | 3,313 | |||||||||
1,153 | Monogram Biosciences, Inc.* | 1,268 | |||||||||
105 | MWI Veterinary Supply, Inc.* | 3,619 | |||||||||
531 | Nabi Biopharmaceuticals* | 2,140 | |||||||||
146 | Nanosphere, Inc.* | 972 | |||||||||
225 | Nastech Pharmaceutical Co., Inc.* | 308 | |||||||||
189 | Natus Medical, Inc.* | 3,718 | |||||||||
124 | Neogen Corp.* | 3,116 | |||||||||
330 | Neurocrine Biosciences, Inc.* | 1,792 | |||||||||
183 | Neurogen Corp.* | 179 | |||||||||
90 | Neurometrix, Inc.* | 225 | |||||||||
169 | Northstar Neuroscience, Inc.* | 304 | |||||||||
160 | NovaMed, Inc.* | 670 | |||||||||
538 | Novavax, Inc.* | 1,275 | |||||||||
215 | Noven Pharmaceuticals, Inc.* | 1,957 | |||||||||
407 | NPS Pharmaceuticals, Inc.* | 1,534 | |||||||||
463 | Nuvelo, Inc.* | 426 | |||||||||
240 | NxStage Medical, Inc.* | 1,387 | |||||||||
76 | Obagi Medical Products, Inc.* | 609 | |||||||||
215 | Odyssey HealthCare, Inc.* | 1,967 | |||||||||
302 | Omnicell, Inc.* | 3,630 | |||||||||
110 | Omrix Biopharmaceuticals, Inc.* | 1,634 | |||||||||
244 | Optimer Pharmaceuticals, Inc.* | 1,608 | |||||||||
408 | OraSure Technologies, Inc.* | 2,636 | |||||||||
223 | Orexigen Therapeutics, Inc.* | 2,368 | |||||||||
657 | Orthovita, Inc.* | 1,505 | |||||||||
51 | Osiris Therapeutics, Inc.* | 590 | |||||||||
386 | Pain Therapeutics, Inc.* | 2,679 |
See Notes to Financial Statements.
63
Schedule of Investments (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
120 | Palomar Medical Technologies, Inc.* | $ | 1,692 | ||||||||
349 | Panacos Pharmaceuticals, Inc.* | 164 | |||||||||
92 | PDI, Inc.* | 793 | |||||||||
203 | Penwest Pharmaceuticals Co.* | 607 | |||||||||
1,979 | Peregrine Pharmaceuticals, Inc.* | 827 | |||||||||
165 | PharmaNet Development Group, Inc.* | 3,937 | |||||||||
93 | Pharmasset, Inc.* | 1,442 | |||||||||
112 | Power Medical Interventions, Inc.* | 718 | |||||||||
258 | Pozen, Inc.* | 3,413 | |||||||||
260 | Progenics Pharmaceuticals, Inc.* | 3,502 | |||||||||
103 | Providence Service (The) Corp.* | 2,898 | |||||||||
658 | QLT, Inc. (Canada)* | 2,448 | |||||||||
284 | Quidel Corp.* | 4,547 | |||||||||
303 | RadNet, Inc.* | 2,121 | |||||||||
259 | Renovis, Inc. (Germany)* | 585 | |||||||||
71 | Replidyne, Inc.* | 99 | |||||||||
191 | Res-Care, Inc.* | 3,111 | |||||||||
307 | Rigel Pharmaceuticals, Inc.* | 6,907 | |||||||||
468 | RTI Biologics, Inc.* | 4,746 | |||||||||
29 | RXi Pharmaceuticals Corp.* | 203 | |||||||||
415 | Salix Pharmaceuticals Ltd.* | 2,913 | |||||||||
351 | Sangamo Biosciences, Inc.* | 4,475 | |||||||||
449 | Santarus, Inc.* | 1,203 | |||||||||
463 | Savient Pharmaceuticals, Inc.* | 10,111 | |||||||||
401 | Sciclone Pharmaceuticals, Inc.* | 726 | |||||||||
678 | Seattle Genetics, Inc.* | 6,887 | |||||||||
199 | Senomyx, Inc.* | 1,194 | |||||||||
388 | Sequenom, Inc.* | 2,452 | |||||||||
57 | Shamir Optical Industry Ltd. (Israel) | 416 | |||||||||
75 | Sirtris Pharmaceuticals, Inc.* | 1,676 | |||||||||
118 | Somanetics Corp.* | 1,922 | |||||||||
48 | Somaxon Pharmaceuticals, Inc.* | 221 | |||||||||
234 | Sonic Innovations, Inc.* | 1,002 | |||||||||
145 | SonoSite, Inc.* | 4,624 | |||||||||
274 | Spectranetics Corp.* | 2,948 | |||||||||
701 | StemCells, Inc.* | 1,059 | |||||||||
322 | Stereotaxis, Inc.* | 2,193 | |||||||||
41 | Sucampo Pharmaceuticals, Inc., Class A* | 587 | |||||||||
375 | Sun Healthcare Group, Inc.* | 4,931 | |||||||||
502 | SuperGen, Inc.* | 1,411 | |||||||||
182 | SXC Health Solutions Corp. (Canada)* | 2,828 | |||||||||
243 | Syneron Medical Ltd. (Israel)* | 3,674 | |||||||||
108 | Synovis Life Technologies, Inc.* | 1,821 | |||||||||
222 | Synta Pharmaceuticals Corp.* | 1,490 | |||||||||
160 | Targacept, Inc.* | 1,187 | |||||||||
138 | Targanta Therapeutics Corp.* | 1,078 | |||||||||
455 | Telik, Inc.* | 960 | |||||||||
225 | Tercica, Inc.* | 1,118 | |||||||||
487 | ThermoGenesis Corp.* | 794 | |||||||||
382 | Third Wave Technologies, Inc.* | 3,369 | |||||||||
435 | TLC Vision Corp. (Canada)* | 653 | |||||||||
130 | TranS1, Inc.* | 1,697 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
201 | Transition Therapeutics, Inc. (Canada)* | $ | 2,392 | ||||||||
194 | Trimeris, Inc.* | 1,356 | |||||||||
282 | TriZetto Group (The), Inc.* | 5,936 | |||||||||
47 | Trubion Pharmaceuticals, Inc.* | 331 | |||||||||
104 | US Physical Therapy, Inc.* | 1,620 | |||||||||
232 | Vanda Pharmaceuticals, Inc.* | 819 | |||||||||
342 | Vical, Inc.* | 1,204 | |||||||||
57 | Virtual Radiologic Corp.* | 796 | |||||||||
149 | Vital Images, Inc.* | 2,250 | |||||||||
46 | Vital Signs, Inc. | 2,407 | |||||||||
510 | Vivus, Inc.* | 2,892 | |||||||||
137 | Vnus Medical Technologies, Inc.* | 2,240 | |||||||||
307 | Volcano Corp.* | 3,632 | |||||||||
1,152 | XOMA Ltd.* | 2,788 | |||||||||
60 | Xtent, Inc.* | 212 | |||||||||
53 | Young Innovations, Inc. | 944 | |||||||||
181 | Zoll Medical Corp.* | 6,042 | |||||||||
498,586 | |||||||||||
Industrials—14.4% | |||||||||||
194 | 3D Systems Corp.* | 2,947 | |||||||||
122 | AAON, Inc. | 2,206 | |||||||||
511 | ABX Holdings, Inc.* | 1,369 | |||||||||
211 | Aceto Corp. | 1,483 | |||||||||
528 | Active Power, Inc.* | 718 | |||||||||
70 | Aerovironment, Inc.* | 1,674 | |||||||||
232 | Altra Holdings, Inc.* | 3,533 | |||||||||
119 | American Ecology Corp. | 3,163 | |||||||||
93 | American Railcar Industries, Inc. | 1,918 | |||||||||
80 | American Science & Engineering, Inc. | 3,898 | |||||||||
360 | American Superconductor Corp.* | 9,100 | |||||||||
95 | American Woodmark Corp. | 1,793 | |||||||||
255 | Apogee Enterprises, Inc. | 5,689 | |||||||||
518 | Applied Energetics, Inc.* | 1,109 | |||||||||
108 | Applied Signal Technology, Inc. | 1,236 | |||||||||
144 | Argon ST, Inc.* | 2,651 | |||||||||
124 | Aries Maritime Transport Ltd. (Bermuda) | 682 | |||||||||
194 | Astec Industries, Inc.* | 7,110 | |||||||||
59 | Astronics Corp.* | 1,050 | |||||||||
71 | Axsys Technologies, Inc.* | 3,873 | |||||||||
74 | Barrett Business Services, Inc. | 888 | |||||||||
387 | Beacon Roofing Supply, Inc.* | 4,122 | |||||||||
124 | Builders FirstSource, Inc.* | 817 | |||||||||
72 | Canadian Solar, Inc. (China)* | 1,971 | |||||||||
1,262 | Capstone Turbine Corp.* | 3,521 | |||||||||
160 | Casella Waste Systems, Inc., Class A* | 1,706 | |||||||||
191 | Celadon Group, Inc.* | 1,965 | |||||||||
246 | Chart Industries, Inc.* | 9,996 | |||||||||
349 | China BAK Battery, Inc.* | 1,298 | |||||||||
69 | China Fire & Security Group, Inc.* | 587 | |||||||||
110 | Coleman Cable, Inc.* | 1,326 | |||||||||
166 | Columbus McKinnon Corp.* | 4,699 |
See Notes to Financial Statements.
64
Schedule of Investments (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
187 | Commercial Vehicle Group, Inc.* | $ | 2,253 | ||||||||
71 | COMSYS IT Partners, Inc.* | 581 | |||||||||
109 | Courier Corp. | 2,566 | |||||||||
96 | CRA International, Inc.* | 3,310 | |||||||||
99 | Deswell Industries, Inc. (Hong Kong) | 639 | |||||||||
262 | Diamond Management & Technology Consultants, Inc. | 1,611 | |||||||||
89 | Dynamex, Inc.* | 2,237 | |||||||||
106 | Dynamic Materials Corp. | 4,985 | |||||||||
170 | Electro Rent Corp. | 2,297 | |||||||||
202 | Encore Wire Corp. | 4,565 | |||||||||
83 | EnerNOC, Inc.* | 1,280 | |||||||||
198 | Euroseas Ltd. | 2,728 | |||||||||
127 | Exponent, Inc.* | 4,285 | |||||||||
74 | First Advantage Corp., Class A* | 1,518 | |||||||||
170 | Flanders Corp.* | 1,047 | |||||||||
333 | Flow International Corp.* | 3,340 | |||||||||
103 | FreightCar America, Inc. | 3,955 | |||||||||
320 | Frontier Airlines Holdings, Inc.* | 133 | |||||||||
111 | Frozen Food Express Industries | 846 | |||||||||
146 | Fuel Tech, Inc.* | 3,752 | |||||||||
595 | FuelCell Energy, Inc.* | 5,254 | |||||||||
78 | Fushi Copperweld, Inc.* | 1,261 | |||||||||
106 | Gehl Co.* | 1,636 | |||||||||
153 | GeoEye, Inc.* | 3,524 | |||||||||
195 | Gibraltar Industries, Inc. | 2,038 | |||||||||
384 | Great Lakes Dredge & Dock Corp. | 2,296 | |||||||||
157 | Grupo Aeroportuario del Centro Norte Sab de CV ADR (Mexico) | 3,415 | |||||||||
62 | Harbin Electric, Inc.* | 989 | |||||||||
100 | Hardinge, Inc. | 1,668 | |||||||||
376 | Healthcare Services Group | 5,738 | |||||||||
120 | Herley Industries, Inc.* | 1,463 | |||||||||
171 | Houston Wire & Cable Co. | 3,199 | |||||||||
218 | Hudson Highland Group, Inc.* | 1,934 | |||||||||
55 | Hurco Cos, Inc.* | 2,518 | |||||||||
601 | Hydrogenics Corp. (Canada)* | 343 | |||||||||
50 | ICF International, Inc.* | 892 | |||||||||
103 | ICT Group, Inc.* | 1,126 | |||||||||
110 | Innovative Solutions & Support, Inc.* | 1,018 | |||||||||
240 | Insituform Technologies, Inc., Class A* | 4,061 | |||||||||
153 | Insteel Industries, Inc. | 1,906 | |||||||||
135 | Integrated Electrical Services, Inc.* | 2,259 | |||||||||
468 | Interface, Inc., Class A | 6,009 | |||||||||
79 | Intersections, Inc.* | 707 | |||||||||
215 | Kaman Corp. | 5,827 | |||||||||
166 | Kenexa Corp.* | 2,903 | |||||||||
363 | Kforce, Inc.* | 2,987 | |||||||||
220 | Kimball International, Inc., Class B | 2,259 | |||||||||
24 | K-Tron International, Inc.* | 3,288 | |||||||||
127 | Ladish Co., Inc.* | 3,818 | |||||||||
56 | Lawson Products, Inc. | 1,421 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
93 | LB Foster Co., Class A* | $ | 2,985 | ||||||||
108 | Learning Tree International, Inc.* | 1,926 | |||||||||
221 | LECG Corp.* | 2,296 | |||||||||
75 | LMI Aerospace, Inc.* | 1,440 | |||||||||
188 | LSI Industries, Inc. | 2,060 | |||||||||
143 | Marten Transport Ltd.* | 2,331 | |||||||||
229 | Medis Technologies Ltd.* | 1,921 | |||||||||
235 | Mesa Air Group, Inc.* | 155 | |||||||||
496 | Microvision, Inc.* | 1,557 | |||||||||
5 | Mitsui & Co. Ltd. ADR (Japan) | 2,348 | |||||||||
100 | MTC Technologies, Inc.* | 2,386 | |||||||||
67 | Multi-Color Corp. | 1,374 | |||||||||
107 | NN, Inc. | 1,074 | |||||||||
78 | Northwest Pipe Co.* | 3,317 | |||||||||
129 | Nuco2, Inc.* | 3,568 | |||||||||
108 | OceanFreight, Inc. (Scotland) | 2,445 | |||||||||
414 | Odyssey Marine Exploration, Inc.* | 2,000 | |||||||||
27 | Omega Flex, Inc. | 399 | |||||||||
105 | Omega Navigation Enterprises, Inc., Class A (Scotland) | 1,899 | |||||||||
310 | On Assignment, Inc.* | 2,179 | |||||||||
232 | Orion Energy Systems, Inc.* | 2,594 | |||||||||
189 | Orion Marine Group, Inc.* | 2,584 | |||||||||
227 | Pacer International, Inc. | 4,213 | |||||||||
27 | PAM Transportation Services, Inc.* | 384 | |||||||||
157 | Paragon Shipping, Inc., Class A | 2,699 | |||||||||
74 | Park-Ohio Holdings Corp.* | 1,234 | |||||||||
13 | Patriot Transportation Holding, Inc.* | 1,058 | |||||||||
57 | Peerless Manufacturing Co.* | 2,181 | |||||||||
199 | PeopleSupport, Inc.* | 1,968 | |||||||||
96 | PGT, Inc.* | 306 | |||||||||
179 | Pinnacle Airlines Corp.* | 1,489 | |||||||||
766 | Plug Power, Inc.* | 2,474 | |||||||||
74 | Powell Industries, Inc.* | 3,113 | |||||||||
764 | Power-One, Inc.* | 2,284 | |||||||||
147 | PowerSecure International, Inc.* | 1,788 | |||||||||
23 | Preformed Line Products Co. | 1,134 | |||||||||
66 | Protection One, Inc.* | 680 | |||||||||
85 | Quality Distribution, Inc.* | 289 | |||||||||
79 | Quixote Corp. | 934 | |||||||||
158 | Raven Industries, Inc. | 4,841 | |||||||||
188 | RBC Bearings, Inc.* | 7,514 | |||||||||
271 | Republic Airways Holdings, Inc.* | 4,569 | |||||||||
170 | Rush Enterprises, Inc., Class A* | 2,740 | |||||||||
80 | Rush Enterprises, Inc., Class B* | 1,202 | |||||||||
117 | Saia, Inc.* | 1,616 | |||||||||
105 | Solarfun Power Holdings Co. Ltd. ADR (China)* | 1,410 | |||||||||
81 | Standard Parking Corp.* | 1,736 | |||||||||
112 | Sterling Construction Co., Inc.* | 2,249 | |||||||||
107 | Sun Hydraulics Corp. | 3,229 | |||||||||
179 | Superior Essex, Inc.* | 5,322 |
See Notes to Financial Statements.
65
Schedule of Investments (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
67 | Sypris Solutions, Inc. | $ | 281 | ||||||||
551 | Taser International, Inc.* | 4,110 | |||||||||
94 | TBS International Ltd., Class A (Bermuda)* | 3,777 | |||||||||
160 | Team, Inc.* | 4,757 | |||||||||
117 | Tecumseh Products Co., Class A* | 3,666 | |||||||||
33 | Tecumseh Products Co., Class B* | 907 | |||||||||
193 | TurboChef Technologies, Inc.* | 1,671 | |||||||||
99 | Twin Disc, Inc. | 1,785 | |||||||||
142 | Ultralife Batteries, Inc.* | 1,463 | |||||||||
220 | Ultrapetrol Bahamas Ltd.* | 2,114 | |||||||||
125 | Universal Forest Products, Inc. | 4,339 | |||||||||
141 | Universal Truckload Services, Inc.* | 2,957 | |||||||||
68 | USA Truck, Inc.* | 830 | |||||||||
746 | Valence Technology, Inc.* | 2,447 | |||||||||
195 | Vicor Corp. | 2,352 | |||||||||
118 | Vitran Corp, Inc. (Canada)* | 1,691 | |||||||||
33 | VSE Corp. | 1,103 | |||||||||
49 | Waste Industries USA, Inc. | 1,850 | |||||||||
302 | Waste Services, Inc.* | 2,359 | |||||||||
369,736 | |||||||||||
Information Technology—25.9% | |||||||||||
262 | Acacia Research - Acacia Technologies* | 1,394 | |||||||||
168 | Access Integrated Technologies, Inc., Class A* | 497 | |||||||||
232 | Actel Corp.* | 3,823 | |||||||||
277 | Actions Semiconductor Co. Ltd. ADR (Cayman Islands)* | 1,069 | |||||||||
399 | ActivIdentity Corp.* | 922 | |||||||||
533 | Actuate Corp.* | 2,169 | |||||||||
1,060 | Adaptec, Inc.* | 2,957 | |||||||||
296 | Advanced Energy Industries, Inc.* | 4,144 | |||||||||
390 | Advanced Analogic Technologies, Inc.* | 2,699 | |||||||||
231 | Agilysys, Inc. | 2,532 | |||||||||
278 | Airvana, Inc.* | 1,796 | |||||||||
96 | Aladdin Knowledge Systems Ltd. (Israel)* | 1,397 | |||||||||
520 | Alvarion Ltd. (Israel)* | 3,390 | |||||||||
529 | Anadigics, Inc.* | 5,904 | |||||||||
129 | Anaren, Inc.* | 1,738 | |||||||||
153 | Ansoft Corp.* | 5,073 | |||||||||
556 | ARM Holdings PLC ADR (United Kingdom) | 3,319 | |||||||||
1,129 | Art Technology Group, Inc.* | 4,042 | |||||||||
393 | AsiaInfo Holdings, Inc.* | 4,783 | |||||||||
81 | ASM International N.V. (Netherlands) | 1,883 | |||||||||
433 | Asyst Technologies, Inc.* | 1,550 | |||||||||
349 | AudioCodes Ltd. (Israel)* | 1,424 | |||||||||
71 | AuthenTec, Inc.* | 952 | |||||||||
380 | Autobytel, Inc.* | 722 | |||||||||
1,997 | Avanex Corp.* | 1,717 | |||||||||
207 | Aware, Inc.* | 662 | |||||||||
889 | Axcelis Technologies, Inc.* | 4,801 | |||||||||
124 | Bankrate, Inc.* | 6,478 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
22 | Bel Fuse, Inc., Class A | $ | 623 | ||||||||
81 | Bel Fuse, Inc., Class B | 2,112 | |||||||||
104 | Bidz.com, Inc.* | 1,067 | |||||||||
106 | BigBand Networks, Inc.* | 780 | |||||||||
172 | BluePhoenix Solutions Ltd. (Israel)* | 1,471 | |||||||||
874 | Bookham, Inc.* | 1,486 | |||||||||
637 | Borland Software Corp.* | 1,127 | |||||||||
162 | Bottomline Technologies, Inc.* | 1,725 | |||||||||
202 | California Micro Devices Corp.* | 620 | |||||||||
194 | Callidus Software, Inc.* | 1,013 | |||||||||
233 | Captaris, Inc.* | 1,125 | |||||||||
84 | Cascade Microtech, Inc.* | 627 | |||||||||
60 | Cass Information Systems, Inc. | 2,023 | |||||||||
87 | Catapult Communications Corp.* | 628 | |||||||||
323 | Ceragon Networks Ltd. (Israel)* | 2,636 | |||||||||
171 | Ceva, Inc.* | 1,672 | |||||||||
135 | China Finance Online Co. Ltd. ADR (China)* | 2,491 | |||||||||
176 | China Techfaith Wireless Communication Technology Ltd. ADR (Cayman Islands)* | 957 | |||||||||
543 | ChipMOS TECHNOLOGIES Bermuda Ltd. (Taiwan, Republic of China)* | 1,607 | |||||||||
291 | Chordiant Software, Inc.* | 1,327 | |||||||||
772 | Cirrus Logic, Inc.* | 5,520 | |||||||||
429 | CMGI, Inc.* | 5,933 | |||||||||
200 | Cohu, Inc. | 3,474 | |||||||||
48 | comScore, Inc.* | 906 | |||||||||
252 | Comtech Group, Inc.* | 3,281 | |||||||||
90 | Comverge, Inc.* | 1,181 | |||||||||
4,292 | Conexant Systems, Inc.* | 2,125 | |||||||||
181 | Constant Contact, Inc.* | 3,231 | |||||||||
349 | Convera Corp., Class A* | 489 | |||||||||
64 | Corel Corp. (Canada)* | 692 | |||||||||
72 | CPI International, Inc.* | 824 | |||||||||
284 | Cray, Inc.* | 1,769 | |||||||||
885 | Credence Systems Corp.* | 920 | |||||||||
112 | CryptoLogic Ltd. (Ireland) | 2,236 | |||||||||
597 | Cybersource Corp.* | 10,836 | |||||||||
151 | Deltek, Inc.* | 1,854 | |||||||||
115 | DemandTec, Inc.* | 889 | |||||||||
222 | Digi International, Inc.* | 1,829 | |||||||||
191 | Digimarc Corp.* | 1,944 | |||||||||
227 | Ditech Networks, Inc.* | 647 | |||||||||
399 | Dot Hill Systems Corp.* | 1,005 | |||||||||
203 | Double-Take Software, Inc.* | 3,021 | |||||||||
284 | DSP Group, Inc.* | 3,729 | |||||||||
154 | DTS, Inc.* | 4,543 | |||||||||
151 | Eagle Test Systems, Inc.* | 1,823 | |||||||||
22 | Ebix, Inc.* | 1,864 | |||||||||
267 | Echelon Corp.* | 3,006 | |||||||||
243 | Electro Scientific Industries, Inc.* | 3,988 | |||||||||
445 | Emcore Corp.* | 2,750 | |||||||||
135 | EMS Technologies, Inc.* | 3,491 |
See Notes to Financial Statements.
66
Schedule of Investments (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
123 | Entorian Technologies, Inc.* | $ | 145 | ||||||||
400 | Entrust, Inc.* | 996 | |||||||||
309 | EPIQ Systems, Inc.* | 4,771 | |||||||||
407 | Exar Corp.* | 3,431 | |||||||||
97 | Excel Technology, Inc.* | 2,288 | |||||||||
283 | Exfo Electro Optical Engineering, Inc. (Canada)* | 1,616 | |||||||||
1,015 | Extreme Networks, Inc.* | 3,075 | |||||||||
335 | FalconStor Software, Inc.* | 2,730 | |||||||||
145 | FARO Technologies, Inc.* | 5,110 | |||||||||
2,687 | Finisar Corp.* | 3,627 | |||||||||
150 | Forrester Research, Inc.* | 4,326 | |||||||||
92 | Fundtech Ltd. (Israel)* | 1,133 | |||||||||
204 | Gevity HR, Inc. | 1,391 | |||||||||
330 | GigaMedia Ltd. (Taiwan, Republic of China)* | 5,135 | |||||||||
175 | Globecomm Systems, Inc.* | 1,554 | |||||||||
76 | Glu Mobile, Inc.* | 356 | |||||||||
205 | Gmarket, Inc. ADR (South Korea)* | 5,228 | |||||||||
173 | Greenfield Online, Inc.* | 1,974 | |||||||||
373 | GSI Group, Inc. (Canada)* | 3,040 | |||||||||
60 | Guidance Software, Inc.* | 611 | |||||||||
375 | Hackett Group (The), Inc.* | 1,493 | |||||||||
816 | Harmonic, Inc.* | 6,748 | |||||||||
221 | Harris Stratex Networks, Inc., Class A* | 2,097 | |||||||||
794 | Himax Technologies, Inc. ADR (Taiwan, Republic of China) | 3,994 | |||||||||
216 | HSW International, Inc.* | 866 | |||||||||
140 | i2 Technologies, Inc.* | 1,470 | |||||||||
96 | ID Systems, Inc.* | 815 | |||||||||
235 | iGate Corp.* | 1,911 | |||||||||
258 | Ikanos Communications, Inc.* | 921 | |||||||||
264 | Immersion Corp.* | 2,981 | |||||||||
273 | Information Services Group, Inc.* | 1,414 | |||||||||
370 | infoUSA, Inc. | 2,098 | |||||||||
82 | Integral Systems, Inc. | 2,828 | |||||||||
233 | Integrated Silicon Solution, Inc.* | 1,370 | |||||||||
197 | Intellon Corp.* | 1,084 | |||||||||
115 | Interactive Intelligence, Inc.* | 1,459 | |||||||||
428 | Internap Network Services Corp.* | 2,059 | |||||||||
263 | Internet Brands, Inc., Class A* | 1,712 | |||||||||
338 | Internet Capital Group, Inc.* | 3,397 | |||||||||
82 | Internet Gold-Golden Lines Ltd. (Israel)* | 845 | |||||||||
96 | Internet Initiative Japan, Inc. ADR (Japan) | 807 | |||||||||
337 | InterVoice, Inc.* | 2,113 | |||||||||
396 | Interwoven, Inc.* | 4,459 | |||||||||
187 | Intevac, Inc.* | 2,483 | |||||||||
545 | Ipass, Inc.* | 1,553 | |||||||||
162 | Isilon Systems, Inc.* | 784 | |||||||||
153 | Ituran Location & Control Ltd. (Israel) | 1,634 | |||||||||
204 | IXYS Corp.* | 1,463 | |||||||||
262 | JDA Software Group, Inc.* | 4,952 | |||||||||
157 | Jupitermedia Corp.* | 306 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
150 | Keynote Systems, Inc.* | $ | 1,733 | ||||||||
275 | Knot (The), Inc.* | 3,229 | |||||||||
188 | KongZhong Corp. ADR (China)* | 795 | |||||||||
594 | Kopin Corp.* | 1,770 | |||||||||
466 | Kulicke & Soffa Industries, Inc.* | 3,071 | |||||||||
131 | KVH Industries, Inc.* | 1,315 | |||||||||
159 | Lanoptics Ltd. (Israel)* | 2,296 | |||||||||
994 | Lattice Semiconductor Corp.* | 3,370 | |||||||||
108 | LeCroy Corp.* | 869 | |||||||||
529 | Lionbridge Technologies, Inc.* | 1,561 | |||||||||
183 | Liquidity Services, Inc.* | 1,491 | |||||||||
413 | LivePerson, Inc.* | 1,392 | |||||||||
162 | LoJack Corp.* | 1,602 | |||||||||
68 | LoopNet, Inc.* | 768 | |||||||||
542 | LTX Corp.* | 1,572 | |||||||||
275 | Magma Design Automation, Inc.* | 2,566 | |||||||||
175 | Mantech International Corp., Class A* | 8,360 | |||||||||
257 | Marchex, Inc., Class B | 2,655 | |||||||||
447 | Mattson Technology, Inc.* | 2,168 | |||||||||
178 | Maxwell Technologies, Inc.* | 1,899 | |||||||||
125 | Measurement Specialties, Inc.* | 2,024 | |||||||||
78 | Mellanox Technologies Ltd. (Israel)* | 1,168 | |||||||||
148 | MEMSIC, Inc.* | 1,174 | |||||||||
198 | Mercury Computer Systems, Inc.* | 1,588 | |||||||||
183 | Merix Corp.* | 349 | |||||||||
469 | Microtune, Inc.* | 1,656 | |||||||||
1,028 | Mindspeed Technologies, Inc.* | 576 | |||||||||
381 | MIPS Technologies, Inc.* | 1,730 | |||||||||
296 | MIVA, Inc.* | 497 | |||||||||
105 | Moldflow Corp.* | 2,075 | |||||||||
216 | Monolithic Power Systems, Inc.* | 4,946 | |||||||||
120 | Monotype Imaging Holdings, Inc.* | 1,758 | |||||||||
286 | MoSys, Inc.* | 1,313 | |||||||||
1,356 | Move, Inc.* | 4,271 | |||||||||
1,385 | MRV Communications, Inc.* | 2,174 | |||||||||
86 | Multi-Fineline Electronix, Inc.* | 1,625 | |||||||||
123 | Nanometrics, Inc.* | 870 | |||||||||
125 | Napco Security Systems, Inc.* | 590 | |||||||||
406 | Napster, Inc.* | 609 | |||||||||
231 | NaviSite, Inc.* | 899 | |||||||||
118 | NDS Group PLC ADR (United Kingdom)* | 6,071 | |||||||||
256 | Ness Technologies, Inc.* | 2,322 | |||||||||
139 | Netlogic Microsystems, Inc.* | 4,558 | |||||||||
335 | Netscout Systems, Inc.* | 3,350 | |||||||||
108 | Neutral Tandem, Inc.* | �� | 2,077 | ||||||||
325 | Newport Corp.* | 3,741 | |||||||||
605 | Nextwave Wireless, Inc.* | 3,866 | |||||||||
402 | NIC, Inc. | 2,605 | |||||||||
85 | Novatel Wireless, Inc.* | 758 | |||||||||
161 | NU Horizons Electronics Corp.* | 919 | |||||||||
335 | O2Micro International Ltd. ADR (Cayman Islands)* | 2,543 |
See Notes to Financial Statements.
67
Schedule of Investments (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
252 | Online Resources Corp.* | $ | 2,548 | ||||||||
959 | OpenTV Corp., Class A* | 1,084 | |||||||||
724 | Openwave Systems, Inc. | 1,549 | |||||||||
191 | Oplink Communications, Inc.* | 1,836 | |||||||||
135 | Opnet Technologies, Inc.* | 1,227 | |||||||||
169 | Opnext, Inc.* | 997 | |||||||||
67 | Optium Corp.* | 521 | |||||||||
272 | Orbcomm, Inc.* | 1,602 | |||||||||
290 | Orbotech Ltd. (Israel)* | 5,090 | |||||||||
138 | Orckit Communications Ltd. (Israel)* | 1,003 | |||||||||
155 | OSI Systems, Inc.* | 3,790 | |||||||||
315 | Packeteer, Inc.* | 2,221 | |||||||||
163 | Parkervision, Inc.* | 1,454 | |||||||||
70 | PC Connection, Inc.* | 523 | |||||||||
192 | PC-Tel, Inc. | 1,578 | |||||||||
184 | PDF Solutions, Inc.* | 880 | |||||||||
127 | Pegasystems, Inc. | 1,342 | |||||||||
103 | Perfect World Co. Ltd. ADR (Cayman Islands)* | 2,958 | |||||||||
269 | Perficient, Inc.* | 2,469 | |||||||||
229 | Pericom Semiconductor Corp.* | 3,902 | |||||||||
240 | Phoenix Technologies Ltd.* | 2,830 | |||||||||
155 | Photon Dynamics, Inc.* | 1,716 | |||||||||
362 | Photronics, Inc.* | 3,837 | |||||||||
155 | Planar Systems, Inc.* | 353 | |||||||||
208 | PLATO Learning, Inc.* | 580 | |||||||||
251 | PLX Technology, Inc.* | 2,166 | |||||||||
259 | Power Integrations, Inc.* | 8,073 | |||||||||
1,140 | Powerwave Technologies, Inc.* | 3,112 | |||||||||
320 | Presstek, Inc.* | 1,526 | |||||||||
109 | QAD, Inc. | 828 | |||||||||
193 | Qiao Xing Universal Telephone, Inc. (China)* | 1,227 | |||||||||
257 | Rackable Systems, Inc.* | 2,827 | |||||||||
278 | Radiant Systems, Inc.* | 3,750 | |||||||||
195 | Radisys Corp.* | 1,839 | |||||||||
191 | RADVision Ltd. (Israel)* | 1,316 | |||||||||
167 | RADWARE Ltd. (Israel)* | 1,652 | |||||||||
164 | Radyne Corp.* | 1,279 | |||||||||
102 | Renaissance Learning, Inc. | 1,434 | |||||||||
169 | Retalix Ltd. (Israel)* | 2,383 | |||||||||
117 | RightNow Technologies, Inc.* | 1,400 | |||||||||
85 | Rimage Corp.* | 1,519 | |||||||||
200 | Rudolph Technologies, Inc.* | 2,032 | |||||||||
508 | S1 Corp.* | 3,434 | |||||||||
101 | Salary.com, Inc.* | 651 | |||||||||
260 | Seachange International, Inc.* | 1,862 | |||||||||
586 | Secure Computing Corp.* | 3,879 | |||||||||
213 | Semitool, Inc.* | 1,881 | |||||||||
75 | ShoreTel, Inc.* | 347 | |||||||||
86 | SI International, Inc.* | 1,973 | |||||||||
272 | Sierra Wireless, Inc. (Canada)* | 5,086 | |||||||||
218 | Sify Technologies Ltd. ADR (India)* | 1,112 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
76 | Silicon Graphics, Inc.* | $ | 821 | ||||||||
737 | Silicon Image, Inc.* | 4,400 | |||||||||
273 | Silicon Motion Technology Corp. ADR (Taiwan, Republic of China)* | 4,758 | |||||||||
912 | Silicon Storage Technology, Inc.* | 2,800 | |||||||||
124 | SM&A * | 616 | |||||||||
396 | Smart Modular Technologies WWH, Inc.* | 2,388 | |||||||||
264 | Smith Micro Software, Inc.* | 2,278 | |||||||||
228 | Sonic Solutions, Inc.* | 2,095 | |||||||||
543 | SonicWALL, Inc.* | 4,176 | |||||||||
64 | Sourcefire, Inc.* | 438 | |||||||||
599 | SourceForge, Inc.* | 1,072 | |||||||||
116 | Spectrum Control, Inc.* | 995 | |||||||||
117 | SPSS, Inc.* | 4,942 | |||||||||
204 | Standard Microsystems Corp.* | 6,049 | |||||||||
218 | STEC, Inc.* | 2,001 | |||||||||
183 | Stratasys, Inc.* | 3,558 | |||||||||
224 | SuccessFactors, Inc.* | 2,473 | |||||||||
80 | Super Micro Computer, Inc.* | 597 | |||||||||
113 | Supertex, Inc.* | 2,425 | |||||||||
404 | SupportSoft, Inc.* | 1,450 | |||||||||
120 | Switch & Data Facilities Co., Inc.* | 1,817 | |||||||||
268 | SYKES Enterprises, Inc.* | 4,454 | |||||||||
399 | Symmetricom, Inc.* | 1,712 | |||||||||
291 | Symyx Technologies, Inc.* | 2,185 | |||||||||
117 | Synplicity, Inc.* | 931 | |||||||||
165 | Taleo Corp., Class A* | 3,218 | |||||||||
106 | TechTarget, Inc.* | 1,423 | |||||||||
54 | Techwell, Inc.* | 567 | |||||||||
102 | Telvent GIT S.A. (Spain) | 2,809 | |||||||||
516 | Terremark Worldwide, Inc.* | 3,106 | |||||||||
116 | The9 Ltd. ADR (China)* | 2,491 | |||||||||
258 | TheStreet.com, Inc. | 2,015 | |||||||||
866 | Tivo, Inc.* | 7,127 | |||||||||
116 | Tollgrade Communications, Inc.* | 585 | |||||||||
105 | Transmeta Corp.* | 1,512 | |||||||||
1,156 | Transwitch Corp.* | 809 | |||||||||
25 | Travelzoo, Inc.* | 279 | |||||||||
529 | Trident Microsystems, Inc.* | 2,296 | |||||||||
1,231 | TriQuint Semiconductor, Inc.* | 8,112 | |||||||||
369 | TTM Technologies, Inc.* | 4,911 | |||||||||
216 | Ultimate Software Group, Inc.* | 7,083 | |||||||||
187 | Ultra Clean Holdings* | 1,999 | |||||||||
203 | Ultratech, Inc.* | 2,895 | |||||||||
71 | Unica Corp.* | 496 | |||||||||
309 | Universal Display Corp.* | 4,570 | |||||||||
1,058 | Utstarcom, Inc.* | 3,439 | |||||||||
243 | Vasco Data Security International, Inc.* | 2,452 | |||||||||
208 | Veeco Instruments, Inc.* | 3,917 | |||||||||
233 | Vignette Corp.* | 2,691 | |||||||||
205 | Virage Logic Corp.* | 1,226 | |||||||||
40 | Virtusa Corp.* | 444 |
See Notes to Financial Statements.
68
Schedule of Investments (Continued)
PowerShares FTSE NASDAQ Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
115 | Vocus, Inc.* | $ | 3,196 | ||||||||
210 | Volterra Semiconductor Corp.* | 3,163 | |||||||||
82 | WebMD Health Corp., Class A* | 2,571 | |||||||||
237 | Website Pros, Inc.* | 2,133 | |||||||||
254 | X-Rite, Inc.* | 640 | |||||||||
75 | Xyratex Ltd. (Bermuda)* | 1,475 | |||||||||
976 | Zhone Technologies, Inc.* | 956 | |||||||||
528 | Zix Corp.* | 2,006 | |||||||||
150 | Zygo Corp.* | 1,749 | |||||||||
662,861 | |||||||||||
Materials—2.5% | |||||||||||
45 | AEP Industries, Inc.* | 1,270 | |||||||||
613 | Altair Nanotechnologies, Inc.* | 1,410 | |||||||||
150 | Arabian American Development Co.* | 1,014 | |||||||||
156 | Balchem Corp. | 3,566 | |||||||||
258 | Caraustar Industries, Inc.* | 359 | |||||||||
161 | China Precision Steel, Inc.* | 596 | |||||||||
233 | DRDGOLD Ltd. ADR (South Africa)* | 1,775 | |||||||||
344 | Esmark, Inc.* | 5,741 | |||||||||
94 | GenTek, Inc.* | 2,920 | |||||||||
90 | Hawkins, Inc. | 1,388 | |||||||||
304 | Horsehead Holding Corp.* | 4,262 | |||||||||
238 | ICO, Inc.* | 1,768 | |||||||||
91 | Innophos Holdings, Inc. | 1,630 | |||||||||
210 | Innospec, Inc. | 4,282 | |||||||||
227 | Landec Corp.* | 1,841 | |||||||||
195 | Lihir Gold Ltd. ADR (Australia) | 5,563 | |||||||||
317 | Mercer International, Inc.* | 2,127 | |||||||||
94 | Olympic Steel, Inc. | 4,813 | |||||||||
98 | Penford Corp. | 2,152 | |||||||||
263 | Royal Gold, Inc. | 7,440 | |||||||||
355 | ShengdaTech, Inc.* | 2,741 | |||||||||
16 | United States Lime & Minerals, Inc.* | 578 | |||||||||
58 | Universal Stainless & Alloy* | 2,219 | |||||||||
343 | US Concrete, Inc.* | 1,132 | |||||||||
62,587 | |||||||||||
Telecommunication Services—2.0% | |||||||||||
67 | 012 Smile.Communications Ltd. (Israel)* | 712 | |||||||||
374 | Alaska Communications Systems Group, Inc. | 4,181 | |||||||||
73 | America Movil SAB de CV ADR, Class A (Mexico) | 4,225 | |||||||||
168 | Arbinet-thexchange, Inc. | 578 | |||||||||
99 | Atlantic Tele-Network, Inc. | 3,082 | |||||||||
317 | Cogent Communications Group, Inc.* | 6,659 | |||||||||
171 | Consolidated Communications Holdings, Inc. | 2,445 | |||||||||
126 | D&E Communications, Inc. | 1,134 | |||||||||
1,265 | FiberTower Corp.* | 1,923 | |||||||||
330 | General Communication, Inc., Class A* | 2,049 | |||||||||
346 | Gilat Satellite Networks Ltd. (Israel)* | 3,699 | |||||||||
324 | Ibasis, Inc. | 1,034 | |||||||||
716 | Kratos Defense & Security Solutions, Inc.* | 1,203 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
162 | Partner Communications ADR (Israel) | $ | 3,770 | ||||||||
135 | Rural Cellular Corp., Class A* | 5,999 | |||||||||
203 | Shenandoah Telecom Co. | 2,753 | |||||||||
127 | SureWest Communications | 1,767 | |||||||||
51 | Telefonos de Mexico SAB de CV ADR, Class A (Mexico) | 1,798 | |||||||||
239 | USA Mobility, Inc. | 1,706 | |||||||||
50,717 | |||||||||||
Utilities—0.7% | |||||||||||
104 | Cadiz, Inc.* | 1,972 | |||||||||
73 | Connecticut Water Service, Inc. | 1,743 | |||||||||
126 | Consolidated Water Co., Inc. (Cayman Islands) | 2,986 | |||||||||
71 | EnergySouth, Inc. | 3,837 | |||||||||
115 | Middlesex Water Co. | 2,114 | |||||||||
211 | Southwest Water Co. | 2,351 | |||||||||
239 | Synthesis Energy Systems, Inc.* | 2,129 | |||||||||
98 | York Water Co. | 1,552 | |||||||||
18,684 | |||||||||||
Total Common Stocks (Cost $2,563,170) | 2,553,771 | ||||||||||
Money Market Fund—0.0% | |||||||||||
430 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $430) | 430 | |||||||||
Total Investments (Cost $2,563,600)—99.7% | 2,554,201 | ||||||||||
Other assets less liabilities—0.3% | 8,691 | ||||||||||
Net Assets—100.0% | $ | 2,562,892 |
ADR American Depositary Receipt.
* Non-income producing security.
See Notes to Financial Statements.
69
Schedule of Investments
PowerShares Zacks Micro Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests—100.2% | |||||||||||
Consumer Discretionary—12.9% | |||||||||||
27,082 | 1-800-FLOWERS.COM, Inc., Class A* | $ | 238,863 | ||||||||
11,847 | Aftermarket Technology Corp.* | 271,415 | |||||||||
18,318 | America's Car-Mart, Inc.* | 263,596 | |||||||||
16,744 | Asbury Automotive Group, Inc. | 278,787 | |||||||||
21,577 | Audiovox Corp., Class A* | 235,621 | |||||||||
5,284 | Avatar Holdings, Inc.* | 215,904 | |||||||||
29,515 | Carriage Services, Inc.* | 244,975 | |||||||||
6,575 | Cavco Industries, Inc.* | 262,474 | |||||||||
4,873 | Churchill Downs, Inc. | 248,767 | |||||||||
8,018 | Core-Mark Holding Co., Inc.* | 229,796 | |||||||||
6,605 | CSS Industries, Inc. | 206,538 | |||||||||
12,011 | DG FastChannel, Inc.* | 224,005 | |||||||||
5,856 | DXP Enterprises, Inc.* | 241,677 | |||||||||
59,230 | Eddie Bauer Holdings, Inc.* | 235,735 | |||||||||
34,592 | Entravision Communications Corp., Class A* | 241,798 | |||||||||
22,487 | Fred's, Inc., Class A | 249,156 | |||||||||
19,704 | Furniture Brands International, Inc. | 266,989 | |||||||||
13,290 | Gaiam, Inc., Class A* | 233,904 | |||||||||
40,496 | Gray Television, Inc. | 190,331 | |||||||||
36,126 | Great Wolf Resorts, Inc.* | 220,730 | |||||||||
9,821 | Group 1 Automotive, Inc. | 262,024 | |||||||||
21,657 | Haverty Furniture Cos., Inc. | 197,728 | |||||||||
13,750 | Helen of Troy Ltd.* | 232,513 | |||||||||
10,327 | Hooker Furniture Corp. | 216,557 | |||||||||
8,352 | JAKKS Pacific, Inc.* | 196,188 | |||||||||
15,641 | Jo-Ann Stores, Inc.* | 296,240 | |||||||||
14,140 | Landry's Restaurants, Inc. | 225,816 | |||||||||
27,612 | La-Z-Boy, Inc. | 175,888 | |||||||||
13,686 | Libbey, Inc. | 194,341 | |||||||||
23,997 | Lin TV Corp., Class A* | 240,450 | |||||||||
20,654 | Lodgian, Inc.* | 200,550 | |||||||||
18,492 | MarineMax, Inc.* | 210,809 | |||||||||
15,916 | Modine Manufacturing Co. | 279,643 | |||||||||
24,322 | Monaco Coach Corp. | 153,958 | |||||||||
11,830 | Movado Group, Inc. | 258,367 | |||||||||
4,383 | National Presto Industries, Inc. | 237,515 | |||||||||
19,986 | O'Charleys, Inc. | 231,838 | |||||||||
21,670 | PC Mall, Inc.* | 284,960 | |||||||||
23,156 | PEP Boys-Manny, Moe & Jack | 206,552 | |||||||||
10,557 | Perry Ellis International, Inc.* | 241,122 | |||||||||
29,098 | R.G. Barry Corp.* | 234,821 | |||||||||
26,928 | Red Lion Hotels Corp.* | 255,547 | |||||||||
11,698 | Rex Stores Corp.* | 189,391 | |||||||||
16,387 | Russ Berrie & Co., Inc.* | 229,746 | |||||||||
8,278 | Skyline Corp. | 227,811 | |||||||||
19,274 | Sport Supply Group, Inc. | 222,615 | |||||||||
8,085 | Steinway Musical Instruments * | 234,465 | |||||||||
35,901 | Stewart Enterprises, Inc., Class A | 245,204 | |||||||||
12,629 | StoneMor Partners L.P. | 245,003 | |||||||||
17,136 | Stoneridge, Inc.* | 249,672 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
11,118 | Superior Industries International, Inc. | $ | 225,807 | ||||||||
79,738 | Unifi, Inc.* | 238,417 | |||||||||
12,142,619 | |||||||||||
Consumer Staples—2.6% | |||||||||||
12,690 | Diamond Foods, Inc. | 271,058 | |||||||||
11,554 | Elizabeth Arden, Inc.* | 213,865 | |||||||||
9,957 | Farmer Bros. Co. | 246,137 | |||||||||
10,442 | Inter Parfums, Inc. | 302,400 | |||||||||
6,795 | Nash Finch Co. | 248,561 | |||||||||
16,879 | Omega Protein Corp.* | 253,185 | |||||||||
28,153 | Prestige Brands Holdings, Inc.* | 252,814 | |||||||||
12,282 | Susser Holdings Corp.* | 187,792 | |||||||||
4,465 | Village Super Market, Inc., Class A | 210,257 | |||||||||
23,690 | Zhongpin, Inc.* | 248,745 | |||||||||
2,434,814 | |||||||||||
Energy—6.3% | |||||||||||
16,721 | Allis-Chalmers Energy, Inc.* | 268,038 | |||||||||
37,958 | Brigham Exploration Co.* | 358,323 | |||||||||
12,740 | Callon Petroleum Co.* | 254,800 | |||||||||
4,383 | Clayton Williams Energy, Inc.* | 276,961 | |||||||||
12,558 | Constellation Energy Partners LLC | 217,505 | |||||||||
3,420 | Dawson Geophysical Co.* | 247,403 | |||||||||
8,970 | EV Energy Partner LP | 239,678 | |||||||||
12,730 | Geokinetics, Inc.* | 241,615 | |||||||||
12,800 | Global Partners L.P. | 259,328 | |||||||||
6,605 | GMX Resources, Inc.* | 240,026 | |||||||||
21,735 | Gulfport Energy Corp.* | 251,909 | |||||||||
19,100 | Harvest Natural Resources, Inc.* | 181,259 | |||||||||
8,648 | Knightsbridge Tankers Ltd. (Bermuda) | 249,581 | |||||||||
6,504 | K-Sea Transportation Partners L.P. | 238,957 | |||||||||
12,931 | Mitcham Industries, Inc.* | 241,810 | |||||||||
45,173 | Newpark Resources, Inc.* | 248,000 | |||||||||
29,741 | Parker Drilling Co.* | 238,523 | |||||||||
7,289 | PHI, Inc.* | 273,848 | |||||||||
14,479 | Pioneer Drilling Co.* | 236,442 | |||||||||
14,841 | StealthGas, Inc. (Marshall Islands) | 238,050 | |||||||||
5,395 | T-3 Energy Services, Inc.* | 284,855 | |||||||||
8,136 | TransMontaigne Partners L.P. | 235,944 | |||||||||
5,910 | Trico Marine Services, Inc.* | 222,748 | |||||||||
13,170 | Union Drilling, Inc.* | 222,705 | |||||||||
5,968,308 | |||||||||||
Financials—24.8% | |||||||||||
10,948 | 1st Source Corp. | 216,989 | |||||||||
18,860 | AmCOMP, Inc.* | 232,355 | |||||||||
24,818 | American Equity Investment Life Holding Co. | 239,494 | |||||||||
4,987 | American Physicians Capital, Inc. | 231,147 | |||||||||
11,778 | American Physicians Service Group, Inc. | 255,347 |
See Notes to Financial Statements.
70
Schedule of Investments (Continued)
PowerShares Zacks Micro Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
13,474 | American Safety Insurance Holdings Ltd. (Bermuda)* | $ | 228,250 | ||||||||
18,225 | Amerisafe, Inc.* | 259,889 | |||||||||
12,167 | Anchor Bancorp Wisconsin, Inc. | 184,817 | |||||||||
37,587 | Anworth Mortgage Asset Corp. | 251,081 | |||||||||
15,272 | Arbor Realty Trust, Inc. | 263,747 | |||||||||
8,971 | Baldwin & Lyons, Inc., Class B | 213,241 | |||||||||
14,951 | Banco Latinoamericano de Exportaciones, S.A., Class E (Panama) | 281,078 | |||||||||
21,476 | Bank Mutual Corp. | 240,316 | |||||||||
14,468 | BankFinancial Corp. | 232,067 | |||||||||
10,005 | Banner Corp. | 216,108 | |||||||||
9,167 | Berkshire Hills Bancorp, Inc. | 234,584 | |||||||||
19,757 | BGC Partners, Inc., Class A* | 190,457 | |||||||||
20,077 | Brookline Bancorp, Inc. | 216,832 | |||||||||
1,857 | Capital Southwest Corp. | 220,872 | |||||||||
29,672 | CapLease, Inc. | 246,574 | |||||||||
20,200 | Capstead Mortgage Corp. | 260,580 | |||||||||
19,734 | Cedar Shopping Centers, Inc. | 246,675 | |||||||||
36,685 | Centennial Bank Holdings, Inc.* | 229,648 | |||||||||
16,028 | CFS Bancorp, Inc. | 230,002 | |||||||||
9,660 | Chemical Financial Corp. | 234,545 | |||||||||
34,431 | Citizens, Inc.* | 242,739 | |||||||||
5,764 | City Holding Co. | 239,667 | |||||||||
14,973 | CNA Surety Corp.* | 198,093 | |||||||||
10,304 | Columbia Banking System, Inc. | 279,031 | |||||||||
9,399 | Community Bank System, Inc. | 239,581 | |||||||||
7,866 | Community Trust Bancorp, Inc. | 236,452 | |||||||||
17,540 | Compass Diversified Holdings | 215,040 | |||||||||
23,690 | Corus Bankshares, Inc. | 173,648 | |||||||||
10,235 | Darwin Professional Underwriters, Inc.* | 253,316 | |||||||||
13,179 | Dime Community Bancshares, Inc. | 246,052 | |||||||||
15,903 | Eastern Insurance Holdings, Inc. | 260,173 | |||||||||
18,349 | Education Realty Trust, Inc. | 244,776 | |||||||||
8,819 | Federal Agricultural Mortgage Corp., Class C | 282,207 | |||||||||
10,557 | Financial Federal Corp. | 246,506 | |||||||||
12,148 | Financial Institutions, Inc. | 237,007 | |||||||||
7,475 | First Financial Corp. | 237,705 | |||||||||
8,073 | First Merchants Corp. | 206,427 | |||||||||
13,248 | First Mercury Financial Corp.* | 209,318 | |||||||||
17,710 | First Place Financial Corp. | 221,375 | |||||||||
17,204 | First State Bancorporation | 159,997 | |||||||||
8,487 | FirstFed Financial Corp.* | 129,681 | |||||||||
31,914 | Flagstar Bancorp, Inc. | 195,314 | |||||||||
13,110 | Flushing Financial Corp. | 255,907 | |||||||||
4,890 | FPIC Insurance Group, Inc.* | 227,532 | |||||||||
14,822 | Gladstone Commercial Corp. | 258,051 | |||||||||
24,488 | Gladstone Investment Corp. | 217,209 | |||||||||
11,012 | Gramercy Capital Corp. | 209,228 | |||||||||
13,018 | Greene Bankshares, Inc. | 260,751 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
20,654 | Hallmark Financial Services, Inc.* | $ | 223,683 | ||||||||
15,962 | Harleysville National Corp. | 230,811 | |||||||||
21,231 | Hercules Technology Growth Capital, Inc. | 215,495 | |||||||||
25,519 | Hersha Hospitality Trust | 242,941 | |||||||||
22,160 | Hilltop Holdings, Inc.* | 234,010 | |||||||||
11,040 | Home Bancshares, Inc. | 256,459 | |||||||||
5,194 | IBERIABANK Corp. | 250,351 | |||||||||
7,797 | Independent Bank Corp. | 227,906 | |||||||||
5,554 | Infinity Property & Casualty Corp. | 215,273 | |||||||||
14,237 | Integra Bank Corp. | 208,003 | |||||||||
23,557 | Investors Real Estate Trust | 240,281 | |||||||||
4,807 | Kansas City Life Insurance Co. | 240,350 | |||||||||
9,246 | Kayne Anderson Energy Development Co. | 205,076 | |||||||||
22,195 | Kohlberg Capital Corp. | 222,838 | |||||||||
52,956 | LaBranche & Co., Inc.* | 338,388 | |||||||||
5,824 | LandAmerica Financial Group, Inc. | 167,149 | |||||||||
8,970 | LTC Properties, Inc. | 244,253 | |||||||||
14,865 | Mainsource Financial Group, Inc. | 220,151 | |||||||||
29,831 | Marathon Acquisition Corp.* | 230,892 | |||||||||
29,516 | Meadowbrook Insurance Group, Inc. | 213,696 | |||||||||
25,499 | Medallion Financial Corp. | 216,996 | |||||||||
20,360 | Medical Properties Trust, Inc. | 247,374 | |||||||||
13,242 | Mercer Insurance Group, Inc. | 227,630 | |||||||||
14,013 | NGP Capital Resources Co. | 226,030 | |||||||||
5,306 | Oppenheimer Holdings, Inc., Class A (Canada) | 198,179 | |||||||||
11,685 | Oriental Financial Group | 219,678 | |||||||||
22,011 | Patriot Capital Funding, Inc. | 224,072 | |||||||||
10,784 | Peoples Financial Corp. | 244,689 | |||||||||
7,620 | Pico Holdings, Inc.* | 269,137 | |||||||||
9,016 | Pinnacle Financial Partners, Inc.* | 244,334 | |||||||||
26,998 | PMA Capital Corp., Class A* | 250,541 | |||||||||
13,201 | Presidential Life Corp. | 223,889 | |||||||||
17,074 | Provident New York Bancorp | 228,109 | |||||||||
133,197 | Quanta Capital Holdings Ltd. (Bermuda) | 230,431 | |||||||||
10,235 | Renasant Corp. | 237,145 | |||||||||
6,755 | Safety Insurance Group, Inc. | 242,505 | |||||||||
8,372 | Sandy Spring Bancorp, Inc. | 213,486 | |||||||||
15,649 | SeaBright Insurance Holdings, Inc.* | 242,872 | |||||||||
7,751 | Simmons First National Corp., Class A | 248,110 | |||||||||
13,156 | Southwest Bancorp, Inc. | 231,546 | |||||||||
8,219 | Stewart Information Services Corp. | 201,283 | |||||||||
17,503 | Sun Bancorp, Inc.* | 202,860 | |||||||||
13,658 | Texas Capital Bancshares, Inc.* | 251,990 | |||||||||
4,683 | Tompkins Financial Corp. | 226,517 | |||||||||
1,800 | Transcontinental Realty Investors, Inc* | 33,822 | |||||||||
11,986 | United America Indemnity Ltd., Class A* | 185,304 | |||||||||
12,870 | United Western Bancorp, Inc. | 221,364 | |||||||||
14,651 | Urstadt Biddle Properties, Inc., Class A | 247,162 | |||||||||
23,590 | Westfield Financial, Inc. | 229,295 | |||||||||
23,333,834 |
See Notes to Financial Statements.
71
Schedule of Investments (Continued)
PowerShares Zacks Micro Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Health Care—7.1% | |||||||||||
25,438 | Acadia Pharmaceuticals, Inc.* | $ | 203,504 | ||||||||
4,773 | Air Methods Corp.* | 191,397 | |||||||||
18,980 | Albany Molecular Research, Inc.* | 220,548 | |||||||||
144,009 | Allied Healthcare International, Inc.* | 216,014 | |||||||||
55,791 | Allion Healthcare, Inc.* | 264,448 | |||||||||
17,712 | Ardea Biosciences, Inc.* | 265,679 | |||||||||
34,071 | BioScrip, Inc.* | 187,391 | |||||||||
27,598 | Cardiac Science Corp.* | 249,210 | |||||||||
8,978 | CONMED Corp.* | 229,119 | |||||||||
18,607 | Cross Country Healthcare, Inc.* | 222,540 | |||||||||
10,807 | Cynosure, Inc., Class A* | 281,197 | |||||||||
32,182 | Cypress Bioscience, Inc.* | 211,758 | |||||||||
5,547 | Datascope Corp. | 207,791 | |||||||||
9,154 | Exactech, Inc.* | 224,365 | |||||||||
10,609 | Gentiva Health Services, Inc.* | 230,640 | |||||||||
12,512 | Greatbatch, Inc.* | 227,468 | |||||||||
21,385 | Hanger Orthopedic Group, Inc.* | 252,343 | |||||||||
12,665 | Medcath Corp.* | 235,062 | |||||||||
6,544 | MWI Veterinary Supply, Inc.* | 225,572 | |||||||||
9,177 | Neogen Corp.* | 230,618 | |||||||||
9,124 | PharmaNet Development Group, Inc.* | 217,699 | |||||||||
7,678 | Providence Service (The) Corp.* | 216,059 | |||||||||
15,378 | RehabCare Group, Inc.* | 261,426 | |||||||||
13,453 | Res-Care, Inc.* | 219,149 | |||||||||
24,384 | RTI Biologics, Inc.* | 247,254 | |||||||||
13,881 | Symmetry Medical, Inc.* | 194,750 | |||||||||
14,710 | Synovis Life Technologies, Inc.* | 248,011 | |||||||||
58,492 | Theragenics Corp.* | 248,591 | |||||||||
12,662 | Vnus Medical Technologies, Inc.* | 207,024 | |||||||||
6,636,627 | |||||||||||
Industrials—19.8% | |||||||||||
33,193 | Aceto Corp. | 233,347 | |||||||||
10,844 | Alamo Group, Inc. | 220,784 | |||||||||
5,368 | Ampco-Pittsburgh Corp. | 242,741 | |||||||||
13,961 | Ascent Solar Technologies, Inc.* | 224,074 | |||||||||
4,627 | Axsys Technologies, Inc.* | 252,403 | |||||||||
6,480 | AZZ, Inc.* | 172,886 | |||||||||
15,108 | Bowne & Co., Inc. | 251,397 | |||||||||
11,017 | Canadian Solar, Inc. (China)* | 301,535 | |||||||||
28,359 | CBIZ, Inc.* | 251,544 | |||||||||
9,183 | CDI Corp. | 249,778 | |||||||||
61,134 | China BAK Battery, Inc.* | 227,418 | |||||||||
4,994 | CIRCOR International, Inc. | 240,561 | |||||||||
7,442 | Columbus McKinnon Corp.* | 210,683 | |||||||||
17,710 | Comfort Systems USA, Inc. | 240,856 | |||||||||
10,267 | Cornell Cos., Inc.* | 233,266 | |||||||||
8,323 | Ducommun, Inc.* | 271,163 | |||||||||
15,226 | Electro Rent Corp. | 205,703 | |||||||||
12,650 | Encore Wire Corp. | 285,890 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
7,385 | EnPro Industries, Inc.* | $ | 268,076 | ||||||||
19,222 | Euroseas Ltd. | 264,879 | |||||||||
7,875 | Excel Maritime Carriers Ltd. | 312,717 | |||||||||
7,030 | Exponent, Inc.* | 237,192 | |||||||||
16,514 | Federal Signal Corp. | 229,214 | |||||||||
29,039 | Frozen Food Express Industries, Inc. | 221,277 | |||||||||
15,318 | Fushi Copperweld, Inc.* | 247,692 | |||||||||
13,593 | Gehl Co.* | 209,740 | |||||||||
8,850 | GeoEye, Inc.* | 203,816 | |||||||||
19,641 | Gibraltar Industries, Inc. | 205,248 | |||||||||
24,259 | GP Strategies Corp.* | 206,202 | |||||||||
6,485 | Graham Corp. | 370,813 | |||||||||
8,671 | Greenbrier Cos., Inc. | 197,265 | |||||||||
16,757 | Hardinge, Inc. | 279,507 | |||||||||
22,265 | Herley Industries, Inc.* | 271,410 | |||||||||
4,922 | Hurco Cos, Inc.* | 225,378 | |||||||||
11,497 | ICF International, Inc.* | 205,106 | |||||||||
12,420 | Interline Brands, Inc.* | 240,327 | |||||||||
12,018 | International Shipholding Corp.* | 228,462 | |||||||||
7,839 | Kadant, Inc.* | 204,441 | |||||||||
8,142 | Kaman Corp. | 220,648 | |||||||||
11,201 | Kelly Services, Inc., Class A | 249,222 | |||||||||
7,751 | Key Technology, Inc.* | 238,886 | |||||||||
9,453 | KHD Humboldt Wedag International Ltd. (Canada)* | 274,042 | |||||||||
1,921 | K-Tron International, Inc.* | 263,177 | |||||||||
11,983 | L.S. Starrett Co., Class A | 233,669 | |||||||||
6,575 | Layne Christensen Co.* | 280,555 | |||||||||
5,338 | L.B. Foster Co., Class A* | 171,350 | |||||||||
16,422 | Learning Tree International, Inc.* | 292,804 | |||||||||
24,610 | LECG Corp.* | 255,698 | |||||||||
11,888 | LMI Aerospace, Inc.* | 228,250 | |||||||||
20,122 | Lydall, Inc.* | 234,421 | |||||||||
14,858 | Marten Transport Ltd.* | 242,185 | |||||||||
23,474 | Metalico, Inc.* | 304,224 | |||||||||
10,267 | Michael Baker Corp.* | 216,223 | |||||||||
2,852 | NACCO Industries, Inc., Class A | 256,395 | |||||||||
41,921 | North American Galvanizing & Coatings, Inc.* | 221,343 | |||||||||
5,444 | Northwest Pipe Co.* | 231,479 | |||||||||
14,684 | Park-Ohio Holdings Corp.* | 244,929 | |||||||||
74,082 | Plug Power, Inc.* | 239,285 | |||||||||
5,864 | Powell Industries, Inc.* | 246,698 | |||||||||
59,686 | RCM Technologies, Inc.* | 245,309 | |||||||||
10,639 | Republic Airways Holdings, Inc.* | 179,374 | |||||||||
14,568 | Rush Enterprises, Inc., Class A* | 234,836 | |||||||||
15,691 | Rush Enterprises, Inc., Class B* | 235,836 | |||||||||
14,421 | Schawk, Inc. | 231,169 | |||||||||
7,293 | School Specialty, Inc.* | 214,706 | |||||||||
22,358 | SIFCO Industries, Inc.* | 327,546 | |||||||||
37,650 | Spherion Corp.* | 185,991 |
See Notes to Financial Statements.
72
Schedule of Investments (Continued)
PowerShares Zacks Micro Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
10,327 | Standex International Corp. | $ | 217,693 | ||||||||
12,650 | Sterling Construction Co., Inc.* | 254,012 | |||||||||
8,188 | Superior Essex, Inc.* | 243,429 | |||||||||
55,789 | Sypris Solutions, Inc. | 233,756 | |||||||||
7,502 | Tecumseh Products Co., Class A* | 235,038 | |||||||||
12,645 | Tredegar Corp. | 206,619 | |||||||||
19,504 | Ultralife Batteries, Inc.* | 200,891 | |||||||||
19,297 | Vicor Corp. | 232,722 | |||||||||
8,173 | VSE Corp. | 273,223 | |||||||||
28,364 | Waste Services, Inc.* | 221,523 | |||||||||
37,882 | WCA Waste Corp. * | 190,925 | |||||||||
18,654,872 | |||||||||||
Information Technology—20.9% | |||||||||||
15,042 | Actel Corp.* | 247,892 | |||||||||
78,382 | Adaptec, Inc.* | 218,686 | |||||||||
41,003 | Advanced Analogic Technologies, Inc.* | 283,741 | |||||||||
19,879 | Agilysys, Inc. | 217,874 | |||||||||
12,098 | Aladdin Knowledge Systems Ltd. (Israel)* | 176,026 | |||||||||
19,117 | Amtech Systems, Inc.* | 237,815 | |||||||||
18,193 | Anaren, Inc.* | 245,060 | |||||||||
21,229 | AsiaInfo Holdings, Inc.* | 258,357 | |||||||||
41,157 | Axcelis Technologies, Inc.* | 222,248 | |||||||||
8,257 | Bel Fuse, Inc., Class B | 215,260 | |||||||||
7,476 | Black Box Corp. | 222,261 | |||||||||
27,588 | Bluephoenix Solutions Ltd. (Israel)* | 235,877 | |||||||||
18,290 | Bottomline Technologies, Inc.* | 194,789 | |||||||||
27,554 | Brightpoint, Inc.* | 252,395 | |||||||||
23,713 | Brooks Automation, Inc.* | 245,667 | |||||||||
24,380 | Ceragon Networks Ltd. (Israel)* | 198,941 | |||||||||
30,115 | CEVA, Inc.* | 294,525 | |||||||||
47,008 | Ciber, Inc.* | 294,270 | |||||||||
17,377 | CMGI, Inc.* | 240,324 | |||||||||
14,168 | Cohu, Inc. | 246,098 | |||||||||
21,536 | CTS Corp. | 242,280 | |||||||||
15,755 | Cybersource Corp.* | 285,953 | |||||||||
19,962 | Digi International, Inc.* | 164,487 | |||||||||
18,078 | DSP Group, Inc.* | 237,364 | |||||||||
22,797 | Dynamics Research Corp.* | 227,286 | |||||||||
43,720 | Edgewater Technology, Inc.* | 261,008 | |||||||||
14,000 | Electro Scientific Industries, Inc.* | 229,740 | |||||||||
8,490 | EMS Technologies, Inc.* | 219,551 | |||||||||
14,851 | EPIQ Systems, Inc.* | 229,299 | |||||||||
28,011 | Exar Corp.* | 236,133 | |||||||||
47,705 | Exfo Electro-Optical Engineering, Inc. (Canada)* | 272,396 | |||||||||
25,898 | Gerber Scientific, Inc.* | 240,074 | |||||||||
29,632 | GSI Group, Inc. (Canada)* | 241,501 | |||||||||
14,477 | Hutchinson Technology, Inc.* | 204,705 | |||||||||
53,107 | Hypercom Corp.* | 226,767 | |||||||||
32,424 | Immersion Corp.* | 366,066 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
7,889 | Integral Systems, Inc. | $ | 272,092 | ||||||||
38,089 | Integrated Silicon Solution, Inc.* | 223,963 | |||||||||
21,995 | Internet Capital Group, Inc.* | 221,050 | |||||||||
28,934 | InterVoice, Inc.* | 181,416 | |||||||||
21,584 | Interwoven, Inc.* | 243,036 | |||||||||
64,538 | Iomega Corp.* | 247,181 | |||||||||
12,645 | JDA Software Group, Inc.* | 238,991 | |||||||||
57,051 | KEMET Corp.* | 232,198 | |||||||||
19,542 | Keynote Systems, Inc.* | 225,710 | |||||||||
23,095 | Marchex, Inc., Class B | 238,571 | |||||||||
19,732 | Methode Electronics, Inc. | 213,895 | |||||||||
13,202 | Moldflow Corp.* | 260,872 | |||||||||
17,733 | MSC.Software Corp.* | 215,988 | |||||||||
12,282 | Multi-Fineline Electronix, Inc.* | 232,130 | |||||||||
12,243 | NCI, Inc., Class A* | 258,327 | |||||||||
24,288 | Ness Technologies, Inc.* | 220,292 | |||||||||
24,771 | NetScout Systems, Inc.* | 247,710 | |||||||||
35,054 | Network Equipment Technologies, Inc.* | 227,851 | |||||||||
29,816 | O2Micro International Ltd. ADR (Cayman Islands)* | 226,303 | |||||||||
25,967 | Oplink Communications, Inc.* | 249,543 | |||||||||
12,581 | Orbotech Ltd. (Israel)* | 220,797 | |||||||||
10,005 | OSI Systems, Inc.* | 244,622 | |||||||||
18,187 | Perceptron, Inc.* | 182,961 | |||||||||
15,708 | Pericom Semiconductor Corp.* | 267,664 | |||||||||
21,735 | Photon Dynamics, Inc.* | 240,606 | |||||||||
24,127 | Photronics, Inc.* | 255,746 | |||||||||
22,840 | Radisys Corp.* | 215,381 | |||||||||
23,598 | Rudolph Technologies, Inc.* | 239,756 | |||||||||
32,427 | S1 Corp.* | 219,207 | |||||||||
35,736 | Secure Computing Corp.* | 236,572 | |||||||||
12,006 | SI International, Inc.* | 275,418 | |||||||||
14,448 | Sierra Wireless, Inc. (Canada)* | 270,178 | |||||||||
79,741 | Sigmatel, Inc.* | 238,824 | |||||||||
32,189 | Soapstone Networks, Inc. | 225,323 | |||||||||
28,198 | SonicWALL, Inc.* | 216,843 | |||||||||
27,231 | Spectrum Control, Inc.* | 233,642 | |||||||||
7,889 | Standard Microsystems Corp.* | 233,909 | |||||||||
10,864 | SYNNEX Corp.* | 259,432 | |||||||||
9,746 | Telvent GIT S.A. (Spain) | 268,405 | |||||||||
28,906 | Tier Technologies, Inc., Class B* | 224,311 | |||||||||
45,551 | TriQuint Semiconductor, Inc.* | 300,180 | |||||||||
20,354 | TTM Technologies, Inc.* | 270,912 | |||||||||
23,979 | Ultratech, Inc.* | 341,940 | |||||||||
17,444 | Vignette Corp.* | 201,478 | |||||||||
23,437 | Website Pros, Inc.* | 210,933 | |||||||||
16,861 | Zoran Corp.* | 221,891 | |||||||||
19,626,766 |
See Notes to Financial Statements.
73
Schedule of Investments (Continued)
PowerShares Zacks Micro Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Materials—4.1% | |||||||||||
8,535 | AM Castle & Co. | $ | 263,817 | ||||||||
14,441 | American Pacific Corp.* | 248,818 | |||||||||
20,664 | Buckeye Technologies, Inc.* | 178,330 | |||||||||
15,304 | Calgon Carbon Corp.* | 218,082 | |||||||||
15,251 | Glatfelter | 222,512 | |||||||||
17,480 | Headwaters, Inc.* | 199,796 | |||||||||
33,209 | ICO, Inc.* | 246,743 | |||||||||
33,050 | Mercer International, Inc.* | 221,766 | |||||||||
5,101 | Olympic Steel, Inc. | 261,171 | |||||||||
10,608 | Penford Corp. | 232,952 | |||||||||
36,185 | PolyOne Corp.* | 267,045 | |||||||||
7,360 | Quaker Chemical Corp. | 228,160 | |||||||||
11,239 | Schulman (A.), Inc. | 238,267 | |||||||||
9,961 | Schweitzer-Mauduit International, Inc. | 220,437 | |||||||||
6,039 | Stepan Co. | 237,574 | |||||||||
68,784 | U.S. Energy Corp. | 188,468 | |||||||||
90,730 | US Gold Corp.* | 185,997 | |||||||||
3,859,935 | |||||||||||
Telecommunication Services—0.7% | |||||||||||
6,825 | Atlantic Tele-Network, Inc. | 212,462 | |||||||||
25,878 | D&E Communications, Inc. | 232,902 | |||||||||
21,274 | Gilat Satellite Networks Ltd. (Israel)* | 227,419 | |||||||||
672,783 | |||||||||||
Utilities—1.0% | |||||||||||
9,648 | Central Vermont Public Service Corp. | 224,798 | |||||||||
5,914 | CH Energy Group, Inc. | 209,119 | |||||||||
11,373 | Empire District Electric (The) Co. | 236,900 | |||||||||
76,785 | Star Gas Partners, L.P.* | 227,284 | |||||||||
898,101 | |||||||||||
Total Common Stocks and Other Equity Interests (Cost $101,765,356) | 94,228,659 | ||||||||||
Money Market Fund—0.2% | |||||||||||
181,403 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $181,403) | 181,403 | |||||||||
Total Investments (Cost $101,946,759)—100.4% | 94,410,062 | ||||||||||
Liabilities in excess of other assets—(0.4%) | (342,535 | ) | |||||||||
Net Assets—100.0% | $ | 94,067,527 |
ADR American Depositary Receipt.
* Non-income producing security.
See Notes to Financial Statements.
74
Schedule of Investments
PowerShares Zacks Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests—100.3% | |||||||||||
Consumer Discretionary—16.0% | |||||||||||
20,705 | 1-800-FLOWERS.COM, Inc., Class A* | $ | 182,618 | ||||||||
7,435 | American Axle & Manufacturing Holdings, Inc. | 149,741 | |||||||||
7,419 | Blyth, Inc. | 124,936 | |||||||||
5,436 | Bob Evans Farms, Inc. | 152,589 | |||||||||
9,401 | Brown Shoe Co., Inc. | 156,809 | |||||||||
8,517 | Brunswick Corp. | 142,064 | |||||||||
3,890 | Buckle (The), Inc. | 188,976 | |||||||||
16,553 | Champion Enterprises, Inc.* | 170,827 | |||||||||
9,476 | Cooper Tire & Rubber Co. | 124,515 | |||||||||
1,334 | Deckers Outdoor Corp.* | 184,185 | |||||||||
7,638 | DG Fastchannel, Inc.* | 142,449 | |||||||||
5,972 | Drew Industries, Inc.* | 145,657 | |||||||||
12,702 | FTD Group, Inc. | 174,653 | |||||||||
16,935 | Furniture Brands International, Inc. | 229,468 | |||||||||
6,635 | Gaiam, Inc., Class A* | 116,776 | |||||||||
19,555 | Great Wolf Resorts, Inc.* | 119,481 | |||||||||
11,835 | INVESTools, Inc.* | 137,168 | |||||||||
16,660 | Jones Apparel Group, Inc. | 263,727 | |||||||||
8,904 | K-Swiss, Inc., Class A | 130,444 | |||||||||
10,445 | Libbey, Inc. | 148,319 | |||||||||
12,390 | Lin TV Corp., Class A* | 124,148 | |||||||||
10,717 | LodgeNet Entertainment Corp.* | 65,588 | |||||||||
13,040 | Maidenform Brands, Inc.* | 194,296 | |||||||||
8,503 | Media General, Inc., Class A | 124,824 | |||||||||
10,473 | Modine Manufacturing Co. | 184,011 | |||||||||
6,674 | Movado Group, Inc. | 145,760 | |||||||||
12,732 | Noble International, Ltd. | 79,575 | |||||||||
15,507 | Overstock.com, Inc.* | 298,044 | |||||||||
9,215 | Perry Ellis International, Inc.* | 210,471 | |||||||||
19,069 | Playboy Enterprises, Inc., Class B* | 159,417 | |||||||||
19,818 | Sally Beauty Holdings, Inc.* | 120,097 | |||||||||
4,720 | Scholastic Corp.* | 132,868 | |||||||||
8,314 | Shutterfly, Inc.* | 135,934 | |||||||||
17,968 | Sinclair Broadcast Group, Inc., Class A | 157,939 | |||||||||
8,077 | Skechers U.S.A., Inc., Class A* | 191,021 | |||||||||
15,313 | Stamps.com, Inc.* | 209,941 | |||||||||
4,370 | Tupperware Brands Corp. | 172,178 | |||||||||
16,915 | Valassis Communications, Inc.* | 240,192 | |||||||||
4,507 | Warnaco Group (The), Inc.* | 207,953 | |||||||||
6,339,659 | |||||||||||
Consumer Staples—2.4% | |||||||||||
3,550 | Andersons (The), Inc. | 161,348 | |||||||||
13,942 | Darling International, Inc.* | 212,895 | |||||||||
8,065 | Elizabeth Arden, Inc.* | 149,283 | |||||||||
4,197 | Green Mountain Coffee Roasters, Inc.* | 135,143 | |||||||||
7,357 | Imperial Sugar Co. | 116,020 | |||||||||
9,128 | Winn-Dixie Stores, Inc.* | 161,839 | |||||||||
936,528 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Energy—9.5% | |||||||||||
14,701 | Allis-Chalmers Energy, Inc.* | $ | 235,656 | ||||||||
8,444 | Bois d'Arc Energy, Inc.* | 201,812 | |||||||||
5,734 | Buckeye GP Holdings L.P. | 145,357 | |||||||||
10,495 | Callon Petroleum Co.* | 209,900 | |||||||||
4,938 | Crosstex Energy, Inc. | 170,904 | |||||||||
2,821 | Dawson Geophysical Co.* | 204,071 | |||||||||
4,961 | Encore Acquisition Co.* | 226,370 | |||||||||
16,773 | ENGlobal Corp.* | 168,569 | |||||||||
28,271 | FX Energy, Inc.* | 140,790 | |||||||||
3,867 | GulfMark Offshore, Inc.* | 231,247 | |||||||||
13,342 | Harvest Natural Resources, Inc.* | 126,616 | |||||||||
8,972 | Matrix Service Co.* | 180,427 | |||||||||
5,178 | Nordic American Tanker Shipping Ltd. | 174,602 | |||||||||
23,266 | Parker Drilling Co.* | 186,593 | |||||||||
13,953 | Rex Energy Corp.* | 302,779 | |||||||||
9,225 | Rosetta Resources, Inc.* | 201,013 | |||||||||
15,002 | RPC, Inc. | 191,576 | |||||||||
5,039 | Trico Marine Services, Inc.* | 189,920 | |||||||||
20,039 | USEC, Inc.* | 92,981 | |||||||||
4,851 | Willbros Group, Inc.* | 175,073 | |||||||||
3,756,256 | |||||||||||
Financials—15.6% | |||||||||||
3,912 | American Physicians Capital, Inc. | 181,321 | |||||||||
11,763 | Amerisafe, Inc.* | 167,740 | |||||||||
10,301 | Amtrust Financial Services, Inc. | 160,181 | |||||||||
6,467 | Anchor BanCorp Wisconsin, Inc. | 98,234 | |||||||||
10,482 | Banco Latinoamericano de Exportaciones, S.A., Class E (Panama) | 197,061 | |||||||||
13,155 | Bank Mutual Corp. | 147,204 | |||||||||
9,070 | CNA Surety Corp.* | 119,996 | |||||||||
6,174 | eHealth, Inc.* | 167,007 | |||||||||
12,249 | EZCORP, Inc., Class A* | 148,703 | |||||||||
11,818 | Flagstone Reinsurance Holdings Ltd. | 144,534 | |||||||||
2,725 | GAMCO Investors, Inc., Class A | 125,377 | |||||||||
2,395 | Greenhill & Co., Inc. | 155,795 | |||||||||
12,430 | Hallmark Financial Services, Inc.* | 134,617 | |||||||||
13,880 | Hercules Technology Growth Capital, Inc. | 140,882 | |||||||||
4,056 | Infinity Property & Casualty Corp. | 157,211 | |||||||||
6,287 | IPC Holdings Ltd. | 183,015 | |||||||||
28,321 | LaBranche & Co., Inc.* | 180,971 | |||||||||
7,975 | Life Partners Holdings, Inc. | 133,023 | |||||||||
17,112 | MarketAxess Holdings, Inc.* | 150,414 | |||||||||
5,697 | Max Capital Group Ltd. | 133,367 | |||||||||
12,271 | MCG Capital Corp. | 93,996 | |||||||||
17,578 | Meadowbrook Insurance Group, Inc. | 127,265 | |||||||||
2,801 | Navigators Group (The), Inc.* | 137,249 | |||||||||
5,564 | Northwest Bancorp, Inc. | 143,551 | |||||||||
10,128 | Oriental Financial Group, Inc. | 190,406 | |||||||||
14,349 | PennantPark Investment Corp. | 106,326 |
See Notes to Financial Statements.
75
Schedule of Investments (Continued)
PowerShares Zacks Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
14,929 | Phoenix (The) Cos., Inc. | $ | 194,076 | ||||||||
3,413 | Piper Jaffray Cos.* | 127,168 | |||||||||
20,113 | PMA Capital Corp., Class A* | 186,649 | |||||||||
2,804 | ProAssurance Corp.* | 148,416 | |||||||||
11,718 | Provident New York Bancorp | 156,552 | |||||||||
2,866 | RLI Corp. | 137,568 | |||||||||
10,288 | Roma Financial Corp. | 159,670 | |||||||||
11,009 | SeaBright Insurance Holdings, Inc.* | 170,860 | |||||||||
3,342 | SVB Financial Group* | 162,622 | |||||||||
3,836 | UMB Financial Corp. | 190,419 | |||||||||
7,886 | United America Indemnity Ltd., Class A* | 121,918 | |||||||||
6,641 | Validus Holdings Ltd. | 151,083 | |||||||||
10,630 | ViewPoint Financial Group | 172,738 | |||||||||
4,759 | W.P. Carey & Co. LLC | 142,199 | |||||||||
4,059 | Zenith National Insurance Corp. | 150,751 | |||||||||
6,198,135 | |||||||||||
Health Care—11.6% | |||||||||||
3,524 | Air Methods Corp.* | 141,312 | |||||||||
13,729 | Align Technology, Inc.* | 168,592 | |||||||||
12,139 | Alkermes, Inc.* | 150,888 | |||||||||
2,739 | Analogic Corp. | 157,739 | |||||||||
10,555 | Applera Corp. - Celera Group* | 141,226 | |||||||||
12,874 | Aspect Medical Systems, Inc.* | 85,998 | |||||||||
4,728 | Auxilium Pharmaceuticals, Inc.* | 145,386 | |||||||||
20,839 | BioScrip, Inc.* | 114,615 | |||||||||
23,269 | CryoLife, Inc.* | 247,117 | |||||||||
17,312 | Enzo Biochem, Inc.* | 141,612 | |||||||||
21,194 | Five Star Quality Care, Inc.* | 127,164 | |||||||||
14,583 | GTx, Inc.* | 248,639 | |||||||||
10,365 | Isis Pharmaceuticals, Inc.* | 122,100 | |||||||||
3,697 | Magellan Health Services, Inc.* | 142,667 | |||||||||
5,675 | Martek Biosciences Corp.* | 200,101 | |||||||||
22,681 | Nektar Therapeutics* | 109,322 | |||||||||
10,866 | Obagi Medical Products, Inc.* | 87,037 | |||||||||
20,444 | OraSure Technologies, Inc.* | 132,068 | |||||||||
18,673 | Pain Therapeutics, Inc.* | 129,591 | |||||||||
8,432 | Par Pharmaceutical Cos., Inc.* | 143,766 | |||||||||
10,831 | PDL BioPharma, Inc.* | 143,619 | |||||||||
5,479 | Providence Service (The) Corp.* | 154,179 | |||||||||
10,253 | Quidel Corp.* | 164,151 | |||||||||
20,215 | RTI Biologics, Inc.* | 204,980 | |||||||||
8,357 | Savient Pharmaceuticals, Inc.* | 182,517 | |||||||||
4,641 | SonoSite, Inc.* | 148,001 | |||||||||
8,285 | TriZetto Group (The), Inc.* | 174,399 | |||||||||
12,203 | Vnus Medical Technologies* | 199,519 | |||||||||
14,766 | Volcano Corp.* | 174,682 | |||||||||
2,636 | XenoPort, Inc.* | 112,768 | |||||||||
4,595,755 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Industrials—17.0% | |||||||||||
9,082 | AAON, Inc. | $ | 164,203 | ||||||||
7,804 | ABM Industries, Inc. | 163,416 | |||||||||
5,168 | Allegiant Travel Co.* | 140,828 | |||||||||
1,802 | Ameron International Corp. | 178,038 | |||||||||
4,931 | Astronics Corp.* | 87,772 | |||||||||
13,145 | Bowne & Co., Inc. | 218,733 | |||||||||
17,183 | CBIZ, Inc.* | 152,413 | |||||||||
15,342 | China Fire & Security Group, Inc.* | 130,407 | |||||||||
4,145 | Copa Holdings S.A., Class A (Panama) | 162,028 | |||||||||
8,086 | Cornell Cos., Inc.* | 183,714 | |||||||||
6,647 | Deluxe Corp. | 141,315 | |||||||||
5,119 | Ducommun, Inc.* | 166,777 | |||||||||
7,859 | DynCorp International, Inc., Class A* | 141,069 | |||||||||
3,473 | Esterline Technologies Corp.* | 193,307 | |||||||||
4,248 | Excel Maritime Carriers Ltd. | 168,688 | |||||||||
5,253 | Exponent, Inc.* | 177,236 | |||||||||
4,288 | FreightCar America, Inc. | 164,659 | |||||||||
13,776 | GenCorp, Inc.* | 118,060 | |||||||||
5,923 | Genesee & Wyoming, Inc., Class A* | 211,333 | |||||||||
4,627 | GeoEye, Inc.* | 106,560 | |||||||||
10,745 | GrafTech International Ltd.* | 211,139 | |||||||||
5,886 | Heidrick & Struggles International, Inc. | 176,168 | |||||||||
13,486 | Hill International, Inc.* | 194,873 | |||||||||
6,243 | ICF International, Inc.* | 111,375 | |||||||||
6,120 | Kadant, Inc.* | 159,610 | |||||||||
13,061 | Kimball International, Inc., Class B | 134,136 | |||||||||
3,513 | L.B. Foster Co., Class A* | 112,767 | |||||||||
4,383 | Layne Christensen Co.* | 187,023 | |||||||||
4,727 | Michael Baker Corp.* | 99,551 | |||||||||
14,015 | Navios Maritime Holdings, Inc. (Greece) | 154,025 | |||||||||
4,627 | Perini Corp.* | 167,405 | |||||||||
9,769 | Pike Electric Corp.* | 156,695 | |||||||||
8,710 | Polypore International, Inc.* | 203,901 | |||||||||
5,389 | Raven Industries, Inc. | 165,119 | |||||||||
9,639 | Rush Enterprises, Inc., Class A* | 155,381 | |||||||||
5,366 | Seaspan Corp. (China) | 142,628 | |||||||||
8,347 | Standard Parking Corp.* | 178,876 | |||||||||
14,076 | Taser International, Inc.* | 105,007 | |||||||||
4,857 | TBS International Ltd., Class A* | 195,154 | |||||||||
2,997 | Triumph Group, Inc. | 176,433 | |||||||||
2,925 | United Stationers, Inc.* | 128,963 | |||||||||
8,663 | Volt Information Sciences, Inc.* | 115,564 | |||||||||
17,595 | Wabash National Corp. | 147,446 | |||||||||
6,749,795 | |||||||||||
Information Technology—20.0% | |||||||||||
3,580 | Advent Software, Inc.* | 142,699 | |||||||||
6,238 | Avid Technology, Inc.* | 130,187 | |||||||||
6,021 | Blue Coat Systems, Inc.* | 127,103 | |||||||||
6,805 | Checkpoint Systems, Inc.* | 176,454 |
See Notes to Financial Statements.
76
Schedule of Investments (Continued)
PowerShares Zacks Small Cap Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
12,537 | CMGI, Inc.* | $ | 173,387 | ||||||||
10,567 | Cognex Corp. | 266,287 | |||||||||
6,042 | comScore, Inc.* | 114,013 | |||||||||
7,172 | Data Domain, Inc.* | 155,991 | |||||||||
25,347 | Dice Holdings, Inc.* | 172,867 | |||||||||
10,434 | Double-Take Software, Inc.* | 155,258 | |||||||||
12,308 | Echelon Corp.* | 138,588 | |||||||||
8,521 | ExlService Holdings, Inc.* | 214,048 | |||||||||
18,333 | FalconStor Software, Inc.* | 149,414 | |||||||||
7,137 | FEI Co.* | 156,086 | |||||||||
12,576 | Greenfield Online, Inc.* | 143,492 | |||||||||
11,545 | i2 Technologies, Inc.* | 121,223 | |||||||||
16,504 | Immersion Corp.* | 186,330 | |||||||||
8,002 | InterDigital, Inc.* | 162,201 | |||||||||
14,849 | Intevac, Inc.* | 197,195 | |||||||||
16,517 | Keynote Systems, Inc.* | 190,771 | |||||||||
18,610 | Lawson Software, Inc.* | 148,694 | |||||||||
23,068 | Limelight Networks, Inc.* | 64,129 | |||||||||
13,466 | Liquidity Services, Inc.* | 109,748 | |||||||||
13,103 | LoJack Corp.* | 129,589 | |||||||||
9,631 | Macrovision Corp.* | 151,977 | |||||||||
20,364 | Marchex, Inc., Class B | 210,360 | |||||||||
10,215 | Mellanox Technologies Ltd. (Israel)* | 152,919 | |||||||||
19,483 | Mercury Computer Systems, Inc.* | 156,254 | |||||||||
13,343 | Methode Electronics, Inc. | 144,638 | |||||||||
27,689 | Microtune, Inc.* | 97,742 | |||||||||
10,341 | Monolithic Power Systems, Inc.* | 236,808 | |||||||||
12,457 | MSC.Software Corp.* | 151,726 | |||||||||
12,277 | Multi-Fineline Electronix, Inc.* | 232,034 | |||||||||
12,664 | Oplink Communications, Inc.* | 121,701 | |||||||||
32,601 | Orbcomm, Inc.* | 192,020 | |||||||||
12,846 | PC Connection, Inc.* | 95,960 | |||||||||
11,923 | Pericom Semiconductor Corp.* | 203,168 | |||||||||
10,638 | Phoenix Technologies Ltd.* | 125,422 | |||||||||
23,037 | PLX Technology, Inc.* | 198,809 | |||||||||
19,341 | Rackable Systems, Inc.* | 212,751 | |||||||||
11,899 | Radisys Corp.* | 112,208 | |||||||||
28,568 | S1 Corp.* | 193,120 | |||||||||
8,007 | SAVVIS, Inc.* | 117,303 | |||||||||
18,068 | Secure Computing Corp.* | 119,610 | |||||||||
21,476 | Smith Micro Software, Inc.* | 185,338 | |||||||||
18,416 | SonicWALL, Inc.* | 141,619 | |||||||||
5,407 | Standard Microsystems Corp.* | 160,318 | |||||||||
10,241 | SYKES Enterprises, Inc.* | 170,205 | |||||||||
4,347 | VistaPrint Ltd. (Bermuda)* | 147,928 | |||||||||
19,272 | Wind River Systems, Inc.* | 158,801 | |||||||||
7,916,493 | |||||||||||
Materials—6.2% | |||||||||||
12,299 | Buckeye Technologies, Inc.* | 106,140 | |||||||||
11,127 | Calgon Carbon Corp.* | 158,560 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
11,184 | Glatfelter | $ | 163,175 | ||||||||
14,349 | Headwaters, Inc.* | 164,009 | |||||||||
17,387 | Hecla Mining Co.* | 178,391 | |||||||||
2,529 | Kaiser Aluminum Corp. | 173,565 | |||||||||
4,831 | Koppers Holdings, Inc. | 234,015 | |||||||||
17,351 | Landec Corp.* | 140,717 | |||||||||
18,871 | Mercer International, Inc.* | 126,624 | |||||||||
7,890 | Olin Corp. | 159,141 | |||||||||
2,816 | OM Group, Inc.* | 154,204 | |||||||||
5,656 | Rock-Tenn Co., Class A | 191,908 | |||||||||
7,931 | Schulman (A.), Inc. | 168,137 | |||||||||
6,785 | Schweitzer-Mauduit International, Inc. | 150,152 | |||||||||
13,103 | ShengdaTech, Inc.* | 101,155 | |||||||||
10,978 | Spartech Corp. | 98,143 | |||||||||
2,468,036 | |||||||||||
Telecommunication Services—0.7% | |||||||||||
11,516 | Alaska Communications Systems Group, Inc. | 128,749 | |||||||||
5,134 | Atlantic Tele-Network, Inc. | 159,821 | |||||||||
288,570 | |||||||||||
Utilities—1.3% | |||||||||||
4,817 | Laclede Group (The), Inc. | 182,179 | |||||||||
5,172 | New Jersey Resources Corp. | 164,728 | |||||||||
5,016 | WGL Holdings, Inc. | 164,525 | |||||||||
511,432 | |||||||||||
Total Common Stocks and Other Equity Interests (Cost $45,353,256) | 39,760,659 | ||||||||||
Money Market Fund—0.1% | |||||||||||
18,983 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $18,983) | 18,983 | |||||||||
Total Investments (Cost $45,372,239)—100.4% | 39,779,642 | ||||||||||
Liabilities in excess of other assets—(0.4%) | (149,860 | ) | |||||||||
Net Assets—100.0% | $ | 39,629,782 |
* Non-income producing security.
See Notes to Financial Statements.
77
Statements of Assets and Liabilities
April 30, 2008
PowerShares Dynamic Aggressive Growth Portfolio | PowerShares Dynamic Deep Value Portfolio | PowerShares Dynamic Large Cap Growth Portfolio | PowerShares Dynamic Large Cap Portfolio | PowerShares Dynamic Large Cap Value Portfolio | PowerShares Dynamic Mid Cap Growth Portfolio | PowerShares Dynamic Mid Cap Portfolio | |||||||||||||||||||||||||
ASSETS: | |||||||||||||||||||||||||||||||
Investment at value | $ | 12,833,674 | $ | 7,265,527 | $ | 665,594,407 | $ | 26,031,586 | $ | 252,325,415 | $ | 389,881,837 | $ | 25,570,600 | |||||||||||||||||
Cash | 50,648 | — | — | — | 72,978 | 193,364 | — | ||||||||||||||||||||||||
Receivables: | |||||||||||||||||||||||||||||||
Dividends | 954 | 2,581 | 488,897 | 24,204 | 302,904 | 301,398 | 11,664 | ||||||||||||||||||||||||
Shares sold | — | — | — | — | 1,933,957 | 4,452,330 | 2,561,734 | ||||||||||||||||||||||||
Expense waivers due from Adviser | — | — | 10,136 | — | — | 6,332 | — | ||||||||||||||||||||||||
Investments sold | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Total Assets | 12,885,276 | 7,268,108 | 666,093,440 | 26,055,790 | 254,635,254 | 394,835,261 | 28,143,998 | ||||||||||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||||||||||
Due to custodian | — | 84,017 | 86,550 | 73,433 | — | — | 56,188 | ||||||||||||||||||||||||
Payables: | |||||||||||||||||||||||||||||||
Investments purchased | — | — | — | — | 1,930,413 | 4,451,172 | 2,561,290 | ||||||||||||||||||||||||
Shares repurchased | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Expense recapture due to Adviser | 1,239 | 857 | — | 1,226 | 36,295 | — | 1,010 | ||||||||||||||||||||||||
Accrued advisory fees | 5,110 | 2,905 | 269,026 | 9,749 | 100,463 | 153,307 | 9,191 | ||||||||||||||||||||||||
Accrued expenses | 48,143 | 46,938 | 129,113 | 49,088 | 78,893 | 84,864 | 47,619 | ||||||||||||||||||||||||
Total Liabilities | 54,492 | 134,717 | 484,689 | 133,496 | 2,146,064 | 4,689,343 | 2,675,298 | ||||||||||||||||||||||||
NET ASSETS | $ | 12,830,784 | $ | 7,133,391 | $ | 665,608,751 | $ | 25,922,294 | $ | 252,489,190 | $ | 390,145,918 | $ | 25,468,700 | |||||||||||||||||
NET ASSETS CONSIST OF: | |||||||||||||||||||||||||||||||
Shares of beneficial interest | $ | 14,521,978 | $ | 9,199,527 | $ | 730,574,671 | $ | 27,060,744 | $ | 271,178,746 | $ | 435,073,624 | $ | 27,793,870 | |||||||||||||||||
Undistributed net investment income | — | 16,611 | 568,098 | 66,667 | 479,661 | — | 17,028 | ||||||||||||||||||||||||
Accumulated net realized loss on investments | (2,212,971 | ) | (1,974,690 | ) | (59,293,670 | ) | (954,944 | ) | (11,062,459 | ) | (51,640,876 | ) | (2,634,749 | ) | |||||||||||||||||
Net unrealized appreciation (depreciation) on investments | 521,777 | (108,057 | ) | (6,240,348 | ) | (250,173 | ) | (8,106,758 | ) | 6,713,170 | 292,551 | ||||||||||||||||||||
Net Assets | $ | 12,830,784 | $ | 7,133,391 | $ | 665,608,751 | $ | 25,922,294 | $ | 252,489,190 | $ | 390,145,918 | $ | 25,468,700 | |||||||||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 500,000 | 300,000 | 38,400,000 | 1,000,000 | 13,100,000 | 17,500,000 | 1,000,000 | ||||||||||||||||||||||||
Net asset value | $ | 25.66 | $ | 23.78 | $ | 17.33 | $ | 25.92 | $ | 19.27 | $ | 22.29 | $ | 25.47 | |||||||||||||||||
Investments at cost | $ | 12,311,897 | $ | 7,373,584 | $ | 671,834,755 | $ | 26,281,759 | $ | 260,432,173 | $ | 383,168,667 | $ | 25,278,049 |
See Notes to Financial Statements.
78
PowerShares Dynamic Mid Cap Value Portfolio | PowerShares Dynamic Small Cap Growth Portfolio | PowerShares Dynamic Small Cap Portfolio | PowerShares Dynamic Small Cap Value Portfolio | PowerShares FTSE NASDAQ Small Cap Portfolio | PowerShares Zacks Micro Cap Portfolio | PowerShares Zacks Small Cap Portfolio | |||||||||||||||||||||||||
ASSETS: | |||||||||||||||||||||||||||||||
Investment at value | $ | 79,578,417 | $ | 51,861,396 | $ | 16,363,486 | $ | 91,576,552 | $ | 2,554,201 | $ | 94,410,062 | $ | 39,779,642 | |||||||||||||||||
Cash | — | 35,025 | — | 77,877 | 6,208 | — | — | ||||||||||||||||||||||||
Receivables: | |||||||||||||||||||||||||||||||
Dividends | 66,227 | 4,736 | 7,093 | 91,421 | 759 | 39,422 | 20,274 | ||||||||||||||||||||||||
Shares sold | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Expense waivers due from Adviser | 2,935 | 7,798 | — | 1,244 | — | — | — | ||||||||||||||||||||||||
Investments sold | 1,699,572 | — | — | — | 3,088 | 4,638 | 220,182 | ||||||||||||||||||||||||
Total Assets | 81,347,151 | 51,908,955 | 16,370,579 | 91,747,094 | 2,564,256 | 94,454,122 | 40,020,098 | ||||||||||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||||||||||
Due to custodian | 189,992 | — | 194 | — | — | 47,221 | 324,323 | ||||||||||||||||||||||||
Payables: | |||||||||||||||||||||||||||||||
Investments purchased | — | — | — | — | — | 239,118 | — | ||||||||||||||||||||||||
Shares repurchased | 1,701,653 | — | — | — | — | — | — | ||||||||||||||||||||||||
Expense recapture due to Adviser | — | — | 1,074 | — | — | 2,327 | 7,187 | ||||||||||||||||||||||||
Accrued advisory fees | 33,078 | 20,893 | 6,577 | 36,501 | 1,364 | 38,578 | 16,524 | ||||||||||||||||||||||||
Accrued expenses | 42,074 | 41,812 | 49,217 | 43,867 | — | 59,351 | 42,282 | ||||||||||||||||||||||||
Total Liabilities | 1,966,797 | 62,705 | 57,062 | 80,368 | 1,364 | 386,595 | 390,316 | ||||||||||||||||||||||||
NET ASSETS | $ | 79,380,354 | $ | 51,846,250 | $ | 16,313,517 | $ | 91,666,726 | $ | 2,562,892 | $ | 94,067,527 | $ | 39,629,782 | |||||||||||||||||
NET ASSETS CONSIST OF: | |||||||||||||||||||||||||||||||
Shares of beneficial interest | $ | 99,584,892 | $ | 78,118,555 | $ | 18,574,136 | $ | 115,560,930 | $ | 2,572,381 | $ | 147,797,708 | $ | 60,087,417 | |||||||||||||||||
Undistributed net investment income | 82,617 | — | — | — | — | 571,023 | 60,388 | ||||||||||||||||||||||||
Accumulated net realized loss on investments | (15,055,798 | ) | (27,034,915 | ) | (2,564,708 | ) | (24,546,087 | ) | (90 | ) | (46,764,507 | ) | (14,925,426 | ) | |||||||||||||||||
Net unrealized appreciation (depreciation) on investments | (5,231,357 | ) | 762,610 | 304,089 | 651,883 | (9,399 | ) | (7,536,697 | ) | (5,592,597 | ) | ||||||||||||||||||||
Net Assets | $ | 79,380,354 | $ | 51,846,250 | $ | 16,313,517 | $ | 91,666,726 | $ | 2,562,892 | $ | 94,067,527 | $ | 39,629,782 | |||||||||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 4,700,000 | 3,300,000 | 700,000 | 5,800,000 | 100,000 | 6,900,000 | 1,700,000 | ||||||||||||||||||||||||
Net asset value | $ | 16.89 | $ | 15.71 | $ | 23.31 | $ | 15.80 | $ | 25.63 | $ | 13.63 | $ | 23.31 | |||||||||||||||||
Investments at cost | $ | 84,809,774 | $ | 51,098,786 | $ | 16,059,397 | $ | 90,924,669 | $ | 2,563,600 | $ | 101,946,759 | $ | 45,372,239 |
79
Statements of Operations
PowerShares Dynamic Aggressive Growth Portfolio | PowerShares Dynamic Deep Value Portfolio | PowerShares Dynamic Large Cap Growth Portfolio | PowerShares Dynamic Large Cap Portfolio | PowerShares Dynamic Large Cap Value Portfolio | PowerShares Dynamic Mid Cap Growth Portfolio | PowerShares Dynamic Mid Cap Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | |||||||||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||||||||||
Unaffiliated dividend income | $ | 28,479 | $ | 267,530 | $ | 5,238,330 | $ | 279,364 | $ | 7,361,043 | $ | 1,965,036 | $ | 195,048 | |||||||||||||||||
Affiliated money market dividend income | 31 | 2,624 | 14,957 | 1,916 | 8,977 | — | 1,787 | ||||||||||||||||||||||||
Foreign withholding tax | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Total Income | 28,510 | 270,154 | 5,253,287 | 281,280 | 7,370,020 | 1,965,036 | 196,835 | ||||||||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||||||||||
Advisory fees | 50,243 | 64,303 | 2,635,464 | 79,933 | 1,330,936 | 1,580,803 | 85,031 | ||||||||||||||||||||||||
Administration & Accounting fees | 80,965 | 80,861 | 148,869 | 80,928 | 80,738 | 96,935 | 80,954 | ||||||||||||||||||||||||
Offering costs | 20,908 | 22,493 | — | 13,427 | — | — | 14,038 | ||||||||||||||||||||||||
Audit | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | ||||||||||||||||||||||||
Professional tax review | 10,464 | 10,464 | 11,072 | 10,464 | 11,072 | 11,072 | 10,464 | ||||||||||||||||||||||||
Custodian & transfer agent fees | 6,500 | 6,479 | 30,273 | 6,492 | 17,614 | 19,746 | 6,498 | ||||||||||||||||||||||||
Sub-licensing | 5,024 | 6,430 | 158,128 | 7,993 | 79,856 | 94,848 | 8,503 | ||||||||||||||||||||||||
Trustees | 4,778 | 4,851 | 17,309 | 4,899 | 11,676 | 12,536 | 4,897 | ||||||||||||||||||||||||
Listing fee and expenses | 21 | 27 | 10,542 | 20 | 10,533 | 10,346 | 21 | ||||||||||||||||||||||||
Printing | — | — | 77,835 | 495 | — | 45,969 | 618 | ||||||||||||||||||||||||
Registration & filings | — | 4 | 9,000 | 185 | — | 4,394 | 178 | ||||||||||||||||||||||||
Legal | — | — | 14,534 | — | 7,906 | 8,753 | — | ||||||||||||||||||||||||
Other expenses | 484 | 724 | 14,755 | 497 | 15,085 | 10,431 | 514 | ||||||||||||||||||||||||
Total Expenses | 195,235 | 212,484 | 3,143,629 | 221,181 | 1,581,264 | 1,911,681 | 227,564 | ||||||||||||||||||||||||
(Waivers) and/or Recapture | (109,011 | ) | (106,397 | ) | 177,056 | (103,842 | ) | 95,715 | 80,131 | (102,985 | ) | ||||||||||||||||||||
Net Expenses | 86,224 | 106,087 | 3,320,685 | 117,339 | 1,676,979 | 1,991,812 | 124,579 | ||||||||||||||||||||||||
Net Investment Income (Loss) | (57,714 | ) | 164,067 | 1,932,602 | 163,941 | 5,693,041 | (26,776 | ) | 72,256 | ||||||||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||||||||||||||||||
Net realized gain (loss) from: | |||||||||||||||||||||||||||||||
Investments | (2,012,817 | ) | (1,925,476 | ) | (45,619,911 | ) | (937,749 | ) | (9,433,763 | ) | (40,640,690 | ) | (2,568,034 | ) | |||||||||||||||||
In-kind redemptions | 2,081,125 | 1,099,226 | 41,084,974 | 785,174 | 19,798,746 | 48,179,826 | 1,604,521 | ||||||||||||||||||||||||
Net realized gain (loss) | 68,308 | (826,250 | ) | (4,534,937 | ) | (152,575 | ) | 10,364,983 | 7,539,136 | (963,513 | ) | ||||||||||||||||||||
Net change in unrealized appreciation (depreciation) on investments | (109,999 | ) | (622,871 | ) | (26,766,279 | ) | (886,410 | ) | (29,643,000 | ) | (11,401,604 | ) | (474,721 | ) | |||||||||||||||||
Net realized and unrealized loss on investments | (41,691 | ) | (1,449,121 | ) | (31,301,216 | ) | (1,038,985 | ) | (19,278,017 | ) | (3,862,468 | ) | (1,438,234 | ) | |||||||||||||||||
Net decrease in net assets resulting from operations | $ | (99,405 | ) | $ | (1,285,054 | ) | $ | (29,368,614 | ) | $ | (875,044 | ) | $ | (13,584,976 | ) | $ | (3,889,244 | ) | $ | (1,365,978 | ) |
* Commencement of Investment Operations.
See Notes to Financial Statements.
80
PowerShares Dynamic Mid Cap Value Portfolio | PowerShares Dynamic Small Cap Growth Portfolio | PowerShares Dynamic Small Cap Portfolio | PowerShares Dynamic Small Cap Value Portfolio | PowerShares FTSE NASDAQ Small Cap Portfolio | PowerShares Zacks Micro Cap Portfolio | PowerShares Zacks Small Cap Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | For the Period April 1, 2008* Through April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | |||||||||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||||||||||
Unaffiliated dividend income | $ | 1,819,164 | $ | 211,836 | $ | 97,626 | $ | 1,654,066 | $ | 1,190 | $ | 2,473,941 | $ | 837,518 | |||||||||||||||||
Affiliated money market dividend income | 3,462 | — | 1,919 | 5,290 | — | 12,822 | 11,590 | ||||||||||||||||||||||||
Foreign withholding tax | — | — | (21 | ) | (648 | ) | — | (4,474 | ) | (478 | ) | ||||||||||||||||||||
Total Income | 1,822,626 | 211,836 | 99,524 | 1,658,708 | 1,190 | 2,482,289 | 848,630 | ||||||||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||||||||||
Advisory fees | 515,440 | 297,220 | 47,107 | 539,511 | 1,364 | 733,323 | 280,863 | ||||||||||||||||||||||||
Administration & Accounting fees | 80,738 | 80,737 | 80,977 | 80,738 | — | 80,738 | 80,738 | ||||||||||||||||||||||||
Offering costs | — | — | 13,425 | — | — | — | — | ||||||||||||||||||||||||
Audit | 15,848 | 15,848 | 15,848 | 15,848 | — | 15,848 | 15,848 | ||||||||||||||||||||||||
Professional tax review | 11,072 | 11,072 | 10,464 | 11,072 | — | 11,072 | 10,914 | ||||||||||||||||||||||||
Custodian & transfer agent fees | 8,648 | 7,104 | 7,334 | 9,600 | — | 13,472 | 8,043 | ||||||||||||||||||||||||
Sub-licensing | 30,926 | 17,833 | 4,711 | 32,371 | — | 146,665 | 56,173 | ||||||||||||||||||||||||
Trustees | 7,480 | 6,047 | 4,694 | 7,574 | — | 8,818 | 6,127 | ||||||||||||||||||||||||
Listing fee and expenses | 10,196 | 10,115 | 19 | 10,209 | — | 9,322 | 116 | ||||||||||||||||||||||||
Printing | 7,427 | 6,880 | — | 5,531 | — | 13,469 | — | ||||||||||||||||||||||||
Registration & filings | 120 | — | 9 | — | — | — | — | ||||||||||||||||||||||||
Legal | 3,829 | 1,550 | — | 3,877 | — | 5,883 | 2,228 | ||||||||||||||||||||||||
Other expenses | 5,027 | 2,819 | 369 | 6,971 | — | 8,840 | 5,971 | ||||||||||||||||||||||||
Total Expenses | 696,751 | 457,225 | 184,957 | 723,302 | 1,364 | 1,047,450 | 467,021 | ||||||||||||||||||||||||
(Waivers) and/or Recapture | (47,297 | ) | (82,728 | ) | (110,293 | ) | (43,517 | ) | — | (20,797 | ) | (73,796 | ) | ||||||||||||||||||
Net Expenses | 649,454 | 374,497 | 74,664 | 679,785 | 1,364 | 1,026,653 | 393,225 | ||||||||||||||||||||||||
Net Investment Income (Loss) | 1,173,172 | (162,661 | ) | 24,860 | 978,923 | (174 | ) | 1,455,636 | 455,405 | ||||||||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||||||||||||||||||
Net realized gain (loss) from: | |||||||||||||||||||||||||||||||
Investments | (11,379,214 | ) | (10,575,049 | ) | (2,148,504 | ) | (17,411,290 | ) | (90 | ) | (25,417,614 | ) | (8,353,227 | ) | |||||||||||||||||
In-kind redemptions | 7,341,977 | 4,113,721 | 1,258,403 | 5,725,452 | — | 3,507,802 | 7,519,841 | ||||||||||||||||||||||||
Net realized gain (loss) | (4,037,237 | ) | (6,461,328 | ) | (890,101 | ) | (11,685,838 | ) | (90 | ) | (21,909,812 | ) | (833,386 | ) | |||||||||||||||||
Net change in unrealized appreciation (depreciation) on investments | (15,255,358 | ) | (3,893,759 | ) | 15,596 | (4,447,006 | ) | (9,399 | ) | (20,949,782 | ) | (7,926,121 | ) | ||||||||||||||||||
Net realized and unrealized loss on investments | (19,292,595 | ) | (10,355,087 | ) | (874,505 | ) | (16,132,844 | ) | (9,489 | ) | (42,859,594 | ) | (8,759,507 | ) | |||||||||||||||||
Net decrease in net assets resulting from operations | $ | (18,119,423 | ) | $ | (10,517,748 | ) | $ | (849,645 | ) | $ | (15,153,921 | ) | $ | (9,663 | ) | $ | (41,403,958 | ) | $ | (8,304,102 | ) |
81
Statements of Changes in Net Assets
PowerShares Dynamic Aggressive Growth Portfolio | PowerShares Dynamic Deep Value Portfolio | PowerShares Dynamic Large Cap Growth Portfolio | |||||||||||||||||||||||||
Year Ended | For the Period December 20, 2006* Through | Year Ended | For the Period December 20, 2006* Through | Year Ended | Year Ended | ||||||||||||||||||||||
April 30, 2008 | April 30, 2007 | April 30, 2008 | April 30, 2007 | April 30, 2008 | April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | (57,714 | ) | $ | (22,598 | ) | $ | 164,067 | $ | 131,829 | $ | 1,932,602 | $ | 240,165 | |||||||||||||
Net realized gain (loss) on investments | 68,308 | 205,154 | (826,250 | ) | 234,101 | (4,534,937 | ) | (286,076 | ) | ||||||||||||||||||
Net change in unrealized appreciation (depreciation) of investments | (109,999 | ) | 631,776 | (622,871 | ) | 514,814 | (26,766,279 | ) | 16,420,488 | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (99,405 | ) | 814,332 | (1,285,054 | ) | 880,744 | (29,368,614 | ) | 16,374,577 | ||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | (24,237 | ) | 3,814 | (10,696 | ) | 1,491 | 458,077 | 32,897 | |||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | — | — | (236,479 | ) | (43,560 | ) | (1,364,504 | ) | (240,165 | ) | |||||||||||||||||
Return of capital | — | — | — | — | — | (3,527 | ) | ||||||||||||||||||||
Total distributions to shareholders | — | — | (236,479 | ) | (43,560 | ) | (1,364,504 | ) | (243,692 | ) | |||||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 26,499,474 | 19,881,714 | 12,669,700 | 19,997,872 | 939,470,060 | 289,938,897 | |||||||||||||||||||||
Value of shares repurchased | (24,120,991 | ) | (10,144,340 | ) | (19,800,394 | ) | (5,049,438 | ) | (520,725,740 | ) | (177,221,894 | ) | |||||||||||||||
Net income equalization | 24,237 | (3,814 | ) | 10,696 | (1,491 | ) | (458,077 | ) | (32,897 | ) | |||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 2,402,720 | 9,733,560 | (7,119,998 | ) | 14,946,943 | 418,286,243 | 112,684,106 | ||||||||||||||||||||
Increase (Decrease) in Net Assets | 2,279,078 | 10,551,706 | (8,652,227 | ) | 15,785,618 | 388,011,202 | 128,847,888 | ||||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 10,551,706 | — | 15,785,618 | — | 277,597,549 | 148,749,661 | |||||||||||||||||||||
End of period | $ | 12,830,784 | $ | 10,551,706 | $ | 7,133,391 | $ | 15,785,618 | $ | 665,608,751 | $ | 277,597,549 | |||||||||||||||
Undistributed net investment income at end of period | $ | — | $ | — | $ | 16,611 | $ | 88,918 | $ | 568,098 | $ | — | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 1,000,000 | 800,000 | 500,000 | 800,000 | 51,900,000 | 17,800,000 | |||||||||||||||||||||
Shares repurchased | (900,000 | ) | (400,000 | ) | (800,000 | ) | (200,000 | ) | (29,400,000 | ) | (11,000,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 400,000 | — | 600,000 | — | 15,900,000 | 9,100,000 | |||||||||||||||||||||
Shares outstanding, end of period | 500,000 | 400,000 | 300,000 | 600,000 | 38,400,000 | 15,900,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
82
PowerShares Dynamic Large Cap Portfolio | PowerShares Dynamic Large Cap Value Portfolio | PowerShares Dynamic Mid Cap Growth Portfolio | |||||||||||||||||||||||||
Year Ended | For the Period December 1, 2006* Through | Year Ended | Year Ended | Year Ended | Year Ended | ||||||||||||||||||||||
April 30, 2008 | April 30, 2007 | April 30, 2008 | April 30, 2007 | April 30, 2008 | April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | 163,941 | $ | 64,349 | $ | 5,693,041 | $ | 5,109,774 | $ | (26,776 | ) | $ | (173,222 | ) | |||||||||||||
Net realized gain (loss) on investments | (152,575 | ) | 265,497 | 10,364,983 | 24,650,239 | 7,539,136 | 2,676,199 | ||||||||||||||||||||
Net change in unrealized appreciation (depreciation) of investments | (886,410 | ) | 636,237 | (29,643,000 | ) | 16,864,450 | (11,401,604 | ) | 13,821,191 | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (875,044 | ) | 966,083 | (13,584,976 | ) | 46,624,463 | (3,889,244 | ) | 16,324,168 | ||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 36,730 | (6,528 | ) | (32,015 | ) | 339,753 | (171,856 | ) | 117,894 | ||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (115,860 | ) | (45,948 | ) | (6,461,590 | ) | (3,984,387 | ) | — | (711,633 | ) | ||||||||||||||||
Return of capital | — | — | — | — | (35,820 | ) | (9,929 | ) | |||||||||||||||||||
Total distributions to shareholders | (115,860 | ) | (45,948 | ) | (6,461,590 | ) | (3,984,387 | ) | (35,820 | ) | (721,562 | ) | |||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 29,568,161 | 20,205,371 | 182,775,903 | 482,570,049 | 637,177,664 | 199,694,174 | |||||||||||||||||||||
Value of shares repurchased | (13,453,440 | ) | (10,327,029 | ) | (202,370,045 | ) | (323,612,201 | ) | (432,900,741 | ) | (128,827,369 | ) | |||||||||||||||
Net income equalization | (36,730 | ) | 6,528 | 32,015 | (339,753 | ) | 171,856 | (117,894 | ) | ||||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 16,077,991 | 9,884,870 | (19,562,127 | ) | 158,618,095 | 204,448,779 | 70,748,911 | ||||||||||||||||||||
Increase (Decrease) in Net Assets | 15,123,817 | 10,798,477 | (39,640,708 | ) | 201,597,924 | 200,351,859 | 86,469,411 | ||||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 10,798,477 | — | 292,129,898 | 90,531,974 | 189,794,059 | 103,324,648 | |||||||||||||||||||||
End of period | $ | 25,922,294 | $ | 10,798,477 | $ | 252,489,190 | $ | 292,129,898 | $ | 390,145,918 | $ | 189,794,059 | |||||||||||||||
Undistributed net investment income at end of period | $ | 66,667 | $ | 18,586 | $ | 479,661 | $ | 1,248,210 | $ | — | $ | — | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 1,100,000 | 800,000 | 9,100,000 | 25,900,000 | 27,800,000 | 10,400,000 | |||||||||||||||||||||
Shares repurchased | (500,000 | ) | (400,000 | ) | (10,100,000 | ) | (17,000,000 | ) | (19,300,000 | ) | (6,900,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 400,000 | — | 14,100,000 | 5,200,000 | 9,000,000 | 5,500,000 | |||||||||||||||||||||
Shares outstanding, end of period | 1,000,000 | 400,000 | 13,100,000 | 14,100,000 | 17,500,000 | 9,000,000 |
83
Statements of Changes in Net Assets (Continued)
PowerShares Dynamic Mid Cap Portfolio | PowerShares Dynamic Mid Cap Value Portfolio | PowerShares Dynamic Small Cap Growth Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | For the Period December 1, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | 72,256 | $ | 50,583 | $ | 1,173,172 | $ | 1,145,574 | $ | (162,661 | ) | $ | (210,147 | ) | |||||||||||||
Net realized gain (loss) on investments | (963,513 | ) | 594,502 | (4,037,237 | ) | 4,692,328 | (6,461,328 | ) | (3,356,204 | ) | |||||||||||||||||
Net change in unrealized appreciation (depreciation) of investments | (474,721 | ) | 767,272 | (15,255,358 | ) | 7,757,823 | (3,893,759 | ) | (1,366,638 | ) | |||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (1,365,978 | ) | 1,412,357 | (18,119,423 | ) | 13,595,725 | (10,517,748 | ) | (4,932,989 | ) | |||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | (4,238 | ) | (1,941 | ) | 260 | 54,435 | (6,069 | ) | (92,734 | ) | |||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (71,701 | ) | (34,110 | ) | (1,388,612 | ) | (891,950 | ) | — | — | |||||||||||||||||
Return of capital | — | — | — | — | — | — | |||||||||||||||||||||
Total distributions to shareholders | (71,701 | ) | (34,110 | ) | (1,388,612 | ) | (891,950 | ) | — | — | |||||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 34,432,643 | 23,082,797 | 137,259,549 | 136,706,085 | 125,298,871 | 98,612,408 | |||||||||||||||||||||
Value of shares repurchased | (18,716,682 | ) | (13,270,626 | ) | (147,727,489 | ) | (96,868,606 | ) | (124,281,604 | ) | (150,797,541 | ) | |||||||||||||||
Net income equalization | 4,238 | 1,941 | (260 | ) | (54,435 | ) | 6,069 | 92,734 | |||||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 15,720,199 | 9,814,112 | (10,468,200 | ) | 39,783,044 | 1,023,336 | (52,092,399 | ) | |||||||||||||||||||
Increase (Decrease) in Net Assets | 14,278,282 | 11,190,418 | (29,975,975 | ) | 52,541,254 | (9,500,481 | ) | (57,118,122 | ) | ||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 11,190,418 | — | 109,356,329 | 56,815,075 | 61,346,731 | 118,464,853 | |||||||||||||||||||||
End of period | $ | 25,468,700 | $ | 11,190,418 | $ | 79,380,354 | $ | 109,356,329 | $ | 51,846,250 | $ | 61,346,731 | |||||||||||||||
Undistributed net investment income at end of period | $ | 17,028 | $ | 16,473 | $ | 82,617 | $ | 298,057 | $ | — | $ | — | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 1,300,000 | 900,000 | 7,100,000 | 7,500,000 | 7,300,000 | 5,700,000 | |||||||||||||||||||||
Shares repurchased | (700,000 | ) | (500,000 | ) | (7,800,000 | ) | (5,400,000 | ) | (7,300,000 | ) | (8,800,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 400,000 | — | 5,400,000 | 3,300,000 | 3,300,000 | 6,400,000 | |||||||||||||||||||||
Shares outstanding, end of period | 1,000,000 | 400,000 | 4,700,000 | 5,400,000 | 3,300,000 | 3,300,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
84
PowerShares Dynamic Small Cap Portfolio | PowerShares Dynamic Small Cap Value Portfolio | PowerShares FTSE NASDAQ Small Cap Portfolio | |||||||||||||||||||||
Year Ended April 30, 2008 | For the Period December 1, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | For the Period April 1, 2008* Through April 30, 2008 | |||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||
Net investment income (loss) | $ | 24,860 | $ | 2,160 | $ | 978,923 | $ | 575,488 | $ | (174 | ) | ||||||||||||
Net realized gain (loss) on investments | (890,101 | ) | 353,397 | (11,685,838 | ) | 6,596,561 | (90 | ) | |||||||||||||||
Net change in unrealized appreciation (depreciation) of investments | 15,596 | 288,493 | (4,447,006 | ) | 1,084,508 | (9,399 | ) | ||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (849,645 | ) | 644,050 | (15,153,921 | ) | 8,256,557 | (9,663 | ) | |||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 21,115 | (1,680 | ) | (190,409 | ) | 48,335 | — | ||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||
Net investment income | (24,996 | ) | (1,164 | ) | (1,007,247 | ) | (591,897 | ) | — | ||||||||||||||
Return of capital | (66,108 | ) | — | (2,478,948 | ) | — | — | ||||||||||||||||
Total distributions to shareholders | (91,104 | ) | (1,164 | ) | (3,486,195 | ) | (591,897 | ) | — | ||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||
Proceeds from shares sold | 19,213,060 | 20,297,119 | 158,114,517 | 136,778,591 | 2,572,555 | ||||||||||||||||||
Value of shares repurchased | (9,963,930 | ) | (12,934,869 | ) | (165,487,537 | ) | (93,102,785 | ) | — | ||||||||||||||
Net income equalization | (21,115 | ) | 1,680 | 190,409 | (48,335 | ) | — | ||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 9,228,015 | 7,363,930 | (7,182,611 | ) | 43,627,471 | 2,572,555 | |||||||||||||||||
Increase (Decrease) in Net Assets | 8,308,381 | 8,005,136 | (26,013,136 | ) | 51,340,466 | 2,562,892 | |||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||
Beginning of period | 8,005,136 | — | 117,679,862 | 66,339,396 | — | ||||||||||||||||||
End of period | $ | 16,313,517 | $ | 8,005,136 | $ | 91,666,726 | $ | 117,679,862 | $ | 2,562,892 | |||||||||||||
Undistributed net investment income at end of period | $ | — | $ | 193 | $ | — | $ | 25,537 | $ | — | |||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||
Shares sold | 800,000 | 800,000 | 9,200,000 | 7,800,000 | 100,000 | ||||||||||||||||||
Shares repurchased | (400,000 | ) | (500,000 | ) | (9,700,000 | ) | (5,400,000 | ) | — | ||||||||||||||
Shares outstanding, beginning of period | 300,000 | — | 6,300,000 | 3,900,000 | — | ||||||||||||||||||
Shares outstanding, end of period | 700,000 | 300,000 | 5,800,000 | 6,300,000 | 100,000 |
85
Statements of Changes in Net Assets (Continued)
PowerShares Zacks Micro Cap Portfolio | PowerShares Zacks Small Cap Portfolio | ||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||
OPERATIONS: | |||||||||||||||||||
Net investment income (loss) | $ | 1,455,636 | $ | 577,806 | $ | 455,405 | $ | 121,243 | |||||||||||
Net realized gain (loss) on investments | (21,909,812 | ) | 6,289,128 | (833,386 | ) | 1,615,443 | |||||||||||||
Net change in unrealized appreciation (depreciation) of investments | (20,949,782 | ) | 1,294,918 | (7,926,121 | ) | (234,214 | ) | ||||||||||||
Net increase (decrease) in net assets resulting from operations | (41,403,958 | ) | 8,161,852 | (8,304,102 | ) | 1,502,472 | |||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | (221,325 | ) | 53,014 | (96,877 | ) | 7,230 | |||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||
Net investment income | (1,084,217 | ) | (206,496 | ) | (359,366 | ) | (126,531 | ) | |||||||||||
Return of capital | — | — | — | (10,819 | ) | ||||||||||||||
Total distributions to shareholders | (1,084,217 | ) | (206,496 | ) | (359,366 | ) | (137,350 | ) | |||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||
Proceeds from shares sold | 135,042,430 | 139,710,391 | 69,573,912 | 82,223,254 | |||||||||||||||
Value of shares repurchased | (190,796,918 | ) | (114,331,138 | ) | (92,810,601 | ) | (70,924,589 | ) | |||||||||||
Net income equalization | 221,325 | (53,014 | ) | 96,877 | (7,230 | ) | |||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | (55,533,163 | ) | 25,326,239 | (23,139,812 | ) | 11,291,435 | |||||||||||||
Increase (Decrease) in Net Assets | (98,242,663 | ) | 33,334,609 | (31,900,157 | ) | 12,663,787 | |||||||||||||
NET ASSETS: | |||||||||||||||||||
Beginning of period | 192,310,190 | 158,975,581 | 71,529,939 | 58,866,152 | |||||||||||||||
End of period | $ | 94,067,527 | $ | 192,310,190 | $ | 39,629,782 | $ | 71,529,939 | |||||||||||
Undistributed net investment income at end of period | $ | 571,023 | $ | 257,890 | $ | 60,388 | $ | — | |||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||
Shares sold | 8,300,000 | 8,100,000 | 2,600,000 | 3,100,000 | |||||||||||||||
Shares repurchased | (11,900,000 | ) | (6,700,000 | ) | (3,500,000 | ) | (2,700,000 | ) | |||||||||||
Shares outstanding, beginning of period | 10,500,000 | 9,100,000 | 2,600,000 | 2,200,000 | |||||||||||||||
Shares outstanding, end of period | 6,900,000 | 10,500,000 | 1,700,000 | 2,600,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
86
Financial Highlights
PowerShares Dynamic Aggressive Growth Portfolio
Year Ended April 30, 2008 | For the Period December 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 26.38 | $ | 24.86 | |||||||
Net investment loss** | (0.15 | ) | (0.05 | ) | |||||||
Net realized and unrealized gain (loss) on investments | (0.57 | ) | 1.57 | ||||||||
Total from operations | (0.72 | ) | 1.52 | ||||||||
Net asset value at end of period | $ | 25.66 | $ | 26.38 | |||||||
TOTAL RETURN*** | (2.73 | )% | 6.11 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 12,831 | $ | 10,552 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.86 | % | 0.75 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.94 | % | 1.76 | %† | |||||||
Net investment loss, after Waivers and/or Recapture | (0.57 | )% | (0.50 | )%† | |||||||
Portfolio turnover rate †† | 94 | % | 11 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.06 | ) | $ | 0.01 |
PowerShares Dynamic Deep Value Portfolio
Year Ended April 30, 2008 | For the Period December 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 26.31 | $ | 24.99 | |||||||
Net investment income** | 0.32 | 0.22 | |||||||||
Net realized and unrealized gain (loss) on investments | (2.41 | ) | 1.17 | ||||||||
Total from operations | (2.09 | ) | 1.39 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.44 | ) | (0.07 | ) | |||||||
Net asset value at end of period | $ | 23.78 | $ | 26.31 | |||||||
TOTAL RETURN*** | (8.05 | )% | 5.59 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 7,133 | $ | 15,786 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.82 | % | 0.74 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.65 | % | 1.55 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 1.28 | % | 2.40 | %† | |||||||
Portfolio turnover rate †† | 100 | % | 7 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.02 | ) | $ | — | (a) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
87
Financial Highlights (Continued)
PowerShares Dynamic Large Cap Growth Portfolio
Year Ended April 30, | For the Period March 3, 2005* Through | ||||||||||||||||||
2008 | 2007 | 2006 | April 30, 2005 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||||||
Net asset value at beginning of period | $ | 17.46 | $ | 16.35 | $ | 14.11 | $ | 14.83 | |||||||||||
Net investment income (loss)** | 0.07 | 0.02 | (0.01 | ) | — | (a) | |||||||||||||
Net realized and unrealized gain (loss) on investments | (0.16 | ) | 1.11 | 2.25 | (0.72 | ) | |||||||||||||
Total from operations | (0.09 | ) | 1.13 | 2.24 | (0.72 | ) | |||||||||||||
Distributions to shareholders from: | |||||||||||||||||||
Net investment income | (0.04 | ) | (0.02 | ) | — | (a) | — | ||||||||||||
Return of capital | — | — | (a) | — | — | ||||||||||||||
Total distributions | (0.04 | ) | (0.02 | ) | — | — | |||||||||||||
Net asset value at end of period | $ | 17.33 | $ | 17.46 | $ | 16.35 | $ | 14.11 | |||||||||||
TOTAL RETURN*** | (0.56 | )% | 6.92 | % | 15.89 | % | (4.87 | )% | |||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||
Net assets at end of period (000's omitted) | $ | 665,609 | $ | 277,598 | $ | 148,750 | $ | 8,467 | |||||||||||
Ratio to average net assets of: | |||||||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.64 | % | 0.63 | %† | |||||||||||
Expenses, prior to Waivers and/or Recapture | 0.60 | % | 0.68 | % | 0.80 | % | 2.45 | %† | |||||||||||
Net investment income (loss), after Waivers and/or Recapture | 0.37 | % | 0.13 | % | (0.04 | )% | 0.13 | %† | |||||||||||
Portfolio turnover rate †† | 46 | % | 57 | % | 73 | % | 2 | % | |||||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.02 | $ | — | (a) | — | — |
PowerShares Dynamic Large Cap Portfolio
Year Ended April 30, 2008 | For the Period December 1, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 27.00 | $ | 25.18 | |||||||
Net investment income** | 0.27 | 0.12 | |||||||||
Net realized and unrealized gain (loss) on investments | (1.14 | ) | 1.78 | ||||||||
Total from operations | (0.87 | ) | 1.90 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.21 | ) | (0.08 | ) | |||||||
Net asset value at end of period | $ | 25.92 | $ | 27.00 | |||||||
TOTAL RETURN*** | (3.26 | )% | 7.55 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 25,922 | $ | 10,798 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.73 | % | 0.74 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.38 | % | 1.45 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 1.03 | % | 1.05 | %† | |||||||
Portfolio turnover rate †† | 49 | % | 3 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | 0.06 | $ | (0.01 | ) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
88
Financial Highlights (Continued)
PowerShares Dynamic Large Cap Value Portfolio
Year Ended April 30, | For the Period March 3, 2005* Through | ||||||||||||||||||
2008 | 2007 | 2006 | April 30, 2005 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||||||
Net asset value at beginning of period | $ | 20.72 | $ | 17.41 | $ | 14.52 | $ | 15.00 | |||||||||||
Net investment income** | 0.43 | 0.39 | 0.28 | 0.05 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (1.40 | ) | 3.21 | 2.85 | (0.52 | ) | |||||||||||||
Total from operations | (0.97 | ) | 3.60 | 3.13 | (0.47 | ) | |||||||||||||
Distributions to shareholders from: | |||||||||||||||||||
Net investment income | (0.48 | ) | (0.29 | ) | (0.24 | ) | (0.01 | ) | |||||||||||
Net asset value at end of period | $ | 19.27 | $ | 20.72 | $ | 17.41 | $ | 14.52 | |||||||||||
TOTAL RETURN*** | (4.78 | )% | 20.85 | % | 21.71 | % | (3.11 | )% | |||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||
Net assets at end of period (000's omitted) | $ | 252,489 | $ | 292,130 | $ | 90,532 | $ | 10,166 | |||||||||||
Ratio to average net assets of: | |||||||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.65 | % | 0.63 | %† | |||||||||||
Expenses, prior to Waivers and/or Recapture | 0.59 | % | 0.67 | % | 0.94 | % | 2.16 | %† | |||||||||||
Net investment income, after Waivers and/or Recapture | 2.14 | % | 2.00 | % | 1.75 | % | 1.99 | %† | |||||||||||
Portfolio turnover rate †† | 22 | % | 16 | % | 29 | % | 0 | % | |||||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | — | (a) | $ | 0.03 | — | — |
PowerShares Dynamic Mid Cap Growth Portfolio
Year Ended April 30, | For the Period March 3, 2005* Through | ||||||||||||||||||
2008 | 2007 | 2006 | April 30, 2005 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||||||
Net asset value at beginning of period | $ | 21.09 | $ | 18.79 | $ | 13.92 | $ | 15.01 | |||||||||||
Net investment income (loss)** | — | (a) | (0.03 | ) | 0.28 | (0.01 | ) | ||||||||||||
Net realized and unrealized gain (loss) on investments | 1.20 | 2.44 | 4.59 | (1.08 | ) | ||||||||||||||
Total from operations | 1.20 | 2.41 | 4.87 | (1.09 | ) | ||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||
Net investment income | — | (0.11 | ) | — | — | ||||||||||||||
Return of capital | — | (a) | — | (a) | — | — | |||||||||||||
Total distributions | — | (0.11 | ) | — | — | ||||||||||||||
Net asset value at end of period | $ | 22.29 | $ | 21.09 | $ | 18.79 | $ | 13.92 | |||||||||||
TOTAL RETURN*** | 5.70 | % | 12.91 | % | 34.99 | % | (7.30 | )% | |||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||
Net assets at end of period (000's omitted) | $ | 390,146 | $ | 189,794 | $ | 103,325 | $ | 8,349 | |||||||||||
Ratio to average net assets of: | |||||||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.65 | % | 0.63 | %† | |||||||||||
Expenses, prior to Waivers and/or Recapture | 0.60 | % | 0.73 | % | 0.90 | % | 2.45 | %† | |||||||||||
Net investment income (loss), after Waivers and/or Recapture | (0.01 | )% | (0.15 | )% | 1.56 | % | (0.20 | )%† | |||||||||||
Portfolio turnover rate †† | 80 | % | 69 | % | 86 | % | 1 | % | |||||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.01 | ) | $ | 0.02 | — | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
89
Financial Highlights (Continued)
PowerShares Dynamic Mid Cap Portfolio
Year Ended April 30, 2008 | For the Period December 1, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 27.98 | $ | 25.26 | |||||||
Net investment income** | 0.11 | 0.10 | |||||||||
Net realized and unrealized gain (loss) on investments | (2.49 | ) | 2.68 | ||||||||
Total from operations | (2.38 | ) | 2.78 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.13 | ) | (0.06 | ) | |||||||
Net asset value at end of period | $ | 25.47 | $ | 27.98 | |||||||
TOTAL RETURN*** | (8.54 | )% | 11.04 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 25,469 | $ | 11,190 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.73 | % | 0.74 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.34 | % | 1.55 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.42 | % | 0.91 | %† | |||||||
Portfolio turnover rate †† | 99 | % | 7 | % | |||||||
Undistributed net investment loss included in price of units issued and redeemed**# | $ | (0.01 | ) | $ | — | (a) |
PowerShares Dynamic Mid Cap Value Portfolio
Year Ended April 30, | For the Period March 3, 2005* Through | ||||||||||||||||||
2008 | 2007 | 2006 | April 30, 2005 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||||||
Net asset value at beginning of period | $ | 20.25 | $ | 17.22 | $ | 14.47 | $ | 15.10 | |||||||||||
Net investment income** | 0.22 | 0.29 | 0.22 | 0.15 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (3.32 | ) | 2.97 | 2.78 | (0.76 | ) | |||||||||||||
Total from operations | (3.10 | ) | 3.26 | 3.00 | (0.61 | ) | |||||||||||||
Distributions to shareholders from: | |||||||||||||||||||
Net investment income | (0.26 | ) | (0.23 | ) | (0.25 | ) | (0.02 | ) | |||||||||||
Net asset value at end of period | $ | 16.89 | $ | 20.25 | $ | 17.22 | $ | 14.47 | |||||||||||
TOTAL RETURN*** | (15.47 | )% | 19.14 | % | 20.85 | % | (4.07 | )% | |||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||
Net assets at end of period (000's omitted) | $ | 79,380 | $ | 109,356 | $ | 56,815 | $ | 10,126 | |||||||||||
Ratio to average net assets of: | |||||||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.67 | % | 0.63 | %† | |||||||||||
Expenses, prior to Waivers and/or Recapture | 0.68 | % | 0.82 | % | 1.13 | % | 2.14 | %† | |||||||||||
Net investment income, after Waivers and/or Recapture | 1.14 | % | 1.64 | % | 1.33 | % | 6.34 | %† | |||||||||||
Portfolio turnover rate †† | 53 | % | 43 | % | 117 | % | 1 | % | |||||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | — | (a) | $ | 0.01 | — | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
90
Financial Highlights (Continued)
PowerShares Dynamic Small Cap Growth Portfolio
Year Ended April 30, | For the Period March 3, 2005* Through | ||||||||||||||||||
2008 | 2007 | 2006 | April 30, 2005 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||||||
Net asset value at beginning of period | $ | 18.59 | $ | 18.51 | $ | 13.90 | $ | 15.11 | |||||||||||
Net investment income (loss)** | (0.05 | ) | (0.05 | ) | 0.11 | (0.01 | ) | ||||||||||||
Net realized and unrealized gain (loss) on investments | (2.83 | ) | 0.13 | 4.50 | (1.20 | ) | |||||||||||||
Total from operations | (2.88 | ) | 0.08 | 4.61 | (1.21 | ) | |||||||||||||
Net asset value at end of period | $ | 15.71 | $ | 18.59 | $ | 18.51 | $ | 13.90 | |||||||||||
TOTAL RETURN*** | (15.49 | )% | 0.43 | % | 33.17 | % | (8.02 | )% | |||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||
Net assets at end of period (000's omitted) | $ | 51,846 | $ | 61,347 | $ | 118,465 | $ | 9,727 | |||||||||||
Ratio to average net assets of: | |||||||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.65 | % | 0.63 | %† | |||||||||||
Expenses, prior to Waivers and/or Recapture | 0.77 | % | 0.84 | % | 0.90 | % | 2.34 | %† | |||||||||||
Net investment income (loss), after Waivers and/or Recapture | (0.27 | )% | (0.32 | )% | 0.65 | % | (0.48 | )%† | |||||||||||
Portfolio turnover rate †† | 78 | % | 114 | % | 120 | % | 0 | % | |||||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | — | (a) | $ | (0.02 | ) | — | — |
PowerShares Dynamic Small Cap Portfolio
Year Ended April 30, 2008 | For the Period December 1, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 26.68 | $ | 25.17 | |||||||
Net investment income** | 0.06 | — | (a) | ||||||||
Net realized and unrealized gain (loss) on investments | (3.13 | ) | 1.51 | ||||||||
Total from operations | (3.07 | ) | 1.51 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.08 | ) | — | (a) | |||||||
Return of capital | (0.22 | ) | — | ||||||||
Total distribution | (0.30 | ) | — | ||||||||
Net asset value at end of period | $ | 23.31 | $ | 26.68 | |||||||
TOTAL RETURN*** | (11.61 | )% | 6.01 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 16,314 | $ | 8,005 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.79 | % | 0.74 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.96 | % | 1.55 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.26 | % | 0.04 | %† | |||||||
Portfolio turnover rate †† | 103 | % | 52 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.05 | $ | — | (a) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
91
Financial Highlights (Continued)
PowerShares Dynamic Small Cap Value Portfolio
Year Ended April 30, | For the Period March 3, 2005* Through | ||||||||||||||||||
2008 | 2007 | 2006 | April 30, 2005 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||||||
Net asset value at beginning of period | $ | 18.68 | $ | 17.01 | $ | 13.79 | $ | 15.06 | |||||||||||
Net investment income** | 0.16 | 0.13 | 0.11 | 0.01 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (2.47 | ) | 1.67 | 3.22 | (1.28 | ) | |||||||||||||
Total from operations | (2.31 | ) | 1.80 | 3.33 | (1.27 | ) | |||||||||||||
Distributions to shareholders from: | |||||||||||||||||||
Net investment income | (0.16 | ) | (0.13 | ) | (0.11 | ) | — | ||||||||||||
Return of capital | (0.41 | ) | — | — | — | ||||||||||||||
Total distribution | (0.57 | ) | (0.13 | ) | (0.11 | ) | — | ||||||||||||
Net asset value at end of period | $ | 15.80 | $ | 18.68 | $ | 17.01 | $ | 13.79 | |||||||||||
TOTAL RETURN*** | (12.51 | )% | 10.64 | % | 24.20 | % | (8.46 | )% | |||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||
Net assets at end of period (000's omitted) | $ | 91,667 | $ | 117,680 | $ | 66,339 | $ | 9,651 | |||||||||||
Ratio to average net assets of: | |||||||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.66 | % | 0.63 | %† | |||||||||||
Expenses, prior to Waivers and/or Recapture | 0.67 | % | 0.80 | % | 1.06 | % | 2.36 | %† | |||||||||||
Net investment income, after Waivers and/or Recapture | 0.91 | % | 0.73 | % | 0.73 | % | 0.45 | %† | |||||||||||
Portfolio turnover rate †† | 86 | % | 76 | % | 118 | % | 0 | % | |||||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.03 | ) | $ | 0.01 | — | — |
PowerShares FTSE NASDAQ Small Cap Portfolio
For the Period April 1, 2008* Through April 30, 2008 | |||||||
PER SHARE OPERATING PERFORMANCE: | |||||||
Net asset value at beginning of period | $ | 25.73 | |||||
Net investment income** | — | (a) | |||||
Net realized and unrealized loss on investments | (0.10 | ) | |||||
Total from operations | (0.10 | ) | |||||
Net asset value at end of period | $ | 25.63 | |||||
TOTAL RETURN*** | (0.39 | )%(b) | |||||
RATIOS/SUPPLEMENTAL DATA: | |||||||
Net assets at end of period (000's omitted) | $ | 2,563 | |||||
Ratio to average net assets of: | |||||||
Expenses | 0.70 | %† | |||||
Net investment loss | (0.09 | )%† | |||||
Portfolio turnover rate †† | 0 | % | |||||
Undistributed net investment income included in price of units issued and redeemed**# | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
(b) The total return from Fund Inception (first day of trading on the Exchange) to April 30, 2008 was (0.50)%.
See Notes to Financial Statements.
92
Financial Highlights (Continued)
PowerShares Zacks Micro Cap Portfolio
Year Ended April 30, | For the Period August 18, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 18.32 | $ | 17.47 | $ | 14.79 | |||||||||
Net investment income** | 0.16 | 0.06 | — | (a) | |||||||||||
Net realized and unrealized gain (loss) on investments | (4.73 | ) | 0.81 | 2.69 | |||||||||||
Total from operations | (4.57 | ) | 0.87 | 2.69 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.12 | ) | (0.02 | ) | (0.01 | ) | |||||||||
Return of capital | — | — | — | (a) | |||||||||||
Total distributions | (0.12 | ) | (0.02 | ) | (0.01 | ) | |||||||||
Net asset value at end of period | $ | 13.63 | $ | 18.32 | $ | 17.47 | |||||||||
TOTAL RETURN*** | (25.07 | )% | 4.99 | % | 18.20 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 94,068 | $ | 192,310 | $ | 158,976 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.70 | % | 0.71 | % | 0.72 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.71 | % | 0.78 | % | 0.82 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 0.99 | % | 0.36 | % | 0.01 | %† | |||||||||
Portfolio turnover rate †† | 54 | % | 72 | % | 78 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.03 | ) | $ | 0.01 | — |
PowerShares Zacks Small Cap Portfolio
Year Ended April 30, | For the Period February 16, 2006* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 27.51 | $ | 26.76 | $ | 25.41 | |||||||||
Net investment income** | 0.22 | ††† | 0.05 | 0.02 | |||||||||||
Net realized and unrealized gain (loss) on investments | (4.23 | ) | 0.76 | 1.33 | |||||||||||
Total from operations | (4.01 | ) | 0.81 | 1.35 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.19 | ) | (0.06 | ) | — | ||||||||||
Return of capital | — | — | (a) | — | |||||||||||
Total distributions | (0.19 | ) | (0.06 | ) | — | ||||||||||
Net asset value at end of period | $ | 23.31 | $ | 27.51 | $ | 26.76 | |||||||||
TOTAL RETURN*** | (14.66 | )% | 3.03 | % | 5.31 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 39,630 | $ | 71,530 | $ | 58,866 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.70 | % | 0.71 | % | 0.75 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.83 | % | 0.89 | % | 1.17 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 0.81 | %††† | 0.19 | % | 0.30 | %† | |||||||||
Portfolio turnover rate †† | 58 | % | 87 | % | 1 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.05 | ) | $ | — | (a) | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
††† Net investment income per share and the ratio of net investment income to average net assets include a special cash dividend received of $3.00 per share owned of Books-A-Million, Inc. on July 5, 2007. Net investment income per share and the ratio of net investment income to average net assets excluding the special dividend are $0.19 and 0.72%, respectively.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
93
Notes to Financial Statements
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the "Trust") was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company, registered under the Investment Company Act of 1940, as amended (the "1940 Act"). As of period end, the Trust offers seventy-three portfolios. This report includes the following portfolios:
PowerShares Dynamic Aggressive Growth Portfolio | "Dynamic Aggressive Growth Portfolio" | ||||||
PowerShares Dynamic Deep Value Portfolio | "Dynamic Deep Value Portfolio" | ||||||
PowerShares Dynamic Large Cap Growth Portfolio | "Dynamic Large Cap Growth Portfolio" | ||||||
PowerShares Dynamic Large Cap Portfolio | "Dynamic Large Cap Portfolio" | ||||||
PowerShares Dynamic Large Cap Value Portfolio | "Dynamic Large Cap Value Portfolio" | ||||||
PowerShares Dynamic Mid Cap Growth Portfolio | "Dynamic Mid Cap Growth Portfolio" | ||||||
PowerShares Dynamic Mid Cap Portfolio | "Dynamic Mid Cap Portfolio" | ||||||
PowerShares Dynamic Mid Cap Value Portfolio | "Dynamic Mid Cap Value Portfolio" | ||||||
PowerShares Dynamic Small Cap Growth Portfolio | "Dynamic Small Cap Growth Portfolio" | ||||||
PowerShares Dynamic Small Cap Portfolio | "Dynamic Small Cap Portfolio" | ||||||
PowerShares Dynamic Small Cap Value Portfolio | "Dynamic Small Cap Value Portfolio" | ||||||
PowerShares FTSE NASDAQ Small Cap Portfolio | "FTSE NASDAQ Small Cap Portfolio" | ||||||
PowerShares Zacks Micro Cap Portfolio | "Zacks Micro Cap Portfolio" | ||||||
PowerShares Zacks Small Cap Portfolio | "Zacks Small Cap Portfolio" | ||||||
Each portfolio (the "Fund" or collectively the "Funds") represents a separate series of the Trust. The shares of the Funds are referred to herein as "Shares" or "Fund Shares." Each Fund's shares are listed and traded on the American Stock Exchange except for shares of the FTSE NASDAQ Small Cap Portfolio. The shares of FTSE NASDAQ Small Cap Portfolio are listed and traded on NASDAQ.
The Funds' market prices may differ to some degree from the net asset value of the shares of each Fund. Unlike conventional mutual funds, each Fund issues and redeems shares on a continuous basis, at net asset value, only in a large specified number of shares, each called a "Creation Unit." Creation Units are issued and redeemed generally in-kind for securities included in the relevant index. Except when aggregated in Creation Units, shares are not individually redeemable securities of the Funds. The investment objective of each Fund is to seek investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of the following equity indices:
Fund | Index | ||||||
Dynamic Aggressive Growth Portfolio | Dynamic Aggressive Growth IntellidexSM Index | ||||||
Dynamic Deep Value Portfolio | Dynamic Deep Value IntellidexSM Index | ||||||
Dynamic Large Cap Growth Portfolio | Dynamic Large Cap Growth IntellidexSM Index | ||||||
Dynamic Large Cap Portfolio | Dynamic Large Cap IntellidexSM Index | ||||||
Dynamic Large Cap Value Portfolio | Dynamic Large Cap Value IntellidexSM Index | ||||||
Dynamic Mid Cap Growth Portfolio | Dynamic Mid Cap Growth IntellidexSM Index | ||||||
Dynamic Mid Cap Portfolio | Dynamic Mid Cap IntellidexSM Index | ||||||
Dynamic Mid Cap Value Portfolio | Dynamic Mid Cap Value IntellidexSM Index | ||||||
Dynamic Small Cap Growth Portfolio | Dynamic Small Cap Growth IntellidexSM Index | ||||||
Dynamic Small Cap Portfolio | Dynamic Small Cap IntellidexSM Index | ||||||
94
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Fund | Index | ||||||
Dynamic Small Cap Value Portfolio | Dynamic Small Cap Value IntellidexSM Index | ||||||
FTSE NASDAQ Small Cap Portfolio | FTSE NASDAQ Small Cap Index | ||||||
Zacks Micro Cap Portfolio | Zacks Micro Cap Index | ||||||
Zacks Small Cap Portfolio | Zacks Small Cap Index | ||||||
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates.
A. Security Valuation
Securities, including restricted securities, are valued according to the following policy.
A security listed or traded on an exchange (except convertible bonds) 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. Listed options if no closing price is available are valued at the mean between the last bid and the ask 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 ask prices.
Investments in open-end registered investment companies are valued at the end of day net asset value per share.
Debt obligations (including convertible bonds) 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, yield, quality, type of issue, coupon rate, maturity, individual trading characteristics and other market data. Short-term obligations, including commercial paper, having 60 days or less to maturity are recorded at amortized cost which approximates value. Debt securities are subject to interest rate and credit risks. In addition, all debt securities involve some risk of default with respect to interest and/or principal payments.
Foreign securities (including foreign exchange contracts) are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. 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 are significant and may 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
95
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
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 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, ADRs 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 stric t 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.
Securities for which market quotations are not readily available or are 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/ask 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.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer's assets, general economic conditions, interest rates, investor perceptions and market liquidity.
B. Other Risk
The Funds may concentrate investments in a comparatively narrow segment of the economy. Consequently, such Fund may tend to be more volatile than other funds, and the value of investments may tend to rise and fall more rapidly.
When investing in securities of a limited number of companies, each investment has a greater effect on the Fund's overall performance, and any change in the value of those securities could significantly affect the value of your investment in the Fund.
C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and will distribute substantially all of the Fund's taxable earnings to its shareholders. As such, the Funds will not be subject to Federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for Federal income taxes is included.
Income and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from accounting principles generally accepted in the United States. These differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and Passive Foreign Investment Company adjustments, if any.
The Funds file tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
96
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
D. Investment Income and Investment Transactions
Dividend income is recorded on the ex-dividend date net of foreign taxes withheld, if any. Interest income is recorded on the accrual basis. Investment transactions are recorded on the trade date. Realized gains and losses from the sale or disposition of securities are calculated on the specific identified cost basis. Dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
E. Expenses
Expenses of the Trust, which are directly identifiable to a specific Fund, are applied to that Fund. Expenses which are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund (except for FTSE NASDAQ Small Cap Portfolio) is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, any distribution fees or expenses and extraordinary expenses.
The FTSE NASDAQ Small Cap Portfolio has agreed to pay an annual unitary management fee to the Invesco PowerShares Capital Management LLC ("the Adviser") (formerly PowerShares Capital Management LLC). Whereby, the Adviser has agreed to pay substantially all expenses of the FTSE NASDAQ Small Cap Portfolio, including the cost of transfer agency, custody, fund administration, legal, audit and other services, except for distribution fees, brokerage expenses, taxes, interest and other extraordinary expenses.
F. Dividends and Distributions to Shareholders
Each Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and distributes net realized taxable capital gains, if any, annually in cash. Such distributions on a tax basis are determined in conformity with income tax regulations which may differ from accounting principles generally accepted in the United States of America. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund's financial statements as a tax return of capital at fiscal year end.
G. Equalization
All Funds use the accounting practice of equalization. This accounting method is used to keep the continuing shareholder's per share equity in undistributed net investment income from being affected by the continuous sales and redemptions of capital shares. Equalization is calculated on a per share basis whereby a portion of the proceeds from the sales and cost of repurchases of capital shares is applied to undistributed net investment income. The amount of equalization is disclosed in the Statements of Changes in Net Assets as undistributed net investment income included in the price of capital shares issued or redeemed. The distributions to shareholders of amounts so applied may be deemed to be a return of capital for tax purposes to the extent that such distributions exceed taxable income.
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with the Adviser such that the Adviser has overall responsibility as the Funds' investment adviser for the selection and ongoing monitoring of the
97
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Funds' investments, managing the Funds' business affairs and providing certain clerical, bookkeeping and other administrative services. Each Fund (other than the for FTSE NASDAQ Small Cap Portfolio) has agreed to pay an annual fee of 0.50% of each Fund's average daily net assets. The FTSE NASDAQ Small Cap Portfolio has agreed to pay an annual unitary management fee of 0.70% of its average daily net assets and the Adviser has agreed to pay substantially all expenses of the FTSE NASDAQ Small Cap Portfolio, including the cost of transfer agency, custody, fund administration, legal, audit and other services, except for the management fee, distribution fees, brokerage expenses, taxes, interest and other extraordinary expenses, if any.
The Adviser has entered into an Amended and Restated Excess Expense Agreement ("Excess Expense Agreement,") with the Trust, under which the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses of the Funds (excluding interest expense, brokerage commissions and other trading expenses, sub-licensing fees, offering costs, taxes and extraordinary expenses) from exceeding 0.60% of average daily net assets per year (the "Expense Cap"), at least until August 30, 2009. Offering costs excluded from the Expense Cap are: (a) legal fees pertaining to the Funds' shares offered for sale; (b) Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange.
The Excess Expense Agreement provides that the expenses borne by the Adviser are subject to recapture by the Adviser for up to three years from the date the fee or expense was borne by the Adviser, but no recapture payment will be made by a Fund if it would result in the Fund exceeding its Expense Cap as specified above. The Excess Expense Agreement does not apply to the FTSE NASDAQ Small Cap Portfolio.
The net amount of fees waived and other expenses assumed by the Adviser and the amount of recapture paid to the Adviser pursuant to the Excess Expense Agreement are collectively referred to as 'Waivers and/or Recapture'.
During the year ended April 30, 2008, the amount of 'Waivers and/or Recapture' was as follows:
(Waivers) and/or Recapture | |||||||
Dynamic Aggressive Growth Portfolio | $ | (109,011 | ) | ||||
Dynamic Deep Value Portfolio | (106,397 | ) | |||||
Dynamic Large Cap Growth Portfolio | 177,056 | ||||||
Dynamic Large Cap Portfolio | (103,842 | ) | |||||
Dynamic Large Cap Value Portfolio | 95,715 | ||||||
Dynamic Mid Cap Growth Portfolio | 80,131 | ||||||
Dynamic Mid Cap Portfolio | (102,985 | ) | |||||
Dynamic Mid Cap Value Portfolio | (47,297 | ) | |||||
Dynamic Small Cap Growth Portfolio | (82,728 | ) | |||||
Dynamic Small Cap Portfolio | (110,293 | ) | |||||
Dynamic Small Cap Value Portfolio | (43,517 | ) | |||||
Zacks Micro Cap Portfolio | (20,797 | ) | |||||
Zacks Small Cap Portfolio | (73,796 | ) |
The net amounts of Waivers and/or Recapture are also shown on the Statements of Operations.
98
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
The amounts available for potential future recapture by the Adviser under the Excess Expense Agreement and the expiration schedule at April 30, 2008 are as follows:
Total Potential Recapture | Potential Recapture Amounts Expiring | ||||||||||||||||||
Amount | 04/30/09 | 04/30/10 | 04/30/11 | ||||||||||||||||
Dynamic Aggressive Growth Portfolio | $ | 154,182 | $ | — | $ | 33,491 | $ | 120,691 | |||||||||||
Dynamic Deep Value Portfolio | 150,869 | — | 38,565 | 112,304 | |||||||||||||||
Dynamic Large Cap Growth Portfolio | 46,729 | — | 7,424 | 39,305 | |||||||||||||||
Dynamic Large Cap Portfolio | 147,948 | — | 38,552 | 109,396 | |||||||||||||||
Dynamic Large Cap Value Portfolio | 143,285 | — | 141,671 | 1,614 | |||||||||||||||
Dynamic Mid Cap Growth Portfolio | 174,604 | 28,694 | 119,729 | 26,181 | |||||||||||||||
Dynamic Mid Cap Portfolio | 147,575 | — | 39,219 | 108,356 | |||||||||||||||
Dynamic Mid Cap Value Portfolio | 305,730 | 122,082 | 132,535 | 51,113 | |||||||||||||||
Dynamic Small Cap Growth Portfolio | 341,697 | 115,109 | 142,404 | 84,184 | |||||||||||||||
Dynamic Small Cap Portfolio | 156,848 | — | 40,892 | 115,956 | |||||||||||||||
Dynamic Small Cap Value Portfolio | 305,019 | 124,935 | 134,255 | 45,829 | |||||||||||||||
Dynamic Zacks Micro Cap Portfolio | 219,604 | 65,312 | 120,775 | 33,517 | |||||||||||||||
Dynamic Zacks Small Cap Portfolio | 222,089 | 20,987 | 114,734 | 86,368 |
Distribution Agreement
The Trust has entered into a Distribution Agreement with Invesco Aim Distributors, Inc. (formerly A I M Distributors, Inc.) (the "Distributor") which serves as the Distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in Shares.
Licensing Fee Agreements
The Adviser has entered into licensing agreements for each Fund with the following Licensors:
Fund | Licensor | ||||||
Dynamic Aggressive Growth Portfolio | American Stock Exchange | ||||||
Dynamic Deep Value Portfolio | American Stock Exchange | ||||||
Dynamic Large Cap Growth Portfolio | American Stock Exchange | ||||||
Dynamic Large Cap Portfolio | American Stock Exchange | ||||||
Dynamic Large Cap Value Portfolio | American Stock Exchange | ||||||
Dynamic Mid Cap Growth Portfolio | American Stock Exchange | ||||||
Dynamic Mid Cap Portfolio | American Stock Exchange | ||||||
Dynamic Mid Cap Value Portfolio | American Stock Exchange | ||||||
Dynamic Small Cap Growth Portfolio | American Stock Exchange | ||||||
Dynamic Small Cap Portfolio | American Stock Exchange | ||||||
Dynamic Small Cap Value Portfolio | American Stock Exchange | ||||||
FTSE NASDAQ Small Cap Portfolio | FTSE International Limited | ||||||
Zacks Micro Cap Portfolio | Zacks Investment Research, Inc. | ||||||
Zacks Small Cap Portfolio | Zacks Investment Research, Inc. | ||||||
The above trademarks are owned by the respective Licensors. These trademarks have been licensed to the Adviser for use with the Funds. The Funds are not sponsored, endorsed, sold or promoted by the Licensors and the Licensors make no representation regarding the advisability of investing in any of these
99
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Funds. The Funds are required to pay the sub-licensing fees which are shown on the Statements of Operations.
The Bank of New York, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian and fund accounting and transfer agent for each Fund.
The custodian has agreed to provide overdraft protection to the Funds according to the terms of the service agreement.
Note 4. Federal Income Tax
At April 30, 2008, costs of investments on a tax basis including the adjustments for financial reporting purposes as of the most recently completed Federal income tax reporting period were as follows:
Dynamic Aggressive Growth Portfolio | $ | 12,337,915 | |||||
Dynamic Deep Value Portfolio | 7,373,620 | ||||||
Dynamic Large Cap Growth Portfolio | 673,011,178 | ||||||
Dynamic Large Cap Portfolio | 26,290,842 | ||||||
Dynamic Large Cap Value Portfolio | 260,705,146 | ||||||
Dynamic Mid Cap Growth Portfolio | 383,510,285 | ||||||
Dynamic Mid Cap Portfolio | 25,331,241 | ||||||
Dynamic Mid Cap Value Portfolio | 84,848,477 | ||||||
Dynamic Small Cap Growth Portfolio | 51,123,643 | ||||||
Dynamic Small Cap Portfolio | 16,105,297 | ||||||
Dynamic Small Cap Value Portfolio | 91,147,196 | ||||||
FTSE NASDAQ Small Cap Portfolio | 2,563,600 | ||||||
Zacks Micro Cap Portfolio | 101,968,194 | ||||||
Zacks Small Cap Portfolio | 45,369,982 |
At April 30, 2008, the components of accumulated earnings/loss on a tax-basis were as follows:
Accumulated Earnings | Net Accumulated Capital and other Gains/Losses | Unrealized Appreciation/ Depreciation | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Total Accumulated Earnings/Loss | ||||||||||||||||||||||
Dynamic Aggressive Growth Portfolio | $ | — | $ | (497,988 | ) | $ | 495,759 | $ | 1,158,303 | $ | (662,544 | ) | $ | (2,229 | ) | ||||||||||||
Dynamic Deep Value Portfolio | 16,611 | (1,131,687 | ) | (108,093 | ) | 377,212 | (485,305 | ) | (1,223,169 | ) | |||||||||||||||||
Dynamic Large Cap Growth Portfolio | 568,098 | (25,132,385 | ) | (7,416,771 | ) | 30,806,253 | (38,223,024 | ) | (31,981,058 | ) | |||||||||||||||||
Dynamic Large Cap Portfolio | 66,667 | (87,112 | ) | (259,256 | ) | 1,036,108 | (1,295,364 | ) | (279,701 | ) | |||||||||||||||||
Dynamic Large Cap Value Portfolio | 479,661 | (4,233,318 | ) | (8,379,731 | ) | 12,968,239 | (21,347,970 | ) | (12,133,388 | ) | |||||||||||||||||
Dynamic Mid Cap Growth Portfolio | — | (13,590,656 | ) | 6,371,552 | 21,816,008 | (15,444,456 | ) | (7,219,104 | ) | ||||||||||||||||||
Dynamic Mid Cap Portfolio | 17,028 | (628,828 | ) | 239,359 | 1,291,837 | (1,052,478 | ) | (372,441 | ) | ||||||||||||||||||
Dynamic Mid Cap Value Portfolio | 82,617 | (7,969,826 | ) | (5,270,060 | ) | 2,987,506 | (8,257,566 | ) | (13,157,269 | ) | |||||||||||||||||
Dynamic Small Cap Growth Portfolio | — | (20,584,379 | ) | 737,753 | 3,695,996 | (2,958,243 | ) | (19,846,626 | ) |
100
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Accumulated Earnings | Net Accumulated Capital and other Gains/Losses | Unrealized Appreciation/ Depreciation | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Total Accumulated Earnings/Loss | ||||||||||||||||||||||
Dynamic Small Cap Portfolio | $ | — | $ | (1,028,299 | ) | $ | 258,189 | $ | 1,157,784 | $ | (899,595 | ) | $ | (770,110 | ) | ||||||||||||
Dynamic Small Cap Value Portfolio | — | (13,248,558 | ) | 429,356 | 6,970,897 | (6,541,541 | ) | (12,819,202 | ) | ||||||||||||||||||
FTSE NASDAQ Small Cap Portfolio | — | (90 | ) | (9,399 | ) | 128,064 | (137,463 | ) | (9,489 | ) | |||||||||||||||||
Zacks Micro Cap Portfolio | 571,023 | (31,452,116 | ) | (7,558,132 | ) | 5,272,419 | (12,830,551 | ) | (38,439,225 | ) | |||||||||||||||||
Zacks Small Cap Portfolio | 60,388 | (10,640,009 | ) | (5,590,340 | ) | 2,432,379 | (8,022,719 | ) | (16,169,961 | ) |
Distributions to Shareholders:
The tax character of distributions paid was as follows:
Year Ended April 30, 2008 | Period Ended April 30, 2007 | ||||||||||
Distributions paid from Ordinary Income | Distributions paid from Ordinary Income | ||||||||||
Dynamic Deep Value Portfolio | $ | 236,479 | $ | 43,560 | |||||||
Dynamic Large Cap Growth Portfolio | 1,364,504 | 240,165 | |||||||||
Dynamic Large Cap Portfolio | 115,860 | 45,948 | |||||||||
Dynamic Large Cap Value Portfolio | 6,461,590 | 3,984,387 | |||||||||
Dynamic Mid Cap Growth Portfolio | — | 711,633 | |||||||||
Dynamic Mid Cap Portfolio | 71,701 | 34,110 | |||||||||
Dynamic Mid Cap Value Portfolio | 1,388,612 | 891,950 | |||||||||
Dynamic Small Cap Portfolio | 24,996 | 1,164 | |||||||||
Dynamic Small Cap Value Portfolio | 1,007,247 | 591,897 | |||||||||
Zacks Micro Cap Portfolio | 1,084,217 | 206,496 | |||||||||
Zacks Small Cap Portfolio | 359,366 | 126,531 | |||||||||
Year Ended April 30, 2008 | Period Ended April 30, 2007 | ||||||||||
Distributions paid from Return of Capital | Distributions paid from Return of Capital | ||||||||||
Dynamic Large Cap Growth Portfolio | — | $ | 3,527 | ||||||||
Dynamic Mid Cap Growth Portfolio | $ | 35,820 | 9,929 | ||||||||
Dynamic Small Cap Portfolio | 66,108 | — | |||||||||
Dynamic Small Cap Value Portfolio | 2,478,948 | — | |||||||||
Zacks Small Cap Portfolio | — | 10,819 |
At April 30, 2008, for Federal income tax purposes, the Funds have capital loss carryforwards available as shown in the table below, to the extent provided by the regulations, to offset future capital gains through the years indicated. To the extent that these loss carryforwards are used to offset future capital gains, it is probable that the capital gains so offset will not be distributed to shareholders. The use of some portion of
101
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
the capital loss carryforward by any one fund may be limited by federal tax rules. These rules limit the use of the carryforward when there has been a greater than fifty percent change in ownership of a fund.
Year of Expiration | Total | ||||||||||||||||||
2014 | 2015 | 2016 | Amount | ||||||||||||||||
Dynamic Aggressive Growth Portfolio | $ | — | $ | — | $ | 497,988 | $ | 497,988 | |||||||||||
Dynamic Deep Value Portfolio | — | — | 1,131,687 | 1,131,687 | |||||||||||||||
Dynamic Large Cap Growth Portfolio | 191,864 | 10,916,066 | 14,024,455 | 25,132,385 | |||||||||||||||
Dynamic Large Cap Portfolio | — | — | 87,112 | 87,112 | |||||||||||||||
Dynamic Large Cap Value Portfolio | 70,814 | 1,378,743 | 2,783,761 | 4,233,318 | |||||||||||||||
Dynamic Mid Cap Growth Portfolio | 422,220 | 8,055,857 | 5,112,579 | 13,590,656 | |||||||||||||||
Dynamic Mid Cap Portfolio | — | — | 628,828 | 628,828 | |||||||||||||||
Dynamic Mid Cap Value Portfolio | 237,806 | 2,384,765 | 5,347,255 | 7,969,826 | |||||||||||||||
Dynamic Small Cap Growth Portfolio | 823,782 | 13,094,039 | 6,666,558 | 20,584,379 | |||||||||||||||
Dynamic Small Cap Portfolio | — | — | 1,028,299 | 1,028,299 | |||||||||||||||
Dynamic Small Cap Value Portfolio | 703,862 | 3,929,009 | 8,615,687 | 13,248,558 | |||||||||||||||
FTSE NASDAQ Small Cap Portfolio | — | — | 90 | 90 | |||||||||||||||
Zacks Micro Cap Portfolio | 1,951,245 | 15,172,527 | 14,328,344 | 31,452,116 | |||||||||||||||
Zacks Small Cap Portfolio | — | 3,417,527 | 7,222,482 | 10,640,009 |
During the period ended April 30, 2008, the Funds incurred and will elect to defer net capital losses as follows:
Post-October Losses | |||||||
Dynamic Aggressive Growth Portfolio | $ | 1,688,965 | |||||
Dynamic Deep Value Portfolio | 842,967 | ||||||
Dynamic Large Cap Growth Portfolio | 32,984,862 | ||||||
Dynamic Large Cap Portfolio | 858,749 | ||||||
Dynamic Large Cap Value Portfolio | 6,556,168 | ||||||
Dynamic Mid Cap Growth Portfolio | 37,708,602 | ||||||
Dynamic Mid Cap Portfolio | 1,952,729 | ||||||
Dynamic Mid Cap Value Portfolio | 7,047,269 | ||||||
Dynamic Small Cap Growth Portfolio | 6,425,679 | ||||||
Dynamic Small Cap Portfolio | 1,490,509 | ||||||
Dynamic Small Cap Value Portfolio | 11,075,002 | ||||||
Zacks Micro Cap Portfolio | 15,290,956 | ||||||
Zacks Small Cap Portfolio | 4,287,674 |
In order to present shares of beneficial interest and accumulated net realized gains or losses on the Statements of Assets and Liabilities that more closely represent their tax character, certain adjustments have been made to shares of beneficial interest, undistributed net investment income or loss and net
102
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
realized gains or losses on investments. These differences are primarily due to redemptions in-kind and the tax treatment of income earned from investments in partnerships, wash sales, book equalization, and net operating losses, if any. These adjustments have no effect on net assets. For the period ended April 30, 2008, the adjustments were as follows:
Undistributed Net Investment Income (Loss) | Undistributed Capital Gains/ (Accumulated Losses) | Shares of Beneficial Interest | |||||||||||||
Dynamic Aggressive Growth Portfolio | $ | 81,951 | $ | (2,079,383 | ) | $ | 1,997,432 | ||||||||
Dynamic Deep Value Portfolio | 10,801 | (1,095,614 | ) | 1,084,813 | |||||||||||
Dynamic Large Cap Growth Portfolio | (458,077 | ) | (40,929,676 | ) | 41,387,753 | ||||||||||
Dynamic Large Cap Portfolio | (36,730 | ) | (784,924 | ) | 821,654 | ||||||||||
Dynamic Large Cap Value Portfolio | 32,015 | (19,698,183 | ) | 19,666,168 | |||||||||||
Dynamic Mid Cap Growth Portfolio | 234,452 | (48,095,519 | ) | 47,861,067 | |||||||||||
Dynamic Mid Cap Portfolio | 4,238 | (1,594,088 | ) | 1,589,850 | |||||||||||
Dynamic Mid Cap Value Portfolio | (260 | ) | (7,295,286 | ) | 7,295,546 | ||||||||||
Dynamic Small Cap Growth Portfolio | 168,730 | (4,082,681 | ) | 3,913,951 | |||||||||||
Dynamic Small Cap Portfolio | 44,936 | (1,253,822 | ) | 1,208,886 | |||||||||||
Dynamic Small Cap Value Portfolio | 2,672,144 | (5,428,634 | ) | 2,756,490 | |||||||||||
FTSE NASDAQ Small Cap Portfolio | 174 | — | (174 | ) | |||||||||||
Zacks Micro Cap Portfolio | 163,039 | (2,750,196 | ) | 2,587,157 | |||||||||||
Zacks Small Cap Portfolio | 61,226 | (7,318,785 | ) | 7,257,559 |
Note 5. Investment Transactions
For the period ended April 30, 2008, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, money market funds and in-kind transactions, were as follows:
Purchases | Sales | ||||||||||
Dynamic Aggressive Growth Portfolio | $ | 9,757,547 | $ | 10,060,573 | |||||||
Dynamic Deep Value Portfolio | 12,766,233 | 12,983,687 | |||||||||
Dynamic Large Cap Growth Portfolio | 243,516,283 | 244,743,481 | |||||||||
Dynamic Large Cap Portfolio | 8,111,954 | 8,004,816 | |||||||||
Dynamic Large Cap Value Portfolio | 57,487,022 | 59,752,347 | |||||||||
Dynamic Mid Cap Growth Portfolio | 250,530,770 | 263,890,995 | |||||||||
Dynamic Mid Cap Portfolio | 17,293,965 | 17,361,186 | |||||||||
Dynamic Mid Cap Value Portfolio | 54,237,973 | 54,635,344 | |||||||||
Dynamic Small Cap Growth Portfolio | 46,648,521 | 49,426,552 | |||||||||
Dynamic Small Cap Portfolio | 10,391,126 | 9,996,848 | |||||||||
Dynamic Small Cap Value Portfolio | 92,530,884 | 92,805,801 | |||||||||
FTSE NASDAQ Small Cap Portfolio | — | 9,295 | |||||||||
Zacks Micro Cap Portfolio | 78,309,137 | 82,730,913 | |||||||||
Zacks Small Cap Portfolio | 32,465,346 | 33,001,622 |
103
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
For the period ended April 30, 2008, in-kind transactions were as follows:
Securities Received | Securities Delivered | ||||||||||
Dynamic Aggressive Growth Portfolio | $ | 20,546,000 | $ | 17,962,772 | |||||||
Dynamic Deep Value Portfolio | 11,561,266 | 18,629,586 | |||||||||
Dynamic Large Cap Growth Portfolio | 941,318,902 | 521,504,978 | |||||||||
Dynamic Large Cap Portfolio | 26,543,124 | 10,584,865 | |||||||||
Dynamic Large Cap Value Portfolio | 182,949,463 | 201,198,070 | |||||||||
Dynamic Mid Cap Growth Portfolio | 645,332,740 | 427,778,613 | |||||||||
Dynamic Mid Cap Portfolio | 31,971,730 | 16,231,574 | |||||||||
Dynamic Mid Cap Value Portfolio | 137,644,549 | 147,219,455 | |||||||||
Dynamic Small Cap Growth Portfolio | 128,446,149 | 124,835,755 | |||||||||
Dynamic Small Cap Portfolio | 17,794,015 | 8,970,271 | |||||||||
Dynamic Small Cap Value Portfolio | 157,999,020 | 165,017,760 | |||||||||
FTSE NASDAQ Small Cap Portfolio | 2,572,555 | — | |||||||||
Zacks Micro Cap Portfolio | 134,060,719 | 184,406,709 | |||||||||
Zacks Small Cap Portfolio | 67,939,454 | 90,150,802 |
Gains on in-kind transactions are not considered taxable gains for Federal income tax purposes.
Note 6. Trustees' Fees
The Funds (except for FTSE NASDAQ Small Cap Portfolio) compensate each Trustee on behalf of the Trust who is not an employee of the Trust or its affiliates. With respect to FTSE NASDAQ Small Cap Portfolio, the Adviser, as a result of the unitary management fee, compensates each Trustee on behalf of the Fund. Interested Trustees and Officers of the Trust do not receive any Trustees' fees.
The Trust (has adopted a deferred compensation plan (the "Plan"). Under the Plan, a trustee who is not an "interested person" (as defined in the 1940 Act) and has elected to participate in the Plan (a "participating trustee") may defer receipt of all or a portion of his compensation ("Deferral Fees"). Such Deferred Fees are deemed to be invested in selected PowerShares Funds. The Deferral Fees payable to the participating trustee is valued as of the first business dates of each calendar quarter such Fees would have been paid to the participating trustee. The value increases with contributions or with increases in the value of the shares selected, and the value decreases with withdrawals or with declines in the value of the shares selected.
Note 7. Capital
Shares are created and redeemed by the Trust only in Creation Unit size aggregations of 100,000. Only authorized participants are permitted to create or redeem from the Funds. Such transactions are generally permitted on an in-kind basis, with a balancing cash component to equate the transaction to the net asset value per unit of each Fund of the Trust on the transaction date. Cash may be substituted equivalent to the value of certain securities generally when they are not available in sufficient quantity for delivery, not be eligible for trading by the Authorized Participant or as a result of other market circumstances.
104
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 8. Indemnifications
Under the Trust's organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust's maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
Note 9. New Accounting Pronouncement
On September 20, 2006, the FASB released Statement of Financial Accounting Standards No. 157 "Fair Value Measurement" ("FAS 157"). FAS 157 establishes an authoritative definition of fair value, sets out a framework for measuring fair value, and requires additional disclosures about fair-value measurement. The application of FAS 157 is required for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. Management has assessed the application of FAS 157 to the Funds and has determined that the adoption of FAS 157 is not expected to have a material impact on the Funds. Management intends for the Funds to adopt FAS 157 provisions during the fiscal year ending April 30, 2009.
105
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of each of the portfolios indicated in Note 1 of the financial statements (each a portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the "Trust") at April 30, 2008, and the results of each of their operations, the changes in each of their net assets, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Trust's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2008 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
New York, New York
June 30, 2008
106
Supplemental Information
Federal Income Tax Information
The percentages of investment income (dividend income plus short-term gains, if any) qualify as follows:
Qualified dividend income | Dividends-received deduction | ||||||||||
Dynamic Aggressive Growth Portfolio | 0 | % | 0 | % | |||||||
Dynamic Deep Value Portfolio | 100 | % | 100 | % | |||||||
Dynamic Large Cap Growth Portfolio | 100 | % | 100 | % | |||||||
Dynamic Large Cap Portfolio | 100 | % | 100 | % | |||||||
Dynamic Large Cap Value Portfolio | 100 | % | 100 | % | |||||||
Dynamic Mid Cap Growth Portfolio | 100 | % | 100 | % | |||||||
Dynamic Mid Cap Portfolio | 100 | % | 100 | % | |||||||
Dynamic Mid Cap Value Portfolio | 100 | % | 100 | % | |||||||
Dynamic Small Cap Growth Portfolio | 0 | % | 0 | % | |||||||
Dynamic Small Cap Portfolio | 100 | % | 100 | % | |||||||
Dynamic Small Cap Value Portfolio | 100 | % | 100 | % | |||||||
FTSE NASDAQ Small Cap | 0 | % | 0 | % | |||||||
Zacks Micro Cap Portfolio | 100 | % | 100 | % | |||||||
Zacks Small Cap Portfolio | 100 | % | 100 | % |
107
Supplemental Information (Continued)
Trustees and Officers
The Trustees who are not affiliated with the Adviser or affiliates of the Adviser ("Independent Trustees") and the Trustee who is affiliated with the Adviser ("Management Trustee") and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by the Trustee, are shown below.
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Ronn R. Bagge (b. 1958) YQA Capital Management, LLC 1755 S. Naperville Rd., Suite 100 Wheaton, IL 60187 | Trustee | Since 2003 | YQA Capital Management LLC (July 1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider) | 104 | None | ||||||||||||||||||
Marc M. Kole (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | Assistant Vice President and Controller, Priority Health (September 2005-April 2008); formerly, Interim CFO, Priority Health (July 2006-April 2007); formerly Senior Vice President of Finance, United Healthcare (health insurance) (July 2004-July 2005); formerly Senior Vice President of Finance, Oxford Health Plans (June 2000-July 2004) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
108
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
D. Mark McMillan (b. 1963) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Partner, Bell, Boyd & Lloyd LLP (1989-Present) | 104 | None | ||||||||||||||||||
Philip M. Nussbaum (b. 1961) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (formerly Betzold, Berg, Nussbaum & Heitman, Inc.) (November 2004-Present); formerly Managing Director, Communication Institute (May 2002-August 2003); formerly Executive Vice President of Finance, Betzold, Berg, Nussbaum & Heitman, Inc. (March 1994-1999) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
109
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Donald H. Wilson (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | President, Chief Operating Officer and Chief Financial Officer, AMCORE Financial, Inc. (bank holding company) (August 2007-Present); formerly Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (February 2006-August 2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (May 1995- February 2006) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
110
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Management Trustee | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex*** Overseen by Trustee | Other Directorships Held by Trustee | ||||||||||||||||||
H. Bruce Bond (b. 1963)** Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chairman of the Board, Trustee and Chief Executive Officer | Since 2003 | Managing Director, Invesco PowerShares Capital Management LLC (August 2002-Present); formerly Manager, Nuveen Investments (April 1998-August 2002) | 104 | None | ||||||||||||||||||
Availability of Additional Information About Funds' Trustees
The Statement of Additional Information includes additional information about the Funds' Trustees and is available, without charge, upon request at 800.337.4246.
* This is the date the Management Trustee began serving the Trust.
** Interested person as defined in Section 2(a)(19) of the 1940 Act.
*** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
111
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Officers | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | ||||||||||||
Bruce T. Duncan (b. 1954) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Financial Officer, Treasurer and Secretary | Chief Financial Officer and Treasurer Since 2006 Secretary Since 2008 | Senior Vice President of Finance, Invesco PowerShares Capital Management LLC (September 2005-Present); Private Practice Attorney (2000-2005); Vice President of Investor Relations, The ServiceMaster Company (1994-2000); Vice President of Taxes, The ServiceMaster Company (1990-2000) | ||||||||||||
Kevin R. Gustafson (b. 1965) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Compliance Officer | Since 2004 | General Counsel, Invesco PowerShares Capital Management LLC (September 2004-Present); Chief Compliance Officer, Invesco PowerShares Capital Management LLC (September 2004-April 2008); Attorney, Nyberg & Gustafson (2001-2004); Attorney, Burke, Warren, McKay & Serritella, P.C. (1997-2000) | ||||||||||||
* This is the period for which the Officers began serving the Trust. Each Officer serves a one year term, until his successor is elected.
112
Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 18, 2008, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the "Trust"), including the Independent Trustees, unanimously approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the "Adviser") and the Trust for the following 70 series (the "Funds"):
PowerShares Dynamic Market Portfolio
PowerShares Dynamic OTC Portfolio
PowerShares Golden Dragon Halter USX China Portfolio
PowerShares High Yield Equity Dividend AchieversTM Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Mid Cap Growth Portfolio
PowerShares Dynamic Mid Cap Value Portfolio
PowerShares Dynamic Small Cap Growth Portfolio
PowerShares Dynamic Small Cap Value Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Zacks Micro Cap Portfolio
PowerShares Aerospace & Defense Portfolio
PowerShares Dynamic Hardware & Consumer Electronics Portfolio
PowerShares Dynamic Telecommunications & Wireless Portfolio
PowerShares Value Line Timeliness Select Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares High Growth Rate Dividend AchieversTM Portfolio
PowerShares Zacks Small Cap Portfolio
PowerShares Dynamic Building and Construction Portfolio
PowerShares Dynamic Energy Exploration and Production Portfolio
PowerShares Dynamic Insurance Portfolio
PowerShares Dynamic Oil and Gas Services Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Utilities Portfolio
PowerShares Lux Nanotech Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares Water Resources Portfolio
PowerShares Dynamic Energy Sector Portfolio
PowerShares Dynamic Financial Sector Portfolio
PowerShares Dynamic Healthcare Sector Portfolio
PowerShares Dynamic Industrials Sector Portfolio
PowerShares Dynamic Large Cap Portfolio
PowerShares Dynamic MagniQuant Portfolio
PowerShares Dynamic Mid Cap Portfolio
PowerShares Dynamic Small Cap Portfolio
PowerShares Dynamic Technology Sector Portfolio
PowerShares Buyback AchieversTM Portfolio
PowerShares FTSE RAFI Basic Materials Sector Portfolio
PowerShares FTSE RAFI Consumer Goods Sector Portfolio
PowerShares FTSE RAFI Consumer Services Sector Portfolio
PowerShares FTSE RAFI Energy Sector Portfolio
PowerShares FTSE RAFI Financials Sector Portfolio
PowerShares FTSE RAFI Health Care Sector Portfolio
PowerShares FTSE RAFI Industrials Sector Portfolio
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares FTSE RAFI Utilities Sector Portfolio
PowerShares Cleantech Portfolio
PowerShares Dynamic Aggressive Growth Portfolio
PowerShares Dynamic Banking Portfolio
113
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
PowerShares Dynamic Basic Materials Sector Portfolio
PowerShares Dynamic Consumer Discretionary Sector Portfolio
PowerShares Dynamic Consumer Staples Sector Portfolio
PowerShares Dynamic Healthcare Services Portfolio
PowerShares Dynamic Deep Value Portfolio
PowerShares Financial Preferred Portfolio
PowerShares Listed Private Equity Portfolio
PowerShares DWA Technical Leaders Portfolio
PowerShares Value Line Industry Rotation Portfolio
PowerShares WilderHill Progressive Energy Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as the Funds grow, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered and amounts paid to other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser's services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser's current organization, including operations assistance provided by the Adviser's parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser's portfolio transaction policies and procedures. The Trustees reviewed information on the performance of the Funds and the performance of their benchmark indices. The Trustees also reviewed reports on the correlation and tracking error between the underlying index and each Fund's performance and reviewed a report of Ibbotson Associates, a c onsultant to the Independent Trustees, that analyzed the reasons for any tracking error for certain of the Funds, which the Adviser then applied to its analysis of the tracking error between the underlying index and the performance of each Fund. The Trustees noted that, in each case, the correlation and tracking error was within the range set forth in the registration statement. The Trustees also concluded that each of the Funds is correlated to its underlying index and that the tracking error for each Fund was within a reasonable range in that Fund's particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds' administrator, custodian and transfer agent. They noted the significant amount of time and effort that had been devoted to this oversight function.
Based on their review, the Trustees found that the nature and extent of services provided to the Funds under the Investment Advisory Agreement are appropriate and that the quality is good.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund's expense ratio and the advisory fee, as compared to three categories of comparable funds selected by Lipper Inc., an independent source: exchange-traded index funds ("ETFs"), open-end (non-ETF) index funds and open-end actively-managed funds. The Adviser supplemented the information prepared by Lipper Inc. with data it compiled on expense ratios and advisory fees of newer ETFs that recently commenced operations. The Trustees noted that the annual advisory fee charged to the Funds was
114
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
identical (0.50% of average net assets), except for the advisory fee for the PowerShares High Yield Equity Dividend Achievers(TM) Portfolio, the PowerShares Dividend Achievers(TM) Portfolio, the PowerShares High Growth Rate Dividend Achievers(TM) Portfolio and the PowerShares International Dividend Achievers(TM) Portfolio (for each of which the annual advisory fee was 0.40% of average net assets), and that the Adviser had agreed to waive the fee and/or pay expenses to the extent necessary to prevent the annual operating expenses of each Fund (excluding interest expenses, licensing fees and offering costs (for all Funds other than the initial two Funds, the PowerShares Dynamic OTC Portfolio and the PowerShares Dynamic Market Portfolio), brokerage commissions and other trading expenses, taxes and extraordinary expenses) from exceeding 0.60% of average net assets (0.50% of average net assets for the PowerShares High Yield Equity Di vidend Achievers(TM) Portfolio, the PowerShares Dividend Achievers(TM) Portfolio, the PowerShares High Growth Rate Dividend Achievers(TM) Portfolio and the PowerShares International Dividend Achievers(TM) Portfolio) at least until April 30, 2009. The Trustees noted that the Adviser represented that it does not provide investment management services to clients other than the Trust and other exchange-traded funds overseen by the Board. The Trustees noted that the advisory fees were at the higher end of the ETF peer funds, but were lower than the median of the open-end actively-managed peer funds. The Trustees determined that the advisory fees were reasonable because of the complexity of the indices, which generally require more frequent rebalancing of the portfolios, the distinguishing factors of the Funds, and the higher administrative, operational and management oversight costs for the Adviser. With respect to the Funds' expense ratios, the Trustees noted that the net expense ratios were at the higher end of the ETF peer funds, but were generally lower than the median of the expense ratios of the open-end (non-ETF) index peer funds and the median of the open-end actively-managed peer funds. The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds. The Board concluded that the advisory fee and expense ratio of each Fund are competitive and that the advisory fee for each Fund is reasonable and appropriate in amount in light of the quality of services provided and the expense cap in place.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability as well as any profits realized by the Adviser from its relationship to each Fund. The Trustees concluded that the profitability to the Adviser of the advisory services provided to the Funds is not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund's asset size, expense ratio, expense limitation agreed to by the Adviser and whether the investment process produced economies of scale. The Trustees noted that certain fixed costs associated with the management of the Funds are being reduced on a per-Fund basis as additional Funds are added, and that the gradual reduction of the per-Fund cost enabled the Adviser to operate some of the Funds under the expense cap, which potentially would lower the costs to shareholders. The Trustees noted that the Excess Expense Agreement with the Trust provided that the Adviser was entitled to be reimbursed by each Fund for fees waived or expenses absorbed pursuant to the expense cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its expense cap.
115
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds, and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
116
Board Considerations Regarding Approval of Investment
Advisory Agreement for the PowerShares FTSE NASDAQ Small Cap Portfolio
At a meeting held on October 2, 2007, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the "Trust"), including the Independent Trustees, approved the Investment Advisory Agreement between PowerShares Capital Management LLC (the "Adviser") and the Trust for the PowerShares FTSE NASDAQ Small Cap Portfolio (the "Fund").
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services to be provided, (ii) since Fund performance was not available, the correlation and tracking error between the indices tracked by other exchange-traded funds ("ETFs") for which the Adviser serves as such and those funds' performance, (iii) the costs of services to be provided and estimated profits to be realized by the Adviser, (iv) the extent to which economies of scale may be realized as the Fund grows, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered and amounts paid to other registered investment companies and (vii) any benefits to be realized by the Adviser from its relationship with the Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to appr ove the Investment Advisory Agreement for the Fund. No single factor was determinative in the Board's analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser's services, the Trustees reviewed information concerning the functions to be performed by the Adviser, information describing the Adviser's current organization and projected staffing, and the background and experience of the persons responsible for the day-to-day management of the Fund, and considered the quality of services provided by the Adviser to other ETFs. The Trustees reviewed matters related to the Adviser's portfolio transaction policies and procedures. The Trustees reviewed reports on the correlation and tracking error between the underlying indexes and the performance of other ETFs for which the Adviser serves as investment adviser.
The Trustees also considered the services to be provided by the Adviser in its oversight of the Fund's administrator, custodian and transfer agent. They noted the significant amount of time and effort that had been devoted to this oversight function for the other ETFs and that was expected to be provided for the Fund.
Based on their review, the Trustees concluded that the nature and extent of services to be provided by the Adviser to the Fund were appropriate and that the quality was expected to be good.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on the Fund's expected total expense ratio and proposed advisory fee, as compared to information prepared by Lipper Inc., an independent source, on expense ratios and advisory fees of a broad universe of ETFs and other index funds. The Adviser supplemented the information prepared by Lipper Inc. with data it compiled on expense ratios and advisory fees of newer ETFs that recently commenced operations. The Trustees also considered data from an August 2007 report by Morgan Stanley, Inc. showing average expense ratios for various types of ETFs and open-end funds, including index funds. The Trustees noted that the annual advisory fee to be charged to the Fund was a unitary fee, and that the Adviser agreed to pay all expenses of the Fund except bro kerage commissions and other trading expenses, taxes and extraordinary expenses. The Trustees noted that the advisory fees were generally at the higher end of the ETF universe, but were generally lower than fees for open-end (non-ETF) funds and closed-end funds, and were reasonable because of the complexity of the indices, which generally require more frequent rebalancing of the portfolios, the distinguishing factors of the Funds, and the higher administrative, operational and management oversight costs for the Adviser. The Trustees also noted that some of the higher advisory fees
117
Board Considerations Regarding Approval of Investment
Advisory Agreement for the PowerShares FTSE NASDAQ Small Cap Portfolio (Continued)
were attributable to higher license fees payable out of the unitary fee charged to the Funds. The Board noted that the Advisor represented that the advisory fees were competitive with those of their ETF peers. The Board concluded that the advisory fee and expected total expense ratio of each Fund are reasonable and appropriate in amount in light of the quality of services expected to be provided.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser as investment adviser to the other ETFs, as well as the fees waived and expenses reimbursed by the Adviser for those ETFs. The Trustees reviewed information provided by the Adviser on its profitability as well as any profits realized by the Adviser from its relationship to those ETFs. The Trustees noted the Adviser's statement that its costs of managing those ETFs generally exceeded the amount payable as management fees under the investment advisory agreement for those funds. The Trustees concluded that the estimated profits to be realized by the Adviser with respect to the Fund appeared to be reasonable in comparison with the costs of providing investment advisory services to the Fund.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as the Fund and other series of the Trust grow and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees noted that certain fixed costs associated with the management of the Fund can be reduced on a per-fund basis, and that although such economies would be enjoyed by the Adviser, a unitary fee provides certainty in expenses for the Fund. The Trustees considered whether the advisory fee rate for the Fund is reasonable in relation to the projected asset size of the Fund, and concluded that the flat advisory fee was reasonable and appropriate.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Fund, and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the Investment Advisory Agreement for the Fund. No single factor was determinative in the Board's analysis.
118
This page intentionally left blank
This page intentionally left blank
PROXY VOTING POLICIES AND PROCEDURES
A description of the Funds' proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 337-4246. This information is also available on the Securities and Exchange Commission's ("Commission") website at www.sec.gov.
Information regarding how the Funds voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 337-4246; or (ii) accessing the Funds' Form N-PX on the Commission's website at www.sec.gov.
QUARTERLY PORTFOLIOS
The Funds file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds' Forms N-Q are available on the Commission's website at www.sec.go v. The Funds' Forms N-Q may also be reviewed and copied at the Commission's Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
There are risks involved in investing in ETFs, including possible loss of money. Investing in securities of small and medium sized companies involves greater risk than is customarily associated with investing in more established companies, and investments in concentrated industry sectors involve greater risks than investments that are more diversified. PowerShares ETFs are not actively managed and are subject to risks similar to stocks, including those related to short selling and margin maintenance. PowerShares ETFs are not FDIC insured, may lose value and have no bank guarantee. PowerShares is a registered trademark of Invesco PowerShares Capital Management LLC. Past performance is not a guarantee of future results.
Invesco Aim Distributors, Inc. is the distributor of the PowerShares Exchange-Traded Fund Trust.
An investor should consider each Fund's investment objective, risks, charges and expenses carefully before investing. For more complete information about PowerShares ETFs call Invesco Aim Distributors, Inc. at (800) 337-4246 or visit our website invescopowershares.com for a prospectus. Please read the prospectus carefully before investing.
301 West Roosevelt Road
Wheaton, IL 60187
800.983.0903
www.invescopowershares.com
© 2008 Invesco PowerShares Capital Management LLC P-PS-AR-5
2008 Annual Report to Shareholders
30 April 2008
PowerShares Buyback AchieversTM Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares Financial Preferred Portfolio
PowerShares High Growth Rate Dividend
AchieversTM Portfolio
PowerShares High Yield Equity Dividend
AchieversTM Portfolio
PowerShares International Dividend
AchieversTM Portfolio
Table of Contents
Shareholder Letter | 2 | ||||||
The Market Environment | 3 | ||||||
Manager's Analysis | 4 | ||||||
Funds' Distribution History | 18 | ||||||
Frequency Distribution of Discounts & Premiums | 20 | ||||||
Fees and Expenses | 22 | ||||||
Dividend Income Portfolios | |||||||
Schedules of Investments | |||||||
PowerShares Buyback AchieversTM Portfolio | 24 | ||||||
PowerShares Dividend AchieversTM Portfolio | 28 | ||||||
PowerShares Financial Preferred Portfolio | 32 | ||||||
PowerShares High Growth Rate Dividend AchieversTM Portfolio | 33 | ||||||
PowerShares High Yield Equity Dividend AchieversTM Portfolio | 35 | ||||||
PowerShares International Dividend AchieversTM Portfolio | 36 | ||||||
Statements of Assets and Liabilities | 38 | ||||||
Statements of Operations | 40 | ||||||
Statements of Changes in Net Assets | 42 | ||||||
Financial Highlights | 44 | ||||||
Notes to Financial Statements | 47 | ||||||
Report of Independent Registered Public Accounting Firm | 57 | ||||||
Supplemental Information | 58 | ||||||
Information about Advisory Agreement | 64 | ||||||
To My Fellow Investors,
It gives me great pleasure to report on the state of your investment in PowerShares Exchange-Traded Funds and to thank you for your continued confidence in Invesco PowerShares Capital Management LLC.
Invesco PowerShares has accomplished a number of corporate and industry achievements in 2007. Some of the most notable successes over the past 12 months are that PowerShares:
• Was the first to receive approval from the SEC to operate actively managed equity and fixed-income ETFs.
• Launched our initial group of international ETFs, which invest directly in securities listed on foreign exchanges. As of April 30, 2008, we had 17 ETFs allowing investors to invest across a wide geographic range.
• Brought out the markets only ETFs investing in insured municipal bonds. These three ETF's were part of our initial entry into the Fixed Income portion of the investment spectrum.
• Further enhanced our reputation as one of the leading innovators in the ETF marketplace when the PowerShares S&P Buy-Write Portfolio was awarded the most innovative new ETF for 2007.
• Expanded our global footprint with the introduction of 14 PowerShares ETFs listed on four major stock exchanges across Europe (London, Milan, Frankfurt and Paris).
• Launched the PowerShares India Portfolio, one of the first ETFs to provide U.S. investors with direct access to securities listed on the India stock exchange.
Another milestone of the past year was the adoption of our new name, Invesco PowerShares – in short, we have a new corporate name. Invesco PowerShares represents the strength of global diversification you get through the combination of Invesco's worldwide resources and PowerShares' market leading ETF capabilities. As one of the world's largest and most diversified global investment organizations, Invesco has more than 500 investment professionals operating in investment centers in 25 cities, a presence in 12 countries and $500 billion in assets under management globally at the end of 2007.
While our name has changed and we have a new corporate logo, our goal of delivering the highest quality investment management available in the ETF structure has not changed and all of the names of your funds and their trading symbols remain the same – as do all of our telephone contact numbers. All of us at Invesco PowerShares will continue to strive to provide you with compelling investment solutions and high-quality customer service. Regardless of market conditions, Invesco PowerShares will hold true to its mission: seeking to build financial security for investors.
Best regards,
H. Bruce Bond
President and Chairman of the Board of Trustees
PowerShares Exchange-Traded Fund Trust
2
The Market Environment
Although the benchmark S&P 500 index hit an all-time high in October, 2007, it capitulated as the subprime mortgage crisis began to negatively affect the balance sheets of major U.S. financial institutions. As a result, volatility (as measured by the CBOE "VIX" index) increased by 46.2% during the April 30, 2007 to April 30, 2008 reporting period. Another dramatic rise over the same timeframe was the price of crude oil, which rallied 72.7%. U.S. economic growth began to slow significantly in Q1 2008, leading to recession concerns addressed by the Federal Reserve Bank through aggressive monetary policy easing (the Fed Fund target rate was cut by 2.25% in 2008). The combination of lower short-term U.S. interest rates and the recycling of petrodollars into European banks caused the U.S. dollar to weaken versus all G7 currencies for the year ended April 30, 2008.
By March, 2008, even the AAA-rated monoline bond insurers succumbed to the U.S. credit crunch. Bond insurer ratings downgrades led to huge displacements within the municipal bond market. An impending liquidity crisis was quelled in mid-March by the Fed via the creation of a $200bn lending facility and the approval of Bear Stearns' sale to JP Morgan. Along with the restoration of confidence in the U.S. financial system came a respectable April rally in the U.S. equity market, leaving the S&P 500 with a yearly total return of -4.68% over the reporting period while the DJIA was 0.47% and the NASDAQ-100 was +3.18%. For the same period, the Lehman Brothers U.S. Aggregate Total Return bond index was 6.87%.
3
Manager's Analysis
PowerShares Buyback AchieversTM Portfolio (ticker: PKW)
The PowerShares Buyback Achievers Portfolio is based on the Share BuyBack AchieversTM Index and seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index. To become eligible for inclusion in the Index, a company must be incorporated in the U.S., trade on a U.S. exchange and must have repurchased at least 5% or more of its outstanding shares for the trailing 12 months.
For the year ended April 30, 2008, the Fund decreased in value by -12.53%. For the same period, the S&P 500® Index decreased by -4.68%.
For the year ended April 30, 2008, three of the ten sectors represented in the Fund generated positive returns. Overexposure in the consumer discretionary sector and stock selection in the energy, materials, health care, and consumer staples sectors made the largest negative contribution to the performance of the Fund relative to the broader U.S. equity market. However, underexposure and stock selection in the financials sector made the largest positive contribution to the performance of the Fund relative to the broader U.S. equity market.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Consumer Discretionary | 23.3 | ||||||
Information Technology | 19.9 | ||||||
Financials | 15.4 | ||||||
Health Care | 14.4 | ||||||
Energy | 8.6 | ||||||
Industrials | 7.3 | ||||||
Consumer Staples | 5.0 | ||||||
Utilities | 3.3 | ||||||
Materials | 2.4 | ||||||
Telecommunication Services | 0.5 | ||||||
Money Market Fund | 0.3 | ||||||
Other | (0.4 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 47.4 | ||||||
Large-Cap Growth | 25.3 | ||||||
Mid-Cap Value | 10.6 | ||||||
Mid-Cap Growth | 10.0 | ||||||
Small-Cap Value | 4.6 | ||||||
Small-Cap Growth | 2.1 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Exxon Mobil Corp. | 5.1 | ||||||
Pfizer, Inc. | 5.0 | ||||||
International Business Machines Corp. | 5.0 | ||||||
Hewlett-Packard Co. | 4.9 | ||||||
Goldman Sachs Group (The), Inc. | 3.9 | ||||||
Walt Disney (The) Co. | 3.0 | ||||||
Time Warner, Inc. | 2.6 | ||||||
Home Depot (The), Inc. | 2.3 | ||||||
Kraft Foods, Inc., Class A | 2.3 | ||||||
Amgen, Inc. | 2.2 | ||||||
Total | 36.3 |
4
Manager's Analysis (Continued)
PowerShares Buyback AchieversTM Portfolio (ticker: PKW)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Fund Inception | |||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Share BuyBack AchieversTM Index | -11.69 | -5.74 | -7.76 | ||||||||||||
S&P 500® Index | -4.68 | -0.09 | -0.12 | ||||||||||||
Russell 1000® Index | -4.62 | 0.21 | 0.29 |
Fund
NAV Return | -12.53 | -6.64 | -8.91 | ||||||||||||
Share Price Return | -13.07 | -6.93 | -9.31 |
Fund Inception: 20 December 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.23%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.73% while the Fund's gross total operating expense ratio was 0.79%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index and Russell 1000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 500 and 1,000 common stocks, respectively.
† Average annualized.
5
Manager's Analysis
PowerShares Dividend AchieversTM Portfolio (ticker: PFM)
The PowerShares Dividend Achievers Portfolio is based on the Broad Dividend AchieversTM Index and seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The Broad Dividend AchieversTM Index is designed to track the performance of companies that meet the requirements to be classified as "Dividend AchieversTM." To become eligible for inclusion in the Broad Dividend Achievers(TM) Index, a company must be incorporated in the United States or its territories, trade on the New York Stock Exchange, NASDAQ or American Stock Exchange, and must have raised its annual regular cash dividend payments for at least each of the last ten consecutive fiscal years.
For the year ended April 30, 2008, the Fund decreased in value by -6.00%. For the same period, the S&P 500® Index decreased by -4.68%.
For the year ended April 30, 2008, four of the ten sectors represented in the Fund generated positive returns. Underexposure in the energy sector and overexposure in the financial sector made the largest negative contribution to the performance of the Fund relative to the broader US equity market. However, overexposure in consumer staples and stock selection in health care and consumer discretionary made the largest positive contribution to the performance of the Fund relative to the broader US equity market.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 22.9 | ||||||
Consumer Staples | 21.5 | ||||||
Industrials | 13.1 | ||||||
Health Care | 12.0 | ||||||
Energy | 9.4 | ||||||
Consumer Discretionary | 6.6 | ||||||
Telecommunication Services | 4.7 | ||||||
Information Technology | 4.4 | ||||||
Materials | 2.8 | ||||||
Utilities | 2.1 | ||||||
Money Market Fund | 0.4 | ||||||
Other | 0.1 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 61.7 | ||||||
Large-Cap Growth | 23.7 | ||||||
Mid-Cap Value | 9.1 | ||||||
Mid-Cap Growth | 3.1 | ||||||
Small-Cap Value | 2.0 | ||||||
Small-Cap Growth | 0.4 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Exxon Mobil Corp. | 4.9 | ||||||
General Electric Co. | 4.8 | ||||||
AT&T, Inc. | 4.6 | ||||||
Wal-Mart Stores, Inc. | 4.5 | ||||||
Procter & Gamble (The) Co. | 4.1 | ||||||
Chevron Corp. | 3.9 | ||||||
Johnson & Johnson | 3.8 | ||||||
Bank of America Corp. | 3.3 | ||||||
International Business Machines Corp. | 3.3 | ||||||
Coca-Cola (The) Co. | 2.7 | ||||||
Total | 39.9 |
6
Manager's Analysis (Continued)
PowerShares Dividend AchieversTM Portfolio (ticker: PFM)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Broad Dividend AchieversTM Index | -5.66 | 5.73 | 15.80 | ||||||||||||
S&P 500® Index | -4.68 | 6.70 | 18.59 | ||||||||||||
Dow Jones Industrial Average Index | 0.47 | 10.15 | 28.96 |
Fund
NAV Return | -6.00 | 5.24 | 14.33 | ||||||||||||
Share Price Return | -6.55 | 5.05 | 13.80 |
Fund Inception: 15 September 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.89%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.60% while the Fund's gross total operating expense ratio was 0.72%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index and Dow Jones Industrial Average Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 500 and 30 common stocks, respectively.
† Average annualized.
7
Manager's Analysis
PowerShares Financial Preferred Portfolio (ticker: PGF)
The PowerShares Financial Preferred Portfolio is based on the Wachovia Hybrid & Preferred Securities Financial Index (WHPSSM Financial Index). The Index tracks the performance of U.S. listed preferred stocks issued in the US market by financial institutions and currently includes approximately 46 securities selected by Wachovia pursuant to a proprietary selection methodology. The market-capitalization weighted Index is rebalanced monthly.
For the year ended April 30, 2008, the Fund decreased -8.77%. Over this same period the WHPSSM Financial Index decreased by -6.27% and the S&P500® Index decreased by -4.68%. Because the WHPSSM Financial Index does not comply with the tax diversification requirements to which the Fund must adhere, a sampling methodology was utilized to help the Fund achieve its investment objective of tracking the index before fees and expenses. This was one reason for the difference between the Fund and the WHPSSM Financial Index performance, beyond regular Fund expenses, was due to the fund's representative sampling. A portion of this difference can also be attributed to the negative impact of buying and selling preferred securities with relatively wide (versus common stock) bid/ask spreads at the monthly rebalances.
Despite a strong rebound in January 2008, the financial sector was the weakest sector of the S&P500 GICS (Global Industry Classification Standard) for the year ended April 30, 2008. The Fund and the WHPSSM Financial Index suffered significant losses over the past year since 100% of the holdings are financial preferred securities. Record high levels of new preferred securities were issued in the second quarter of 2007 and April in 2008 based on the enormous need for capital replacement by financial institutions who had written off billions in bad debt. As a result of the huge new supply that flooded the preferred security marketplace, option-adjusted spreads widened to historically high levels during the reporting timeframe. Thus the financial preferred market was negatively affected by both sector weakness and new supply strength.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Banks | 45.8 | ||||||
Insurance | 40.1 | ||||||
Diversified Financial Services | 14.4 | ||||||
Money Market Fund | 0.2 | ||||||
Other | (0.5 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Small-Cap Value | 75.50 | ||||||
Large-Cap Value | 24.50 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Royal Bank of Scotland Group PLC, 7.25%, Series T (United Kingdom) | 6.7 | ||||||
ING Groep N.V., 7.38% (Netherlands) | 6.4 | ||||||
MetLife, Inc., 6.50%, Series B | 4.5 | ||||||
HSBC Holdings PLC, 6.20%, Series A (United Kingdom) | 4.4 | ||||||
Goldman Sachs Group, Inc., 6.20%, Series B | 4.4 | ||||||
Wachovia Corp., 8.0%, Series J | 4.3 | ||||||
Aegon N.V., 7.25% (Netherlands) | 4.3 | ||||||
Barclays Bank PLC, 7.75% (United Kingdom) | 4.3 | ||||||
ING Groep N.V., 6.38% (Netherlands) | 4.0 | ||||||
ACE Ltd., 7.80%, Series C | 3.6 | ||||||
Total | 46.9 |
8
Manager's Analysis (Continued)
PowerShares Financial Preferred Portfolio (ticker: PGF)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Wachovia Hybrid & Preferred Securities Financial Index | -6.27 | -3.48 | -4.89 | ||||||||||||
Lehman Aggregate U.S. Corporate Bond Index | 1.68 | 2.58 | 3.67 | ||||||||||||
S&P 500® Index | -4.68 | 1.32 | 1.87 |
Fund
NAV Return | -8.77 | -5.52 | -7.69 | ||||||||||||
Share Price Return | -10.77 | -7.21 | -10.04 |
Fund Inception: 01 December 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.00%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.72% while the Fund's gross total operating expense ratio was 0.74%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Lehman Aggregate U.S. Corporate Bond Index and S&P 500® Index are unmanaged indices used as a measurement of change in market conditions based on the average performance of approximately 1,500 bonds and 500 common stocks, respectively.
† Average annualized.
9
Manager's Analysis
PowerShares High Growth Rate Dividend AchieversTM Portfolio (ticker: PHJ)
The PowerShares High Growth Rate Dividend Achievers Portfolio is based on the High Growth Rate Dividend AchieversTM Index and seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The High Growth Rate Dividend AchieversTM Index is designed to track the performance of the 100 companies with the highest annual dividend growth rate over the last ten years that meet the requirements to be classified as "High Growth Rate Dividend AchieversTM." To become eligible for inclusion in the High Growth Rate Dividend AchieversTM Index, a company must be incorporated in the United States or its territories, trade on the NYSE, NASDAQ or AMEX, and its aggregate annual regular dividend payments must have increased consistently over the course of the last ten or more fiscal years.
For the year ended April 30, 2008, the Fund decreased in value by -10.58%. For the same period, the S&P 500® Index decreased by -4.68%.
For the year ended April 30, 2008, six of the ten sectors represented in the Fund generated positive returns. Underexposure in the energy sector and overexposure in the financial sector made the largest negative contribution to the performance of the Fund relative to the broader US equity market. However, stock selection in consumer discretionary, materials and health care all made the largest positive contribution to the performance of the Fund relative to the broader US equity market.
10
Manager's Analysis (Continued)
PowerShares High Growth Rate Dividend AchieversTM Portfolio (ticker: PHJ)
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Banks | 17.0 | ||||||
Retail | 16.6 | ||||||
Healthcare-Products | 11.7 | ||||||
Insurance | 10.4 | ||||||
Diversified Financial Services | 9.4 | ||||||
Pharmaceuticals | 5.4 | ||||||
Miscellaneous Manufacturing | 4.5 | ||||||
Computers | 4.2 | ||||||
Aerospace/Defense | 4.0 | ||||||
Commercial Services | 3.1 | ||||||
Chemicals | 2.7 | ||||||
Iron/Steel | 1.6 | ||||||
Transportation | 1.6 | ||||||
Food | 1.4 | ||||||
Pipelines | 1.1 | ||||||
Savings & Loans | 1.0 | ||||||
Leisure Time | 0.8 | ||||||
Semiconductors | 0.6 | ||||||
Investment Companies | 0.5 | ||||||
Home Builders | 0.4 | ||||||
Real Estate | 0.3 | ||||||
REIT | 0.3 | ||||||
Software | 0.3 | ||||||
Textiles | 0.3 | ||||||
Media | 0.2 | ||||||
Oil & Gas | 0.2 | ||||||
Advertising | 0.1 | ||||||
Apparel | 0.1 | ||||||
Distribution/Wholesale | 0.1 | ||||||
Environmental Control | 0.1 | ||||||
Building Materials | 0.0 | ||||||
Telecommunications | 0.0 | ||||||
Money Market Fund | 0.6 | ||||||
Other | (0.6 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Wal-Mart Stores, Inc. | 4.1 | ||||||
McDonald's Corp. | 4.1 | ||||||
Johnson & Johnson | 4.1 | ||||||
Pfizer, Inc. | 4.0 | ||||||
United Technologies Corp. | 4.0 | ||||||
International Business Machines Corp. | 4.0 | ||||||
Bank of America Corp. | 4.0 | ||||||
American International Group, Inc. | 4.0 | ||||||
Wells Fargo & Co. | 4.0 | ||||||
U.S. Bancorp | 4.0 | ||||||
Total | 40.3 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 57.5 | ||||||
Large-Cap Growth | 27.0 | ||||||
Mid-Cap Value | 9.1 | ||||||
Mid-Cap Growth | 4.7 | ||||||
Small-Cap Value | 1.5 | ||||||
Small-Cap Growth | 0.2 |
11
Manager's Analysis (Continued)
PowerShares High Growth Rate Dividend AchieversTM Portfolio (ticker: PHJ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
High Growth Rate Dividend AchieversTM Index | -10.09 | 2.50 | 6.70 | ||||||||||||
Dow Jones Industrial Average Index | 0.47 | 10.15 | 28.96 | ||||||||||||
S&P 500® Index | -4.68 | 6.70 | 18.59 |
Fund
NAV Return | -10.58 | 1.79 | 4.77 | ||||||||||||
Share Price Return | -10.98 | 1.64 | 4.37 |
Fund Inception: 15 September 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.99%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.60% while the Fund's gross total operating expense ratio was 0.89%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Dow Jones Industrials Average Index and S&P 500® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 30 and 500 common stocks, respectively.
† Average annualized.
12
This page intentionally left blank
Manager's Analysis
PowerShares High Yield Equity Dividend AchieversTM Portfolio (ticker: PEY)
The PowerShares High Yield Equity Dividend AchieversTM Portfolio is based on the Mergent Dividend AchieversTM 50 Index. The Mergent Dividend AchieversTM 50 Index seeks to deliver high current income and capital appreciation. It is comprised of the fifty highest yielding companies with at least ten years of consecutive dividend increases. The index's high dividend yield approach provides exposure to deep value companies while the long-term dividend growth requirement attempts to minimize exposure to distressed value companies. The yield weighted component of the Index is rebalanced quarterly and reconstituted annually.
For the year ended April 30, 2008, the Fund decreased in value by -24.67%. For the same period, the Russell 3000 Value Index decreased by -9.45% and the Dow Jones Select Dividend Index decreased by -15.75%.
For the year ended April 30, 2008, three of the ten sectors represented in the Fund generated positive returns. Overexposure in the financial sector and underexposure in consumer staples and material sectors made the largest negative contribution to the performance of the Fund relative to the broader US equity market. However, overexposure in the healthcare sector and stock selection in the industrials sector made the largest positive contribution to the performance of the Fund relative to the broader US equity market.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Banks | 66.4 | ||||||
Electric | 9.2 | ||||||
Investment Companies | 4.2 | ||||||
Media | 4.0 | ||||||
Savings & Loans | 3.6 | ||||||
Gas | 3.5 | ||||||
Miscellaneous Manufacturing | 2.2 | ||||||
Pharmaceuticals | 2.1 | ||||||
Diversified Financial Services | 2.0 | ||||||
Insurance | 1.9 | ||||||
Retail | 1.8 | ||||||
Home Builders | 1.2 | ||||||
Home Furnishings | 0.6 | ||||||
Money Market Fund | 0.5 | ||||||
Other | (3.2 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Small-Cap Value | 43.1 | ||||||
Mid-Cap Value | 38.9 | ||||||
Large-Cap Value | 16.3 | ||||||
Small-Cap Growth | 1.7 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Provident Bankshares Corp. | 4.3 | ||||||
American Capital Strategies Ltd. | 4.2 | ||||||
Royal Bancshares of Pennsylvania, Class A | 3.1 | ||||||
Fifth Third Bancorp | 2.9 | ||||||
National City Corp. | 2.9 | ||||||
Corus Bankshares, Inc. | 2.8 | ||||||
Independent Bank Corp. | 2.8 | ||||||
Colonial BancGroup (The), Inc. | 2.7 | ||||||
Comerica, Inc. | 2.6 | ||||||
Park National Corp. | 2.5 | ||||||
Total | 30.8 |
14
Manager's Analysis (Continued)
PowerShares High Yield Equity Dividend AchieversTM Portfolio (ticker: PEY)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dividend AchieversTM 50 Index | -26.36 | -4.79 | -15.37 | ||||||||||||
S&P 500® Index | -4.68 | 6.56 | 24.13 | ||||||||||||
S&P Citigroup Large Cap Value Index | -8.76 | 7.12 | 26.34 |
Fund
NAV Return | -24.67 | -3.84 | -12.44 | ||||||||||||
Share Price Return | -25.73 | -4.29 | -13.81 |
Fund Inception: 9 December 2004
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.59%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.60% while the Fund's gross total operating expense ratio was 0.56%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index and S&P Citigroup Large Cap Value Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 500 and 346 common stocks, respectively.
† Average annualized.
15
Manager's Analysis
PowerShares International Dividend AchieversTM Portfolio (ticker: PID)
The PowerShares International Dividend Achievers Portfolio is based on the International Dividend AchieversTM Index and seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The International Dividend AchieversTM Index is designed to track the performance of dividend paying American Depositary Receipts and non-U.S. common or ordinary stocks trading on the NYSE, NASDAQ or AMEX. To become eligible for inclusion in the International Dividend AchieversTM Index, a company's aggregate annual regular dividend payments must have increased consistently over the course of the last five calendar or fiscal years.
For the year ended April 30, 2008, the Fund increased in value by 0.34%. For the same period, the MSCI EAFE Index decreased by -1.78%.
Peru, Australia and China were the largest positive contributors while the United Kingdom, Ireland and Hong Kong were the largest negative contributors to the Fund's performance. Seven of the ten industry sectors represented in the Fund generated positive returns. Overexposure in the financial sector made the largest positive contribution to the performance of the Fund relative to the broader US equity market. Underexposure in the information technology and industrial sectors made the largest negative contribution to the performance of the Fund relative to the broader US equity market.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 34.7 | ||||||
Consumer Discretionary | 14.5 | ||||||
Energy | 13.0 | ||||||
Telecommunication Services | 8.2 | ||||||
Consumer Staples | 7.2 | ||||||
Industrials | 6.5 | ||||||
Utilities | 4.9 | ||||||
Information Technology | 4.0 | ||||||
Materials | 3.8 | ||||||
Health Care | 3.3 | ||||||
Money Market Fund | 0.1 | ||||||
Other | (0.2 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 50.8 | ||||||
Large-Cap Growth | 32.1 | ||||||
Mid-Cap Value | 11.4 | ||||||
Mid-Cap Growth | 2.7 | ||||||
Small-Cap Growth | 2.5 | ||||||
Small-Cap Value | 0.5 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Tomkins PLC ADR | 2.8 | ||||||
Barclays PLC ADR | 2.7 | ||||||
BT Group PLC ADR | 2.7 | ||||||
Signet Group PLC ADR | 2.4 | ||||||
Bank of Montreal | 2.4 | ||||||
Bank of Ireland ADR | 2.2 | ||||||
HSBC Holdings PLC ADR | 2.1 | ||||||
Canadian Imperial Bank of Commerce | 2.1 | ||||||
Huaneng Power International, Inc. ADR | 2.0 | ||||||
Allied Irish Banks PLC ADR | 2.0 | ||||||
Total | 23.4 |
16
Manager's Analysis (Continued)
PowerShares International Dividend AchieversTM Portfolio (ticker: PID)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
International Dividend AchieversTM Index | 0.30 | 13.67 | 40.10 | ||||||||||||
MSCI EAFE Index | -1.78 | 14.45 | 42.62 | ||||||||||||
S&P 500® Index | -4.68 | 6.70 | 18.59 |
Fund
NAV Return | 0.34 | 13.94 | 40.81 | ||||||||||||
Share Price Return | -0.89 | 13.40 | 39.12 |
Fund Inception: 15 September 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.63%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.58% while the Fund's gross total operating expense ratio was 0.56%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The MSCI EAFE Index and S&P 500® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 1,137 and 500 common stocks, respectively.
† Average annualized.
17
Funds' Distribution History
Ex-Dividend | 4/15/08 | 3/20/08 | 3/14/08 | 2/15/08 | 1/15/08 | 12/21/07 | 12/14/07 | ||||||||||||||||||||||||||||
Record | 4/17/08 | 3/25/08 | 3/18/08 | 2/19/08 | 1/17/08 | 12/26/07 | 12/18/07 | ||||||||||||||||||||||||||||
Payable | 4/30/08 | 3/31/08 | 3/31/08 | 2/29/08 | 1/31/08 | 12/31/07 | 12/31/07 | ||||||||||||||||||||||||||||
Fund | Ticker | ||||||||||||||||||||||||||||||||||
PowerShares Buyback AchieversTM Portfolio | PKW | — | 0.05160 | — | — | — | 0.02352 | — | |||||||||||||||||||||||||||
PowerShares Dividend AchieversTM Portfolio | PFM | — | 0.07949 | — | — | — | 0.11379 | — | |||||||||||||||||||||||||||
PowerShares Financial Preferred Portfolio | PGF | 0.12384 | — | 0.12397 | 0.12405 | 0.12478 | — | 0.18870 | |||||||||||||||||||||||||||
PowerShares High Growth Rate Dividend AchieversTM Portfolio | PHJ | — | 0.05028 | — | — | — | 0.12561 | — | |||||||||||||||||||||||||||
PowerShares High Yield Equity Dividend AchieversTM Portfolio | PEY | 0.05055 | — | 0.05074 | 0.05235 | 0.05020 | — | 0.09772 | |||||||||||||||||||||||||||
PowerShares International Dividend AchieversTM Portfolio | PID | — | 0.19796 | — | — | — | 0.11408 | — | |||||||||||||||||||||||||||
Ex-Dividend | 4/13/07 | 3/16/07 | 3/15/07 | 2/15/07 | 1/12/07 | 12/15/06 | 11/15/06 | ||||||||||||||||||||||||||||
Record | 4/17/07 | 3/20/07 | 3/20/07 | 2/20/07 | 1/16/07 | 12/19/06 | 11/17/06 | ||||||||||||||||||||||||||||
Payable | 4/30/07 | 3/30/07 | 3/30/07 | 2/28/07 | 1/31/07 | 12/29/06 | 11/30/06 | ||||||||||||||||||||||||||||
Fund | Ticker | ||||||||||||||||||||||||||||||||||
PowerShares Buyback AchieversTM Portfolio | PKW | — | 0.02102 | — | — | — | NA | NA | |||||||||||||||||||||||||||
PowerShares Dividend AchieverTM Portfolio | PFM | — | 0.07520 | — | — | — | 0.11050 | — | |||||||||||||||||||||||||||
PowerShares Financial Preferred Portfolio | PGF | 0.11205 | — | 0.11020 | 0.11250 | 0.11260 | 0.18568 | NA | |||||||||||||||||||||||||||
PowerShares High Growth Rate Dividend AchieversTM Portfolio | PHJ | — | 0.07020 | — | — | — | 0.13210 | — | |||||||||||||||||||||||||||
PowerShares High Yield Equity Dividend AchieversTM Portfolio | PEY | 0.05003 | — | 0.05020 | 0.05006 | 0.05012 | 0.06648 | 0.05501 | |||||||||||||||||||||||||||
PowerShares International Dividend AchieversTM Portfolio | PID | — | 0.11020 | — | — | — | 0.16748 | — | |||||||||||||||||||||||||||
Ex-Dividend | 12/16/05 | 9/16/05 | 6/17/05 | ||||||||||||||||||||||||||||||||
Record | 12/20/05 | 9/20/05 | 6/21/05 | ||||||||||||||||||||||||||||||||
Payable | 12/30/05 | 9/30/05 | 6/30/05 | ||||||||||||||||||||||||||||||||
Fund | Ticker | ||||||||||||||||||||||||||||||||||
PowerShares Buyback AchieversTM Portfolio | PKW | NA | NA | NA | |||||||||||||||||||||||||||||||
PowerShares Dividend AchieversTM Portfolio | PFM | 0.08740 | — | NA | |||||||||||||||||||||||||||||||
PowerShares Financial Preferred Portfolio | PGF | NA | NA | NA | |||||||||||||||||||||||||||||||
PowerShares High Growth Rate Dividend AchieversTM Portfolio | PHJ | 0.08594 | — | NA | |||||||||||||||||||||||||||||||
PowerShares High Yield Equity Dividend AchieversTM Portfolio | PEY | 0.11320 | 0.11490 | 0.12828 | |||||||||||||||||||||||||||||||
PowerShares International Dividend AchieversTM Portfolio | PID | 0.07747 | NA | NA |
18
11/15/07 | 10/15/07 | 9/21/07 | 9/14/07 | 8/15/07 | 7/13/07 | 6/15/07 | 5/15/07 | ||||||||||||||||||||||||||||
11/19/07 | 10/17/07 | 9/25/07 | 9/18/07 | 8/17/07 | 7/17/07 | 6/19/07 | 5/17/07 | ||||||||||||||||||||||||||||
11/30/07 | 10/31/07 | 9/28/07 | 9/28/07 | 8/31/07 | 7/31/07 | 6/29/07 | 5/31/07 | ||||||||||||||||||||||||||||
Fund | |||||||||||||||||||||||||||||||||||
PowerShares Buyback AchieversTM Portfolio | — | — | 0.01037 | — | — | — | 0.01102 | — | |||||||||||||||||||||||||||
PowerShares Dividend AchieversTM Portfolio | — | — | 0.08586 | — | — | — | 0.05524 | — | |||||||||||||||||||||||||||
PowerShares Financial Preferred Portfolio | 0.11423 | 0.08669 | — | 0.11516 | 0.11319 | 0.11325 | 0.11307 | 0.11540 | |||||||||||||||||||||||||||
PowerShares High Growth Rate Dividend AchieversTM Portfolio | — | — | 0.07169 | — | — | — | 0.04519 | — | |||||||||||||||||||||||||||
PowerShares High Yield Equity Dividend AchieversTM Portfolio | 0.05103 | 0.05059 | — | 0.05180 | 0.05006 | 0.05003 | 0.05005 | 0.05007 | |||||||||||||||||||||||||||
PowerShares International Dividend AchieversTM Portfolio | — | — | 0.10051 | — | — | — | 0.14313 | — | |||||||||||||||||||||||||||
10/13/06 | 9/15/06 | 8/15/06 | 7/14/06 | 6/16/06 | 6/15/06 | 5/15/06 | 3/17/06 | ||||||||||||||||||||||||||||
10/17/06 | 9/16/06 | 8/17/06 | 7/18/06 | 6/20/06 | 6/19/06 | 5/17/06 | 3/21/06 | ||||||||||||||||||||||||||||
10/31/06 | 9/29/06 | 8/31/06 | 7/31/06 | 6/30/06 | 6/30/06 | 5/31/06 | 3/30/06 | ||||||||||||||||||||||||||||
Fund | |||||||||||||||||||||||||||||||||||
PowerShares Buyback AchieversTM Portfolio | NA | NA | NA | NA | NA | NA | NA | NA | |||||||||||||||||||||||||||
PowerShares Dividend AchieverTM Portfolio | — | 0.05029 | — | — | 0.07671 | — | — | 0.07660 | |||||||||||||||||||||||||||
PowerShares Financial Preferred Portfolio | NA | NA | NA | NA | NA | NA | NA | NA | |||||||||||||||||||||||||||
PowerShares High Growth Rate Dividend AchieversTM Portfolio | — | 0.03428 | — | — | 0.06068 | — | — | 0.05916 | |||||||||||||||||||||||||||
PowerShares High Yield Equity Dividend AchieversTM Portfolio | 0.05529 | 0.05518 | 0.05512 | 0.05523 | — | 0.04512 | 0.03950 | 0.12300 | |||||||||||||||||||||||||||
PowerShares International Dividend AchieversTM Portfolio | — | 0.12589 | — | — | 0.12567 | — | — | 0.11910 | |||||||||||||||||||||||||||
4/1/05 | 3/18/05 | 12/31/04 | 12/17/04 | ||||||||||||||||||||||||||||||||
4/5/05 | 3/22/05 | 1/4/05 | 12/21/04 | ||||||||||||||||||||||||||||||||
4/29/05 | 4/29/05 | 1/31/05 | 1/31/05 | ||||||||||||||||||||||||||||||||
Fund | |||||||||||||||||||||||||||||||||||
PowerShares Buyback AchieversTM Portfolio | NA | NA | NA | NA | |||||||||||||||||||||||||||||||
PowerShares Dividend AchieversTM Portfolio | NA | NA | NA | NA | |||||||||||||||||||||||||||||||
PowerShares Financial Preferred Portfolio | NA | NA | NA | NA | |||||||||||||||||||||||||||||||
PowerShares High Growth Rate Dividend AchieversTM Portfolio | NA | NA | NA | NA | |||||||||||||||||||||||||||||||
PowerShares High Yield Equity Dividend AchieversTM Portfolio | 0.03688 | 0.09700 | 0.00859 | 0.02742 | |||||||||||||||||||||||||||||||
PowerShares International Dividend AchieversTM Portfolio | NA | NA | NA | NA |
19
Frequency Distribution of Discounts & Premiums
Since Inception through April 30, 2008
Closing Price Above NAV (bps) | |||||||||||||||||||||||||||||||||||||||
Ticker | Fund Name | Inception | Days | 0-24 | 25-49 | 50-99 | 100-149 | 150-199 | 200+ | ||||||||||||||||||||||||||||||
PKW | PowerShares Buyback AchieversTM Portfolio | 12/20/06 | 341 | 154 | 29 | 4 | — | — | — | ||||||||||||||||||||||||||||||
PFM | PowerShares Dividend AchieversTM Portfolio | 9/15/05 | 660 | 375 | 44 | 1 | — | — | — | ||||||||||||||||||||||||||||||
PGF | PowerShares Financial Preferred Portfolio | 12/1/06 | 354 | 179 | 107 | 28 | 2 | — | — | ||||||||||||||||||||||||||||||
PHJ | PowerShares High Growth Rate Dividend AchieversTM Portfolio | 9/15/05 | 660 | 361 | 25 | 3 | — | — | — | ||||||||||||||||||||||||||||||
PEY | PowerShares High Yield Equity Dividend AchieversTM Portfolio | 12/9/04 | 853 | 346 | 21 | — | — | — | — | ||||||||||||||||||||||||||||||
PID | PowerShares International Dividend AchieversTM Portfolio | 9/15/05 | 660 | 379 | 28 | 7 | — | — | 1 |
20
Closing Price Below NAV (bps) | |||||||||||||||||||||||||||
Ticker | -0-24 | -25-49 | -50-99 | -100-149 | -150-199 | -200+ | |||||||||||||||||||||
PKW | 150 | 4 | — | — | — | — | |||||||||||||||||||||
PFM | 238 | 2 | — | — | — | — | |||||||||||||||||||||
PGF | 37 | 1 | — | — | — | — | |||||||||||||||||||||
PHJ | 263 | 8 | — | — | — | — | |||||||||||||||||||||
PEY | 423 | 56 | 6 | 1 | — | — | |||||||||||||||||||||
PID | 223 | 16 | 6 | — | — | — |
21
Fees and Expenses
As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, you incur Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month period ended April 30, 2008.
Actual Expenses
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, 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 first line under the heading "Expenses Paid During the Six-Month Period" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds' actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Funds' 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 Funds 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 tables are meant to highlight your ongoing costs only, and do not reflect any transactional costs such as sales charges (loads). Therefore the second line in the table 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 transactional costs were included, your costs would have been higher.
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Buyback AchieversTM Portfolio Actual | $ | 1,000.00 | $ | 867.66 | 0.72 | % | $ | 3.34 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.28 | 0.72 | % | $ | 3.62 | |||||||||||
PowerShares Dividend AchieversTM Portfolio Actual | $ | 1,000.00 | $ | 926.83 | 0.60 | % | $ | 2.87 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.88 | 0.60 | % | $ | 3.02 | |||||||||||
PowerShares Financial Preferred Portfolio | |||||||||||||||||||
Actual | $ | 1,000.00 | $ | 970.98 | 0.71 | % | $ | 3.48 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.33 | 0.71 | % | $ | 3.57 | |||||||||||
PowerShares High Growth Rate Dividend AchieversTM Portfolio Actual | $ | 1,000.00 | $ | 910.21 | 0.60 | % | $ | 2.85 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.88 | 0.60 | % | $ | 3.02 |
22
Fees and Expenses (Continued)
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares High Yield Equity Dividend AchieversTM Portfolio Actual | $ | 1,000.00 | $ | 805.64 | 0.60 | % | $ | 2.69 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.88 | 0.60 | % | $ | 3.02 | |||||||||||
PowerShares International Dividend AchieversTM Portfolio Actual | $ | 1,000.00 | $ | 890.42 | 0.56 | % | $ | 2.63 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.08 | 0.56 | % | $ | 2.82 |
(1) Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six months ended April 30, 2008. Expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 182 and then dividing the result by 366. Expense ratios for the most recent half-year may differ from expense ratios based on the one year data in the Financial Highlights.
23
Schedule of Investments
PowerShares Buyback AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests—100.1% | |||||||||||
Consumer Discretionary—23.3% | |||||||||||
1,964 | Aeropostale, Inc.* | $ | 62,436 | ||||||||
743 | AFC Enterprises, Inc.* | 7,690 | |||||||||
152 | Aldila, Inc. | 1,670 | |||||||||
563 | Ambassadors Group, Inc. | 10,956 | |||||||||
1,435 | American Greetings Corp., Class A | 25,687 | |||||||||
1,796 | AnnTaylor Stores Corp.* | 45,439 | |||||||||
528 | Arctic Cat, Inc. | 4,002 | |||||||||
5,254 | AutoNation, Inc.* | 84,117 | |||||||||
1,860 | AutoZone, Inc.* | 224,595 | |||||||||
1,613 | Barnes & Noble, Inc. | 52,068 | |||||||||
7,709 | Bed Bath & Beyond, Inc.* | 250,543 | |||||||||
12,345 | Best Buy Co., Inc. | 531,082 | |||||||||
2,395 | Big Lots, Inc.* | 64,737 | |||||||||
1,793 | Black & Decker (The) Corp. | 117,675 | |||||||||
1,066 | Blyth, Inc. | 17,951 | |||||||||
2,978 | Brinker International, Inc. | 67,571 | |||||||||
1,950 | Callaway Golf Co. | 26,793 | |||||||||
652 | CBRL Group, Inc. | 24,085 | |||||||||
732 | CEC Entertainment, Inc.* | 27,230 | |||||||||
11,722 | Charter Communications, Inc., Class A* | 12,543 | |||||||||
1,974 | Cheesecake Factory (The), Inc.* | 44,672 | |||||||||
1,827 | Choice Hotels International, Inc. | 63,013 | |||||||||
1,047 | Christopher & Banks Corp. | 12,407 | |||||||||
1,545 | CKE Restaurants, Inc. | 16,207 | |||||||||
2,215 | Dillard's, Inc., Class A | 45,186 | |||||||||
33,699 | DIRECTV Group (The), Inc.* | 830,343 | |||||||||
2,643 | Dollar Tree, Inc.* | 83,519 | |||||||||
2,782 | Entravision Communications Corp., Class A* | 19,446 | |||||||||
854 | Ethan Allen Interiors, Inc. | 23,459 | |||||||||
8,405 | Expedia, Inc.* | 212,310 | |||||||||
4,111 | Family Dollar Stores, Inc. | 87,975 | |||||||||
283 | Famous Dave's Of America, Inc.* | 2,550 | |||||||||
740 | Gaiam, Inc., Class A* | 13,024 | |||||||||
21,633 | Gap (The), Inc. | 402,806 | |||||||||
680 | Group 1 Automotive, Inc. | 18,142 | |||||||||
837 | Gymboree Corp.* | 36,175 | |||||||||
6,959 | Harley-Davidson, Inc. | 266,182 | |||||||||
1,780 | Harman International Industries, Inc. | 72,749 | |||||||||
1,568 | Harris Interactive, Inc.* | 3,920 | |||||||||
1,880 | Harte-Hanks, Inc. | 25,681 | |||||||||
4,197 | Hasbro, Inc. | 149,245 | |||||||||
49,738 | Home Depot (The), Inc. | 1,432,453 | |||||||||
392 | Hooker Furniture Corp. | 8,220 | |||||||||
9,206 | International Game Technology | 319,816 | |||||||||
1,753 | Jack in the Box, Inc.* | 46,893 | |||||||||
1,647 | Jackson Hewitt Tax Service, Inc. | 24,557 | |||||||||
2,548 | Jones Apparel Group, Inc. | 40,335 | |||||||||
1,716 | Journal Communications, Inc., Class A | 9,884 | |||||||||
2,759 | Lamar Advertising Co., Class A* | 109,091 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
475 | Landry's Restaurants, Inc. | $ | 7,586 | ||||||||
4,909 | Leggett & Platt, Inc. | 81,489 | |||||||||
10,112 | Liberty Global, Inc., Series A* | 357,864 | |||||||||
14,484 | Liberty Media Corp. - Entertainment, Class A* | 375,860 | |||||||||
352 | Lifetime Brands, Inc. | 2,999 | |||||||||
10,027 | Limited Brands, Inc. | 185,700 | |||||||||
12,364 | Macy's, Inc. | 312,686 | |||||||||
10,405 | Marriott International, Inc., Class A | 356,892 | |||||||||
2,300 | Marvel Entertainment, Inc.* | 65,987 | |||||||||
9,499 | McGraw-Hill (The) Cos., Inc. | 389,364 | |||||||||
673 | Media General, Inc., Class A | 9,880 | |||||||||
407 | Midas, Inc.* | 6,321 | |||||||||
543 | Monro Muffler, Inc. | 8,960 | |||||||||
6,445 | Nordstrom, Inc. | 227,251 | |||||||||
156 | NVR, Inc.* | 95,706 | |||||||||
849 | Papa John's International, Inc.* | 22,923 | |||||||||
989 | Polaris Industries, Inc. | 46,038 | |||||||||
1,406 | Pool Corp. | 30,693 | |||||||||
358 | Pre-Paid Legal Services, Inc.* | 15,659 | |||||||||
528 | RC2 Corp.* | 9,768 | |||||||||
1,522 | Ruby Tuesday, Inc. | 12,952 | |||||||||
1,128 | Scholastic Corp.* | 31,753 | |||||||||
3,895 | Sears Holdings Corp.* | 384,086 | |||||||||
1,319 | Select Comfort Corp.* | 3,983 | |||||||||
3,505 | Sherwin-Williams (The) Co. | 193,897 | |||||||||
1,763 | Sonic Corp.* | 38,768 | |||||||||
1,124 | Stage Stores, Inc. | 17,692 | |||||||||
584 | Stamps.com, Inc.* | 8,007 | |||||||||
304 | Stanley Furniture Co., Inc. | �� | 3,733 | ||||||||
5,541 | Starwood Hotels & Resorts Worldwide, Inc. | 289,296 | |||||||||
2,198 | Tempur-Pedic International, Inc. | 24,420 | |||||||||
105,252 | Time Warner, Inc. | 1,562,991 | |||||||||
729 | Tween Brands, Inc.* | 13,851 | |||||||||
18,861 | Viacom, Inc., Class B* | 725,017 | |||||||||
56,830 | Walt Disney (The) Co. | 1,842,996 | |||||||||
2,338 | Weight Watchers International, Inc. | 107,221 | |||||||||
2,572 | Wendy's International, Inc. | 74,588 | |||||||||
3,101 | Williams-Sonoma, Inc. | 81,866 | |||||||||
855 | Winnebago Industries, Inc. | 13,757 | |||||||||
5,210 | Wyndham Worldwide Corp. | 111,911 | |||||||||
1,258 | Zale Corp.* | 26,066 | |||||||||
14,257,607 | |||||||||||
Consumer Staples—5.0% | |||||||||||
4,087 | Clorox (The) Co. | 216,611 | |||||||||
6,346 | Constellation Brands, Inc., Class A* | 116,513 | |||||||||
5,693 | Estee Lauder (The) Cos., Inc., Class A | 259,658 | |||||||||
12,334 | Kimberly-Clark Corp. | 789,253 | |||||||||
45,125 | Kraft Foods, Inc., Class A | 1,427,303 | |||||||||
860 | Lancaster Colony Corp. | 32,843 | |||||||||
530 | Omega Protein Corp.* | 7,950 |
See Notes to Financial Statements.
24
Schedule of Investments (Continued)
PowerShares Buyback AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
6,475 | Pepsi Bottling Group (The), Inc. | $ | 218,272 | ||||||||
482 | USANA Health Sciences, Inc.* | 9,399 | |||||||||
3,077,802 | |||||||||||
Energy—8.6% | |||||||||||
1,429 | Cheniere Energy, Inc.* | 13,918 | |||||||||
935 | Energy Partners Ltd.* | 11,360 | |||||||||
33,178 | Exxon Mobil Corp. | 3,087,876 | |||||||||
25,674 | Halliburton Co. | 1,178,693 | |||||||||
1,032 | Harvest Natural Resources, Inc.* | 9,794 | |||||||||
765 | Hornbeck Offshore Services, Inc.* | 38,151 | |||||||||
918 | Overseas Shipholding Group, Inc. | 69,089 | |||||||||
665 | SEACOR Holdings, Inc.* | 56,598 | |||||||||
15,735 | Valero Energy Corp. | 768,655 | |||||||||
5,234,134 | |||||||||||
Financials—15.4% | |||||||||||
16,493 | Allstate (The) Corp. | 830,588 | |||||||||
646 | AMCORE Financial, Inc. | 8,036 | |||||||||
285 | American Physicians Capital, Inc. | 13,210 | |||||||||
8,991 | AON Corp. | 408,101 | |||||||||
900 | Asset Acceptance Capital Corp. | 10,845 | |||||||||
1,415 | Bank Mutual Corp. | 15,834 | |||||||||
1,655 | BankAtlantic Bancorp, Inc., Class A | 5,097 | |||||||||
2,858 | Calamos Asset Management, Inc., Class A | 51,301 | |||||||||
1,550 | Centennial Bank Holdings, Inc.* | 9,703 | |||||||||
34,114 | Charles Schwab (The) Corp. | 736,863 | |||||||||
10,896 | Chubb (The) Corp. | 577,161 | |||||||||
474 | City Holding Co. | 19,709 | |||||||||
804 | Clifton Savings Bancorp, Inc. | 8,040 | |||||||||
1,773 | Commerce Group (The), Inc. | 64,608 | |||||||||
558 | Consumer Portfolio Services, Inc.* | 1,618 | |||||||||
17,168 | Countrywide Financial Corp. | 99,231 | |||||||||
997 | Dime Community Bancshares, Inc. | 18,614 | |||||||||
3,404 | Eaton Vance Corp. | 124,586 | |||||||||
750 | Financial Federal Corp. | 17,513 | |||||||||
2,717 | First American (The) Corp. | 89,118 | |||||||||
1,100 | First Financial Bancorp | 14,432 | |||||||||
402 | FirstFed Financial Corp.* | 6,143 | |||||||||
1,775 | Flagstar Bancorp, Inc. | 10,863 | |||||||||
258 | FPIC Insurance Group, Inc.* | 12,005 | |||||||||
4,469 | Friedman Billings Ramsey Group, Inc., Class A | 11,128 | |||||||||
12,584 | Goldman Sachs Group (The), Inc. | 2,408,201 | |||||||||
798 | Greenhill & Co., Inc. | 51,910 | |||||||||
15,270 | Hudson City Bancorp, Inc. | 292,115 | |||||||||
405 | Independent Bank Corp. | 11,838 | |||||||||
477 | Infinity Property & Casualty Corp. | 18,489 | |||||||||
3,181 | Investors Bancorp, Inc.* | 46,665 | |||||||||
4,791 | Janus Capital Group, Inc. | 134,435 | |||||||||
2,759 | Knight Capital Group, Inc., Class A* | 51,621 | |||||||||
452 | LandAmerica Financial Group, Inc. | 12,972 | |||||||||
3,801 | Liberty Media Corp. Capital, Series A* | 58,421 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
15,334 | Marsh & McLennan Cos., Inc. | $ | 423,065 | ||||||||
6,949 | MBIA, Inc. | 72,270 | |||||||||
7,252 | Moody's Corp. | 268,034 | |||||||||
4,059 | Nationwide Financial Services, Inc., Class A | 203,437 | |||||||||
946 | NBT Bancorp, Inc. | 21,550 | |||||||||
1,455 | Nelnet, Inc., Class A | 18,609 | |||||||||
404 | Old Second Bancorp, Inc. | 9,910 | |||||||||
690 | PFF Bancorp, Inc. | 2,608 | |||||||||
447 | Portfolio Recovery Associates, Inc. | 19,672 | |||||||||
19,939 | Progressive (The) Corp. | 362,690 | |||||||||
182 | Provident Financial Holdings, Inc. | 2,377 | |||||||||
223 | Rome Bancorp, Inc. | 2,571 | |||||||||
2,641 | Safeco Corp. | 176,260 | |||||||||
1,585 | Selective Insurance Group | 33,792 | |||||||||
139 | Southcoast Financial Corp.* | 2,175 | |||||||||
1,442 | StanCorp Financial Group, Inc. | 73,888 | |||||||||
202 | Timberland Bancorp Inc/WA | 2,236 | |||||||||
2,670 | Torchmark Corp. | 172,856 | |||||||||
17,796 | Travelers (The) Cos., Inc. | 896,919 | |||||||||
463 | United PanAm Financial Corp.* | 1,537 | |||||||||
25,975 | Washington Mutual, Inc. | 319,233 | |||||||||
920 | Wauwatosa Holdings, Inc.* | 11,215 | |||||||||
694 | Wintrust Financial Corp. | 22,014 | |||||||||
182 | WSFS Financial Corp. | 9,247 | |||||||||
9,379,179 | |||||||||||
Health Care—14.4% | |||||||||||
275 | America Service Group, Inc.* | 1,810 | |||||||||
4,786 | AmerisourceBergen Corp. | 194,072 | |||||||||
32,012 | Amgen, Inc.* | 1,340,341 | |||||||||
4,926 | Applera Corp. - Applied Biosystems Group | 157,189 | |||||||||
505 | Aspect Medical Systems, Inc.* | 3,373 | |||||||||
8,624 | Biogen Idec, Inc.* | 523,391 | |||||||||
10,495 | Cardinal Health, Inc. | 546,475 | |||||||||
711 | Chemed Corp. | 24,245 | |||||||||
8,243 | CIGNA Corp. | 352,059 | |||||||||
7,440 | Express Scripts, Inc.* | 520,949 | |||||||||
754 | Haemonetics Corp.* | 43,151 | |||||||||
5,397 | Hlth Corp.* | 60,015 | |||||||||
409 | ICU Medical, Inc.* | 10,274 | |||||||||
776 | Integra LifeSciences Holdings Corp.* | 32,879 | |||||||||
3,263 | Laboratory Corp. of America Holdings* | 246,748 | |||||||||
544 | LCA-Vision, Inc. | 5,500 | |||||||||
2,155 | Lincare Holdings, Inc.* | 52,453 | |||||||||
15,267 | Medco Health Solutions, Inc.* | 756,327 | |||||||||
993 | Mentor Corp. | 29,065 | |||||||||
1,017 | Par Pharmaceutical Cos., Inc.* | 17,340 | |||||||||
151,623 | Pfizer, Inc. | 3,049,138 | |||||||||
657 | United Therapeutics Corp.* | 55,517 | |||||||||
15,485 | WellPoint, Inc.* | 770,378 | |||||||||
241 | Young Innovations, Inc. | 4,295 | |||||||||
8,796,984 |
See Notes to Financial Statements.
25
Schedule of Investments (Continued)
PowerShares Buyback AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Industrials—7.3% | |||||||||||
1,195 | Acuity Brands, Inc. | $ | 57,169 | ||||||||
1,477 | American Commercial Lines, Inc.* | 23,366 | |||||||||
418 | American Woodmark Corp. | 7,888 | |||||||||
176 | Amrep Corp. | 9,178 | |||||||||
774 | Bowne & Co., Inc. | 12,879 | |||||||||
319 | Cascade Corp. | 13,797 | |||||||||
1,997 | ChoicePoint, Inc.* | 96,555 | |||||||||
326 | Consolidated Graphics, Inc.* | 18,963 | |||||||||
1,023 | Corporate Executive Board Co. | 44,572 | |||||||||
324 | CRA International, Inc.* | 11,172 | |||||||||
883 | Diamond Management & Technology Consultants, Inc. | 5,430 | |||||||||
632 | Dollar Thrifty Automotive Group* | 8,336 | |||||||||
1,667 | Dun & Bradstreet (The) Corp. | 140,528 | |||||||||
349 | FreightCar America, Inc. | 13,402 | |||||||||
1,410 | GATX Corp. | 62,040 | |||||||||
1,047 | Genesee & Wyoming, Inc., Class A* | 37,357 | |||||||||
1,783 | Graco, Inc. | 73,834 | |||||||||
1,651 | Herman Miller, Inc. | 38,518 | |||||||||
1,309 | HNI Corp. | 28,497 | |||||||||
21,823 | Honeywell International, Inc. | 1,296,287 | |||||||||
547 | Houston Wire & Cable Co. | 10,234 | |||||||||
2,755 | IKON Office Solutions, Inc. | 30,167 | |||||||||
3,670 | J.B. Hunt Transport Services, Inc. | 124,670 | |||||||||
3,176 | Joy Global, Inc. | 235,818 | |||||||||
1,545 | Landstar System, Inc. | 80,278 | |||||||||
1,782 | Lennox International, Inc. | 59,055 | |||||||||
444 | MAIR Holdings, Inc.* | 1,505 | |||||||||
10,733 | Masco Corp. | 195,448 | |||||||||
435 | Nuco2, Inc.* | 12,032 | |||||||||
1,021 | Pacer International, Inc. | 18,950 | |||||||||
528 | Pinnacle Airlines Corp.* | 4,393 | |||||||||
1,049 | Republic Airways Holdings, Inc.* | 17,686 | |||||||||
4,319 | Rockwell Automation, Inc. | 234,219 | |||||||||
396 | Saia, Inc.* | 5,469 | |||||||||
21,536 | Southwest Airlines Co. | 285,137 | |||||||||
1,569 | SPX Corp. | 192,987 | |||||||||
541 | Standard Parking Corp.* | 11,594 | |||||||||
1,103 | Toro (The) Co. | 46,756 | |||||||||
1,304 | TrueBlue, Inc.* | 16,600 | |||||||||
688 | United Stationers, Inc.* | 30,334 | |||||||||
301 | USA Truck Inc* | 3,672 | |||||||||
2,324 | W.W. Grainger, Inc. | 201,514 | |||||||||
14,534 | Waste Management, Inc. | 524,678 | |||||||||
2,072 | Werner Enterprises, Inc. | 40,300 | |||||||||
1,261 | WESCO International, Inc.* | 46,922 | |||||||||
254 | Willis Lease Finance Corp.* | 3,142 | |||||||||
4,433,328 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Information Technology—19.9% | |||||||||||
1,890 | ADTRAN, Inc. | $ | 44,717 | ||||||||
10,743 | Agilent Technologies, Inc.* | 324,546 | |||||||||
670 | Agilysys, Inc. | 7,343 | |||||||||
8,881 | Altera Corp. | 188,988 | |||||||||
8,651 | Analog Devices, Inc. | 278,649 | |||||||||
433 | Anaren, Inc.* | 5,833 | |||||||||
13,065 | Atmel Corp.* | 48,602 | |||||||||
2,147 | Borland Software Corp.* | 3,800 | |||||||||
2,015 | Brooks Automation, Inc.* | 20,875 | |||||||||
390 | Catapult Communications Corp.* | 2,816 | |||||||||
8,070 | Compuware Corp.* | 60,848 | |||||||||
3,749 | Convergys Corp.* | 58,934 | |||||||||
1,028 | CSG Systems International, Inc.* | 12,439 | |||||||||
894 | Cymer, Inc.* | 23,235 | |||||||||
767 | Ditech Networks, Inc.* | 2,186 | |||||||||
1,670 | DST Systems, Inc.* | 99,933 | |||||||||
3,386 | Entegris, Inc.* | 25,530 | |||||||||
1,046 | ESS Technology* | 1,632 | |||||||||
1,439 | Fair Isaac Corp. | 35,644 | |||||||||
2,900 | Gartner, Inc.* | 66,468 | |||||||||
686 | Gevity HR, Inc. | 4,679 | |||||||||
64,453 | Hewlett-Packard Co. | 2,987,397 | |||||||||
277 | Integral Systems Inc/MD | 9,554 | |||||||||
1,366 | InterDigital, Inc.* | 27,689 | |||||||||
25,206 | International Business Machines Corp. | 3,042,365 | |||||||||
3,657 | Intersil Corp., Class A | 97,715 | |||||||||
15,409 | Juniper Networks, Inc.* | 425,597 | |||||||||
5,005 | KLA-Tencor Corp. | 218,618 | |||||||||
1,571 | Kulicke & Soffa Industries, Inc.* | 10,353 | |||||||||
5,120 | Lawson Software, Inc.* | 40,909 | |||||||||
6,503 | Linear Technology Corp. | 227,345 | |||||||||
721 | Manhattan Associates, Inc.* | 18,753 | |||||||||
545 | MAXIMUS, Inc. | 20,666 | |||||||||
1,022 | Mettler Toledo International, Inc.* | 97,356 | |||||||||
66,359 | Motorola, Inc. | 660,936 | |||||||||
7,137 | National Semiconductor Corp. | 145,523 | |||||||||
10,110 | NetApp, Inc.* | 244,662 | |||||||||
1,057 | Newport Corp.* | 12,166 | |||||||||
2,931 | Novellus Systems, Inc.* | 64,072 | |||||||||
11,639 | ON Semiconductor Corp.* | 86,943 | |||||||||
2,453 | Openwave Systems, Inc. | 5,249 | |||||||||
345 | Performance Technologies, Inc.* | 1,656 | |||||||||
578 | Pervasive Software, Inc.* | 2,746 | |||||||||
3,953 | QLogic Corp.* | 63,090 | |||||||||
4,189 | RealNetworks, Inc.* | 25,804 | |||||||||
1,670 | S1 Corp.* | 11,289 | |||||||||
838 | Selectica, Inc.* | 1,198 | |||||||||
1,809 | Semtech Corp.* | 29,378 |
See Notes to Financial Statements.
26
Schedule of Investments (Continued)
PowerShares Buyback AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
1,780 | SonicWALL, Inc.* | $ | 13,688 | ||||||||
23,331 | Sun Microsystems, Inc.* | 365,363 | |||||||||
24,910 | Symantec Corp.* | 428,950 | |||||||||
152 | Tessco Technologies, Inc.* | 2,044 | |||||||||
38,934 | Texas Instruments, Inc. | 1,135,315 | |||||||||
5,487 | TIBCO Software, Inc.* | 42,085 | |||||||||
2,234 | Varian Semiconductor Equipment Associates, Inc.* | 81,831 | |||||||||
723 | Vignette Corp.* | 8,351 | |||||||||
659 | White Electronic Designs Corp.* | 3,012 | |||||||||
8,427 | Xilinx, Inc. | 208,737 | |||||||||
12,186,102 | |||||||||||
Materials—2.4% | |||||||||||
201 | AEP Industries, Inc.* | 5,674 | |||||||||
1,277 | Eagle Materials, Inc. | 46,330 | |||||||||
2,384 | International Flavors & Fragrances, Inc. | 108,734 | |||||||||
12,589 | International Paper Co. | 329,454 | |||||||||
1,214 | Martin Marietta Materials, Inc. | 132,787 | |||||||||
454 | NewMarket Corp. | 29,478 | |||||||||
5,768 | Rohm & Haas Co. | 308,300 | |||||||||
828 | Schnitzer Steel Industries, Inc., Class A | 72,864 | |||||||||
900 | Spartech Corp. | 8,046 | |||||||||
6,218 | Weyerhaeuser Co. | 397,206 | |||||||||
2,334 | Worthington Industries, Inc. | 42,035 | |||||||||
1,480,908 | |||||||||||
Telecommunication Services—0.5% | |||||||||||
1,817 | Premiere Global Services, Inc.* | 26,383 | |||||||||
51,877 | Qwest Communications International, Inc. | 267,685 | |||||||||
294,068 | |||||||||||
Utilities—3.3% | |||||||||||
16,988 | Dominion Resources, Inc. | 737,110 | |||||||||
4,804 | DTE Energy Co. | 193,649 | |||||||||
5,661 | Entergy Corp. | 650,223 | |||||||||
6,959 | NRG Energy, Inc.* | 305,848 | |||||||||
3,062 | ONEOK, Inc. | 147,343 | |||||||||
2,034,173 | |||||||||||
Total Common Stocks (Cost $64,018,254) | 61,174,285 | ||||||||||
Money Market Fund—0.3% | |||||||||||
193,647 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $193,647) | 193,647 | |||||||||
Total Investments (Cost $64,211,901)—100.4% | 61,367,932 | ||||||||||
Liabilities in excess of other assets—(0.4%) | (236,205 | ) | |||||||||
Net Assets—100.0% | $ | 61,131,727 |
* Non-income producing security.
See Notes to Financial Statements.
27
Schedule of Investments
PowerShares Dividend AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.5% | |||||||||||
Consumer Discretionary—6.6% | |||||||||||
347 | Cato Corp. (The), Class A | $ | 5,986 | ||||||||
641 | Cedar Fair, L.P. | 15,115 | |||||||||
3,713 | D.R. Horton, Inc. | 57,514 | |||||||||
1,647 | Family Dollar Stores, Inc. | 35,246 | |||||||||
2,707 | Gannett Co., Inc. | 77,474 | |||||||||
1,949 | Genuine Parts Co. | 82,755 | |||||||||
3,836 | H&R Block, Inc. | 83,893 | |||||||||
2,788 | Harley-Davidson, Inc. | 106,641 | |||||||||
753 | Harte-Hanks, Inc. | 10,286 | |||||||||
739 | Hillenbrand, Inc. | 14,071 | |||||||||
19,926 | Home Depot (The), Inc. | 573,869 | |||||||||
688 | John Wiley & Sons, Inc., Class A | 31,682 | |||||||||
7,001 | Johnson Controls, Inc. | 246,855 | |||||||||
606 | La-Z-Boy, Inc. | 3,860 | |||||||||
1,967 | Leggett & Platt, Inc. | 32,652 | |||||||||
17,235 | Lowe's Cos., Inc. | 434,150 | |||||||||
366 | Matthews International Corp., Class A | 18,095 | |||||||||
13,578 | McDonald's Corp. | 808,976 | |||||||||
3,806 | McGraw-Hill (The) Cos., Inc. | 156,008 | |||||||||
270 | Media General, Inc., Class A | 3,964 | |||||||||
546 | Meredith Corp. | 17,696 | |||||||||
1,695 | New York Times (The) Co., Class A | 33,053 | |||||||||
2,582 | Nordstrom, Inc. | 91,041 | |||||||||
396 | Polaris Industries, Inc. | 18,434 | |||||||||
1,571 | Ross Stores, Inc. | 52,613 | |||||||||
1,404 | Sherwin-Williams (The) Co. | 77,669 | |||||||||
924 | Stanley Works (The) | 44,574 | |||||||||
655 | Talbots (The), Inc. | 5,260 | |||||||||
9,586 | Target Corp. | 509,304 | |||||||||
5,046 | TJX Cos., Inc. | 162,582 | |||||||||
1,293 | VF Corp. | 96,173 | |||||||||
593 | Wolverine World Wide, Inc. | 17,043 | |||||||||
3,924,534 | |||||||||||
Consumer Staples—21.5% | |||||||||||
24,756 | Altria Group, Inc. | 495,120 | |||||||||
8,407 | Anheuser-Busch Cos., Inc. | 413,624 | |||||||||
7,588 | Archer-Daniels-Midland Co. | 334,327 | |||||||||
5,109 | Avon Products, Inc. | 199,353 | |||||||||
1,421 | Brown-Forman Corp., Class B | 96,656 | |||||||||
783 | Church & Dwight Co., Inc. | 44,490 | |||||||||
1,637 | Clorox (The) Co. | 86,761 | |||||||||
27,387 | Coca-Cola (The) Co. | 1,612,273 | |||||||||
5,995 | Colgate-Palmolive Co. | 423,847 | |||||||||
2,677 | Hershey (The) Co. | 100,066 | |||||||||
1,599 | Hormel Foods Corp. | 63,017 | |||||||||
4,941 | Kimberly-Clark Corp. | 316,175 | |||||||||
345 | Lancaster Colony Corp. | 13,176 | |||||||||
1,511 | McCormick & Co., Inc. | 57,101 | |||||||||
18,700 | PepsiCo, Inc. | 1,281,511 | |||||||||
23,549 | Philip Morris International, Inc.* | 1,201,705 | |||||||||
36,285 | Procter & Gamble (The) Co. | 2,432,909 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
2,505 | SUPERVALU, Inc. | $ | 82,916 | ||||||||
7,116 | Sysco Corp. | 217,536 | |||||||||
634 | Tootsie Roll Industries, Inc. | 15,425 | |||||||||
321 | Universal Corp. | 20,605 | |||||||||
11,678 | Walgreen Co. | 406,978 | |||||||||
46,573 | Wal-Mart Stores, Inc. | 2,700,302 | |||||||||
3,230 | Wm. Wrigley Jr. Co. | 245,997 | |||||||||
12,861,870 | |||||||||||
Energy—9.4% | |||||||||||
539 | Buckeye Partners LP | 26,589 | |||||||||
24,485 | Chevron Corp. | 2,354,233 | |||||||||
31,741 | Exxon Mobil Corp. | 2,954,134 | |||||||||
1,222 | Helmerich & Payne, Inc. | 65,683 | |||||||||
601 | Holly Corp. | 24,929 | |||||||||
3,004 | Kinder Morgan Energy Partners, L.P. | 175,854 | |||||||||
1,117 | TEPPCO Partners, L.P. | 39,196 | |||||||||
5,640,618 | |||||||||||
Financials—22.9% | |||||||||||
284 | 1 | st Source Corp. | 5,629 | ||||||||
5,598 | AFLAC, Inc. | 373,219 | |||||||||
378 | Alexandria Real Estate Equities, Inc. | 39,701 | |||||||||
6,608 | Allstate (The) Corp. | 332,779 | |||||||||
3,382 | AMBAC Financial Group, Inc. | 15,659 | |||||||||
2,403 | American Capital Strategies Ltd. | 76,295 | |||||||||
29,739 | American International Group, Inc. | 1,373,942 | |||||||||
252 | Anchor BanCorp Wisconsin, Inc. | 3,828 | |||||||||
1,090 | Arthur J. Gallagher & Co. | 26,781 | |||||||||
1,502 | Associated Banc-Corp | 42,462 | |||||||||
1,131 | Astoria Financial Corp. | 26,805 | |||||||||
179 | BancFirst Corp. | 7,828 | |||||||||
971 | BancorpSouth, Inc. | 23,333 | |||||||||
52,500 | Bank of America Corp. | 1,970,850 | |||||||||
565 | Bank of Hawaii Corp. | 30,979 | |||||||||
198 | Bank of the Ozarks, Inc. | 4,940 | |||||||||
663 | BankAtlantic Bancorp, Inc., Class A | 2,042 | |||||||||
189 | Banner Corp. | 4,082 | |||||||||
6,446 | BB&T Corp. | 221,033 | |||||||||
1,659 | Brown & Brown, Inc. | 31,853 | |||||||||
202 | Capital City Bank Group, Inc. | 5,303 | |||||||||
782 | CBL & Associates Properties, Inc. | 19,151 | |||||||||
281 | Chemical Financial Corp. | 6,823 | �� | ||||||||
4,365 | Chubb (The) Corp. | 231,214 | |||||||||
1,951 | Cincinnati Financial Corp. | 70,041 | |||||||||
61,897 | Citigroup, Inc. | 1,564,137 | |||||||||
564 | City National Corp. | 27,365 | |||||||||
2,312 | Colonial BancGroup (The), Inc. | 18,820 | |||||||||
1,774 | Comerica, Inc. | 61,611 | |||||||||
847 | Commerce Bancshares, Inc. | 36,845 | |||||||||
710 | Commerce Group (The), Inc. | 25,872 | |||||||||
352 | Community Bank System, Inc. | 8,972 | |||||||||
177 | Community Trust Bancorp, Inc. | 5,321 |
See Notes to Financial Statements.
28
Schedule of Investments (Continued)
PowerShares Dividend AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
559 | Corporate Office Properties Trust SBI MD | $ | 20,851 | ||||||||
649 | Corus Bankshares, Inc. | 4,757 | |||||||||
693 | Cullen/Frost Bankers, Inc. | 38,683 | |||||||||
985 | CVB Financial Corp. | 11,308 | |||||||||
1,408 | Developers Diversified Realty Corp. | 60,474 | |||||||||
1,725 | Duke Realty Corp. | 42,125 | |||||||||
281 | EastGroup Properties, Inc. | 13,407 | |||||||||
1,364 | Eaton Vance Corp. | 49,922 | |||||||||
622 | Erie Indemnity Co., Class A | 33,227 | |||||||||
301 | Essex Property Trust, Inc. | 35,819 | |||||||||
715 | F.N.B. Corp. | 11,054 | |||||||||
693 | Federal Realty Investment Trust | 56,930 | |||||||||
6,274 | Fifth Third Bancorp | 134,452 | |||||||||
170 | First BanCorp | 3,199 | |||||||||
423 | First Busey Corp. | 8,388 | |||||||||
413 | First Charter Corp. | 12,547 | |||||||||
130 | First Community Bancshares, Inc. | 4,345 | |||||||||
245 | First Financial Bankshares, Inc. | 11,023 | |||||||||
155 | First Financial Corp. | 4,929 | |||||||||
138 | First Financial Holdings, Inc. | 3,313 | |||||||||
573 | First Midwest Bancorp, Inc. | 14,629 | |||||||||
237 | First State Bancorp | 2,204 | |||||||||
949 | FirstMerit Corp. | 19,473 | |||||||||
252 | Flushing Financial Corp. | 4,919 | |||||||||
1,217 | Forest City Enterprises, Inc., Class A | 44,956 | |||||||||
2,809 | Franklin Resources, Inc. | 267,276 | |||||||||
2,048 | Fulton Financial Corp. | 25,539 | |||||||||
2,884 | General Growth Properties, Inc. | 118,129 | |||||||||
636 | Glacier Bancorp, Inc. | 13,089 | |||||||||
352 | Harleysville Group, Inc. | 12,830 | |||||||||
370 | Harleysville National Corp. | 5,350 | |||||||||
3,709 | Hartford Financial Services Group (The), Inc. | 264,340 | |||||||||
1,359 | HCC Insurance Holdings, Inc. | 33,540 | |||||||||
2,764 | HCP, Inc. | 98,675 | |||||||||
192 | Heartland Financial USA, Inc. | 4,320 | |||||||||
431 | Hilb Rogal & Hobbs Co. | 12,469 | |||||||||
385 | Home Properties, Inc. | 20,239 | |||||||||
140 | Horizon Financial Corp. | 1,719 | |||||||||
152 | IBERIABANK Corp. | 7,326 | |||||||||
270 | Independent Bank Corp. | 2,155 | |||||||||
349 | Irwin Financial Corp. | 2,038 | |||||||||
4,717 | Keycorp | 113,821 | |||||||||
2,984 | Kimco Realty Corp. | 119,091 | |||||||||
1,590 | Legg Mason, Inc. | 95,845 | |||||||||
6,528 | Lehman Brothers Holdings, Inc. | 288,799 | |||||||||
723 | Lexington Realty Trust | 10,411 | |||||||||
1,088 | Liberty Property Trust | 38,113 | |||||||||
3,119 | Lincoln National Corp. | 167,677 | |||||||||
1,297 | M&T Bank Corp. | 120,919 | |||||||||
853 | Macerich (The) Co. | 62,380 | |||||||||
219 | Mainsource Financial Group, Inc. | 3,243 | |||||||||
3,053 | Marshall & Ilsley Corp. | 76,264 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
2,784 | MBIA, Inc. | $ | 28,954 | ||||||||
645 | Mercury General Corp. | 32,179 | |||||||||
7,476 | National City Corp. | 47,099 | |||||||||
936 | National Penn Bancshares, Inc. | 15,622 | |||||||||
843 | National Retail Properties, Inc. | 19,313 | |||||||||
559 | Nationwide Financial Services, Inc., Class A | 28,017 | |||||||||
2,595 | Northern Trust Corp. | 192,315 | |||||||||
783 | Old National Bancorp | 13,397 | |||||||||
2,717 | Old Republic International Corp. | 38,989 | |||||||||
162 | Old Second Bancorp, Inc. | 3,974 | |||||||||
165 | Park National Corp. | 12,542 | |||||||||
122 | Peoples Bancorp, Inc. | 2,961 | |||||||||
3,044 | ProLogis | 190,585 | |||||||||
828 | Protective Life Corp. | 35,289 | |||||||||
374 | Provident Bankshares Corp. | 4,791 | |||||||||
1,194 | Realty Income Corp. | 31,414 | |||||||||
820 | Regency Centers Corp. | 58,687 | |||||||||
247 | Renasant Corp. | 5,723 | |||||||||
258 | RLI Corp. | 12,384 | |||||||||
158 | Royal Bancshares of Pennsylvania, Class A | 1,714 | |||||||||
290 | S&T Bancorp, Inc. | 9,880 | |||||||||
158 | S.Y. Bancorp, Inc. | 3,892 | |||||||||
193 | Sandy Spring Bancorp, Inc. | 4,922 | |||||||||
225 | Seacoast Banking Corp. of Florida | 2,365 | |||||||||
276 | Security Bank Corp. | 2,120 | |||||||||
2,274 | SEI Investments Co. | 52,916 | |||||||||
164 | Simmons First National Corp., Class A | 5,250 | |||||||||
856 | South Financial Group (The), Inc. | 5,170 | |||||||||
171 | Southwest Bancorp, Inc. | 3,010 | |||||||||
257 | Sovran Self Storage, Inc. | 11,488 | |||||||||
472 | State Auto Financial Corp. | 13,004 | |||||||||
4,603 | State Street Corp. | 332,060 | |||||||||
862 | Sterling Bancshares, Inc. | 8,956 | |||||||||
113 | Suffolk Bancorp | 3,659 | |||||||||
4,125 | SunTrust Banks, Inc. | 229,969 | |||||||||
1,014 | Susquehanna Bancshares, Inc. | 20,168 | |||||||||
3,892 | Synovus Financial Corp. | 46,081 | |||||||||
3,062 | T. Rowe Price Group, Inc. | 179,311 | |||||||||
372 | Tanger Factory Outlet Centers, Inc. | 15,006 | |||||||||
620 | Taubman Centers, Inc. | 35,135 | |||||||||
1,489 | TCF Financial Corp. | 25,909 | |||||||||
114 | Tompkins Financial Corp. | 5,514 | |||||||||
781 | Transatlantic Holdings, Inc. | 50,648 | |||||||||
676 | Trustmark Corp. | 14,723 | |||||||||
20,491 | U.S. Bancorp | 694,440 | |||||||||
1,572 | UDR, Inc. | 39,740 | |||||||||
483 | UMB Financial Corp. | 23,976 | |||||||||
510 | United Bankshares, Inc. | 14,836 | |||||||||
140 | Universal Health Realty Income Trust | 4,696 | |||||||||
151 | Univest Corp. of Pennsylvania | 3,869 | |||||||||
1,485 | Valley National Bancorp | 28,497 | |||||||||
1,811 | Vornado Realty Trust | 168,586 |
See Notes to Financial Statements.
29
Schedule of Investments (Continued)
PowerShares Dividend AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
1,035 | Washington Federal, Inc. | $ | 24,643 | ||||||||
14,629 | Washington Mutual, Inc. | 179,790 | |||||||||
550 | Washington Real Estate Investment Trust | 19,542 | |||||||||
159 | Washington Trust Bancorp, Inc. | 3,845 | |||||||||
619 | Webster Financial Corp. | 16,125 | |||||||||
989 | Weingarten Realty Investors | 36,484 | |||||||||
38,870 | Wells Fargo & Co. | 1,156,383 | |||||||||
313 | WesBanco, Inc. | 6,733 | |||||||||
84 | Wesco Financial Corp. | 36,376 | |||||||||
184 | West Coast Bancorp | 2,375 | |||||||||
339 | Westamerica Bancorp | 19,811 | |||||||||
766 | Whitney Holding Corp. | 17,932 | |||||||||
798 | Wilmington Trust Corp. | 26,238 | |||||||||
13,710,068 | |||||||||||
Health Care—12.0% | |||||||||||
18,225 | Abbott Laboratories | 961,369 | |||||||||
740 | Beckman Coulter, Inc. | 50,542 | |||||||||
2,877 | Becton, Dickinson & Co. | 257,204 | |||||||||
4,204 | Cardinal Health, Inc. | 218,902 | |||||||||
1,187 | C.R. Bard, Inc. | 111,780 | |||||||||
1,780 | DENTSPLY International, Inc. | 69,189 | |||||||||
13,405 | Eli Lilly & Co. | 645,317 | |||||||||
734 | Hill-Rom Holdings, Inc. | 18,445 | |||||||||
33,397 | Johnson & Johnson | 2,240,604 | |||||||||
13,241 | Medtronic, Inc. | 644,572 | |||||||||
473 | Meridian Bioscience, Inc. | 12,738 | |||||||||
483 | Owens & Minor, Inc. | 21,890 | |||||||||
79,714 | Pfizer, Inc. | 1,603,048 | |||||||||
4,848 | Stryker Corp. | 314,296 | |||||||||
379 | West Pharmaceutical Services, Inc. | 17,779 | |||||||||
7,187,675 | |||||||||||
Industrials—13.1% | |||||||||||
8,304 | 3M Co. | 638,579 | |||||||||
354 | A.O. Smith Corp. | 10,953 | |||||||||
592 | ABM Industries, Inc. | 12,396 | |||||||||
1,163 | Avery Dennison Corp. | 56,045 | |||||||||
172 | Badger Meter, Inc. | 8,956 | |||||||||
640 | Brady Corp., Class A | 21,728 | |||||||||
2,012 | C.H. Robinson Worldwide, Inc. | 126,112 | |||||||||
709 | Carlisle Cos., Inc. | 20,476 | |||||||||
7,357 | Caterpillar, Inc. | 602,391 | |||||||||
1,812 | Cintas Corp. | 53,653 | |||||||||
595 | Clarcor, Inc. | 24,966 | |||||||||
147 | Courier Corp. | 3,460 | |||||||||
3,754 | Danaher Corp. | 292,887 | |||||||||
923 | Donaldson Co., Inc. | 40,187 | |||||||||
2,233 | Dover Corp. | 110,467 | |||||||||
9,282 | Emerson Electric Co. | 485,077 | |||||||||
2,512 | Expeditors International of Washington, Inc. | 117,034 | |||||||||
272 | Franklin Electric Co., Inc. | 10,532 | |||||||||
4,694 | General Dynamics Corp. | 424,431 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
88,468 | General Electric Co. | $ | 2,892,905 | ||||||||
167 | Gorman-Rupp (The) Co. | 5,850 | |||||||||
997 | Harsco Corp. | 59,152 | |||||||||
524 | HNI Corp. | 11,407 | |||||||||
6,212 | Illinois Tool Works, Inc. | 324,825 | |||||||||
254 | LSI Industries, Inc. | 2,784 | |||||||||
4,300 | Masco Corp. | 78,303 | |||||||||
279 | McGrath Rentcorp | 7,207 | |||||||||
421 | Mine Safety Appliances Co. | 15,649 | |||||||||
98 | NACCO Industries, Inc., Class A | 8,810 | |||||||||
397 | Nordson Corp. | 23,435 | |||||||||
1,987 | Parker Hannifin Corp. | 158,662 | |||||||||
1,168 | Pentair, Inc. | 43,017 | |||||||||
2,489 | Pitney Bowes, Inc. | 89,878 | |||||||||
213 | Raven Industries, Inc. | 6,526 | |||||||||
1,053 | Roper Industries, Inc. | 65,412 | |||||||||
461 | Teleflex, Inc. | 25,396 | |||||||||
218 | Tennant Co. | 7,440 | |||||||||
11,474 | United Technologies Corp. | 831,522 | |||||||||
223 | Universal Forest Products, Inc. | 7,740 | |||||||||
931 | W.W. Grainger, Inc. | 80,727 | |||||||||
7,806,977 | |||||||||||
Information Technology—4.4% | |||||||||||
6,163 | Automatic Data Processing, Inc. | 272,405 | |||||||||
776 | Diebold, Inc. | 30,419 | |||||||||
16,322 | International Business Machines Corp. | 1,970,065 | |||||||||
1,029 | Jack Henry & Associates, Inc. | 27,042 | |||||||||
2,605 | Linear Technology Corp. | 91,071 | |||||||||
4,249 | Paychex, Inc. | 154,536 | |||||||||
2,344 | Total System Services, Inc. | 55,787 | |||||||||
2,601,325 | |||||||||||
Materials—2.8% | |||||||||||
2,484 | Air Products & Chemicals, Inc. | 244,500 | |||||||||
1,078 | Albemarle Corp. | 40,328 | |||||||||
802 | AptarGroup, Inc. | 35,408 | |||||||||
1,175 | Bemis Co., Inc. | 30,903 | |||||||||
2,915 | Ecolab, Inc. | 133,973 | |||||||||
623 | H.B. Fuller Co. | 14,379 | |||||||||
486 | Martin Marietta Materials, Inc. | 53,159 | |||||||||
415 | Myers Industries, Inc. | 5,221 | |||||||||
3,400 | Nucor Corp. | 256,700 | |||||||||
1,935 | PPG Industries, Inc. | 118,751 | |||||||||
3,692 | Praxair, Inc. | 337,117 | |||||||||
2,311 | Rohm & Haas Co. | 123,523 | |||||||||
1,438 | RPM International, Inc. | 32,067 | |||||||||
1,519 | Sigma-Aldrich Corp. | 86,613 | |||||||||
1,173 | Sonoco Products Co. | 38,650 | |||||||||
117 | Stepan Co. | 4,603 | |||||||||
1,181 | Valspar (The) Corp. | 25,958 | |||||||||
1,278 | Vulcan Materials Co. | 87,952 | |||||||||
1,669,805 |
See Notes to Financial Statements.
30
Schedule of Investments (Continued)
PowerShares Dividend AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Telecommunication Services—4.7% | |||||||||||
71,163 | AT&T, Inc. | $ | 2,754,720 | ||||||||
1,257 | CenturyTel, Inc. | 40,790 | |||||||||
277 | Shenandoah Telecom Co. | 3,756 | |||||||||
2,799,266 | |||||||||||
Utilities—2.1% | |||||||||||
203 | American States Water Co. | 7,109 | |||||||||
1,575 | Aqua America, Inc. | 29,027 | |||||||||
1,061 | Atmos Energy Corp. | 29,368 | |||||||||
453 | Black Hills Corp. | 17,672 | |||||||||
244 | California Water Service Group | 9,443 | |||||||||
3,214 | Consolidated Edison, Inc. | 133,703 | |||||||||
845 | Energen Corp. | 57,663 | |||||||||
1,866 | Energy East Corp. | 42,545 | |||||||||
4,812 | FPL Group, Inc. | 318,988 | |||||||||
901 | Integrys Energy Group, Inc. | 43,149 | |||||||||
2,155 | MDU Resources Group, Inc. | 62,215 | |||||||||
259 | MGE Energy, Inc. | 9,011 | |||||||||
985 | National Fuel Gas Co. | 50,412 | |||||||||
493 | New Jersey Resources Corp. | 15,702 | |||||||||
311 | Northwest Natural Gas Co. | 13,955 | |||||||||
352 | Otter Tail Corp. | 13,052 | |||||||||
866 | Piedmont Natural Gas Co., Inc. | 22,767 | |||||||||
1,185 | Pinnacle West Capital Corp. | 40,219 | |||||||||
3,067 | Progress Energy, Inc. | 128,783 | |||||||||
2,042 | Questar Corp. | 126,665 | |||||||||
217 | SJW Corp. | 6,525 | |||||||||
288 | Southwest Water Co. | 3,208 | |||||||||
1,259 | UGI Corp. | 32,734 | |||||||||
900 | Vectren Corp. | 25,452 | |||||||||
583 | WGL Holdings, Inc. | 19,122 | |||||||||
1,258,489 | |||||||||||
Total Common Stocks (Cost $61,556,131) | 59,460,627 | ||||||||||
Money Market Fund—0.4% | |||||||||||
203,766 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $203,766) | 203,766 | |||||||||
Total Investments (Cost $61,759,897)—99.9% | 59,664,393 | ||||||||||
Other assets less liabilities—0.1% | 86,924 | ||||||||||
Net Assets—100.0% | $ | 59,751,317 |
* Non-income producing security.
See Notes to Financial Statements.
31
Schedule of Investments
PowerShares Financial Preferred Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Preferred Stocks—100.3% | |||||||||||
Banks—45.8% | |||||||||||
253,855 | Bank of America Corp., 7.25%, Series J | $ | 6,394,607 | ||||||||
185,619 | Bank of America Corp., 6.20%, Series D | 4,109,605 | |||||||||
406,412 | Barclays Bank PLC, 7.75% (United Kingdom) | 10,221,262 | |||||||||
464,147 | HSBC Holdings PLC, 6.20%, Series A (United Kingdom) | 10,443,308 | |||||||||
176,507 | HSBC USA, Inc., 6.50%, Series H (United Kingdom) | 4,066,721 | |||||||||
658,437 | Royal Bank of Scotland Group PLC, 7.25%, Series T (United Kingdom) | 15,980,265 | |||||||||
184,257 | Royal Bank of Scotland Group PLC, 6.25%, Series P (United Kingdom) | 3,961,526 | |||||||||
329,989 | Royal Bank of Scotland Group PLC, 6.35%, Series N (United Kingdom) | 7,345,555 | |||||||||
329,540 | Royal Bank of Scotland Group PLC, 6.40%, Series M (United Kingdom) | 7,266,357 | |||||||||
339,102 | Royal Bank of Scotland Group PLC, 6.60%, Series S (United Kingdom) | 7,589,103 | |||||||||
254,304 | Royal Bank of Scotland Group PLC, 6.75%, Series Q (United Kingdom) | 5,915,111 | |||||||||
205,443 | Santander Finance Preferred SA Unipersonal , 6.80%, (Spain) | 4,593,705 | |||||||||
245,992 | Santander Finance Preferred SA Unipersonal , 6.50% (Spain) | 5,141,233 | |||||||||
202,043 | U.S. Bancorp, 7.88%, Series D * | 5,289,486 | |||||||||
408,397 | Wachovia Corp., 8.0%, Series J | 10,275,269 | |||||||||
108,593,113 | |||||||||||
Diversified Financial Services—14.4% | |||||||||||
174,507 | CIT Group, Inc., 6.35%, Series A | 2,409,942 | |||||||||
206,650 | Credit Suisse Guernsey, 7.9% (Switzerland)* | 5,232,378 | |||||||||
441,823 | Goldman Sachs Group, Inc., 6.20%, Series B | 10,378,422 | |||||||||
305,998 | HSBC Finance Corp., 6.36% (United Kingdom) | 6,780,916 | |||||||||
122,445 | Lehman Brothers Holdings, 6.50% | 2,617,874 | |||||||||
331,295 | Merrill Lynch & Co., Inc., 6.38%, Series 3 | 6,758,418 | |||||||||
34,177,950 | |||||||||||
Insurance—40.1% | |||||||||||
340,602 | ACE Ltd., 7.80%, Series C | 8,412,869 | |||||||||
430,340 | Aegon N.V., 7.25% (Netherlands) | 10,242,092 | |||||||||
309,274 | Aegon N.V., 6.38% (Netherlands) | 6,556,609 | |||||||||
206,128 | Aegon N.V., 6.50% (Netherlands) | 4,407,017 | |||||||||
224,833 | Aegon N.V. 6.88% (Netherlands) | 5,132,937 | |||||||||
102,495 | Axis Capital Holdings Ltd., 7.25%, Series A | 2,442,456 | |||||||||
608,930 | ING Groep N.V., 7.38% (Netherlands) | 15,150,177 | |||||||||
285,140 | ING Groep N.V., 6.13% (Netherlands) | 5,973,683 | |||||||||
203,743 | ING Groep N.V., 6.20% (Netherlands) | 4,523,095 | |||||||||
426,757 | ING Groep N.V., 6.38% (Netherlands) | 9,461,203 | |||||||||
461,487 | MetLife, Inc., 6.50%, Series B | 10,628,046 | |||||||||
117,741 | PartnerRe Ltd., 6.75%, Series C | 2,596,189 |
Number of Shares | Value | ||||||||||
Preferred Stocks (Continued) | |||||||||||
122,045 | Prudential PLC, 6.50% (United Kingdom) | $ | 2,697,195 | ||||||||
101,320 | Prudential PLC, 6.75% (United Kingdom) | 2,276,660 | |||||||||
101,320 | RenaissanceRe Holdings Ltd., 6.08%, Series C | 1,959,529 | |||||||||
123,006 | RenaissanceRe Holdings Ltd., 6.60%, Series D | 2,626,178 | |||||||||
95,085,935 | |||||||||||
Total Preferred Stocks (Cost $245,748,154) | 237,856,998 | ||||||||||
Money Market Fund—0.2% | |||||||||||
433,450 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $433,450) | 433,450 | |||||||||
Total Investments (Cost $246,181,604)—100.5% | 238,290,448 | ||||||||||
Liabilities in excess of other assets—(0.5%) | (1,164,385 | ) | |||||||||
Net Assets—100.0% | $ | 237,126,063 |
* Non-income producing security.
The Fund has holdings greater than 10% of net assets in the following countries:
United Kingdom | 35.7 | % | |||||
Netherlands | 25.9 |
See Notes to Financial Statements.
32
Schedule of Investments
PowerShares High Growth Rate Dividend AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests—100.0% | |||||||||||
Advertising—0.1% | |||||||||||
1,275 | Harte-Hanks, Inc. | $ | 17,417 | ||||||||
Aerospace/Defense—4.0% | |||||||||||
14,801 | United Technologies Corp. | 1,072,628 | |||||||||
Apparel—0.1% | |||||||||||
1,005 | Wolverine World Wide, Inc. | 28,884 | |||||||||
Banks—17.0% | |||||||||||
304 | BancFirst Corp. | 13,294 | |||||||||
28,315 | Bank of America Corp. | 1,062,946 | |||||||||
336 | Bank of the Ozarks, Inc. | 8,383 | |||||||||
320 | Banner Corp. | 6,912 | |||||||||
956 | City National Corp. | 46,385 | |||||||||
1,098 | Corus Bankshares, Inc. | 8,048 | |||||||||
1,667 | CVB Financial Corp. | 19,137 | |||||||||
10,621 | Fifth Third Bancorp | 227,608 | |||||||||
401 | First State Bancorp | 3,729 | |||||||||
1,076 | Glacier Bancorp, Inc. | 22,144 | |||||||||
257 | IBERIABANK Corp. | 12,387 | |||||||||
457 | Independent Bank Corp. | 3,647 | |||||||||
2,196 | M&T Bank Corp. | 204,733 | |||||||||
274 | Old Second Bancorp, Inc. | 6,721 | |||||||||
633 | Provident Bankshares Corp. | 8,109 | |||||||||
268 | S.Y. Bancorp, Inc. | 6,601 | |||||||||
468 | Security Bank Corp/GA | 3,594 | |||||||||
290 | Southwest Bancorp, Inc. | 5,104 | |||||||||
7,793 | State Street Corp. | 562,187 | |||||||||
6,589 | Synovus Financial Corp. | 78,014 | |||||||||
2,521 | TCF Financial Corp. | 43,865 | |||||||||
31,200 | U.S. Bancorp | 1,057,368 | |||||||||
256 | Univest Corp. of Pennsylvania | 6,559 | |||||||||
35,632 | Wells Fargo & Co. | 1,060,053 | |||||||||
311 | West Coast Bancorp | 4,015 | |||||||||
574 | Westamerica Bancorp | 33,545 | |||||||||
4,515,088 | |||||||||||
Building Materials—0.0% | |||||||||||
430 | LSI Industries, Inc. | 4,713 | |||||||||
Chemicals—2.7% | |||||||||||
6,250 | Praxair, Inc. | 570,688 | |||||||||
2,571 | Sigma-Aldrich Corp. | 146,598 | |||||||||
717,286 | |||||||||||
Commercial Services—3.1% | |||||||||||
10,434 | Automatic Data Processing, Inc. | 461,183 | |||||||||
472 | Mcgrath Rentcorp | 12,192 | |||||||||
7,193 | Paychex, Inc. | 261,609 | |||||||||
3,969 | Total System Services, Inc. | 94,462 | |||||||||
829,446 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Computers—4.2% | |||||||||||
8,884 | International Business Machines Corp. | $ | 1,072,299 | ||||||||
1,742 | Jack Henry & Associates, Inc. | 45,780 | |||||||||
1,118,079 | |||||||||||
Distribution/Wholesale—0.1% | |||||||||||
817 | Owens & Minor, Inc. | 37,026 | |||||||||
Diversified Financial Services—9.4% | |||||||||||
40,324 | Citigroup, Inc. | 1,018,988 | |||||||||
2,308 | Eaton Vance Corp. | 84,473 | |||||||||
4,756 | Franklin Resources, Inc. | 452,533 | |||||||||
2,691 | Legg Mason, Inc. | 162,213 | |||||||||
11,051 | Lehman Brothers Holdings, Inc. | 488,896 | |||||||||
5,184 | T. Rowe Price Group, Inc. | 303,575 | |||||||||
2,510,678 | |||||||||||
Environmental Control—0.1% | |||||||||||
712 | Mine Safety Appliances Co. | 26,465 | |||||||||
Food—1.4% | |||||||||||
12,047 | Sysco Corp. | 368,277 | |||||||||
Healthcare-Products—11.7% | |||||||||||
4,871 | Becton, Dickinson & Co. | 435,467 | |||||||||
16,059 | Johnson & Johnson | 1,077,399 | |||||||||
21,475 | Medtronic, Inc. | 1,045,403 | |||||||||
800 | Meridian Bioscience, Inc. | 21,544 | |||||||||
8,207 | Stryker Corp. | 532,060 | |||||||||
3,111,873 | |||||||||||
Home Builders—0.4% | |||||||||||
6,286 | D.R. Horton, Inc. | 97,370 | |||||||||
Insurance—10.4% | |||||||||||
9,477 | AFLAC, Inc. | 631,832 | |||||||||
11,186 | Allstate (The) Corp. | 563,327 | |||||||||
22,982 | American International Group, Inc. | 1,061,767 | |||||||||
1,845 | Arthur J. Gallagher & Co. | 45,332 | |||||||||
2,809 | Brown & Brown, Inc. | 53,933 | |||||||||
1,054 | Erie Indemnity Co., Class A | 56,305 | |||||||||
2,301 | HCC Insurance Holdings, Inc. | 56,789 | |||||||||
1,092 | Mercury General Corp. | 54,480 | |||||||||
2,753 | Nationwide Financial Services, Inc., Class A | 137,980 | |||||||||
4,600 | Old Republic International Corp. | 66,010 | |||||||||
436 | RLI Corp. | 20,928 | |||||||||
799 | State Auto Financial Corp. | 22,012 | |||||||||
2,770,695 | |||||||||||
Investment Companies—0.5% | |||||||||||
4,068 | American Capital Strategies Ltd. | 129,159 | |||||||||
Iron/Steel—1.6% | |||||||||||
5,757 | Nucor Corp. | 434,654 |
See Notes to Financial Statements.
33
Schedule of Investments (Continued)
PowerShares High Growth Rate Dividend AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Leisure Time—0.8% | |||||||||||
4,720 | Harley-Davidson, Inc. | $ | 180,540 | ||||||||
671 | Polaris Industries, Inc. | 31,235 | |||||||||
211,775 | |||||||||||
Media—0.2% | |||||||||||
248 | Courier Corp. | 5,838 | |||||||||
1,165 | John Wiley & Sons, Inc., Class A | 53,648 | |||||||||
59,486 | |||||||||||
Miscellaneous Manufacturing—4.5% | |||||||||||
1,358 | AptarGroup, Inc. | 59,956 | |||||||||
6,356 | Danaher Corp. | 495,895 | |||||||||
1,562 | Donaldson Co., Inc. | 68,009 | |||||||||
10,517 | Illinois Tool Works, Inc. | 549,934 | |||||||||
361 | Raven Industries, Inc. | 11,061 | |||||||||
1,184,855 | |||||||||||
Oil & Gas—0.2% | |||||||||||
1,018 | Holly Corp. | 42,227 | |||||||||
Pharmaceuticals—5.4% | |||||||||||
7,118 | Cardinal Health, Inc. | 370,634 | |||||||||
53,439 | Pfizer, Inc. | 1,074,659 | |||||||||
1,445,293 | |||||||||||
Pipelines—1.1% | |||||||||||
5,086 | Kinder Morgan Energy Partners, L.P. | 297,734 | |||||||||
Real Estate—0.3% | |||||||||||
2,060 | Forest City Enterprises, Inc., Class A | 76,096 | |||||||||
REIT—0.3% | |||||||||||
639 | Alexandria Real Estate Equities, Inc. | 67,114 | |||||||||
Retail—16.6% | |||||||||||
587 | Cato Corp. (The), Class A | 10,126 | |||||||||
33,733 | Home Depot (The), Inc. | 971,510 | |||||||||
29,178 | Lowe's Cos., Inc. | 734,994 | |||||||||
18,142 | McDonald's Corp. | 1,080,900 | |||||||||
4,371 | Nordstrom, Inc. | 154,121 | |||||||||
2,660 | Ross Stores, Inc. | 89,083 | |||||||||
8,542 | TJX (The) Cos., Inc. | 275,223 | |||||||||
18,851 | Wal-Mart Stores, Inc. | 1,092,982 | |||||||||
4,408,939 | |||||||||||
Savings & Loans—1.0% | |||||||||||
426 | Anchor BanCorp Wisconsin, Inc. | 6,471 | |||||||||
1,914 | Astoria Financial Corp. | 45,362 | |||||||||
426 | Flushing Financial Corp. | 8,316 | |||||||||
17,617 | Washington Mutual, Inc. | 216,512 | |||||||||
276,661 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Semiconductors—0.6% | |||||||||||
4,410 | Linear Technology Corp. | $ | 154,174 | ||||||||
Software—0.3% | |||||||||||
3,850 | SEI Investments Co. | 89,590 | |||||||||
Telecommunications—0.0% | |||||||||||
470 | Shenandoah Telecom Co. | 6,373 | |||||||||
Textiles—0.3% | |||||||||||
3,068 | Cintas Corp. | 90,843 | |||||||||
Transportation—1.6% | |||||||||||
3,407 | C.H. Robinson Worldwide, Inc. | 213,551 | |||||||||
4,253 | Expeditors International of Washington, Inc. | 198,147 | |||||||||
411,698 | |||||||||||
Total Common Stocks (Cost $28,800,625) | 26,612,596 | ||||||||||
Money Market Fund—0.6% | |||||||||||
157,244 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $157,244) | 157,244 | |||||||||
Total Investments (Cost $28,957,869)—100.6% | 26,769,840 | ||||||||||
Liabilities in excess of other assets—(0.6%) | (153,698 | ) | |||||||||
Net Assets—100.0% | $ | 26,616,142 |
REIT Real Estate Investment Trust.
See Notes to Financial Statements.
34
Schedule of Investments
PowerShares High Yield Equity Dividend AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—102.7% | |||||||||||
Banks—66.4% | |||||||||||
105,917 | Associated Banc-Corp | $ | 2,994,274 | ||||||||
114,217 | Bank of America Corp. | 4,287,706 | |||||||||
103,961 | BB&T Corp. | 3,564,823 | |||||||||
128,316 | Chemical Financial Corp. | 3,115,512 | |||||||||
614,769 | Colonial BancGroup (The), Inc. | 5,004,220 | |||||||||
136,628 | Comerica, Inc. | 4,745,090 | |||||||||
715,186 | Corus Bankshares, Inc. | 5,242,313 | |||||||||
251,676 | F.N.B. Corp. | 3,890,911 | |||||||||
246,838 | Fifth Third Bancorp | 5,289,739 | |||||||||
173,568 | FirstMerit Corp. | 3,561,615 | |||||||||
244,773 | Fulton Financial Corp. | 3,052,319 | |||||||||
245,724 | Harleysville National Corp. | 3,553,169 | |||||||||
650,797 | Independent Bank Corp. | 5,193,360 | |||||||||
182,281 | KeyCorp | 4,398,441 | |||||||||
129,917 | Marshall & Ilsley Corp. | 3,245,327 | |||||||||
838,731 | National City Corp. | 5,284,005 | |||||||||
141,341 | National Penn Bancshares, Inc. | 2,358,981 | |||||||||
242,940 | Old National Bancorp | 4,156,703 | |||||||||
59,877 | Park National Corp. | 4,551,251 | |||||||||
624,830 | Provident Bankshares Corp. | 8,004,073 | |||||||||
524,031 | Royal Bancshares of Pennsylvania, Class A | 5,685,737 | |||||||||
72,527 | S&T Bancorp, Inc. | 2,470,995 | |||||||||
398,562 | Seacoast Banking Corp. of Florida | 4,188,887 | |||||||||
467,810 | South Financial Group (The), Inc. | 2,825,572 | |||||||||
51,483 | SunTrust Banks, Inc. | 2,870,177 | |||||||||
160,283 | Susquehanna Bancshares, Inc. | 3,188,029 | |||||||||
190,579 | TCF Financial Corp. | 3,316,075 | |||||||||
97,908 | U.S. Bancorp | 3,318,102 | |||||||||
149,379 | Valley National Bancorp | 2,866,583 | |||||||||
128,887 | WesBanco, Inc. | 2,772,359 | |||||||||
134,310 | Whitney Holding Corp. | 3,144,197 | |||||||||
122,140,545 | |||||||||||
Diversified Financial Services—2.0% | |||||||||||
143,938 | Citigroup, Inc. | 3,637,313 | |||||||||
Electric—9.2% | |||||||||||
91,520 | Consolidated Edison, Inc. | 3,807,231 | |||||||||
123,314 | Energy East Corp. | 2,811,559 | |||||||||
73,331 | Integrys Energy Group, Inc. | 3,511,822 | |||||||||
96,705 | Pinnacle West Capital Corp. | 3,282,168 | |||||||||
85,745 | Progress Energy, Inc. | 3,600,433 | |||||||||
17,013,213 | |||||||||||
Gas—3.5% | |||||||||||
117,285 | Atmos Energy Corp. | 3,246,448 | |||||||||
111,909 | Vectren Corp. | 3,164,787 | |||||||||
6,411,235 | |||||||||||
Home Builders—1.2% | |||||||||||
143,445 | D.R. Horton, Inc. | 2,221,963 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Home Furnishings—0.6% | |||||||||||
178,515 | La-Z-Boy, Inc. | $ | 1,137,141 | ||||||||
Insurance—1.9% | |||||||||||
141,854 | Arthur J. Gallagher & Co. | 3,485,353 | |||||||||
Investment Companies—4.2% | |||||||||||
241,231 | American Capital Strategies Ltd. | 7,659,084 | |||||||||
Media—4.0% | |||||||||||
299,476 | Media General, Inc., Class A | 4,396,307 | |||||||||
154,937 | New York Times (The) Co., Class A | 3,021,272 | |||||||||
7,417,579 | |||||||||||
Miscellaneous Manufacturing—2.2% | |||||||||||
249,680 | Leggett & Platt, Inc. | 4,144,688 | |||||||||
Pharmaceuticals—2.1% | |||||||||||
195,221 | Pfizer, Inc. | 3,925,894 | |||||||||
Retail—1.8% | |||||||||||
407,729 | Talbots, Inc. | 3,274,064 | |||||||||
Savings & Loans—3.6% | |||||||||||
122,809 | Astoria Financial Corp. | 2,910,573 | |||||||||
298,554 | Washington Mutual, Inc. | 3,669,229 | |||||||||
6,579,802 | |||||||||||
Total Common Stocks (Cost $248,243,066) | 189,047,874 | ||||||||||
Money Market Fund—0.5% | |||||||||||
854,643 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $854,643) | 854,643 | |||||||||
Total Investments (Cost $249,097,709)—103.2% | 189,902,517 | ||||||||||
Liabilities in excess of other assets—(3.2%) | (5,825,899 | ) | |||||||||
Net Assets—100.0% | $ | 184,076,618 |
See Notes to Financial Statements.
35
Schedule of Investments
PowerShares International Dividend AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.1% | |||||||||||
Australia—3.6% | |||||||||||
43,594 | BHP Billiton Ltd. ADR | $ | 3,516,292 | ||||||||
95,056 | Santos Ltd. ADR | 5,684,349 | |||||||||
91,867 | Westpac Banking Corp. ADR | 10,652,897 | |||||||||
19,853,538 | |||||||||||
Bahamas—0.9% | |||||||||||
107,213 | Teekay Corp. | 4,893,201 | |||||||||
Bermuda—3.1% | |||||||||||
115,997 | Max Capital Group Ltd. | 2,715,490 | |||||||||
66,620 | RenaissanceRe Holdings Ltd. | 3,426,933 | |||||||||
332,484 | Tsakos Energy Navigation Ltd. | 10,805,730 | |||||||||
16,948,153 | |||||||||||
Canada—22.2% | |||||||||||
259,474 | Bank of Montreal | 12,965,915 | |||||||||
179,745 | Bank of Nova Scotia | 8,564,849 | |||||||||
123,209 | Brookfield Asset Management, Inc., Class A | 4,031,398 | |||||||||
306,674 | Brookfield Properties Corp. | 6,173,348 | |||||||||
41,378 | Cameco Corp. | 1,447,816 | |||||||||
155,521 | Canadian Imperial Bank of Commerce | 11,451,011 | |||||||||
73,491 | Canadian National Railway Co. | 3,850,193 | |||||||||
14,392 | Canadian Natural Resources Ltd. | 1,223,320 | |||||||||
157,393 | Enbridge, Inc. | 6,481,444 | |||||||||
54,192 | EnCana Corp. | 4,379,256 | |||||||||
24,743 | Imperial Oil Ltd. | 1,448,455 | |||||||||
134,219 | Manulife Financial Corp. | 5,256,016 | |||||||||
176,652 | Methanex Corp. | 4,144,256 | |||||||||
187,686 | Royal Bank of Canada | 8,977,021 | |||||||||
389,464 | Shaw Communications, Inc., Class B | 8,268,320 | |||||||||
132,513 | Sun Life Financial, Inc. | 6,432,181 | |||||||||
7,503 | Suncor Energy, Inc. | 845,513 | |||||||||
200,683 | Talisman Energy, Inc. | 4,089,920 | |||||||||
181,416 | Thomson (The) Corp. | 6,821,242 | |||||||||
116,778 | Toronto-Dominion (The) Bank | 7,675,818 | |||||||||
212,888 | TransCanada Corp. | 7,821,505 | |||||||||
122,348,797 | |||||||||||
Cayman Islands—0.4% | |||||||||||
104,526 | Consolidated Water Co., Inc. | 2,477,266 | |||||||||
Chile—0.4% | |||||||||||
80,821 | Sociedad Quimica y Minera de Chile S.A. ADR | 2,304,207 | |||||||||
China—2.0% | |||||||||||
325,596 | Huaneng Power International, Inc. ADR | 10,956,305 | |||||||||
Denmark—0.4% | |||||||||||
32,140 | Novo-Nordisk A/S ADR | 2,207,697 | |||||||||
Finland—0.7% | |||||||||||
130,003 | Nokia Oyj Corp. ADR | 3,909,190 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
France—1.2% | |||||||||||
35,463 | Dassault Systemes S.A. ADR | $ | 2,223,175 | ||||||||
58,943 | Veolia Environnement ADR | 4,270,420 | |||||||||
6,493,595 | |||||||||||
Germany—2.2% | |||||||||||
213,084 | Allianz SE ADR | 4,321,344 | |||||||||
38,601 | Fresenius Medical Care AG ADR | 2,042,765 | |||||||||
40,751 | SAP AG ADR | 2,046,923 | |||||||||
30,522 | Siemens AG ADR | 3,615,331 | |||||||||
12,026,363 | |||||||||||
India—0.5% | |||||||||||
9,598 | HDFC Bank Ltd. ADR | 1,082,654 | |||||||||
55,469 | Satyam Computer Services Ltd. ADR | 1,424,444 | |||||||||
2,507,098 | |||||||||||
Ireland—5.2% | |||||||||||
254,178 | Allied Irish Banks PLC ADR | 10,835,608 | |||||||||
219,393 | Bank of Ireland ADR | 12,163,148 | |||||||||
146,945 | CRH PLC ADR | 5,675,016 | |||||||||
28,673,772 | |||||||||||
Israel—0.3% | |||||||||||
34,893 | Teva Pharmaceutical Industries Ltd. ADR | 1,632,295 | |||||||||
Italy—0.6% | |||||||||||
127,468 | Luxottica Group SpA ADR | 3,581,851 | |||||||||
Japan—6.3% | |||||||||||
92,466 | Canon, Inc. ADR | 4,620,526 | |||||||||
129,310 | Honda Motor Co. Ltd. ADR | 4,105,593 | |||||||||
51,110 | Kubota Corp. ADR | 1,779,139 | |||||||||
14,919 | Kyocera Corp. ADR | 1,361,060 | |||||||||
147,979 | Matsushita Electric Industrial Co. Ltd. ADR | 3,458,269 | |||||||||
4,247 | Mitsui & Co. Ltd. ADR | 1,994,773 | |||||||||
87,001 | Nidec Corp. ADR | 1,650,409 | |||||||||
90,613 | Nippon Telegraph & Telephone Corp. ADR | 1,947,273 | |||||||||
212,844 | NTT DoCoMo, Inc. ADR | 3,118,165 | |||||||||
41,039 | ORIX Corp. ADR | 3,724,700 | |||||||||
65,737 | TDK Corp. ADR | 4,516,132 | |||||||||
24,600 | Toyota Motor Corp. ADR | 2,496,900 | |||||||||
34,772,939 | |||||||||||
Mexico—0.2% | |||||||||||
21,018 | America Movil SAB de CV ADR | 1,218,203 | |||||||||
Netherlands—5.3% | |||||||||||
276,702 | ING Groep N.V. ADR | 10,511,909 | |||||||||
159,984 | Koninklijke Philips Electronics N.V. | 6,008,999 | |||||||||
166,864 | Reed Elsevier N.V. ADR | 6,274,088 | |||||||||
187,545 | Unilever N.V. | 6,290,259 | |||||||||
29,085,255 |
See Notes to Financial Statements.
36
Schedule of Investments (Continued)
PowerShares International Dividend AchieversTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Peru—1.0% | |||||||||||
25,721 | Compania de Minas Buenaventura S.A. ADR | $ | 1,609,363 | ||||||||
47,789 | Credicorp Ltd. | 3,840,324 | |||||||||
5,449,687 | |||||||||||
Portugal—1.7% | |||||||||||
787,275 | Portugal Telecom SGPS S.A. ADR | 9,368,573 | |||||||||
Russia—0.8% | |||||||||||
59,163 | Mobile Telesystems OJSC ADR | 4,589,866 | |||||||||
South Africa—1.0% | |||||||||||
98,713 | Sasol Ltd. ADR | 5,592,091 | |||||||||
Spain—4.2% | |||||||||||
403,170 | Banco Bilbao Vizcaya Argentina S.A. ADR | 9,240,656 | |||||||||
328,984 | Banco Santander Central Hispanic S.A. ADR | 6,938,273 | |||||||||
165,912 | Repsol YPF S.A. ADR | 6,731,050 | |||||||||
22,909,979 | |||||||||||
United Kingdom—31.1% | |||||||||||
248,402 | AstraZeneca PLC ADR | 10,427,916 | |||||||||
414,281 | Barclays PLC ADR | 15,079,828 | |||||||||
54,588 | BHP Billiton PLC ADR | 3,934,703 | |||||||||
138,009 | BP PLC ADR | 10,045,675 | |||||||||
93,294 | British American Tobacco PLC ADR | 7,047,428 | |||||||||
338,208 | BT Group PLC ADR | 14,928,501 | |||||||||
122,629 | Cadbury Schweppes PLC ADR | 5,653,197 | |||||||||
85,684 | Diageo PLC ADR | 7,017,520 | |||||||||
134,702 | HSBC Holdings PLC ADR | 11,690,787 | |||||||||
62,133 | Imperial Tobacco Group PLC ADR | 5,964,147 | |||||||||
127,652 | National Grid PLC ADR | 9,031,379 | |||||||||
706,003 | Pearson PLC ADR | 9,298,060 | |||||||||
122,591 | Reed Elsevier PLC ADR | 6,203,105 | |||||||||
937,801 | Signet Group PLC ADR | 12,988,544 | |||||||||
28,076 | Smith & Nephew PLC ADR | 1,817,359 | |||||||||
23,230 | Thomson Reuters PLC ADR | 4,341,222 | |||||||||
1,071,144 | Tomkins PLC ADR | 15,295,936 | |||||||||
184,963 | Unilever PLC ADR | 6,212,907 | |||||||||
317,089 | Vodafone Group PLC ADR | 10,039,038 | |||||||||
71,571 | WPP Group PLC ADR | 4,382,292 | |||||||||
171,399,544 | |||||||||||
United States—4.8% | |||||||||||
70,445 | ACE Ltd. | 4,247,129 | |||||||||
13,739 | Bunge Ltd. | 1,567,483 | |||||||||
198,256 | Carnival Corp. | 7,963,944 | |||||||||
49,808 | Everest Re Group Ltd. | 4,500,153 | |||||||||
77,976 | Ingersoll-Rand Co. Ltd., Class A | 3,460,575 | |||||||||
64,894 | PartnerRe Ltd. | 4,800,858 | |||||||||
26,540,142 | |||||||||||
Total Common Stocks (Cost $578,541,904) | 551,739,607 |
Number of Shares | Value | ||||||||||
Money Market Fund—0.1% | |||||||||||
723,283 | Goldman Sachs Financial Square Prime | ||||||||||
Obligations Institutional Share Class | |||||||||||
(Cost $723,283) | $ | 723,283 | |||||||||
Total Investments (Cost $579,265,187)—100.2% | 552,462,890 | ||||||||||
Liabilities in excess of other assets—(0.2%) | (833,381 | ) | |||||||||
Net Assets—100.0% | $ | 551,629,509 |
ADR American Depositary Receipt.
See Notes to Financial Statements.
37
Statements of Assets and Liabilities
April 30, 2008
PowerShares Buyback AchieversTM Portfolio | PowerShares Dividend AchieversTM Portfolio | PowerShares Financial Preferred Portfolio | |||||||||||||
ASSETS: | |||||||||||||||
Investments at value | $ | 61,367,932 | $ | 59,664,393 | $ | 238,290,448 | |||||||||
Receivables: | |||||||||||||||
Investments sold | 2,639,261 | 1,916,887 | 6,237,316 | ||||||||||||
Dividends | 28,188 | 79,176 | 282,203 | ||||||||||||
Shares sold | — | 1,614,900 | 2,116,524 | ||||||||||||
Expense waivers due from Adviser | — | 11,049 | — | ||||||||||||
Total Assets | 64,035,381 | 63,286,405 | 246,926,491 | ||||||||||||
LIABILITIES: | |||||||||||||||
Due to custodian | 170,679 | 15,057 | 2,254,615 | ||||||||||||
Payables: | |||||||||||||||
Investments purchased | 2,647,799 | 1,833,456 | 7,369,100 | ||||||||||||
Shares repurchased | — | 1,614,900 | — | ||||||||||||
Expense recapture due to Adviser | 8,014 | — | 395 | ||||||||||||
Accrued advisory fees | 24,744 | 19,394 | 90,846 | ||||||||||||
Accrued expenses | 52,418 | 52,281 | 85,472 | ||||||||||||
Total Liabilities | 2,903,654 | 3,535,088 | 9,800,428 | ||||||||||||
NET ASSETS | $ | 61,131,727 | $ | 59,751,317 | $ | 237,126,063 | |||||||||
NET ASSETS CONSIST OF: | |||||||||||||||
Shares of beneficial interest | $ | 73,359,330 | $ | 62,900,037 | $ | 257,332,856 | |||||||||
Undistributed net investment income (loss) | 8,111 | 126,779 | (596,894 | ) | |||||||||||
Accumulated net realized loss on investments | (9,391,745 | ) | (1,179,995 | ) | (11,718,743 | ) | |||||||||
Net unrealized appreciation (depreciation) of investments | (2,843,969 | ) | (2,095,504 | ) | (7,891,156 | ) | |||||||||
Net Assets | $ | 61,131,727 | $ | 59,751,317 | $ | 237,126,063 | |||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 2,700,000 | 3,700,000 | 11,200,000 | ||||||||||||
Net asset value | $ | 22.64 | $ | 16.15 | $ | 21.17 | |||||||||
Investments at cost | $ | 64,211,901 | $ | 61,759,897 | $ | 246,181,604 |
See Notes to Financial Statements.
38
PowerShares High Growth Rate Dividend AchieversTM Portfolio | PowerShares High Yield Equity Dividend AchieversTM Portfolio | PowerShares International Dividend AchieversTM Portfolio | |||||||||||||
ASSETS: | |||||||||||||||
Investments at value | $ | 26,769,840 | $ | 189,902,517 | $ | 552,462,890 | |||||||||
Receivables: | |||||||||||||||
Investments sold | 1,360,897 | 17,783,794 | 44,201,532 | ||||||||||||
Dividends | 11,079 | 503,462 | 3,955,392 | ||||||||||||
Shares sold | 1,478,675 | — | 15,704,752 | ||||||||||||
Expense waivers due from Adviser | 7,790 | — | 18,082 | ||||||||||||
Total Assets | 29,628,281 | 208,189,773 | 616,342,648 | ||||||||||||
LIABILITIES: | |||||||||||||||
Due to custodian | 136,118 | 930,902 | 3,950,856 | ||||||||||||
Payables: | |||||||||||||||
Investments purchased | 1,351,218 | 22,981,790 | 44,720,034 | ||||||||||||
Shares repurchased | 1,478,675 | — | 15,704,752 | ||||||||||||
Expense recapture due to Adviser | — | 51,136 | — | ||||||||||||
Accrued advisory fees | 8,632 | 63,263 | 178,137 | ||||||||||||
Accrued expenses | 37,496 | 86,064 | 159,360 | ||||||||||||
Total Liabilities | 3,012,139 | 24,113,155 | 64,713,139 | ||||||||||||
NET ASSETS | $ | 26,616,142 | $ | 184,076,618 | $ | 551,629,509 | |||||||||
NET ASSETS CONSIST OF: | |||||||||||||||
Shares of beneficial interest | $ | 30,412,345 | $ | 289,132,833 | $ | 606,678,405 | |||||||||
Undistributed net investment income (loss) | 49,895 | — | 4,436,318 | ||||||||||||
Accumulated net realized loss on investments | (1,658,069 | ) | (45,861,023 | ) | (32,682,917 | ) | |||||||||
Net unrealized appreciation (depreciation) of investments | (2,188,029 | ) | (59,195,192 | ) | (26,802,297 | ) | |||||||||
Net Assets | $ | 26,616,142 | $ | 184,076,618 | $ | 551,629,509 | |||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 1,800,000 | 16,200,000 | 28,100,000 | ||||||||||||
Net asset value | $ | 14.79 | $ | 11.36 | $ | 19.63 | |||||||||
Investments at cost | $ | 28,957,869 | $ | 249,097,709 | $ | 579,265,187 |
39
Statements of Operations
Year Ended April 30, 2008
PowerShares Buyback AchieversTM Portfolio | PowerShares Dividend AchieversTM Portfolio | PowerShares Financial Preferred Portfolio | |||||||||||||
INVESTMENT INCOME: | |||||||||||||||
Unaffiliated dividend income | $ | 901,381 | $ | 1,902,641 | $ | 9,659,874 | |||||||||
Affiliated money market dividend income | — | 9,548 | 9,788 | ||||||||||||
Foreign withholding tax | — | — | — | ||||||||||||
Total Income | 901,381 | 1,912,189 | 9,669,662 | ||||||||||||
EXPENSES: | |||||||||||||||
Advisory fees | 395,906 | 277,676 | 698,666 | ||||||||||||
Administration & accounting fees | 80,000 | 80,738 | 79,267 | ||||||||||||
Sub-licensing | 79,181 | 69,419 | 139,733 | ||||||||||||
Offering costs | 21,605 | — | 27,965 | ||||||||||||
Audit | 16,006 | 15,848 | 16,006 | ||||||||||||
Printing | 11,602 | 12,141 | 29,991 | ||||||||||||
Custodian & transfer agent fees | 7,942 | 6,625 | 9,779 | ||||||||||||
Trustees | 6,702 | 6,402 | 7,879 | ||||||||||||
Registration & filings | 537 | — | 3,551 | ||||||||||||
Listing fee and expenses | 103 | 9,057 | 163 | ||||||||||||
Legal | — | 2,878 | — | ||||||||||||
Other expenses | 9,573 | 17,853 | 14,138 | ||||||||||||
Total Expenses | 629,157 | 498,637 | 1,027,138 | ||||||||||||
(Waivers) and/or Recapture | (53,284 | ) | (82,124 | ) | (21,041 | ) | |||||||||
Net Expenses | 575,873 | 416,513 | 1,006,097 | ||||||||||||
Net Investment Income | 325,508 | 1,495,676 | 8,663,565 | ||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||
Net realized gain (loss) from: | |||||||||||||||
Investments | (9,151,701 | ) | (1,079,235 | ) | (11,586,200 | ) | |||||||||
In-kind redemptions | 1,675,309 | 2,280,026 | (105,571 | ) | |||||||||||
Net realized gain (loss) | (7,476,392 | ) | 1,200,791 | (11,691,771 | ) | ||||||||||
Net change in unrealized depreciation on investments | (4,232,518 | ) | (8,075,983 | ) | (7,396,935 | ) | |||||||||
Net realized and unrealized loss on investments | (11,708,910 | ) | (6,875,192 | ) | (19,088,706 | ) | |||||||||
Net decrease in net assets resulting from operations | $ | (11,383,402 | ) | $ | (5,379,516 | ) | $ | (10,425,141 | ) |
See Notes to Financial Statements.
40
PowerShares High Growth Rate Dividend AchieversTM Portfolio | PowerShares High Yield Equity Dividend AchieversTM Portfolio | PowerShares International Dividend AchieversTM Portfolio | |||||||||||||
INVESTMENT INCOME: | |||||||||||||||
Unaffiliated dividend income | $ | 877,444 | $ | 14,999,176 | $ | 26,679,514 | |||||||||
Affiliated money market dividend income | 4,352 | 22,068 | 6,285 | ||||||||||||
Foreign withholding tax | — | — | (1,368,535 | ) | |||||||||||
Total Income | 881,796 | 15,021,244 | 25,317,264 | ||||||||||||
EXPENSES: | |||||||||||||||
Advisory fees | 138,921 | 1,213,426 | 2,624,245 | ||||||||||||
Administration & accounting fees | 80,738 | 93,035 | 187,365 | ||||||||||||
Sub-licensing | 34,730 | 303,356 | 656,061 | ||||||||||||
Offering costs | — | — | — | ||||||||||||
Audit | 15,848 | 15,848 | 15,848 | ||||||||||||
Printing | 2,191 | — | 88,120 | ||||||||||||
Custodian & transfer agent fees | 6,520 | 19,210 | 36,605 | ||||||||||||
Trustees | 5,427 | 13,477 | 22,683 | ||||||||||||
Registration & filings | — | — | 106 | ||||||||||||
Listing fee and expenses | 9,004 | 8,451 | 8,021 | ||||||||||||
Legal | 518 | 10,458 | 22,755 | ||||||||||||
Other expenses | 14,470 | 35,188 | 42,837 | ||||||||||||
Total Expenses | 308,367 | 1,712,449 | 3,704,646 | ||||||||||||
(Waivers) and/or Recapture | (99,985 | ) | 107,690 | 73,473 | |||||||||||
Net Expenses | 208,382 | 1,820,139 | 3,778,119 | ||||||||||||
Net Investment Income | 673,414 | 13,201,105 | 21,539,145 | ||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||
Net realized gain (loss) from: | |||||||||||||||
Investments | (1,425,148 | ) | (35,860,322 | ) | (28,242,031 | ) | |||||||||
In-kind redemptions | 948,460 | (535,598 | ) | 71,200,420 | |||||||||||
Net realized gain (loss) | (476,688 | ) | (36,395,920 | ) | 42,958,389 | ||||||||||
Net change in unrealized depreciation on investments | (4,296,368 | ) | (52,406,008 | ) | (69,656,191 | ) | |||||||||
Net realized and unrealized loss on investments | (4,773,056 | ) | (88,801,928 | ) | (26,697,802 | ) | |||||||||
Net decrease in net assets resulting from operations | $ | (4,099,642 | ) | $ | (75,600,823 | ) | $ | (5,158,657 | ) |
41
Statements of Changes in Net Assets
PowerShares Buyback AchieversTM Portfolio | PowerShares Dividend AchieversTM Portfolio | PowerShares Financial Preferred Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | For the Period December 20, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | For the Period December 01, 2006* Through April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income | $ | 325,508 | $ | 20,428 | $ | 1,495,676 | $ | 891,157 | $ | 8,663,565 | $ | 1,065,631 | |||||||||||||||
Net realized gain (loss) on investments | (7,476,392 | ) | 403,046 | 1,200,791 | 852,815 | (11,691,771 | ) | 38,292 | |||||||||||||||||||
Net change in unrealized appreciation/depreciation of investments | (4,232,518 | ) | 1,388,549 | (8,075,983 | ) | 4,770,653 | (7,396,935 | ) | (494,221 | ) | |||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (11,383,402 | ) | 1,812,023 | (5,379,516 | ) | 6,514,625 | (10,425,141 | ) | 609,702 | ||||||||||||||||||
Undistributed net investment income/(loss) included in the price of units issued and redeemed | (19,113 | ) | 19,385 | (22,948 | ) | 70,102 | 213,903 | 193,038 | |||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (298,099 | ) | (39,938 | ) | (1,373,568 | ) | (892,954 | ) | (9,274,921 | ) | (1,336,352 | ) | |||||||||||||||
Return of capital | — | — | — | — | — | — | |||||||||||||||||||||
Total distributions to shareholders | (298,099 | ) | (39,938 | ) | (1,373,568 | ) | (892,954 | ) | (9,274,921 | ) | (1,336,352 | ) | |||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 52,711,783 | 78,476,709 | 19,181,334 | 49,447,993 | 183,234,804 | 104,833,729 | |||||||||||||||||||||
Value of shares repurchased | (42,281,695 | ) | (17,865,654 | ) | (22,755,868 | ) | (8,439,931 | ) | (25,526,919 | ) | (4,988,839 | ) | |||||||||||||||
Net income equalization | 19,113 | (19,385 | ) | 22,948 | (70,102 | ) | (213,903 | ) | (193,038 | ) | |||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 10,449,201 | 60,591,670 | (3,551,586 | ) | 40,937,960 | 157,493,982 | 99,651,852 | ||||||||||||||||||||
Increase (Decrease) in Net Assets | (1,251,413 | ) | 62,383,140 | (10,327,618 | ) | 46,629,733 | 138,007,823 | 99,118,240 | |||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 62,383,140 | — | 70,078,935 | 23,449,202 | 99,118,240 | — | |||||||||||||||||||||
End of period | $ | 61,131,727 | $ | 62,383,140 | $ | 59,751,317 | $ | 70,078,935 | $ | 237,126,063 | $ | 99,118,240 | |||||||||||||||
Undistributed net investment income (loss) at end of period | $ | 8,111 | $ | — | $ | 126,779 | $ | 14,002 | $ | (596,894 | ) | $ | — | ||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 2,100,000 | 3,100,000 | 1,100,000 | 3,000,000 | 8,400,000 | 4,200,000 | |||||||||||||||||||||
Shares repurchased | (1,800,000 | ) | (700,000 | ) | (1,400,000 | ) | (500,000 | ) | (1,200,000 | ) | (200,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 2,400,000 | — | 4,000,000 | 1,500,000 | 4,000,000 | — | |||||||||||||||||||||
Shares outstanding, end of period | 2,700,000 | 2,400,000 | 3,700,000 | 4,000,000 | 11,200,000 | 4,000,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
42
PowerShares High Growth Rate Dividend AchieversTM Portfolio | PowerShares High Yield Equity Dividend AchieversTM Portfolio | PowerShares International Dividend AchieversTM Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income | $ | 673,414 | $ | 625,435 | $ | 13,201,105 | $ | 15,167,615 | $ | 21,539,145 | $ | 9,691,791 | |||||||||||||||
Net realized gain (loss) on investments | (476,688 | ) | 1,149,160 | (36,395,920 | ) | 21,966,940 | 42,958,389 | 30,945,521 | |||||||||||||||||||
Net change in unrealized appreciation/depreciation of investments | (4,296,368 | ) | 643,486 | (52,406,008 | ) | 594,916 | (69,656,191 | ) | 34,368,081 | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (4,099,642 | ) | 2,418,081 | (75,600,823 | ) | 37,729,471 | (5,158,657 | ) | 75,005,393 | ||||||||||||||||||
Undistributed net investment income/(loss) included in the price of units issued and redeemed | (28,800 | ) | 14,460 | 442,069 | (112,827 | ) | (572,269 | ) | 2,016,764 | ||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (624,614 | ) | (627,388 | ) | (13,201,105 | ) | (16,754,893 | ) | (17,781,400 | ) | (9,485,475 | ) | |||||||||||||||
Return of capital | — | — | (533,357 | ) | (788,801 | ) | — | — | |||||||||||||||||||
Total distributions to shareholders | (624,614 | ) | (627,388 | ) | (13,734,462 | ) | (17,543,694 | ) | (17,781,400 | ) | (9,485,475 | ) | |||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 6,189,314 | 26,475,751 | 74,348,539 | 191,978,674 | 511,488,063 | 518,438,866 | |||||||||||||||||||||
Value of shares repurchased | (16,976,446 | ) | (13,366,288 | ) | (240,757,005 | ) | (232,033,594 | ) | (490,118,492 | ) | (201,601,419 | ) | |||||||||||||||
Net income equalization | 28,800 | (14,460 | ) | (442,069 | ) | 112,827 | 572,269 | (2,016,764 | ) | ||||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | (10,758,332 | ) | 13,095,003 | (166,850,535 | ) | (39,942,093 | ) | 21,941,840 | 314,820,683 | ||||||||||||||||||
Increase (Decrease) in Net Assets | (15,511,388 | ) | 14,900,156 | (255,743,751 | ) | (19,869,143 | ) | (1,570,486 | ) | 382,357,365 | |||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 42,127,530 | 27,227,374 | 439,820,369 | 459,689,512 | 553,199,995 | 170,842,630 | |||||||||||||||||||||
End of period | $ | 26,616,142 | $ | 42,127,530 | $ | 184,076,618 | $ | 439,820,369 | $ | 551,629,509 | $ | 553,199,995 | |||||||||||||||
Undistributed net investment income (loss) at end of period | $ | 49,895 | $ | 15,907 | $ | — | $ | — | $ | 4,436,318 | $ | 678,573 | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 400,000 | 1,600,000 | 5,300,000 | 12,000,000 | 24,900,000 | 28,200,000 | |||||||||||||||||||||
Shares repurchased | (1,100,000 | ) | (800,000 | ) | (16,900,000 | ) | (14,700,000 | ) | (24,300,000 | ) | (10,800,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 2,500,000 | 1,700,000 | 27,800,000 | 30,500,000 | 27,500,000 | 10,100,000 | |||||||||||||||||||||
Shares outstanding, end of period | 1,800,000 | 2,500,000 | 16,200,000 | 27,800,000 | 28,100,000 | 27,500,000 |
43
Financial Highlights
PowerShares Buyback AchieversTM Portfolio
Year Ended April 30, 2008 | For the Period December 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 25.99 | $ | 24.98 | |||||||
Net investment income** | 0.10 | 0.01 | |||||||||
Net realized and unrealized gain (loss) on investments | (3.35 | ) | 1.02 | ||||||||
Total from operations | (3.25 | ) | 1.03 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.10 | ) | (0.02 | ) | |||||||
Net asset value at end of period | $ | 22.64 | $ | 25.99 | |||||||
TOTAL RETURN*** | (12.53 | )% | 4.13 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 61,132 | $ | 62,383 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.73 | % | 0.73 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.79 | % | 1.04 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.41 | % | 0.15 | %† | |||||||
Portfolio turnover rate †† | 46 | % | 38 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | (0.01 | ) | $ | 0.01 |
PowerShares Dividend AchieversTM Portfolio
Year Ended April 30, | For the Period September 15, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 17.52 | $ | 15.63 | $ | 14.84 | |||||||||
Net investment income** | 0.37 | 0.32 | 0.17 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (1.41 | ) | 1.88 | 0.78 | |||||||||||
Total from operations | (1.04 | ) | 2.20 | 0.95 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.33 | ) | (0.31 | ) | (0.16 | ) | |||||||||
Net asset value at end of period | $ | 16.15 | $ | 17.52 | $ | 15.63 | |||||||||
TOTAL RETURN*** | (6.00 | )% | 14.26 | % | 6.45 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 59,751 | $ | 70,079 | $ | 23,449 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.60 | % | 0.60 | % | 0.67 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.72 | % | 0.92 | % | 1.02 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 2.15 | % | 1.94 | % | 1.81 | %† | |||||||||
Portfolio turnover rate †† | 8 | % | 9 | % | 8 | % | |||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | (0.01 | ) | $ | 0.03 | $ | — | (a) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
44
Financial Highlights (Continued)
PowerShares Financial Preferred Portfolio
Year Ended April 30, 2008 | For the Period December 1, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 24.78 | $ | 25.12 | |||||||
Net investment income** | 1.35 | 0.41 | |||||||||
Net realized and unrealized loss on investments | (3.50 | ) | (0.12 | ) | |||||||
Total from operations | (2.15 | ) | 0.29 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (1.46 | ) | (0.63 | ) | |||||||
Net asset value at end of period | $ | 21.17 | $ | 24.78 | |||||||
TOTAL RETURN*** | (8.77 | )% | 1.18 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 237,126 | $ | 99,118 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.72 | % | 0.72 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.74 | % | 0.89 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 6.20 | % | 4.63 | %† | |||||||
Portfolio turnover rate †† | 80 | % | 0 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.03 | $ | 0.07 |
PowerShares High Growth Rate Dividend AchieversTM Portfolio
Year Ended April 30, | For the Period September 15, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 16.85 | $ | 16.02 | $ | 14.78 | |||||||||
Net investment income** | 0.31 | 0.30 | 0.15 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (2.08 | ) | 0.83 | 1.24 | |||||||||||
Total from operations | (1.77 | ) | 1.13 | 1.39 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.29 | ) | (0.30 | ) | (0.15 | ) | |||||||||
Net asset value at end of period | $ | 14.79 | $ | 16.85 | $ | 16.02 | |||||||||
TOTAL RETURN*** | (10.58 | )% | 7.11 | % | 9.39 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 26,616 | $ | 42,128 | $ | 27,227 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.60 | % | 0.61 | % | 0.66 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.89 | % | 1.04 | % | 1.00 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 1.94 | % | 1.86 | % | 1.59 | %† | |||||||||
Portfolio turnover rate †† | 16 | % | 12 | % | 20 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.01 | ) | $ | 0.01 | $ | — | (a) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
45
Financial Highlights (Continued)
PowerShares High Yield Equity Dividend AchieversTM Portfolio
Year Ended April 30, | For the Period December 9, 2004* Through | ||||||||||||||||||
2008 | 2007 | 2006 | April 30, 2005 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||||||
Net asset value at beginning of period | $ | 15.82 | $ | 15.07 | $ | 14.41 | $ | 14.79 | |||||||||||
Net investment income** | 0.62 | 0.54 | 0.53 | 0.18 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (4.42 | ) | 0.84 | 0.61 | (0.39 | ) | |||||||||||||
Total from operations | (3.80 | ) | 1.38 | 1.14 | (0.21 | ) | |||||||||||||
Distributions to shareholders from: | |||||||||||||||||||
Net investment income | (0.63 | ) | (0.60 | ) | (0.48 | ) | (0.17 | ) | |||||||||||
Return of capital | (0.03 | ) | (0.03 | ) | — | — | |||||||||||||
Total distributions | (0.66 | ) | (0.63 | ) | (0.48 | ) | (0.17 | ) | |||||||||||
Net asset value at end of period | $ | 11.36 | $ | 15.82 | $ | 15.07 | $ | 14.41 | |||||||||||
TOTAL RETURN*** | (24.67 | )% | 9.28 | % | 7.92 | % | (1.44 | )% | |||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||
Net assets at end of period (000's omitted) | $ | 184,077 | $ | 439,820 | $ | 459,690 | $ | 314,245 | |||||||||||
Ratio to average net assets of: | |||||||||||||||||||
Expenses, after Waivers and/or Recapture | 0.60 | % | 0.60 | % | 0.61 | % | 0.60 | %† | |||||||||||
Expenses, prior to Waivers and/or Recapture | 0.56 | % | 0.60 | % | 0.65 | % | 0.66 | %† | |||||||||||
Net investment income, after Waivers and/or Recapture | 4.35 | % | 3.47 | % | 3.49 | % | 3.57 | %† | |||||||||||
Portfolio turnover rate †† | 42 | % | 20 | % | 9 | % | 21 | % | |||||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.02 | $ | — | (a) | $ | 0.02 | — |
PowerShares International Dividend AchieversTM Portfolio
Year Ended April 30, | For the Period September 15, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 20.12 | $ | 16.92 | $ | 14.96 | |||||||||
Net investment income** | 0.68 | 0.53 | 0.28 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (0.61 | ) | 3.20 | 1.88 | |||||||||||
Total from operations | 0.07 | 3.73 | 2.16 | ||||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.56 | ) | (0.53 | ) | (0.20 | ) | |||||||||
Net asset value at end of period | $ | 19.63 | $ | 20.12 | $ | 16.92 | |||||||||
TOTAL RETURN*** | 0.34 | % | 22.56 | % | 14.50 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 551,630 | $ | 553,200 | $ | 170,843 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.58 | % | 0.60 | % | 0.62 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.56 | % | 0.62 | % | 0.69 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 3.28 | % | 2.98 | % | 3.06 | %† | |||||||||
Portfolio turnover rate †† | 43 | % | 22 | % | 8 | % | |||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | (0.02 | ) | $ | 0.11 | $ | 0.04 |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
46
Notes to Financial Statements
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the "Trust") was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company, registered under the Investment Company Act of 1940, as amended (the "1940 Act"). As of period end, the Trust offers seventy-three portfolios. This report includes the following portfolios:
PowerShares Buyback AchieversTM Portfolio | "Buyback AchieversTM Portfolio" | ||||||
PowerShares Dividend AchieversTM Portfolio | "Dividend AchieversTM Portfolio" | ||||||
PowerShares Financial Preferred Portfolio | "Financial Preferred Portfolio" | ||||||
PowerShares High Growth Rate Dividend AchieversTM Portfolio | "High Growth Rate Dividend AchieversTM Portfolio" | ||||||
PowerShares High Yield Equity Dividend AchieversTM Portfolio | "High Yield Equity Dividend AchieversTM Portfolio" | ||||||
PowerShares International Dividend AchieversTM Portfolio | "International Dividend AchieversTM Portfolio" | ||||||
Each portfolio (the "Fund" or collectively the "Funds") represents a separate series of the Trust. Each Fund's shares are listed and traded on the American Stock Exchange. The Funds' market prices may differ to some degree from the net asset value of the shares of each Fund. Unlike conventional mutual funds, each Fund issues and redeems shares on a continuous basis, at net asset value, only in a large specified number of shares, each called a "Creation Unit." Creation Units are issued and redeemed generally in-kind for securities included in the relevant index. Except when aggregated in Creation Units, shares are not individually redeemable securities of the Funds. The investment objective of each Fund is to seek investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of the following equity indices:
Fund | Index | ||||||
Buyback AchieversTM Portfolio | Share BuyBack AchieversTM Index | ||||||
Dividend AchieversTM Portfolio | Broad Dividend AchieversTM Index | ||||||
Financial Preferred Portfolio | Wachovia Hybrid & Preferred Securities Financial Index | ||||||
High Growth Rate Dividend AchieversTM Portfolio | High Growth Rate Dividend AchieversTM Index | ||||||
High Yield Equity Dividend AchieversTM Portfolio | Dividend AchieversTM 50 Index | ||||||
International Dividend AchieversTM Portfolio | International Dividend AchieversTM Index | ||||||
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates.
A. Security Valuation
Securities, including restricted securities, are valued according to the following policy.
47
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
A security listed or traded on an exchange (except convertible bonds) 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. Listed options if no closing price is available are valued at the mean between the last bid and the ask 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 ask prices.
Investments in open-end registered investment companies are valued at the end of day net asset value per share.
Debt obligations (including convertible bonds) 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, yield, quality, type of issue, coupon rate, maturity, individual trading characteristics and other market data. Short-term obligations, including commercial paper, having 60 days or less to maturity are recorded at amortized cost which approximates value. Debt securities are subject to interest rate and credit risks. In addition, all debt securities involve some risk of default with respect to interest and/or principal payments.
Foreign securities (including foreign exchange contracts) are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. 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 are significant and may 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 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, ADRs 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.
Securities for which market quotations are not readily available or are unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust's officers following procedures
48
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
approved by the Board of Trustees. Issuer specific events, market trends, bid/ask 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.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer's assets, general economic conditions, interest rates, investor perceptions and market liquidity.
B. Other Risk
The Funds may concentrate in a comparatively narrow segment of the economy. Consequently, such Fund may tend to be more volatile than other funds, and the value of the investments may tend to rise and fall more rapidly.
Investments in the securities of non-U.S. issuers may have greater risk than those investments in U.S. securities. Investments in securities denominated in foreign currencies are subject to risk of adverse changes in currency exchange rates which may negatively impact returns. The risk can also be associated with the level of development of the economies of the countries in a specific region.
When investing in securities of a limited number of companies, each investment has a greater effect on the Fund's overall performance, and any change in the value of those securities could significantly affect the value of your investment in the Fund.
C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and will distribute substantially all of the Funds' taxable earnings to its shareholders. As such, the Funds will not be subject to Federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for Federal income taxes is included.
Income and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from accounting principles generally accepted in the United States. These differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and Passive Foreign Investment Company adjustments, if any.
The Funds file tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
D. Investment Income and Investment Transactions
Dividend income is recorded on the ex-dividend date net of foreign taxes withheld, if any. Interest income is recorded on the accrual basis. Investment transactions are recorded on the trade date. Realized gains and losses from the sale or disposition of securities are calculated on the specific identified cost basis. Dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
49
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
E. Expenses
Expenses of the Trust, which are directly identifiable to a specific Fund, are applied to that Fund. Expenses which are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, any distribution fees or expenses and extraordinary expenses.
F. Dividends and Distributions to Shareholders
Each Fund (except for the High Yield Equity Dividend AchieversTM Portfolio and Financial Preferred Portfolio, which declare and pay dividends monthly) declares and pays dividends from net investment income, if any, to its shareholders quarterly and distributes net realized taxable capital gains, if any, annually in cash. Such distributions on a tax basis are determined in conformity with income tax regulations which may differ from accounting principles generally accepted in the United States of America. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund's financial statements as a tax return of capital at fiscal period end.
G. Equalization
All Funds use the accounting practice of equalization. This accounting method is used to keep the continuing shareholder's per share equity in undistributed net investment income from being affected by the continuous sales and redemptions of capital shares. Equalization is calculated on a per share basis whereby a portion of the proceeds from the sales and cost of repurchases of capital shares is applied to undistributed net investment income. The amount of equalization is disclosed in the Statements of Changes in Net Assets as undistributed net investment income included in the price of capital shares issued or redeemed. The distributions to shareholders of amounts so applied may be deemed to be a return of capital for tax purposes to the extent that such distributions exceed taxable income.
Note 3. Advisory and Administration Agreements
The Trust has entered into an Investment Advisory Agreement with Invesco PowerShares Capital Management LLC (formerly PowerShares Capital Management LLC) ("the Adviser") under which the Adviser has overall responsibility as the Funds' investment adviser for the selection and ongoing monitoring of the Funds' investments, managing the Funds' business affairs and providing certain clerical, bookkeeping and other administrative services. The fees paid by each Fund to the Adviser are accrued daily and are payable at 0.40% per annum on each Fund's average daily net assets except for the Buyback AchieversTM Portfolio and Financial Preferred Portfolio, which pay 0.50% per annum on the Funds' average daily net assets.
The Adviser has entered into an Amended and Restated Excess Expense Agreement ("Excess Expense Agreement") with the Trust, under which the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses of the Funds (excluding interest expense, brokerage commissions and other trading expenses, sub-licensing fees, offering costs, taxes and extraordinary expenses) from exceeding 0.50% of average daily net assets per year (0.60% per year for
50
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
the Buyback AchieversTM Portfolio and Financial Preferred Portfolio) (the "Expense Cap"), at least until August 30, 2009. Offering costs excluded from the Expense Cap are: (a) legal fees pertaining to the Funds' shares offered for sale; (b) Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange.
The Excess Expense Agreement provides that expenses borne by the Adviser are subject to recapture by the Adviser for up to three years from the date the fee or expense was borne by the Adviser, but no recapture payment will be made by a Fund if it would result in the Fund exceeding its Expense Cap as specified above.
The net amount of fees waived and other expenses assumed by the Adviser and the amount of recapture paid to the Adviser pursuant to the Excess Expense Agreement are collectively referred to as "Waivers and/or Recapture".
During the year ended April 30, 2008, the amount of "Waivers and/or Recapture" was as follows:
(Waivers) and/or Recapture | |||||||
Buyback AchieversTM Portfolio | $ | (53,284 | ) | ||||
Dividend AchieversTM Portfolio | (82,124 | ) | |||||
Financial Preferred Portfolio | (21,041 | ) | |||||
High Growth Rate Dividend AchieversTM Portfolio | (99,985 | ) | |||||
High Yield Equity Dividend AchieversTM Portfolio | 107,690 | ||||||
International Dividend AchieversTM Portfolio | 73,473 |
The net amounts of Waivers and/or Recapture are also shown on the Statements of Operations.
The amounts available for potential future recapture by the Adviser under the Excess Expense Agreement and the expiration schedule at April 30, 2008 are as follows:
Total Potential | Potential Recapture Amounts Expiring | ||||||||||||||||||
Recapture Amount | 04/30/09 | 04/30/10 | 04/30/11 | ||||||||||||||||
Buyback AchieversTM Portfolio | $ | 95,766 | $ | — | $ | 31,575 | $ | 64,191 | |||||||||||
Dividend AchieversTM Portfolio | 290,060 | 51,164 | 150,733 | 88,163 | |||||||||||||||
Financial Preferred Portfolio | 60,049 | — | 21,227 | 38,822 | |||||||||||||||
High Growth Rate Dividend AchieversTM Portfolio | 303,223 | 57,069 | 144,263 | 101,891 | |||||||||||||||
High Yield Equity Dividend AchieversTM Portfolio | 70,161 | 827 | 67,569 | 1,765 | |||||||||||||||
International Dividend AchieversTM Portfolio | 18,082 | — | — | 18,082 |
Distribution Agreement
The Trust has entered into a Distribution Agreement with Invesco Aim Distributors, Inc. (formerly A I M Distributors, Inc.) (the "Distributor") which serves as the Distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in Shares.
51
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Licensing Fee Agreements
The Adviser has entered into licensing agreements for each Fund with the following Licensor:
Fund | Licensor | ||||||
Buyback AchieversTM Portfolio | Mergent, Inc. | ||||||
Dividend AchieversTM Portfolio | Mergent, Inc. | ||||||
Financial Preferred Portfolio | Wachovia Capital Markets, LLC | ||||||
High Growth Rate Dividend AchieversTM Portfolio | Mergent, Inc. | ||||||
High Yield Equity Dividend AchieversTM Portfolio | Mergent, Inc. | ||||||
International Dividend AchieversTM Portfolio | Mergent, Inc. | ||||||
The above trademarks are owned by the respective Licensors. These trademarks have been licensed to the Adviser for use with the Funds. The Funds are not sponsored, endorsed, sold or promoted by the Licensors and the Licensors make no representation regarding the advisability of investing in any of these Funds. The Funds are required to pay the sub-licensing fees which are shown on the Statements of Operations.
The Bank of New York, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian and fund accounting and transfer agent for each Fund.
The custodian has agreed to provide overdraft protection to the Funds according to the terms of the service agreement.
Note 4. Federal Income Tax
At April 30, 2008, costs of investments on a tax-basis including the adjustments for financial reporting purposes as of the most recently completed Federal income tax reporting year were as follows:
Buyback AchieversTM Portfolio | $ | 64,325,981 | |||||
Dividend AchieversTM Portfolio | 61,880,724 | ||||||
Financial Preferred Portfolio(1) | 135,579,866 | ||||||
High Growth Rate Dividend AchieversTM Portfolio | 29,133,953 | ||||||
High Yield Equity Dividend AchieversTM Portfolio | 252,002,633 | ||||||
International Dividend AchieversTM Portfolio | 581,092,294 |
At April 30, 2008, the components of accumulated earnings/loss on a tax-basis including the adjustments for financial reporting purposes as of the most recently completed Federal income tax reporting year were as follows:
Accumulated Earnings | Net Accumulated Capital and other Gains/Losses | Unrealized Appreciation/ Depreciation | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Total Accumulated Earnings/Loss | ||||||||||||||||||||||
Buyback AchieversTM Portfolio | $ | 8,111 | $ | (9,277,665 | ) | $ | (2,958,049 | ) | $ | 2,828,982 | $ | (5,787,031 | ) | $ | (12,227,603 | ) | |||||||||||
Dividend AchieversTM Portfolio | 126,779 | (59,973 | ) | (2,216,331 | ) | 4,550,853 | (6,767,184 | ) | (2,149,525 | ) | |||||||||||||||||
Financial Preferred Portfolio(1) | 9,656 | (2,445,445 | ) | (8,412,946 | ) | 25,289 | (8,438,235 | ) | (10,848,735 | ) | |||||||||||||||||
High Growth Rate Dividend AchieversTM Portfolio | 49,895 | (403,475 | ) | (2,364,113 | ) | 1,769,702 | (4,133,815 | ) | (2,717,693 | ) | |||||||||||||||||
High Yield Equity Dividend AchieversTM Portfolio | — | (14,784,993 | ) | (62,100,116 | ) | 462,906 | (62,563,022 | ) | (76,885,109 | ) | |||||||||||||||||
International Dividend AchieversTM Portfolio | 4,436,318 | (2,380,278 | ) | (28,629,404 | ) | 18,653,248 | (47,282,652 | ) | (26,573,364 | ) |
52
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Distributions to Shareholders:
The tax character of distributions paid was as follows:
Period ended April 30, 2008 | Period ended April 30, 2007 | ||||||||||
Distributions paid from Ordinary Income | Distributions paid from Ordinary Income | ||||||||||
Buyback AchieversTM Portfolio | $ | 298,099 | $ | 39,938 | |||||||
Dividend AchieversTM Portfolio | 1,373,568 | 892,954 | |||||||||
Financial Preferred Portfolio(1) | 4,465,491 | 1,336,352 | |||||||||
High Growth Rate Dividend AchieversTM Portfolio | 624,614 | 627,388 | |||||||||
High Yield Equity Dividend AchieversTM Portfolio | 13,201,105 | 16,754,893 | |||||||||
International Dividend AchieversTM Portfolio | 17,781,400 | 9,485,475 | |||||||||
Period ended April 30, 2008 | Period ended April 30, 2007 | ||||||||||
Distributions paid from Return of Capital | Distributions paid from Return of Capital | ||||||||||
High Yield Equity Dividend AchieversTM Portfolio | $ | 533,357 | $ | 788,801 |
At April 30, 2008, for Federal income tax purposes, the Funds have capital loss carryforwards available as shown in the table below, to the extent provided by the regulations, to offset future capital gains through the years indicated. To the extent that these loss carryforwards are used to offset future capital gains, it is probable that the capital gains so offset will not be distributed to shareholders. The use of some portion of the capital loss carryforwards by any one fund may be limited by Federal tax rules. These rules limit the use of the carryforwards when there has been a greater than fifty percent change in ownership of a fund.
Year of Expiration | Total | ||||||||||||||||||
2014 | 2015 | 2016 | Amount | ||||||||||||||||
Buyback AchieversTM Portfolio | $ | — | $ | 178,870 | $ | 9,098,795 | $ | 9,277,665 | |||||||||||
Dividend AchieversTM Portfolio | 7,896 | — | 52,077 | 59,973 | |||||||||||||||
Financial Preferred Portfolio(1) | — | 2,445,445 | — | 2,445,445 | |||||||||||||||
High Growth Rate Dividend AchieversTM Portfolio | 1,847 | 15,651 | 385,977 | 403,475 | |||||||||||||||
High Yield Equity Dividend AchieversTM Portfolio | 2,613,033 | 7,009,598 | 5,162,362 | 14,784,993 | |||||||||||||||
International Dividend AchieversTM Portfolio | 183,478 | 221,461 | 1,975,339 | 2,380,278 |
Capital losses incurred after October 31 ("post-October losses") within the taxable year are deemed to arise on the first business day of each Fund's next taxable year.
53
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
During the year ended April 30, 2008, the Funds incurred and will elect to defer net capital losses as follows:
Post-October Losses | |||||||
Buyback AchieversTM Portfolio | $ | — | |||||
Dividend AchieversTM Portfolio | 999,195 | ||||||
Financial Preferred Portfolio(1) | — | ||||||
High Growth Rate Dividend AchieversTM Portfolio | 1,078,510 | ||||||
High Yield Equity Dividend AchieversTM Portfolio | 28,171,106 | ||||||
International Dividend AchieversTM Portfolio | 28,475,532 |
In order to present shares of beneficial interest and accumulated net realized gains or losses on the Statements of Assets and Liabilities that more closely represent their tax character, certain adjustments have been made to shares of beneficial interest, undistributed net investment income or loss and net realized gains or losses on investments. These differences are primarily due to redemptions in-kind, investments in partnerships, wash sales, book equalization, and net operating losses, if any. These adjustments have no effect on net assets. For the year ended April 30, 2008, the adjustments were as follows:
Undistributed Net Investment Income (Loss) | Undistributed Capital Gains/ (Accumulated Losses) | Shares of Beneficial Interest | |||||||||||||
Buyback AchieversTM Portfolio | $ | (185 | ) | $ | (1,614,432 | ) | $ | 1,614,617 | |||||||
Dividend AchieversTM Portfolio | 13,617 | (2,249,381 | ) | 2,235,764 | |||||||||||
Financial Preferred Portfolio(1) | (199,441 | ) | (26,972 | ) | 226,413 | ||||||||||
High Growth Rate Dividend AchieversTM Portfolio | 13,988 | (922,067 | ) | 908,079 | |||||||||||
High Yield Equity Dividend AchieversTM Portfolio | 91,288 | 1,194,570 | (1,285,858 | ) | |||||||||||
International Dividend AchieversTM Portfolio | 572,269 | (70,085,744 | ) | 69,513,475 |
(1) Tax year-end is October 31
Note 5. Investment Transactions
For the year ended April 30, 2008, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, money market funds and in-kind transactions, were as follows:
Purchases | Sales | ||||||||||
Buyback AchieversTM Portfolio | $ | 35,596,539 | $ | 41,032,238 | |||||||
Dividend AchieversTM Portfolio | 5,430,803 | 5,869,058 | |||||||||
Financial Preferred Portfolio | 114,449,829 | 114,688,377 | |||||||||
High Growth Rate Dividend AchieversTM Portfolio | 5,586,754 | 5,484,324 | |||||||||
High Yield Equity Dividend AchieversTM Portfolio | 135,525,963 | 127,809,534 | |||||||||
International Dividend AchieversTM Portfolio | 300,561,611 | 279,019,021 |
54
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
For the year ended April 30, 2008, in-kind transactions were as follows:
Securities Received | Securities Delivered | ||||||||||
Buyback AchieversTM Portfolio | $ | 57,304,730 | $ | 41,383,532 | |||||||
Dividend AchieversTM Portfolio | 16,653,490 | 19,923,293 | |||||||||
Financial Preferred Portfolio | 183,279,675 | 25,463,514 | |||||||||
High Growth Rate Dividend AchieversTM Portfolio | 3,669,878 | 14,408,823 | |||||||||
High Yield Equity Dividend AchieversTM Portfolio | 70,378,329 | 238,151,564 | |||||||||
International Dividend AchieversTM Portfolio | 484,823,155 | 482,130,869 |
Gains on in-kind transactions are not considered taxable gains for Federal income tax purposes.
Note 6. Trustees' Fees
The Funds compensate each Trustee on behalf of the Trust who is not an employee of the Trust or its affiliates. Interested Trustees and Officers of the Trust do not receive any Trustees' fees.
The Trust (has adopted a deferred compensation plan (the "Plan"). Under the Plan, a trustee who is not an "interested person" (as defined in the 1940 Act) and has elected to participate in the Plan (a "participating trustee") may defer receipt of all or a portion of his compensation ("Deferral Fees"). Such Deferred Fees are deemed to be invested in selected PowerShares Funds. The Deferral Fees payable to the participating trustee is valued as of the first business dates of each calendar quarter such Fees would have been paid to the participating trustee. The value selected increases with contributions or with increases in the value of the shares selected, and the value decreases with withdrawals or with declines in the value of the shares selected.
Note 7. Capital
Shares are created and redeemed by the Trust only in Creation Unit size aggregations of 100,000. Only authorized participants are permitted to create or redeem from the Funds. Such transactions are generally permitted on an in-kind basis, with a balancing cash component to equate the transaction to the net asset value per unit of each Fund of the Trust on the transaction date. Cash may be substituted equivalent to the value of certain securities generally when they are not available in sufficient quantity for delivery, not be eligible for trading by the Authorized Participant or as a result of other market circumstances.
Note 8. Indemnifications
Under the Trust's organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust's maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
55
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 9. New Accounting Pronouncement
On September 20, 2006, the FASB released Statement of Financial Accounting Standards No. 157 "Fair Value Measurement" ("FAS 157"). FAS 157 establishes an authoritative definition of fair value, sets out a framework for measuring fair value, and requires additional disclosures about fair-value measurement. The application of FAS 157 is required for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. Management has assessed the application of FAS 157 to the Funds and has determined that the adoption of FAS 157 is not expected to have a material impact on the Funds. Management intends for the Funds to adopt FAS 157 provisions during the fiscal year ending April 30, 2009.
56
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of each of the portfolios indicated in Note 1 of the financial statements (each a portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the "Trust") at April 30, 2008, and the results of each of their operations, the changes in each of their net assets, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Trust's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2008 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
New York, New York
June 30, 2008
57
Supplemental Information
Federal Income Tax Information
The percentages of investment income (dividend income plus short-term gains, if any) qualify as follows:
Qualified dividend income | Dividends-received deduction | ||||||||||
Buyback AchieversTM Portfolio | 100 | % | 100 | % | |||||||
Dividend AchieversTM Portfolio | 100 | % | 100 | % | |||||||
Financial Preferred Portfolio | 100 | % | 91 | % | |||||||
High Growth Rate Dividend AchieversTM Portfolio | 100 | % | 100 | % | |||||||
High Yield Equity Dividend AchieversTM Portfolio | 100 | % | 100 | % | |||||||
International Dividend AchieversTM Portfolio | 100 | % | 0 | % |
58
Supplemental Information (Continued)
Trustees and Officers
The Trustees who are not affiliated with the Adviser ("Independent Trustees") or affiliates of the Adviser and the Trustee who is affiliated with the Adviser ("Management Trustee") and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by the Trustee, are shown below.
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Ronn R. Bagge (b. 1958) YQA Capital Management, LLC 1/755 S. Naperville Rd., Suite 100 Wheaton, IL 60187 | Trustee | Since 2003 | YQA Capital Management LLC (July 1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider) | 104 | None | ||||||||||||||||||
Marc M. Kole (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | Assistant Vice President and Controller, Priority Health (September 2005- April 2008); formerly, Interim CFO, Priority Health (July 2006-April 2007); formerly Senior Vice President of Finance, United Healthcare (health insurance) (July 2004-July 2005); formerly Senior Vice President of Finance, Oxford Health Plans (June 2000-July 2004) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
59
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
D. Mark McMillan (b. 1963) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Partner, Bell, Boyd & Lloyd LLP (1989-Present) | 104 | None | ||||||||||||||||||
Philip M. Nussbaum (b. 1961) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (formerly Betzold, Berg, Nussbaum & Heitman, Inc.) (November 2004-Present); formerly Managing Director, Communication Institute (May 2002-August 2003); formerly Executive Vice President of Finance, Betzold, Berg, Nussbaum & Heitman, Inc. (March 1994-1999) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
60
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex ** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Donald H. Wilson (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | President, Chief Operating Officer and Chief Financial Officer, AMCORE Financial, Inc. (bank holding company) (August 2007- Present); formerly Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (February 2006- August 2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (May 1995- February 2006) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
61
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Management Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex*** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
H. Bruce Bond (b.1963)** Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chairman of the Board, Trustee and Chief Executive Officer | Since 2003 | Managing Director, Invesco PowerShares Capital Management LLC (August 2002-Present); formerly Manager, Nuveen Investments (April 1998-August 2002) | 104 | None | ||||||||||||||||||
Availability of Additional Information About Funds' Trustees
The Statement of Additional Information includes additional information about the Funds' Trustees and is available, without charge, upon request at 800.337.4246.
* This is the date the Management Trustee began serving the Trust.
** Interested person as defined in Section 2(a)(19) of the 1940 Act.
*** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
62
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Officers | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | ||||||||||||
Bruce T. Duncan (b. 1954) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Financial Officer and Treasurer and Secretary | Chief Financial Officer and Treasurer Since 2006 Secretary Since 2008 | Senior Vice President of Finance, Invesco PowerShares Capital Management LLC (September 2005-Present); Private Practice Attorney (2000-2005); Vice President of Investor Relations, The ServiceMaster Company (1994-2000); Vice President of Taxes, The ServiceMaster Company (1990-2000) | ||||||||||||
Kevin R. Gustafson (b. 1965) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Compliance Officer | Since 2004 | General Counsel, Invesco PowerShares Capital Management LLC (September 2004-Present); Chief Compliance Officer, Invesco PowerShares Capital Management LLC (September 2004-April 2008) Attorney, Nyberg & Gustafson (2001-2004); Attorney, Burke, Warren, McKay & Serritella, P.C. (1997-2000) | ||||||||||||
* This is the period for which the Officers began serving the Trust. Each Officer serves a one year term, until his successor is elected.
63
Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 18, 2008, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the "Trust"), including the Independent Trustees, unanimously approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the "Adviser") and the Trust for the following 70 series (the "Funds"):
PowerShares Dynamic Market Portfolio
PowerShares Dynamic OTC Portfolio
PowerShares Golden Dragon Halter USX China Portfolio
PowerShares High Yield Equity Dividend AchieversTM Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Mid Cap Growth Portfolio
PowerShares Dynamic Mid Cap Value Portfolio
PowerShares Dynamic Small Cap Growth Portfolio
PowerShares Dynamic Small Cap Value Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Zacks Micro Cap Portfolio
PowerShares Aerospace & Defense Portfolio
PowerShares Dynamic Hardware & Consumer Electronics Portfolio
PowerShares Dynamic Telecommunications & Wireless Portfolio
PowerShares Value Line Timeliness Select Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares High Growth Rate Dividend AchieversTM Portfolio
PowerShares Zacks Small Cap Portfolio
PowerShares Dynamic Building and Construction Portfolio
PowerShares Dynamic Energy Exploration and Production Portfolio
PowerShares Dynamic Insurance Portfolio
PowerShares Dynamic Oil and Gas Services Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Utilities Portfolio
PowerShares Lux Nanotech Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares Water Resources Portfolio
PowerShares Dynamic Energy Sector Portfolio
PowerShares Dynamic Financial Sector Portfolio
PowerShares Dynamic Healthcare Sector Portfolio
PowerShares Dynamic Industrials Sector Portfolio
PowerShares Dynamic Large Cap Portfolio
PowerShares Dynamic MagniQuant Portfolio
PowerShares Dynamic Mid Cap Portfolio
PowerShares Dynamic Small Cap Portfolio
PowerShares Dynamic Technology Sector Portfolio
PowerShares Buyback AchieversTM Portfolio
PowerShares FTSE RAFI Basic Materials Sector Portfolio
PowerShares FTSE RAFI Consumer Goods Sector Portfolio
PowerShares FTSE RAFI Consumer Services Sector Portfolio
PowerShares FTSE RAFI Energy Sector Portfolio
PowerShares FTSE RAFI Financials Sector Portfolio
PowerShares FTSE RAFI Health Care Sector Portfolio
PowerShares FTSE RAFI Industrials Sector Portfolio
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
64
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
PowerShares FTSE RAFI Utilities Sector Portfolio
PowerShares Cleantech Portfolio
PowerShares Dynamic Aggressive Growth Portfolio
PowerShares Dynamic Banking Portfolio
PowerShares Dynamic Basic Materials Sector Portfolio
PowerShares Dynamic Consumer Discretionary Sector Portfolio
PowerShares Dynamic Consumer Staples Sector Portfolio
PowerShares Dynamic Healthcare Services Portfolio
PowerShares Dynamic Deep Value Portfolio
PowerShares Financial Preferred Portfolio
PowerShares Listed Private Equity Portfolio
PowerShares DWA Technical Leaders Portfolio
PowerShares Value Line Industry Rotation Portfolio
PowerShares WilderHill Progressive Energy Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as the Funds grow, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered and amounts paid to other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser's services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser's current organization, including operations assistance provided by the Adviser's parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser's portfolio transaction policies and procedures. The Trustees reviewed information on the performance of the Funds and the performance of their benchmark indices. The Trustees also reviewed reports on the correlation and tracking error between the underlying index and each Fund's performance and reviewed a report of Ibbotson Associates, a c onsultant to the Independent Trustees, that analyzed the reasons for any tracking error for certain of the Funds, which the Adviser then applied to its analysis of the tracking error between the underlying index and the performance of each Fund. The Trustees noted that, in each case, the correlation and tracking error was within the range set forth in the registration statement. The Trustees also concluded that each of the Funds is correlated to its underlying index and that the tracking error for each Fund was within a reasonable range in that Fund's particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds' administrator, custodian and transfer agent. They noted the significant amount of time and effort that had been devoted to this oversight function.
Based on their review, the Trustees found that the nature and extent of services provided to the Funds under the Investment Advisory Agreement are appropriate and that the quality is good.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund's expense ratio and the advisory fee, as compared to three categories of comparable
65
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
funds selected by Lipper Inc., an independent source: exchange-traded index funds ("ETFs"), open-end (non-ETF) index funds and open-end actively-managed funds. The Adviser supplemented the information prepared by Lipper Inc. with data it compiled on expense ratios and advisory fees of newer ETFs that recently commenced operations. The Trustees noted that the annual advisory fee charged to the Funds was identical (0.50% of average net assets), except for the advisory fee for the PowerShares High Yield Equity Dividend AchieversTM Portfolio, the PowerShares Dividend AchieversTM Portfolio, the PowerShares High Growth Rate Dividend AchieversTM Portfolio and the PowerShares International Dividend AchieversTM Portfolio (for each of which the annual advisory fee was 0.40% of average net assets), and that the Adviser had agreed to waive the fee and/or pay expenses to the extent necessary to pre vent the annual operating expenses of each Fund (excluding interest expenses, licensing fees and offering costs (for all Funds other than the initial two Funds, the PowerShares Dynamic OTC Portfolio and the PowerShares Dynamic Market Portfolio), brokerage commissions and other trading expenses, taxes and extraordinary expenses) from exceeding 0.60% of average net assets (0.50% of average net assets for the PowerShares High Yield Equity Dividend AchieversTM Portfolio, the PowerShares Dividend AchieversTM Portfolio, the PowerShares High Growth Rate Dividend AchieversTM Portfolio and the PowerShares International Dividend AchieversTM Portfolio) at least until April 30, 2009. The Trustees noted that the Adviser represented that it does not provide investment management services to clients other than the Trust and other exchange-traded funds overseen by the Board. The Trustees noted that the advisory fees were at the higher end of the ETF peer funds, but were lower than the median of the open-end actively-managed peer funds. The Trustees determined that the advisory fees were reasonable because of the complexity of the indices, which generally require more frequent rebalancing of the portfolios, the distinguishing factors of the Funds, and the higher administrative, operational and management oversight costs for the Adviser. With respect to the Funds' expense ratios, the Trustees noted that the net expense ratios were at the higher end of the ETF peer funds, but were generally lower than the median of the expense ratios of the open-end (non-ETF) index peer funds and the median of the open-end actively-managed peer funds. The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds. The Board concluded that the advisory fee and expense ratio of each Fund are competitive and that the advisory fee for each Fund is reasonable and appropriate in amount in light of the quality of services provided and the expense cap in place.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability as well as any profits realized by the Adviser from its relationship to each Fund. The Trustees concluded that the profitability to the Adviser of the advisory services provided to the Funds is not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund's asset size, expense ratio, expense limitation agreed to by the Adviser and whether the investment process produced economies of scale. The Trustees noted that certain fixed costs associated with the management of the Funds are being reduced on a per-Fund basis as additional Funds are added, and that the gradual reduction of the per-Fund cost enabled the Adviser to operate some of the Funds under the expense cap, which potentially would lower the costs to shareholders. The Trustees noted that
66
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
the Excess Expense Agreement with the Trust provided that the Adviser was entitled to be reimbursed by each Fund for fees waived or expenses absorbed pursuant to the expense cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its expense cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds, and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
67
This page intentionally left blank
PROXY VOTING POLICIES AND PROCEDURES
A description of the Funds' proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 337-4246. This information is also available on the Securities and Exchange Commission's ("Commission") website at www.sec.gov.
Information regarding how the Funds voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 337-4246; or (ii) accessing the Funds' Form N-PX on the Commission's website at www.sec.gov.
QUARTERLY PORTFOLIOS
The Funds file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds' Forms N-Q are available on the Commission's website at www.sec.gov. The Funds' Forms N-Q may also be reviewed and copied at the Commission's Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
There are risks involved in investing in ETFs, including possible loss of money. Investing in securities of small and medium sized companies involves greater risk than is customarily associated with investing in more established companies, and investments in concentrated industry sectors involve greater risks than investments that are more diversified. PowerShares ETFs are not actively managed and are subject to risks similar to stocks, including those related to short selling and margin maintenance. PowerShares ETFs are not FDIC insured, may lose value and have no bank guarantee. PowerShares is a registered trademark of Invesco PowerShares Capital Management LLC. Past performance is not a guarantee of future results.
Invesco Aim Distributors, Inc. is the distributor of the PowerShares Exchange-Traded Fund Trust.
An investor should consider each Fund's investment objective, risks, charges and expenses carefully before investing. For more complete information about PowerShares ETFs call Invesco Aim Distributors, Inc. at (800) 337-4246 or visit our website invescopowershares.com for a prospectus. Please read the prospectus carefully before investing.
301 West Roosevelt Road
Wheaton, IL 60187
800.983.0903
www.invescopowershares.com
© 2008 Invesco PowerShares Capital Management LLC P-PS-AR-1
2008 Annual Report to Shareholders
30 April 2008
PowerShares Aerospace & Defense Portfolio
PowerShares CleantechTM Portfolio
PowerShares DWA Technical LeadersTM Portfolio
PowerShares Golden Dragon Halter USX China Portfolio
PowerShares Listed Private Equity Portfolio
PowerShares Lux Nanotech Portfolio
PowerShares S&P 500 BuyWrite Portfolio
PowerShares Value Line Industry Rotation Portfolio
PowerShares Value Line TimelinessTM Select Portfolio
PowerShares Water Resources Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares WilderHill Progressive Energy Portfolio
Table of Contents
Shareholder Letter | 2 | ||||||
The Market Environment | 3 | ||||||
Manager's Analysis | 4 | ||||||
Funds' Distribution History | 32 | ||||||
Frequency Distribution of Discounts & Premiums | 34 | ||||||
Fees and Expenses | 36 | ||||||
Specialty Portfolios | |||||||
Schedules of Investments | |||||||
PowerShares Aerospace & Defense Portfolio | 38 | ||||||
PowerShares CleantechTM Portfolio | 39 | ||||||
PowerShares DWA Technical LeadersTM Portfolio | 40 | ||||||
PowerShares Golden Dragon Halter USX China Portfolio | 42 | ||||||
PowerShares Listed Private Equity Portfolio | 44 | ||||||
PowerShares Lux Nanotech Portfolio | 45 | ||||||
PowerShares S&P 500 BuyWrite Portfolio | 46 | ||||||
PowerShares Value Line Industry Rotation Portfolio | 52 | ||||||
PowerShares Value Line TimelinessTM Select Portfolio | 54 | ||||||
PowerShares Water Resources Portfolio | 55 | ||||||
PowerShares WilderHill Clean Energy Portfolio | 56 | ||||||
PowerShares WilderHill Progressive Energy Portfolio | 57 | ||||||
Statements of Assets and Liabilities | 58 | ||||||
Statements of Operations | 60 | ||||||
Statements of Changes in Net Assets | 62 | ||||||
Financial Highlights | 66 | ||||||
Notes to Financial Statements | 72 | ||||||
Report of Independent Registered Public Accounting Firm | 87 | ||||||
Supplemental Information | 88 | ||||||
Information about Advisory Agreements | 94 | ||||||
To My Fellow Investors,
It gives me great pleasure to report on the state of your investment in PowerShares Exchange-Traded Funds and to thank you for your continued confidence in Invesco PowerShares Capital Management LLC.
Invesco PowerShares has accomplished a number of corporate and industry achievements in 2007. Some of the most notable successes over the past 12 months are that PowerShares:
• Was the first to receive approval from the SEC to operate actively managed equity and fixed-income ETFs.
• Launched our initial group of international ETFs, which invest directly in securities listed on foreign exchanges. As of April 30, 2008, we had 17 ETFs allowing investors to invest across a wide geographic range.
• Brought out the markets only ETFs investing in insured municipal bonds. These three ETF's were part of our initial entry into the Fixed Income portion of the investment spectrum.
• Further enhanced our reputation as one of the leading innovators in the ETF marketplace when the PowerShares S&P Buy-Write Portfolio was awarded the most innovative new ETF for 2007.
• Expanded our global footprint with the introduction of 14 PowerShares ETFs listed on four major stock exchanges across Europe (London, Milan, Frankfurt and Paris).
• Launched the PowerShares India Portfolio, one of the first ETFs to provide U.S. investors with direct access to securities listed on the India stock exchange.
Another milestone of the past year was the adoption of our new name, Invesco PowerShares – in short, we have a new corporate name. Invesco PowerShares represents the strength of global diversification you get through the combination of Invesco's worldwide resources and PowerShares' market leading ETF capabilities. As one of the world's largest and most diversified global investment organizations, Invesco has more than 500 investment professionals operating in investment centers in 25 cities, a presence in 12 countries and $500 billion in assets under management globally at the end of 2007.
While our name has changed and we have a new corporate logo, our goal of delivering the highest quality investment management available in the ETF structure has not changed and all of the names of your funds and their trading symbols remain the same – as do all of our telephone contact numbers. All of us at Invesco PowerShares will continue to strive to provide you with compelling investment solutions and high-quality customer service. Regardless of market conditions, Invesco PowerShares will hold true to its mission: seeking to build financial security for investors.
Best regards,
H. Bruce Bond
President and Chairman of the Board of Trustees
PowerShares Exchange-Traded Fund Trust
2
The Market Environment
Although the benchmark S&P 500 index hit an all-time high in October, 2007, it capitulated as the subprime mortgage crisis began to negatively affect the balance sheets of major U.S. financial institutions. As a result, volatility (as measured by the CBOE "VIX" index) increased by 46.2% during the April 30, 2007 to April 30, 2008 reporting period. Another dramatic rise over the same timeframe was the price of crude oil, which rallied 72.7%. U.S. economic growth began to slow significantly in Q1 2008, leading to recession concerns addressed by the Federal Reserve Bank through aggressive monetary policy easing (the Fed Fund target rate was cut by 2.25% in 2008). The combination of lower short-term U.S. interest rates and the recycling of petrodollars into European banks caused the U.S. dollar to weaken versus all G7 currencies for the year ended April 30, 2008.
By March, 2008, even the AAA-rated monoline bond insurers succumbed to the U.S. credit crunch. Bond insurer ratings downgrades led to huge displacements within the municipal bond market. An impending liquidity crisis was quelled in mid-March by the Fed via the creation of a $200bn lending facility and the approval of Bear Stearns' sale to JP Morgan. Along with the restoration of confidence in the U.S. financial system came a respectable April rally in the U.S. equity market, leaving the S&P 500 with a yearly total return of -4.68% over the reporting period while the DJIA was 0.47% and the NASDAQ-100 was +3.18%. For the same period, the Lehman Brothers U.S. Aggregate Total Return bond index was 6.87%.
3
Manager's Analysis
PowerShares Aerospace & Defense Portfolio (ticker: PPA)
The PowerShares Aerospace & Defense Portfolio continues to provide investors with a means to participate in a sector that has now beaten the S&P 500® for eight consecutive years.
During the period of this report, the fund gained 3.86%. This compares to a decline of 4.68% in the S&P 500®.
The period began with a steady progression of month-end highs that began in April 2007 and extended through October 2007. The Fund remained relatively flat through late December, declining roughly 3.00% as the broader markets began a sharp revaluation while investors fled the broader markets as problems in the financial and housing sectors worsened. The first quarter of 2008 saw investors divest many of their best performing sectors to raise cash, and combined with the announcement of a significant delay by Boeing for its new aircraft, the fund declined in concert with the markets.
Performance in the sector continues to be driven by several factors including government support for defense and homeland security activities along with an expanding marketplace for manufacturing commercial aircraft. With a portfolio defined by the underlying SPADETM Defense Index (AMEX: DXS), constituents represent a diversified offering of large cap, mid- and small-cap companies enabling the fund to capture current and future spending in areas related to defense system manufacturing, armor for vehicles and soldiers, night vision systems, border security, defense IT and network centric systems, commercial aerospace, and secure communications.
With the core defense budget forecast to grow by an additional $30 billion through 2013 and additional appropriations anticipated to fund overseas military operations, replenish and repair military systems, and develop new border security initiatives; and combined with the anticipated delivery of more than $2 trillion worth of commercial aircraft and parts over the next decade, the sector continues to feature a number of positive trends. The primary risk to the sector continues to be politics and the perception of changes in advance of any action.
4
Manager's Analysis (Continued)
PowerShares Aerospace & Defense Portfolio (ticker: PPA)
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Aerospace/Defense | 55.9 | ||||||
Miscellaneous Manufacturing | 16.3 | ||||||
Electronics | 7.1 | ||||||
Metal Fabricate/Hardware | 4.6 | ||||||
Computers | 4.0 | ||||||
Commercial Services | 3.4 | ||||||
Telecommunications | 3.3 | ||||||
Packaging & Containers | 2.0 | ||||||
Engineering & Construction | 1.5 | ||||||
Auto Manufacturers | 1.1 | ||||||
Software | 0.6 | ||||||
Money Market Fund | 0.1 | ||||||
Other | 0.1 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Large-Cap Growth | 29.8 | ||||||
Large-Cap Value | 29.8 | ||||||
Mid-Cap Growth | 22.3 | ||||||
Mid-Cap Value | 8.7 | ||||||
Small-Cap Growth | 6.8 | ||||||
Small-Cap Value | 2.6 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Boeing Co. | 7.6 | ||||||
Honeywell International, Inc. | 7.3 | ||||||
Lockheed Martin Corp. | 7.2 | ||||||
United Technologies Corp. | 7.2 | ||||||
General Dynamics Corp. | 6.2 | ||||||
Raytheon Co. | 4.7 | ||||||
ITT Corp. | 4.4 | ||||||
Precision Castparts Corp. | 4.4 | ||||||
Northrop Grumman Corp. | 4.3 | ||||||
Textron, Inc. | 4.2 | ||||||
Total | 57.5 |
5
Manager's Analysis (Continued)
PowerShares Aerospace & Defense Portfolio (ticker: PPA)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
SPADETM Defense Index | 3.65 | 14.40 | 40.35 | ||||||||||||
S&P 500® Index | -4.68 | 8.23 | 22.04 | ||||||||||||
Russell 3000® Index | -5.16 | 8.14 | 21.80 |
Fund
NAV Return | 3.86 | 14.79 | 41.36 | ||||||||||||
Share Price Return | 3.87 | 14.78 | 41.39 |
Fund Inception: 26 October 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.75%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.66% while the Fund's gross total operating expense ratio was 0.64%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index and Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 500 and 2,918 common stocks, respectively.
† Average annualized.
6
This page intentionally left blank
Manager's Analysis
PowerShares CleantechTM Portfolio (ticker: PZD)
The PowerShares Cleantech Portfolio is based on the CleantechTM Index and seeks investment results that correspond generally to the price and yield (prior to Fund fees and expenses) of the Index.
The CleantechTM Index enables investors to profit from the surging global demand for clean technology products & services as reflected by the investment returns of the leading US-traded, cleantech companies. Cleantech businesses are found across a broad range of industry sectors – from energy, water, and new materials to agriculture and transportation. As a result, the Index is far more diversified than more narrowly focused sector indices.
The Index focuses on the leading companies most representative of the growth of cleantech. Index companies must meet 18 stringent criteria for inclusion including quality, profitability, growth, strategy, sector leadership, and have strong technology/knowledge-based businesses. As such, producers of commodity products, regulated utilities, and dubious products such as grain-based fuels are excluded.
In the year ending April 30, 2008, the Fund dramatically outperformed nearly all major market indices and even many "renewable energy" indices. The Fund rose 24.19% compared to -4.68% for S&P 500® and 3.67% for the NASDAQ Composite.
Alternative energy stocks were torrid performers in 2007 and many solar energy companies advancing 100-200% or more. However, last winter's broad market decline saw many of these stocks fall far faster that the broad market. As a result, the CleantechTM Index (CTIUS) also outperformed most 'alternative energy' indices and mutual funds over the last 12 months.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Miscellaneous Manufacturing | 21.2 | ||||||
Energy-Alternate Sources | 14.1 | ||||||
Electronics | 12.6 | ||||||
Environmental Control | 8.8 | ||||||
Semiconductors | 6.6 | ||||||
Machinery-Diversified | 6.3 | ||||||
Engineering & Construction | 5.1 | ||||||
Electrical Components & Equipment | 4.0 | ||||||
Telecommunications | 3.4 | ||||||
Water | 3.2 | ||||||
Software | 2.9 | ||||||
Biotechnology | 2.4 | ||||||
Chemicals | 2.4 | ||||||
Hand/Machine Tools | 2.3 | ||||||
Electric | 2.0 | ||||||
Office Furnishings | 1.4 | ||||||
Computers | 1.3 | ||||||
Other | (0.0 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
First Solar, Inc. | 4.1 | ||||||
ABB Ltd. ADR (Switzerland) | 3.6 | ||||||
SunPower Corp., Class A | 3.5 | ||||||
Suntech Power Holdings Co. Ltd. ADR (China) | 3.5 | ||||||
Corning, Inc. | 3.4 | ||||||
Siemens AG ADR (Germany) | 3.4 | ||||||
SPX Corp. | 3.3 | ||||||
Veolia Environment ADR (France) | 3.2 | ||||||
Trimble Navigation Ltd. | 3.1 | ||||||
Donaldson Co., Inc. | 3.0 | ||||||
Total | 34.1 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Mid-Cap Growth | 34.6 | ||||||
Small-Cap Growth | 32.4 | �� | |||||
Large-Cap Growth | 25.3 | ||||||
Small-Cap Value | 7.7 |
8
Manager's Analysis (Continued)
PowerShares CleantechTM Portfolio (ticker: PZD)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
CleantechTM Index | 24.63 | 22.87 | 36.84 | ||||||||||||
NASDAQ Composite Index | -4.45 | 1.89 | 2.90 | ||||||||||||
S&P 500® Index | -4.68 | 2.34 | 3.58 |
Fund
NAV Return | 24.19 | 22.59 | 36.15 | ||||||||||||
Share Price Return | 24.13 | 22.54 | 36.14 |
Fund Inception: 24 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.32%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.69% while the Fund's gross total operating expense ratio was 0.77%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The NASDAQ Composite Index and S&P 500® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 3,087 and 500 common stocks, respectively.
† Average annualized.
9
Manager's Analysis
PowerShares DWA Technical LeadersTM Portfolio (ticker: PDP)
The PowerShares DWA Technical LeadersTM Portfolio is based on the Dorsey Wright Technical LeadersTM Index which includes approximately 100 U.S.-listed companies that demonstrate strong relative strength characteristics. The Index is constructed pursuant to Dorsey Wright proprietary methodology, which takes into account, among other factors, the performance of each of the 3,000 largest U.S.-listed companies as compared to a benchmark index, and the relative performance of industry sectors and sub-sectors. Stocks that are selected receive a modified equal weighting.
For the year ended April 30, 2008 PowerShares DWA Technical LeadersTM Portfolio returned 1.62% outperforming the Dow Jones Industrial Average Index and the S&P 500® Index which returned 0.47% and -4.68%, respectively, over the same period.
For the year ended April 30, 2008 seven of the ten sectors represented in the Fund generated positive returns. Overallocation in the industrial and material sectors and stock selection in the health care and telecommunication service sectors made the largest positive contributions to the performance of the Fund, relative to the broader US equity market. Conversely, stock selection within the consumer staples and consumer discretionary sectors and overexposure in the energy sector partially offset the positive performance of the Fund. Lastly, overallocation within mid cap growth companies was the largest contributor to the Fund's positive performance. Conversely, stock selection in small cap value companies such as Landstar System Inc. and Eagle Materials Inc. partially offset the positive performance of the portfolio.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Industrials | 27.0 | ||||||
Materials | 12.5 | ||||||
Energy | 12.0 | ||||||
Financials | 11.6 | ||||||
Health Care | 9.9 | ||||||
Consumer Discretionary | 7.1 | ||||||
Telecommunication Services | 7.0 | ||||||
Utilities | 5.2 | ||||||
Consumer Staples | 4.4 | ||||||
Information Technology | 3.3 | ||||||
Other | (0.0 | ) |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Mid-Cap Growth | 45.7 | ||||||
Large-Cap Growth | 25.1 | ||||||
Large-Cap Value | 14.3 | ||||||
Mid-Cap Value | 14.1 | ||||||
Small-Cap Value | 0.8 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
American Tower Corp., Class A | 4.2 | ||||||
McDermott International, Inc. | 3.0 | ||||||
Crown Castle International Corp. | 2.8 | ||||||
Williams (The) Cos., Inc. | 2.6 | ||||||
Covanta Holding Corp. | 2.6 | ||||||
Pediatrix Medical Group, Inc. | 2.4 | ||||||
Energizer Holdings, Inc. | 2.0 | ||||||
Ventas, Inc. | 2.0 | ||||||
Allegheny Technologies, Inc. | 1.9 | ||||||
BlackRock, Inc. | 1.6 | ||||||
Total | 25.1 |
10
Manager's Analysis (Continued)
PowerShares DWA Technical LeadersTM Portfolio (ticker: PDP)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dorsey Wright Technical LeadersTM Index | 2.26 | 7.81 | 7.82 | ||||||||||||
S&P 500® Index | -4.68 | 0.79 | 0.92 |
Fund
NAV | 1.62 | 7.29 | 8.54 | ||||||||||||
Share Price Return | 1.44 | 7.15 | 8.39 |
Fund Inception: 1 March 2007
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.96%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.71% while the Fund's gross total operating expense ratio was 0.68%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index is an unmanaged index used as a measurement of change in stock market conditions based on the average performance of approximately 500 common stocks.
† Average annualized.
11
Manager's Analysis
PowerShares Golden Dragon Halter USX China Portfolio (ticker: PGJ)
The PowerShares Golden Dragon Halter USX China Portfolio is based on the Halter USX China IndexSM. The Halter USX China IndexSM is comprised of companies whose common stock is publicly traded in the United States and the majority of whose business is conducted within the People's Republic of China. It was created by the Halter Financial Group in response to the unique economic opportunities taking place in China, as well as the current dynamics in the United States capital markets. While there is strong demand for Chinese equity, U.S. investors still seek and prefer the transparency offered with a U.S. listing. The listing of Chinese companies in the U.S. is a growing trend and this Index is intended to provide a valuable tracking and information tool for the investment community.
For the year ended April 30, 2008 the PowerShares Golden Dragon Halter USX China Portfolio returned 35.87%.
The positive performance of the Fund was largely attributable to the following securities: Baidu.com Inc., China Mobile Ltd., CNOOC Ltd., Aluminum Corp. of China Ltd., Yanzhou Coal Mining Co. Ltd., China Life Insurance Co. Ltd. Together, these securities provided 53.5% of the Fund's positive performance. Conversely, the following securities offset the positive performance of the Fund: Semiconductor Manufacturing International Corp., Yingli Green Energy Holding Co. Ltd., LDK Solar Co. Ltd., WuXi PharmaTech (Cayman) Inc. Lastly, the positive performance of the Fund was mostly attributable to stock selection within large cap growth companies such as China Mobile Ltd. and CNOOC Ltd. Furthermore, the positive performance of the Fund was also attributable to stock selection within mid cap growth companies such as Baidu.com Inc. and Yanzhou Coal Mining Co. Ltd. Conversely, part of positive performance of the Fund was offset by overallo cation to small cap growth companies.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Energy | 21.0 | ||||||
Information Technology | 19.4 | ||||||
Telecommunications Services | 18.2 | ||||||
Industrials | 12.8 | ||||||
Consumer Discretionary | 7.5 | ||||||
Materials | 5.9 | ||||||
Financials | 5.8 | ||||||
Utilities | 4.6 | ||||||
Health Care | 3.6 | ||||||
Consumer Staples | 0.9 | ||||||
Other | 0.3 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Large-Cap Value | 34.7 | ||||||
Large-Cap Growth | 28.3 | ||||||
Mid-Cap Growth | 14.4 | ||||||
Mid-Cap Value | 14.0 | ||||||
Small-Cap Growth | 7.6 | ||||||
Small-Cap Value | 1.0 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
PetroChina Co. Ltd. ADR | 6.2 | ||||||
China Mobile Ltd. ADR | 6.1 | ||||||
Baidu.com ADR | 5.8 | ||||||
China Petroleum and Chemical Corp. ADR | 4.8 | ||||||
China Life Insurance Co. Ltd. ADR | 4.8 | ||||||
CNOOC Ltd. ADR | 4.7 | ||||||
Huaneng Power International, Inc. ADR | 4.6 | ||||||
Yanzhou Coal Mining Co. Ltd. ADR | 4.4 | ||||||
China Netcom Group Corp. Ltd. ADR | 4.3 | ||||||
Aluminum Corp. of China Ltd. ADR | 4.2 | ||||||
Total | 49.9 |
12
Manager's Analysis (Continued)
PowerShares Golden Dragon Halter USX China Portfolio (ticker: PGJ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||||||
1 Year | 3 Year | Avg. Ann.† | Cumulative | ||||||||||||||||
Halter USX China IndexSM | 37.08 | 33.30 | 24.50 | 110.67 | |||||||||||||||
MSCI EAFE Index | -1.78 | 16.25 | 15.09 | 61.25 | |||||||||||||||
S&P 500® Index | -4.68 | 8.23 | 6.56 | 24.13 |
Fund
NAV Return | 35.87 | 31.94 | 23.63 | 105.21 | |||||||||||||||
Share Price Return | 35.60 | 31.91 | 23.44 | 104.29 |
Fund Inception: 9 December 2004
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.73%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.69% while the Fund's gross total operating expense ratio was 0.66%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The MSCI EAFE Index and S&P 500® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 1,137 and 500 common stocks, respectively.
† Average annualized.
13
Manager's Analysis
PowerShares Listed Private Equity Portfolio (ticker: PSP)
The PowerShares Listed Private Equity Portfolio seeks investment results that generally correspond to the Red Rocks Listed Private Equity Index. The Index provides investors with a means of diversified exposure to private equity firms and their underlying portfolio investments. The private equity asset class has historically provided strong, non-correlated performance to other traditional asset classes.
Over the year ended April 30, 2008 the Fund lost 23.50% while the S&P 500 was down 4.68%. After four years of strong global economic growth, the U.S. sub-prime mortgage crisis emerged in the summer of 2007. Debt and equity markets around the world have experienced weakness and volatility over the past year as major flaws in global financial markets became evident.
The primary impact to the private equity industry has been felt in the large leveraged buyout ("LBO") market in Europe and the United States. Global deleveraging has also led to fewer exit opportunities for private equity firms. The overriding opinion of private equity is currently negative when in fact the industry is actually quite strong. According to Private Equity Intelligence, global private equity fundraising increased in 2007 from 2006 to over $850 billion.
The outlook for listed private equity companies remains favorable where the majority of investments are in the middle market where transactions are still thriving, pricing multiples are steady and financing is still available. Also, many companies in the listed private equity universe took advantage of the strong exit markets over the past couple years. The cash raised is currently being deployed under better terms which will likely lead to continued strong realizations in the future.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Investment Companies | 48.7 | ||||||
Diversified Financial Services | 14.5 | ||||||
Holding Companies-Diversified | 13.3 | ||||||
REITS | 6.2 | ||||||
Internet | 5.6 | ||||||
Banks | 5.0 | ||||||
Commercial Services | 4.6 | ||||||
Closed-end Funds | 1.2 | ||||||
Money Market Fund | 0.3 | ||||||
Other | 0.6 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Small-Cap Value | 40.4 | ||||||
Mid-Cap Growth | 27.5 | ||||||
Mid-Cap Value | 23.1 | ||||||
Small-Cap Growth | 9.0 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Leucadia National Corp. | 11.5 | ||||||
Fortress Investment Group LLC, Class A | 10.2 | ||||||
American Capital Strategies Ltd. | 8.3 | ||||||
Allied Capital Corp. | 6.4 | ||||||
CapitalSource, Inc. | 6.2 | ||||||
SVB Financial Group | 5.1 | ||||||
Apollo Investment Corp. | 4.6 | ||||||
Macquarie Infrastructure Co. LLC | 4.6 | ||||||
KKR Financial Holdings LLC | 4.5 | ||||||
Ares Capital Corp. | 3.7 | ||||||
Total | 65.1 |
14
Manager's Analysis (Continued)
PowerShares Listed Private Equity Portfolio (ticker: PSP)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Red Rocks Listed Private Equity Index | -23.50 | -9.62 | -14.27 | ||||||||||||
S&P 500 Pure Growth Index | -3.17 | 3.38 | 5.19 | ||||||||||||
Russell 2000® Index | -10.96 | -2.82 | -4.27 |
Fund
NAV Return | -23.50 | -9.60 | -14.17 | ||||||||||||
Share Price Return | -24.43 | -10.33 | -15.25 |
Fund Inception: 24 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.91%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.71% while the Fund's gross total operating expense ratio was 0.72%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500 Pure Growth Index and Russell 2000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 154 and 2,000 common stocks, respectively.
† Average annualized.
15
Manager's Analysis
PowerShares Lux Nanotech Portfolio (ticker: PXN)
The PowerShares Lux Nanotech Portfolio seeks to replicate, before fees and expenses, the Lux Nanotech IndexTM which is designed to identify a group of companies involved in developing, manufacturing and funding nanotechnology applications. Companies may be involved in one or more stages of Lux's Nanotechnology Value Chain frameworks: Nanomaterials, Nanointermediates, Nano-enabled Products and Nanotools.
For the year ended April 30, 2008 the PowerShares Lux Nanotech Portfolio returned -19.51% underperforming the S&P 500® Index, which returned -4.68%.
The negative performance of the Fund was largely attributable to the poor performance of the following securities: Arrowhead Research Corp., Flamel Technologies S.A., Nanosphere Inc., Immunicon Corp., Nanophase Technologies Corp. and FEI Co. Together, these securities provided 61.00% of the Funds negative performance, relative to the broader US equity market. Conversely, the following securities contributed positively to the Fund: Cambridge Display Tech Inc., Elan Corp. PLC, Abraxis BioScience Inc. and NVE Corp. Lastly, the negative performance of the Fund was mostly attributable to overallocation in small-cap growth companies such as Flamel Technologies S.A. Conversely, most of the positive performance of the fund was attributable to stock selection within mid-cap growth companies such as Elan Corp. PLC.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Commercial Services | 12.2 | ||||||
Chemicals | 11.9 | ||||||
Pharmaceuticals | 11.8 | ||||||
Electronics | 11.6 | ||||||
Miscellaneous Manufacturing | 10.6 | ||||||
Semiconductors | 8.9 | ||||||
Biotechnology | 8.6 | ||||||
Computers | 6.5 | ||||||
Software | 5.3 | ||||||
Investment Companies | 4.6 | ||||||
Energy-Alternate Sources | 4.3 | ||||||
Auto Manufacturers | 3.2 | ||||||
Other | 0.5 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Small-Cap Growth | 63.2 | ||||||
Large-Cap Value | 16.0 | ||||||
Large-Cap Growth | 9.9 | ||||||
Mid-Cap Growth | 6.5 | ||||||
Small-Cap Value | 4.4 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Elan Corp. PLC ADR (Ireland) | 6.4 | ||||||
NVE Corp. | 6.3 | ||||||
Veeco Instruments, Inc. | 5.6 | ||||||
Flamel Technologies ADR (France) | 5.3 | ||||||
Accelrys, Inc. | 5.3 | ||||||
FEI Co. | 5.3 | ||||||
Biosante Pharmaceuticals, Inc. | 5.3 | ||||||
Symyx Technologies, Inc. | 5.1 | ||||||
Harris & Harris Group, Inc. | 4.6 | ||||||
Nanophase Technologies Corp. | 4.6 | ||||||
Total | 53.8 |
16
Manager's Analysis (Continued)
PowerShares Lux Nanotech Portfolio (ticker: PXN)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Lux Nanotech IndexTM | -19.06 | -3.89 | -9.52 | ||||||||||||
S&P 500® Index | -4.68 | 8.23 | 22.04 |
Fund
NAV Return | -19.51 | -3.15 | -7.72 | ||||||||||||
Share Price Return | -20.16 | -3.30 | -8.08 |
Fund Inception: 26 October 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.77%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.70% while the Fund's gross total operating expense ratio was 0.73%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index is an unmanaged index used as a measurement of change in stock market conditions based on the average performance of approximately 500 common stocks.
† Average annualized.
17
Manager's Analysis
PowerShares S&P 500 BuyWrite Portfolio (ticker: PBP)
The PowerShares S&P 500 BuyWrite Portfolio is based on the CBOE S&P 500 BuyWrite Index and seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that Index. The Index measures the total returns of a theoretical portfolio of S&P 500® Index stocks combined with S&P 500® Index call options which are systematically written (sold) against the portfolio through a "buy-write" strategy. The Index also reinvests the dividends and options premium received by the portfolio back into the component stocks as part of its total return strategy.
For the December 20, 2007 (PBP launch date) through April 30, 2008 period, the Fund was -0.19% on a total return basis. The CBOE S&P 500 BuyWrite Index was -0.73% while the S&P 500® Index was -4.45% over this same timeframe. A majority of the fund's outperformance versus the BuyWrite Index can be attributed to the one-day deferral (due to expiration) of the initial options sold against the portfolio.
U.S. large-cap stocks fared poorly during the reporting period based on a variety of factors including the U.S. credit crunch, a plunging dollar, a sharp rise in commodity prices, and the decelerating growth of the U.S. economy. At the same time, S&P 500® volatility, as measured by the CBOE "VIX" index, was significantly higher than historical averages. Although the equity market selloff was detrimental to the S&P 500® stock portfolio of PBP, higher volatility resulted in greater options premium generated for the Fund which helped mitigate the overall negative Fund return.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 17.4 | ||||||
Information Technology | 16.3 | ||||||
Energy | 14.3 | ||||||
Industrials | 12.0 | ||||||
Health Care | 11.5 | ||||||
Consumer Staples | 10.7 | ||||||
Consumer Discretionary | 8.7 | ||||||
Utilities | 3.7 | ||||||
Materials | 3.6 | ||||||
Telecommunication Services | 3.5 | ||||||
Money Market Fund | 0.1 | ||||||
Other | (1.8 | ) |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Large-Cap Value | 50.4 | ||||||
Large-Cap Growth | 37.7 | ||||||
Mid-Cap Value | 6.5 | ||||||
Mid-Cap Growth | 5.2 | ||||||
Small-Cap Growth | 0.1 | ||||||
Small-Cap Value | 0.1 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Exxon Mobil Corp. | 4.2 | ||||||
General Electric Co. | 2.7 | ||||||
AT&T, Inc. | 2.0 | ||||||
Microsoft Corp. | 1.9 | ||||||
Procter & Gamble (The) Co. | 1.7 | ||||||
Chevron Corp. | 1.7 | ||||||
Johnson & Johnson | 1.6 | ||||||
International Business Machines Corp. | 1.4 | ||||||
Bank of America Corp. | 1.4 | ||||||
JPMorgan Chase & Co. | 1.4 | ||||||
Total | 20.0 |
18
Manager's Analysis (Continued)
PowerShares S&P 500 BuyWrite Portfolio (ticker: PBP)
Fund Performance History (%) As of 30 April 2008
Index
Fund Inception Cumulative | |||||||
CBOE S&P 500 BuyWrite Index | -0.73 | ||||||
S&P 500® Index | -4.45 |
Fund
NAV Return | -0.19 | ||||||
Share Price Return | -1.94 |
Fund Inception: 20 December 2007
Performance data quoted represents past performance. Past performance is not a guarantee of future results, current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. According to the Fund's current prospectus, the expense ratio of 0.75% is expressed as a unitary fee to cover operating expenses and expenses incurred in connection with managing the portfolio. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The index performance results are hypothetical. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index is an unmanaged index used as a measurement of change in stock market conditions based on the average performance of approximately 500 common stocks.
19
Manager's Analysis
PowerShares Value Line Industry Rotation Portfolio (ticker: PYH)
The PowerShares Value Line Industry Rotation Portfolio is based on the Value Line Industry Rotation Index. The Index is comprised of 75 stocks chosen based on both their TimelinessTM rank and their industry TimelinessTM rank. The Index is designed to first rank all industries represented in the Value Line universe by their industry TimelinessTM. The Index then selects the highest ranked stock for TimelinessTM from each of the 50 highest TimelinessTM-rated industries, as well as the second highest TimelinessTM-ranked stock from each of the 25 highest rated industries. The Index is reconstituted and rebalanced quarterly using the same methodology as described above.
For the year ended April 30, 2008 the PowerShares Value Line Industry Rotation Portfolio returned -0.45%, outperforming the S&P 500® Index, which returned -4.68%.
For the year ended April 30, 2008, five of the ten sectors represented in the Fund generated positive returns. Stock selection in the financials, industrials and consumer discretionary sectors made the largest positive contributions to the performance of the Fund relative to the broader US equity market. Conversely, stock selection within the information technology and consumer staples sectors and overexposure in the energy sector partially offset the positive performance of the Fund. Overallocation within mid-cap growth companies was the largest positive contributor to the Fund's performance. Conversely, overallocation in small-cap value companies partially offset the positive performance of the Fund.
20
Manager's Analysis (Continued)
PowerShares Value Line Industry Rotation Portfolio (ticker: PYH)
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Oil & Gas | 7.2 | ||||||
Pharmaceuticals | 5.6 | ||||||
Chemicals | 5.2 | ||||||
Software | 5.1 | ||||||
Internet | 4.3 | ||||||
Electronics | 4.2 | ||||||
Commercial Services | 4.1 | ||||||
Metal Fabricate/Hardware | 3.9 | ||||||
Computers | 3.8 | ||||||
Insurance | 3.8 | ||||||
Beverages | 3.7 | ||||||
Machinery-Diversified | 3.0 | ||||||
Transportation | 3.0 | ||||||
Engineering & Construction | 2.8 | ||||||
Gas | 2.8 | ||||||
Food | 2.7 | ||||||
Oil & Gas Services | 2.7 | ||||||
Environmental Control | 2.6 | ||||||
Home Furnishings | 2.6 | ||||||
Telecommunications | 2.5 | ||||||
Healthcare-Products | 2.4 | ||||||
Healthcare-Services | 2.3 | ||||||
Semiconductors | 2.3 | ||||||
Biotechnology | 2.2 | ||||||
Mining | 2.1 | ||||||
Distribution/Wholesale | 1.5 | ||||||
Machinery-Construction & Mining | 1.5 | ||||||
Agriculture | 1.4 | ||||||
Coal | 1.4 | ||||||
Aerospace/Defense | 1.3 | ||||||
Closed-end Funds | 1.3 | ||||||
Electric | 1.3 | ||||||
Diversified Financial Services | 1.2 | ||||||
Packaging & Containers | 1.2 | ||||||
Media | 1.0 | ||||||
Money Market Fund | 0.1 | ||||||
Other | (0.1 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Millennium Pharmaceuticals, Inc. | 2.2 | ||||||
Lindsay Corp. | 1.8 | ||||||
Southwestern Energy Co. | 1.6 | ||||||
DeVry, Inc. | 1.6 | ||||||
eResearch Technology, Inc. | 1.6 | ||||||
CSX Corp. | 1.6 | ||||||
Bucyrus International, Inc. Class A | 1.6 | ||||||
LKQ Corp. | 1.5 | ||||||
Valmont Industries, Inc. | 1.5 | ||||||
Apache Corp. | 1.5 | ||||||
Total | 16.5 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Mid-Cap Growth | 34.7 | ||||||
Large-Cap Growth | 29.9 | ||||||
Small-Cap Growth | 14.8 | ||||||
Mid-Cap Value | 7.6 | ||||||
Large-Cap Value | 6.5 | ||||||
Small-Cap Value | 6.5 |
21
Manager's Analysis (Continued)
PowerShares Value Line Industry Rotation Portfolio (ticker: PYH)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Value Line Industry Rotation Index | -0.46 | 7.53 | 10.82 | ||||||||||||
S&P 500® Index | -4.68 | 1.32 | 1.87 | ||||||||||||
Russell 2000® Index | -10.96 | -4.78 | -6.70 |
Fund
NAV Return | -0.45 | 7.58 | 10.86 | ||||||||||||
Share Price Return | -0.52 | 7.51 | 10.78 |
Fund Inception: 1 December 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.58%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.73% while the Fund's gross total operating expense ratio was 0.95%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index and Russell 2000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 500 and 2,000 common stocks, respectively.
† Average annualized.
22
This page intentionally left blank
Manager's Analysis
PowerShares Value Line TimelinessTM Select Portfolio (ticker: PIV)
The PowerShares Value Line TimelinessTM Select Portfolio seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the Value Line TimelinessTM Select Index. The Value Line Index is comprised of the 50 domestic stocks with the greatest capital appreciation potential as identified by the Value Line Timeliness Select Methodology. The Value Line Index seeks to provide market out-performance and reduce risk by incorporating Value Line's Safety Ranking into the investment process.
The objective of the Value Line Index is to represent a group of U.S. common stocks that have the potential to outperform the U.S. equity market. Stocks are selected using a proprietary rules-based discipline, which selects stocks with the greatest potential for capital appreciation based on the three core Value Line Ranking Systems.
The Value Line Index contains the 50 highest cumulative ranked stocks for SafetyTM and TechnicalsTM chosen from the 100 number one ranked stocks for TimelinessTM. The Value Line Index removes stocks from the Value Line Index if they are no longer ranked number one for TimelinessTM and replaces removed stocks using the same methodology as described above.
For the year ended April 30, 2008 the PowerShares Value Line TimelinessTM Select Portfolio returned -4.72%, slightly underperforming the S&P 500® Index, which returned -4.68%.
For the year ended April 30, 2008 six of the ten sectors represented in the Fund generated positive returns. Stock selection in the financials and consumer discretionary sectors and overallocation in materials made the largest positive contributions to the performance of the Fund relative to the broader US equity market. Conversely, stock selection within the information technology, consumer staples and industrial sectors partially offset the positive performance of the Fund. Lastly, underallocation within large-cap growth companies was the largest contributor to the Fund's positive performance. Conversely, overallocation in small-cap growth companies partially offset the positive returns of the Fund, relative to the broader US equity market.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Information Technology | 32.0 | ||||||
Industrials | 13.8 | ||||||
Materials | 11.8 | ||||||
Energy | 10.9 | ||||||
Consumer Discretionary | 10.6 | ||||||
Health Care | 7.6 | ||||||
Financials | 5.8 | ||||||
Consumer Staples | 3.7 | ||||||
Utilities | 2.0 | ||||||
Telecommunication Services | 1.9 | ||||||
Other | (0.1 | ) |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Large-Cap Growth | 41.0 | ||||||
Mid-Cap Growth | 34.4 | ||||||
Small-Cap Growth | 15.5 | ||||||
Large-Cap Value | 6.0 | ||||||
Mid-Cap Value | 1.7 | ||||||
Small-Cap Value | 1.4 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Lindsay Corp. | 2.9 | ||||||
Apple, Inc. | 2.8 | ||||||
Southwestern Energy Co. | 2.4 | ||||||
Amphenol Corp., Class A | 2.3 | ||||||
GameStop Corp., Class A | 2.3 | ||||||
Google, Inc., Class A | 2.3 | ||||||
Weatherford International Ltd. | 2.3 | ||||||
Perrigo Co. | 2.2 | ||||||
Murphy Oil Corp. | 2.2 | ||||||
Potash Corp. of Saskatchewan (Canada) | 2.2 | ||||||
Total | 23.9 |
24
Manager's Analysis (Continued)
PowerShares Value Line TimelinessTM Select Portfolio (ticker: PIV)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Value Line TimelinessTM Select Index | -4.57 | 3.15 | 7.76 | ||||||||||||
S&P 500® Index | -4.68 | 5.87 | 14.73 | ||||||||||||
Russell 2000® Index | -10.96 | 2.95 | 7.24 |
Fund
NAV Return | -4.72 | 3.26 | 7.99 | ||||||||||||
Share Price Return | -4.75 | 3.04 | 7.44 |
Fund Inception: 6 December 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.73%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.70% while the Fund's gross total operating expense ratio was 0.70%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index and Russell 2000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 500 and 2,000 common stocks, respectively.
† Average annualized.
25
Manager's Analysis
PowerShares Water Resources Portfolio (ticker: PHO)
The Fund seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of the equity index, the Palisades Water Index. The Palisades Water Index includes U.S. exchange traded companies drawn from the following water sectors: water utilities, treatment, analytical, infrastructure, water resource management, and multi-business. The underlying strength is derived from the burgeoning demands on the global water industry, including population growth and urbanization, advanced treatment of contaminants, regulatory mandates, needed water infrastructure and institutional constraints.
In a particularly turbulent year, the PowerShares Water Resources Portfolio achieved relative out-performance over the period April 30, 2007 to April 30, 2008. PHO gained 8.02% while the major U.S. averages were negative. The NASDAQ Composite fell -3.67% and the S&P 500® lost -4.68%.
The positive performance of PHO relative to the U.S. market averages is a confluence of factors over the period. Early in the period while the U.S. economy was perceived to be slowing, many portfolio components benefited from the contribution from foreign revenues. The mid term dynamics focused on the global spread of economic weakness as international indexes were hard hit. Since PHO is focused on U.S. securities, this proved to be an asset class advantage. The last several months have seen a broad-based improvement. Over the reporting period, Lindsay Corp, Valmont Industries, and Badger Meter were the top contributors to the Fund's performance. Watts Water and Mueller Water were the greatest drags on Fund performance.
In the long term, the positive fundamentals of the water industry remain strong. The increasing value of water derives from the adjustment of a growing global population to the links between human health, economic development and resource sustainability. This is a theme that is increasingly recognized within the investment community.
This Fund has experienced some performance variation from the Index due to rebalance trading that occurred over several days and ownership issues which do not allow the Fund to fully replicate the Index.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Miscellaneous Manufacturing | 21.8 | ||||||
Engineering & Construction | 15.0 | ||||||
Electronics | 13.4 | ||||||
Machinery-Diversified | 12.6 | ||||||
Water | 11.1 | ||||||
Environmental Control | 9.8 | ||||||
Metal Fabricate/Hardware | 7.3 | ||||||
Electrical Components & Equipment | 3.0 | ||||||
Hand/Machine Tools | 2.9 | ||||||
Biotechnology | 2.8 | ||||||
Money Market Fund | 0.0 | ||||||
Other | 0.3 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Mid-Cap Growth | 37.1 | ||||||
Small-Cap Growth | 20.9 | ||||||
Large-Cap Growth | 18.4 | ||||||
Small-Cap Value | 16.7 | ||||||
Mid-Cap Value | 4.3 | ||||||
Large-Cap Value | 2.6 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
URS Corp. | 5.1 | ||||||
Valmont Industries, Inc. | 4.8 | ||||||
Aecom Technology Corp. | 4.7 | ||||||
Tetra Tech, Inc. | 4.6 | ||||||
Veolia Environnement ADR (France) | 4.3 | ||||||
Lindsay Corp. | 4.1 | ||||||
Danaher Corp. | 4.0 | ||||||
Agilent Technologies, Inc. | 3.9 | ||||||
Itron, Inc. | 3.9 | ||||||
ITT Corp. | 3.3 | ||||||
Total | 42.7 |
26
Manager's Analysis (Continued)
PowerShares Water Resources Portfolio (ticker: PHO)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Palisades Water Index | 12.57 | 16.29 | 43.80 | ||||||||||||
S&P 500® Index | -4.68 | 5.87 | 14.73 | ||||||||||||
Dow Jones Utility Index | -1.68 | 10.20 | 26.35 |
Fund
NAV Return | 8.02 | 14.04 | 37.02 | ||||||||||||
Share Price Return | 7.55 | 13.31 | 34.98 |
Fund Inception: 6 December 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.68%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.64% while the Fund's gross total operating expense ratio was 0.63%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P 500® Index and Dow Jones Utility Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 500 and 15 common stocks, respectively.
† Average annualized.
27
Manager's Analysis
PowerShares WilderHill Clean Energy Portfolio (ticker: PBW)
The PowerShares WilderHill Clean Energy Portfolio is based on the WilderHill Clean Energy Index and it seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
Over the past twelve months the Fund returned 8.55%, although with significantly greater volatility than the small change implies. This period commenced in Spring 2007 and initially it saw a continuation of an upward trend. For the first eight months there was sizeable upward movement broken twice by significant, albeit brief downturns; each of those two downturns, however were soon followed by new highs. The third downturn was by far the largest beginning at the start of 2008, and has persisted though the end of this period.
The solar sector in particular contributed to that initial upward movement; similarly its robust downturn in 2008 was a key driver for strong downward performance. Solar having run up high P/E ratios and rich valuations regressed to the mean. Biofuels remained out of favor over much of this period and hence were not able to offset the downturn in solar. Energy efficiency and wind power however have seen some strengthening.
This Fund has experienced some performance variation from the Index due to rebalance trading that occurred over several days and ownership issues which do not allow the Fund to fully replicate the Index.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Energy-Alternate Sources | 40.5 | ||||||
Semiconductors | 15.1 | ||||||
Electrical Components & Equipment | 12.4 | ||||||
Electric | 11.1 | ||||||
Chemicals | 7.6 | ||||||
Computers | 3.7 | ||||||
Auto Parts & Equipment | 3.2 | ||||||
Electronics | 2.6 | ||||||
Food | 2.4 | ||||||
Machinery-Diversified | 1.2 | ||||||
Other | 0.2 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Small-Cap Growth | 52.4 | ||||||
Large-Cap Growth | 15.9 | ||||||
Mid-Cap Growth | 14.9 | ||||||
Small-Cap Value | 9.8 | ||||||
Large-Cap Value | 4.1 | ||||||
Mid-Cap Value | 2.9 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Trina Solar Ltd. ADR (Cayman Islands) | 4.0 | ||||||
JA Solar Holdings Co. Ltd. ADR (China) | 4.0 | ||||||
First Solar, Inc. | 3.9 | ||||||
Yingli Green Energy Holding Co. Ltd. ADR (China) | 3.7 | ||||||
SunPower Corp., Class A | 3.5 | ||||||
Suntech Power Holdings Co. Ltd. ADR (China) | 3.5 | ||||||
Ormat Technologies, Inc. | 3.5 | ||||||
Evergreen Solar, Inc. | 3.0 | ||||||
Zoltek Cos., Inc. | 3.0 | ||||||
Energy Conversion Devices, Inc. | 2.8 | ||||||
Total | 34.9 |
28
Manager's Analysis (Continued)
PowerShares WilderHill Clean Energy Portfolio (ticker: PBW)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
WilderHill Clean Energy Index | 7.39 | 8.77 | 30.52 | ||||||||||||
NASDAQ Composite Index | -4.45 | 5.14 | 17.22 | ||||||||||||
S&P 500® Index | -4.68 | 6.32 | 21.44 |
Fund
NAV Return | 8.55 | 9.84 | 34.50 | ||||||||||||
Share Price Return | 8.44 | 9.86 | 34.62 |
Fund Inception: 3 March 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.70%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.67% while the Fund's gross total operating expense ratio was 0.67%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The NASDAQ Composite Index and S&P 500® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 3,087 and 500 common stocks, respectively.
† Average annualized.
29
Manager's Analysis
PowerShares WilderHill Progressive Energy Portfolio (ticker: PUW)
The PowerShares WilderHill Progressive Energy Portfolio is based on the WilderHill Progressive Energy Index and it seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
Over the past twelve months ended April 30, 2008, the Fund declined 0.96%, although there has been significantly more volatility over the period than this change implies. Prior to this reporting period a run-up in valuations had begun, and it continued, reaching a peak in Summer 2007. The latter half of 2007 then saw mainly sideways movement with the inflection point a strong downturn that commenced almost exactly at the start of 2008. After reaching a bottom in the first quarter of 2008, the Fund moved to a rebound and ended the period almost where it was 12 months prior.
In contrast to a prior period when greater attention was paid to possible carbon regulations and climate risk, that outlook was changed somewhat early in this latest period. Likewise there were moderate declines in uranium stocks, in 'clean-coal', some natural gas utilization, energy efficiency, and pollution control technologies.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Oil & Gas | 16.8 | ||||||
Electric | 10.5 | ||||||
Chemicals | 8.5 | ||||||
Energy-Alternate Sources | 8.4 | ||||||
Electrical Components & Equipment | 8.0 | ||||||
Auto Parts & Equipment | 7.6 | ||||||
Miscellaneous Manufacturing | 7.6 | ||||||
Mining | 7.3 | ||||||
Environmental Control | 6.6 | ||||||
Electronics | 6.2 | ||||||
Agriculture | 3.2 | ||||||
Hand/Machine Tools | 3.0 | ||||||
Telecommunications | 3.0 | ||||||
Aerospace/Defense | 2.4 | ||||||
Investment Companies | 0.5 | ||||||
Semiconductors | 0.4 | ||||||
Money Market Fund | 0.1 | ||||||
Other | (0.1 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Southwestern Energy Co. | 3.9 | ||||||
USEC, Inc. | 3.7 | ||||||
Fuel Tech, Inc. | 3.4 | ||||||
Chesapeake Energy Corp. | 3.4 | ||||||
Questar Corp. | 3.4 | ||||||
CPFL Energia S.A. ADR (Brazil) | 3.3 | ||||||
Range Resources Corp. | 3.2 | ||||||
Anderson (The), Inc. | 3.2 | ||||||
Cameco Corp. (Canada) | 3.2 | ||||||
Sociedad Quimica y Minera de Chile S.A. ADR (Chile) | 3.2 | ||||||
Total | 33.9 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Large-Cap Growth | 23.1 | ||||||
Small-Cap Value | 20.3 | ||||||
Mid-Cap Growth | 19.9 | ||||||
Small-Cap Growth | 16.1 | ||||||
Large-Cap Value | 14.6 | ||||||
Mid-Cap Value | 6.0 |
30
Manager's Analysis (Continued)
PowerShares WilderHill Progressive Energy Portfolio (ticker: PUW)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
WilderHill Progressive Energy Index | -1.26 | 9.13 | 14.23 | ||||||||||||
NASDAQ Composite Index | -4.45 | 1.89 | 2.90 | ||||||||||||
S&P 500® Index | -4.68 | 2.34 | 3.58 |
Fund
NAV Return | -0.96 | 8.98 | 13.91 | ||||||||||||
Share Price Return | -1.14 | 8.89 | 13.80 |
Fund Inception: 24 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.35%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.73% while the Fund's gross total operating expense ratio was 0.88%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The NASDAQ Composite Index and S&P 500® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 3,087 and 500 common stocks, respectively.
† Average annualized.
31
Funds' Distribution History
Ex-Dividend | 3/25/08 | 3/20/08 | 12/21/07 | 9/21/07 | 6/15/07 | 3/16/07 | |||||||||||||||||||||||||
Record | 3/27/08 | 3/25/08 | 12/26/07 | 9/25/07 | 6/19/07 | 3/20/07 | |||||||||||||||||||||||||
Payable | 3/31/08 | 3/31/08 | 12/31/07 | 9/28/07 | 6/29/07 | 3/30/07 | |||||||||||||||||||||||||
Fund | Ticker | ||||||||||||||||||||||||||||||
PowerShares Aerospace & Defense Portfolio | PPA | — | — | 0.01399 | 0.01038 | 0.01862 | 0.01223 | ||||||||||||||||||||||||
PowerShares CleantechTM Portfolio | PZD | — | — | — | — | — | — | ||||||||||||||||||||||||
PowerShares DWA Technical LeadersTM Portfolio | PDP | — | — | — | 0.02466 | — | — | ||||||||||||||||||||||||
PowerShares Golden Dragon Halter USX China Portfolio | PGJ | — | — | — | 0.04904 | 0.16303 | — | ||||||||||||||||||||||||
PowerShares Listed Private Equity Portfolio | PSP | — | 0.23844 | 0.54101 | 0.11266 | 0.21792 | 0.07235 | ||||||||||||||||||||||||
PowerShares Lux Nanotech Portfolio | PXN | — | — | — | — | — | — | ||||||||||||||||||||||||
PowerShares S&P 500 BuyWrite Portfolio | PBP | 0.05250 | — | — | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Value Line Industry Rotation Portfolio | PYH | — | — | — | 0.01475 | — | — | ||||||||||||||||||||||||
PowerShares Value Line TimelinessTM Select Portfolio | PIV | — | — | — | — | — | — | ||||||||||||||||||||||||
PowerShares Water Resources Portfolio | PHO | — | 0.01822 | 0.01763 | 0.01328 | 0.03052 | 0.02358 | ||||||||||||||||||||||||
PowerShares WilderHill Clean Energy Portfolio | PBW | — | — | — | — | — | — | ||||||||||||||||||||||||
PowerShares WilderHill Progressive Energy Portfolio | PUW | — | 0.01258 | 0.03609 | 0.02001 | 0.06309 | 0.01250 |
32
12/15/06 | 9/15/06 | 6/16/06 | 12/30/05 | 12/16/05 | 9/16/05 | 6/17/05 | |||||||||||||||||||||||||
12/19/06 | 9/16/06 | 6/20/06 | 1/4/06 | 12/20/05 | 9/20/05 | 6/21/05 | |||||||||||||||||||||||||
12/29/06 | 9/29/06 | 6/30/06 | 1/31/06 | 12/30/05 | 9/30/05 | 6/30/05 | |||||||||||||||||||||||||
Fund | |||||||||||||||||||||||||||||||
PowerShares Aerospace & Defense Portfolio | 0.00968 | 0.02002 | 0.02120 | — | 0.02191 | NA | NA | ||||||||||||||||||||||||
PowerShares CleantechTM Portfolio | — | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares DWA Technical LeadersTM Portfolio | NA | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Golden Dragon Halter USX China Portfolio | 0.00598 | 0.08011 | 0.12430 | — | 0.00132 | 0.11161 | 0.04962 | ||||||||||||||||||||||||
PowerShares Listed Private Equity Portfolio | 0.26528 | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Lux Nanotech Portfolio | — | — | — | 0.06725 | 0.01063 | NA | NA | ||||||||||||||||||||||||
PowerShares S&P 500 BuyWrite Portfolio | NA | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Value Line Industry Rotation Portfolio | 0.01016 | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||||||
PowerShares Value Line TimelinessTM Select Portfolio | — | — | — | — | — | NA | NA | ||||||||||||||||||||||||
PowerShares Water Resources Portfolio | 0.07779 | 0.03621 | 0.03737 | 0.02682 | 0.00627 | NA | NA | ||||||||||||||||||||||||
PowerShares WilderHill Clean Energy Portfolio | 0.03675 | — | 0.01037 | — | — | — | — | ||||||||||||||||||||||||
PowerShares WilderHill Progressive Energy Portfolio | 0.00451 | NA | NA | NA | NA | NA | NA |
33
Frequency Distribution of Discounts & Premiums
Since Inception through April 30, 2008
Closing Price Above NAV (bps) | |||||||||||||||||||||||||||||||||||||||
Ticker | Fund Name | Inception | Days | 0-24 | 25-49 | 50-99 | 100-149 | 150-199 | 200+ | ||||||||||||||||||||||||||||||
PPA | PowerShares Aerospace & Defense Portfolio | 10/26/05 | 631 | 304 | 10 | 2 | — | — | — | ||||||||||||||||||||||||||||||
PZD | PowerShares CleantechTM Portfolio | 10/24/06 | 381 | 128 | 12 | 8 | — | — | — | ||||||||||||||||||||||||||||||
PDP | PowerShares DWA Technical LeadersTM Portfolio | 3/1/07 | 295 | 148 | 5 | 3 | — | — | — | ||||||||||||||||||||||||||||||
PGJ | PowerShares Golden Dragon Halter USX China Portfolio | 12/9/04 | 853 | 413 | 101 | 19 | — | — | — | ||||||||||||||||||||||||||||||
PSP | PowerShares Listed Private Equity Portfolio | 10/24/06 | 381 | 180 | 8 | 0 | — | — | — | ||||||||||||||||||||||||||||||
PXN | PowerShares Lux Nanotech Portfolio | 10/26/05 | 631 | 259 | 41 | 14 | 5 | 1 | — | ||||||||||||||||||||||||||||||
PBP | PowerShares S&P 500 BuyWrite Portfolio | 12/20/07 | 89 | 38 | 11 | 10 | — | 1 | — | ||||||||||||||||||||||||||||||
PYH | PowerShares Value Line Industry Rotation Portfolio | 12/1/06 | 354 | 149 | 4 | 1 | — | — | — | ||||||||||||||||||||||||||||||
PIV | PowerShares Value Line TimelinessTM Select Portfolio | 12/6/05 | 603 | 278 | 20 | 3 | — | — | — | ||||||||||||||||||||||||||||||
PHO | PowerShares Water Resources Portfolio | 12/6/05 | 603 | 305 | 83 | 14 | 1 | — | — | ||||||||||||||||||||||||||||||
PBW | PowerShares WilderHill Clean Energy Portfolio | 3/3/05 | 796 | 383 | 87 | 11 | 2 | — | — | ||||||||||||||||||||||||||||||
PUW | PowerShares WilderHill Progressive Energy Portfolio | 10/24/06 | 381 | 142 | 13 | 4 | — | — | — |
34
Closing Price Below NAV (bps) | |||||||||||||||||||||||||||
Ticker | -0-24 | -25-49 | -50-99 | -100-149 | -150-199 | -200+ | |||||||||||||||||||||
PPA | 312 | 3 | — | — | — | — | |||||||||||||||||||||
PZD | 227 | 6 | — | — | — | — | |||||||||||||||||||||
PDP | 138 | — | 1 | — | — | — | |||||||||||||||||||||
PGJ | 290 | 25 | 5 | — | — | — | |||||||||||||||||||||
PSP | 185 | 7 | 1 | — | — | — | |||||||||||||||||||||
PXN | 281 | 25 | 3 | — | 1 | 1 | |||||||||||||||||||||
PBP | 22 | 5 | 2 | — | — | — | |||||||||||||||||||||
PYH | 197 | 3 | — | — | — | — | |||||||||||||||||||||
PIV | 299 | 3 | — | — | — | — | |||||||||||||||||||||
PHO | 190 | 8 | 1 | 1 | — | — | |||||||||||||||||||||
PBW | 282 | 30 | 1 | — | — | — | |||||||||||||||||||||
PUW | 218 | 4 | — | — | — | — |
35
Fees and Expenses
As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, you incur Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month period (or shorter) ended April 30, 2008.
Actual Expenses
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, 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 first line under the heading "Expenses Paid During the Six-Month Period" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds' actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Funds' 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 Funds 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 tables are meant to highlight your ongoing costs only, and do not reflect any transactional costs such as sales charges (loads). Therefore the second line in the table 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 transactional costs were included, your costs would have been higher.
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Aerospace & Defense Portfolio Actual | $ | 1,000.00 | $ | 875.90 | 0.66 | % | $ | 3.08 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.58 | 0.66 | % | $ | 3.32 | |||||||||||
PowerShares CleantechTM Portfolio Actual | $ | 1,000.00 | $ | 977.32 | 0.67 | % | $ | 3.29 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.53 | 0.67 | % | $ | 3.37 | |||||||||||
PowerShares DWA Technical LeadersTM Portfolio Actual | $ | 1,000.00 | $ | 935.18 | 0.71 | % | $ | 3.42 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.33 | 0.71 | % | $ | 3.57 | |||||||||||
PowerShares Golden Dragon Halter USX China Portfolio Actual | $ | 1,000.00 | $ | 745.85 | 0.68 | % | $ | 2.95 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.48 | 0.68 | % | $ | 3.42 | |||||||||||
PowerShares Listed Private Equity Portfolio Actual | $ | 1,000.00 | $ | 813.78 | 0.70 | % | $ | 3.16 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.38 | 0.70 | % | $ | 3.52 |
36
Fees and Expenses (Continued)
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Lux Nanotech Portfolio Actual | $ | 1,000.00 | $ | 802.17 | 0.70 | % | $ | 3.14 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.38 | 0.70 | % | $ | 3.52 | |||||||||||
Beginning Account Value December 20, 2007 (Fund Inception) | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Number of Days in the Period | Expenses Paid During Period (2) December 20, 2007 (Fund Inception) to April 30, 2008 | ||||||||||||||||
PowerShares S&P 500 BuyWrite Portfolio Actual | $ | 1,000.00 | $ | 998.15 | 0.75 | % | $ | 2.70 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.13 | 0.75 | % | $ | 3.77 | |||||||||||
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Value Line Industry Rotation Portfolio Actual | $ | 1,000.00 | $ | 901.76 | 0.71 | % | $ | 3.36 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.33 | 0.71 | % | $ | 3.57 | |||||||||||
PowerShares Value Line TimelinessTM Select Portfolio Actual | $ | 1,000.00 | $ | 868.84 | 0.70 | % | $ | 3.25 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.38 | 0.70 | % | $ | 3.52 | |||||||||||
PowerShares Water Resource Portfolio Actual | $ | 1,000.00 | $ | 928.50 | 0.62 | % | $ | 2.97 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.78 | 0.62 | % | $ | 3.12 | |||||||||||
PowerShares WilderHill Clean Energy Portfolio Actual | $ | 1,000.00 | $ | 826.69 | 0.66 | % | $ | 3.00 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.58 | 0.66 | % | $ | 3.32 | |||||||||||
PowerShares WilderHill Progressive Energy Portfolio Actual | $ | 1,000.00 | $ | 900.00 | 0.70 | % | $ | 3.31 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.38 | 0.70 | % | $ | 3.52 |
(1) Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six months ended April 30, 2008. Expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 182 and then dividing the result by 366. Expense ratios for the most recent half-year may differ from expense ratios based on the one year data in the financial highlights.
(2) Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the period ended April 30, 2008. Expense are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 133 and then dividing the result by 366. Hypothetical expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 182 and then dividing the result by 366.
37
Schedule of Investments
PowerShares Aerospace and Defense Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.8% | |||||||||||
Aerospace/Defense—55.9% | |||||||||||
37,864 | AAR Corp.* | $ | 886,018 | ||||||||
19,719 | Aerovironment, Inc.* | 471,481 | |||||||||
32,053 | Alliant Techsystems, Inc.* | 3,525,189 | |||||||||
21,397 | Argon ST, Inc.* | 393,919 | |||||||||
231,881 | Boeing Co. | 19,677,422 | |||||||||
26,116 | Cubic Corp. | 708,005 | |||||||||
40,422 | DRS Technologies, Inc. | 2,523,950 | |||||||||
10,309 | Ducommun, Inc.* | 335,867 | |||||||||
41,133 | Elbit Systems Ltd. (Israel) | 2,251,209 | |||||||||
28,738 | Esterline Technologies Corp.* | 1,599,557 | |||||||||
55,708 | GenCorp, Inc.* | 477,418 | |||||||||
176,799 | General Dynamics Corp. | 15,986,166 | |||||||||
122,232 | Goodrich Corp. | 8,330,111 | |||||||||
90,731 | L-3 Communications Holdings, Inc. | 10,111,970 | |||||||||
174,704 | Lockheed Martin Corp. | 18,525,612 | |||||||||
41,628 | Moog, Inc., Class A* | 1,794,583 | |||||||||
14,825 | MTC Technologies, Inc.* | 353,725 | |||||||||
149,885 | Northrop Grumman Corp. | 11,027,039 | |||||||||
57,096 | Orbital Sciences Corp.* | 1,536,453 | |||||||||
189,087 | Raytheon Co. | 12,095,895 | |||||||||
158,824 | Rockwell Collins, Inc. | 10,023,383 | |||||||||
34,515 | Teledyne Technologies, Inc.* | 2,027,066 | |||||||||
16,328 | Triumph Group, Inc. | 961,229 | |||||||||
254,064 | United Technologies Corp. | 18,412,018 | |||||||||
144,035,285 | |||||||||||
Auto Manufacturers—1.1% | |||||||||||
72,526 | Oshkosh Truck Corp. | 2,944,556 | |||||||||
Commercial Services—3.4% | |||||||||||
55,704 | DynCorp International, Inc., Class A* | 999,887 | |||||||||
403,937 | SAIC, Inc.* | 7,674,803 | |||||||||
8,674,690 | |||||||||||
Computers—4.0% | |||||||||||
29,401 | CACI International, Inc., Class A* | 1,473,578 | |||||||||
159,828 | Computer Sciences Corp.* | 6,966,902 | |||||||||
22,290 | Mercury Computer Systems, Inc.* | 178,766 | |||||||||
12,902 | SI International, Inc.* | 295,972 | |||||||||
56,722 | SRA International, Inc., Class A* | 1,490,087 | |||||||||
10,405,305 | |||||||||||
Electronics—7.1% | |||||||||||
8,873 | American Science & Engineering, Inc. | 432,381 | |||||||||
92,872 | Cogent, Inc.* | 866,496 | |||||||||
134,375 | FLIR Systems, Inc.* | 4,613,094 | |||||||||
160,272 | Garmin Ltd. | 6,555,125 | |||||||||
73,530 | L-1 Identity Solutions, Inc.* | 1,059,567 | |||||||||
17,267 | OSI Systems, Inc.* | 422,178 | |||||||||
61,883 | Taser International, Inc.* | 461,647 | |||||||||
118,406 | Trimble Navigation Ltd.* | 3,882,533 | |||||||||
18,293,021 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Engineering & Construction—1.5% | |||||||||||
21,910 | Stanley, Inc.* | $ | 552,789 | ||||||||
81,568 | URS Corp.* | 3,290,453 | |||||||||
3,843,242 | |||||||||||
Metal Fabricate/Hardware—4.6% | |||||||||||
14,203 | Ladish Co., Inc.* | 426,942 | |||||||||
95,902 | Precision Castparts Corp. | 11,274,239 | |||||||||
11,701,181 | |||||||||||
Miscellaneous Manufacturing—16.3% | |||||||||||
26,706 | Ceradyne, Inc.* | 1,040,466 | |||||||||
317,926 | Honeywell International, Inc. | 18,884,804 | |||||||||
177,587 | ITT Corp. | 11,365,568 | |||||||||
175,130 | Textron, Inc. | 10,684,681 | |||||||||
41,975,519 | |||||||||||
Packaging & Containers—2.0% | |||||||||||
95,367 | Ball Corp. | 5,128,837 | |||||||||
Software—0.6% | |||||||||||
33,763 | ManTech International Corp., Class A* | 1,612,859 | |||||||||
Telecommunications—3.3% | |||||||||||
12,305 | Applied Signal Technology, Inc. | 140,769 | |||||||||
18,094 | GeoEye, Inc.* | 416,705 | |||||||||
133,391 | Harris Corp. | 7,207,116 | |||||||||
29,773 | Viasat, Inc.* | 657,983 | |||||||||
8,422,573 | |||||||||||
Total Common Stocks (Cost $273,794,496) | 257,037,068 | ||||||||||
Money Market Fund—0.1% | |||||||||||
153,456 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $153,456) | 153,456 | |||||||||
Total Investments (Cost $273,947,952)—99.9% | 257,190,524 | ||||||||||
Other assets less liabilities—0.1% | 304,941 | ||||||||||
Net Assets—100.0% | $ | 257,495,465 |
* Non-income producing security.
See Notes to Financial Statements.
38
Schedule of Investments
PowerShares CleantechTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Biotechnology—2.4% | |||||||||||
77,321 | Martek Biosciences Corp.* | $ | 2,726,338 | ||||||||
Chemicals—2.4% | |||||||||||
91,664 | Landec Corp.* | 743,395 | |||||||||
73,438 | Zoltek Cos., Inc.* | 1,958,592 | |||||||||
2,701,987 | |||||||||||
Computers—1.3% | |||||||||||
54,373 | Echelon Corp.* | 612,240 | |||||||||
31,518 | Telvent GIT SA (Spain) | 868,006 | |||||||||
1,480,246 | |||||||||||
Electric—2.0% | |||||||||||
46,804 | Ormat Technologies, Inc. | 2,307,437 | |||||||||
Electrical Components & Equipment—4.0% | |||||||||||
26,580 | American Superconductor Corp.* | 671,942 | |||||||||
54,937 | Energy Conversion Devices, Inc.* | 1,790,397 | |||||||||
67,397 | EnerSys* | 1,577,090 | |||||||||
41,106 | PowerSecure International, Inc.* | 499,849 | |||||||||
4,539,278 | |||||||||||
Electronics—12.6% | |||||||||||
36,816 | Badger Meter, Inc. | 1,917,009 | |||||||||
30,999 | Dionex Corp.* | 2,424,742 | |||||||||
34,481 | Itron, Inc.* | 3,209,491 | |||||||||
109,219 | Trimble Navigation Ltd.* | 3,581,292 | |||||||||
94,771 | Woodward Governor Co. | 3,329,305 | |||||||||
14,461,839 | |||||||||||
Energy - Alternate Sources—14.1% | |||||||||||
21,354 | Comverge, Inc.* | 280,164 | |||||||||
16,210 | First Solar, Inc.* | 4,733,159 | |||||||||
117,993 | Headwaters, Inc.* | 1,348,660 | |||||||||
58,614 | LDK Solar Co., Ltd. ADR (China)* | 1,860,408 | |||||||||
45,568 | SunPower Corp., Class A* | 3,976,719 | |||||||||
88,721 | Suntech Power Holdings Co. Ltd. ADR (China)* | 3,968,490 | |||||||||
16,167,600 | |||||||||||
Engineering & Construction—5.1% | |||||||||||
135,089 | ABB Ltd. ADR (Switzerland) | 4,143,179 | |||||||||
100,230 | Insituform Technologies, Inc., Class A* | 1,695,892 | |||||||||
5,839,071 | |||||||||||
Environmental Control—8.8% | |||||||||||
35,331 | Clean Harbors, Inc.* | 2,330,786 | |||||||||
68,767 | Fuel Tech, Inc.* | 1,767,312 | |||||||||
146,555 | Nalco Holding Co. | 3,369,299 | |||||||||
121,361 | Tetra Tech, Inc.* | 2,564,358 | |||||||||
10,031,755 | |||||||||||
Hand/Machine Tools—2.3% | |||||||||||
81,694 | Baldor Electric Co. | 2,646,886 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Machinery - Diversified—6.3% | |||||||||||
53,690 | Kadant, Inc.* | $ | 1,400,235 | ||||||||
22,573 | Lindsay Corp. | 2,350,301 | |||||||||
54,784 | Roper Industries, Inc. | 3,403,182 | |||||||||
7,153,718 | |||||||||||
Miscellaneous Manufacturing—21.2% | |||||||||||
73,731 | Clarcor, Inc. | 3,093,753 | |||||||||
79,386 | Donaldson Co., Inc. | 3,456,466 | |||||||||
57,091 | ESCO Technologies, Inc.* | 2,658,157 | |||||||||
132,615 | Hexcel Corp.* | 2,967,924 | |||||||||
84,390 | Pall Corp. | 2,934,240 | |||||||||
63,897 | Polypore International, Inc.* | 1,495,829 | |||||||||
32,906 | Siemens AG ADR (Germany) | 3,897,716 | |||||||||
30,399 | SPX Corp. | 3,739,077 | |||||||||
24,243,162 | |||||||||||
Office Furnishings—1.4% | |||||||||||
127,860 | Interface, Inc., Class A | 1,641,722 | |||||||||
Semiconductors—6.6% | |||||||||||
106,477 | Cree, Inc.* | 2,768,402 | |||||||||
44,012 | MEMC Electronic Materials, Inc.* | 2,771,436 | |||||||||
65,849 | Power Integrations, Inc.* | 2,052,513 | |||||||||
7,592,351 | |||||||||||
Software—2.9% | |||||||||||
81,914 | Ansys, Inc.* | 3,295,400 | |||||||||
Telecommunications—3.4% | |||||||||||
147,126 | Corning, Inc. | 3,929,735 | |||||||||
Water—3.2% | |||||||||||
49,837 | Veolia Environnement ADR (France) | 3,610,691 | |||||||||
Total Investments (Cost: $112,939,741)—100.0% | 114,369,216 | ||||||||||
Liabilities in excess of other assets—(0.0%) | (32,909 | ) | |||||||||
Net Assets—100.0% | $ | 114,336,307 |
ADR American Depositary Receipt.
* Non-income producing security.
See Notes to Financial Statements.
39
Schedule of Investments
PowerShares DWA Technical LeadersTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests—100.0% | |||||||||||
Consumer Discretionary—7.1% | |||||||||||
53,512 | BorgWarner, Inc. | $ | 2,630,115 | ||||||||
66,155 | GameStop Corp., Class A* | 3,641,171 | |||||||||
60,927 | Guess?, Inc. | 2,332,286 | |||||||||
121,135 | International Game Technology | 4,208,229 | |||||||||
55,514 | Johnson Controls, Inc. | 1,957,424 | |||||||||
30,104 | NIKE, Inc., Class B | 2,010,947 | |||||||||
34,355 | Polo Ralph Lauren Corp. | 2,133,789 | |||||||||
116,955 | Urban Outfitters, Inc.* | 4,005,709 | |||||||||
74,044 | Yum! Brands, Inc. | 3,012,110 | |||||||||
25,931,780 | |||||||||||
Consumer Staples—4.4% | |||||||||||
54,719 | Archer-Daniels-Midland Co. | 2,410,919 | |||||||||
43,497 | Church & Dwight Co., Inc. | 2,471,500 | |||||||||
93,676 | Energizer Holdings, Inc.* | 7,406,024 | |||||||||
54,062 | Pepsi Bottling Group (The), Inc. | 1,822,430 | |||||||||
32,673 | UST, Inc. | 1,701,283 | |||||||||
15,812,156 | |||||||||||
Energy—12.0% | |||||||||||
16,925 | Apache Corp. | 2,279,459 | |||||||||
50,974 | Cabot Oil & Gas Corp. | 2,903,989 | |||||||||
63,923 | Chesapeake Energy Corp. | 3,304,819 | |||||||||
18,256 | Diamond Offshore Drilling, Inc. | 2,289,485 | |||||||||
51,692 | FMC Technologies, Inc.* | 3,473,702 | |||||||||
64,535 | Halliburton Co. | 2,962,802 | |||||||||
20,870 | Hess Corp. | 2,216,394 | |||||||||
44,215 | Noble Energy, Inc. | 3,846,705 | |||||||||
48,404 | Occidental Petroleum Corp. | 4,027,697 | |||||||||
14,617 | Transocean, Inc.* | 2,155,423 | |||||||||
266,823 | Williams (The) Cos, Inc. | 9,472,217 | |||||||||
75,420 | XTO Energy, Inc. | 4,665,481 | |||||||||
43,598,173 | |||||||||||
Financials—11.6% | |||||||||||
35,837 | Arch Capital Group Ltd.* | 2,531,884 | |||||||||
29,141 | BlackRock, Inc. | 5,880,362 | |||||||||
53,237 | General Growth Properties, Inc. | 2,180,588 | |||||||||
45,041 | Jones Lang LaSalle, Inc. | 3,495,632 | |||||||||
60,896 | Leucadia National Corp. | 3,119,093 | |||||||||
83,891 | Marshall & Ilsley Corp. | 2,095,597 | |||||||||
101,809 | New York Community Bancorp, Inc. | 1,900,774 | |||||||||
117,740 | People's United Financial, Inc. | 1,998,048 | |||||||||
20,900 | Public Storage | 1,895,630 | |||||||||
38,757 | RenaissanceRe Holdings Ltd. (Bermuda) | 1,993,660 | |||||||||
19,807 | Simon Property Group, Inc. | 1,977,927 | |||||||||
43,634 | Taubman Centers, Inc. | 2,472,739 | |||||||||
149,296 | Ventas, Inc. | 7,249,814 | |||||||||
136,790 | W.R. Berkley Corp. | 3,514,135 | |||||||||
42,305,883 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Health Care—9.9% | |||||||||||
92,544 | Celgene Corp.* | $ | 5,750,684 | ||||||||
60,421 | Covance, Inc.* | 5,062,676 | |||||||||
23,927 | C.R. Bard, Inc. | 2,253,206 | |||||||||
51,830 | DENTSPLY International, Inc. | 2,014,632 | |||||||||
110,600 | Gilead Sciences, Inc.* | 5,724,656 | |||||||||
63,602 | Henry Schein, Inc.* | 3,521,643 | |||||||||
57,470 | IDEXX Laboratories, Inc.* | 3,057,404 | |||||||||
128,550 | Pediatrix Medical Group, Inc.* | 8,743,970 | |||||||||
36,128,871 | |||||||||||
Industrials—27.0% | |||||||||||
26,190 | Alliant Techsystems, Inc.* | 2,880,376 | |||||||||
76,964 | AMETEK, Inc. | 3,734,293 | |||||||||
38,482 | Brink's (The) Co. | 2,799,565 | |||||||||
21,220 | Burlington Northern Santa Fe Corp. | 2,176,111 | |||||||||
80,359 | C.H. Robinson Worldwide, Inc. | 5,036,902 | |||||||||
25,853 | Caterpillar, Inc. | 2,116,844 | |||||||||
174,898 | Corrections Corp. of America* | 4,459,899 | |||||||||
354,872 | Covanta Holding Corp.* | 9,450,241 | |||||||||
44,690 | CSX Corp. | 2,813,236 | |||||||||
26,985 | Deere & Co. | 2,268,629 | |||||||||
46,035 | Donaldson Co., Inc. | 2,004,364 | |||||||||
24,340 | Dun & Bradstreet (The) Corp. | 2,051,862 | |||||||||
94,164 | Expeditors International of Washington, Inc. | 4,387,101 | |||||||||
15,105 | First Solar, Inc.* | 4,410,509 | |||||||||
30,899 | Flowserve Corp. | 3,834,257 | |||||||||
47,091 | Harsco Corp. | 2,793,909 | |||||||||
35,731 | ITT Corp. | 2,286,784 | |||||||||
149,327 | J.B. Hunt Transport Services, Inc. | 5,072,638 | |||||||||
68,892 | Joy Global, Inc. | 5,115,231 | |||||||||
69,518 | Kansas City Southern* | 3,133,871 | |||||||||
49,185 | Kirby Corp.* | 2,697,305 | |||||||||
27,046 | Lockheed Martin Corp. | 2,867,958 | |||||||||
200,713 | McDermott International, Inc.* | 10,754,203 | |||||||||
35,225 | Norfolk Southern Corp. | 2,098,706 | |||||||||
54,719 | Terex Corp.* | 3,812,820 | |||||||||
79,059 | WESCO International, Inc.* | 2,941,785 | |||||||||
97,999,399 | |||||||||||
Information Technology—3.3% | |||||||||||
63,541 | Cognizant Technology Solutions Corp., Class A* | 2,049,197 | |||||||||
50,224 | Global Payments, Inc. | 2,222,914 | |||||||||
8,072 | Mastercard, Inc., Class A | 2,245,308 | |||||||||
50,592 | MEMC Electronic Materials, Inc.* | 3,185,778 | |||||||||
33,605 | Salesforce.com, Inc.* | 2,242,462 | |||||||||
11,945,659 | |||||||||||
Materials—12.5% | |||||||||||
94,945 | Airgas, Inc. | 4,569,703 | |||||||||
82,209 | AK Steel Holding Corp. | 5,161,080 |
See Notes to Financial Statements.
40
Schedule of Investments (Continued)
PowerShares DWA Technical LeadersTM Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
98,828 | Allegheny Technologies, Inc. | $ | 6,802,330 | ||||||||
60,315 | Ball Corp. | 3,243,741 | |||||||||
31,235 | Cleveland-Cliffs, Inc. | 5,010,094 | |||||||||
35,363 | FMC Corp. | 2,220,089 | |||||||||
37,000 | Monsanto Co. | 4,218,740 | |||||||||
26,909 | Mosaic (The) Co.* | 3,296,622 | |||||||||
25,028 | Praxair, Inc. | 2,285,307 | |||||||||
46,647 | Reliance Steel & Aluminum Co. | 2,835,205 | |||||||||
38,375 | Sigma-Aldrich Corp. | 2,188,143 | |||||||||
24,264 | United States Steel Corp. | 3,735,443 | |||||||||
45,566,497 | |||||||||||
Telecommunication Services—7.0% | |||||||||||
353,159 | American Tower Corp., Class A* | 15,334,164 | |||||||||
258,551 | Crown Castle International Corp.* | 10,044,706 | |||||||||
25,378,870 | |||||||||||
Utilities—5.2% | |||||||||||
45,760 | Edison International | 2,387,299 | |||||||||
54,887 | Energen Corp. | 3,745,489 | |||||||||
23,820 | Entergy Corp. | 2,735,965 | |||||||||
67,867 | Equitable Resources, Inc. | 4,504,333 | |||||||||
44,460 | PPL Corp. | 2,134,969 | |||||||||
54,994 | Questar Corp. | 3,411,278 | |||||||||
18,919,333 | |||||||||||
Total Investments (Cost $347,641,723)—100.0% | 363,586,621 | ||||||||||
Liabilities in excess of other assets—(0.0%) | (72,817 | ) | |||||||||
Net Assets—100.0% | $ | 363,513,804 |
* Non-income producing security.
See Notes to Financial Statements.
41
Schedule of Investments
PowerShares Golden Dragon Halter USX China Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.7% | |||||||||||
Bermuda—0.5% | |||||||||||
94,711 | China Yuchai International Ltd. | $ | 888,389 | ||||||||
118,350 | Global Sources Ltd.* | 1,643,882 | |||||||||
2,532,271 | |||||||||||
British Virgin Islands—0.1% | |||||||||||
58,385 | Origin Agritech Ltd.* | 372,496 | |||||||||
Cayman Islands—6.5% | |||||||||||
55,213 | 3SBio, Inc. ADR* | 576,976 | |||||||||
215,921 | Actions Semiconductor Co. Ltd. ADR* | 833,455 | |||||||||
141,030 | China Digital TV Holding Co. Ltd. ADR* | 2,376,356 | |||||||||
69,631 | China Medical Technologies, Inc. ADR | 2,604,199 | |||||||||
262,070 | China Nepstar Chain Drugstore Ltd. ADR | 3,095,047 | |||||||||
110,096 | China Techfaith Wireless Communication Technology Ltd. ADR* | 598,922 | |||||||||
209,596 | E-House China Holdings Ltd. ADR* | 3,504,445 | |||||||||
125,233 | Longtop Financial Technologies Ltd. ADR* | 2,498,398 | |||||||||
89,651 | New Oriental Education & Technology Group. ADR* | 6,729,204 | |||||||||
93,317 | Noah Education Holdings Ltd. ADR* | 574,833 | |||||||||
28,389 | Perfect World Co. Ltd. ADR* | 815,332 | |||||||||
944,387 | Semiconductor Manufacturing International Corp. ADR* | 3,598,114 | |||||||||
105,320 | Spreadtrum Communications, Inc. ADR* | 915,231 | |||||||||
63,366 | Trina Solar Ltd. ADR* | 2,672,778 | |||||||||
156,362 | WuXi PharmaTech Cayman, Inc. ADR* | 2,883,316 | |||||||||
34,276,606 | |||||||||||
China—70.0% | |||||||||||
72,420 | 51job, Inc. ADR* | 1,332,528 | |||||||||
76,882 | Acorn International, Inc. ADR* | 530,486 | |||||||||
160,609 | Agria Corp. ADR* | 695,437 | |||||||||
521,705 | Aluminum Corp. of China Ltd. ADR | 22,339,408 | |||||||||
83,345 | Baidu.com ADR* | 30,470,931 | |||||||||
69,302 | Canadian Solar, Inc.* | 1,896,796 | |||||||||
123,680 | China Eastern Airlines Corp. Ltd. ADR* | 5,354,107 | |||||||||
53,057 | China Finance Online Co. Ltd. ADR* | 978,902 | |||||||||
387,066 | China Life Insurance Co. Ltd. ADR | 25,391,530 | |||||||||
237,633 | China Petroleum and Chemical Corp. ADR | 25,547,924 | |||||||||
108,978 | China Security & Surveillance Technology, Inc.* | 2,119,622 | |||||||||
222,322 | China Southern Airlines Co. Ltd. ADR* | 7,301,055 | |||||||||
100,524 | China Sunergy Co. Ltd. ADR* | 826,307 | |||||||||
320,142 | China Telecom Corp. Ltd. ADR | 21,638,398 | |||||||||
49,500 | ChinaEdu Corp. ADR* | 346,500 | |||||||||
165,526 | Ctrip.com International Ltd. ADR | 10,272,543 | |||||||||
63,844 | eLong, Inc. ADR* | 597,580 | |||||||||
326,885 | Focus Media Holding Ltd. ADR* | 12,058,787 | |||||||||
33,201 | Fuwei Films Holdings Co. Ltd.* | 100,599 | |||||||||
653,732 | Giant Interactive Group, Inc. ADR* | 10,655,832 | |||||||||
360,031 | Guangshen Railway Co. Ltd. ADR | 10,397,695 | |||||||||
211,987 | Gushan Environmental Energy Ltd. ADR | 2,649,838 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
88,472 | Home Inns & Hotels Management, Inc. ADR* | $ | 1,982,658 | ||||||||
718,836 | Huaneng Power International, Inc. ADR | 24,188,831 | |||||||||
56,663 | Hurray! Holding Co. Ltd. ADR* | 156,957 | |||||||||
399,644 | JA Solar Holdings Co. Ltd. ADR* | 9,595,452 | |||||||||
90,418 | KongZhong Corp. ADR* | 382,468 | |||||||||
265,795 | LDK Solar Co. Ltd. ADR* | 8,436,333 | |||||||||
60,794 | Linktone Ltd. ADR* | 130,707 | |||||||||
263,608 | Mindray Medical International Ltd. ADR | 8,962,672 | |||||||||
324,156 | Netease.com, Inc. ADR* | 7,235,162 | |||||||||
88,924 | Ninetowns Internet Technology Group Co. Ltd. ADR* | 198,301 | |||||||||
216,266 | PetroChina Co. Ltd. ADR | 32,686,442 | |||||||||
133,420 | Qiao Xing Mobile Communication Co. Ltd.* | 857,890 | |||||||||
75,347 | Qiao Xing Universal Telephone, Inc.* | 479,207 | |||||||||
181,971 | Shanda Interactive Entertainment Ltd. ADR* | 6,239,786 | |||||||||
158,831 | Simcere Pharmaceutical Group ADR* | 1,999,682 | |||||||||
138,929 | SINA Corp.* | 6,418,520 | |||||||||
182,972 | Sinopec Shanghai Petrochemical Co. Ltd. ADR | 7,236,543 | |||||||||
102,333 | Sinovac Biotech Ltd.* | 393,982 | |||||||||
145,901 | Solarfun Power Holdings Co. Ltd. ADR* | 1,959,450 | |||||||||
382,365 | Suntech Power Holdings Co. Ltd. ADR* | 17,103,185 | |||||||||
73,097 | The9 Ltd. ADR* | 1,569,393 | |||||||||
84,937 | Tongjitang Chinese Medicines Co. ADR* | 696,483 | |||||||||
173,697 | VisionChina Media, Inc. ADR* | 2,562,031 | |||||||||
254,130 | WSP Holdings Ltd. ADR* | 1,682,341 | |||||||||
175,439 | Xinhua Finance Media Ltd. ADR* | 729,826 | |||||||||
182,911 | Xinyuan Real Estate Co. Ltd. ADR* | 1,651,686 | |||||||||
249,981 | Yanzhou Coal Mining Co. Ltd. ADR | 23,168,239 | |||||||||
322,555 | Yingli Green Energy Holding Co. Ltd. ADR* | 7,105,887 | |||||||||
42,185 | Yucheng Technologies Ltd.* | 635,728 | |||||||||
369,948,647 | |||||||||||
Hong Kong—19.3% | |||||||||||
270,398 | CDC Corp., Class A* | 932,873 | |||||||||
372,576 | China Mobile Ltd. ADR | 32,160,761 | |||||||||
371,561 | China Netcom Group Corp. Ltd. ADR | 22,683,799 | |||||||||
898,946 | China Unicom Ltd. ADR | 19,390,265 | |||||||||
142,244 | CNOOC Ltd. ADR | 25,255,422 | |||||||||
40,133 | Deswell Industries, Inc. | 258,858 | |||||||||
113,864 | Nam Tai Electronics, Inc. | 1,173,938 | |||||||||
101,855,916 | |||||||||||
South Korea—0.0% | |||||||||||
109,902 | Webzen, Inc. ADR | 294,537 | |||||||||
United States—3.3% | |||||||||||
43,083 | American Dairy, Inc.* | 499,763 | |||||||||
114,750 | AsiaInfo Holdings, Inc.* | 1,396,508 | |||||||||
60,888 | China Automotive Systems, Inc.* | 314,182 | |||||||||
135,260 | China BAK Battery, Inc.* | 503,167 |
See Notes to Financial Statements.
42
Schedule of Investments (Continued)
PowerShares Golden Dragon Halter USX China Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
50,013 | China Shenghuo Pharmaceutical Holdings, Inc.* | $ | 171,044 | ||||||||
31,641 | Chindex International, Inc.* | 775,205 | |||||||||
97,835 | Comtech Group, Inc.* | 1,273,812 | |||||||||
53,172 | Fuqi International, Inc.* | 439,732 | |||||||||
69,769 | Fushi Copperweld, Inc.* | 1,128,165 | |||||||||
136,152 | HSW International, Inc.* | 545,970 | |||||||||
137,739 | ShengdaTech, Inc.* | 1,063,345 | |||||||||
95,918 | Sohu.com, Inc.* | 6,630,811 | |||||||||
46,449 | SORL Auto Parts, Inc.* | 230,387 | |||||||||
96,457 | Sutor Technology Group Ltd*. | 581,636 | |||||||||
26,445 | Telestone Technologies Corp.* | 122,176 | |||||||||
181,280 | Tiens Biotech Group USA, Inc.* | 351,683 | |||||||||
313,770 | UTStarcom, Inc.* | 1,019,753 | |||||||||
60,888 | Wonder Auto Technology, Inc.* | 463,358 | |||||||||
17,510,697 | |||||||||||
Total Investments (Cost $594,935,801)—99.7% | 526,791,170 | ||||||||||
Other assets less liabilities—0.3% | 1,691,831 | ||||||||||
Net Assets—100.0% | $ | 528,483,001 |
ADR American Depositary Receipt.
* Non-income producing security.
See Notes to Financial Statements.
43
Schedule of Investments
PowerShares Listed Private Equity Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests—99.1% | |||||||||||
Banks—5.0% | |||||||||||
107,046 | SVB Financial Group* | $ | 5,208,858 | ||||||||
Closed-end Funds—1.2% | |||||||||||
53,438 | Kayne Anderson Energy Development Co. | 1,185,255 | |||||||||
Commercial Services—4.6% | |||||||||||
160,694 | Macquarie Infrastructure Co. LLC | 4,756,542 | |||||||||
Diversified Financial Services—14.5% | |||||||||||
34,515 | Affiliated Managers Group, Inc.* | 3,428,720 | |||||||||
58,017 | Evercore Partners, Inc., Class A | 978,167 | |||||||||
723,013 | Fortress Investment Group LLC, Class A | 10,555,990 | |||||||||
14,962,877 | |||||||||||
Holding Companies - Diversified—13.3% | |||||||||||
152,017 | Compass Diversified Holdings | 1,863,728 | |||||||||
231,861 | Leucadia National Corp. | 11,875,921 | |||||||||
13,739,649 | |||||||||||
Internet—5.6% | |||||||||||
221,895 | CMGI, Inc.* | 3,068,808 | |||||||||
168,238 | Internet Capital Group, Inc.* | 1,690,792 | |||||||||
667,644 | Safeguard Scientifics, Inc.* | 1,068,230 | |||||||||
5,827,830 | |||||||||||
Investment Companies—48.7% | |||||||||||
330,285 | Allied Capital Corp. | 6,638,728 | |||||||||
271,322 | American Capital Strategies Ltd. | 8,614,473 | |||||||||
294,711 | Apollo Investment Corp. | 4,768,424 | |||||||||
340,481 | Ares Capital Corp. | 3,833,816 | |||||||||
230,984 | BlackRock Kelso Capital Corp. | 2,843,413 | |||||||||
18,745 | Capital Southwest Corp. | 2,229,530 | |||||||||
90,855 | Gladstone Capital Corp. | 1,706,257 | |||||||||
83,811 | Gladstone Investment Corp. | 743,404 | |||||||||
115,776 | Harris & Harris Group, Inc.* | 920,419 | |||||||||
141,501 | Hercules Technology Growth Capital, Inc. | 1,436,235 | |||||||||
365,091 | KKR Financial Holdings LLC | 4,636,656 | |||||||||
100,941 | Kohlberg Capital Corp. | 1,013,448 | |||||||||
304,674 | MCG Capital Corp. | 2,333,803 | |||||||||
102,022 | MVC Capital, Inc. | 1,587,462 | |||||||||
94,461 | NGP Capital Resources Co. | 1,523,656 | |||||||||
96,209 | Patriot Capital Funding, Inc. | 979,408 | |||||||||
124,195 | PennantPark Investment Corp. | 920,285 | |||||||||
117,644 | Prospect Capital Corp. | 1,745,837 | |||||||||
108,199 | TICC Capital Corp. | 787,689 | |||||||||
42,216 | Tortoise Capital Resources Corp. | 506,592 | |||||||||
53,427 | UTEK Corp.* | 566,860 | |||||||||
50,336,395 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
REIT—6.2% | |||||||||||
455,836 | CapitalSource, Inc. | $ | 6,404,496 | ||||||||
Total Common Stocks and Other Equity Interests (Cost $138,101,240) | 102,421,902 | ||||||||||
Money Market Fund—0.3% | |||||||||||
318,356 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $318,356) | 318,356 | |||||||||
Total Investments (Cost $138,419,596)—99.4% | 102,740,258 | ||||||||||
Other assets less liabilities—0.6% | 638,925 | ||||||||||
Net Assets—100.0% | $ | 103,379,183 |
REIT Real Estate Investment Trust.
* Non-income producing security.
See Notes to Financial Statements.
44
Schedule of Investments
PowerShares Lux Nanotech Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.5% | |||||||||||
Auto Manufacturers—3.2% | |||||||||||
26,404 | Toyota Motor Corp. ADR (Japan) | $ | 2,680,006 | ||||||||
Biotechnology—8.6% | |||||||||||
1,126,887 | Biosante Pharmaceuticals, Inc.*(a) | 4,439,935 | |||||||||
420,870 | Nanosphere, Inc.* | 2,802,994 | |||||||||
7,242,929 | |||||||||||
Chemicals—11.9% | |||||||||||
29,286 | Air Products & Chemicals, Inc. | 2,882,621 | |||||||||
58,758 | E.I. du Pont de Nemours & Co. | 2,873,854 | |||||||||
570,711 | Symyx Technologies, Inc.* | 4,286,039 | |||||||||
10,042,514 | |||||||||||
Commercial Services—12.2% | |||||||||||
1,613,334 | Altair Nanotechnologies, Inc.* | 3,710,668 | |||||||||
1,188,711 | Arrowhead Research Corp.* | 3,185,745 | |||||||||
493,013 | Luna Innovations, Inc.*(a) | 3,406,720 | |||||||||
10,303,133 | |||||||||||
Computers—6.5% | |||||||||||
57,942 | Hewlett-Packard Co. | 2,685,612 | |||||||||
23,462 | International Business Machines Corp. | 2,831,863 | |||||||||
5,517,475 | |||||||||||
Electronics—11.6% | |||||||||||
204,034 | FEI Co.* | 4,462,224 | |||||||||
166,766 | NVE Corp.*(a) | 5,311,497 | |||||||||
9,773,721 | |||||||||||
Energy - Alternate Sources—4.3% | |||||||||||
319,958 | Headwaters, Inc.* | 3,657,120 | |||||||||
Investment Companies—4.6% | |||||||||||
489,469 | Harris & Harris Group, Inc.* | 3,891,279 | |||||||||
Miscellaneous Manufacturing—10.6% | |||||||||||
34,871 | 3M Co. | 2,681,580 | |||||||||
74,108 | General Electric Co. | 2,423,332 | |||||||||
1,192,464 | Nanophase Technologies Corp.*(a) | 3,863,583 | |||||||||
8,968,495 | |||||||||||
Pharmaceuticals—11.8% | |||||||||||
206,239 | Elan Corp. PLC ADR (Ireland)* | 5,422,023 | |||||||||
486,560 | Flamel Technologies ADR (France)* | 4,515,277 | |||||||||
9,937,300 | |||||||||||
Semiconductors—8.9% | |||||||||||
125,423 | Intel Corp. | 2,791,916 | |||||||||
252,299 | Veeco Instruments, Inc.* | 4,750,790 | |||||||||
7,542,706 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Software—5.3% | |||||||||||
795,068 | Accelrys, Inc.* | $ | 4,476,233 | ||||||||
Total Investments (Cost $108,828,022)—99.5% | 84,032,911 | ||||||||||
Other assets less liabilities—0.5% | 395,304 | ||||||||||
Net Assets—100.0% | $ | 84,428,215 |
ADR American Depositary Receipt
* Non-income producing security.
(a) Affiliated Investment. See Note 4.
See Notes to Financial Statements.
45
Schedule of Investments
PowerShares S&P 500 BuyWrite Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests(a)—101.7% | |||||||||||
Consumer Discretionary—8.7% | |||||||||||
54 | Abercrombie & Fitch Co., Class A | $ | 4,013 | ||||||||
195 | Amazon.com, Inc.* | 15,333 | |||||||||
89 | Apollo Group, Inc., Class A* | 4,530 | |||||||||
85 | AutoNation, Inc.* | 1,361 | |||||||||
28 | AutoZone, Inc.* | 3,381 | |||||||||
167 | Bed Bath & Beyond, Inc.* | 5,428 | |||||||||
223 | Best Buy Co., Inc. | 9,593 | |||||||||
54 | Big Lots, Inc.* | 1,460 | |||||||||
39 | Black & Decker (The) Corp. | 2,560 | |||||||||
53 | Brunswick Corp. | 884 | |||||||||
276 | Carnival Corp. | 11,087 | |||||||||
430 | CBS Corp., Class B | 9,920 | |||||||||
80 | Centex Corp. | 1,666 | |||||||||
315 | Clear Channel Communications, Inc. | 9,497 | |||||||||
222 | Coach, Inc.* | 7,897 | |||||||||
1,901 | Comcast Corp., Class A | 39,065 | |||||||||
178 | D.R. Horton, Inc. | 2,757 | |||||||||
92 | Darden Restaurants, Inc. | 3,273 | |||||||||
35 | Dillard's, Inc., Class A | 714 | |||||||||
450 | DIRECTV Group (The), Inc.* | 11,088 | |||||||||
56 | E.W. Scripps Co., Class A | 2,515 | |||||||||
182 | Eastman Kodak Co. | 3,256 | |||||||||
132 | Expedia, Inc.* | 3,334 | |||||||||
89 | Family Dollar Stores, Inc. | 1,905 | |||||||||
1,393 | Ford Motor Co.* | 11,506 | |||||||||
97 | Fortune Brands, Inc. | 6,559 | |||||||||
104 | GameStop Corp., Class A* | 5,724 | |||||||||
146 | Gannett Co., Inc. | 4,179 | |||||||||
287 | Gap (The), Inc. | 5,344 | |||||||||
358 | General Motors Corp. | 8,306 | |||||||||
108 | Genuine Parts Co. | 4,586 | |||||||||
154 | Goodyear Tire & Rubber (The) Co.* | 4,124 | |||||||||
210 | H&R Block, Inc. | 4,593 | |||||||||
151 | Harley-Davidson, Inc. | 5,776 | |||||||||
38 | Harman International Industries, Inc. | 1,553 | |||||||||
91 | Hasbro, Inc. | 3,236 | |||||||||
1,065 | Home Depot (The), Inc. | 30,671 | |||||||||
114 | IAC/InterActiveCorp* | 2,372 | |||||||||
198 | International Game Technology | 6,879 | |||||||||
304 | Interpublic Group of Cos., Inc.* | 2,751 | |||||||||
143 | J. C. Penney Co., Inc. | 6,078 | |||||||||
375 | Johnson Controls, Inc. | 13,223 | |||||||||
53 | Jones Apparel Group, Inc. | 839 | |||||||||
47 | KB Home | 1,058 | |||||||||
198 | Kohl's Corp.* | 9,672 | |||||||||
105 | Leggett & Platt, Inc. | 1,743 | |||||||||
86 | Lennar Corp., Class A | 1,584 | |||||||||
201 | Limited Brands, Inc. | 3,723 | |||||||||
62 | Liz Claiborne, Inc. | 1,097 | |||||||||
924 | Lowe's Cos., Inc. | 23,276 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
279 | Macy's, Inc. | $ | 7,056 | ||||||||
190 | Marriott International, Inc., Class A | 6,517 | |||||||||
230 | Mattel, Inc. | 4,313 | |||||||||
727 | McDonald's Corp. | 43,314 | |||||||||
204 | McGraw-Hill (The) Cos., Inc. | 8,362 | |||||||||
23 | Meredith Corp. | 745 | |||||||||
89 | New York Times (The) Co., Class A | 1,736 | |||||||||
176 | Newell Rubbermaid, Inc. | 3,613 | |||||||||
1,453 | News Corp., Class A | 26,009 | |||||||||
241 | NIKE, Inc., Class B | 16,099 | |||||||||
116 | Nordstrom, Inc. | 4,090 | |||||||||
169 | Office Depot, Inc.* | 2,143 | |||||||||
47 | OfficeMax, Inc. | 859 | |||||||||
205 | Omnicom Group, Inc. | 9,787 | |||||||||
38 | Polo Ralph Lauren Corp. | 2,360 | |||||||||
133 | Pulte Homes, Inc. | 1,734 | |||||||||
83 | RadioShack Corp. | 1,154 | |||||||||
47 | Sears Holdings Corp.* | 4,635 | |||||||||
65 | Sherwin-Williams (The) Co. | 3,596 | |||||||||
36 | Snap-On, Inc. | 2,135 | |||||||||
49 | Stanley Works (The) | 2,364 | |||||||||
442 | Staples, Inc. | 9,591 | |||||||||
461 | Starbucks Corp.* | 7,482 | |||||||||
119 | Starwood Hotels & Resorts Worldwide, Inc. | 6,213 | |||||||||
517 | Target Corp. | 27,467 | |||||||||
82 | Tiffany & Co. | 3,570 | |||||||||
2,258 | Time Warner, Inc. | 33,530 | |||||||||
276 | TJX Cos., Inc. | 8,893 | |||||||||
56 | VF Corp. | 4,165 | |||||||||
405 | Viacom, Inc., Class B* | 15,568 | |||||||||
1,189 | Walt Disney (The) Co. | 38,558 | |||||||||
3 | Washington Post (The) Co., Class B | 1,967 | |||||||||
53 | Wendy's International, Inc. | 1,537 | |||||||||
48 | Whirlpool Corp. | 3,493 | |||||||||
110 | Wyndham Worldwide Corp. | 2,363 | |||||||||
300 | Yum! Brands, Inc. | 12,204 | |||||||||
656,191 | |||||||||||
Consumer Staples—10.7% | |||||||||||
1,332 | Altria Group, Inc. | 26,640 | |||||||||
451 | Anheuser-Busch Cos., Inc. | 22,189 | |||||||||
406 | Archer-Daniels-Midland Co. | 17,888 | |||||||||
270 | Avon Products, Inc. | 10,535 | |||||||||
54 | Brown-Forman Corp., Class B | 3,673 | |||||||||
140 | Campbell Soup Co. | 4,872 | |||||||||
89 | Clorox (The) Co. | 4,717 | |||||||||
1,262 | Coca-Cola (The) Co. | 74,294 | |||||||||
185 | Coca-Cola Enterprises, Inc. | 4,163 | |||||||||
322 | Colgate-Palmolive Co. | 22,765 | |||||||||
308 | ConAgra Foods, Inc. | 7,256 | |||||||||
121 | Constellation Brands, Inc., Class A* | 2,222 |
See Notes to Financial Statements.
46
Schedule of Investments (Continued)
PowerShares S&P 500 BuyWrite Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
274 | Costco Wholesale Corp. | $ | 19,523 | ||||||||
905 | CVS Caremark Corp. | 36,535 | |||||||||
96 | Dean Foods Co.* | 2,231 | |||||||||
72 | Estee Lauder (The) Cos., Inc., Class A | 3,284 | |||||||||
213 | General Mills, Inc. | 12,865 | |||||||||
199 | H.J. Heinz Co. | 9,359 | |||||||||
108 | Hershey (The) Co. | 4,037 | |||||||||
165 | Kellogg Co. | 8,443 | |||||||||
265 | Kimberly-Clark Corp. | 16,957 | |||||||||
968 | Kraft Foods, Inc., Class A | 30,618 | |||||||||
425 | Kroger (The) Co. | 11,581 | |||||||||
83 | McCormick & Co., Inc. | 3,137 | |||||||||
89 | Molson Coors Brewing Co., Class B | 4,881 | |||||||||
89 | Pepsi Bottling Group (The), Inc. | 3,000 | |||||||||
1,011 | PepsiCo, Inc. | 69,284 | |||||||||
1,332 | Philip Morris International, Inc.* | 67,972 | |||||||||
1,943 | Procter & Gamble (The) Co. | 130,277 | |||||||||
110 | Reynolds American, Inc. | 5,924 | |||||||||
278 | Safeway, Inc. | 8,785 | |||||||||
460 | Sara Lee Corp. | 6,675 | |||||||||
136 | SUPERVALU, Inc. | 4,502 | |||||||||
381 | Sysco Corp. | 11,647 | |||||||||
176 | Tyson Foods, Inc., Class A | 3,133 | |||||||||
96 | UST, Inc. | 4,999 | |||||||||
626 | Walgreen Co. | 21,816 | |||||||||
1,492 | Wal-Mart Stores, Inc. | 86,505 | |||||||||
90 | Whole Foods Market, Inc. | 2,938 | |||||||||
136 | Wm. Wrigley Jr. Co. | 10,358 | |||||||||
802,480 | |||||||||||
Energy—14.3% | |||||||||||
295 | Anadarko Petroleum Corp. | 19,635 | |||||||||
210 | Apache Corp. | 28,283 | |||||||||
195 | Baker Hughes, Inc. | 15,772 | |||||||||
185 | BJ Services Co. | 5,230 | |||||||||
138 | Cameron International Corp.* | 6,794 | |||||||||
289 | Chesapeake Energy Corp. | 14,941 | |||||||||
1,311 | Chevron Corp.(b) | 126,054 | |||||||||
986 | ConocoPhillips | 84,944 | |||||||||
115 | CONSOL Energy, Inc. | 9,310 | |||||||||
280 | Devon Energy Corp. | 31,752 | |||||||||
442 | El Paso Corp. | 7,576 | |||||||||
93 | ENSCO International, Inc. | 5,927 | |||||||||
156 | EOG Resources, Inc. | 20,355 | |||||||||
3,378 | Exxon Mobil Corp. | 314,391 | |||||||||
556 | Halliburton Co. | 25,526 | |||||||||
177 | Hess Corp. | 18,797 | |||||||||
448 | Marathon Oil Corp. | 20,415 | |||||||||
120 | Murphy Oil Corp. | 10,841 | |||||||||
179 | Nabors Industries Ltd. (Bermuda)* | 6,720 | |||||||||
261 | National Oilwell Varco, Inc.* | 17,865 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
169 | Noble Corp. | $ | 9,511 | ||||||||
108 | Noble Energy, Inc. | 9,396 | |||||||||
520 | Occidental Petroleum Corp. | 43,269 | |||||||||
171 | Peabody Energy Corp. | 10,453 | |||||||||
94 | Range Resources Corp. | 6,240 | |||||||||
71 | Rowan Cos., Inc. | 2,768 | |||||||||
756 | Schlumberger Ltd. | 76,016 | |||||||||
127 | Smith International, Inc. | 9,717 | |||||||||
400 | Spectra Energy Corp. | 9,880 | |||||||||
75 | Sunoco, Inc. | 3,481 | |||||||||
86 | Tesoro Corp. | 2,162 | |||||||||
201 | Transocean, Inc.* | 29,639 | |||||||||
337 | Valero Energy Corp. | 16,462 | |||||||||
214 | Weatherford International Ltd.* | 17,263 | |||||||||
370 | Williams (The) Cos., Inc. | 13,135 | |||||||||
322 | XTO Energy, Inc. | 19,919 | |||||||||
1,070,439 | |||||||||||
Financials—17.4% | |||||||||||
208 | ACE Ltd. | 12,540 | |||||||||
300 | Aflac, Inc. | 20,001 | |||||||||
354 | Allstate (The) Corp. | 17,827 | |||||||||
185 | AMBAC Financial Group, Inc. | 857 | |||||||||
124 | American Capital Strategies Ltd. | 3,937 | |||||||||
730 | American Express Co. | 35,055 | |||||||||
1,593 | American International Group, Inc. | 73,597 | |||||||||
146 | Ameriprise Financial, Inc. | 6,934 | |||||||||
193 | Aon Corp. | 8,760 | |||||||||
58 | Apartment Investment & Management Co., Class A | 2,145 | |||||||||
62 | Assurant, Inc. | 4,030 | |||||||||
48 | AvalonBay Communities, Inc. | 4,788 | |||||||||
2,805 | Bank of America Corp. | 105,299 | |||||||||
721 | Bank of New York Mellon (The) Corp. | 31,385 | |||||||||
345 | BB&T Corp. | 11,830 | |||||||||
76 | Bear Stearns (The) Cos., Inc. | 815 | |||||||||
75 | Boston Properties, Inc. | 7,537 | |||||||||
235 | Capital One Financial Corp. | 12,455 | |||||||||
112 | CB Richard Ellis Group, Inc., Class A* | 2,589 | |||||||||
593 | Charles Schwab (The) Corp. | 12,809 | |||||||||
234 | Chubb (The) Corp. | 12,395 | |||||||||
107 | Cincinnati Financial Corp. | 3,841 | |||||||||
178 | CIT Group, Inc.(b) | 1,938 | |||||||||
3,288 | Citigroup, Inc. | 83,087 | |||||||||
33 | CME Group, Inc. | 15,096 | |||||||||
98 | Comerica, Inc. | 3,404 | |||||||||
376 | Countrywide Financial Corp. | 2,173 | |||||||||
77 | Developers Diversified Realty Corp. | 3,307 | |||||||||
309 | Discover Financial Services | 5,627 | |||||||||
291 | E*TRADE Financial Corp.* | 1,158 | |||||||||
171 | Equity Residential | 7,100 |
See Notes to Financial Statements.
47
Schedule of Investments (Continued)
PowerShares S&P 500 BuyWrite Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
617 | Fannie Mae | $ | 17,461 | ||||||||
56 | Federated Investors, Inc., Class B | 1,875 | |||||||||
337 | Fifth Third Bancorp | 7,222 | |||||||||
80 | First Horizon National Corp. | 864 | |||||||||
99 | Franklin Resources, Inc. | 9,420 | |||||||||
408 | Freddie Mac | 10,163 | |||||||||
168 | General Growth Properties, Inc. | 6,881 | |||||||||
273 | Genworth Financial, Inc., Class A | 6,295 | |||||||||
250 | Goldman Sachs Group (The), Inc. | 47,843 | |||||||||
198 | Hartford Financial Services Group (The), Inc. | 14,111 | |||||||||
148 | HCP, Inc. | 5,284 | |||||||||
338 | Host Hotels & Resorts, Inc. | 5,814 | |||||||||
335 | Hudson City Bancorp, Inc. | 6,409 | |||||||||
231 | Huntington Bancshares, Inc. | 2,169 | |||||||||
45 | IntercontinentalExchange, Inc.* | 6,982 | |||||||||
94 | Janus Capital Group, Inc. | 2,638 | |||||||||
2,145 | JPMorgan Chase & Co. | 102,208 | |||||||||
252 | Keycorp | 6,081 | |||||||||
163 | Kimco Realty Corp. | 6,505 | |||||||||
86 | Legg Mason, Inc. | 5,184 | |||||||||
335 | Lehman Brothers Holdings, Inc. | 14,820 | |||||||||
108 | Leucadia National Corp. | 5,532 | |||||||||
168 | Lincoln National Corp. | 9,032 | |||||||||
277 | Loews Corp. | 11,664 | |||||||||
48 | M&T Bank Corp. | 4,475 | |||||||||
329 | Marsh & McLennan Cos., Inc. | 9,077 | |||||||||
169 | Marshall & Ilsley Corp. | 4,222 | |||||||||
136 | MBIA, Inc. | 1,414 | |||||||||
614 | Merrill Lynch & Co., Inc. | 30,596 | |||||||||
448 | MetLife, Inc. | 27,261 | |||||||||
75 | MGIC Investment Corp. | 977 | |||||||||
133 | Moody's Corp. | 4,916 | |||||||||
698 | Morgan Stanley | 33,923 | |||||||||
409 | National City Corp. | 2,577 | |||||||||
121 | Northern Trust Corp. | 8,967 | |||||||||
168 | NYSE Euronext | 11,105 | |||||||||
111 | Plum Creek Timber Co., Inc. | 4,533 | |||||||||
216 | PNC Financial Services Group, Inc. | 14,980 | |||||||||
163 | Principal Financial Group, Inc. | 8,747 | |||||||||
428 | Progressive (The) Corp. | 7,785 | |||||||||
163 | ProLogis | 10,205 | |||||||||
282 | Prudential Financial, Inc. | 21,350 | |||||||||
78 | Public Storage | 7,075 | |||||||||
438 | Regions Financial Corp. | 9,601 | |||||||||
58 | Safeco Corp. | 3,871 | |||||||||
141 | Simon Property Group, Inc. | 14,080 | |||||||||
301 | SLM Corp.* | 5,578 | |||||||||
234 | Sovereign Bancorp, Inc. | 1,748 | |||||||||
244 | State Street Corp. | 17,602 | |||||||||
222 | SunTrust Banks, Inc. | 12,377 | |||||||||
166 | T. Rowe Price Group, Inc. | 9,721 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
59 | Torchmark Corp. | $ | 3,820 | ||||||||
391 | Travelers (The) Cos., Inc. | 19,706 | |||||||||
1,092 | U.S. Bancorp | 37,008 | |||||||||
219 | Unum Group | 5,083 | |||||||||
85 | Vornado Realty Trust | 7,913 | |||||||||
1,344 | Wachovia Corp. | 39,178 | |||||||||
668 | Washington Mutual, Inc. | 8,210 | |||||||||
2,082 | Wells Fargo & Co. | 61,940 | |||||||||
114 | XL Capital Ltd., Class A | 3,977 | |||||||||
68 | Zions Bancorporation | 3,152 | |||||||||
1,305,523 | |||||||||||
Health Care—11.5% | |||||||||||
977 | Abbott Laboratories | 51,537 | |||||||||
313 | Aetna, Inc. | 13,647 | |||||||||
193 | Allergan, Inc. | 10,879 | |||||||||
103 | AmerisourceBergen Corp. | 4,177 | |||||||||
686 | Amgen, Inc.* | 28,723 | |||||||||
108 | Applera Corp. - Applied Biosystems Group | 3,446 | |||||||||
68 | Barr Pharmaceuticals, Inc.* | 3,416 | |||||||||
400 | Baxter International, Inc. | 24,928 | |||||||||
154 | Becton, Dickinson & Co. | 13,768 | |||||||||
189 | Biogen Idec, Inc.* | 11,470 | |||||||||
848 | Boston Scientific Corp.* | 11,304 | |||||||||
1,250 | Bristol-Myers Squibb Co. | 27,463 | |||||||||
63 | C.R. Bard, Inc. | 5,933 | |||||||||
225 | Cardinal Health, Inc. | 11,716 | |||||||||
274 | Celgene Corp.* | 17,026 | |||||||||
177 | CIGNA Corp. | 7,560 | |||||||||
98 | Coventry Health Care, Inc.* | 4,384 | |||||||||
315 | Covidien Ltd. | 14,707 | |||||||||
625 | Eli Lilly & Co. | 30,088 | |||||||||
160 | Express Scripts, Inc.* | 11,203 | |||||||||
196 | Forest Laboratories, Inc.* | 6,803 | |||||||||
169 | Genzyme Corp.* | 11,889 | |||||||||
587 | Gilead Sciences, Inc.* | 30,383 | |||||||||
102 | Hospira, Inc.* | 4,197 | |||||||||
108 | Humana, Inc.* | 5,161 | |||||||||
118 | IMS Health, Inc. | 2,921 | |||||||||
1,789 | Johnson & Johnson | 120,023 | |||||||||
152 | King Pharmaceuticals, Inc.* | 1,427 | |||||||||
71 | Laboratory Corp. of America Holdings* | 5,369 | |||||||||
183 | McKesson Corp. | 9,538 | |||||||||
331 | Medco Health Solutions, Inc.* | 16,398 | |||||||||
709 | Medtronic, Inc. | 34,514 | |||||||||
1,368 | Merck & Co., Inc. | 52,038 | |||||||||
36 | Millipore Corp.* | 2,524 | |||||||||
192 | Mylan, Inc. | 2,529 | |||||||||
84 | Patterson Cos., Inc.* | 2,873 | |||||||||
75 | PerkinElmer, Inc. | 1,992 | |||||||||
4,269 | Pfizer, Inc. | 85,849 |
See Notes to Financial Statements.
48
Schedule of Investments (Continued)
PowerShares S&P 500 BuyWrite Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
102 | Quest Diagnostics, Inc. | $ | 5,118 | ||||||||
1,023 | Schering-Plough Corp. | 18,833 | |||||||||
217 | St. Jude Medical, Inc.* | 9,500 | |||||||||
151 | Stryker Corp. | 9,789 | |||||||||
295 | Tenet Healthcare Corp.* | 1,888 | |||||||||
264 | Thermo Fisher Scientific, Inc.* | 15,278 | |||||||||
790 | UnitedHealth Group, Inc. | 25,778 | |||||||||
81 | Varian Medical Systems, Inc.* | 3,797 | |||||||||
65 | Waters Corp.* | 3,995 | |||||||||
66 | Watson Pharmaceuticals, Inc.* | 2,049 | |||||||||
342 | WellPoint, Inc.* | 17,015 | |||||||||
845 | Wyeth | 37,577 | |||||||||
147 | Zimmer Holdings, Inc. * | 10,902 | |||||||||
865,322 | |||||||||||
Industrials—12.0% | |||||||||||
447 | 3M Co. | 34,374 | |||||||||
213 | Allied Waste Industries, Inc.* | 2,633 | |||||||||
69 | Avery Dennison Corp. | 3,325 | |||||||||
483 | Boeing Co. | 40,987 | |||||||||
187 | Burlington Northern Santa Fe Corp. | 19,177 | |||||||||
110 | C.H. Robinson Worldwide, Inc. | 6,895 | |||||||||
394 | Caterpillar, Inc. | 32,261 | |||||||||
82 | Cintas Corp. | 2,428 | |||||||||
113 | Cooper Industries Ltd., Class A | 4,790 | |||||||||
255 | CSX Corp. | 16,052 | |||||||||
127 | Cummins, Inc. | 7,957 | |||||||||
160 | Danaher Corp. | 12,483 | |||||||||
276 | Deere & Co. | 23,203 | |||||||||
121 | Dover Corp. | 5,986 | |||||||||
103 | Eaton Corp. | 9,048 | |||||||||
497 | Emerson Electric Co. | 25,973 | |||||||||
82 | Equifax, Inc. | 3,138 | |||||||||
135 | Expeditors International of Washington, Inc. | 6,290 | |||||||||
195 | FedEx Corp. | 18,695 | |||||||||
56 | Fluor Corp.(b) | 8,561 | |||||||||
254 | General Dynamics Corp. | 22,967 | |||||||||
6,305 | General Electric Co. | 206,173 | |||||||||
80 | Goodrich Corp. | 5,452 | |||||||||
470 | Honeywell International, Inc. | 27,918 | |||||||||
253 | Illinois Tool Works, Inc. | 13,229 | |||||||||
172 | Ingersoll-Rand Co. Ltd., Class A | 7,633 | |||||||||
117 | ITT Corp. | 7,488 | |||||||||
76 | Jacobs Engineering Group, Inc.* | 6,561 | |||||||||
78 | L-3 Communications Holdings, Inc. | 8,693 | |||||||||
217 | Lockheed Martin Corp. | 23,011 | |||||||||
83 | Manitowoc (The) Co., Inc. | 3,139 | |||||||||
236 | Masco Corp. | 4,298 | |||||||||
79 | Monster Worldwide, Inc.* | 1,922 | |||||||||
238 | Norfolk Southern Corp. | 14,180 | |||||||||
213 | Northrop Grumman Corp. | 15,670 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
232 | PACCAR, Inc. | $ | 10,978 | ||||||||
78 | Pall Corp. | 2,712 | |||||||||
106 | Parker Hannifin Corp. | 8,464 | |||||||||
136 | Pitney Bowes, Inc. | 4,911 | |||||||||
89 | Precision Castparts Corp. | 10,463 | |||||||||
139 | R.R. Donnelley & Sons Co. | 4,259 | |||||||||
270 | Raytheon Co. | 17,272 | |||||||||
100 | Robert Half International, Inc. | 2,370 | |||||||||
96 | Rockwell Automation, Inc. | 5,206 | |||||||||
102 | Rockwell Collins, Inc. | 6,437 | |||||||||
36 | Ryder System, Inc. | 2,465 | |||||||||
473 | Southwest Airlines Co. | 6,263 | |||||||||
65 | Terex Corp.* | 4,529 | |||||||||
157 | Textron, Inc. | 9,579 | |||||||||
109 | Trane, Inc. | 5,070 | |||||||||
306 | Tyco International Ltd. (Bermuda) | 14,318 | |||||||||
165 | Union Pacific Corp. | 23,956 | |||||||||
653 | United Parcel Service, Inc., Class B | 47,283 | |||||||||
620 | United Technologies Corp. | 44,931 | |||||||||
42 | W.W. Grainger, Inc. | 3,642 | |||||||||
313 | Waste Management, Inc. | 11,299 | |||||||||
898,997 | |||||||||||
Information Technology—16.3% | |||||||||||
336 | Adobe Systems, Inc. * | 12,529 | |||||||||
391 | Advanced Micro Devices, Inc.* | 2,330 | |||||||||
62 | Affiliated Computer Services, Inc., Class A* | 3,284 | |||||||||
231 | Agilent Technologies, Inc.* | 6,979 | |||||||||
108 | Akamai Technologies, Inc.* | 3,863 | |||||||||
199 | Altera Corp. | 4,235 | |||||||||
186 | Analog Devices, Inc. | 5,991 | |||||||||
555 | Apple, Inc.* | 96,542 | |||||||||
855 | Applied Materials, Inc. | 15,954 | |||||||||
149 | Autodesk, Inc.* | 5,662 | |||||||||
330 | Automatic Data Processing, Inc. | 14,586 | |||||||||
122 | BMC Software, Inc.* | 4,241 | |||||||||
301 | Broadcom Corp., Class A* | 7,814 | |||||||||
246 | CA, Inc. | 5,446 | |||||||||
53 | Ciena Corp.* | 1,792 | |||||||||
3,764 | Cisco Systems, Inc.* | 96,509 | |||||||||
119 | Citrix Systems, Inc.* | 3,897 | |||||||||
186 | Cognizant Technology Solutions Corp., Class A* | 5,999 | |||||||||
106 | Computer Sciences Corp.* | 4,621 | |||||||||
175 | Compuware Corp.* | 1,320 | |||||||||
81 | Convergys Corp.* | 1,273 | |||||||||
995 | Corning, Inc. | 26,576 | |||||||||
1,290 | Dell, Inc.* | 24,033 | |||||||||
704 | eBay, Inc.* | 22,028 | |||||||||
201 | Electronic Arts, Inc.* | 10,345 | |||||||||
322 | Electronic Data Systems Corp. | 5,976 |
See Notes to Financial Statements.
49
Schedule of Investments (Continued)
PowerShares S&P 500 BuyWrite Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
1,326 | EMC Corp.* | $ | 20,420 | ||||||||
111 | Fidelity National Information Services, Inc. | 4,003 | |||||||||
105 | Fiserv, Inc.* | 5,308 | |||||||||
147 | Google, Inc., Class A* | 84,421 | |||||||||
1,557 | Hewlett-Packard Co. | 72,167 | |||||||||
3,655 | Intel Corp. | 81,360 | |||||||||
875 | International Business Machines Corp. | 105,613 | |||||||||
207 | Intuit, Inc.* | 5,583 | |||||||||
130 | Jabil Circuit, Inc. | 1,414 | |||||||||
145 | JDS Uniphase Corp.* | 2,075 | |||||||||
331 | Juniper Networks, Inc.* | 9,142 | |||||||||
116 | KLA-Tencor Corp. | 5,067 | |||||||||
59 | Lexmark International, Inc., Class A* | 1,852 | |||||||||
140 | Linear Technology Corp. | 4,894 | |||||||||
428 | LSI Corp.* | 2,654 | |||||||||
144 | MEMC Electronic Materials, Inc.* | 9,068 | |||||||||
123 | Microchip Technology, Inc. | 4,520 | |||||||||
480 | Micron Technology, Inc.* | 3,706 | |||||||||
5,054 | Microsoft Corp. | 144,141 | |||||||||
89 | Molex, Inc. | 2,526 | |||||||||
1,423 | Motorola, Inc. | 14,173 | |||||||||
144 | National Semiconductor Corp. | 2,936 | |||||||||
222 | NetApp, Inc.* | 5,372 | |||||||||
217 | Novell, Inc.* | 1,363 | |||||||||
68 | Novellus Systems, Inc.* | 1,486 | |||||||||
351 | Nvidia Corp.* | 7,213 | |||||||||
2,497 | Oracle Corp.* | 52,062 | |||||||||
204 | Paychex, Inc. | 7,419 | |||||||||
85 | QLogic Corp.* | 1,357 | |||||||||
1,018 | QUALCOMM, Inc. | 43,967 | |||||||||
144 | SanDisk Corp.* | 3,901 | |||||||||
500 | Sun Microsystems, Inc.* | 7,830 | |||||||||
535 | Symantec Corp.* | 9,213 | |||||||||
267 | Tellabs, Inc.* | 1,378 | |||||||||
117 | Teradata Corp.* | 2,491 | |||||||||
108 | Teradyne, Inc.* | 1,435 | |||||||||
837 | Texas Instruments, Inc. | 24,407 | |||||||||
129 | Total System Services, Inc. | 3,070 | |||||||||
307 | Tyco Electronics Ltd. | 11,485 | |||||||||
216 | Unisys Corp.* | 899 | |||||||||
137 | VeriSign, Inc.* | 4,939 | |||||||||
473 | Western Union (The) Co. | 10,879 | |||||||||
580 | Xerox Corp. | 8,103 | |||||||||
184 | Xilinx, Inc. | 4,558 | |||||||||
845 | Yahoo!, Inc.* | 23,161 | |||||||||
1,218,856 | |||||||||||
Materials—3.6% | |||||||||||
135 | Air Products & Chemicals, Inc. | 13,288 | |||||||||
514 | Alcoa, Inc. | 17,877 | |||||||||
65 | Allegheny Technologies, Inc. | 4,474 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
35 | Ashland, Inc. | $ | 1,856 | ||||||||
61 | Ball Corp. | 3,281 | |||||||||
62 | Bemis Co., Inc. | 1,631 | |||||||||
593 | Dow Chemical (The) Co. | 23,809 | |||||||||
568 | E.I. du Pont de Nemours & Co. | 27,780 | |||||||||
51 | Eastman Chemical Co. | 3,749 | |||||||||
111 | Ecolab, Inc. | 5,102 | |||||||||
241 | Freeport-McMoRan Copper & Gold, Inc., Class B | 27,413 | |||||||||
71 | Hercules, Inc. | 1,335 | |||||||||
50 | International Flavors & Fragrances, Inc. | 2,281 | |||||||||
270 | International Paper Co. | 7,066 | |||||||||
109 | MeadWestvaco Corp. | 2,867 | |||||||||
346 | Monsanto Co. | 39,450 | |||||||||
286 | Newmont Mining Corp. | 12,644 | |||||||||
181 | Nucor Corp. | 13,666 | |||||||||
81 | Pactiv Corp.* | 1,927 | |||||||||
105 | PPG Industries, Inc. | 6,444 | |||||||||
198 | Praxair, Inc. | 18,079 | |||||||||
81 | Rohm & Haas Co. | 4,329 | |||||||||
105 | Sealed Air Corp. | 2,655 | |||||||||
83 | Sigma-Aldrich Corp. | 4,733 | |||||||||
64 | Titanium Metals Corp. | 975 | |||||||||
75 | United States Steel Corp. | 11,546 | |||||||||
69 | Vulcan Materials Co. | 4,749 | |||||||||
132 | Weyerhaeuser Co. | 8,432 | |||||||||
273,438 | |||||||||||
Telecommunication Services—3.5% | |||||||||||
256 | American Tower Corp., Class A* | 11,116 | |||||||||
3,811 | AT&T, Inc. | 147,525 | |||||||||
67 | CenturyTel, Inc. | 2,174 | |||||||||
203 | Citizens Communications Co. | 2,176 | |||||||||
99 | Embarq Corp. | 4,115 | |||||||||
23 | Fairpoint Communications, Inc. | 212 | |||||||||
971 | Qwest Communications International, Inc. | 5,010 | |||||||||
1,799 | Sprint Nextel Corp. | 14,374 | |||||||||
1,813 | Verizon Communications, Inc. | 69,764 | |||||||||
291 | Windstream Corp. | 3,416 | |||||||||
259,882 | |||||||||||
Utilities—3.7% | |||||||||||
423 | AES (The) Corp.* | 7,343 | |||||||||
105 | Allegheny Energy, Inc. | 5,649 | |||||||||
135 | Ameren Corp. | 6,124 | |||||||||
253 | American Electric Power Co., Inc. | 11,291 | |||||||||
212 | CenterPoint Energy, Inc. | 3,227 | |||||||||
139 | CMS Energy Corp. | 2,027 | |||||||||
175 | Consolidated Edison, Inc. | 7,280 | |||||||||
112 | Constellation Energy Group, Inc. | 9,481 | |||||||||
363 | Dominion Resources, Inc. | 15,751 | |||||||||
105 | DTE Energy Co. | 4,233 |
See Notes to Financial Statements.
50
Schedule of Investments (Continued)
PowerShares S&P 500 BuyWrite Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
797 | Duke Energy Corp. | $ | 14,593 | ||||||||
320 | Dynegy, Inc., Class A* | 2,758 | |||||||||
205 | Edison International | 10,695 | |||||||||
121 | Entergy Corp. | 13,898 | |||||||||
418 | Exelon Corp. | 35,730 | |||||||||
192 | FirstEnergy Corp. | 14,523 | |||||||||
258 | FPL Group, Inc. | 17,102 | |||||||||
48 | Integrys Energy Group, Inc. | 2,299 | |||||||||
27 | Nicor, Inc. | 948 | |||||||||
174 | NiSource, Inc. | 3,115 | |||||||||
126 | Pepco Holdings, Inc. | 3,139 | |||||||||
225 | PG&E Corp. | 9,000 | |||||||||
65 | Pinnacle West Capital Corp. | 2,206 | |||||||||
235 | PPL Corp. | 11,285 | |||||||||
168 | Progress Energy, Inc. | 7,054 | |||||||||
321 | Public Service Enterprise Group, Inc. | 14,095 | |||||||||
111 | Questar Corp. | 6,885 | |||||||||
165 | Sempra Energy | 9,351 | |||||||||
483 | Southern Co. | 17,981 | |||||||||
130 | TECO Energy, Inc. | 2,081 | |||||||||
277 | Xcel Energy, Inc. | 5,762 | |||||||||
276,906 | |||||||||||
Total Common Stocks and Other Equity Interests (Cost $7,613,211) | 7,628,034 | ||||||||||
Money Market Fund—0.1% | |||||||||||
5,958 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $5,958) | 5,958 | |||||||||
Total Investments (Cost $7,619,169)—101.8% | 7,633,992 | ||||||||||
Liabilities in excess of other assets—(1.8%) | (133,249 | ) | |||||||||
Net Assets—100.0% | $ | 7,500,743 |
* Non-income producing security.
(a) Except as otherwise noted, a portion of all securities in the portfolio are subject to call options written. See Note 2H.
(b) Security not subject to call options written.
See Notes to Financial Statements.
51
Schedule of Investments
PowerShares Value Line Industry Rotation Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Aerospace/Defense—1.3% | |||||||||||
8,179 | Raytheon Co. | $ | 523,211 | ||||||||
Agriculture—1.4% | |||||||||||
9,320 | Universal Corp. | 598,251 | |||||||||
Beverages—3.7% | |||||||||||
9,141 | Coca-Cola (The) Co. | 538,130 | |||||||||
21,694 | Coca-Cola Enterprises, Inc. | 488,115 | |||||||||
15,909 | Green Mountain Coffee Roasters, Inc.* | 512,270 | |||||||||
1,538,515 | |||||||||||
Biotechnology—2.2% | |||||||||||
37,678 | Millennium Pharmaceuticals, Inc.* | 937,052 | |||||||||
Chemicals—5.2% | |||||||||||
7,345 | Agrium Inc (Canada) | 580,254 | |||||||||
4,505 | Monsanto Co. | 513,660 | |||||||||
4,705 | Mosaic (The) Co.* | 576,409 | |||||||||
8,078 | NewMarket Corp. | 524,505 | |||||||||
2,194,828 | |||||||||||
Closed-end Funds—1.3% | |||||||||||
49,282 | DNP Select Income Fund, Inc.** | 539,638 | |||||||||
Coal—1.4% | |||||||||||
9,992 | Arch Coal, Inc. | 573,141 | |||||||||
Commercial Services—4.1% | |||||||||||
8,306 | Apollo Group, Inc., Class A* | 422,775 | |||||||||
11,598 | DeVry, Inc. | 661,086 | |||||||||
9,695 | FTI Consulting, Inc.* | 620,480 | |||||||||
1,704,341 | |||||||||||
Computers—3.8% | |||||||||||
8,424 | IHS, Inc., Class A* | 556,405 | |||||||||
15,853 | Micros Systems, Inc.* | 565,160 | |||||||||
16,007 | Western Digital Corp.* | 464,043 | |||||||||
1,585,608 | |||||||||||
Distribution/Wholesale—1.5% | |||||||||||
29,586 | LKQ Corp.* | 643,791 | |||||||||
Diversified Financial Services—1.2% | |||||||||||
13,238 | Nasdaq Stock Market (The), Inc.* | 482,525 | |||||||||
Electric—1.3% | |||||||||||
9,950 | ITC Holdings, Corp. | 555,011 | |||||||||
Electronics—4.2% | |||||||||||
11,481 | Axsys Technologies, Inc.* | 626,289 | |||||||||
50,565 | Flextronics International Ltd. (Singapore)* | 525,370 | |||||||||
17,716 | FLIR Systems, Inc.* | 608,190 | |||||||||
1,759,849 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Engineering & Construction—2.8% | |||||||||||
4,044 | Fluor Corp. | $ | 618,206 | ||||||||
6,539 | Jacobs Engineering Group, Inc.* | 564,512 | |||||||||
1,182,718 | |||||||||||
Environmental Control—2.6% | |||||||||||
21,815 | American Ecology Corp. | 579,842 | |||||||||
9,633 | Stericycle, Inc.* | 514,210 | |||||||||
1,094,052 | |||||||||||
Food—2.7% | |||||||||||
17,962 | Safeway, Inc. | 567,599 | |||||||||
18,136 | Sysco Corp. | 554,418 | |||||||||
1,122,017 | |||||||||||
Gas—2.8% | |||||||||||
8,547 | Energen Corp. | 583,248 | |||||||||
20,219 | Vectren Corp. | 571,793 | |||||||||
1,155,041 | |||||||||||
Healthcare - Products—2.4% | |||||||||||
1,837 | Intuitive Surgical, Inc.* | 531,371 | |||||||||
10,133 | Varian Medical Systems, Inc.* | 475,035 | |||||||||
1,006,406 | |||||||||||
Healthcare - Services—2.3% | |||||||||||
11,488 | Amedisys, Inc.* | 595,079 | |||||||||
7,731 | Humana, Inc.* | 369,464 | |||||||||
964,543 | |||||||||||
Home Furnishings—2.6% | |||||||||||
25,142 | Matsushita Electric Industrial Company Ltd. ADR (Japan) | 587,569 | |||||||||
11,124 | Sony Corp. ADR (Japan) | 509,368 | |||||||||
1,096,937 | |||||||||||
Insurance—3.8% | |||||||||||
8,460 | AFLAC, Inc. | 564,029 | |||||||||
6,949 | PartnerRe Ltd. | 514,087 | |||||||||
7,737 | Transatlantic Holdings, Inc. | 501,744 | |||||||||
1,579,860 | |||||||||||
Internet—4.3% | |||||||||||
7,589 | Amazon.com, Inc.* | 596,723 | |||||||||
53,341 | eResearch Technology, Inc.* | 649,693 | |||||||||
4,300 | Priceline.com, Inc.* | 548,852 | |||||||||
1,795,268 | |||||||||||
Machinery - Construction & Mining—1.5% | |||||||||||
5,118 | Bucyrus International, Inc., Class A | 644,510 | |||||||||
Machinery - Diversified—3.0% | |||||||||||
30,378 | iRobot Corp.* | 487,263 | |||||||||
7,338 | Lindsay Corp. | 764,033 | |||||||||
1,251,296 |
See Notes to Financial Statements.
52
Schedule of Investments (Continued)
PowerShares Value Line Industry Rotation Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Media—1.0% | |||||||||||
14,737 | Scholastic Corp.* | $ | 414,847 | ||||||||
Metal Fabricate/Hardware—3.9% | |||||||||||
9,225 | Dynamic Materials Corp. | 433,852 | |||||||||
17,774 | Mueller Industries, Inc. | 575,344 | |||||||||
6,499 | Valmont Industries, Inc. | 639,892 | |||||||||
1,649,088 | |||||||||||
Mining—2.1% | |||||||||||
10,763 | Barrick Gold Corp. (Canada) | 415,667 | |||||||||
13,883 | PAN American Silver Corp. (Canada)* | 465,081 | |||||||||
880,748 | |||||||||||
Oil & Gas—7.2% | |||||||||||
4,746 | Apache Corp. | 639,191 | |||||||||
9,621 | Imperial Oil Ltd. (Canada) | 563,213 | |||||||||
6,732 | Murphy Oil Corp. | 608,169 | |||||||||
8,350 | Range Resources Corp. | 554,273 | |||||||||
15,972 | Southwestern Energy Co.* | 675,775 | |||||||||
3,040,621 | |||||||||||
Oil & Gas Services—2.7% | |||||||||||
8,131 | National Oilwell Varco, Inc.* | 556,567 | |||||||||
3,785 | Transocean, Inc.* | 558,136 | |||||||||
1,114,703 | |||||||||||
Packaging & Containers—1.2% | |||||||||||
9,439 | Owens-Illinois, Inc.* | 520,561 | |||||||||
Pharmaceuticals—5.6% | |||||||||||
8,523 | Express Scripts, Inc.* | 596,779 | |||||||||
11,579 | Medco Health Solutions, Inc.* | 573,624 | |||||||||
15,030 | OSI Pharmaceuticals, Inc.* | 520,790 | |||||||||
15,541 | Perrigo Co. | 637,025 | |||||||||
2,328,218 | |||||||||||
Semiconductors—2.3% | |||||||||||
19,037 | ATMI, Inc.* | 560,450 | |||||||||
6,652 | MEMC Electronic Materials, Inc.* | 418,876 | |||||||||
979,326 | |||||||||||
Software—5.1% | |||||||||||
14,001 | Ansys, Inc.* | 563,260 | |||||||||
16,492 | BMC Software, Inc.* | 573,262 | |||||||||
24,708 | Eclipsys Corp.* | 513,185 | |||||||||
30,260 | Informatica Corp.* | 482,950 | |||||||||
2,132,657 | |||||||||||
Telecommunications—2.5% | |||||||||||
22,464 | Corning, Inc. | 600,014 | |||||||||
14,288 | Nokia Oyj ADR (Finland) | 429,640 | |||||||||
1,029,654 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Transportation—3.0% | |||||||||||
10,320 | CSX Corp. | $ | 649,644 | ||||||||
16,639 | Genesee & Wyoming, Inc., Class A* | 593,680 | |||||||||
1,243,324 | |||||||||||
Total Common Stocks (Cost $40,134,369) | 41,862,156 | ||||||||||
Money Market Fund—0.1% | |||||||||||
50,107 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $50,107) | 50,107 | |||||||||
Total Investments (Cost $40,184,476)—100.1% | 41,912,263 | ||||||||||
Liabilities in excess of other assets—(0.1%) | (62,085 | ) | |||||||||
Net Assets—100.0% | $ | 41,850,178 |
ADR American Depository Receipt.
* Non-income producing security
** Closed-end management investment company.
See Notes to Financial Statements.
53
Schedule of Investments
PowerShares Value Line TimelinessTM Select Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.1% | |||||||||||
Consumer Discretionary—10.6% | |||||||||||
27,865 | Deckers Outdoor Corp.* | $ | 3,847,321 | ||||||||
101,043 | Fossil, Inc.* | 3,616,329 | |||||||||
74,719 | GameStop Corp., Class A* | 4,112,533 | |||||||||
160,593 | Matsushita Electric Industrial Co. Ltd. ADR (Japan) | 3,753,058 | |||||||||
27,862 | priceline.com, Inc.* | 3,556,306 | |||||||||
18,885,547 | |||||||||||
Consumer Staples—3.7% | |||||||||||
44,129 | Chattem, Inc.* | 3,083,735 | |||||||||
58,562 | Coca-Cola (The) Co. | 3,447,544 | |||||||||
6,531,279 | |||||||||||
Energy—10.9% | |||||||||||
43,383 | Murphy Oil Corp. | 3,919,220 | |||||||||
53,183 | Range Resources Corp. | 3,530,288 | |||||||||
101,808 | Southwestern Energy Co.* | 4,307,497 | |||||||||
24,466 | Transocean, Inc.* | 3,607,756 | |||||||||
49,881 | Weatherford International Ltd.* | 4,023,900 | |||||||||
19,388,661 | |||||||||||
Financials—5.8% | |||||||||||
53,738 | AFLAC, Inc. | 3,582,712 | |||||||||
167,472 | Charles Schwab (The) Corp. | 3,617,395 | |||||||||
84,788 | Nasdaq OMX (The) Group* | 3,090,523 | |||||||||
10,290,630 | |||||||||||
Health Care—7.6% | |||||||||||
72,138 | Amedisys, Inc.* | 3,736,748 | |||||||||
100,956 | Meridian Bioscience, Inc. | 2,718,745 | |||||||||
97,190 | Perrigo Co. | 3,983,819 | |||||||||
63,759 | Varian Medical Systems, Inc.* | 2,989,022 | |||||||||
13,428,334 | |||||||||||
Industrials—13.8% | |||||||||||
51,074 | AGCO Corp.* | 3,071,080 | |||||||||
87,018 | Copart, Inc.* | 3,556,426 | |||||||||
38,671 | Deere & Co. | 3,251,071 | |||||||||
108,326 | Herman Miller, Inc. | 2,527,246 | |||||||||
40,592 | Jacobs Engineering Group, Inc.* | 3,504,307 | |||||||||
49,125 | Lindsay Corp. | 5,114,894 | |||||||||
65,783 | McDermott International, Inc.* | 3,524,653 | |||||||||
24,549,677 | |||||||||||
Information Technology—32.0% | |||||||||||
89,903 | Amphenol Corp., Class A | 4,151,720 | |||||||||
93,396 | Ansys, Inc.* | 3,757,321 | |||||||||
28,743 | Apple, Inc.* | 4,999,844 | |||||||||
105,408 | BMC Software, Inc.* | 3,663,982 | |||||||||
7,072 | Google, Inc., Class A* | 4,061,379 | |||||||||
31,262 | International Business Machines Corp. | 3,773,323 | |||||||||
79,008 | Mantech International Corp., Class A* | 3,774,212 | |||||||||
42,272 | MEMC Electronic Materials, Inc. * | 2,661,868 | |||||||||
101,972 | Micros Systems, Inc.* | 3,635,302 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
123,621 | Microsoft Corp. | $ | 3,525,671 | ||||||||
92,640 | Nokia Oyj ADR (Finland) | 2,785,685 | |||||||||
181,423 | Oracle Corp.* | 3,782,670 | |||||||||
31,658 | Research In Motion Ltd. (Canada)* | 3,850,563 | |||||||||
100,718 | Sigma Designs, Inc.* | 1,800,838 | |||||||||
136,032 | SRA International, Inc., Class A* | 3,573,561 | |||||||||
103,726 | Western Digital Corp.* | 3,007,017 | |||||||||
56,804,956 | |||||||||||
Materials—11.8% | |||||||||||
46,325 | Agrium, Inc. (Canada) | 3,659,675 | |||||||||
73,397 | E.I. du Pont de Nemours & Co. | 3,589,847 | |||||||||
28,229 | Monsanto Co. | 3,218,671 | |||||||||
29,402 | Mosaic (The) Co.* | 3,602,039 | |||||||||
90,354 | Pan American Silver Corp. (Canada)* | 3,026,859 | |||||||||
20,947 | Potash Corp. of Saskatchewan (Canada) | 3,853,201 | |||||||||
20,950,292 | |||||||||||
Telecommunications Services—1.9% | |||||||||||
39,834 | Telefonica SA ADR (Spain) | 3,440,861 | |||||||||
Utilities—2.0% | |||||||||||
63,379 | ITC Holdings Corp. | 3,535,281 | |||||||||
Total Investments (Cost $174,544,342)—100.1% | 177,805,518 | ||||||||||
Liabilities in excess of other assets—(0.1%) | (136,932 | ) | |||||||||
Net Assets—100.0% | $ | 177,668,586 |
ADR American Depositary Receipt.
* Non-income producing security.
See Notes to Financial Statements.
54
Schedule of Investments
PowerShares Water Resources Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.7% | |||||||||||
Biotechnology—2.8% | |||||||||||
882,817 | Millipore Corp.* | $ | 61,885,472 | ||||||||
Electrical Components & Equipment—3.0% | |||||||||||
1,249,953 | Emerson Electric Co. | 65,322,544 | |||||||||
Electronics—13.4% | |||||||||||
2,865,625 | Agilent Technologies, Inc.* | 86,570,532 | |||||||||
1,303,518 | Badger Meter, Inc.(a) | 67,874,182 | |||||||||
906,862 | Itron, Inc.* | 84,410,715 | |||||||||
2,018,344 | Watts Water Technologies, Inc., Class A(a) | 54,232,903 | |||||||||
293,088,332 | |||||||||||
Engineering & Construction—15.0% | |||||||||||
3,771,250 | Aecom Technology Corp.* | 103,558,525 | |||||||||
2,469,676 | Insituform Technologies, Inc., Class A*(a) | 41,786,918 | |||||||||
1,652,447 | Layne Christensen Co.*(a) | 70,509,913 | |||||||||
2,800,775 | URS Corp.* | 112,983,264 | |||||||||
328,838,620 | |||||||||||
Environmental Control—9.8% | |||||||||||
3,594,994 | Calgon Carbon Corp.*(a) | 51,228,665 | |||||||||
2,728,689 | Nalco Holding Co. | 62,732,560 | |||||||||
4,799,496 | Tetra Tech, Inc.*(a) | 101,413,350 | |||||||||
215,374,575 | |||||||||||
Hand/Machine Tools—2.9% | |||||||||||
1,624,345 | Franklin Electric Co., Inc.(a) | 62,894,638 | |||||||||
Machinery - Diversified—12.6% | |||||||||||
1,545,240 | Gorman-Rupp (The) Co.(a) | 54,129,757 | |||||||||
1,946,394 | IDEX Corp. | 71,413,196 | |||||||||
869,685 | Lindsay Corp.(a) | 90,551,603 | |||||||||
990,403 | Roper Industries, Inc. | 61,523,834 | |||||||||
277,618,390 | |||||||||||
Metal Fabricate/Hardware—7.3% | |||||||||||
6,925,148 | Mueller Water Products, Inc., Class B(a) | 54,985,675 | |||||||||
1,068,774 | Valmont Industries, Inc. | 105,231,488 | |||||||||
160,217,163 | |||||||||||
Miscellaneous Manufacturing—21.8% | |||||||||||
704,244 | Ameron International Corp.(a) | 69,579,307 | |||||||||
1,112,768 | Danaher Corp. | 86,818,160 | |||||||||
1,735,016 | General Electric Co. | 56,735,023 | |||||||||
1,128,140 | ITT Corp. | 72,200,960 | |||||||||
1,571,291 | Pall Corp. | 54,633,788 | |||||||||
1,870,490 | Pentair, Inc. | 68,890,147 | |||||||||
594,805 | Siemens AG ADR (Germany) | 70,454,652 | |||||||||
479,312,037 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Water—11.1% | |||||||||||
573,634 | American States Water Co. | $ | 20,088,663 | ||||||||
1,144,962 | Aqua America, Inc. | 21,101,650 | |||||||||
539,846 | California Water Service Group | 20,892,040 | |||||||||
478,489 | Companhia de Saneamento Basico do Estado de Sao Paulo ADR (Brazil) | 24,225,898 | |||||||||
911,139 | Consolidated Water Co., Inc. (Cayman Islands)(a) | 21,593,994 | |||||||||
676,119 | SJW Corp. | 20,330,898 | |||||||||
1,939,749 | Southwest Water Co.(a) | 21,608,804 | |||||||||
1,301,342 | Veolia Environnement ADR (France) | 94,282,228 | |||||||||
244,124,175 | |||||||||||
Total Common Stocks (Cost $2,064,927,588) | 2,188,675,946 | ||||||||||
Money Market Fund—0.0% | |||||||||||
678,721 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $678,721) | 678,721 | |||||||||
Total Investments (Cost $2,065,606,309)—99.7% | 2,189,354,667 | ||||||||||
Other assets less liabilities—0.3% | 7,297,507 | ||||||||||
Net Assets—100.0% | $ | 2,196,652,174 |
ADR American Depositary Receipt.
* Non-income producing security.
(a) Affiliated Investment. See Note 4.
See Notes to Financial Statements.
55
Schedule of Investments
PowerShares WilderHill Clean Energy Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.8% | |||||||||||
Auto Parts & Equipment—3.2% | |||||||||||
1,614,579 | Amerigon, Inc.*(a) | $ | 23,702,020 | ||||||||
1,298,370 | Fuel Systems Solutions, Inc.*(a) | 24,240,568 | |||||||||
47,942,588 | |||||||||||
Chemicals—7.6% | |||||||||||
359,063 | Air Products & Chemicals, Inc. | 35,342,571 | |||||||||
603,251 | OM Group, Inc.* | 33,034,025 | |||||||||
1,636,289 | Zoltek Cos., Inc.*(a) | 43,639,827 | |||||||||
112,016,423 | |||||||||||
Computers—3.7% | |||||||||||
3,162,972 | Echelon Corp.*(a) | 35,615,065 | |||||||||
1,743,354 | Maxwell Technologies, Inc.*(a) | 18,601,587 | |||||||||
54,216,652 | |||||||||||
Electric—11.1% | |||||||||||
1,927,458 | Calpine Corp.* | 37,970,923 | |||||||||
1,139,223 | IDACORP, Inc. | 36,956,394 | |||||||||
1,044,164 | Ormat Technologies, Inc. | 51,477,285 | |||||||||
1,543,390 | Portland General Electric Co. | 37,041,360 | |||||||||
163,445,962 | |||||||||||
Electrical Components & Equipment—12.4% | |||||||||||
4,538,982 | Active Power, Inc.*(a) | 6,173,016 | |||||||||
1,595,042 | American Superconductor Corp.* | 40,322,662 | |||||||||
4,711,871 | China BAK Battery, Inc.*(a) | 17,528,160 | |||||||||
1,283,282 | Energy Conversion Devices, Inc.* | 41,822,160 | |||||||||
2,876,020 | Medis Technologies Ltd.*(a) | 24,129,808 | |||||||||
1,358,261 | Ultralife Batteries, Inc.*(a) | 13,990,088 | |||||||||
2,631,249 | Universal Display Corp.*(a) | 38,916,173 | |||||||||
182,882,067 | |||||||||||
Electronics—2.6% | |||||||||||
404,710 | Itron, Inc.* | 37,670,407 | |||||||||
Energy - Alternate Sources—40.5% | |||||||||||
637,281 | Ascent Solar Technologies, Inc.* | 10,228,360 | |||||||||
6,348,323 | Ballard Power Systems, Inc. (Canada)*(a) | 26,726,440 | |||||||||
1,632,807 | Comverge, Inc.*(a) | 21,422,428 | |||||||||
5,081,391 | Evergreen Solar, Inc.* | 43,649,149 | |||||||||
195,874 | First Solar, Inc.* | 57,193,249 | |||||||||
4,120,503 | FuelCell Energy, Inc.*(a) | 36,384,041 | |||||||||
2,752,219 | Gushan Environmental Energy Ltd. ADR (China) | 34,402,738 | |||||||||
2,436,986 | JA Solar Holdings Co. Ltd. ADR (China)* | 58,512,033 | |||||||||
4,433,704 | Nova Biosource Fuels, Inc.* | 5,054,423 | |||||||||
407,112 | Ocean Power Technologies, Inc.* | 3,961,200 | |||||||||
3,615,474 | Pacific Ethanol, Inc.*(a) | 12,401,076 | |||||||||
7,812,425 | Plug Power, Inc.*(a) | 25,234,133 | |||||||||
599,305 | SunPower Corp., Class A* | 52,301,347 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
1,165,729 | Suntech Power Holdings Co. Ltd. ADR (China)* | $ | 52,143,058 | ||||||||
1,400,946 | Trina Solar Ltd. ADR (Cayman Islands)* | 59,091,902 | |||||||||
4,310,807 | VeraSun Energy Corp.* | 26,899,436 | |||||||||
5,616,251 | Verenium Corp.*(a) | 16,848,753 | |||||||||
2,488,236 | Yingli Green Energy Holding Co. Ltd. ADR (China)* | 54,815,839 | |||||||||
597,269,605 | |||||||||||
Food—2.4% | |||||||||||
2,728,711 | Cosan Ltd., Class A (Brazil)* | 36,182,708 | |||||||||
Machinery - Diversified—1.2% | |||||||||||
1,588,661 | Raser Technologies, Inc.* | 17,252,858 | |||||||||
Semiconductors—15.1% | |||||||||||
1,888,834 | Applied Materials, Inc. | 35,245,642 | |||||||||
1,252,581 | Cree, Inc.* | 32,567,106 | |||||||||
4,643,967 | Emcore Corp.*(a) | 28,699,716 | |||||||||
1,716,859 | International Rectifier Corp.* | 39,075,711 | |||||||||
532,511 | MEMC Electronic Materials, Inc.* | 33,532,217 | |||||||||
1,984,093 | Renesola Ltd. ADR (British Virgin Islands)* | 33,233,558 | |||||||||
763,166 | Rubicon Technology, Inc.* | 16,835,442 | |||||||||
238,228 | Spire Corp.* | 3,180,344 | |||||||||
222,369,736 | |||||||||||
Total Investments (Cost $1,656,552,305)—99.8% | 1,471,249,006 | ||||||||||
Other assets less liabilities—0.2% | 2,643,816 | ||||||||||
Net Assets—100.0% | $ | 1,473,892,822 |
ADR American Depositary Receipt.
* Non-income producing security.
(a) Affiliated Investment. See Note 4.
The fund has holdings greater than 10% of net assets in the following country:
China | 13.6 | % |
See Notes to Financial Statements.
56
Schedule of Investments
PowerShares WilderHill Progressive Energy Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Aerospace/Defense—2.4% | |||||||||||
20,798 | United Technologies Corp. | $ | 1,507,231 | ||||||||
Agriculture—3.2% | |||||||||||
43,632 | Andersons (The), Inc. | 1,983,074 | |||||||||
Auto Parts & Equipment—7.6% | |||||||||||
116,951 | Exide Technologies* | 1,706,315 | |||||||||
41,866 | Johnson Controls, Inc. | 1,476,195 | |||||||||
59,248 | Tenneco, Inc.* | 1,515,564 | |||||||||
4,698,074 | |||||||||||
Chemicals—8.5% | |||||||||||
69,137 | Methanex Corp. (Canada) | 1,621,954 | |||||||||
18,604 | Praxair, Inc. | 1,698,731 | |||||||||
68,456 | Sociedad Quimica y Minera de Chile S.A. ADR (Chile) | 1,951,681 | |||||||||
5,272,366 | |||||||||||
Electric—10.5% | |||||||||||
19,631 | A-Power Energy Generation Systems Ltd.* | 309,581 | |||||||||
27,686 | CPFL Energia S.A. ADR (Brazil) | 2,051,533 | |||||||||
25,876 | EnerNOC, Inc.* | 399,008 | |||||||||
103,286 | Enersis S.A. ADR (Chile) | 1,950,040 | |||||||||
27,712 | FPL Group, Inc. | 1,837,028 | |||||||||
6,547,190 | |||||||||||
Electrical Components & Equipment—8.0% | |||||||||||
17,147 | Energizer Holdings, Inc.* | 1,355,642 | |||||||||
65,247 | EnerSys* | 1,526,780 | |||||||||
90,483 | GrafTech International Ltd.* | 1,777,990 | |||||||||
24,029 | PowerSecure International, Inc.* | 292,193 | |||||||||
4,952,605 | |||||||||||
Electronics—6.2% | |||||||||||
96,289 | AU Optronics Corp. ADR (Taiwan, Republic of China) | 1,879,561 | |||||||||
37,206 | Badger Meter, Inc. | 1,937,317 | |||||||||
3,816,878 | |||||||||||
Energy-Alternate Sources—8.4% | |||||||||||
55,046 | Aventine Renewable Energy Holdings, Inc.* | 241,652 | |||||||||
146,235 | Clean Energy Fuels Corp.* | 1,903,980 | |||||||||
52,378 | Covanta Holding Corp.* | 1,394,826 | |||||||||
194,325 | Evergreen Energy, Inc.* | 285,658 | |||||||||
120,994 | Headwaters, Inc.* | 1,382,961 | |||||||||
5,209,077 | |||||||||||
Environmental Control—6.6% | |||||||||||
72,335 | EnergySolutions, Inc. | 1,580,520 | |||||||||
82,953 | Fuel Tech, Inc.* | 2,131,892 | |||||||||
325,332 | Rentech, Inc.* | 409,918 | |||||||||
4,122,330 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Hand/Machine Tools—3.0% | |||||||||||
56,931 | Baldor Electric Co. | $ | 1,844,564 | ||||||||
Investment Companies—0.5% | |||||||||||
41,661 | Harris & Harris Group, Inc.* | 331,205 | |||||||||
Mining—7.3% | |||||||||||
56,359 | Cameco Corp. (Canada) | 1,972,001 | |||||||||
43,541 | Uranium Resources, Inc.* | 259,504 | |||||||||
500,078 | USEC, Inc.* | 2,320,363 | |||||||||
4,551,868 | |||||||||||
Miscellaneous Manufacturing—7.6% | |||||||||||
17,612 | Eaton Corp. | 1,547,038 | |||||||||
70,586 | Hexcel Corp.* | 1,579,715 | |||||||||
13,358 | Siemens AG ADR (Germany) | 1,582,255 | |||||||||
4,709,008 | |||||||||||
Oil & Gas—16.8% | |||||||||||
40,758 | Chesapeake Energy Corp. | 2,107,189 | |||||||||
33,765 | Questar Corp. | 2,094,443 | |||||||||
30,016 | Range Resources Corp. | 1,992,462 | |||||||||
32,039 | Sasol Ltd. ADR (South Africa) | 1,815,009 | |||||||||
57,587 | Southwestern Energy Co.* | 2,436,506 | |||||||||
10,445,609 | |||||||||||
Semiconductors—0.4% | |||||||||||
33,358 | O2Micro International Ltd. ADR (Cayman Islands)* | 253,187 | |||||||||
Telecommunications—3.0% | |||||||||||
68,684 | Corning, Inc. | 1,834,550 | |||||||||
Total Common Stocks (Cost $60,096,938) | 62,078,816 | ||||||||||
Money Market Fund—0.1% | |||||||||||
90,692 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $90,692) | 90,692 | |||||||||
Total Investments (Cost $60,187,630)—100.1% | 62,169,508 | ||||||||||
Liabilities in excess of other assets—(0.1%) | (72,070 | ) | |||||||||
Net Assets—100.0% | $ | 62,097,438 |
ADR American Depositary Receipt.
* Non-income producing security.
See Notes to Financial Statements.
57
Statements of Assets and Liabilities
April 30, 2008
PowerShares Aerospace & Defense Portfolio | PowerShares CleantechTM Portfolio | PowerShares DWA Technical Leaders Portfolio | PowerShares Golden Dragon Halter USX China Portfolio | PowerShares Listed Private Equity Portfolio | PowerShares Lux Nanotech Portfolio | ||||||||||||||||||||||
ASSETS: | |||||||||||||||||||||||||||
Unaffiliated investments at value | $ | 257,190,524 | $ | 114,369,216 | $ | 363,586,621 | $ | 526,791,170 | $ | 102,740,258 | $ | 67,011,176 | |||||||||||||||
Affiliated investments at value | — | — | — | — | — | 17,021,735 | |||||||||||||||||||||
Cash | 412,866 | 64,679 | 144,034 | 54,903 | 375,654 | 460,964 | |||||||||||||||||||||
Receivables: | |||||||||||||||||||||||||||
Dividends | 63,887 | 10,971 | 98,166 | 1,945,039 | 23,097 | 13,334 | |||||||||||||||||||||
Shares sold | — | — | 10,545,416 | 2,850,777 | 2,041,332 | — | |||||||||||||||||||||
Expense waivers due from Adviser | 8,120 | 21 | — | 26,408 | — | 7,241 | |||||||||||||||||||||
Investments sold | — | — | — | 5,753,048 | 323,822 | — | |||||||||||||||||||||
Total Assets | 257,675,397 | 114,444,887 | 374,374,237 | 537,421,345 | 105,504,163 | 84,514,450 | |||||||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||||||
Due to custodian | — | — | — | — | — | — | |||||||||||||||||||||
Payables: | |||||||||||||||||||||||||||
Investments purchased | — | — | 10,549,749 | 2,850,888 | 2,015,447 | — | |||||||||||||||||||||
Shares repurchased | — | — | — | 5,754,200 | — | — | |||||||||||||||||||||
Expense recapture due to Adviser | — | — | 61,429 | — | 13,878 | — | |||||||||||||||||||||
Open written options, at value (premium received $144,450) | — | — | — | — | — | — | |||||||||||||||||||||
Accrued advisory fees | 102,262 | 45,649 | 138,429 | 196,887 | 40,372 | 35,439 | |||||||||||||||||||||
Accrued expenses | 77,670 | 62,931 | 110,826 | 136,369 | 55,283 | 50,796 | |||||||||||||||||||||
Total Liabilities | 179,932 | 108,580 | 10,860,433 | 8,938,344 | 2,124,980 | 86,235 | |||||||||||||||||||||
NET ASSETS | $ | 257,495,465 | $ | 114,336,307 | $ | 363,513,804 | $ | 528,483,001 | $ | 103,379,183 | $ | 84,428,215 | |||||||||||||||
NET ASSETS CONSIST OF: | |||||||||||||||||||||||||||
Shares of beneficial interest | $ | 283,744,451 | $ | 118,767,623 | $ | 378,936,539 | $ | 624,025,253 | $ | 148,479,279 | $ | 127,448,108 | |||||||||||||||
Undistributed net investment income (loss) | 215,472 | — | — | — | 1,142,260 | — | |||||||||||||||||||||
Accumulated net realized gain (loss) on investments | (9,707,030 | ) | (5,860,791 | ) | (31,367,633 | ) | (27,397,621 | ) | (10,563,018 | ) | (18,224,782 | ) | |||||||||||||||
Net unrealized appreciation (depreciation) on investments | (16,757,428 | ) | 1,429,475 | 15,944,898 | (68,144,631 | ) | (35,679,338 | ) | (24,795,111 | ) | |||||||||||||||||
Net Assets | $ | 257,495,465 | $ | 114,336,307 | $ | 363,513,804 | $ | 528,483,001 | $ | 103,379,183 | $ | 84,428,215 | |||||||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 12,300,000 | 3,400,000 | 14,000,000 | 18,300,000 | 5,100,000 | 6,000,000 | |||||||||||||||||||||
Net asset value | $ | 20.93 | $ | 33.63 | $ | 25.97 | $ | 28.88 | $ | 20.27 | $ | 14.07 | |||||||||||||||
Unaffiliated investments at cost | $ | 273,947,952 | $ | 112,939,741 | $ | 347,641,723 | $ | 594,935,801 | $ | 138,419,596 | $ | 88,303,766 | |||||||||||||||
Affiliated investments at cost | — | — | — | — | — | $ | 20,524,256 |
See Notes to Financial Statements.
58
PowerShares S&P 500 BuyWrite Portfolio | PowerShares Value Line Industry Rotation Portfolio | PowerShares Value Line TimelinessTM Select Portfolio | PowerShares Water Resources Portfolio | PowerShares WilderHill Clean Energy Portfolio | PowerShares WilderHill Progressive Energy Portfolio | ||||||||||||||||||||||
ASSETS: | |||||||||||||||||||||||||||
Unaffiliated investments at value | $ | 7,633,992 | $ | 41,912,263 | $ | 177,805,518 | $ | 1,426,964,958 | $ | 1,056,996,107 | $ | 62,169,508 | |||||||||||||||
Affiliated investments at value | — | — | — | 762,389,709 | 414,252,899 | — | |||||||||||||||||||||
Cash | 6,928 | — | — | 5,082,046 | 1,632,155 | — | |||||||||||||||||||||
Receivables: | |||||||||||||||||||||||||||
Dividends | 4,967 | 12,520 | 55,286 | 1,673,966 | 473,356 | 87,055 | |||||||||||||||||||||
Shares sold | 2,502,380 | — | — | 14,551,366 | 10,547,681 | — | |||||||||||||||||||||
Expense waivers due from Adviser | — | — | 11,596 | 75,183 | 90,756 | — | |||||||||||||||||||||
Investments sold | — | — | 3,377,193 | — | — | — | |||||||||||||||||||||
Total Assets | 10,148,267 | 41,924,783 | 181,249,593 | 2,210,737,228 | 1,483,992,954 | 62,256,563 | |||||||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||||||
Due to custodian | — | 12,736 | 50,739 | — | — | 75,025 | |||||||||||||||||||||
Payables: | |||||||||||||||||||||||||||
Investments purchased | 2,542,598 | — | — | 12,751,648 | 9,105,295 | — | |||||||||||||||||||||
Shares repurchased | — | — | 3,376,604 | — | — | — | |||||||||||||||||||||
Expense recapture due to Adviser | — | 1,872 | — | — | — | 5,162 | |||||||||||||||||||||
Open written options, at value (premium received $144,450) | 101,871 | — | — | — | — | — | |||||||||||||||||||||
Accrued advisory fees | 3,055 | 16,911 | 74,380 | 867,308 | 606,500 | 24,502 | |||||||||||||||||||||
Accrued expenses | — | 43,086 | 79,284 | 466,098 | 388,337 | 54,436 | |||||||||||||||||||||
Total Liabilities | 2,647,524 | 74,605 | 3,581,007 | 14,085,054 | 10,100,132 | 159,125 | |||||||||||||||||||||
NET ASSETS | $ | 7,500,743 | $ | 41,850,178 | $ | 177,668,586 | $ | 2,196,652,174 | $ | 1,473,892,822 | $ | 62,097,438 | |||||||||||||||
NET ASSETS CONSIST OF: | |||||||||||||||||||||||||||
Shares of beneficial interest | $ | 7,419,561 | $ | 47,203,780 | $ | 244,397,040 | $ | 2,154,848,340 | $ | 1,860,605,397 | $ | 65,085,798 | |||||||||||||||
Undistributed net investment income (loss) | 3,126 | — | — | 229,824 | — | — | |||||||||||||||||||||
Accumulated net realized gain (loss) on investments | 20,654 | (7,081,389 | ) | (69,989,630 | ) | (82,174,348 | ) | (201,409,276 | ) | (4,970,238 | ) | ||||||||||||||||
Net unrealized appreciation (depreciation) on investments | 57,402 | 1,727,787 | 3,261,176 | 123,748,358 | (185,303,299 | ) | 1,981,878 | ||||||||||||||||||||
Net Assets | $ | 7,500,743 | $ | 41,850,178 | $ | 177,668,586 | $ | 2,196,652,174 | $ | 1,473,892,822 | $ | 62,097,438 | |||||||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 300,000 | 1,500,000 | 10,600,000 | 106,300,000 | 70,400,000 | �� | 2,200,000 | ||||||||||||||||||||
Net asset value | $ | 25.00 | $ | 27.90 | $ | 16.76 | $ | 20.66 | $ | 20.94 | $ | 28.23 | |||||||||||||||
Unaffiliated investments at cost | $ | 7,619,169 | $ | 40,184,476 | $ | 174,544,342 | $ | 1,394,286,337 | $ | 1,047,393,824 | $ | 60,187,630 | |||||||||||||||
Affiliated investments at cost | — | — | — | $ | 671,319,972 | $ | 609,158,481 | — |
59
Statements of Operations
PowerShares Aerospace & Defense Portfolio | PowerShares CleantechTM Portfolio | PowerShares DWA Technical Leaders Portfolio | PowerShares Golden Dragon Halter USX China Portfolio | PowerShares Listed Private Equity Portfolio | PowerShares Lux Nanotech Portfolio | ||||||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | ||||||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||||||
Unaffiliated dividend income | $ | 2,818,995 | $ | 296,231 | $ | 1,376,077 | $ | 6,740,425 | $ | 7,757,917 | $ | 670,904 | |||||||||||||||
Affiliated dividend income | 3,210 | 19 | 202 | 3,211 | 23,157 | — | |||||||||||||||||||||
Foreign withholding taxes | (1,311 | ) | (14,940 | ) | — | (7,889 | ) | — | (473 | ) | |||||||||||||||||
Total Income | 2,820,894 | 281,310 | 1,376,279 | 6,735,747 | 7,781,074 | 670,431 | |||||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||||||
Advisory fees | 1,520,817 | 365,806 | 1,080,236 | 3,029,609 | 676,065 | 629,641 | |||||||||||||||||||||
Sub-licensing | 182,497 | 54,871 | 216,047 | 557,983 | 135,213 | 125,928 | |||||||||||||||||||||
Administration & Accounting fees | 91,203 | 78,681 | 84,570 | 170,963 | 76,692 | 80,738 | |||||||||||||||||||||
Printing | 52,133 | 12,798 | 5,711 | 94,895 | 18,500 | 17,405 | |||||||||||||||||||||
Custodian & transfer agent fees | 19,218 | 7,182 | 13,750 | 34,367 | 9,532 | 9,449 | |||||||||||||||||||||
Audit | 15,848 | 15,848 | 16,006 | 15,848 | 15,848 | 15,848 | |||||||||||||||||||||
Trustees | 12,864 | 6,176 | 9,498 | 21,897 | 8,402 | 7,874 | |||||||||||||||||||||
Legal | 11,672 | — | 12,379 | 19,568 | — | 5,136 | |||||||||||||||||||||
Listing fee and expenses | 8,743 | 45 | 2,500 | 8,470 | 243 | 8,652 | |||||||||||||||||||||
Registration & filings | 632 | 1,805 | 7,287 | — | 494 | — | |||||||||||||||||||||
Offering costs | — | 13,432 | 17,758 | — | 18,126 | — | |||||||||||||||||||||
Other expenses | 23,080 | 7,702 | 11,409 | 35,536 | 13,604 | 20,528 | |||||||||||||||||||||
Total Expenses | 1,938,707 | 564,346 | 1,477,151 | 3,989,136 | 972,719 | 921,199 | |||||||||||||||||||||
(Waivers) and/or Recapture | 68,771 | (57,076 | ) | 52,829 | 204,381 | (8,102 | ) | (39,701 | ) | ||||||||||||||||||
Net Expenses | 2,007,478 | 507,270 | 1,529,980 | 4,193,517 | 964,617 | 881,498 | |||||||||||||||||||||
Net Investment Income (Loss) | 813,416 | (225,960 | ) | (153,701 | ) | 2,542,230 | 6,816,457 | (211,067 | ) | ||||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||||||||||||||
Net realized gain (loss) from: | |||||||||||||||||||||||||||
Investments | (6,746,467 | ) | (4,816,213 | ) | (31,306,112 | ) | (21,250,942 | ) | (10,463,110 | ) | (11,561,780 | ) | |||||||||||||||
Written options | — | — | — | — | — | — | |||||||||||||||||||||
In-kind redemptions | 38,035,868 | 12,021,651 | 11,599,036 | 246,564,038 | 4,669,362 | 6,523,699 | |||||||||||||||||||||
Net realized gain (loss) | 31,289,401 | 7,205,438 | (19,707,076 | ) | 225,313,096 | (5,793,748 | ) | (5,038,081 | ) | ||||||||||||||||||
Net change in unrealized appreciation (depreciation) Investments | (37,436,934 | ) | 423,812 | 13,955,713 | (101,212,578 | ) | (40,433,048 | ) | (20,211,100 | ) | |||||||||||||||||
Written options | — | — | — | — | — | — | |||||||||||||||||||||
Net change in unrealized appreciation (depreciation) | (37,436,934 | ) | 423,812 | 13,955,713 | (101,212,578 | ) | (40,433,048 | ) | (20,211,100 | ) | |||||||||||||||||
Net realized and unrealized gain (loss) | (6,147,533 | ) | 7,629,250 | (5,751,363 | ) | 124,100,518 | (46,226,796 | ) | (25,249,181 | ) | |||||||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | (5,334,117 | ) | $ | 7,403,290 | $ | (5,905,064 | ) | $ | 126,642,748 | $ | (39,410,339 | ) | $ | (25,460,248 | ) |
* Commencement of Investment Operations.
See Notes to Financial Statements.
60
PowerShares S&P 500 BuyWrite Portfolio | PowerShares Value Line Industry Rotation Portfolio | PowerShares Value Line TimelinessTM Select Portfolio | PowerShares Water Resources Portfolio | PowerShares WilderHill Clean Energy Portfolio | PowerShares WilderHill Progressive Energy Portfolio | ||||||||||||||||||||||
For the Period December 19, 2007* Through April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | Year Ended April 30, 2008 | ||||||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||||||
Unaffiliated dividend income | $ | 22,744 | $ | 297,012 | $ | 1,217,901 | $ | 16,657,954 | $ | 4,395,702 | $ | 513,967 | |||||||||||||||
Affiliated dividend income | 2 | 2,173 | — | 4,376,434 | — | 1,757 | |||||||||||||||||||||
Foreign withholding taxes | — | (2,298 | ) | (14,935 | ) | (832,462 | ) | (8,456 | ) | (12,816 | ) | ||||||||||||||||
Total Income | 22,746 | 296,887 | 1,202,966 | 20,201,926 | 4,387,246 | 502,908 | |||||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||||||
Advisory fees | 9,120 | 196,061 | 1,031,063 | 9,835,346 | 6,231,276 | 243,806 | |||||||||||||||||||||
Sub-licensing | — | 39,212 | 206,213 | 1,475,303 | 1,252,086 | 48,761 | |||||||||||||||||||||
Administration & Accounting fees | — | 80,541 | 80,738 | 561,440 | 354,333 | 78,771 | |||||||||||||||||||||
Printing | — | 6,674 | 17,593 | 261,493 | 251,199 | 4,908 | |||||||||||||||||||||
Custodian & transfer agent fees | — | 6,415 | 13,933 | 104,262 | 67,493 | 6,321 | |||||||||||||||||||||
Audit | — | 16,006 | 15,848 | 15,848 | 15,848 | 15,848 | |||||||||||||||||||||
Trustees | — | 5,455 | 10,479 | 55,020 | 36,361 | 5,693 | |||||||||||||||||||||
Legal | — | — | 8,002 | 71,333 | 39,952 | — | |||||||||||||||||||||
Listing fee and expenses | — | 1,907 | 28,247 | 10,605 | 11,628 | 46 | |||||||||||||||||||||
Registration & filings | — | 455 | — | 2,115 | 12,483 | 641 | |||||||||||||||||||||
Offering costs | — | 11,145 | — | — | — | 14,563 | |||||||||||||||||||||
Other expenses | — | 8,253 | 26,384 | 93,203 | 63,229 | 7,758 | |||||||||||||||||||||
Total Expenses | 9,120 | 372,124 | 1,438,500 | 12,485,968 | 8,335,888 | 427,116 | |||||||||||||||||||||
(Waivers) and/or Recapture | — | (86,494 | ) | 4,989 | 139,671 | (7,102 | ) | (71,221 | ) | ||||||||||||||||||
Net Expenses | 9,120 | 285,630 | 1,443,489 | 12,625,639 | 8,328,786 | 355,895 | |||||||||||||||||||||
Net Investment Income (Loss) | 13,626 | 11,257 | (240,523 | ) | 7,576,287 | (3,941,540 | ) | 147,013 | |||||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||||||||||||||
Net realized gain (loss) from: | |||||||||||||||||||||||||||
Investments | (10,604 | ) | (6,701,862 | ) | (34,836,406 | ) | (50,593,133 | ) | (73,344,816 | ) | (4,847,974 | ) | |||||||||||||||
Written options | 31,258 | — | — | — | — | — | |||||||||||||||||||||
In-kind redemptions | — | 6,145,696 | 44,586,258 | 163,299,854 | 294,335,763 | 2,781,985 | |||||||||||||||||||||
Net realized gain (loss) | 20,654 | (556,166 | ) | 9,749,852 | 112,706,721 | 220,990,947 | (2,065,989 | ) | |||||||||||||||||||
Net change in unrealized appreciation (depreciation) Investments | 14,823 | (11,149 | ) | (20,623,471 | ) | (5,048 | ) | (213,773,816 | ) | 144,615 | |||||||||||||||||
Written options | 42,579 | — | — | — | — | — | |||||||||||||||||||||
Net change in unrealized appreciation (depreciation) | 57,402 | (11,149 | ) | (20,623,471 | ) | (5,048 | ) | (213,773,816 | ) | 144,615 | |||||||||||||||||
Net realized and unrealized gain (loss) | 78,056 | (567,315 | ) | (10,873,619 | ) | 112,701,673 | 7,217,131 | (1,921,374 | ) | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | 91,682 | $ | (556,058 | ) | $ | (11,114,142 | ) | $ | 120,277,960 | $ | 3,275,591 | $ | (1,774,361 | ) |
61
Statements of Changes in Net Assets
PowerShares Aerospace & Defense Portfolio | PowerShares CleantechTM Portfolio | PowerShares DWA Technical Leaders Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | For the Period October 24, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period March 1, 2007* Through April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | 813,416 | $ | 329,993 | $ | (225,960 | ) | $ | (39,832 | ) | $ | (153,701 | ) | $ | 105,514 | ||||||||||||
Net realized gain (loss) on investments | 31,289,401 | 8,592,051 | 7,205,438 | 1,087,661 | (19,707,076 | ) | 66,278 | ||||||||||||||||||||
Net change in unrealized appreciation (depreciation) of investments | (37,436,934 | ) | 12,375,809 | 423,812 | 1,005,663 | 13,955,713 | 1,989,185 | ||||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (5,334,117 | ) | 21,297,853 | 7,403,290 | 2,053,492 | (5,905,064 | ) | 2,160,977 | |||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 15,071 | 13,857 | (192,676 | ) | 6,280 | 610,622 | 177,364 | ||||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (597,944 | ) | (362,663 | ) | — | — | (105,514 | ) | — | ||||||||||||||||||
Return of capital | — | (25,620 | ) | — | — | (57,242 | ) | — | |||||||||||||||||||
Total distributions to shareholders | (597,944 | ) | (388,283 | ) | — | — | (162,756 | ) | — | ||||||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 306,615,261 | 149,636,041 | 121,607,209 | 48,140,438 | 469,242,076 | 92,402,327 | |||||||||||||||||||||
Value of shares repurchased | (245,073,856 | ) | (53,795,021 | ) | (36,337,012 | ) | (28,531,110 | ) | (191,750,748 | ) | (2,473,008 | ) | |||||||||||||||
Net income equalization | (15,071 | ) | (13,857 | ) | 192,676 | (6,280 | ) | (610,622 | ) | (177,364 | ) | ||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 61,526,334 | 95,827,163 | 85,462,873 | 19,603,048 | 276,880,706 | 89,751,955 | |||||||||||||||||||||
Increase (Decrease) in Net Assets | 55,609,344 | 116,750,590 | 92,673,487 | 21,662,820 | 271,423,508 | 92,090,296 | |||||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 201,886,121 | 85,135,531 | 21,662,820 | — | 92,090,296 | — | |||||||||||||||||||||
End of period | $ | 257,495,465 | $ | 201,886,121 | $ | 114,336,307 | $ | 21,662,820 | $ | 363,513,804 | $ | 92,090,296 | |||||||||||||||
Undistributed net investment income at end of period | $ | 215,472 | $ | — | $ | — | $ | — | $ | — | $ | 105,514 | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 13,600,000 | 8,100,000 | 3,700,000 | 1,900,000 | 17,900,000 | 3,700,000 | |||||||||||||||||||||
Shares repurchased | (11,300,000 | ) | (3,000,000 | ) | (1,100,000 | ) | (1,100,000 | ) | (7,500,000 | ) | (100,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 10,000,000 | 4,900,000 | 800,000 | — | 3,600,000 | — | |||||||||||||||||||||
Shares outstanding, end of period | 12,300,000 | 10,000,000 | 3,400,000 | 800,000 | 14,000,000 | 3,600,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
62
PowerShares Golden Dragon Halter USX China Portfolio | PowerShares Listed Private Equity Portfolio | PowerShares Lux Nanotech Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | For the Period October 24, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | 2,542,230 | $ | 3,172,560 | $ | 6,816,457 | $ | 1,314,594 | $ | (211,067 | ) | $ | (119,784 | ) | |||||||||||||
Net realized gain (loss) on investments | 225,313,096 | 48,676,384 | (5,793,748 | ) | 1,140,822 | (5,038,081 | ) | 2,437,702 | |||||||||||||||||||
Net change in unrealized appreciation (depreciation) of investments | (101,212,578 | ) | 13,246,066 | (40,433,048 | ) | 4,753,710 | (20,211,100 | ) | (12,992,856 | ) | |||||||||||||||||
Net increase (decrease) in net assets resulting from operations | 126,642,748 | 65,095,010 | (39,410,339 | ) | 7,209,126 | (25,460,248 | ) | (10,674,938 | ) | ||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 619,099 | 111,037 | (182,741 | ) | 242,577 | 73,183 | (40,198 | ) | |||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (3,881,852 | ) | (3,191,113 | ) | (6,147,694 | ) | (689,732 | ) | — | — | |||||||||||||||||
Return of capital | (198,502 | ) | — | — | — | — | — | ||||||||||||||||||||
Total distributions to shareholders | (4,080,354 | ) | (3,191,113 | ) | (6,147,694 | ) | (689,732 | ) | — | — | |||||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 831,380,876 | 286,475,511 | 76,913,561 | 162,455,219 | 24,034,571 | 91,815,890 | |||||||||||||||||||||
Value of shares repurchased | (819,780,640 | ) | (192,389,311 | ) | (78,054,703 | ) | (18,896,255 | ) | (73,198,428 | ) | (34,505,044 | ) | |||||||||||||||
Net income equalization | (619,099 | ) | (111,037 | ) | 182,741 | (242,577 | ) | (73,183 | ) | 40,198 | |||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 10,981,137 | 93,975,163 | (958,401 | ) | 143,316,387 | (49,237,040 | ) | 57,351,044 | |||||||||||||||||||
Increase (Decrease) in Net Assets | 134,162,630 | 155,990,097 | (46,699,175 | ) | 150,078,358 | (74,624,105 | ) | 46,635,908 | |||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 394,320,371 | 238,330,274 | 150,078,358 | — | 159,052,320 | 112,416,412 | |||||||||||||||||||||
End of period | $ | 528,483,001 | $ | 394,320,371 | $ | 103,379,183 | $ | 150,078,358 | $ | 84,428,215 | $ | 159,052,320 | |||||||||||||||
Undistributed net investment income at end of period | $ | — | $ | 588,109 | $ | 1,142,260 | $ | 624,862 | $ | — | $ | — | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 27,200,000 | 14,400,000 | 2,900,000 | 6,100,000 | 1,400,000 | 5,200,000 | |||||||||||||||||||||
Shares repurchased | (27,300,000 | ) | (10,100,000 | ) | (3,200,000 | ) | (700,000 | ) | (4,500,000 | ) | (2,000,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 18,400,000 | 14,100,000 | 5,400,000 | — | 9,100,000 | 5,900,000 | |||||||||||||||||||||
Shares outstanding, end of period | 18,300,000 | 18,400,000 | 5,100,000 | 5,400,000 | 6,000,000 | 9,100,000 |
63
Statements of Changes in Net Assets (Continued)
PowerShares S&P 500 BuyWrite Portfolio | PowerShares Value Line Industry Rotation Portfolio | PowerShares Value Line TimelinessTM Select Portfolio | |||||||||||||||||||||
For the Period December 19, 2007* Through April 30, 2008 | Year Ended April 30, 2008 | For the Period December 1, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | |||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||
Net investment income (loss) | $ | 13,626 | $ | 11,257 | $ | 2,617 | $ | (240,523 | ) | $ | (115,400 | ) | |||||||||||
Net realized gain (loss) on investments and written options | 20,654 | (556,166 | ) | 337,461 | 9,749,852 | (6,066,601 | ) | ||||||||||||||||
Net change in unrealized appreciation (depreciation) of investments and written options | 57,402 | (11,149 | ) | 1,738,936 | (20,623,471 | ) | 13,228,112 | ||||||||||||||||
Net increase (decrease) in net assets resulting from operations | 91,682 | (556,058 | ) | 2,079,014 | (11,114,142 | ) | 7,046,111 | ||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 14,403 | 1,411 | 2,011 | 56,801 | (29,370 | ) | |||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||
Net investment income | (10,500 | ) | (19,266 | ) | (2,669 | ) | — | — | |||||||||||||||
Return of capital | — | (1,384 | ) | (4,445 | ) | — | — | ||||||||||||||||
Total distributions to shareholders | (10,500 | ) | (20,650 | ) | (7,114 | ) | — | — | |||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||
Proceeds from shares sold | 7,419,561 | 90,728,154 | 39,530,660 | 410,338,472 | 461,154,401 | ||||||||||||||||||
Value of shares repurchased | — | (81,951,087 | ) | (7,952,741 | ) | (494,163,323 | ) | (378,402,470 | ) | ||||||||||||||
Net income equalization | (14,403 | ) | (1,411 | ) | (2,011 | ) | (56,801 | ) | 29,370 | ||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 7,405,158 | 8,775,656 | 31,575,908 | (83,881,652 | ) | 82,781,301 | |||||||||||||||||
Increase (Decrease) in Net Assets | 7,500,743 | 8,200,359 | 33,649,819 | (94,938,993 | ) | 89,798,042 | |||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||
Beginning of period | — | 33,649,819 | — | 272,607,579 | 182,809,537 | ||||||||||||||||||
End of period | $ | 7,500,743 | $ | 41,850,178 | $ | 33,649,819 | $ | 177,668,586 | $ | 272,607,579 | |||||||||||||
Undistributed net investment income at end of period | $ | 3,126 | $ | — | $ | — | $ | — | $ | — | |||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||
Shares sold | 300,000 | 3,200,000 | 1,500,000 | 23,600,000 | 29,200,000 | ||||||||||||||||||
Shares repurchased | — | (2,900,000 | ) | (300,000 | ) | (28,500,000 | ) | (24,400,000 | ) | ||||||||||||||
Shares outstanding, beginning of period | — | 1,200,000 | — | 15,500,000 | 10,700,000 | ||||||||||||||||||
Shares outstanding, end of period | 300,000 | 1,500,000 | 1,200,000 | 10,600,000 | 15,500,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
64
PowerShares Water Resources Portfolio | PowerShares WilderHill Clean Energy Portfolio | PowerShares WilderHill Progressive Energy Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | For the Period October 24, 2006* Through April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | 7,576,287 | $ | 11,614,106 | $ | (3,941,540 | ) | $ | 1,691,001 | $ | 147,013 | $ | 60,408 | ||||||||||||||
Net realized gain (loss) on investments and written options | 112,706,721 | 17,395,002 | 220,990,947 | (57,640,921 | ) | (2,065,989 | ) | 1,647,951 | |||||||||||||||||||
Net change in unrealized appreciation (depreciation) of investments and written options | (5,048 | ) | 62,772,486 | (213,773,816 | ) | (51,974,247 | ) | 144,615 | 1,837,263 | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | 120,277,960 | 91,781,594 | 3,275,591 | (107,924,167 | ) | (1,774,361 | ) | 3,545,622 | |||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 434,907 | 1,052,528 | (912,742 | ) | 188,257 | 22,365 | (2,980 | ) | |||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (7,498,823 | ) | (11,901,149 | ) | — | (1,691,001 | ) | (193,423 | ) | (14,162 | ) | ||||||||||||||||
Return of capital | — | — | — | (160,324 | ) | (9,290 | ) | — | |||||||||||||||||||
Total distributions to shareholders | (7,498,823 | ) | (11,901,149 | ) | — | (1,851,325 | ) | (202,713 | ) | (14,162 | ) | ||||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 1,059,031,268 | 875,926,807 | 1,424,637,475 | 602,781,817 | 66,870,104 | 40,867,799 | |||||||||||||||||||||
Value of shares repurchased | (581,939,914 | ) | (340,233,615 | ) | (868,365,037 | ) | (301,601,160 | ) | (25,700,249 | ) | (21,494,602 | ) | |||||||||||||||
Net income equalization | (434,907 | ) | (1,052,528 | ) | 912,742 | (188,257 | ) | (22,365 | ) | 2,980 | |||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 476,656,447 | 534,640,664 | 557,185,180 | 300,992,400 | 41,147,490 | 19,376,177 | |||||||||||||||||||||
Increase (Decrease) in Net Assets | 589,870,491 | 615,573,637 | 559,548,029 | 191,405,165 | 39,192,781 | 22,904,657 | |||||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 1,606,781,683 | 991,208,046 | 914,344,793 | 722,939,628 | 22,904,657 | — | |||||||||||||||||||||
End of period | $ | 2,196,652,174 | $ | 1,606,781,683 | $ | 1,473,892,822 | $ | 914,344,793 | $ | 62,097,438 | $ | 22,904,657 | |||||||||||||||
Undistributed net investment income at end of period | $ | 229,824 | $ | 152,360 | $ | — | $ | — | $ | — | $ | 46,410 | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 50,300,000 | 48,400,000 | 61,200,000 | 31,600,000 | 2,300,000 | 1,600,000 | |||||||||||||||||||||
Shares repurchased | (27,700,000 | ) | (19,000,000 | ) | (38,200,000 | ) | (16,500,000 | ) | (900,000 | ) | (800,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 83,700,000 | 54,300,000 | 47,400,000 | 32,300,000 | 800,000 | — | |||||||||||||||||||||
Shares outstanding, end of period | 106,300,000 | 83,700,000 | 70,400,000 | 47,400,000 | 2,200,000 | 800,000 |
65
Financial Highlights
PowerShares Aerospace & Defense Portfolio
Year Ended April 30, | For the Period October 26, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 20.19 | $ | 17.37 | $ | 14.91 | |||||||||
Net investment income** | 0.06 | 0.05 | 0.03 | ||||||||||||
Net realized and unrealized gain on investments | 0.72 | 2.83 | 2.45 | ||||||||||||
Total from operations | 0.78 | 2.88 | 2.48 | ||||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.04 | ) | (0.06 | ) | (0.02 | ) | |||||||||
Return of capital | — | — | (a) | — | |||||||||||
Total distributions | (0.04 | ) | (0.06 | ) | (0.02 | ) | |||||||||
Net asset value at end of period | $ | 20.93 | $ | 20.19 | $ | 17.37 | |||||||||
TOTAL RETURN*** | 3.86 | % | 16.66 | % | 16.66 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 257,495 | $ | 201,886 | $ | 85,136 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.66 | % | 0.66 | % | 0.68 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.64 | % | 0.77 | % | 0.80 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 0.27 | % | 0.28 | % | 0.31 | %† | |||||||||
Portfolio turnover rate †† | 13 | % | 16 | % | 1 | % | |||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | — | (a) | $ | — | (a) | — |
PowerShares CleantechTM Portfolio
Year Ended April 30, 2008 | For the Period October 24, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 27.08 | $ | 24.70 | |||||||
Net investment loss** | (0.10 | ) | (0.04 | ) | |||||||
Net realized and unrealized gain on investments | 6.65 | 2.42 | |||||||||
Total from operations | 6.55 | 2.38 | |||||||||
Net asset value at end of period | $ | 33.63 | $ | 27.08 | |||||||
TOTAL RETURN*** | 24.19 | % | 9.64 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 114,336 | $ | 21,663 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.69 | % | 0.71 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.77 | % | 1.06 | %† | |||||||
Net investment loss, after Waivers and/or Recapture | (0.31 | )% | (0.29 | )%† | |||||||
Portfolio turnover rate †† | 23 | % | 22 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.09 | ) | $ | 0.01 |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
66
Financial Highlights (Continued)
PowerShares DWA Technical LeadersTM Portfolio
Year Ended April 30, 2008 | For the Period March 1, 2007* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 25.58 | $ | 23.95 | |||||||
Net investment income (loss)** | (0.02 | ) | 0.04 | ||||||||
Net realized and unrealized gain on investments | 0.43 | 1.59 | |||||||||
Total from operations | 0.41 | 1.63 | |||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.01 | ) | — | ||||||||
Return of capital | (0.01 | ) | — | ||||||||
Total distributions | (0.02 | ) | — | ||||||||
Net asset value at end of period | $ | 25.97 | $ | 25.58 | |||||||
TOTAL RETURN*** | 1.62 | % | 6.81 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 363,514 | $ | 92,090 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.71 | % | 0.72 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.68 | % | 1.78 | %† | |||||||
Net investment income (loss), after Waivers and/or Recapture | (0.07 | )% | 1.50 | %†(a) | |||||||
Portfolio turnover rate †† | 83 | % | 9 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.07 | $ | 0.07 |
PowerShares Golden Dragon Halter USX China Portfolio
Year Ended April 30, | For the Period December 9, 2004* Through | ||||||||||||||||||
2008 | 2007 | 2006 | April 30, 2005 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||||||
Net asset value at beginning of period | $ | 21.43 | $ | 16.90 | $ | 13.00 | $ | 14.55 | |||||||||||
Net investment income** | 0.12 | 0.20 | 0.17 | 0.06 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 7.54 | 4.54 | 3.89 | (1.61 | ) | ||||||||||||||
Total from operations | 7.66 | 4.74 | 4.06 | (1.55 | ) | ||||||||||||||
Distributions to shareholders from: | |||||||||||||||||||
Net investment income | (0.20 | ) | (0.21 | ) | (0.16 | ) | — | ||||||||||||
Return of capital | (0.01 | ) | — | — | — | ||||||||||||||
Total distributions | (0.21 | ) | (0.21 | ) | (0.16 | ) | — | ||||||||||||
Net asset value at end of period | $ | 28.88 | $ | 21.43 | $ | 16.90 | $ | 13.00 | |||||||||||
TOTAL RETURN*** | 35.87 | % | 28.53 | % | 31.52 | % | (10.68 | )% | |||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||
Net assets at end of period (000's omitted) | $ | 528,483 | $ | 394,320 | $ | 238,330 | $ | 49,384 | |||||||||||
Ratio to average net assets of: | |||||||||||||||||||
Expenses, after Waivers and/or Recapture | 0.69 | % | 0.70 | % | 0.71 | % | 0.70 | %† | |||||||||||
Expenses, prior to Waivers and/or Recapture | 0.66 | % | 0.72 | % | 0.88 | % | 0.97 | %† | |||||||||||
Net investment income, after Waivers and/or Recapture | 0.42 | % | 1.06 | % | 1.18 | % | 1.24 | %† | |||||||||||
Portfolio turnover rate †† | 15 | % | 17 | % | 21 | % | 9 | % | |||||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.03 | $ | 0.01 | — | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Net investment income per share and the ratio of net investment income to average net assets include a special cash dividend received of $15.00 per share owned of Dean Foods Co. on April 2, 2007. Net investment loss per share and the ratio of net investment loss to average net assets excluding the special dividend were less than $0.005 and (0.11)%, respectively, for the year ended April 30, 2007.
See Notes to Financial Statements.
67
Financial Highlights (Continued)
PowerShares Listed Private Equity Portfolio
Year Ended April 30, 2008 | For the Period October 24, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 27.79 | $ | 25.09 | |||||||
Net investment income** | 1.22 | 0.44 | |||||||||
Net realized and unrealized gain (loss) on investments | (7.63 | ) | 2.60 | ||||||||
Total from operations | (6.41 | ) | 3.04 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (1.11 | ) | (0.34 | ) | |||||||
Net asset value at end of period | $ | 20.27 | $ | 27.79 | |||||||
TOTAL RETURN*** | (23.50 | )% | 12.18 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 103,379 | $ | 150,078 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.71 | % | 0.71 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.72 | % | 0.82 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 5.04 | % | 3.38 | %† | |||||||
Portfolio turnover rate †† | 30 | % | 19 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.03 | ) | $ | 0.08 |
PowerShares Lux Nanotech Portfolio
Year Ended April 30, | For the Period October 26, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 17.48 | $ | 19.05 | $ | 15.32 | |||||||||
Net investment income (loss)** | (0.03 | ) | (0.02 | ) | 0.02 | ||||||||||
Net realized and unrealized gain (loss) on investments | (3.38 | ) | (1.55 | ) | 3.79 | ||||||||||
Total from operations | (3.41 | ) | (1.57 | ) | 3.81 | ||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | — | — | (0.01 | ) | |||||||||||
Return of capital | — | — | (0.07 | ) | |||||||||||
Total distributions | — | — | (0.08 | ) | |||||||||||
Net asset value at end of period | $ | 14.07 | $ | 17.48 | $ | 19.05 | |||||||||
TOTAL RETURN*** | (19.51 | )% | (8.24 | )% | 24.94 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 84,428 | $ | 159,052 | $ | 112,416 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.70 | % | 0.71 | % | 0.73 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.73 | % | 0.79 | % | 0.83 | %† | |||||||||
Net investment income (loss), after Waivers and/or Recapture | (0.17 | )% | (0.09 | )% | 0.17 | %† | |||||||||
Portfolio turnover rate †† | 42 | % | 16 | % | 6 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | 0.01 | $ | (0.01 | ) | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
See Notes to Financial Statements.
68
Financial Highlights (Continued)
PowerShares S&P 500 BuyWrite Portfolio
For the Period December 19, 2007* Through April 30, 2008 | |||||||
PER SHARE OPERATING PERFORMANCE: | |||||||
Net asset value at beginning of period | $ | 24.97 | |||||
Net investment income** | 0.09 | ||||||
Net realized and unrealized loss on investments | (0.01 | ) | |||||
Total from operations | 0.08 | ||||||
Distributions to shareholders from: | |||||||
Net investment income | (0.05 | ) | |||||
Net asset value at end of period | $ | 25.00 | |||||
TOTAL RETURN*** | 0.33 | % | |||||
RATIOS/SUPPLEMENTAL DATA: | |||||||
Net assets at end of period (000's omitted) | $ | 7,500 | |||||
Ratio to average net assets of: | |||||||
Expenses | 0.75 | %† | |||||
Net investment income | 1.12 | %† | |||||
Portfolio turnover rate †† | 10 | % | |||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.09 |
PowerShares Value Line Industry Rotation Portfolio
Year Ended April 30, 2008 | For the Period December 1, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 28.04 | $ | 25.19 | |||||||
Net investment income** | 0.01 | — | (a) | ||||||||
Net realized and unrealized gain (loss) on investments | (0.14 | ) | 2.86 | ||||||||
Total from operations | (0.13 | ) | 2.86 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.01 | ) | — | (a) | |||||||
Return of capital | — | (a) | (0.01 | ) | |||||||
Total distributions | (0.01 | ) | (0.01 | ) | |||||||
Net asset value at end of period | $ | 27.90 | $ | 28.04 | |||||||
TOTAL RETURN*** | (0.45 | )% | 11.36 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 41,850 | $ | 33,650 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.73 | % | 0.75 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.95 | % | 1.21 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.03 | % | 0.03 | %† | |||||||
Portfolio turnover rate †† | 77 | % | 13 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | — | (a) | $ | — | (a) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
The total return from Fund Inception (first day of trading on the Exchange) to April 30, 2008 was (0.19)%.
See Notes to Financial Statements.
69
Financial Highlights (Continued)
PowerShares Value Line TimelinessTM Select Portfolio
Year Ended April 30, | For the Period December 6, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 17.59 | $ | 17.09 | $ | 15.52 | |||||||||
Net investment loss** | (0.02 | ) | (0.01 | ) | (0.02 | ) | |||||||||
Net realized and unrealized gain (loss) on investments | (0.81 | ) | 0.51 | 1.59 | |||||||||||
Total from operations | (0.83 | ) | 0.50 | 1.57 | |||||||||||
Net asset value at end of period | $ | 16.76 | $ | 17.59 | $ | 17.09 | |||||||||
TOTAL RETURN*** | (4.72 | )% | 2.93 | % | 10.12 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 177,669 | $ | 272,608 | $ | 182,810 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.70 | % | 0.70 | % | 0.71 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.70 | % | 0.75 | % | 0.78 | %† | |||||||||
Net investment loss, after Waivers and/or Recapture | (0.12 | )% | (0.06 | )% | (0.30 | )%† | |||||||||
Portfolio turnover rate †† | 101 | % | 113 | % | 39 | % | |||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.01 | $ | — | (a) | — |
PowerShares Water Resources Portfolio
Year Ended April 30, | For the Period December 6, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 19.20 | $ | 18.25 | $ | 15.32 | |||||||||
Net investment income** | 0.08 | 0.17 | 0.02 | ||||||||||||
Net realized and unrealized gain on investments | 1.46 | 0.95 | 2.94 | ||||||||||||
Total from operations | 1.54 | 1.12 | 2.96 | ||||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.08 | ) | (0.17 | ) | (0.03 | ) | |||||||||
Net asset value at end of period | $ | 20.66 | $ | 19.20 | $ | 18.25 | |||||||||
TOTAL RETURN*** | 8.02 | % | 6.26 | % | 19.38 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 2,196,652 | $ | 1,606,782 | $ | 991,208 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.64 | % | 0.66 | % | 0.67 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.63 | % | 0.67 | % | 0.70 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 0.39 | % | 0.96 | % | 0.40 | %† | |||||||||
Portfolio turnover rate †† | 23 | % | 27 | % | 2 | % | |||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.01 | $ | 0.02 | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
70
Financial Highlights (Continued)
PowerShares WilderHill Clean Energy Portfolio
Year Ended April 30, | For the Period March 3, 2005* Through | ||||||||||||||||||
2008 | 2007 | 2006 | April 30, 2005 | ||||||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||||||
Net asset value at beginning of period | $ | 19.29 | $ | 22.38 | $ | 12.86 | $ | 15.61 | |||||||||||
Net investment income (loss)** | (0.07 | ) | 0.04 | (0.07 | ) | (0.01 | ) | ||||||||||||
Net realized and unrealized gain (loss) on investments | 1.72 | (3.08 | ) | 9.59 | (2.74 | ) | |||||||||||||
Total from operations | 1.65 | (3.04 | ) | 9.52 | (2.75 | ) | |||||||||||||
Distributions to shareholders from: | |||||||||||||||||||
Net investment income | — | (0.05 | ) | — | — | ||||||||||||||
Return of capital | — | — | (a) | — | — | ||||||||||||||
Total distributions | — | (0.05 | ) | — | — | ||||||||||||||
Net asset value at end of period | $ | 20.94 | $ | 19.29 | $ | 22.38 | $ | 12.86 | |||||||||||
TOTAL RETURN*** | 8.55 | % | (13.58 | )% | 74.03 | % | (17.59 | )% | |||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||
Net assets at end of period (000's omitted) | $ | 1,473,893 | $ | 914,345 | $ | 722,940 | $ | 27,012 | |||||||||||
Ratio to average net assets of: | |||||||||||||||||||
Expenses, after Waivers and/or Recapture | 0.67 | % | 0.70 | % | 0.71 | % | 0.70 | %† | |||||||||||
Expenses, prior to Waivers and/or Recapture | 0.67 | % | 0.69 | % | 0.75 | % | 1.35 | %† | |||||||||||
Net investment income (loss), after Waivers and/or Recapture | (0.32 | )% | 0.24 | %††† | (0.39 | )% | (0.31 | )%† | |||||||||||
Portfolio turnover rate †† | 20 | % | 41 | % | 6 | % | 9 | % | |||||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.02 | ) | $ | 0.01 | — | — |
PowerShares WilderHill Progressive Energy Portfolio
Year Ended April 30, 2008 | For the Period October 24, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 28.63 | $ | 24.91 | |||||||
Net investment income** | 0.09 | 0.06 | |||||||||
Net realized and unrealized gain (loss) on investments | (0.36 | ) | 3.68 | ||||||||
Total from operations | (0.27 | ) | 3.74 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.12 | ) | (0.02 | ) | |||||||
Return of capital | (0.01 | ) | — | ||||||||
Total distributions | (0.13 | ) | (0.02 | ) | |||||||
Net asset value at end of period | $ | 28.23 | $ | 28.63 | |||||||
TOTAL RETURN*** | (0.96 | )% | 15.01 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 62,097 | $ | 22,905 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.73 | % | 0.74 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.88 | % | 1.09 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.30 | % | 0.45 | %† | |||||||
Portfolio turnover rate †† | 31 | % | 12 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.01 | $ | — | (a) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
††† Net investment income per share and the ratio of net investment income to average net assets include a special cash dividend received of $6.72 per share owned of Scottish Power PLC ADR on May 18, 2006. Net investment loss per share and the ratio of net investment loss to average net assets excluding the special dividend were $(0.04) and (0.23)%, respectively, for the year ended April 30, 2007.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
71
Notes to Financial Statements
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the "Trust") was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company, registered under the Investment Company Act of 1940, as amended (the "1940 Act"). As of period end, the Trust offers seventy-three portfolios. This report includes the following portfolios:
PowerShares Aerospace & Defense Portfolio | "Aerospace & Defense Portfolio" | ||||||
PowerShares CleantechTM Portfolio | "CleantechTM Portfolio" | ||||||
PowerShares DWA Technical LeadersTM Portfolio | "DWA Technical LeadersTM Portfolio" | ||||||
PowerShares Golden Dragon Halter USX China Portfolio | "Golden Dragon Halter USX China Porfolio" | ||||||
PowerShares Listed Private Equity Portfolio | "Listed Private Equity Portfolio" | ||||||
PowerShares Lux Nanotech Portfolio | "Lux Nanotech Portfolio" | ||||||
PowerShares S&P 500 BuyWrite Portfolio | "S&P 500 BuyWrite Portfolio" | ||||||
PowerShares Value Line Industry Rotation Portfolio | "Value Line Industry Rotation Portfolio" | ||||||
PowerShares Value Line TimelinessTM Select Portfolio | "Value Line TimelinessTM Select Portfolio" | ||||||
PowerShares Water Resources Portfolio | "Water Resources Portfolio" | ||||||
PowerShares WilderHill Clean Energy Portfolio | "WilderHill Clean Energy Portfolio" | ||||||
PowerShares WilderHill Progressive Energy Portfolio | "WilderHill Progressive Energy Portfolio" | ||||||
Each portfolio (the "Fund" or collectively the "Funds") represents a separate series of the Trust. Each Fund's shares are listed and traded on the American Stock Exchange except for shares of the S&P 500 BuyWrite Portfolio and DWA Technical LeadersTM Portfolio. The shares of S&P 500 BuyWrite Portfolio and DWA Technical LeadersTM Portfolio are traded on the New York Stock Exchange Arca, Inc. ("NYSE Arca").
The Funds' market prices may differ to some degree from the net asset value of the shares of each Fund. Unlike conventional mutual funds, each Fund issues and redeems shares on a continuous basis, at net asset value, only in a large specified number of shares, each called a "Creation Unit." Creation Units are issued and redeemed generally in-kind for securities included in the relevant index. Except when aggregated in Creation Units, shares are not individually redeemable securities of the Funds. The investment objective of each Fund is to seek investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of the following equity indices:
Fund | Index | ||||||
Aerospace & Defense Portfolio | SPADETM Defense Index | ||||||
CleantechTM Portfolio | CleantechTM Index | ||||||
DWA Technical LeadersTM Portfolio | Dorsey Wright Technical LeadersTM Index | ||||||
Golden Dragon Halter USX China Portfolio | Halter USX China IndexSM | ||||||
Listed Private Equity Portfolio | Red Rocks Listed Private Equity Index | ||||||
Lux Nanotech Portfolio | Lux Nanotech IndexTM | ||||||
S&P 500 BuyWrite Portfolio | CBOE S&P 500 BuyWrite Index | ||||||
72
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Fund | Index | ||||||
Value Line Industry Rotation Portfolio | Value Line Industry Rotation Index | ||||||
Value Line TimelinessTM Select Portfolio | Value Line TimelinessTM Select Index | ||||||
Water Resources Portfolio | Palisades Water Index | ||||||
WilderHill Clean Energy Portfolio | WilderHill Clean Energy Index | ||||||
WilderHill Progressive Energy Portfolio | WilderHill Progressive Energy Index | ||||||
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates.
A. Security Valuation
Securities, including restricted securities, are valued according to the following policy.
A security listed or traded on an exchange (except convertible bonds) 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. Listed options if no closing price is available are valued at the mean between the last bid and the ask 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 ask prices.
Investments in open-end registered investment companies are valued at the end of day net asset value per share.
Debt obligations (including convertible bonds) 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, yield, quality, type of issue, coupon rate, maturity, individual trading characteristics and other market data. Short-term obligations, including commercial paper, having 60 days or less to maturity are recorded at amortized cost which approximates value. Debt securities are subject to interest rate and credit risks. In addition, all debt securities involve some risk of default with respect to interest and/or principal payments.
Foreign securities (including foreign exchange contracts) are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. 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 are significant and may 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
73
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
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 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, ADRs 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 upheav al, 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.
Securities for which market quotations are not readily available or are 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/ask 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.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer's assets, general economic conditions, interest rates, investor perceptions and market liquidity.
B. Other Risks
The Funds may concentrate investments in a comparatively narrow segment of the economy. Consequently, such Fund may tend to be more volatile than other funds, and the value of investments may tend to rise and fall more rapidly.
Investments in the securities of non-U.S. issuers may have greater risk than those investments in U.S. securities. Investments in securities denominated in foreign currencies are subject to risk of adverse changes in currency exchange rates which may negatively impact returns. The risk can also be associated with the level of development of the economies of the countries in a specific region.
There are certain risks inherent in investing in listed private equity companies, which encompass financial institutions or vehicles whose principal business is to invest in and lend capital to privately-held companies. Generally, little public information exists for private and thinly traded companies and there is a risk that investors may not be able to make a fully informed investment decision. Investments made by listed private equity companies are generally subject to legal and other restrictions on resale and are otherwise less liquid than publicly-traded securities. The illiquidity of these investments may make it difficult to sell such investments if the need arises, and if there is a need for a listed private equity company in which the Fund invests to liquidate its portfolio quickly, it may realize a loss on its investments. Since many of the assets of listed private equity companies do not have readily ascertainable m arket values, such assets are most often recorded at fair value, in good faith, in accordance with valuation procedures adopted by such companies.
74
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
When investing in securities of a limited number of companies, each investment has a greater effect on the Fund's overall performance, and any change in the value of those securities could significantly affect the value of your investment in the Fund.
C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and will distribute substantially all of the Fund's taxable earnings to its shareholders. As such, the Funds will not be subject to Federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for Federal income taxes is included.
Income and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from accounting principles generally accepted in the United States. These differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and Passive Foreign Investment Company adjustments, if any.
The Funds file tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
D. Investment Income and Investment Transactions
Dividend income is recorded on the ex-dividend date net of foreign taxes withheld, if any. Interest income is recorded on the accrual basis. Investment transactions are recorded on the trade date. Realized gains and losses from the sale or disposition of securities are calculated on the specific identified cost basis. Dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
E. Expenses
Expenses of the Trust, which are directly identifiable to a specific Fund, are applied to that Fund. Expenses which are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund (except for S&P 500 BuyWrite Portfolio) is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, any distribution fees or expenses and extraordinary expenses.
The S&P 500 BuyWrite Portfolio has agreed to pay an annual unitary management fee to the Invesco PowerShares Capital Management LLC ("the Adviser") (formerly PowerShares Capital Management LLC). Whereby, the Adviser has agreed to pay substantially all expenses of the S&P 500 BuyWrite Portfolio, including the cost of transfer agency, custody, fund administration, legal, audit and other services, except for advisory fees and distribution fees, brokerage expenses, taxes, interest and other extraordinary expenses, if any.
75
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
F. Dividends and Distributions to Shareholders
Each Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and distributes net realized taxable capital gains, if any, annually in cash. Such distributions on a tax basis are determined in conformity with income tax regulations which may differ from accounting principles generally accepted in the United States of America. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund's financial statements as a tax return of capital at fiscal period end.
G. Equalization
All Funds use the accounting practice of equalization. This accounting method is used to keep the continuing shareholder's per share equity in undistributed net investment income from being affected by the continuous sales and redemptions of capital shares. Equalization is calculated on a per share basis whereby a portion of the proceeds from the sales and cost of repurchases of capital shares is applied to undistributed net investment income. The amount of equalization is disclosed in the Statements of Changes in Net Assets as undistributed net investment income included in the price of capital shares issued or redeemed. The distributions to shareholders of amounts so applied may be deemed to be a return of capital for tax purposes to the extent that such distributions exceed taxable income.
H. Option Contracts Written
The S&P 500 BuyWrite Portfolio may write (sell) call options against the portfolio through a "buy-write" strategy. A "buy-write," also called a covered call, generally is considered to be an investment strategy in which an investor buys a stock or basket of stocks, and also sells call options that correspond to the stock or basket of stocks. When the Fund writes (sells) call options, the amount of the premium received is recorded as a liability and is subsequently adjusted to the current fair value of the option written, the Fund gives the right to the purchaser of the option written by the Fund to receive a cash payment equal to the difference between the value of the S&P 500 Index and the exercise price, if the value on the expiration date is above the exercise price. By writing written options, in return for the receipt of premiums, the Fund gives up the opportunity during the term of the option to profit from any pri ce increase in the S&P 500 Index above the option exercise price. In addition, covered call options partially hedge against a decline in the price of the securities on which they are written to the extent of the premium received by the Fund. Therefore, the Fund, by writing covered call options, will give up the opportunity to benefit from potential increases in the value of the S&P 500 Index above the exercise prices of the written options, but will continue to bear the risk of declines in the value of the S&P 500 Index. The premiums received from the options may not be sufficient to offset any losses sustained from the volatility of the underlying stocks over time. In addition, the Fund's ability to sell the underlying securities will be limited while the option is in effect unless the Fund extinguishes the option position, through the purchase of an offsetting identical option prior to the expiration of the written option.
76
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Transactions During the Period | |||||||||||
Call Option Contracts | |||||||||||
Number of Contracts | Premiums Received | ||||||||||
Beginning of period | — | $ | — | ||||||||
Written | 185 | 477,925 | |||||||||
Closed | (56 | ) | (194,483 | ) | |||||||
Exercised | — | — | |||||||||
Expired | (66 | ) | (138,992 | ) | |||||||
End of period | 63 | $ | 144,450 |
Open Options Written at Period End | |||||||||||||||||||||||||||
Contract Month | Strike Price | Number of Contracts | Premiums Received | Value | Unrealized Appreciation (Depreciation) | ||||||||||||||||||||||
Call Option S&P 500 Index | May-08 | $ | 1,390 | 54 | $ | 142,154 | $ | (100,170 | ) | $ | 41,984 | ||||||||||||||||
Call Option S&P 500 Mini Index | May-08 | 139 | 9 | 2,296 | (1,701 | ) | 595 | ||||||||||||||||||||
63 | $ | 144,450 | $ | (101,871 | ) | $ | 42,579 |
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with the Adviser under which the Adviser has overall responsibility as the Funds' investment adviser for the selection and ongoing monitoring of the Funds' investments, managing the Funds' business affairs and providing certain clerical, bookkeeping and other administrative services. Each Fund (other than the S&P 500 BuyWrite Portfolio) has agreed to pay an annual fee of 0.50% of the Fund's average daily net assets. The S&P 500 BuyWrite Portfolio has agreed to pay an annual unitary management fee of 0.75% of its average daily net assets and the Adviser has agreed to pay substantially all expenses of the S&P 500 BuyWrite Portfolio, including the cost of transfer agency, custody, fund administration, legal, audit and other services, except for advisory fees and distribution fees, brokerage expenses, taxes, interest and other extraordinary expenses, if any.
The Adviser has entered into an Amended and Restated Excess Expense Agreement ("Excess Expense Agreement") with the Trust, under which the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses of the Funds (other than the S&P 500 BuyWrite Portfolio) (excluding interest expense, brokerage commissions and other trading expenses, sub-licensing fees, offering costs, taxes and extraordinary expenses) from exceeding 0.60% of average daily net assets per year (the "Expense Cap"), at least until August 30, 2009. Offering costs excluded from the Expense Cap are: (a) legal fees pertaining to the Funds' shares offered for sale; (b) Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange.
For each Fund other than the S&P 500 BuyWrite Portfolio, the Excess Expense Agreement provides that the expenses borne by the Adviser are subject to recapture by the Adviser for up to three years from the date the fee or expense was borne by the Adviser, but no recapture payment will be made by a Fund if it would result in the Fund exceeding its Expense Cap as specified above. The Excess Expense Agreement
77
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
does not apply to the S&P 500 BuyWrite Portfolio. Accordingly, expenses of this Fund borne by the Adviser are not subject to recapture.
The net amount of fees waived and other expenses assumed by the Adviser and the amount of recapture paid to the Adviser pursuant to the Excess Expense Agreement are collectively referred to as 'Waivers and/or Recapture'.
During the period ended April 30, 2008, the amount of 'Waivers and/or Recapture' was as follows:
(Waivers) and/or Recapture | |||||||
Aerospace & Defense Portfolio | $ | 68,771 | |||||
CleantechTM Portfolio | (57,076 | ) | |||||
DWA Technical LeadersTM Portfolio | 52,829 | ||||||
Golden Dragon Halter USX China Portfolio | 204,381 | ||||||
Listed Private Equity Portfolio | (8,102 | ) | |||||
Lux Nanotech Portfolio | (39,701 | ) | |||||
Value Line Industry Rotation Portfolio | (86,494 | ) | |||||
Value Line TimelinessTM Select Portfolio | 4,989 | ||||||
Water Resources Portfolio | 139,671 | ||||||
WilderHill Clean Energy Portfolio | (7,102 | ) | |||||
WilderHill Progressive Energy Portfolio | (71,221 | ) |
The net amounts of (Waivers) and/or Recapture are also shown on the Statements of Operations.
The amounts available for potential future recapture by the Adviser under the Excess Expense Agreement and the expiration schedule at April 30, 2008 are as follows:
Total Potential | Potential Recapture Amounts Expiring | ||||||||||||||||||
Recapture Amount | 04/30/09 | 04/30/10 | 04/30/11 | ||||||||||||||||
Aerospace & Defense Portfolio | $ | 84,727 | $ | — | $ | 72,874 | $ | 11,853 | |||||||||||
CleantechTM Portfolio | 105,241 | — | 47,553 | 57,688 | |||||||||||||||
DWA Technical LeadersTM Portfolio | 21,651 | — | — | 21,651 | |||||||||||||||
Golden Dragon Halter USX China Portfolio | 41,317 | — | 4,806 | 36,511 | |||||||||||||||
Listed Private Equity Portfolio | 50,724 | — | 26,323 | 24,401 | |||||||||||||||
Lux Nanotech Portfolio | 178,818 | 31,393 | 106,036 | 41,389 | |||||||||||||||
Value Line Industry Rotation Portfolio | 126,596 | 34,558 | 92,038 | ||||||||||||||||
Value Line TimelinessTM Select Portfolio | 110,515 | — | 86,184 | 24,331 | |||||||||||||||
Water Resources Portfolio | 75,183 | — | — | 75,183 | |||||||||||||||
WilderHill Clean Energy Portfolio | 90,755 | — | — | 90,755 | |||||||||||||||
WilderHill Progressive Energy Portfolio | 118,588 | — | 39,456 | 79,132 |
Distribution Agreement
The Trust has entered into a Distribution Agreement with Invesco Aim Distributors, Inc. (formerly A I M Distributors, Inc.) (the "Distributor") which serves as the Distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in Shares.
78
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Licensing Fee Agreements
The Adviser has entered into licensing agreements for each Fund with the following Licensor:
Fund | Licensor | ||||||
Aerospace & Defense Portfolio | International Space Business Council | ||||||
CleantechTM Portfolio | Cleantech Capital Indices, LLC | ||||||
DWA Technical LeadersTM Portfolio | Dorsey, Wright & Associates, Inc. | ||||||
Golden Dragon Halter USX China Portfolio | Halter Financial Group | ||||||
Listed Private Equity Portfolio | Red Rocks Capital Partners, LLC | ||||||
Lux Nanotech Portfolio | Lux Research, Inc. | ||||||
S&P 500 BuyWrite Portfolio | Standard & Poor's ("S&P"), a division of The McGraw-Hill Companies, Inc. | ||||||
Value Line Industry Rotation Portfolio | Value Line Publishing, Inc. | ||||||
Value Line TimelinessTM Select Portfolio | Value Line Publishing, Inc. | ||||||
Water Resources Portfolio | Palisades Water Index Associates, LLC | ||||||
WilderHill Clean Energy Portfolio | WilderShares, LLC | ||||||
WilderHill Progressive Energy Portfolio | WilderShares, LLC | ||||||
The above trademarks are owned by the respective Licensors. These trademarks have been licensed to the Adviser for use with the Funds. The Funds are not sponsored, endorsed, sold or promoted by the Licensors and the Licensors make no representation regarding the advisability of investing in any of these Funds. The Funds are required to pay the sub-licensing fees which are shown on the Statements of Operations.
The Bank of New York, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian and fund accounting and transfer agent for each Fund.
The custodian has agreed to provide overdraft protection to the Funds according to the terms of the service agreement.
Note 4. Investments in Affiliates
The 1940 Act defines "affiliate" to include issuers of which a fund holds 5% or more of the outstanding voting securities. The following is a summary of the transactions with affiliates for the year ended April 30, 2008.
79
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Lux Nanotech Portfolio
Value 4/30/07 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation (Depreciation) | Value 04/30/08 | Dividend Income | Realized Gain (Loss) | |||||||||||||||||||||||||
Biosante Pharmaceuticals, Inc. | $ | — | $ | 5,086,786 | $ | (81,622 | ) | $ | (565,228 | ) | $ | 4,439,935 | $ | — | $ | 20,930 | |||||||||||||||
Luna Innovations, Inc. | — | 3,727,745 | (66,647 | ) | (254,378 | ) | 3,406,720 | — | 21,081 | ||||||||||||||||||||||
Nanophase Technologies Corp. | 8,793,107 | 3,304,412 | (4,025,580 | ) | (4,208,356 | ) | 3,863,583 | — | (131,310 | ) | |||||||||||||||||||||
NVE Corp. | 7,239,341 | 2,202,099 | (5,241,918 | ) | 1,111,975 | 5,311,497 | — | 1,216,524 | |||||||||||||||||||||||
Total Investments in Affiliates | 16,032,448 | 14,321,042 | (9,415,767 | ) | (3,915,987 | ) | 17,021,735 | — | 1,127,225 |
Water Resources Portfolio
Ameron International Corp. | 26,644,689 | 40,757,130 | (8,465,816 | ) | 10,643,303 | 69,579,307 | 666,051 | 890,517 | |||||||||||||||||||||||
Badger Meter, Inc. | 32,146,128 | 2,781,508 | (3,415,539 | ) | 36,362,085 | 67,874,182 | 456,138 | (308,917 | ) | ||||||||||||||||||||||
Calgon Carbon Corp. | 30,459,259 | 2,434,044 | (5,106,901 | ) | 23,442,263 | 51,228,665 | — | 1,629,026 | |||||||||||||||||||||||
Consolidated Water Co., Inc. (Cayman Islands) | 29,548,749 | 7,654,569 | (11,943,150 | ) | (3,666,174 | ) | 21,593,994 | 307,701 | (1,715,212 | ) | |||||||||||||||||||||
Franklin Electric Co., Inc. | 43,535,711 | 35,199,130 | (8,579,605 | ) | (7,260,598 | ) | 62,894,638 | 656,872 | (1,980,960 | ) | |||||||||||||||||||||
Gorman-Rupp (The) Co. | 22,030,775 | 23,519,195 | (2,757,290 | ) | 11,337,077 | 54,129,757 | 428,575 | 362,133 | |||||||||||||||||||||||
Insituform Technologies, Inc., Class A | 40,080,492 | 17,725,120 | (6,668,816 | ) | (9,349,878 | ) | 41,786,918 | — | (3,676,217 | ) | |||||||||||||||||||||
Layne Christensen Co. | 54,785,317 | 21,130,264 | (14,395,831 | ) | 8,990,163 | 70,509,913 | — | 5,342,098 | |||||||||||||||||||||||
Lindsay Corp. | 33,398,054 | 3,546,632 | (24,064,172 | ) | 77,671,089 | 90,551,603 | 292,127 | 15,964,318 | |||||||||||||||||||||||
Mueller Water Products, Inc., Class B | 49,627,513 | 49,223,051 | (14,004,778 | ) | (29,860,111 | ) | 54,985,675 | 319,940 | (445,855 | ) | |||||||||||||||||||||
Southwest Water Co. | 31,191,279 | 1,579,842 | (5,686,362 | ) | (5,475,955 | ) | 21,608,804 | 518,417 | (2,024,552 | ) | |||||||||||||||||||||
Tetra Tech, Inc. | 71,993,291 | 53,450,572 | (24,920,205 | ) | 889,691 | 101,413,350 | — | 1,041,216 | |||||||||||||||||||||||
Watts Water Technologies, Inc., Class A | 51,171,183 | 36,993,102 | (10,635,802 | ) | (23,295,580 | ) | 54,232,903 | 719,956 | (2,630,681 | ) | |||||||||||||||||||||
Total Investments in Affiliates | 516,612,440 | 295,994,159 | (140,644,267 | ) | 90,427,375 | 762,389,709 | 4,365,777 | 12,446,914 |
80
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
WilderHill Clean Energy Portfolio
Value 4/30/07 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation (Depreciation) | Value 04/30/08 | Dividend Income | Realized Gain (Loss) | |||||||||||||||||||||||||
Active Power, Inc. | $ | 4,446,875 | $ | 7,628,758 | $ | (3,813,674 | ) | $ | (2,088,943 | ) | $ | 6,173,016 | $ | — | $ | (1,285,519 | ) | ||||||||||||||
Amerigon, Inc. | — | 45,468,980 | (11,897,196 | ) | (9,869,764 | ) | 23,702,020 | — | (2,428,210 | ) | |||||||||||||||||||||
Ballard Power Systems, Inc. | 16,550,775 | 33,323,648 | (15,163,405 | ) | (7,984,578 | ) | 26,726,440 | — | (4,642,586 | ) | |||||||||||||||||||||
China BAK Battery, Inc. | — | 28,190,268 | (1,063,887 | ) | (9,598,221 | ) | 17,528,160 | — | 41,983 | ||||||||||||||||||||||
Comverge, Inc. | — | 57,577,351 | (5,128,913 | ) | (31,026,010 | ) | 21,422,428 | — | (267,167 | ) | |||||||||||||||||||||
Echelon Corp. | 34,761,426 | 49,865,285 | (40,983,252 | ) | (8,028,394 | ) | 35,615,065 | — | 20,112,781 | ||||||||||||||||||||||
Emcore Corp. | 23,887,042 | 543,393 | (2,394,452 | ) | 6,663,733 | 28,699,716 | — | (756,021 | ) | ||||||||||||||||||||||
Fuel Systems Solutions, Inc. | 24,616,050 | 1,214,185 | (3,675,048 | ) | 2,085,381 | 24,240,568 | — | (1,675,365 | ) | ||||||||||||||||||||||
FuelCell Energy, Inc. | 15,741,912 | 30,306,275 | (12,518,371 | ) | 2,854,225 | 36,384,041 | — | 1,162,899 | |||||||||||||||||||||||
Maxwell Technologies, Inc. | 19,578,194 | 5,648,010 | (3,817,533 | ) | (2,807,084 | ) | 18,601,587 | — | (3,009,815 | ) | |||||||||||||||||||||
Medis Technologies, Ltd. | 16,788,999 | 24,978,887 | (1,488,174 | ) | (16,149,904 | ) | 24,129,808 | — | (671,845 | ) | |||||||||||||||||||||
Pacific Ethanol, Inc. | 20,482,001 | 24,985,410 | (3,316,959 | ) | (29,749,376 | ) | 12,401,076 | — | (3,378,370 | ) | |||||||||||||||||||||
Plug Power, Inc. | 19,171,094 | 13,673,093 | (7,634,332 | ) | 24,278 | 25,234,133 | — | (2,082,445 | ) | ||||||||||||||||||||||
Ultralife Batteries, Inc. | 4,185,225 | 18,735,010 | (1,146,949 | ) | (7,783,198 | ) | 13,990,088 | — | 2,250 | ||||||||||||||||||||||
Universal Display Corp. | 28,813,854 | 32,057,902 | (16,752,435 | ) | (5,203,148 | ) | 38,916,173 | — | (870,154 | ) | |||||||||||||||||||||
Verenium Corp.* | 24,328,146 | 16,719,104 | (4,543,953 | ) | (19,654,544 | ) | 16,848,753 | — | (1,371,732 | ) | |||||||||||||||||||||
Zoltek Cos., Inc. | 25,143,623 | 46,119,586 | (13,145,046 | ) | (14,478,336 | ) | 43,639,827 | — | 4,132,109 | ||||||||||||||||||||||
Total Investments in Affiliates | 278,495,216 | 437,035,145 | (148,483,579 | ) | (152,793,883 | ) | 414,252,899 | — | 3,012,793 |
* Security formerly known as Diversa Corp.
Note 5. Federal Income Tax
At April 30, 2008, costs of investments on a tax basis including the adjustments for financial reporting purposes as of the most recently completed Federal income tax reporting period were as follows:
Aerospace & Defense Portfolio | $ | 274,612,642 | |||||
CleantechTM Portfolio | 113,462,422 | ||||||
DWA Technical LeadersTM Portfolio | 348,014,179 | ||||||
Golden Dragon Halter USX China Portfolio | 604,619,842 | ||||||
Listed Private Equity Portfolio | 140,991,323 | ||||||
Lux Nanotech Portfolio | 109,529,797 | ||||||
S&P 500 BuyWrite Portfolio | 7,676,571 | ||||||
Value Line Industry Rotation Portfolio | 40,187,983 | ||||||
Value Line TimelinessTM Select Portfolio | 174,636,325 |
81
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Water Resources Portfolio | $ | 2,097,102,943 | |||||
WilderHill Clean Energy Portfolio | 1,689,691,038 | ||||||
WilderHill Progressive Energy Portfolio | 60,586,308 |
At April 30, 2008, the components of accumulated earnings/loss on a tax basis were as follows:
Accumulated Earnings | Net Accumulated Capital and other Gains/Losses | Unrealized Appreciation/ Depreciation | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Total Accumulated Earnings/Loss | ||||||||||||||||||||||
Aerospace & Defense Portfolio | $ | 215,472 | $ | (2,478,965 | ) | $ | (17,422,118 | ) | $ | 7,607,242 | $ | (25,029,360 | ) | $ | (19,685,611 | ) | |||||||||||
CleantechTM Portfolio | — | (1,171,839 | ) | 906,794 | 8,949,455 | (8,042,661 | ) | (265,045 | ) | ||||||||||||||||||
DWA Technical LeadersTM Portfolio | — | (5,046,566 | ) | 15,572,442 | 23,582,651 | (8,010,209 | ) | 10,525,876 | |||||||||||||||||||
Golden Dragon Halter USX China Portfolio | — | (5,382,727 | ) | (77,828,672 | ) | 26,987,746 | (104,816,418 | ) | (83,211,399 | ) | |||||||||||||||||
Listed Private Equity Portfolio | 469,435 | (4,388,498 | ) | (38,251,065 | ) | 4,574,130 | (42,825,195 | ) | (42,170,128 | ) | |||||||||||||||||
Lux Nanotech Portfolio | — | (4,779,985 | ) | (25,496,886 | ) | 4,617,295 | (30,114,181 | ) | (30,276,871 | ) | |||||||||||||||||
S&P 500 BuyWrite Portfolio | 127,888 | — | (42,579 | ) | 213,967 | (256,546 | ) | 85,309 | |||||||||||||||||||
Value Line Industry Rotation Portfolio | — | (3,798,072 | ) | 1,724,280 | 3,646,520 | (1,922,240 | ) | (2,073,792 | ) | ||||||||||||||||||
Value Line TimelinessTM Select Portfolio | — | (49,767,441 | ) | 3,169,193 | 14,534,028 | (11,364,835 | ) | (46,598,248 | ) | ||||||||||||||||||
Water Resources Portfolio | 229,824 | (15,429,970 | ) | 92,251,724 | 249,963,898 | (157,712,174 | ) | 77,051,578 | |||||||||||||||||||
WilderHill Clean Energy Portfolio | — | (136,339,647 | ) | (218,442,032 | ) | 111,888,371 | (330,330,403 | ) | (354,781,679 | ) | |||||||||||||||||
WilderHill Progressive Energy Portfolio | — | (179,432 | ) | 1,583,200 | 6,252,166 | (4,668,966 | ) | 1,403,768 |
Distributions to Shareholders:
The tax character of distributions paid during the period ended April 30, 2008 was as follows:
Period ended April 30, 2008 | Period ended April 30, 2007 | ||||||||||
Distributions paid from Ordinary Income | Distributions paid from Ordinary Income | ||||||||||
Aerospace & Defense Portfolio | $ | 597,944 | $ | 362,663 | |||||||
DWA Technical Leaders(TM) Portfolio | 105,514 | — | |||||||||
Golden Dragon Halter USX China Portfolio | 3,881,852 | 3,191,113 | |||||||||
Listed Private Equity Portfolio(1) | 6,147,694 | 689,732 | |||||||||
S&P 500 BuyWrite Portfolio | 10,500 | — | |||||||||
Value Line Industry Rotation Portfolio | 19,266 | 2,669 | |||||||||
Water Resources Portfolio | 7,498,823 | 11,901,149 | |||||||||
WilderHill Clean Energy Portfolio | — | 1,691,001 | |||||||||
WilderHill Progressive Energy Portfolio | 193,423 | 14,162 |
82
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Period ended April 30, 2008 | Period ended April 30, 2007 | ||||||||||
Distributions paid from Return of Capital | Distributions paid from Return of Capital | ||||||||||
Aerospace & Defense Portfolio | $ | — | $ | 25,620 | |||||||
DWA Techical LeadersTM Portfolio | 57,242 | — | |||||||||
Golden Dragon Halter USX China Portfolio | 198,502 | — | |||||||||
Value Line Industry Rotation Portfolio | 1,384 | 4,445 | |||||||||
WilderHill Clean Energy Portfolio | — | 160,324 | |||||||||
WilderHill Progressive Energy Portfolio | 9,290 | — |
At April 30, 2008, for Federal income tax purposes, the Funds have capital loss carryforwards available as shown in the table below, to the extent provided by the regulations, to offset future capital gains through the years indicated. To the extent that these loss carryforwards are used to offset future capital gains, it is probable that the capital gains so offset will not be distributed to shareholders. The use of some portion of the capital loss carryforward by any one fund may be limited by federal tax rules. These rules limit the use of the carryforward when there has been a greater than fifty percent change in ownership of a fund.
Year of Expiration | Total | ||||||||||||||||||
2014 | 2015 | 2016 | Amount | ||||||||||||||||
Aerospace & Defense Portfolio | $ | — | $ | 104,662 | $ | 2,374,303 | $ | 2,478,965 | |||||||||||
CleantechTM Portfolio | — | — | 1,171,839 | 1,171,839 | |||||||||||||||
DWA Technical LeadersTM Portfolio | — | — | 5,046,566 | 5,046,566 | |||||||||||||||
Golden Dragon Halter USX China Portfolio | 1,018,146 | 3,128,677 | 1,235,904 | 5,382,727 | |||||||||||||||
Listed Private Equity Portfolio | — | — | 4,388,498 | 4,388,498 | |||||||||||||||
Lux Nanotech Portfolio | — | 3,986,980 | 793,005 | 4,779,985 | |||||||||||||||
S&P 500 BuyWrite Portfolio | — | — | — | — | |||||||||||||||
Value Line Industry Rotation Portfolio | — | — | 3,798,072 | 3,798,072 | |||||||||||||||
Value Line TimelinessTM Select Portfolio | — | 28,753,751 | 21,013,690 | 49,767,441 | |||||||||||||||
Water Resources Portfolio | — | 11,876,489 | 3,553,481 | 15,429,970 | |||||||||||||||
WilderHill Clean Energy Portfolio | 2,098,368 | 89,533,576 | 44,707,703 | 136,339,647 | |||||||||||||||
WilderHill Progressive Energy Portfolio | — | — | 179,432 | 179,432 |
Capital losses incurred after October 31 ("post-October losses") within the taxable year deemed to arise on the first business day of each Fund's next taxable year.
83
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
During the period ended April 30, 2008, the Funds incurred and will elect to defer net capital losses as follows:
Post-October Losses | |||||||
Aerospace & Defense Portfolio | $ | 6,563,375 | |||||
CleantechTM Portfolio | 4,166,271 | ||||||
DWA Technical LeadersTM Portfolio | 25,948,611 | ||||||
Golden Dragon Halter USX China Portfolio | 12,330,853 | ||||||
Listed Private Equity Portfolio | 2,929,968 | ||||||
Lux Nanotech Portfolio | 12,743,022 | ||||||
S&P 500 BuyWrite Portfolio | 46,706 | ||||||
Value Line Industry Rotation Portfolio | 3,279,810 | ||||||
Value Line TimelinessTM Select Portfolio | 20,130,206 | ||||||
Water Resources Portfolio | 35,247,744 | ||||||
WilderHill Clean Energy Portfolio | 31,930,896 | ||||||
WilderHill Progressive Energy Portfolio | 4,392,128 |
In order to present shares of beneficial interest and accumulated net realized gains or losses on the Statements of Assets and Liabilities that more closely represent their tax character, certain adjustments have been made to shares of beneficial interest, undistributed net investment income or loss and net realized gains or losses on investments. The differences are primarily due to redemptions in-kind, investments in partnerships, wash sales, book equalization and net operating loss, if any. These adjustments have no effect on net assets. For the period ended April 30, 2008, the adjustments were as follows:
Undistributed Net Investment Income (Loss) | Undistributed Capital Gains/ (Accumulated Losses) | Shares of Beneficial Interest | |||||||||||||
Aerospace & Defense Portfolio | $ | (15,071 | ) | $ | (37,559,935 | ) | 37,575,006 | ||||||||
CleantechTM Portfolio | 418,636 | (11,913,636 | ) | 11,495,000 | |||||||||||
DWA Technical LeadersTM Portfolio | (399,679 | ) | (11,541,314 | ) | 11,940,993 | ||||||||||
Golden Dragon Halter USX China Portfolio | 330,916 | (242,082,169 | ) | 241,751,253 | |||||||||||
Listed Private Equity Portfolio | 31,376 | (3,788,532 | ) | 3,757,156 | |||||||||||
Lux Nanotech Portfolio | 137,884 | (5,295,288 | ) | 5,157,404 | |||||||||||
S&P 500 BuyWrite Portfolio | (14,403 | ) | — | 14,403 | |||||||||||
Value Line Industry Rotation Portfolio | 7,982 | (6,141,994 | ) | 6,134,012 | |||||||||||
Value Line TimelinessTM Select Portfolio | 183,722 | (44,539,750 | ) | 44,356,028 | |||||||||||
Water Resources Portfolio | (434,907 | ) | (161,583,206 | ) | 162,018,113 | ||||||||||
WilderHill Clean Energy Portfolio | 4,854,282 | (288,477,657 | ) | 283,623,375 | |||||||||||
WilderHill Progressive Energy Portfolio | (13,075 | ) | (2,624,361 | ) | 2,637,436 |
84
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 6. Investment Transactions
For the period ended April 30, 2008, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, money market funds and in-kind transactions, were as follows:
Purchases | Sales | ||||||||||
Aerospace & Defense Portfolio | $ | 43,633,599 | $ | 39,946,318 | |||||||
CleantechTM Portfolio | 16,506,636 | 16,895,785 | |||||||||
DWA Technical LeadersTM Portfolio | 180,548,609 | 182,809,292 | |||||||||
Golden Dragon Halter USX China Portfolio | 95,915,007 | 91,806,915 | |||||||||
Listed Private Equity Portfolio | 43,450,499 | 40,755,871 | |||||||||
Lux Nanotech Portfolio | 55,692,308 | 52,820,795 | |||||||||
S&P 500 BuyWrite Portfolio | 571,234 | 384,318 | |||||||||
Value Line Industry Rotation Portfolio | 30,137,857 | 30,293,422 | |||||||||
Value Line TimelinessTM Select Portfolio | 210,068,941 | 214,500,712 | |||||||||
Water Resources Portfolio | 521,881,659 | 444,506,991 | |||||||||
WilderHill Clean Energy Portfolio | 345,040,776 | 246,935,329 | |||||||||
WilderHill Progressive Energy Portfolio | 14,784,625 | 16,430,570 |
For the period ended April 30, 2008, in-kind transactions were as follows:
Securities Received | Securities Delivered | ||||||||||
Aerospace & Defense Portfolio | $ | 302,660,948 | $ | 245,119,284 | |||||||
CleantechTM Portfolio | 121,565,415 | 36,251,197 | |||||||||
DWA Technical LeadersTM Portfolio | 469,363,922 | 189,587,575 | |||||||||
Golden Dragon Halter USX China Portfolio | 816,843,690 | 811,440,862 | |||||||||
Listed Private Equity Portfolio | 74,082,165 | 77,835,487 | |||||||||
Lux Nanotech Portfolio | 20,657,073 | 73,233,499 | |||||||||
S&P 500 BuyWrite Portfolio | 7,436,900 | — | |||||||||
Value Line Industry Rotation Portfolio | 98,688,142 | 89,711,506 | |||||||||
Value Line TimelinessTM Select Portfolio | 410,264,990 | 489,883,361 | |||||||||
Water Resources Portfolio | 948,783,572 | 553,526,670 | |||||||||
WilderHill Clean Energy Portfolio | 1,276,335,800 | 823,754,193 | |||||||||
WilderHill Progressive Energy Portfolio | 65,524,342 | 22,834,966 |
Gains on in-kind transactions are not considered taxable gains for Federal income tax purposes.
Note 7. Trustees' Fees
The Funds (except for S&P 500 BuyWrite Portfolio) compensate each Trustee on behalf of the Trust who is not an employee of the Trust or its affiliates. With respect to S&P 500 BuyWrite Portfolio, the Adviser, as a result of the unitary management fee, compensates each Trustee on behalf of the Fund. Interested Trustees and Officers of the Trust do not receive any Trustees' fees.
The Trust (has adopted a deferred compensation plan (the "Plan"). Under the Plan, a trustee who is not an "interested person" (as defined in the 1940 Act) and has elected to participate in the Plan (a "participating trustee") may defer receipt of all or a portion of his compensation ("Deferral Fees"). Such Deferred Fees
85
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
are deemed to be invested in selected PowerShares Funds. The Deferral Fees payable to the participating trustee is valued as of the first business dates of each calendar quarter such Fees would have been paid to the participating trustee. The value increases with contributions or with increases in the value of the shares selected, and the value decreases with withdrawals or with declines in the value of the shares selected.
Note 8. Capital
Shares are created and redeemed by the Trust only in Creation Unit size aggregations of 100,000. Only authorized participants are permitted to create or redeem from the Funds. Such transactions are generally permitted on an in-kind basis, with a balancing cash component to equate the transaction to the net asset value per unit of each Fund of the Trust on the transaction date. Cash may be substituted equivalent to the value of certain securities generally when they are not available in sufficient quantity for delivery, not be eligible for trading by the Authorized Participant or as a result of other market circumstances.
Note 9. Indemnifications
Under the Trust's organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust's maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
Note 10. New Accounting Pronouncement
On September 20, 2006, the FASB released Statement of Financial Accounting Standards No. 157 "Fair Value Measurement" ("FAS 157"). FAS 157 establishes an authoritative definition of fair value, sets out a framework for measuring fair value, and requires additional disclosures about fair-value measurement. The application of FAS 157 is required for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. Management has assessed the application of FAS 157 to the Funds and has determined that the adoption of FAS 157 is not expected to have a material impact on the Funds. Management intends for the Funds to adopt FAS 157 provisions during the fiscal year ending April 30, 2009.
In March 2008, the Financial Accounting Standards Board (FASB) issued FASB Statement No. 161, Disclosures about Derivative Instruments and Hedging Activities. The standard is intended to improve financial reporting about derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entity's financial position and financial performance. It is effective for financial statements issued for fiscal years beginning after November 15, 2008. Management is currently in the process of determining the impact of the standard on the S&P 500 BuyWrite Portfolio financial statements.
86
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of each of the portfolios indicated in Note 1 of the financial statements (each a portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the "Trust") at April 30, 2008, and the results of each of their operations, the changes in each of their net assets, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Trust's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2008 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
New York, New York
June 30, 2008
87
Supplemental Information
Federal Income Tax Information
The percentages of investment income (dividend income plus short-term gains, if any) qualify as follows:
Qualified dividend income | Dividends-received deduction | ||||||||||
Aerospace & Defense Portfolio | 100 | % | 100 | % | |||||||
Cleantech(TM) Portfolio | 0 | % | 0 | % | |||||||
DWA Technical Leaders(TM) Portfolio | 0 | % | 0 | % | |||||||
Golden Dragon Halter USX China Portfolio | 100 | % | 0 | % | |||||||
Listed Private Equity Portfolio | 100 | % | 100 | % | |||||||
Lux Nanotech Portfolio | 0 | % | 0 | % | |||||||
S&P 500 BuyWrite Portfolio | 100 | % | 100 | % | |||||||
Value Line Industry Rotation Portfolio | 100 | % | 100 | % | |||||||
Value Line Timeliness(TM) Select Portfolio | 0 | % | 0 | % | |||||||
Water Resources Portfolio | 100 | % | 100 | % | |||||||
WilderHill Clean Energy Portfolio | 100 | % | 100 | % | |||||||
WilderHill Progressive Energy Portfolio | 100 | % | 100 | % |
88
Supplemental Information (Continued)
Trustees and Officers
The Trustees who are not affiliated with the Adviser or affiliates of the Adviser ("Independent Trustees") and the Trustee who is affiliated with the Adviser ("Management Trustee") and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by the Trustee, are shown below.
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex ** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Ronn R. Bagge (b. 1958) YQA Capital Management, LLC 1755 S. Naperville Rd., Suite 100 Wheaton, IL 60187 | Trustee | Since 2003 | YQA Capital Management LLC (July 1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider) | 104 | None | ||||||||||||||||||
Marc M. Kole (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | Assistant Vice President and Controller, Priority Health (September 2005- April 2008); formerly, Interim CFO, Priority Health (July 2006-April 2007); formerly Senior Vice President of Finance, United Healthcare (health insurance) (July 2004-July 2005); formerly Senior Vice President of Finance, Oxford Health Plans (June 2000-July 2004) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
89
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex ** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
D. Mark McMillan (b. 1963) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Partner, Bell, Boyd & Lloyd LLP (1989-Present) | 104 | None | ||||||||||||||||||
Philip M. Nussbaum (b. 1961) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (formerly Betzold, Berg, Nussbaum & Heitman, Inc.) (November 2004-Present); formerly Managing Director, Communication Institute (May 2002-August 2003); formerly Executive Vice President of Finance, Betzold, Berg, Nussbaum & Heitman, Inc. (March 1994-1999) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
90
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex ** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Donald H. Wilson (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | President, Chief Operating Officer, and Chief Financial Officer, AMCORE Financial, Inc. (bank holding company) (August 2007- Present), formerly, Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (February 2006- August 2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (May 1995- February 2006) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
91
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex *** Overseen by Trustees | Other Directorships Held by Trustee | ||||||||||||||||||
H. Bruce Bond (b.1963)** Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chairman of the Board, Trustee and Chief Executive Officer | Since 2003 | Managing Director, Invesco PowerShares Capital Management LLC (August 2002- Present); formerly Manager, Nuveen Investments (April 1998- August 2002) | 104 | None | ||||||||||||||||||
Availability of Additional Information About Funds' Trustees
The Statement of Additional Information includes additional information about the Funds' Trustees and is available, without charge, upon request at 800.337.4246.
* This is the date the Management Trustee began serving the Trust.
** Interested person as defined in Section 2(a)(19) of the 1940 Act.
*** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
92
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Officers | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | ||||||||||||
Bruce T. Duncan (b. 1954) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Financial Officer, Treasurer and Secretary | Chief Financial Officer and Treasurer Since 2006 Secretary Since 2008 | Senior Vice President of Finance, Invesco PowerShares Capital Management LLC (September 2005-Present); Private Practice Attorney (2000-2005); Vice President of Investor Relations, The ServiceMaster Company (1994-2000); Vice President of Taxes, The ServiceMaster Company (1990-2000) | ||||||||||||
Kevin R. Gustafson (b. 1965) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Compliance Officer | Since 2004 | General Counsel, Invesco PowerShares Capital Management LLC (September 2004-Present); Chief Compliance Officer, Invesco PowerShares Capital Management LLC (September 2004-April 2008); Attorney, Nyberg & Gustafson (2001-2004); Attorney, Burke, Warren, McKay & Serritella, P.C. (1997-2000) | ||||||||||||
* This is the period for which the Officers began serving the Trust. Each Officer serves a one year term, until his successor is elected.
93
Board Considerations Regarding Continuation of Investment
Advisory Agreement
At a meeting held on April 18, 2008, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the "Trust"), including the Independent Trustees, unanimously approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the "Adviser") and the Trust for the following 70 series (the "Funds"):
PowerShares Dynamic Market Portfolio
PowerShares Dynamic OTC Portfolio
PowerShares Golden Dragon Halter USX China Portfolio
PowerShares High Yield Equity Dividend AchieversTM Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Mid Cap Growth Portfolio
PowerShares Dynamic Mid Cap Value Portfolio
PowerShares Dynamic Small Cap Growth Portfolio
PowerShares Dynamic Small Cap Value Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Zacks Micro Cap Portfolio
PowerShares Aerospace & Defense Portfolio
PowerShares Dynamic Hardware & Consumer Electronics Portfolio
PowerShares Dynamic Telecommunications & Wireless Portfolio
PowerShares Value Line Timeliness Select Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares High Growth Rate Dividend AchieversTM Portfolio
PowerShares Zacks Small Cap Portfolio
PowerShares Dynamic Building and Construction Portfolio
PowerShares Dynamic Energy Exploration and Production Portfolio
PowerShares Dynamic Insurance Portfolio
PowerShares Dynamic Oil and Gas Services Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Utilities Portfolio
PowerShares Lux Nanotech Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares Water Resources Portfolio
PowerShares Dynamic Energy Sector Portfolio
PowerShares Dynamic Financial Sector Portfolio
PowerShares Dynamic Healthcare Sector Portfolio
PowerShares Dynamic Industrials Sector Portfolio
PowerShares Dynamic Large Cap Portfolio
PowerShares Dynamic MagniQuant Portfolio
PowerShares Dynamic Mid Cap Portfolio
PowerShares Dynamic Small Cap Portfolio
PowerShares Dynamic Technology Sector Portfolio
PowerShares Buyback AchieversTM Portfolio
PowerShares FTSE RAFI Basic Materials Sector Portfolio
PowerShares FTSE RAFI Consumer Goods Sector Portfolio
PowerShares FTSE RAFI Consumer Services Sector Portfolio
PowerShares FTSE RAFI Energy Sector Portfolio
PowerShares FTSE RAFI Financials Sector Portfolio
PowerShares FTSE RAFI Health Care Sector Portfolio
PowerShares FTSE RAFI Industrials Sector Portfolio
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
94
Board Considerations Regarding Continuation of Investment
Advisory Agreement (Continued)
PowerShares FTSE RAFI Utilities Sector Portfolio
PowerShares Cleantech Portfolio
PowerShares Dynamic Aggressive Growth Portfolio
PowerShares Dynamic Banking Portfolio
PowerShares Dynamic Basic Materials Sector Portfolio
PowerShares Dynamic Consumer Discretionary Sector Portfolio
PowerShares Dynamic Consumer Staples Sector Portfolio
PowerShares Dynamic Healthcare Services Portfolio
PowerShares Dynamic Deep Value Portfolio
PowerShares Financial Preferred Portfolio
PowerShares Listed Private Equity Portfolio
PowerShares DWA Technical Leaders Portfolio
PowerShares Value Line Industry Rotation Portfolio
PowerShares WilderHill Progressive Energy Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as the Funds grow, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered and amounts paid to other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser's services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser's current organization, including operations assistance provided by the Adviser's parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser's portfolio transaction policies and procedures. The Trustees reviewed information on the performance of the Funds and the performance of their benchmark indices. The Trustees also reviewed reports on the correlation and tracking error between the underlying index and each Fund's performance and reviewed a report of Ibbotson Associates, a c onsultant to the Independent Trustees, that analyzed the reasons for any tracking error for certain of the Funds, which the Adviser then applied to its analysis of the tracking error between the underlying index and the performance of each Fund. The Trustees noted that, in each case, the correlation and tracking error was within the range set forth in the registration statement. The Trustees also concluded that each of the Funds is correlated to its underlying index and that the tracking error for each Fund was within a reasonable range in that Fund's particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds' administrator, custodian and transfer agent. They noted the significant amount of time and effort that had been devoted to this oversight function.
Based on their review, the Trustees found that the nature and extent of services provided to the Funds under the Investment Advisory Agreement are appropriate and that the quality is good.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund's expense ratio and the advisory fee, as compared to three categories of comparable
95
Board Considerations Regarding Continuation of Investment
Advisory Agreement (Continued)
funds selected by Lipper Inc., an independent source: exchange-traded index funds ("ETFs"), open-end (non-ETF) index funds and open-end actively-managed funds. The Adviser supplemented the information prepared by Lipper Inc. with data it compiled on expense ratios and advisory fees of newer ETFs that recently commenced operations. The Trustees noted that the annual advisory fee charged to the Funds was identical (0.50% of average net assets), except for the advisory fee for the PowerShares High Yield Equity Dividend AchieversTM Portfolio, the PowerShares Dividend AchieversTM Portfolio, the PowerShares High Growth Rate Dividend AchieversTM Portfolio and the PowerShares International Dividend AchieversTM Portfolio (for each of which the annual advisory fee was 0.40% of average net assets), and that the Adviser had agreed to waive the fee and/or pay expenses to the extent necessary to pre vent the annual operating expenses of each Fund (excluding interest expenses, licensing fees and offering costs (for all Funds other than the initial two Funds, the PowerShares Dynamic OTC Portfolio and the PowerShares Dynamic Market Portfolio), brokerage commissions and other trading expenses, taxes and extraordinary expenses) from exceeding 0.60% of average net assets (0.50% of average net assets for the PowerShares High Yield Equity Dividend AchieversTM Portfolio, the PowerShares Dividend AchieversTM Portfolio, the PowerShares High Growth Rate Dividend AchieversTM Portfolio and the PowerShares International Dividend AchieversTM Portfolio) at least until April 30, 2009. The Trustees noted that the Adviser represented that it does not provide investment management services to clients other than the Trust and other exchange-traded funds overseen by the Board. The Trustees noted that the advisory fees were at the higher end of the ETF peer funds, but were lower than the median of the open-end actively-managed peer funds. The Trustees determined that the advisory fees were reasonable because of the complexity of the indices, which generally require more frequent rebalancing of the portfolios, the distinguishing factors of the Funds, and the higher administrative, operational and management oversight costs for the Adviser. With respect to the Funds' expense ratios, the Trustees noted that the net expense ratios were at the higher end of the ETF peer funds, but were generally lower than the median of the expense ratios of the open-end (non-ETF) index peer funds and the median of the open-end actively-managed peer funds. The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds. The Board concluded that the advisory fee and expense ratio of each Fund are competitive and that the advisory fee for each Fund is reasonable and appropriate in amount in light of the quality of services provided and the expense cap in place.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability as well as any profits realized by the Adviser from its relationship to each Fund. The Trustees concluded that the profitability to the Adviser of the advisory services provided to the Funds is not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund's asset size, expense ratio, expense limitation agreed to by the Adviser and whether the investment process produced economies of scale. The Trustees noted that certain fixed costs associated with the management of the Funds are being reduced on a per-Fund basis as additional Funds are added, and that the gradual reduction of the per-Fund cost enabled the Adviser to operate some of the Funds under the expense cap, which potentially would lower the costs to shareholders. The Trustees noted that
96
Board Considerations Regarding Continuation of Investment
Advisory Agreement (Continued)
the Excess Expense Agreement with the Trust provided that the Adviser was entitled to be reimbursed by each Fund for fees waived or expenses absorbed pursuant to the expense cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its expense cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds, and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
97
Board Considerations Regarding Approval of Investment Advisory Agreement (PowerShares S&P 500 BuyWrite Portfolio)
At a meeting held on December 18, 2007, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the "Trust"), including the Independent Trustees, approved the Investment Advisory Agreement between PowerShares Capital Management LLC (the "Adviser") and the Trust for the PowerShares S&P 500 BuyWrite Portfolio (the "Fund").
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services to be provided, (ii) since Fund performance was not available, the correlation and tracking error between the indices tracked by other exchange-traded funds ("ETFs") for which the Adviser serves as such and those funds' performance, (iii) the costs of services to be provided and estimated profits to be realized by the Adviser, (iv) the extent to which economies of scale may be realized as the Fund grows, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered and amounts paid to other registered investment companies and (vii) any benefits to be realized by the Adviser from its relationship with the Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to appr ove the Investment Advisory Agreement for the Fund. No single factor was determinative in the Board's analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser's services, the Trustees reviewed information concerning the functions to be performed by the Adviser, information describing the Adviser's current organization and projected staffing, and the background and experience of the persons responsible for the day-to-day management of the Fund, and considered the quality of services provided by the Adviser to other ETFs. The Trustees reviewed matters related to the Adviser's portfolio transaction policies and procedures. The Trustees reviewed reports on the correlation and tracking error between the underlying indices and the performance of other ETFs for which the Adviser serves as investment adviser.
The Trustees also considered the services to be provided by the Adviser in its oversight of the Fund's administrator, custodian and transfer agent. They noted the significant amount of time and effort that had been devoted to this oversight function for the other ETFs and that was expected to be provided for the Fund.
Based on their review, the Trustees concluded that the nature and extent of services to be provided by the Adviser to the Fund were appropriate and that the quality was expected to be good.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on the Fund's expected total expense ratio and proposed advisory fee, as compared to information prepared by Lipper Inc., an independent source, on expense ratios and advisory fees of a broad universe of ETFs and other index funds. The Adviser supplemented the information prepared by Lipper Inc. with data it compiled on expense ratios and advisory fees of newer ETFs that recently commenced operations. The Trustees also considered data from an August 2007 report by Morgan Stanley, Inc. showing average expense ratios for various types of ETFs and open-end funds, including index funds. The Trustees noted that the annual advisory fee to be charged to the Fund was a unitary fee, and that the Adviser agreed to pay all expenses of the Fund except bro kerage commissions and other trading expenses, taxes and extraordinary expenses. The Trustees noted that the advisory fee was at the higher end of the ETF universe, but generally was lower than fees for open-end (non-ETF) funds and closed-end funds, and was reasonable because of the complexity of the index, which requires continuous rebalancing and a monthly option overlay, other distinguishing factors of the Fund, and the higher administrative, operational and management oversight costs for the Adviser. The Trustees also noted that a portion of the higher advisory
98
Board Considerations Regarding Approval of Investment Advisory Agreement (PowerShares S&P 500 BuyWrite Portfolio) (Continued)
fee was attributable to a higher license fee payable out of the unitary fee to be charged to the Fund. The Board noted that the Adviser represented that the advisory fee was competitive with those of its ETF peers, and that it was consistent with the fee to be paid by two other series of the Trust that are to track the performance of other equity indices with associated option writing. The Board concluded that the advisory fee and expected total expense ratio of the Fund are reasonable and appropriate in amount in light of the quality of services expected to be provided.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser as investment adviser to the other ETFs, as well as the fees waived and expenses reimbursed by the Adviser for those ETFs. The Trustees reviewed information provided by the Adviser on its profitability as well as any profits realized by the Adviser from its relationship to those ETFs. The Trustees noted the Adviser's statement that its costs of managing those ETFs generally exceeded the amount payable as management fees under the investment advisory agreement for those funds. The Trustees concluded that the estimated profits to be realized by the Adviser with respect to the Fund appeared to be reasonable in comparison with the costs of providing investment advisory services to the Fund.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as the Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees noted that certain fixed costs associated with the management of the Fund can be reduced on a per-Fund basis, and that although such economies would be enjoyed by the Adviser, a unitary fee provides certainty in expenses for the Fund. The Trustees considered whether the advisory fee rate for the Fund is reasonable in relation to the projected asset size of the Fund, and concluded that the flat advisory fee was reasonable and appropriate.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Fund, and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the Investment Advisory Agreement for the Fund. No single factor was determinative in the Board's analysis.
99
This page intentionally left blank
PROXY VOTING POLICIES AND PROCEDURES
A description of the Funds' proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 337-4246. This information is also available on the Securities and Exchange Commission's ("Commission") website at www.sec.gov.
Information regarding how the Funds voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 337-4246; or (ii) accessing the Funds' Form N-PX on the Commission's website at www.sec.gov.
QUARTERLY PORTFOLIOS
The Funds file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds' Forms N-Q are available on the Commission's website at www.sec.gov. The Funds' Forms N-Q may also be reviewed and copied at the Commission's Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
There are risks involved in investing in ETFs, including possible loss of money. Investing in securities of small and medium sized companies involves greater risk than is customarily associated with investing in more established companies, and investments in concentrated industry sectors involve greater risks than investments that are more diversified. PowerShares ETFs are not actively managed and are subject to risks similar to stocks, including those related to short selling and margin maintenance. PowerShares ETFs are not FDIC insured, may lose value and have no bank guarantee. PowerShares is a registered trademark of Invesco PowerShares Capital Management LLC. Past performance is not a guarantee of future results.
Invesco Aim Distributors, Inc. is the distributor of the PowerShares Exchange-Traded Fund Trust.
An investor should consider each Fund's investment objective, risks, charges and expenses carefully before investing. For more complete information about PowerShares ETFs call Invesco Aim Distributors, Inc. at (800) 337-4246 or visit our website invescopowershares.com for a prospectus. Please read the prospectus carefully before investing.
301 West Roosevelt Road
Wheaton, IL 60187
800.983.0903
www.invescopowershares.com
© 2008 Invesco PowerShares Capital Management LLC P-PS-AR-4
2008 Annual Report to Shareholders
30 April 2008
PowerShares Dynamic Banking Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Building & Construction Portfolio
PowerShares Dynamic Energy Exploration & Production Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Hardware & Consumer Electronics Portfolio
PowerShares Dynamic Healthcare Services Portfolio
PowerShares Dynamic Insurance Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Oil & Gas Services Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
Table of Contents
Shareholder Letter | 2 | ||||||
The Market Environment | 3 | ||||||
Manager's Analysis | 4 | ||||||
Funds' Distribution History | 36 | ||||||
Frequency Distribution of Discounts & Premiums | 38 | ||||||
Fees and Expenses | 40 | ||||||
Industry Portfolios | |||||||
Schedules of Investments | |||||||
PowerShares Dynamic Banking Portfolio | 42 | ||||||
PowerShares Dynamic Biotechnology & Genome Portfolio | 43 | ||||||
PowerShares Dynamic Building & Construction Portfolio | 44 | ||||||
PowerShares Dynamic Energy Exploration & Production Portfolio | 45 | ||||||
PowerShares Dynamic Food & Beverage Portfolio | 46 | ||||||
PowerShares Dynamic Hardware & Consumer Electronics Portfolio | 47 | ||||||
PowerShares Dynamic Healthcare Services Portfolio | 48 | ||||||
PowerShares Dynamic Insurance Portfolio | 49 | ||||||
PowerShares Dynamic Leisure and Entertainment Portfolio | 50 | ||||||
PowerShares Dynamic Media Portfolio | 51 | ||||||
PowerShares Dynamic Networking Portfolio | 52 | ||||||
PowerShares Dynamic Oil & Gas Services Portfolio | 53 | ||||||
PowerShares Dynamic Pharmaceuticals Portfolio | 54 | ||||||
PowerShares Dynamic Retail Portfolio | 55 | ||||||
PowerShares Dynamic Semiconductors Portfolio | 56 | ||||||
PowerShares Dynamic Software Portfolio | 57 | ||||||
Statements of Assets and Liabilities | 58 | ||||||
Statements of Operations | 60 | ||||||
Statements of Changes in Net Assets | 62 | ||||||
Financial Highlights | 68 | ||||||
Notes to Financial Statements | 76 | ||||||
Report of Independent Registered Public Accounting Firm | 88 | ||||||
Supplemental Information | 89 | ||||||
Information about Advisory Agreement | 94 | ||||||
To My Fellow Investors,
It gives me great pleasure to report on the state of your investment in PowerShares Exchange-Traded Funds and to thank you for your continued confidence in Invesco PowerShares Capital Management LLC.
Invesco PowerShares has accomplished a number of corporate and industry achievements in 2007. Some of the most notable successes over the past 12 months are that PowerShares:
• Was the first to receive approval from the SEC to operate actively managed equity and fixed-income ETFs.
• Launched our initial group of international ETFs, which invest directly in securities listed on foreign exchanges. As of April 30, 2008, we had 17 ETFs allowing investors to invest across a wide geographic range.
• Brought out the markets only ETFs investing in insured municipal bonds. These three ETF's were part of our initial entry into the Fixed Income portion of the investment spectrum.
• Further enhanced our reputation as one of the leading innovators in the ETF marketplace when the PowerShares S&P Buy-Write Portfolio was awarded the most innovative new ETF for 2007.
• Expanded our global footprint with the introduction of 14 PowerShares ETFs listed on four major stock exchanges across Europe (London, Milan, Frankfurt and Paris).
• Launched the PowerShares India Portfolio, one of the first ETFs to provide U.S. investors with direct access to securities listed on the India stock exchange.
Another milestone of the past year was the adoption of our new name, Invesco PowerShares – in short, we have a new corporate name. Invesco PowerShares represents the strength of global diversification you get through the combination of Invesco's worldwide resources and PowerShares' market leading ETF capabilities. As one of the world's largest and most diversified global investment organizations, Invesco has more than 500 investment professionals operating in investment centers in 25 cities, a presence in 12 countries and $500 billion in assets under management globally at the end of 2007.
While our name has changed and we have a new corporate logo, our goal of delivering the highest quality investment management available in the ETF structure has not changed and all of the names of your funds and their trading symbols remain the same – as do all of our telephone contact numbers. All of us at Invesco PowerShares will continue to strive to provide you with compelling investment solutions and high-quality customer service. Regardless of market conditions, Invesco PowerShares will hold true to its mission: seeking to build financial security for investors.
Best regards,
H. Bruce Bond
President and Chairman of the Board of Trustees
PowerShares Exchange-Traded Fund Trust
2
The Market Environment
Although the benchmark S&P 500 index hit an all-time high in October, 2007, it capitulated as the subprime mortgage crisis began to negatively affect the balance sheets of major U.S. financial institutions. As a result, volatility (as measured by the CBOE "VIX" index) increased by 46.2% during the April 30, 2007 to April 30, 2008 reporting period. Another dramatic rise over the same timeframe was the price of crude oil, which rallied 72.7%. U.S. economic growth began to slow significantly in Q1 2008, leading to recession concerns addressed by the Federal Reserve Bank through aggressive monetary policy easing (the Fed Fund target rate was cut by 2.25% in 2008). The combination of lower short-term U.S. interest rates and the recycling of petrodollars into European banks caused the U.S. dollar to weaken versus all G7 currencies for the year ended April 30, 2008.
By March, 2008, even the AAA-rated monoline bond insurers succumbed to the U.S. credit crunch. Bond insurer ratings downgrades led to huge displacements within the municipal bond market. An impending liquidity crisis was quelled in mid-March by the Fed via the creation of a $200bn lending facility and the approval of Bear Stearns' sale to JP Morgan. Along with the restoration of confidence in the U.S. financial system came a respectable April rally in the U.S. equity market, leaving the S&P 500 with a yearly total return of -4.68% over the reporting period while the DJIA was 0.47% and the NASDAQ-100 was +3.18%. For the same period, the Lehman Brothers U.S. Aggregate Total Return bond index was 6.87%.
3
Manager's Analysis
PowerShares Dynamic Banking Portfolio (ticker: PJB)
The PowerShares Dynamic Banking Portfolio is based on the Dynamic Banking IntellidexSM Index. The Index thoroughly evaluates companies based on a variety of investment merit criteria, including fundamental growth, stock valuation, investment timeliness and risk factors. Securities shown to possess the greatest capital appreciation potential are selected by the Index and incorporated by the portfolio manager.
The PowerShares Dynamic Banking Portfolio returned -15.80% compared to the Dow Jones Regional Banks Index which returned -26.25%. The portfolio was heavily weighed in the commercial banks industry with slight exposure to the thrifts & mortgage finance and the diversified financial services industries. Within commercial banks, the companies which were laggards and weighed heavily on performance were Comerica, KeyCorp, First Bancorp of Puerto Rico, M&T Bank Corporation and First Citizens. Community Bank System, Westamerica Bancorp and First Financial Bankshares contributed positively to the Fund's performance.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Commercial Banks-Central US | 19.9 | ||||||
Super-Regional Banks-US | 18.4 | ||||||
Commercial Banks-Western US | 13.9 | ||||||
Commercial Banks-Eastern US | 13.4 | ||||||
Commercial Banks-Southern US | 13.3 | ||||||
S&L/Thrifts-Eastern US | 10.9 | ||||||
Finance-Investment Banker/Broker | 5.4 | ||||||
Fiduciary Banks | 5.0 | ||||||
Money Market Fund | 0.1 | ||||||
Other | (0.3 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Small-Cap Value | 47.1 | ||||||
Mid-Cap Value | 23.1 | ||||||
Large-Cap Value | 19.4 | ||||||
Small-Cap Growth | 5.4 | ||||||
Large-Cap Growth | 5.0 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
JPMorgan Chase & Co. | 5.4 | ||||||
New York Community Bancorp, Inc. | 5.3 | ||||||
UnionBanCal Corp. | 5.2 | ||||||
Northern Trust Corp. | 5.0 | ||||||
U.S. Bancorp | 4.9 | ||||||
Wells Fargo & Co. | 4.7 | ||||||
SunTrust Banks, Inc. | 4.4 | ||||||
Comerica, Inc. | 4.4 | ||||||
UMB Financial Corp. | 3.3 | ||||||
First Niagara Financial Group, Inc. | 3.2 | ||||||
Total | 45.8 |
4
Manager's Analysis (Continued)
PowerShares Dynamic Banking Portfolio (ticker: PJB)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Banking IntellidexSM Index | -15.08 | -12.64 | -18.93 | ||||||||||||
Dow Jones Regional Banks Index | -26.25 | -17.02 | -25.17 | ||||||||||||
KBW Banking Index | -25.50 | -20.25 | -29.65 |
Fund
NAV Return | -15.80 | -13.48 | -20.08 | ||||||||||||
Share Price Return | -15.83 | -13.46 | -20.09 |
Inception: 12 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 2.73%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.66% while the Fund's gross total operating expense ratio was 0.78%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Dow Jones Regional Banks Index and the KBW Banking Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 50 and 24 common stocks, respectively.
† Average annualized.
5
Manager's Analysis
PowerShares Dynamic Biotechnology & Genome Portfolio (ticker: PBE)
The PowerShares Dynamic Biotechnology & Genome Portfolio seeks to replicate, before fees and expenses, the Dynamic Biotechnology & Genome IntellidexSM Index, which is designed to provide capital appreciation by thoroughly evaluating companies based on a variety of investment merit criteria, including fundamental growth, stock valuation, investment timeliness and risk factors.
The PowerShares Dynamic Biotechnology & Genome Portfolio returned -7.93% which underperformed the performance of the S&P Composite Biotechnology Index which returned -3.06% during the same period. The chemicals industry was the leading contributor to the Fund's performance due to holding Sigma-Aldrich which was up strong for the year. Biotechnology, life sciences tools & services and pharmaceuticals contributed the most to the Fund's underperformance for the portfolio. Biotechnology was around forty percent of the portfolio and the laggards were Protalix BioTherapeutics, Theravance and Dendreon Corporation.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Biotechnology | 42.3 | ||||||
Pharmaceuticals | 28.9 | ||||||
Electronics | 14.6 | ||||||
Healthcare-Products | 9.5 | ||||||
Chemicals | 4.9 | ||||||
Other | (0.2 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Small-Cap Growth | 44.5 | ||||||
Mid-Cap Growth | 38.8 | ||||||
Large-Cap Growth | 14.1 | ||||||
Small-Cap Value | 2.6 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Millennium Pharmaceuticals, Inc. | 8.4 | ||||||
Invitrogen Corp. | 5.3 | ||||||
Gilead Sciences, Inc. | 5.2 | ||||||
Sigma-Aldrich Corp. | 4.9 | ||||||
Waters Corp. | 4.9 | ||||||
Genzyme Corp. | 4.7 | ||||||
Applera Corp.-Applied Biosystems Group | 4.5 | ||||||
Genentech, Inc. | 4.3 | ||||||
CV Therapeutics, Inc. | 4.1 | ||||||
Alexion Pharmaceuticals, Inc. | 3.0 | ||||||
Total | 49.3 |
6
Manager's Analysis (Continued)
PowerShares Dynamic Biotechnology & Genome Portfolio (ticker: PBE)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Biotechnology & Genome IntellidexSM Index | -8.13 | 6.63 | 20.18 | ||||||||||||
S&P SuperComposite Biotechnology Index | -3.06 | 8.73 | 27.06 |
Fund
NAV Return | -7.93 | 6.85 | 20.80 | ||||||||||||
Share Price Return | -7.85 | 6.85 | 20.83 |
Fund Inception: 23 June 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.65%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.62%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Biotechnology Index is an unmanaged index used as a measurement of change in stock market conditions based on the average performance of 14 common stocks.
† Average annualized.
7
Manager's Analysis
PowerShares Dynamic Building & Construction Portfolio (ticker: PKB)
The PowerShares Dynamic Building & Construction Portfolio seeks to replicate, before fees and expenses, the Dynamic Building & Construction IntellidexSM Index. The Index thoroughly evaluates companies based on a variety of investment merit criteria, including fundamental growth, stock valuation, investment timeliness and risk factors. Securities shown to possess the greatest capital appreciation potential are selected by the Index.
The PowerShares Dynamic Building & Construction Portfolio returned -7.66% for the reporting period. The industries which contributed the most to the portfolio's underperformance were specialty retail, construction materials and chemicals. Stocks which lagged and caused drag on performance from specialty retail were Home Depot, Lowe's and Tractor Supply as the economy slowed and the housing market tumbled, these stocks were hurt. Other housing related stocks such as Vulcan Materials and Martin Marietta Materials and LSB Industries also contributed negatively to the Fund's performance.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Engineering & Construction | 24.5 | ||||||
Building Materials | 18.3 | ||||||
Machinery-Construction & Mining | 13.0 | ||||||
Metal Fabricate/Hardware | 5.2 | ||||||
Textiles | 5.2 | ||||||
Forest Products & Paper | 5.0 | ||||||
Machinery-Diversified | 4.5 | ||||||
Miscellaneous Manufacturing | 4.0 | ||||||
Electric | 3.3 | ||||||
Agriculture | 3.1 | ||||||
Storage/Warehousing | 3.0 | ||||||
Home Builders | 3.0 | ||||||
Environmental Control | 3.0 | ||||||
Retail | 2.5 | ||||||
Office Furnishings | 2.0 | ||||||
Money Market Fund | 0.3 | ||||||
Other | 0.1 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Small-Cap Growth | 24.3 | ||||||
Mid-Cap Value | 23.5 | ||||||
Mid-Cap Growth | 18.4 | ||||||
Small-Cap Value | 17.9 | ||||||
Large-Cap Value | 10.6 | ||||||
Large-Cap Growth | 5.3 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Caterpillar, Inc. | 5.5 | ||||||
Fluor Corp. | 5.3 | ||||||
Jacobs Engineering Group, Inc. | 5.2 | ||||||
Mohawk Industries, Inc. | 5.1 | ||||||
Weyerhaeuser Co. | 5.0 | ||||||
Terex Corp. | 5.0 | ||||||
Trane, Inc. | 5.0 | ||||||
Manitowoc (The) Co., Inc. | 4.5 | ||||||
Dycom Industries, Inc. | 3.3 | ||||||
Valmont Industries, Inc. | 3.2 | ||||||
Total | 47.1 |
8
Manager's Analysis (Continued)
PowerShares Dynamic Building & Construction Portfolio (ticker: PKB)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Building and Construction IntellidexSM Index | -7.37 | 6.16 | 16.25 | ||||||||||||
S&P SuperComposite Construction & Engineering Index | 32.00 | 33.94 | 108.79 | ||||||||||||
Russell 3000® Index | -5.16 | 8.14 | 21.80 |
Fund
NAV Return | -7.66 | 5.08 | 13.23 | ||||||||||||
Share Price Return | -7.72 | 5.03 | 13.13 |
Fund Inception: 26 October 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.54%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 1.18%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Construction & Engineering Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 9 and 2,918 common stocks, respectively.
† Average annualized.
9
Manager's Analysis
PowerShares Dynamic Energy Exploration & Production Portfolio (ticker: PXE)
The PowerShares Dynamic Energy Exploration & Production Portfolio seeks to replicate, before fees and expenses, the Dynamic Energy Exploration & Production IntellidexSM Index. The Index thoroughly evaluates companies based on a variety of investment merit criteria, including fundamental growth, stock valuation, investment timeliness and risk factors. Securities shown to possess the greatest capital appreciation potential are selected by the Index.
The PowerShares Dynamic Energy Exploration & Production Portfolio returned a respectable 25.69% for the year. Energy prices continued to increase throughout 2007 to record highs. The top contributors to the portfolio's performance in the oil & gas exploration & production industry were Whiting Petroleum, Apache, Forest Oil and Cimarex Energy. Hess, Occidental Petroleum and Chevron in integrated oil and gas also contributed positively to the Fund's performance. Tesoro and Sunoco were among the few energy companies that underperformed and were laggards which contributed negatively to the Fund's performance for the year.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Oil Companies-Exploration & Production | 66.8 | ||||||
Oil Companies-Integrated | 21.9 | ||||||
Oil Refining & Marketing | 5.6 | ||||||
Gas-Distribution | 2.9 | ||||||
Pipelines | 2.8 | ||||||
Other | 0.0 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 43.3 | ||||||
Mid-Cap Value | 24.3 | ||||||
Small-Cap Value | 13.7 | ||||||
Mid-Cap Growth | 10.0 | ||||||
Small-Cap Growth | 8.7 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Apache Corp. | 5.4 | ||||||
Hess Corp. | 5.3 | ||||||
Chevron Corp. | 5.1 | ||||||
Devon Energy Corp. | 5.1 | ||||||
Occidental Petroleum Corp. | 5.0 | ||||||
Exxon Mobil Corp. | 4.9 | ||||||
ConocoPhillips | 4.8 | ||||||
Petroquest Energy, Inc. | 3.3 | ||||||
Comstock Resources, Inc. | 3.2 | ||||||
Whiting Petroleum Corp. | 3.2 | ||||||
Total | 45.3 |
10
Manager's Analysis (Continued)
PowerShares Dynamic Energy Exploration & Production Portfolio (ticker: PXE)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Energy Exploration & Production IntellidexSM Index | 26.50 | 23.38 | 69.76 | ||||||||||||
S&P SuperComposite Oil & Gas Exploration & Production Index | 58.96 | 30.91 | 97.08 | ||||||||||||
Russell 3000® Index | -5.16 | 8.14 | 21.80 |
Fund
NAV Return | 25.69 | 22.87 | 67.66 | ||||||||||||
Share Price Return | 25.66 | 22.72 | 67.26 |
Fund Inception: 26 October 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.72%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.65%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Oil & Gas Exploration & Production Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 24 and 2,918 common stocks, respectively.
† Average annualized.
11
Manager's Analysis
PowerShares Dynamic Food & Beverage Portfolio (ticker: PBJ)
The PowerShares Dynamic Food & Beverage Portfolio is based on the Dynamic Food & Beverage IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Food & Beverage Portfolio returned -1.40% and underperformed the S&P Composite Food Beverage & Tobacco Index which returned 4.29% during the same period. The Fund does not hold any pure tobacco companies which the S&P Composite Food Beverage & Tobacco Index has a 25% weight this industry and these stocks were up on average 5.9%. The Fund was overweight in food products and chemicals which contributed positive to the Fund's performance. Monsanto was the largest contributor as the Fund held a 5% weight and the stock was up 94.7% for the reporting period. Food & staples retailing, industrial conglomerates and beverages were the sectors which lagged for the period with companies Winn-Dixie, Sysco, Seaboard and Hansen Natural contributing negatively to the Fund's performance.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Food-Miscellaneous/Diversified | 34.8 | ||||||
Retail-Restaurants | 16.2 | ||||||
Beverages-Non-alcoholic | 14.5 | ||||||
Food-Confectionery | 8.5 | ||||||
Brewery | 7.6 | ||||||
Food-Retail | 5.9 | ||||||
Food-Wholesale/Distributions | 5.2 | ||||||
Agricultural Chemicals | 4.7 | ||||||
Beverages-Wine/Spirits | 2.8 | ||||||
Other | (0.2 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 30.7 | ||||||
Small-Cap Value | 21.9 | ||||||
Large-Cap Growth | 20.9 | ||||||
Mid-Cap Value | 18.9 | ||||||
Mid-Cap Growth | 7.6 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Wm. Wrigley Jr. Co. | 6.0 | ||||||
Yum! Brands, Inc. | 5.6 | ||||||
McDonald's Corp. | 5.2 | ||||||
General Mills, Inc. | 5.1 | ||||||
Anheuser-Busch Cos., Inc. | 4.9 | ||||||
Kellogg Co. | 4.8 | ||||||
Monsanto Co. | 4.7 | ||||||
PepsiCo, Inc. | 4.7 | ||||||
Ruddick Corp. | 3.1 | ||||||
Sara Lee Corp. | 3.0 | ||||||
Total | 47.1 |
12
Manager's Analysis (Continued)
PowerShares Dynamic Food & Beverage Portfolio (ticker: PBJ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Food & Beverage IntellidexSM Index | -0.74 | 6.72 | 20.47 | ||||||||||||
S&P SuperComposite Food & Tobacco Products Index | 4.29 | 11.48 | 36.47 | ||||||||||||
Russell 3000® Index | -5.16 | 7.22 | 22.08 |
Fund
NAV Return | -1.40 | 6.09 | 18.36 | ||||||||||||
Share Price Return | -1.92 | 5.91 | 17.80 |
Fund Inception: 23 June 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.10%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.88%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Food & Tobacco Products Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 42 and 2,918 common stocks, respectively.
† Average annualized.
13
Manager's Analysis
PowerShares Dynamic Hardware & Consumer Electronics (ticker: PHW)
The PowerShares Dynamic Hardware & Consumer Electronics Portfolio is based on the Dynamic Hardware & Consumer Electronics IntellidexSM Index, and seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Hardware & Consumer Electronics Portfolio returned -15.00% while the comparable S&P Composite Technology Hardware & Equipment Index returned 3.39% during the period. Stock selection in computers & peripherals and communications equipment industry groups contributed to the Fund's underperformance. NetApp, Dell, Novatel and Emulex were the laggards contributing negatively to the Fund's return. Apple contributed the most to the Fund's performance as the stock was up around 75% for the reporting period and had an average weight of 5.50%.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Computers | 40.0 | ||||||
Electronics | 22.5 | ||||||
Telecommunications | 11.3 | ||||||
Machinery-Diversified | 5.6 | ||||||
Home Furnishings | 5.3 | ||||||
Semiconductors | 5.1 | ||||||
Office/Business Equipment | 4.8 | ||||||
Micellaneous Manufacturing | 2.9 | ||||||
Software | 2.3 | ||||||
Other | 0.2 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Growth | 34.7 | ||||||
Small-Cap Value | 16.5 | ||||||
Small-Cap Growth | 15.7 | ||||||
Mid-Cap Growth | 14.7 | ||||||
Mid-Cap Value | 13.6 | ||||||
Large-Cap Value | 4.8 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Apple, Inc. | 7.0 | ||||||
EMC Corp. | 5.0 | ||||||
Agilent Technologies, Inc. | 4.9 | ||||||
Hewlett-Packard Co. | 4.9 | ||||||
Sun Microsystems, Inc. | 4.8 | ||||||
Xerox Corp. | 4.7 | ||||||
Dell, Inc. | 4.7 | ||||||
Plantronics, Inc. | 3.6 | ||||||
Garmin Ltd. | 3.5 | ||||||
National Instruments Corp. | 3.1 | ||||||
Total | 46.2 |
14
Manager's Analysis (Continued)
PowerShares Dynamic Hardware & Consumer Electronics Portfolio (ticker: PHW)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Hardware & Consumer Electronics IntellidexSM Index | -14.61 | 0.29 | 0.70 | ||||||||||||
S&P SuperComposite Technology Hardware & Equipment Index | 3.39 | 7.50 | 19.02 | ||||||||||||
Russell 3000® Index | -5.16 | 5.72 | 14.33 |
Fund
NAV Return | -15.00 | -0.26 | -0.61 | ||||||||||||
Share Price Return | -15.00 | -0.27 | -0.64 |
Fund Inception: 6 December 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.83%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 1.47%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Technology Hardware & Equipment Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 107 and 2,918 common stocks, respectively.
† Average annualized.
15
Manager's Analysis
PowerShares Dynamic Healthcare Services Portfolio (ticker: PTJ)
The PowerShares Dynamic Healthcare Services Portfolio is based on the Dynamic Healthcare Services IntellidexSM Index. The Index thoroughly evaluates companies based on a variety of investment merit criteria, including fundamental growth, stock valuation, investment timeliness and risk factors. Securities shown to possess the greatest capital appreciation potential are selected by the Index.
The PowerShares Dynamic Healthcare Services returned -16.73%. The portfolio outperformed the Dow Jones Healthcare Providers Index which returned -17.48% over the same period. This was a tough year for a majority of healthcare related firms. Those stocks which contributed negatively to the Fund were UnitedHealth, Humana, WellPoint, Health Net and Lincare Holdings. An overweight position in Express Scripts contributed positively to the portfolio as the security's return was around 45% for the reporting period.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Medical-HMO | 39.8 | ||||||
Medical-Outpatient/Home Medical Care | 14.4 | ||||||
Health Care Cost Containment | 7.9 | ||||||
Pharmacy Services | 6.7 | ||||||
Life/Health Insurance | 5.4 | ||||||
Distribution/Wholesale | 3.2 | ||||||
Physician Practice Management | 3.2 | ||||||
Hazardous Waste Disposal | 3.0 | ||||||
Medical-Wholesale Drug Distribution | 3.0 | ||||||
Dental Supplies & Equipment | 3.0 | ||||||
Medical Products | 2.8 | ||||||
Human Resources | 2.8 | ||||||
Consulting Services | 2.6 | ||||||
Diversified Operations | 2.2 | ||||||
Other | 0.0 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Growth | 28.5 | ||||||
Small-Cap Value | 24.0 | ||||||
Small-Cap Growth | 17.9 | ||||||
Mid-Cap Growth | 16.9 | ||||||
Mid-Cap Value | 7.3 | ||||||
Large-Cap Value | 5.4 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Express Scripts, Inc. | 6.7 | ||||||
CIGNA Corp. | 5.4 | ||||||
McKesson Corp. | 5.0 | ||||||
Aetna, Inc. | 4.9 | ||||||
Coventry Health Care, Inc. | 4.9 | ||||||
WellPoint, Inc. | 4.0 | ||||||
UnitedHealth Group, Inc. | 4.0 | ||||||
Humana, Inc. | 3.9 | ||||||
Amedisys, Inc | 3.7 | ||||||
Owens & Minor, Inc. | 3.2 | ||||||
Total | 45.7 |
16
Manager's Analysis (Continued)
PowerShares Dynamic Healthcare Services Portfolio (ticker: PTJ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Healthcare Services IntellidexSM Index | -16.11 | -3.25 | -5.00 | ||||||||||||
Dow Jones US Healthcare Index | -10.59 | -2.12 | -3.27 | ||||||||||||
Dow Jones Healthcare Providers Index | -17.48 | -4.75 | -7.28 |
Fund
NAV Return | -16.73 | -4.02 | -6.15 | ||||||||||||
Share Price Return | -16.81 | -4.02 | -6.17 |
Fund Inception: 12 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.57%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.67% while the Fund's gross total operating expense ratio was 0.80%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Dow Jones US Healthcare Index and the Dow Jones Healthcare Providers Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of approximately 180 and 50 common stocks, respectively.
† Average annualized.
17
Manager's Analysis
PowerShares Dynamic Insurance Portfolio (ticker: PIC)
The PowerShares Dynamic Insurance Portfolio is based on the Dynamic Insurance IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
Over the past year, the Fund has returned -12.56% outperforming the S&P Composite Insurance Index which returned -19.28% during the same period. Stock selection within the large cap value stocks contributed to the Fund's outperformance. Those stocks which contributed positively to the portfolio's performance were SAFECO, AmTrust Financial Services and Prudential Financial. Those stocks which were laggards were Hartford Financial, United America Indemnity, XL Capital and CNA Financial and each contributed negatively to the Fund's performance.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Property/Casualty Insurance | 39.5 | ||||||
Multi-Line Insurance | 26.0 | ||||||
Life/Health Insurance | 15.6 | ||||||
Reinsurance | 10.6 | ||||||
Insurance Brokers | 8.2 | ||||||
Other | 0.1 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Mid-Cap Value | 38.5 | ||||||
Large-Cap Value | 36.0 | ||||||
Small-Cap Value | 20.3 | ||||||
Large-Cap Growth | 5.2 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
AON Corp. | 5.3 | ||||||
Travelers (The) Cos., Inc. | 5.3 | ||||||
ACE Ltd. (Cayman Islands) | 5.2 | ||||||
Aflac, Inc. | 5.2 | ||||||
Allstate (The) Corp. | 5.1 | ||||||
Prudential Financial, Inc. | 5.0 | ||||||
Loews Corp. | 4.9 | ||||||
Safeco Corp. | 3.8 | ||||||
Philadelphia Consolidated Holding Co. | 2.9 | ||||||
Harleysville Group, Inc. | 2.9 | ||||||
Total | 45.6 |
18
Manager's Analysis (Continued)
PowerShares Dynamic Insurance Portfolio (ticker: PIC)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Insurance IntellidexSM Index | -12.18 | 3.56 | 9.22 | ||||||||||||
S&P SuperComposite Insurance Index | -19.28 | -0.79 | -1.99 | ||||||||||||
Russell 3000® Index | -5.16 | 8.14 | 21.80 |
Fund
NAV Return | -12.56 | 3.07 | 7.88 | ||||||||||||
Share Price Return | -12.59 | 3.05 | 7.84 |
Fund Inception: 26 October 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.91%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.82%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Insurance Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 55 and 2,918 common stocks, respectively.
† Average annualized.
19
Manager's Analysis
PowerShares Dynamic Leisure and Entertainment Portfolio (ticker: PEJ)
The PowerShares Dynamic Leisure & Entertainment Portfolio is based on the Dynamic Leisure & Entertainment IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Leisure & Entertainment Portfolio returned -14.58% during the reporting period. The Fund is comprised mainly of consumer discretionary stocks. Hotel and restaurant stocks contributed to the underperformance lead by Ruby Tuesday, Ambassadors Group, Starwood Hotels & Resorts Worldwide, MGM Mirage and Monarch Casino & Resort. Yum! Brands and McDonald's contributed positively to the Fund's performance as each had strong performance for the year.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Retail | 31.7 | ||||||
Media | 21.5 | ||||||
Entertainment | 17.0 | ||||||
Lodging | 12.8 | ||||||
Internet | 9.4 | ||||||
Leisure Time | 7.6 | ||||||
Money Market Fund | 0.9 | ||||||
Other | (0.9 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Mid-Cap Growth | 24.0 | ||||||
Small-Cap Value | 22.9 | ||||||
Large-Cap Value | 18.7 | ||||||
Large-Cap Growth | 14.5 | ||||||
Mid-Cap Value | 11.7 | ||||||
Small-Cap Growth | 8.2 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Yum! Brands, Inc. | 5.8 | ||||||
McDonald's Corp. | 5.4 | ||||||
Carnival Corp. | 5.0 | ||||||
CBS Corp., Class B | 5.0 | ||||||
Marriott International, Inc., Class A | 5.0 | ||||||
Walt Disney (The) Co. | 4.9 | ||||||
International Game Technology | 3.8 | ||||||
Orbitz Worldwide, Inc. | 3.4 | ||||||
Brinker International, Inc. | 3.3 | ||||||
Liberty Media Corp. Capital, Series A | 3.3 | ||||||
Total | 44.9 |
20
Manager's Analysis (Continued)
PowerShares Dynamic Leisure and Entertainment Portfolio (ticker: PEJ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Leisure and Entertainment IntellidexSM Index | -15.33 | 2.38 | 6.95 | ||||||||||||
S&P SuperComposite Hotels, Restaurants & Leisure Index | -3.90 | 7.52 | 23.04 | ||||||||||||
Russell 3000® Index | -5.16 | 7.22 | 22.08 |
Fund
NAV Return | -14.58 | 2.27 | 6.60 | ||||||||||||
Share Price Return | -14.52 | 2.30 | 6.69 |
Fund Inception: 23 June 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.03%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.95%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Hotels, Restaurants & Leisure Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 46 and 2,918 common stocks, respectively.
† Average annualized.
21
Manager's Analysis
PowerShares Dynamic Media Portfolio (ticker: PBS)
The PowerShares Dynamic Media Portfolio is based on the Dynamic Media IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Media Portfolio returned -16.91% during the reporting period outperforming the S&P Composite Media Index which returned -18.50%. Media stocks generally underperformed during the past year. The portfolio is comprised of around 75% media stocks with internet software & services being weighed at 13%. McGraw-Hill, Gannett, Meredith, Journal Communications, Charter Communications and Clear Channel were among the biggest laggards for the portfolio. Google, Sohu.com and IHS contributed positively to the Fund's performance for the reporting period.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Multimedia | 17.0 | ||||||
Web Portals/ISP | 15.2 | ||||||
Television | 10.2 | ||||||
Publishing-Newspapers | 7.9 | ||||||
Cable TV | 7.7 | ||||||
Radio | 5.4 | ||||||
Advertising Agencies | 5.3 | ||||||
Printing-Commercial | 3.5 | ||||||
Broadcast Services/Program | 3.3 | ||||||
Commercial Services | 3.1 | ||||||
Internet Content-Information/News | 3.1 | ||||||
Motion Pictures & Services | 3.0 | ||||||
Computer Services | 2.9 | ||||||
E-Commerce/Services | 2.9 | ||||||
Advertising Services | 2.8 | ||||||
Advertising Sales | 2.2 | ||||||
Direct Marketing | 2.2 | ||||||
Publishing-Books | 2.2 | ||||||
Money Market Fund | 0.7 | ||||||
Other | (0.6 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Growth | 28.5 | ||||||
Mid-Cap Value | 18.7 | ||||||
Small-Cap Value | 18.7 | ||||||
Large-Cap Value | 13.7 | ||||||
Mid-Cap Growth | 10.7 | ||||||
Small-Cap Growth | 9.7 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Google Inc., Class A | 6.1 | ||||||
Omnicom Group, Inc. | 5.3 | ||||||
CBS Corp., Class B | 5.1 | ||||||
Walt Disney (The) Co. | 5.0 | ||||||
Yahoo!, Inc. | 4.9 | ||||||
DIRECTV Group (The), Inc. | 4.9 | ||||||
Time Warner, Inc. | 4.8 | ||||||
Sohu.com, Inc. | 4.2 | ||||||
Valassis Communications, Inc. | 3.5 | ||||||
Liberty Media Corp. - Capital, Series A | 3.3 | ||||||
Total | 47.1 |
22
Manager's Analysis (Continued)
PowerShares Dynamic Media Portfolio (ticker: PBS)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Media IntellidexSM Index | -18.04 | -2.87 | -7.98 | ||||||||||||
S&P SuperComposite Media Index | -18.50 | -0.51 | -1.44 | ||||||||||||
Russell 3000® Index | -5.16 | 7.22 | 22.08 |
Fund
NAV Return | -16.91 | -2.85 | -7.92 | ||||||||||||
Share Price Return | -16.73 | -2.80 | -7.78 |
Fund Inception: 23 June 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.17%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.85%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Media Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 32 and 2,918 common stocks, respectively.
† Average annualized.
23
Manager's Analysis
PowerShares Dynamic Networking Portfolio (ticker: PXQ)
The PowerShares Dynamic Networking Portfolio is based on the Dynamic Networking IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Networking Portfolio returned -14.13% during the reporting period. Communications equipment companies led the underperformance with Arris Group, F5 Networks, Tellabs, NETGEAR, Blue Coat Systems and Emulex leading the laggards and contributing negatively to the Fund's performance. Avaya, within communications equipment industry, and PMC-Sierra and Applied Micro Circuits within semiconductors & semiconductor equipment contributed positively to the Fund's performance.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Telecommunications | 44.8 | ||||||
Semiconductors | 21.4 | ||||||
Internet | 16.8 | ||||||
Software | 10.1 | ||||||
Computers | 7.0 | ||||||
Other | (0.1 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Small-Cap Growth | 40.1 | ||||||
Large-Cap Growth | 26.5 | ||||||
Mid-Cap Growth | 18.2 | ||||||
Small-Cap Value | 10.8 | ||||||
Mid-Cap Value | 4.4 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Broadcom Corp., Class A | 6.5 | ||||||
VMware, Inc., Class A | 5.4 | ||||||
Cisco Systems, Inc. | 5.0 | ||||||
Juniper Networks, Inc. | 4.9 | ||||||
QUALCOMM, Inc. | 4.8 | ||||||
McAfee, Inc. | 4.7 | ||||||
Citrix Systems, Inc. | 4.7 | ||||||
Brocade Communications Systems, Inc. | 4.4 | ||||||
PMC - Sierra, Inc. | 4.2 | ||||||
Ciena Corp. | 3.4 | ||||||
Total | 48.0 |
24
Manager's Analysis (Continued)
PowerShares Dynamic Networking Portfolio (ticker: PXQ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Networking IntellidexSM Index | -13.55 | 2.96 | 8.72 | ||||||||||||
S&P SuperComposite Communications Equipment Index | -6.52 | 5.78 | 17.44 | ||||||||||||
Russell 3000® Index | -5.16 | 7.22 | 22.08 |
Fund
NAV Return | -14.13 | 2.47 | 7.22 | ||||||||||||
Share Price Return | -14.19 | 2.45 | 7.15 |
Fund Inception: 23 June 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.15%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 1.25%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Communications Equipment Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 35 and 2,918 common stocks, respectively.
† Average annualized.
25
Manager's Analysis
PowerShares Dynamic Oil & Gas Services Portfolio (ticker: PXJ)
The PowerShares Dynamic Oil & Gas Services Portfolio is based on the Dynamic Oil Services IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Oil & Gas Services Portfolio posted strong returns of 28.77% during the reporting period. The Fund benefited due to the strong performance of energy prices, mainly oil, as they hit record highs. Most of the performance came from the energy equipment and services companies. National Oilwell Varco, Transocean, Diamond Offshore Drilling, Halliburton and Smith International were just a few of the companies which posted strong, respectable returns during the reporting period. Other solid performers were McDermott International, within the industrial conglomerates industry, and Foster Wheeler, in the construction & engineering industry, both posting solid gains. The Fund was hurt by laggards Parker Drilling and Cal Dive International.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Oil-Field Services | 39.5 | ||||||
Oil Field Machinery & Equipment | 21.1 | ||||||
Oil & Gas Drilling | 20.8 | ||||||
Transport-Marine | 5.7 | ||||||
Engineering/R&D Services | 4.6 | ||||||
Seismic Data Collection | 2.9 | ||||||
Oil Components-Exploration & Production | 2.8 | ||||||
Transport-Services | 2.5 | ||||||
Other | 0.1 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Growth | 37.0 | ||||||
Small-Cap Value | 21.6 | ||||||
Mid-Cap Growth | 19.4 | ||||||
Mid-Cap Value | 8.7 | ||||||
Small-Cap Growth | 7.9 | ||||||
Large-Cap Value | 5.4 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
National Oilwell Varco, Inc. | 6.4 | ||||||
Smith International, Inc. | 5.5 | ||||||
Baker Hughes, Inc. | 5.4 | ||||||
Halliburton Co. | 5.4 | ||||||
Schlumberger Ltd. | 5.2 | ||||||
Noble Corp. | 5.2 | ||||||
Diamond Offshore Drilling, Inc. | 4.7 | ||||||
McDermott International, Inc. | 4.6 | ||||||
Lufkin Industries, Inc. | 3.2 | ||||||
Dril-Quip, Inc. | 3.0 | ||||||
Total | 48.6 |
26
Manager's Analysis (Continued)
PowerShares Dynamic Oil & Gas Services Portfolio (ticker: PXJ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Oil Services IntellidexSM Index | 29.33 | 26.11 | 79.39 | ||||||||||||
S&P SuperComposite Oil & Gas Equipment & Services Index | 33.30 | 31.37 | 98.84 | ||||||||||||
Russell 3000® Index | -5.16 | 8.14 | 21.80 |
Fund
NAV Return | 28.77 | 25.80 | 77.91 | ||||||||||||
Share Price Return | 28.66 | 25.74 | 77.78 |
Fund Inception: 26 October 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses during previous fiscal periods, absent which, performance during those fiscal periods would have been lower. While the Adviser has contractually agreed to waive and/or pay certain Fund expenses through August 30, 2009, the Fund is currently subject to recapture, which may result in an increased expense ratio. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.65%. In the Financial Highlights section of this Shareholder Report, the Fund's net total operating expense ratio was determined to be 0.62% while the Fund's gross total operating expense ratio was 0.60%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Oil & Gas Equipment & Services Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 28 and 2,918 common stocks, respectively.
† Average annualized.
27
Manager's Analysis
PowerShares Dynamic Pharmaceuticals Portfolio (ticker: PJP)
The PowerShares Dynamic Pharmaceuticals Portfolio is based on the Dynamic Pharmaceuticals IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Pharmaceuticals Portfolio returned -11.99% outperforming the S&P Composite Pharmaceuticals Index which returned -14.19% for the reporting period. Pharmaceutical stocks posted negative returns this year after having a solid prior year. The Fund remains well ahead of that Index, posting a since inception cumulative return of 17.22% while the S&P Composite Pharmaceuticals Index has returned only 0.31%. The laggards for the period were Sepracor, King Pharmaceuticals, Salix Pharmaceuticals and Merck. Perrigo, MGI Pharma and Adams Respiratory Therapeutics contributed positively to the Fund's performance.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Medical-Drugs | 49.9 | ||||||
Medical-Biomedical/Gene | 22.3 | ||||||
Medical-Generic Drugs | 14.3 | ||||||
Therapeutics | 5.7 | ||||||
Medical Products | 5.4 | ||||||
Cosmetics & Toiletries | 2.4 | ||||||
Money Market Fund | 0.1 | ||||||
Other | (0.1 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 28.5 | ||||||
Large-Cap Growth | 26.0 | ||||||
Mid-Cap Growth | 19.2 | ||||||
Small-Cap Growth | 16.2 | ||||||
Mid-Cap Value | 7.5 | ||||||
Small-Cap Value | 2.6 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Johnson & Johnson | 5.4 | ||||||
Wyeth | 5.1 | ||||||
Abbott Laboratories | 4.9 | ||||||
Millennium Pharmaceuticals, Inc. | 4.8 | ||||||
Eli Lilly & Co. | 4.8 | ||||||
Amgen, Inc. | 4.6 | ||||||
Pfizer, Inc. | 4.5 | ||||||
Genentech, Inc. | 4.5 | ||||||
Merck & Co., Inc. | 4.3 | ||||||
Perrigo Co. | 3.3 | ||||||
Total | 46.2 |
28
Manager's Analysis (Continued)
PowerShares Dynamic Pharmaceuticals Portfolio (ticker: PJP)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Pharmaceuticals IntellidexSM Index | -11.32 | 6.25 | 18.94 | ||||||||||||
S&P SuperComposite Pharmaceutical Index | -14.19 | 0.11 | 0.31 | ||||||||||||
Russell 3000® Index | -5.16 | 7.22 | 22.08 |
Fund
NAV Return | -11.99 | 5.73 | 17.22 | ||||||||||||
Share Price Return | -12.00 | 5.73 | 17.23 |
Fund Inception: 23 June 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.78%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.69%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Pharmaceutical Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 26 and 2,918 common stocks, respectively.
† Average annualized.
29
Manager's Analysis
PowerShares Dynamic Retail Portfolio (ticker: PMR)
The PowerShares Dynamic Retail Portfolio is based on the Dynamic Retail IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Retail Portfolio returned -19.41% outperforming the S&P Composite Retailing Index which returned -21.29% during the reporting period. Retail companies underperformed during the year due to the weakening economy, lead by rising energy prices and the falling dollar versus other major currencies. Stock selection within the internet & catalog retail industry lead by Amazon.com and Netflix contributed positively to the Fund's performance. Other top performers were the Buckle and Gymboree, each posting solid returns during the year. Sears Holdings, J.C. Penney, Big Lots and Kohl's, within multiline retail, and Collective Brands, New York & Co. and Cato Co. within specialty retail were the laggards contributing negatively to the Fund's performance.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Retail-Apparel/Shoe | 33.4 | ||||||
E-Commerce/Products | 13.9 | ||||||
Food-Retail | 8.3 | ||||||
Retail-Discount | 7.8 | ||||||
Retail-Consumer Electronics | 6.8 | ||||||
Retail-Computer Equipment | 6.1 | ||||||
Rental Auto/Equipment | 5.6 | ||||||
Retail-Automobile | 5.3 | ||||||
Retail-Major Department Store | 4.3 | ||||||
Transport-Services | 3.0 | ||||||
Transport-Equipment & Leasing | 2.8 | ||||||
Distribution/Wholesale | 2.6 | ||||||
Money Market Fund | 0.9 | ||||||
Other | (0.8 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Small-Cap Value | 27.6 | ||||||
Mid-Cap Value | 22.1 | ||||||
Large-Cap Growth | 16.0 | ||||||
Mid-Cap Growth | 14.2 | ||||||
Small-Cap Growth | 10.6 | ||||||
Large-Cap Value | 9.5 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
GameStop Corp., Class A | 6.1 | ||||||
Amazon.com, Inc. | 5.7 | ||||||
eBay, Inc. | 5.6 | ||||||
Safeway, Inc. | 5.2 | ||||||
TJX (The) Cos., Inc. | 4.7 | ||||||
Best Buy Co., Inc. | 4.7 | ||||||
Gap (The), Inc. | 4.3 | ||||||
J.C. Penney Co., Inc. | 4.3 | ||||||
Rent-A-Center, Inc. | 3.2 | ||||||
BJ's Wholesale Club, Inc. | 3.1 | ||||||
Total | 46.9 |
30
Manager's Analysis (Continued)
PowerShares Dynamic Retail Portfolio (ticker: PMR)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Retail IntellidexSM Index | -19.03 | 3.22 | 8.30 | ||||||||||||
S&P SuperComposite Retailing Index | -21.29 | -1.47 | -3.67 | ||||||||||||
Russell 3000® Index | -5.16 | 8.14 | 21.80 |
Fund
NAV Return | -19.41 | 2.72 | 6.97 | ||||||||||||
Share Price Return | -19.45 | 2.70 | 6.93 |
Fund Inception: 26 October 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.29%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 1.46%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Retailing Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 94 and 2,918 common stocks, respectively.
† Average annualized.
31
Manager's Analysis
PowerShares Dynamic Semiconductors Portfolio (ticker: PSI)
The PowerShares Dynamic Semiconductors Portfolio is based on the Dynamic Semiconductors IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Semiconductors Portfolio returned -14.33% during the reporting period. Semiconductor stocks in general fared poorly during the reporting period. Advanced Energy Industries, Cymer, Photronics and AMIS Holdings were the laggards contributing negatively to the Fund's performance. Vishay Intertechnology and InterDigital also had negative returns hurting the Fund's overall performance. PMC-Sierrra and Triquint Semiconductor were a few of the bright spots in the industry as these stocks helped lessen the negative return in the Fund.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Electronic Components & Semiconductors | 53.7 | ||||||
Semiconductor Components-Integrated Circuits | 23.8 | ||||||
Semiconductor Equipment | 20.2 | ||||||
Lasers-Systems/Components | 2.3 | ||||||
Other | 0.0 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Small-Cap Growth | 29.3 | ||||||
Mid-Cap Growth | 23.9 | ||||||
Large-Cap Growth | 22.0 | ||||||
Small-Cap Value | 16.7 | ||||||
Mid-Cap Value | 8.1 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Altera Corp. | 5.6 | ||||||
Analog Devices, Inc. | 5.4 | ||||||
Intel Corp. | 5.1 | ||||||
Xilinx, Inc. | 5.0 | ||||||
Applied Materials, Inc. | 4.4 | ||||||
Texas Instruments, Inc. | 4.4 | ||||||
Nvidia Corp. | 4.4 | ||||||
PMC-Sierra, Inc. | 4.0 | ||||||
MEMC Electronic Materials, Inc. | 3.7 | ||||||
TriQuint Semiconductor, Inc. | 3.5 | ||||||
Total | 45.5 |
32
Manager's Analysis (Continued)
PowerShares Dynamic Semiconductors Portfolio (ticker: PSI)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Semiconductors IntellidexSM Index | -13.59 | 3.85 | 11.41 | ||||||||||||
S&P SuperComposite Semiconductor Index | -8.59 | -1.24 | -3.52 | ||||||||||||
Russell 3000® Index | -5.16 | 7.22 | 22.08 |
Fund
NAV Return | -14.33 | 3.17 | 9.31 | ||||||||||||
Share Price Return | -14.35 | 3.14 | 9.24 |
Fund Inception: 23 June 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.76%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.67%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Semiconductor Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 37 and 2,918 common stocks, respectively.
† Average annualized.
33
Manager's Analysis
PowerShares Dynamic Software Portfolio (ticker: PSJ)
The PowerShares Dynamic Software Portfolio is based on the Dynamic Software IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity Index.
The PowerShares Dynamic Software Portfolio returned -14.03% during the reporting period underperforming the S&P Composite Software & Services Index which returned -1.84%. An overweight position and poor stock selection in software companies along with stock selection in the internet software & services industries contributed negatively to the Fund's performance. Synchronoss Technologies, Macrovision, Cadence Design Systems and Microsoft within software were the laggards while CSG Systems International in IT services added to the Fund's underperformance. BEA Systems, Jack Henry & Associates and Sybase were among those companies which contributed positively to the Fund's performance.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Enterprise Software/Services | 31.1 | ||||||
Applications Software | 10.1 | ||||||
Electronic Design Automation | 8.8 | ||||||
Computer Aided Design | 8.6 | ||||||
Computers-Integrated Systems | 5.8 | ||||||
Computer Services | 5.3 | ||||||
Electronic Forms | 5.3 | ||||||
Internet Security | 4.9 | ||||||
Entertainment Software | 4.7 | ||||||
Decision Support Software | 2.9 | ||||||
Internet Infrastructure Software | 2.8 | ||||||
Internet Application Software | 2.6 | ||||||
Medical Information System | 2.6 | ||||||
Industrial Audio & Video Production | 2.3 | ||||||
Satellite Telecommunications | 2.0 | ||||||
Other | 0.2 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Small-Cap Growth | 30.7 | ||||||
Mid-Cap Growth | 28.8 | ||||||
Large-Cap Growth | 20.1 | ||||||
Mid-Cap Value | 8.2 | ||||||
Small-Cap Value | 7.3 | ||||||
Large-Cap Value | 4.9 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Autodesk, Inc. | 5.8 | ||||||
Oracle Corp. | 5.3 | ||||||
Adobe Systems, Inc. | 5.3 | ||||||
BMC Software, Inc. | 5.1 | ||||||
Microsoft Corp. | 5.0 | ||||||
Symantec Corp. | 4.9 | ||||||
Activision, Inc. | 4.7 | ||||||
CA, Inc. | 4.6 | ||||||
Ansoft Corp. | 3.5 | ||||||
MicroStrategy, Inc. | 3.5 | ||||||
Total | 47.7 |
34
Manager's Analysis (Continued)
PowerShares Dynamic Software Portfolio (ticker: PSJ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Software IntellidexSM Index | -13.58 | 6.16 | 18.64 | ||||||||||||
S&P SuperComposite Software & Services Index | -1.84 | 6.84 | 20.84 | ||||||||||||
Russell 3000® Index | -5.16 | 7.22 | 22.08 |
Fund
NAV Return | -14.03 | 5.67 | 17.02 | ||||||||||||
Share Price Return | -14.02 | 5.66 | 17.01 |
Fund Inception: 23 June 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.80%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.78%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Software & Services Index and the Russell 3000® Index are unmanaged indices used as a measurement of change in stock market conditions based on the average performance of 99 and 2,918 common stocks, respectively.
† Average annualized.
35
Funds' Distribution History
Ex-Dividend | 3/20/08 | 12/21/07 | 9/21/07 | 6/15/07 | 3/16/07 | ||||||||||||||||||||||
Record | 3/25/08 | 12/26/07 | 9/25/07 | 6/19/07 | 3/20/07 | ||||||||||||||||||||||
Payable | 3/31/08 | 12/31/07 | 9/28/07 | 6/29/07 | 3/30/07 | ||||||||||||||||||||||
Fund | Ticker | ||||||||||||||||||||||||||
Dynamic Banking Sector Portfolio | PJB | 0.00305 | 0.16212 | 0.02889 | 0.21285 | — | |||||||||||||||||||||
Dynamic Biotechnology & Genome Portfolio | PBE | — | — | — | — | — | |||||||||||||||||||||
Dynamic Building & Construction Portfolio | PKB | — | — | — | 0.02063 | — | |||||||||||||||||||||
Dynamic Energy Exploration & Production Portfolio | PXE | 0.00761 | 0.00800 | 0.01314 | 0.03364 | — | |||||||||||||||||||||
Dynamic Food & Beverage Portfolio | PBJ | 0.06768 | 0.02922 | 0.23155 | 0.23482 | 0.03265 | |||||||||||||||||||||
Dynamic Hardware & Consumer Electronics Portfolio | PHW | — | 0.33677 | — | — | — | |||||||||||||||||||||
Dynamic Healthcare Services Portfolio | PTJ | — | — | — | — | — | |||||||||||||||||||||
Dynamic Insurance Portfolio | PIC | — | 0.23350 | 0.02802 | 0.03413 | 0.01758 | |||||||||||||||||||||
Dynamic Leisure and Entertainment Portfolio | PEJ | — | 0.55772 | — | 0.01937 | 0.02530 | |||||||||||||||||||||
Dynamic Media Portfolio | PBS | — | 0.24294 | �� | 0.02062 | 0.01298 | — | ||||||||||||||||||||
Dynamic Networking Portfolio | PXQ | — | — | — | — | — | |||||||||||||||||||||
Dynamic Oil & Gas Services Portfolio | PXJ | — | — | — | — | — | |||||||||||||||||||||
Dynamic Pharmaceuticals Portfolio | PJP | — | 0.02176 | 0.02089 | 0.02110 | 0.01580 | |||||||||||||||||||||
Dynamic Retail Portfolio | PMR | — | 0.12567 | — | 0.02352 | 0.02680 | |||||||||||||||||||||
Dynamic Semiconductors Portfolio | PSI | — | — | — | — | — | |||||||||||||||||||||
Dynamic Software Portfolio | PSJ | — | — | — | — | — |
36
12/15/06 | 9/15/06 | 6/16/06 | 3/17/06 | 12/16/05 | 9/16/05 | ||||||||||||||||||||||
12/19/06 | 9/16/06 | 6/20/06 | 3/21/06 | 12/20/05 | 9/20/05 | ||||||||||||||||||||||
12/29/06 | 9/29/06 | 6/30/06 | 3/30/06 | 12/30/05 | 9/30/05 | ||||||||||||||||||||||
Fund | |||||||||||||||||||||||||||
Dynamic Banking Sector Portfolio | 0.22276 | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||
Dynamic Biotechnology & Genome Portfolio | — | — | — | — | — | — | |||||||||||||||||||||
Dynamic Building & Construction Portfolio | — | — | 0.00381 | — | 0.00730 | N/A | |||||||||||||||||||||
Dynamic Energy Exploration & Production Portfolio | 0.05076 | 0.01201 | 0.00182 | — | 0.01681 | N/A | |||||||||||||||||||||
Dynamic Food & Beverage Portfolio | 0.07933 | 0.01726 | 0.03994 | 0.01605 | 0.02825 | 0.04552 | |||||||||||||||||||||
Dynamic Hardware & Consumer Electronics Portfolio | — | — | — | — | — | N/A | |||||||||||||||||||||
Dynamic Healthcare Services Portfolio | — | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||||
Dynamic Insurance Portfolio | 0.07314 | 0.01536 | 0.02181 | 0.01798 | 0.04533 | — | |||||||||||||||||||||
Dynamic Leisure and Entertainment Portfolio | 0.05101 | — | 0.01010 | — | 0.01677 | — | |||||||||||||||||||||
Dynamic Media Portfolio | 0.03264 | — | 0.00739 | — | 0.00257 | 0.01746 | |||||||||||||||||||||
Dynamic Networking Portfolio | — | — | — | — | — | — | |||||||||||||||||||||
Dynamic Oil & Gas Services Portfolio | — | — | — | — | — | N/A | |||||||||||||||||||||
Dynamic Pharmaceuticals Portfolio | 0.05529 | — | 0.02365 | 0.01237 | 0.01581 | 0.01493 | |||||||||||||||||||||
Dynamic Retail Portfolio | 0.00881 | — | 0.01022 | — | 0.01269 | N/A | |||||||||||||||||||||
Dynamic Semiconductors Portfolio | — | — | — | — | — | — | |||||||||||||||||||||
Dynamic Software Portfolio | — | — | — | — | — | — |
37
Frequency Distribution of Discounts & Premiums
Since Inception through April 30, 2008
Closing Price Above NAV (bps) | |||||||||||||||||||||||||||||||||||||||
Ticker | Fund Name | Inception | Days | 0-24 | 25-49 | 50-99 | 100-149 | 150-199 | 200+ | ||||||||||||||||||||||||||||||
PJB | Dynamic Banking Sector Portfolio | 10/12/06 | 389 | 156 | 17 | 0 | 1 | 0 | 0 | ||||||||||||||||||||||||||||||
PBE | Dynamic Biotechnology & Genome Portfolio | 6/23/05 | 718 | 306 | 27 | 3 | 1 | 0 | 0 | ||||||||||||||||||||||||||||||
PKB | Dynamic Building & Construction Portfolio | 10/26/05 | 631 | 210 | 26 | 4 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PXE | Dynamic Energy Exploration & Production Portfolio | 10/26/05 | 631 | 304 | 18 | 5 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PBJ | Dynamic Food & Beverage Portfolio | 6/23/05 | 718 | 337 | 21 | 5 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PHW | Dynamic Hardware & Consumer Electronics Portfolio | 12/6/05 | 603 | 239 | 12 | 2 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PTJ | Dynamic Healthcare Services Sector Portfolio | 10/12/06 | 389 | 135 | 4 | 0 | 1 | 0 | 0 | ||||||||||||||||||||||||||||||
PIC | Dynamic Insurance Portfolio | 10/26/05 | 631 | 270 | 10 | 4 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PEJ | Dynamic Leisure and Entertainment Portfolio | 6/23/05 | 718 | 282 | 21 | 6 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PBS | Dynamic Media Portfolio | 6/23/05 | 718 | 258 | 20 | 2 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PXQ | Dynamic Networking Portfolio | 6/23/05 | 718 | 293 | 18 | 8 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PXJ | Dynamic Oil & Gas Services Portfolio | 10/26/05 | 631 | 261 | 38 | 10 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PJP | Dynamic Pharmaceuticals Portfolio | 6/23/05 | 718 | 376 | 10 | 5 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PMR | Dynamic Retail Portfolio | 10/26/05 | 631 | 250 | 17 | 3 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PSI | Dynamic Semiconductors Portfolio | 6/23/05 | 718 | 340 | 19 | 3 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
PSJ | Dynamic Software Portfolio | 6/23/05 | 718 | 364 | 10 | 7 | 0 | 0 | 0 |
38
Closing Price Below NAV (bps) | |||||||||||||||||||||||||||
Ticker | -0-24 | -25-49 | -50-99 | -100-149 | -150-199 | -200+ | |||||||||||||||||||||
PJB | 203 | 11 | 1 | 0 | 0 | 0 | |||||||||||||||||||||
PBE | 347 | 32 | 2 | 0 | 0 | 0 | |||||||||||||||||||||
PKB | 379 | 12 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
PXE | 293 | 8 | 3 | 0 | 0 | 0 | |||||||||||||||||||||
PBJ | 343 | 12 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
PHW | 343 | 6 | 1 | 0 | 0 | 0 | |||||||||||||||||||||
PTJ | 247 | 2 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
PIC | 338 | 9 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
PEJ | 400 | 8 | 1 | 0 | 0 | 0 | |||||||||||||||||||||
PBS | 427 | 11 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
PXQ | 387 | 11 | 1 | 0 | 0 | 0 | |||||||||||||||||||||
PXJ | 314 | 7 | 1 | 0 | 0 | 0 | |||||||||||||||||||||
PJP | 323 | 4 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
PMR | 338 | 22 | 1 | 0 | 0 | 0 | |||||||||||||||||||||
PSI | 350 | 6 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
PSJ | 333 | 3 | 1 | 0 | 0 | 0 |
39
Fees and Expenses
As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, you incur Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the 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 through the six-month period ended April 30, 2008.
Actual Expenses
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, 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 first line under the heading "Expenses Paid During the Six-Month Period" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds' actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Funds' 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 Funds 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 tables are meant to highlight your ongoing costs only, and do not reflect any transactional costs such as sales charges (loads). Therefore the second line in the table 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 transactional costs were included, your costs would have been higher.
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Dynamic Banking Portfolio Actual | $ | 1,000.00 | $ | 927.36 | 0.65 | % | $ | 3.11 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | 0.65 | % | $ | 3.27 | |||||||||||
PowerShares Dynamic Biotechnology & Genome Portfolio Actual | $ | 1,000.00 | $ | 903.41 | 0.63 | % | $ | 2.98 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Building & Construction Portfolio Actual | $ | 1,000.00 | $ | 857.36 | 0.63 | % | $ | 2.91 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Energy Exploration & Production Portfolio Actual | $ | 1,000.00 | $ | 1,070.43 | 0.63 | % | $ | 3.24 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 |
40
Fees and Expenses (Continued)
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Dynamic Food & Beverage Portfolio Actual | $ | 1,000.00 | $ | 953.99 | 0.63 | % | $ | 3.06 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Hardware & Consumer Electronics Portfolio Actual | $ | 1,000.00 | $ | 719.67 | 0.63 | % | $ | 2.69 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Healthcare Services Portfolio Actual | $ | 1,000.00 | $ | 804.34 | 0.65 | % | $ | 2.92 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | 0.65 | % | $ | 3.27 | |||||||||||
PowerShares Dynamic Insurance Portfolio Actual | $ | 1,000.00 | $ | 909.63 | 0.63 | % | $ | 2.99 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Leisure and Entertainment Portfolio Actual | $ | 1,000.00 | $ | 867.12 | 0.63 | % | $ | 2.92 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Media Portfolio Actual | $ | 1,000.00 | $ | 829.25 | 0.63 | % | $ | 2.87 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Networking Portfolio Actual | $ | 1,000.00 | $ | 769.68 | 0.63 | % | $ | 2.77 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Oil & Gas Services Portfolio Actual | $ | 1,000.00 | $ | 1,066.78 | 0.60 | % | $ | 3.08 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.88 | 0.60 | % | $ | 3.02 | |||||||||||
PowerShares Dynamic Pharmaceuticals Portfolio Actual | $ | 1,000.00 | $ | 902.52 | 0.63 | % | $ | 2.98 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Retail Portfolio Actual | $ | 1,000.00 | $ | 916.64 | 0.63 | % | $ | 3.00 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Semiconductors Portfolio Actual | $ | 1,000.00 | $ | 891.32 | 0.63 | % | $ | 2.96 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Software Portfolio Actual | $ | 1,000.00 | $ | 813.46 | 0.63 | % | $ | 2.84 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 |
(1) Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six months ended April 30, 2008. Expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 182 and then dividing the result by 366. Expense ratios for the most recent half-year may differ from expense ratios based on the one year data in the financial highlights.
41
Schedule of Investments
PowerShares Dynamic Banking Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.2% | |||||||||||
Commercial Banks - Central US—19.9% | |||||||||||
64,205 | BancFirst Corp. | $ | 2,807,685 | ||||||||
64,951 | Commerce Bancshares, Inc. | 2,825,369 | |||||||||
52,922 | Cullen/Frost Bankers, Inc. | 2,954,106 | |||||||||
71,431 | First Financial Bankshares, Inc. | 3,213,681 | |||||||||
144,109 | FirstMerit Corp. | 2,957,117 | |||||||||
124,773 | International Bancshares Corp. | 3,118,076 | |||||||||
70,668 | UMB Financial Corp. | 3,507,959 | |||||||||
21,383,993 | |||||||||||
Commercial Banks - Eastern US—13.4% | |||||||||||
122,406 | Community Bank System, Inc. | 3,120,129 | |||||||||
255,670 | First Commonwealth Financial Corp. | 3,183,091 | |||||||||
168,964 | National Penn Bancshares, Inc. | 2,820,009 | |||||||||
99,417 | Sandy Spring Bancorp, Inc. | 2,535,134 | |||||||||
312,715 | TrustCo Bank Corp. NY | 2,730,002 | |||||||||
14,388,365 | |||||||||||
Commercial Banks - Southern US—13.3% | |||||||||||
72,634 | City Holding Co. | 3,020,123 | |||||||||
19,020 | First Citizens BancShares, Inc., Class A | 2,677,445 | |||||||||
73,027 | Hancock Holding Co. | 3,013,824 | |||||||||
136,887 | Trustmark Corp. | 2,981,399 | |||||||||
112,662 | Whitney Holding Corp. | 2,637,417 | |||||||||
14,330,208 | |||||||||||
Commercial Banks - Western US—13.9% | |||||||||||
56,331 | Bank of Hawaii Corp. | 3,088,629 | |||||||||
59,713 | SVB Financial Group* | 2,905,635 | |||||||||
106,485 | UnionBanCal Corp. | 5,591,526 | |||||||||
57,149 | Westamerica Bancorp. | 3,339,788 | |||||||||
14,925,578 | |||||||||||
Fiduciary Banks—5.0% | |||||||||||
73,333 | Northern Trust Corp. | 5,434,709 | |||||||||
Finance - Investment Banker/Broker—5.4% | |||||||||||
122,001 | JPMorgan Chase & Co. | 5,813,348 | |||||||||
S&L/Thrifts - Eastern US—10.9% | |||||||||||
236,866 | First Niagara Financial Group, Inc. | 3,417,976 | |||||||||
303,686 | New York Community Bancorp, Inc. | 5,669,818 | |||||||||
102,417 | Northwest Bancorp, Inc. | 2,642,359 | |||||||||
11,730,153 | |||||||||||
Super-Regional Banks - US—18.4% | |||||||||||
136,838 | Comerica, Inc. | 4,752,384 | |||||||||
85,316 | SunTrust Banks, Inc. | 4,756,367 | |||||||||
154,873 | U.S. Bancorp | 5,248,645 | |||||||||
169,662 | Wells Fargo & Co. | 5,047,444 | |||||||||
19,804,840 | |||||||||||
Total Common Stocks (Cost $105,808,746) | 107,811,194 |
Number of Shares | Value | ||||||||||
Money Market Fund—0.1% | |||||||||||
131,204 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $131,204) | $ | 131,204 | ||||||||
Total Investments (Cost $105,939,950)—100.3% | 107,942,398 | ||||||||||
Liabilities in excess of other assets—(0.3%) | (294,218 | ) | |||||||||
Net Assets—100.0% | $ | 107,648,180 |
* Non-income producing security.
See Notes to Financial Statements.
42
Schedule of Investments
PowerShares Dynamic Biotechnology & Genome Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.2% | |||||||||||
Biotechnology—42.3% | |||||||||||
84,946 | Alexion Pharmaceuticals, Inc.* | $ | 5,978,499 | ||||||||
124,606 | Genentech, Inc.* | 8,498,129 | |||||||||
133,094 | Genzyme Corp.* | 9,363,163 | |||||||||
519,539 | Incyte Corp.* | 5,636,998 | |||||||||
111,717 | Invitrogen Corp.* | 10,453,360 | |||||||||
674,700 | Millennium Pharmaceuticals, Inc.* | 16,779,788 | |||||||||
73,656 | Millipore Corp.* | 5,163,286 | |||||||||
139,074 | Myriad Genetics, Inc.* | 5,777,134 | |||||||||
260,424 | Regeneron Pharmaceuticals, Inc.* | 5,109,519 | |||||||||
440,054 | Sangamo Biosciences, Inc.* | 5,610,689 | |||||||||
572,701 | Seattle Genetics, Inc.* | 5,818,642 | |||||||||
84,189,207 | |||||||||||
Chemicals—4.9% | |||||||||||
171,558 | Sigma-Aldrich Corp. | 9,782,237 | |||||||||
Electronics—14.6% | |||||||||||
280,008 | Applera Corp. - Applied Biosystems Group | 8,935,055 | |||||||||
69,746 | Dionex Corp.* | 5,455,532 | |||||||||
95,082 | Varian, Inc.* | 4,842,526 | |||||||||
158,345 | Waters Corp.* | 9,731,884 | |||||||||
28,964,997 | |||||||||||
Healthcare - Products—9.5% | |||||||||||
376,635 | Bruker Corp.* | 4,564,816 | |||||||||
186,004 | Cepheid, Inc.* | 3,640,098 | |||||||||
116,562 | SurModics, Inc.* | 5,183,512 | |||||||||
75,281 | Techne Corp.* | 5,459,379 | |||||||||
18,847,805 | |||||||||||
Pharmaceuticals—28.9% | |||||||||||
397,883 | Alkermes, Inc.* | 4,945,686 | |||||||||
181,289 | Alnylam Pharmaceuticals, Inc.* | 4,546,728 | |||||||||
282,893 | Cubist Pharmaceuticals, Inc.* | 5,476,808 | |||||||||
881,611 | CV Therapeutics, Inc.* | 8,066,741 | |||||||||
199,474 | Gilead Sciences, Inc.* | 10,324,773 | |||||||||
143,212 | OSI Pharmaceuticals, Inc.* | 4,962,296 | |||||||||
259,769 | Rigel Pharmaceuticals, Inc.* | 5,844,803 | |||||||||
312,981 | Theravance, Inc.* | 3,909,133 | |||||||||
562,074 | Viropharma, Inc.* | 5,148,598 | |||||||||
100,615 | XenoPort, Inc.* | 4,304,310 | |||||||||
57,529,876 | |||||||||||
Total Investments (Cost $198,435,826)—100.2% | 199,314,122 | ||||||||||
Liabilities in excess of other assets—(0.2%) | (314,519 | ) | |||||||||
Net Assets—100.0% | $ | 198,999,603 |
* Non-income producing security.
See Notes to Financial Statements.
43
Schedule of Investments
PowerShares Dynamic Building & Construction Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.6% | |||||||||||
Agriculture—3.1% | |||||||||||
11,543 | Tejon Ranch Co.* | $ | 487,807 | ||||||||
Building Materials—18.3% | |||||||||||
13,028 | Armstrong World Industries, Inc.* | 463,667 | |||||||||
34,339 | Comfort Systems USA, Inc. | 467,010 | |||||||||
10,856 | Lennox International, Inc. | 359,768 | |||||||||
13,468 | NCI Building Systems, Inc.* | 325,118 | |||||||||
17,055 | Simpson Manufacturing Co., Inc. | 450,081 | |||||||||
16,629 | Trane, Inc. | 773,415 | |||||||||
2,839,059 | |||||||||||
Electric—3.3% | |||||||||||
31,603 | Pike Electric Corp.* | 506,912 | |||||||||
Engineering & Construction—24.5% | |||||||||||
15,765 | Aecom Technology Corp.* | 432,907 | |||||||||
35,719 | Dycom Industries, Inc.* | 513,639 | |||||||||
16,963 | EMCOR Group, Inc.* | 425,093 | |||||||||
5,380 | Fluor Corp. | 822,441 | |||||||||
9,331 | Jacobs Engineering Group, Inc.* | 805,545 | |||||||||
10,903 | Perini Corp.* | 394,471 | |||||||||
10,145 | URS Corp.* | 409,249 | |||||||||
3,803,345 | |||||||||||
Environmental Control—3.0% | |||||||||||
21,655 | Tetra Tech, Inc.* | 457,570 | |||||||||
Forest Products & Paper—5.0% | |||||||||||
12,241 | Weyerhaeuser Co. | 781,955 | |||||||||
Home Builders—3.0% | |||||||||||
756 | NVR, Inc.* | 463,806 | |||||||||
Machinery - Construction & Mining—13.0% | |||||||||||
10,793 | Astec Industries, Inc.* | 395,563 | |||||||||
10,357 | Caterpillar, Inc. | 848,031 | |||||||||
11,107 | Terex Corp.* | 773,936 | |||||||||
2,017,530 | |||||||||||
Machinery - Diversified—4.5% | |||||||||||
18,389 | Manitowoc (The) Co., Inc. | 695,472 | |||||||||
Metal Fabricate/Hardware—5.2% | |||||||||||
9,647 | L.B. Foster Co., Class A* | 309,669 | |||||||||
5,114 | Valmont Industries, Inc. | 503,524 | |||||||||
813,193 | |||||||||||
Miscellaneous Manufacturing—4.0% | |||||||||||
3,702 | Ameron International Corp. | 365,758 | |||||||||
17,133 | LSB Industries, Inc.* | 262,306 | |||||||||
628,064 | |||||||||||
Office Furnishings—2.0% | |||||||||||
24,381 | Interface, Inc., Class A | 313,052 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Retail—2.5% | |||||||||||
10,914 | Tractor Supply Co.* | $ | 388,102 | ||||||||
Storage/Warehousing—3.0% | |||||||||||
21,958 | Mobile Mini, Inc.* | 466,608 | |||||||||
Textiles—5.2% | |||||||||||
10,491 | Mohawk Industries, Inc.* | 799,309 | |||||||||
Total Common Stocks (Cost $16,057,494) | 15,461,784 | ||||||||||
Money Market Fund—0.3% | |||||||||||
39,857 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $39,857) | 39,857 | |||||||||
Total Investments (Cost $16,097,351)—99.9% | 15,501,641 | ||||||||||
Other assets less liabilities—0.1% | 21,548 | ||||||||||
Net Assets—100.0% | $ | 15,523,189 |
* Non-income producing security.
See Notes to Financial Statements.
44
Schedule of Investments
PowerShares Dynamic Energy Exploration & Production Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Gas - Distribution—2.9% | |||||||||||
58,325 | Energen Corp. | $ | 3,980,098 | ||||||||
Oil Companies - Exploration & Production—66.8% | |||||||||||
100,654 | Anadarko Petroleum Corp. | 6,699,530 | |||||||||
55,931 | Apache Corp. | 7,532,787 | |||||||||
85,121 | Berry Petroleum Co., Class A | 4,215,192 | |||||||||
162,989 | Bois d'Arc Energy, Inc.* | 3,895,437 | |||||||||
70,342 | Cabot Oil & Gas Corp. | 4,007,384 | |||||||||
66,400 | Cimarex Energy Co. | 4,136,720 | |||||||||
96,400 | Comstock Resources, Inc.* | 4,385,236 | |||||||||
109,733 | Denbury Resources, Inc.* | 3,353,440 | |||||||||
62,456 | Devon Energy Corp. | 7,082,510 | |||||||||
70,938 | Forest Oil Corp.* | 4,180,376 | |||||||||
126,198 | Mariner Energy, Inc.* | 3,478,017 | |||||||||
45,214 | Noble Energy, Inc. | 3,933,618 | |||||||||
82,923 | Occidental Petroleum Corp. | 6,900,023 | |||||||||
222,045 | Petroquest Energy, Inc.* | 4,614,095 | |||||||||
94,888 | St. Mary Land & Exploration Co. | 4,148,503 | |||||||||
68,937 | Stone Energy Corp.* | 4,201,021 | |||||||||
73,315 | Swift Energy Co.* | 3,822,644 | |||||||||
44,598 | Ultra Petroleum Corp.* | 3,704,756 | |||||||||
98,633 | W&T Offshore, Inc. | 4,034,090 | |||||||||
57,161 | Whiting Petroleum Corp.* | 4,373,960 | |||||||||
92,699,339 | |||||||||||
Oil Companies - Integrated—21.9% | |||||||||||
74,034 | Chevron Corp. | 7,118,369 | |||||||||
77,569 | ConocoPhillips | 6,682,569 | |||||||||
221,761 | Delek US Holdings, Inc. | 2,446,024 | |||||||||
73,732 | Exxon Mobil Corp. | 6,862,237 | |||||||||
68,850 | Hess Corp. | 7,311,871 | |||||||||
30,421,070 | |||||||||||
Oil Refining & Marketing—5.6% | |||||||||||
97,996 | Frontier Oil Corp. | 2,435,201 | |||||||||
65,545 | Holly Corp. | 2,718,807 | |||||||||
57,289 | Sunoco, Inc. | 2,658,782 | |||||||||
7,812,790 | |||||||||||
Pipelines—2.8% | |||||||||||
63,337 | Questar Corp. | 3,928,794 | |||||||||
Total Investments (Cost $115,961,538)—100.0% | 138,842,091 | ||||||||||
Liabilities in excess of other assets—(0.0%) | (39,722 | ) | |||||||||
Net Assets—100.0% | $ | 138,802,369 |
* Non-income producing security.
See Notes to Financial Statements.
45
Schedule of Investments
PowerShares Dynamic Food & Beverage Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.2% | |||||||||||
Agricultural Chemicals—4.7% | |||||||||||
35,605 | Monsanto Co. | $ | 4,059,682 | ||||||||
Beverages - Non-alcoholic—14.5% | |||||||||||
41,078 | Cocoa-Cola Bottling Co. Consolidated | 2,350,483 | |||||||||
91,955 | Coca-Cola Enterprises, Inc. | 2,068,988 | |||||||||
54,129 | Hansen Natural Corp.* | 1,915,625 | |||||||||
66,052 | Pepsi Bottling Group (The), Inc. | 2,226,613 | |||||||||
59,210 | PepsiCo, Inc. | 4,057,661 | |||||||||
12,619,370 | |||||||||||
Beverages - Wine/Spirits—2.8% | |||||||||||
35,224 | Brown-Forman Corp., Class B | 2,395,936 | |||||||||
Brewery—7.6% | |||||||||||
87,460 | Anheuser-Busch Cos., Inc. | 4,303,032 | |||||||||
41,629 | Molson Coors Brewing Co., Class B | 2,282,934 | |||||||||
6,585,966 | |||||||||||
Food - Confectionery—8.5% | |||||||||||
43,888 | J.M. Smucker (The) Co. | 2,189,133 | |||||||||
68,804 | Wm. Wrigley Jr. Co. | 5,240,113 | |||||||||
7,429,246 | |||||||||||
Food - Miscellaneous/Diversified—34.8% | |||||||||||
69,572 | Campbell Soup Co. | 2,421,106 | |||||||||
109,744 | Chiquita Brands International, Inc.* | 2,496,676 | |||||||||
101,652 | ConAgra Foods, Inc. | 2,394,921 | |||||||||
73,556 | General Mills, Inc. | 4,442,781 | |||||||||
50,931 | H.J. Heinz Co. | 2,395,285 | |||||||||
54,981 | Hormel Foods Corp. | 2,166,801 | |||||||||
81,200 | Kellogg Co. | 4,155,004 | |||||||||
60,505 | Lancaster Colony Corp. | 2,310,686 | |||||||||
65,211 | McCormick & Co., Inc. | 2,464,324 | |||||||||
40,517 | Ralcorp Holdings, Inc.* | 2,473,158 | |||||||||
177,867 | Sara Lee Corp. | 2,580,850 | |||||||||
30,301,592 | |||||||||||
Food - Retail—5.9% | |||||||||||
69,654 | Ruddick Corp. | 2,695,610 | |||||||||
78,166 | Safeway, Inc. | 2,470,046 | |||||||||
5,165,656 | |||||||||||
Food - Wholesale/Distributions—5.2% | |||||||||||
67,645 | Fresh Del Monte Produce, Inc.* | 2,143,670 | |||||||||
64,058 | Nash Finch Co. | 2,343,242 | |||||||||
4,486,912 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Retail - Restaurants—16.2% | |||||||||||
87,549 | Burger King Holdings, Inc. | $ | 2,442,617 | ||||||||
85,514 | Jack in the Box, Inc.* | 2,287,500 | |||||||||
76,111 | McDonald's Corp. | 4,534,693 | |||||||||
119,549 | Yum! Brands, Inc. | 4,863,254 | |||||||||
14,128,064 | |||||||||||
Total Investments (Cost $85,334,153)—100.2% | 87,172,424 | ||||||||||
Liabilities in excess of other assets—(0.2%) | (159,491 | ) | |||||||||
Net Assets—100.0% | $ | 87,012,933 |
* Non-income producing security.
See Notes to Financial Statements.
46
Schedule of Investments
PowerShares Dynamic Hardware & Consumer Electronics Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stock—99.8% | |||||||||||
Computers—40.0% | |||||||||||
2,387 | Apple, Inc.* | $ | 415,218 | ||||||||
21,169 | Brocade Communications Systems, Inc.* | 151,570 | |||||||||
15,036 | Dell, Inc.* | 280,121 | |||||||||
19,205 | EMC Corp.* | 295,757 | |||||||||
6,248 | Hewlett-Packard Co. | 289,595 | |||||||||
4,928 | Lexmark International, Inc., Class A* | 154,690 | |||||||||
7,347 | NCR Corp.* | 180,957 | |||||||||
7,530 | NetApp, Inc.* | 182,226 | |||||||||
18,197 | Sun Microsystems, Inc.* | 284,965 | |||||||||
5,273 | Western Digital Corp.* | 152,864 | |||||||||
2,387,963 | |||||||||||
Electronics—22.5% | |||||||||||
9,751 | Agilent Technologies, Inc.* | 294,577 | |||||||||
9,691 | Benchmark Electronics, Inc.* | 172,306 | |||||||||
6,727 | Checkpoint Systems, Inc.* | 174,431 | |||||||||
5,084 | Garmin Ltd. | 207,936 | |||||||||
6,295 | National Instruments Corp. | 185,199 | |||||||||
6,573 | Plexus Corp.* | 158,344 | |||||||||
98,660 | Sanmina-SCI Corp.* | 152,923 | |||||||||
1,345,716 | |||||||||||
Home Furnishings—5.3% | |||||||||||
3,951 | Harman International Industries, Inc. | 161,477 | |||||||||
18,755 | Tivo, Inc.* | 154,354 | |||||||||
315,831 | |||||||||||
Machinery - Diversified—5.6% | |||||||||||
7,387 | Intermec, Inc.* | 156,013 | |||||||||
4,885 | Zebra Technologies Corp., Class A* | 179,524 | |||||||||
335,537 | |||||||||||
Miscellaneous Manufacturing—2.9% | |||||||||||
9,586 | Eastman Kodak Co. | 171,494 | |||||||||
Office/Business Equipment—4.8% | |||||||||||
20,302 | Xerox Corp. | 283,619 | |||||||||
Semiconductors—5.1% | |||||||||||
10,939 | Emulex Corp.* | 143,192 | |||||||||
10,270 | QLogic Corp.* | 163,909 | |||||||||
307,101 | |||||||||||
Software—2.3% | |||||||||||
6,681 | Avid Technology, Inc.* | 139,432 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Telecommunications—11.3% | |||||||||||
21,677 | Ixia* | $ | 153,690 | ||||||||
15,387 | Novatel Wireless, Inc.* | 137,252 | |||||||||
8,632 | Plantronics, Inc. | 215,023 | |||||||||
7,467 | Polycom, Inc.* | 167,261 | |||||||||
673,226 | |||||||||||
Total Investments (Cost $7,412,367)—99.8% | 5,959,919 | ||||||||||
Other assets less liabilities—0.2% | 11,056 | ||||||||||
Net Assets—100.0% | $ | 5,970,975 |
* Non-income producing security.
See Notes to Financial Statements.
47
Schedule of Investments
PowerShares Dynamic Healthcare Services Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Consulting Services—2.6% | |||||||||||
15,474 | Advisory Board (The) Co.* | $ | 721,398 | ||||||||
Dental Supplies & Equipment—3.0% | |||||||||||
24,430 | Patterson Cos., Inc.* | 835,506 | |||||||||
Distribution/Wholesale—3.2% | |||||||||||
20,026 | Owens & Minor, Inc. | 907,578 | |||||||||
Diversified Operations—2.2% | |||||||||||
18,040 | Chemed Corp. | 615,164 | |||||||||
Hazardous Waste Disposal—3.0% | |||||||||||
15,962 | Stericycle, Inc.* | 852,051 | |||||||||
Health Care Cost Containment—7.9% | |||||||||||
49,016 | Healthspring, Inc.* | 825,429 | |||||||||
26,837 | McKesson Corp. | 1,398,745 | |||||||||
2,224,174 | |||||||||||
Human Resources—2.8% | |||||||||||
53,143 | AMN Healthcare Services, Inc.* | 775,356 | |||||||||
Life/Health Insurance—5.4% | |||||||||||
35,370 | CIGNA Corp. | 1,510,653 | |||||||||
Medical Products—2.8% | |||||||||||
14,382 | Henry Schein, Inc.* | 796,331 | |||||||||
Medical - HMO—39.8% | |||||||||||
31,800 | Aetna, Inc. | 1,386,481 | |||||||||
23,907 | AMERIGROUP Corp.* | 621,343 | |||||||||
47,992 | Centene Corp.* | 881,613 | |||||||||
30,408 | Coventry Health Care, Inc.* | 1,360,151 | |||||||||
19,587 | Health Net, Inc.* | 573,703 | |||||||||
23,091 | Humana, Inc.* | 1,103,519 | |||||||||
19,862 | Magellan Health Services, Inc.* | 766,475 | |||||||||
27,186 | Molina Healthcare, Inc.* | 675,028 | |||||||||
42,581 | Triple-S Management Corp., Class B* | 776,677 | |||||||||
33,933 | UnitedHealth Group, Inc. | 1,107,234 | |||||||||
18,031 | WellCare Health Plans, Inc.* | 789,397 | |||||||||
22,515 | WellPoint, Inc.* | 1,120,121 | |||||||||
11,161,742 | |||||||||||
Medical - Outpatient/Home Medical Care—14.4% | |||||||||||
20,930 | Air Methods Corp.* | 839,293 | |||||||||
20,099 | Amedisys, Inc.* | 1,041,128 | |||||||||
39,896 | Gentiva Health Services, Inc.* | 867,339 | |||||||||
26,467 | Lincare Holdings, Inc.* | 644,207 | |||||||||
39,936 | Res-Care, Inc.* | 650,557 | |||||||||
4,042,524 | |||||||||||
Medical - Wholesale Drug Distribution—3.0% | |||||||||||
20,626 | AmerisourceBergen Corp. | 836,384 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Pharmacy Services—6.7% | |||||||||||
26,685 | Express Scripts, Inc.* | $ | 1,868,484 | ||||||||
Physician Practice Management—3.2% | |||||||||||
13,022 | Pediatrix Medical Group, Inc.* | 885,756 | |||||||||
Total Investments (Cost $35,950,635)—100.0% | 28,033,101 | ||||||||||
Liabilities in excess of other assets—(0.0%) | (7,582 | ) | |||||||||
Net Assets—100.0% | $ | 28,025,519 |
* Non-income producing security.
See Notes to Financial Statements.
48
Schedule of Investments
PowerShares Dynamic Insurance Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks —99.9% | |||||||||||
Insurance Brokers—8.2% | |||||||||||
39,746 | AON Corp. | $ | 1,804,071 | ||||||||
18,278 | Erie Indemnity Co., Class A | 976,411 | |||||||||
2,780,482 | |||||||||||
Life/Health Insurance—15.6% | |||||||||||
26,499 | Aflac, Inc. | 1,766,689 | |||||||||
22,664 | Prudential Financial, Inc. | 1,715,891 | |||||||||
16,488 | Reinsurance Group of America, Inc. | 857,046 | |||||||||
14,970 | Torchmark Corp. | 969,158 | |||||||||
5,308,784 | |||||||||||
Multi-line Insurance—26.0% | |||||||||||
29,406 | ACE Ltd. | 1,772,887 | |||||||||
34,649 | Allstate (The) Corp. | 1,744,924 | |||||||||
14,422 | Assurant, Inc. | 937,430 | |||||||||
20,647 | Hanover Insurance Group (The), Inc. | 926,637 | |||||||||
37,492 | HCC Insurance Holdings, Inc. | 925,303 | |||||||||
39,527 | Loews Corp. | 1,664,482 | |||||||||
26,262 | United Fire & Casualty Co. | 865,333 | |||||||||
8,836,996 | |||||||||||
Property/Casualty Insurance—39.5% | |||||||||||
13,173 | Arch Capital Group Ltd.* | 930,672 | |||||||||
32,491 | Chubb (The) Corp. | 1,721,049 | |||||||||
26,863 | Harleysville Group, Inc. | 979,156 | |||||||||
1,941 | Markel Corp.* | 843,170 | |||||||||
16,482 | Navigators Group (The), Inc.* | 807,618 | |||||||||
26,594 | Philadelphia Consolidated Holding Co.* | 980,787 | |||||||||
16,966 | ProAssurance Corp.* | 898,010 | |||||||||
17,271 | RLI Corp. | 829,008 | |||||||||
19,500 | Safeco Corp. | 1,301,430 | |||||||||
37,966 | Selective Insurance Group | 809,435 | |||||||||
35,635 | Travelers (The) Cos., Inc. | 1,796,005 | |||||||||
48,085 | United America Indemnity Ltd., Class A* | 743,394 | |||||||||
31,333 | W.R. Berkley Corp. | 804,945 | |||||||||
13,444,679 | |||||||||||
Reinsurance—10.6% | |||||||||||
33,262 | IPC Holdings Ltd. | 968,257 | |||||||||
24,933 | Odyssey Re Holdings Corp. | 892,103 | |||||||||
11,732 | PartnerRe Ltd. | 867,933 | |||||||||
13,384 | Transatlantic Holdings, Inc. | 867,952 | |||||||||
3,596,245 | |||||||||||
Total Investments (Cost $35,069,905)—99.9% | 33,967,186 | ||||||||||
Other assets less liabilities—0.1% | 44,561 | ||||||||||
Net Assets—100.0% | $ | 34,011,747 |
* Non-income producing security.
See Notes to Financial Statements.
49
Schedule of Investments
PowerShares Dynamic Leisure and Entertainment Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Entertainment—17.0% | |||||||||||
10,725 | Bally Technologies, Inc.* | $ | 361,325 | ||||||||
16,017 | DreamWorks Animation SKG, Inc., Class A* | 447,835 | |||||||||
16,510 | International Game Technology | 573,558 | |||||||||
10,203 | International Speedway Corp., Class A | 432,811 | |||||||||
20,604 | Regal Entertainment Group, Class A | 390,652 | |||||||||
13,922 | Speedway Motorsports, Inc. | 362,529 | |||||||||
2,568,710 | |||||||||||
Internet—9.4% | |||||||||||
17,731 | Expedia, Inc.* | 447,885 | |||||||||
64,428 | Orbitz Worldwide, Inc.* | 512,203 | |||||||||
3,567 | priceline.com, Inc.* | 455,292 | |||||||||
1,415,380 | |||||||||||
Leisure Time—7.6% | |||||||||||
18,941 | Carnival Corp. | 760,860 | |||||||||
10,706 | WMS Industries, Inc.* | 387,450 | |||||||||
1,148,310 | |||||||||||
Lodging—12.8% | |||||||||||
19,277 | Boyd Gaming Corp. | 361,444 | |||||||||
12,528 | Choice Hotels International, Inc. | 432,091 | |||||||||
21,857 | Marriott International, Inc., Class A | 749,694 | |||||||||
18,337 | Wyndham Worldwide Corp. | 393,879 | |||||||||
1,937,108 | |||||||||||
Media—21.5% | |||||||||||
32,659 | CBS Corp., Class B | 753,443 | |||||||||
18,013 | Discovery Holding Co., Class A* | 417,181 | |||||||||
9,731 | E.W. Scripps Co., Class A | 437,019 | |||||||||
32,097 | Liberty Media Corp. Capital, Series A* | 493,331 | |||||||||
22,997 | Walt Disney (The) Co. | 745,793 | |||||||||
22,970 | World Wrestling Entertainment, Inc., Class A | 405,421 | |||||||||
3,252,188 | |||||||||||
Retail—31.7% | |||||||||||
14,042 | Bob Evans Farms, Inc. | 394,159 | |||||||||
22,046 | Brinker International, Inc. | 500,224 | |||||||||
15,845 | Burger King Holdings, Inc. | 442,075 | |||||||||
11,162 | CBRL Group, Inc. | 412,324 | |||||||||
15,474 | Jack in the Box, Inc.* | 413,930 | |||||||||
13,775 | McDonald's Corp. | 820,715 | |||||||||
14,249 | PF Chang's China Bistro, Inc.* | 442,146 | |||||||||
16,744 | Wendy's International, Inc. | 485,576 | |||||||||
21,637 | Yum! Brands, Inc. | 880,192 | |||||||||
4,791,341 | |||||||||||
Total Common Stocks (Cost $16,678,170) | 15,113,037 |
Number of Shares | Value | ||||||||||
Money Market Fund—0.9% | |||||||||||
131,059 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $131,059) | $ | 131,059 | ||||||||
Total Investments (Cost $16,809,229)—100.9% | 15,244,096 | ||||||||||
Liabilities in excess of other assets—(0.9%) | (129,541 | ) | |||||||||
Net Assets—100.0% | $ | 15,114,555 |
* Non-income producing security.
See Notes to Financial Statements.
50
Schedule of Investments
PowerShares Dynamic Media Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.9% | |||||||||||
Advertising Agencies—5.3% | |||||||||||
34,609 | Omnicom Group, Inc. | $ | 1,652,234 | ||||||||
Advertising Sales—2.2% | |||||||||||
36,257 | Clear Channel Outdoor Holdings, Inc., Class A* | 689,608 | |||||||||
Advertising Services—2.8% | |||||||||||
26,217 | Getty Images, Inc.* | 855,985 | |||||||||
Broadcast Services/Program—3.3% | |||||||||||
66,576 | Liberty Media Corp. - Capital, Series A* | 1,023,273 | |||||||||
Cable TV—7.7% | |||||||||||
61,716 | DIRECTV Group (The), Inc.* | 1,520,683 | |||||||||
28,442 | DISH Network Corp., Class A* | 848,709 | |||||||||
2,369,392 | |||||||||||
Commercial Services—3.1% | |||||||||||
20,311 | CoStar Group, Inc.* | 973,912 | |||||||||
Computer Services—2.9% | |||||||||||
13,680 | IHS, Inc., Class A* | 903,564 | |||||||||
Direct Marketing—2.2% | |||||||||||
49,867 | Harte-Hanks, Inc. | 681,183 | |||||||||
E-Commerce/ Services—2.9% | |||||||||||
42,378 | IAC/InterActiveCorp.* | 881,886 | |||||||||
Internet Content - Information/News—3.1% | |||||||||||
30,271 | WebMD Health Corp., Class A* | 948,996 | |||||||||
Motion Pictures & Services—3.0% | |||||||||||
33,225 | DreamWorks Animation SKG, Inc., Class A* | 928,971 | |||||||||
Multimedia—17.0% | |||||||||||
20,185 | E.W. Scripps Co., Class A | 906,508 | |||||||||
177,903 | Gemstar-TV Guide International, Inc.* | 716,949 | |||||||||
19,449 | Meredith Corp. | 630,342 | |||||||||
99,041 | Time Warner, Inc. | 1,470,759 | |||||||||
47,706 | Walt Disney (The) Co. | 1,547,106 | |||||||||
5,271,664 | |||||||||||
Printing - Commercial—3.5% | |||||||||||
75,159 | Valassis Communications, Inc.* | 1,067,258 | |||||||||
Publishing - Books—2.2% | |||||||||||
24,184 | Scholastic Corp.* | 680,780 | |||||||||
Publishing - Newspapers—7.9% | |||||||||||
27,967 | Gannett Co., Inc. | 800,416 | |||||||||
45,261 | New York Times (The) Co., Class A | 882,589 | |||||||||
1,163 | Washington Post (The) Co., Class B | 762,463 | |||||||||
2,445,468 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Radio—5.4% | |||||||||||
76,731 | Cox Radio, Inc., Class A* | $ | 892,381 | ||||||||
296,928 | Sirius Satellite Radio, Inc.* | 763,105 | |||||||||
1,655,486 | |||||||||||
Television—10.2% | |||||||||||
67,747 | CBS Corp., Class B | 1,562,924 | |||||||||
38,332 | Hearst-Argyle Television, Inc. | 794,239 | |||||||||
91,365 | Sinclair Broadcast Group, Inc., Class A | 803,098 | |||||||||
3,160,261 | |||||||||||
Web Portals/ISP—15.2% | |||||||||||
3,283 | Google Inc., Class A* | 1,885,393 | |||||||||
18,707 | Sohu.com, Inc.* | 1,293,215 | |||||||||
55,650 | Yahoo!, Inc.* | 1,525,367 | |||||||||
4,703,975 | |||||||||||
Total Common Stocks (Cost $34,375,531) | 30,893,896 | ||||||||||
Money Market Fund—0.7% | |||||||||||
208,988 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $208,988) | 208,988 | |||||||||
Total Investments (Cost $34,584,519)—100.6% | 31,102,884 | ||||||||||
Liabilities in excess of other assets—(0.6%) | (179,706 | ) | |||||||||
Net Assets—100.0% | $ | 30,923,178 |
* Non-income producing security.
See Notes to Financial Statements.
51
Schedule of Investments
PowerShares Dynamic Networking Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.1% | |||||||||||
Computers—7.0% | |||||||||||
79,041 | Brocade Communications Systems, Inc.* | $ | 565,934 | ||||||||
29,523 | Echelon Corp.* | 332,429 | |||||||||
898,363 | |||||||||||
Internet—16.8% | |||||||||||
14,120 | Blue Coat Systems, Inc.* | 298,073 | |||||||||
14,961 | F5 Networks, Inc.* | 338,568 | |||||||||
18,270 | McAfee, Inc.* | 607,479 | |||||||||
40,831 | Secure Computing Corp.* | 270,301 | |||||||||
39,802 | SonicWALL, Inc.* | 306,077 | |||||||||
17,029 | Websense, Inc.* | 331,214 | |||||||||
2,151,712 | |||||||||||
Semiconductors—21.4% | |||||||||||
44,622 | Applied Micro Circuits Corp.* | 390,889 | |||||||||
32,143 | Broadcom Corp., Class A* | 834,433 | |||||||||
22,281 | Emulex Corp.* | 291,658 | |||||||||
69,216 | PMC - Sierra, Inc.* | 537,808 | |||||||||
20,918 | QLogic Corp.* | 333,851 | |||||||||
10,712 | Silicon Laboratories, Inc.* | 361,744 | |||||||||
2,750,383 | |||||||||||
Software—10.1% | |||||||||||
18,458 | Citrix Systems, Inc.* | 604,500 | |||||||||
10,361 | VMware, Inc., Class A* | 690,457 | |||||||||
1,294,957 | |||||||||||
Telecommunications—44.8% | |||||||||||
41,339 | Acme Packet, Inc.* | 378,252 | |||||||||
24,253 | ADC Telecommunications, Inc.* | 340,027 | |||||||||
17,999 | ADTRAN, Inc. | 425,856 | |||||||||
13,633 | Atheros Communications, Inc.* | 362,910 | |||||||||
12,835 | Ciena Corp.* | 433,951 | |||||||||
24,942 | Cisco Systems, Inc.* | 639,512 | |||||||||
7,643 | Comtech Telecommunications Corp.* | 296,013 | |||||||||
27,931 | Foundry Networks, Inc.* | 355,562 | |||||||||
37,210 | Harmonic, Inc.* | 307,727 | |||||||||
22,664 | Juniper Networks, Inc.* | 625,979 | |||||||||
15,195 | NETGEAR, Inc.* | 246,311 | |||||||||
14,346 | QUALCOMM, Inc. | 619,604 | |||||||||
94,999 | Sycamore Networks, Inc.* | 305,897 | |||||||||
27,837 | Tekelec* | 409,761 | |||||||||
5,747,362 | |||||||||||
Total Investments (Cost $14,376,262)—100.1% | 12,842,777 | ||||||||||
Liabilities in excess of other assets—(0.1%) | (11,395 | ) | |||||||||
Net Assets—100.0% | $ | 12,831,382 |
* Non-income producing security.
See Notes to Financial Statements.
52
Schedule of Investments
PowerShares Dynamic Oil & Gas Services Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.9% | |||||||||||
Engineering/R&D Services—4.6% | |||||||||||
326,934 | McDermott International, Inc.* | $ | 17,517,124 | ||||||||
Oil Components - Exploration & Production—2.8% | |||||||||||
168,854 | Unit Corp.* | 10,723,918 | |||||||||
Oil Field Machinery & Equipment—21.1% | |||||||||||
219,215 | Cameron International Corp.* | 10,791,954 | |||||||||
273,328 | Dresser-Rand Group, Inc.* | 9,995,605 | |||||||||
199,064 | Dril-Quip, Inc.* | 11,378,498 | |||||||||
164,353 | FMC Technologies, Inc.* | 11,044,522 | |||||||||
162,915 | Lufkin Industries, Inc. | 12,291,937 | |||||||||
357,029 | National Oilwell Varco, Inc.* | 24,438,635 | |||||||||
79,941,151 | |||||||||||
Oil & Gas Drilling—20.8% | |||||||||||
141,294 | Diamond Offshore Drilling, Inc. | 17,719,681 | |||||||||
155,619 | ENSCO International, Inc. | 9,917,599 | |||||||||
1,501,976 | Grey Wolf, Inc.* | 9,417,390 | |||||||||
207,724 | Helmerich & Payne, Inc. | 11,165,165 | |||||||||
351,778 | Noble Corp. | 19,798,065 | |||||||||
392,426 | Patterson-UTI Energy, Inc. | 10,964,382 | |||||||||
78,982,282 | |||||||||||
Oil-Field Services—39.5% | |||||||||||
253,714 | Baker Hughes, Inc. | 20,520,389 | |||||||||
445,757 | Halliburton Co. | 20,464,704 | |||||||||
207,261 | Hornbeck Offshore Services, Inc.* | 10,336,106 | |||||||||
689,287 | Key Energy Services, Inc.* | 9,443,232 | |||||||||
155,204 | Oceaneering International, Inc.* | 10,364,523 | |||||||||
220,879 | Oil States International, Inc.* | 11,057,203 | |||||||||
197,484 | Schlumberger Ltd. | 19,857,016 | |||||||||
97,013 | SEACOR Holdings, Inc.* | 8,256,776 | |||||||||
270,863 | Smith International, Inc. | 20,723,729 | |||||||||
228,859 | Superior Energy Services, Inc.* | 10,156,762 | |||||||||
235,634 | Trico Marine Services, Inc.* | 8,881,045 | |||||||||
150,061,485 | |||||||||||
Seismic Data Collection—2.9% | |||||||||||
700,697 | ION Geophysical Corp.* | 11,162,103 | |||||||||
Transport - Marine—5.7% | |||||||||||
183,819 | GulfMark Offshore, Inc.* | 10,992,376 | |||||||||
165,846 | Tidewater, Inc. | 10,816,476 | |||||||||
21,808,852 | |||||||||||
Transport - Services—2.5% | |||||||||||
176,503 | Bristow Group, Inc.* | 9,310,533 | |||||||||
Total Investments (Cost $322,093,288)—99.9% | 379,507,448 | ||||||||||
Other assets less liabilities—0.1% | 431,544 | ||||||||||
Net Assets—100.0% | $ | 379,938,992 |
* Non-income producing security.
See Notes to Financial Statements.
53
Schedule of Investments
PowerShares Dynamic Pharmaceuticals Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Cosmetics & Toiletries—2.4% | |||||||||||
36,992 | Chattem, Inc.* | $ | 2,585,001 | ||||||||
Medical Products—5.4% | |||||||||||
85,264 | Johnson & Johnson | 5,720,362 | |||||||||
Medical - Biomedical/Gene—22.3% | |||||||||||
116,056 | Amgen, Inc.* | 4,859,265 | |||||||||
49,375 | Biogen Idec, Inc.* | 2,996,569 | |||||||||
51,118 | Celgene Corp.* | 3,176,473 | |||||||||
69,740 | Genentech, Inc.* | 4,756,268 | |||||||||
40,631 | Genzyme Corp.* | 2,858,391 | |||||||||
205,974 | Millennium Pharmaceuticals, Inc.* | 5,122,572 | |||||||||
23,769,538 | |||||||||||
Medical - Drugs—49.9% | |||||||||||
98,653 | Abbott Laboratories | 5,203,946 | |||||||||
48,651 | Allergan, Inc. | 2,742,457 | |||||||||
127,448 | Bristol-Myers Squibb Co. | 2,800,033 | |||||||||
47,755 | Cephalon, Inc.* | 2,980,390 | |||||||||
105,615 | Eli Lilly & Co. | 5,084,306 | |||||||||
109,733 | Endo Pharmaceuticals Holdings, Inc.* | 2,724,670 | |||||||||
217,312 | Eurand N.V.* (Netherlands) | 3,466,126 | |||||||||
72,457 | Forest Laboratories, Inc.* | 2,514,982 | |||||||||
271,844 | King Pharmaceuticals, Inc.* | 2,552,615 | |||||||||
140,496 | Medicis Pharmaceutical Corp., Class A | 2,894,218 | |||||||||
119,251 | Merck & Co., Inc. | 4,536,308 | |||||||||
237,112 | Pfizer, Inc. | 4,768,322 | |||||||||
139,205 | Sciele Pharma, Inc. | 2,682,480 | |||||||||
134,215 | Sepracor, Inc.* | 2,892,333 | |||||||||
121,112 | Wyeth | 5,385,852 | |||||||||
53,229,038 | |||||||||||
Medical - Generic Drugs—14.3% | |||||||||||
114,439 | Alpharma, Inc., Class A* | 2,816,344 | |||||||||
175,384 | Caraco Pharmaceutical Laboratories Ltd.* | 2,890,328 | |||||||||
162,892 | Par Pharmaceutical Cos., Inc.* | 2,777,309 | |||||||||
86,222 | Perrigo Co. | 3,534,239 | |||||||||
103,616 | Watson Pharmaceuticals, Inc.* | 3,216,241 | |||||||||
15,234,461 | |||||||||||
Therapeutics—5.7% | |||||||||||
60,896 | Gilead Sciences, Inc.* | 3,151,977 | |||||||||
170,811 | Warner Chilcott Ltd., Class A* | 2,939,657 | |||||||||
6,091,634 | |||||||||||
Total Common Stocks (Cost $117,614,090) | 106,630,034 |
Number of Shares | Value | ||||||||||
Money Market Fund—0.1% | |||||||||||
91,004 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $91,004) | $ | 91,004 | ||||||||
Total Investments (Cost $117,705,094)—100.1% | 106,721,038 | ||||||||||
Liabilities in excess of other assets—(0.1%) | (106,065 | ) | |||||||||
Net Assets—100.0% | $ | 106,614,973 |
* Non-income producing security.
See Notes to Financial Statements.
54
Schedule of Investments
PowerShares Dynamic Retail Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.9% | |||||||||||
Distribution/Wholesale—2.6% | |||||||||||
8,953 | Genuine Parts Co. | $ | 380,144 | ||||||||
E-Commerce/Products—13.9% | |||||||||||
10,502 | Amazon.com, Inc.* | 825,772 | |||||||||
25,685 | eBay, Inc.* | 803,684 | |||||||||
11,694 | NetFlix, Inc.* | 373,974 | |||||||||
2,003,430 | |||||||||||
Food - Retail—8.3% | |||||||||||
11,451 | Ruddick Corp. | 443,154 | |||||||||
23,558 | Safeway, Inc. | 744,433 | |||||||||
1,187,587 | |||||||||||
Rental Auto/Equipment—5.6% | |||||||||||
25,718 | Dollar Thrifty Automotive Group* | 339,220 | |||||||||
21,535 | Rent-A-Center, Inc.* | 463,649 | |||||||||
802,869 | |||||||||||
Retail - Apparel/Shoe—33.4% | |||||||||||
4,763 | Abercrombie & Fitch Co., Class A | 353,939 | |||||||||
13,749 | Aeropostale, Inc.* | 437,081 | |||||||||
17,282 | American Eagle Outfitters, Inc. | 317,470 | |||||||||
15,375 | AnnTaylor Stores Corp.* | 388,988 | |||||||||
30,246 | Bebe Stores, Inc. | 302,158 | |||||||||
8,135 | Buckle (The), Inc. | 395,198 | |||||||||
18,968 | Charlotte Russe Holding, Inc.* | 301,212 | |||||||||
34,195 | Christopher & Banks Corp. | 405,211 | |||||||||
33,568 | Gap (The), Inc. | 625,035 | |||||||||
9,328 | Gymboree (The) Corp.* | 403,156 | |||||||||
16,029 | Men's Wearhouse, Inc. | 426,852 | |||||||||
12,832 | Urban Outfitters, Inc.* | 439,496 | |||||||||
4,795,796 | |||||||||||
Retail - Automobile—5.3% | |||||||||||
8,865 | Copart, Inc.* | 362,313 | |||||||||
24,920 | Rush Enterprises, Inc., Class A* | 401,710 | |||||||||
764,023 | |||||||||||
Retail - Computer Equipment—6.1% | |||||||||||
15,984 | GameStop Corp., Class A* | 879,759 | |||||||||
Retail - Consumer Electronics—6.8% | |||||||||||
15,742 | Best Buy Co., Inc. | 677,220 | |||||||||
21,164 | RadioShack Corp. | 294,180 | |||||||||
971,400 | |||||||||||
Retail - Discount—7.8% | |||||||||||
11,702 | BJ's Wholesale Club, Inc.* | 446,080 | |||||||||
21,158 | TJX (The) Cos., Inc. | 681,711 | |||||||||
1,127,791 | |||||||||||
Retail - Major Department Store—4.3% | |||||||||||
14,652 | J. C. Penney Co., Inc. | 622,710 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Transport - Equipment & Leasing—2.8% | |||||||||||
7,087 | Amerco, Inc.* | $ | 407,006 | ||||||||
Transport - Services—3.0% | |||||||||||
6,410 | Ryder System, Inc. | 438,893 | |||||||||
Total Common Stocks (Cost $14,260,347) | 14,381,408 | ||||||||||
Money Market Fund—0.9% | |||||||||||
130,181 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $130,181) | 130,181 | |||||||||
Total Investments (Cost $14,390,528)—100.8% | 14,511,589 | ||||||||||
Liabilities in excess of other assets—(0.8%) | (120,714 | ) | |||||||||
Net Assets—100.0% | $ | 14,390,875 |
* Non-income producing security.
See Notes to Financial Statements.
55
Schedule of Investments
PowerShares Dynamic Semiconductors Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Electronic Components & Semiconductors—53.7% | |||||||||||
198,715 | Altera Corp. | $ | 4,228,655 | ||||||||
158,376 | Amkor Technology, Inc.* | 1,512,491 | |||||||||
166,330 | Fairchild Semiconductor International, Inc.* | 2,168,943 | |||||||||
170,429 | Intel Corp. | 3,793,750 | |||||||||
81,449 | International Rectifier Corp.* | 1,853,779 | |||||||||
79,698 | Intersil Corp., Class A | 2,129,531 | |||||||||
44,573 | MEMC Electronic Materials, Inc.* | 2,806,762 | |||||||||
112,603 | National Semiconductor Corp. | 2,295,975 | |||||||||
158,954 | Nvidia Corp.* | 3,266,505 | |||||||||
387,177 | PMC - Sierra, Inc.* | 3,008,365 | |||||||||
145,569 | Semtech Corp.* | 2,364,041 | |||||||||
59,920 | Silicon Laboratories, Inc.* | 2,023,498 | |||||||||
113,488 | Texas Instruments, Inc. | 3,309,310 | |||||||||
152,064 | Xilinx, Inc. | 3,766,625 | |||||||||
135,068 | Zoran Corp.* | 1,777,495 | |||||||||
40,305,725 | |||||||||||
Lasers-Systems/Components—2.3% | |||||||||||
65,465 | Cymer, Inc.* | 1,701,435 | |||||||||
Semiconductor Components - Integrated Circuits—23.8% | |||||||||||
126,297 | Analog Devices, Inc. | 4,068,027 | |||||||||
56,011 | Hittite Microwave Corp.* | 2,223,637 | |||||||||
221,051 | Integrated Device Technology, Inc.* | 2,363,035 | |||||||||
252,327 | Micrel, Inc. | 2,477,851 | |||||||||
70,513 | Power Integrations, Inc.* | 2,197,890 | |||||||||
65,414 | Standard Microsystems Corp.* | 1,939,525 | |||||||||
392,919 | TriQuint Semiconductor, Inc.* | 2,589,336 | |||||||||
17,859,301 | |||||||||||
Semiconductor Equipment—20.2% | |||||||||||
177,364 | Applied Materials, Inc. | 3,309,612 | |||||||||
67,834 | ATMI, Inc.* | 1,997,033 | |||||||||
46,087 | Lam Research Corp.* | 1,882,193 | |||||||||
92,313 | MKS Instruments, Inc.* | 2,109,352 | |||||||||
83,993 | Novellus Systems, Inc.* | 1,836,087 | |||||||||
154,675 | Teradyne, Inc.* | 2,055,631 | |||||||||
92,267 | Verigy Ltd. (Singapore)* | 1,971,746 | |||||||||
15,161,654 | |||||||||||
Total Investments (Cost $84,095,244)—100.0% | 75,028,115 | ||||||||||
Other assets less liabilities—0.0% | 28,099 | ||||||||||
Net Assets—100.0% | $ | 75,056,214 |
* Non-income producing security.
See Notes to Financial Statements.
56
Schedule of Investments
PowerShares Dynamic Software Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.8% | |||||||||||
Applications Software—10.1% | |||||||||||
61,206 | Microsoft Corp. | $ | 1,745,595 | ||||||||
31,841 | Progress Software Corp.* | 962,553 | |||||||||
63,862 | Quest Software, Inc.* | 850,642 | |||||||||
3,558,790 | |||||||||||
Computer Aided Design—8.6% | |||||||||||
24,317 | Ansys, Inc.* | 978,273 | |||||||||
53,588 | Autodesk, Inc.* | 2,036,344 | |||||||||
3,014,617 | |||||||||||
Computer Services—5.3% | |||||||||||
12,935 | DST Systems, Inc.* | 774,030 | |||||||||
41,194 | Manhattan Associates, Inc.* | 1,071,456 | |||||||||
1,845,486 | |||||||||||
Computers - Integrated Systems—5.8% | |||||||||||
38,620 | Jack Henry & Associates, Inc. | 1,014,934 | |||||||||
28,362 | Micros Systems, Inc.* | 1,011,105 | |||||||||
2,026,039 | |||||||||||
Decision Support Software—2.9% | |||||||||||
23,895 | SPSS, Inc.* | 1,009,325 | |||||||||
Electronic Design Automation—8.8% | |||||||||||
37,366 | Ansoft Corp.* | 1,239,056 | |||||||||
85,569 | Cadence Design Systems, Inc.* | 952,383 | |||||||||
39,152 | Synopsys, Inc.* | 904,803 | |||||||||
3,096,242 | |||||||||||
Electronic Forms—5.3% | |||||||||||
49,510 | Adobe Systems, Inc.* | 1,846,228 | |||||||||
Enterprise Software/Services—31.1% | |||||||||||
51,612 | BMC Software, Inc.* | 1,794,033 | |||||||||
72,816 | CA, Inc. | 1,612,146 | |||||||||
82,091 | Epicor Software Corp.* | 656,728 | |||||||||
52,047 | Informatica Corp.* | 830,670 | |||||||||
53,235 | JDA Software Group, Inc.* | 1,006,142 | |||||||||
13,661 | MicroStrategy, Inc., Class A* | 1,212,141 | |||||||||
88,618 | Oracle Corp.* | 1,847,685 | |||||||||
34,138 | Sybase, Inc.* | 1,004,340 | |||||||||
65,613 | Tyler Technologies, Inc.* | 949,420 | |||||||||
10,913,305 | |||||||||||
Entertainment Software—4.7% | |||||||||||
61,138 | Activision, Inc.* | 1,653,783 | |||||||||
Industrial Audio & Video Production—2.3% | |||||||||||
20,537 | Dolby Laboratories, Inc., Class A* | 824,561 | |||||||||
Internet Application Software—2.6% | |||||||||||
75,981 | eResearch Technology, Inc.* | 925,449 | |||||||||
Internet Infrastructure Software—2.8% | |||||||||||
128,900 | TIBCO Software, Inc.* | 988,663 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Internet Security—4.9% | |||||||||||
98,933 | Symantec Corp.* | $ | 1,703,626 | ||||||||
Medical Information System—2.6% | |||||||||||
27,893 | Quality Systems, Inc. | 895,923 | |||||||||
Satellite Telecommunications—2.0% | |||||||||||
30,081 | GeoEye, Inc.* | 692,765 | |||||||||
Total Investments (Cost $35,933,221)—99.8% | 34,994,802 | ||||||||||
Other assets less liabilities—0.2% | 60,627 | ||||||||||
Net Assets—100.0% | $ | 35,055,429 |
* Non-income producing security.
See Notes to Financial Statements.
57
Statements of Assets and Liabilities
April 30, 2008
PowerShares Dynamic Banking Portfolio | PowerShares Dynamic Biotechnology & Genome Portfolio | PowerShares Dynamic Building & Construction Portfolio | PowerShares Dynamic Energy Exploration & Production Portfolio | PowerShares Dynamic Food & Beverage Portfolio | PowerShares Dynamic Hardware & Consumer Electronics Portfolio | PowerShares Dynamic Healthcare Services Portfolio | PowerShares Dynamic Insurance Portfolio | ||||||||||||||||||||||||||||
ASSETS: | |||||||||||||||||||||||||||||||||||
Investments at value | $ | 107,942,398 | $ | 199,314,122 | $ | 15,501,641 | $ | 138,842,091 | $ | 87,172,424 | $ | 5,959,919 | $ | 28,033,101 | $ | 33,967,186 | |||||||||||||||||||
Cash | — | — | 40,977 | 45,508 | — | 46,886 | 56,503 | 77,781 | |||||||||||||||||||||||||||
Receivables: | |||||||||||||||||||||||||||||||||||
Dividends | 52,334 | — | 12,277 | 13,464 | 92,351 | — | — | 8,058 | |||||||||||||||||||||||||||
Shares sold | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Expense waivers due from Adviser | 4,760 | 16,057 | 11,531 | 15,144 | 12,316 | 6,656 | — | 10,921 | |||||||||||||||||||||||||||
Investments sold | — | — | — | 5,341,795 | — | — | — | — | |||||||||||||||||||||||||||
Total Assets | 107,999,492 | 199,330,179 | 15,566,426 | 144,258,002 | 87,277,091 | 6,013,461 | 28,089,604 | 34,063,946 | |||||||||||||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||||||||||||||
Due to custodian | 229,824 | 163,476 | — | — | 185,843 | — | — | — | |||||||||||||||||||||||||||
Payables: | |||||||||||||||||||||||||||||||||||
Investments purchased | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Shares repurchased | — | — | — | 5,341,472 | — | — | — | — | |||||||||||||||||||||||||||
Expenses recapture due to Adviser | — | — | — | — | — | — | 1,597 | — | |||||||||||||||||||||||||||
Accrued advisory fees | 51,943 | 81,878 | 6,442 | 59,160 | 32,478 | 3,394 | 12,375 | 13,885 | |||||||||||||||||||||||||||
Accrued expenses | 69,545 | 85,222 | 36,795 | 55,001 | 45,837 | 39,092 | 50,113 | 38,314 | |||||||||||||||||||||||||||
Total Liabilities | 351,312 | 330,576 | 43,237 | 5,455,633 | 264,158 | 42,486 | 64,085 | 52,199 | |||||||||||||||||||||||||||
NET ASSETS | $ | 107,648,180 | $ | 198,999,603 | $ | 15,523,189 | $ | 138,802,369 | $ | 87,012,933 | $ | 5,970,975 | $ | 28,025,519 | $ | 34,011,747 | |||||||||||||||||||
NET ASSETS CONSIST OF: | |||||||||||||||||||||||||||||||||||
Shares of beneficial interest | $ | 117,806,360 | $ | 263,132,782 | $ | 21,573,565 | $ | 122,605,269 | $ | 91,162,296 | $ | 10,089,970 | $ | 39,349,842 | $ | 41,200,920 | |||||||||||||||||||
Undistributed net investment income | 1,009,971 | — | 19,258 | — | — | — | — | 41,414 | |||||||||||||||||||||||||||
Accumulated net realized loss on investments | (13,170,599 | ) | (65,011,475 | ) | (5,473,924 | ) | (6,683,453 | ) | (5,987,634 | ) | (2,666,547 | ) | (3,406,789 | ) | (6,127,868 | ) | |||||||||||||||||||
Net unrealized appreciation (depreciation) of investments | �� | 2,002,448 | 878,296 | (595,710 | ) | 22,880,553 | 1,838,271 | (1,452,448 | ) | (7,917,534 | ) | (1,102,719 | ) | ||||||||||||||||||||||
Net Assets | $ | 107,648,180 | $ | 198,999,603 | $ | 15,523,189 | $ | 138,802,369 | $ | 87,012,933 | $ | 5,970,975 | $ | 28,025,519 | $ | 34,011,747 | |||||||||||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 5,500,000 | 11,200,000 | 900,000 | 5,200,000 | 5,200,000 | 400,000 | 1,200,000 | 2,100,000 | |||||||||||||||||||||||||||
Net asset value | $ | 19.57 | $ | 17.77 | $ | 17.25 | $ | 26.69 | $ | 16.73 | $ | 14.93 | $ | 23.35 | $ | 16.20 | |||||||||||||||||||
Investments at cost | $ | 105,939,950 | $ | 198,435,826 | $ | 16,097,351 | $ | 115,961,538 | $ | 85,334,153 | $ | 7,412,367 | $ | 35,950,635 | $ | 35,069,905 |
See Notes to Financial Statements.
58
PowerShares Dynamic Leisure and Entertainment Portfolio | PowerShares Dynamic Media Portfolio | PowerShares Dynamic Networking Portfolio | PowerShares Dynamic Oil & Gas Services Portfolio | PowerShares Dynamic Pharmaceuticals Portfolio | PowerShares Dynamic Retail Portfolio | PowerShares Dynamic Semiconductors Portfolio | PowerShares Dynamic Software Portfolio | ||||||||||||||||||||||||||||
ASSETS: | |||||||||||||||||||||||||||||||||||
Investments at value | $ | 15,244,096 | $ | 31,102,884 | $ | 12,842,777 | $ | 379,507,448 | $ | 106,721,038 | $ | 14,511,589 | $ | 75,028,115 | $ | 34,994,802 | |||||||||||||||||||
Cash | — | — | 17,097 | 213,843 | — | — | 155,796 | 103,412 | |||||||||||||||||||||||||||
Receivables: | |||||||||||||||||||||||||||||||||||
Dividends | 7,180 | 2,834 | 1,620 | 452,955 | 76,507 | 4,689 | 11,349 | — | |||||||||||||||||||||||||||
Shares sold | — | — | — | 2,988,205 | — | — | — | — | |||||||||||||||||||||||||||
Expense waivers due from Adviser | 8,372 | 8,753 | 10,636 | 23,811 | 9,002 | 9,840 | 7,000 | 9,184 | |||||||||||||||||||||||||||
Investments sold | — | — | — | 234,744 | — | — | — | — | |||||||||||||||||||||||||||
Total Assets | 15,259,648 | 31,114,471 | 12,872,130 | 383,421,006 | 106,806,547 | 14,526,118 | 75,202,260 | 35,107,398 | |||||||||||||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||||||||||||||
Due to custodian | 104,037 | 142,298 | — | — | 95,334 | 95,441 | — | — | |||||||||||||||||||||||||||
Payables: | |||||||||||||||||||||||||||||||||||
Investments purchased | — | — | — | 3,233,966 | — | — | 70,395 | — | |||||||||||||||||||||||||||
Shares repurchased | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Expenses recapture due to Adviser | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Accrued advisory fees | 6,055 | 11,917 | 5,087 | 152,866 | 44,646 | 5,314 | 29,889 | 14,104 | |||||||||||||||||||||||||||
Accrued expenses | 35,001 | 37,078 | 35,661 | 95,182 | 51,594 | 34,488 | 45,762 | 37,865 | |||||||||||||||||||||||||||
Total Liabilities | 145,093 | 191,293 | 40,748 | 3,482,014 | 191,574 | 135,243 | 146,046 | 51,969 | |||||||||||||||||||||||||||
NET ASSETS | $ | 15,114,555 | $ | 30,923,178 | $ | 12,831,382 | $ | 379,938,992 | $ | 106,614,973 | $ | 14,390,875 | $ | 75,056,214 | $ | 35,055,429 | |||||||||||||||||||
NET ASSETS CONSIST OF: | |||||||||||||||||||||||||||||||||||
Shares of beneficial interest | $ | 23,146,176 | $ | 43,407,543 | $ | 19,201,515 | $ | 360,209,604 | $ | 123,913,863 | $ | 19,145,386 | $ | 111,008,388 | $ | 45,588,808 | |||||||||||||||||||
Undistributed net investment income | — | — | — | 45,350 | 202,994 | — | — | — | |||||||||||||||||||||||||||
Accumulated net realized loss on investments | (6,466,488 | ) | (9,002,730 | ) | (4,836,648 | ) | (37,730,122 | ) | (6,517,828 | ) | (4,875,572 | ) | (26,885,045 | ) | (9,594,960 | ) | |||||||||||||||||||
Net unrealized appreciation (depreciation) of investments | (1,565,133 | ) | (3,481,635 | ) | (1,533,485 | ) | 57,414,160 | (10,984,056 | ) | 121,061 | (9,067,129 | ) | (938,419 | ) | |||||||||||||||||||||
Net Assets | $ | 15,114,555 | $ | 30,923,178 | $ | 12,831,382 | $ | 379,938,992 | $ | 106,614,973 | $ | 14,390,875 | $ | 75,056,214 | $ | 35,055,429 | |||||||||||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 1,000,000 | 2,300,000 | 800,000 | 13,000,000 | 6,200,000 | 900,000 | 4,600,000 | 2,000,000 | |||||||||||||||||||||||||||
Net asset value | $ | 15.11 | $ | 13.44 | $ | 16.04 | $ | 29.23 | $ | 17.20 | $ | 15.99 | $ | 16.32 | $ | 17.53 | |||||||||||||||||||
Investments at cost | $ | 16,809,229 | $ | 34,584,519 | $ | 14,376,262 | $ | 322,093,288 | $ | 117,705,094 | $ | 14,390,528 | $ | 84,095,244 | $ | 35,933,221 |
59
Statements of Operations
Year Ended April 30, 2008
PowerShares Dynamic Banking Portfolio | PowerShares Dynamic Biotechnology & Genome Portfolio | PowerShares Dynamic Building & Construction Portfolio | PowerShares Dynamic Energy Exploration & Production Portfolio | PowerShares Dynamic Food & Beverage Portfolio | PowerShares Dynamic Hardware Consumer Electronics Portfolio | PowerShares Dynamic Healthcare Services Portfolio | PowerShares Dynamic Insurance Portfolio | ||||||||||||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||||||||||||||
Unaffiliated dividend income | $ | 2,075,929 | $ | 145,594 | $ | 152,706 | $ | 1,274,344 | $ | 726,819 | $ | 42,851 | $ | 65,273 | $ | 1,076,102 | |||||||||||||||||||
Affiliated money market dividend income | 3,234 | — | 1 | 16 | 5,458 | — | — | — | |||||||||||||||||||||||||||
Foreign withholding taxes | (1,283 | ) | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Total Income | 2,077,880 | 145,594 | 152,707 | 1,274,360 | 732,277 | 42,851 | 65,273 | 1,076,102 | |||||||||||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||||||||||||||
Advisory fees | 307,703 | 1,176,263 | 105,659 | 743,351 | 210,919 | 68,448 | 261,554 | 248,412 | |||||||||||||||||||||||||||
Administration & Accounting fees | 75,160 | 80,738 | 80,738 | 80,738 | 80,738 | 80,738 | 74,983 | 80,738 | |||||||||||||||||||||||||||
Sub-licensing | 30,770 | 70,576 | 6,340 | 44,601 | 12,655 | 4,107 | 26,156 | 14,905 | |||||||||||||||||||||||||||
Printing | 22,413 | 50,603 | 7,108 | 27,719 | 16,588 | 1,006 | 8,698 | 8,623 | |||||||||||||||||||||||||||
Audit | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | |||||||||||||||||||||||||||
Registration & filings | 9,186 | — | — | — | — | — | 6,381 | — | |||||||||||||||||||||||||||
Custodian & transfer agent fees | 6,892 | 15,460 | 6,554 | 10,963 | 6,373 | 6,242 | 6,493 | 6,554 | |||||||||||||||||||||||||||
Professional tax review | 6,706 | 11,072 | 11,072 | 11,072 | 11,072 | 11,072 | 6,706 | 11,072 | |||||||||||||||||||||||||||
Trustees | 5,655 | 10,875 | 5,068 | 8,424 | 5,395 | 4,861 | 5,654 | 5,880 | |||||||||||||||||||||||||||
Listing fee and expenses | 2,264 | 8,721 | 8,423 | 8,597 | 8,355 | 7,869 | 2,300 | 8,488 | |||||||||||||||||||||||||||
Legal | — | 9,298 | 381 | 4,753 | 970 | — | — | 1,929 | |||||||||||||||||||||||||||
Other expenses | 218 | 15,300 | 2,322 | 8,114 | 1,532 | 574 | 1,288 | 3,707 | |||||||||||||||||||||||||||
Total Expenses | 482,815 | 1,464,754 | 249,513 | 964,180 | 370,445 | 200,765 | 416,061 | 406,156 | |||||||||||||||||||||||||||
(Waivers) and/or Recapture | (74,802 | ) | 17,336 | (116,382 | ) | (27,558 | ) | (104,686 | ) | (114,521 | ) | (68,092 | ) | (93,139 | ) | ||||||||||||||||||||
Net Expenses | 408,013 | 1,482,090 | 133,131 | 936,622 | 265,759 | 86,244 | 347,969 | 313,017 | |||||||||||||||||||||||||||
Net Investment Income (Loss) | 1,669,867 | (1,336,496 | ) | 19,576 | 337,738 | 466,518 | (43,393 | ) | (282,696 | ) | 763,085 | ||||||||||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||||||||||||||||||||||
Net realized gain (loss) from: | |||||||||||||||||||||||||||||||||||
Investments | (12,885,656 | ) | (35,659,327 | ) | (2,909,662 | ) | (3,281,867 | ) | (3,252,254 | ) | (1,038,788 | ) | (3,190,748 | ) | (5,076,599 | ) | |||||||||||||||||||
In-kind redemptions | 750,310 | 35,600,018 | 2,826,507 | 26,048,011 | 5,961,572 | 535,387 | (10,394,290 | ) | 2,693,245 | ||||||||||||||||||||||||||
Net realized gain (loss) | (12,135,346 | ) | (59,309 | ) | (83,155 | ) | 22,766,144 | 2,709,318 | (503,401 | ) | (13,585,038 | ) | (2,383,354 | ) | |||||||||||||||||||||
Net change in unrealized appreciation/ (depreciation) on investments | 2,176,920 | (21,265,610 | ) | (2,997,274 | ) | 6,700,824 | (1,717,175 | ) | (2,563,775 | ) | (9,150,564 | ) | (5,113,803 | ) | |||||||||||||||||||||
Net realized and unrealized gain (loss) on investments | (9,958,426 | ) | (21,324,919 | ) | (3,080,429 | ) | 29,466,968 | 992,143 | (3,067,176 | ) | (22,735,602 | ) | (7,497,157 | ) | |||||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | (8,288,559 | ) | $ | (22,661,415 | ) | $ | (3,060,853 | ) | $ | 29,804,706 | $ | 1,458,661 | $ | (3,110,569 | ) | $ | (23,018,298 | ) | $ | (6,734,072 | ) |
See Notes to Financial Statements.
60
PowerShares Dynamic Leisure and Entertainment Portfolio | PowerShares Dynamic Media Portfolio | PowerShares Dynamic Networking Portfolio | PowerShares Dynamic Oil & Gas Services Portfolio | PowerShares Dynamic Pharmaceuticals Portfolio | PowerShares Dynamic Retail Portfolio | PowerShares Dynamic Semiconductors Portfolio | PowerShares Dynamic Software Portfolio | ||||||||||||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||||||||||||||
Unaffiliated dividend income | $ | 449,333 | $ | 437,280 | $ | 22,720 | $ | 2,115,582 | $ | 1,200,974 | $ | 117,108 | $ | 766,494 | $ | 80,403 | |||||||||||||||||||
Affiliated money market dividend income | 2,575 | 6,773 | — | 1,265 | 808 | 3,783 | — | — | |||||||||||||||||||||||||||
Foreign withholding taxes | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Total Income | 451,908 | 444,053 | 22,720 | 2,116,847 | 1,201,782 | 120,891 | 766,494 | �� | 80,403 | ||||||||||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||||||||||||||
Advisory fees | 169,825 | 224,636 | 95,117 | 1,899,245 | 523,019 | 71,056 | 648,630 | 286,919 | |||||||||||||||||||||||||||
Administration & Accounting fees | 80,738 | 80,738 | 80,738 | 106,189 | 80,738 | 80,738 | 80,738 | 80,738 | |||||||||||||||||||||||||||
Sub-licensing | 10,189 | 13,478 | 5,707 | 113,955 | 31,381 | 4,263 | 38,918 | 17,215 | |||||||||||||||||||||||||||
Printing | 10,045 | 11,364 | 7,461 | 63,954 | 26,916 | 1,738 | 26,703 | 9,666 | |||||||||||||||||||||||||||
Audit | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | |||||||||||||||||||||||||||
Registration & filings | — | — | — | 755 | — | — | 857 | — | |||||||||||||||||||||||||||
Custodian & transfer agent fees | 6,445 | 6,445 | 6,445 | 22,458 | 8,237 | 6,553 | 10,058 | 6,518 | |||||||||||||||||||||||||||
Professional tax review | 11,072 | 11,072 | 11,072 | 11,072 | 11,072 | 11,072 | 11,072 | 11,072 | |||||||||||||||||||||||||||
Trustees | 5,513 | 5,694 | 4,995 | 14,345 | 7,029 | 4,896 | 8,167 | 6,181 | |||||||||||||||||||||||||||
Listing fee and expenses | 8,382 | 8,356 | 8,332 | 8,857 | 8,437 | 8,433 | 8,489 | 8,421 | |||||||||||||||||||||||||||
Legal | 1,564 | 1,968 | 883 | 12,539 | 3,395 | 490 | 6,201 | 1,929 | |||||||||||||||||||||||||||
Other expenses | 2,272 | 1,441 | 858 | 15,644 | 3,784 | 2,567 | 8,902 | 3,281 | |||||||||||||||||||||||||||
Total Expenses | 321,893 | 381,040 | 237,456 | 2,284,861 | 719,856 | 207,654 | 864,583 | 447,788 | |||||||||||||||||||||||||||
(Waivers) and/or Recapture | (107,914 | ) | (97,999 | ) | (117,609 | ) | 59,480 | (60,852 | ) | (118,124 | ) | (47,309 | ) | (86,270 | ) | ||||||||||||||||||||
Net Expenses | 213,979 | 283,041 | 119,847 | 2,344,341 | 659,004 | 89,530 | 817,274 | 361,518 | |||||||||||||||||||||||||||
Net Investment Income (Loss) | 237,929 | 161,012 | (97,127 | ) | (227,494 | ) | 542,778 | 31,361 | (50,780 | ) | (281,115 | ) | |||||||||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||||||||||||||||||||||
Net realized gain (loss) from: | |||||||||||||||||||||||||||||||||||
Investments | (3,350,404 | ) | (4,606,396 | ) | (1,997,944 | ) | (13,609,747 | ) | (5,542,080 | ) | (3,553,424 | ) | (14,652,738 | ) | (5,649,311 | ) | |||||||||||||||||||
In-kind redemptions | 2,783,000 | (1,929,645 | ) | 1,052,591 | 63,067,723 | 7,919,993 | 861,832 | 9,431,086 | 5,300,720 | ||||||||||||||||||||||||||
Net realized gain (loss) | (567,404 | ) | (6,536,041 | ) | (945,353 | ) | 49,457,976 | 2,377,913 | (2,691,592 | ) | (5,221,652 | ) | (348,591 | ) | |||||||||||||||||||||
Net change in unrealized appreciation/ (depreciation) on investments | (5,546,327 | ) | (4,371,386 | ) | (1,976,065 | ) | 27,334,628 | (17,014,573 | ) | (644,652 | ) | (17,046,491 | ) | (7,898,477 | ) | ||||||||||||||||||||
Net realized and unrealized gain (loss) on investments | (6,113,731 | ) | (10,907,427 | ) | (2,921,418 | ) | 76,792,604 | (14,636,660 | ) | (3,336,244 | ) | (22,268,143 | ) | (8,247,068 | ) | ||||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | (5,875,802 | ) | $ | (10,746,415 | ) | $ | (3,018,545 | ) | $ | 76,565,110 | $ | (14,093,882 | ) | $ | (3,304,883 | ) | $ | (22,318,923 | ) | $ | (8,528,183 | ) |
61
Statements of Changes in Net Assets
PowerShares Dynamic Banking Portfolio | PowerShares Dynamic Biotechnology & Genome Portfolio | PowerShares Dynamic Building & Construction Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | 1,669,867 | $ | 69,266 | $ | (1,336,496 | ) | $ | (1,295,830 | ) | $ | 19,576 | $ | 22,440 | |||||||||||||
Net realized gain (loss) on investments | (12,135,346 | ) | (209,965 | ) | (59,309 | ) | (4,168,259 | ) | (83,155 | ) | (1,824,946 | ) | |||||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | 2,176,920 | (174,472 | ) | (21,265,610 | ) | 30,260,487 | (2,997,274 | ) | 1,243,144 | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (8,288,559 | ) | (315,171 | ) | (22,661,415 | ) | 24,796,398 | (3,060,853 | ) | (559,362 | ) | ||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | (165,457 | ) | (19,989 | ) | 177,867 | 98,651 | (22,619 | ) | 13,852 | ||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (684,636 | ) | (44,552 | ) | — | — | (18,567 | ) | (4,191 | ) | |||||||||||||||||
Return of capital | — | — | — | — | — | — | |||||||||||||||||||||
Total distributions to shareholders | (684,636 | ) | (44,552 | ) | — | — | (18,567 | ) | (4,191 | ) | |||||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 227,990,630 | 22,356,336 | 229,940,570 | 155,765,402 | 56,345,601 | 17,839,986 | |||||||||||||||||||||
Value of shares repurchased | (116,105,241 | ) | (17,260,627 | ) | (266,895,466 | ) | (171,967,279 | ) | (56,441,780 | ) | (23,983,205 | ) | |||||||||||||||
Net income equalization | 165,457 | 19,989 | (177,867 | ) | (98,651 | ) | 22,619 | (13,852 | ) | ||||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 112,050,846 | 5,115,698 | (37,132,763 | ) | (16,300,528 | ) | (73,560 | ) | (6,157,071 | ) | |||||||||||||||||
Increase (Decrease) in Net Assets | 102,912,194 | 4,735,986 | (59,616,311 | ) | 8,594,521 | (3,175,599 | ) | (6,706,772 | ) | ||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 4,735,986 | — | 258,615,914 | 250,021,393 | 18,698,788 | 25,405,560 | |||||||||||||||||||||
End of period | $ | 107,648,180 | $ | 4,735,986 | $ | 198,999,603 | $ | 258,615,914 | $ | 15,523,189 | $ | 18,698,788 | |||||||||||||||
Undistributed net investment income at end of period | $ | 1,009,971 | $ | 24,714 | $ | — | $ | — | $ | 19,258 | $ | 18,249 | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 11,000,000 | 900,000 | 12,300,000 | 8,900,000 | 3,000,000 | 1,100,000 | |||||||||||||||||||||
Shares repurchased | (5,700,000 | ) | (700,000 | ) | (14,500,000 | ) | (10,000,000 | ) | (3,100,000 | ) | (1,500,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 200,000 | — | 13,400,000 | 14,500,000 | 1,000,000 | 1,400,000 | |||||||||||||||||||||
Shares outstanding, end of period | 5,500,000 | 200,000 | 11,200,000 | 13,400,000 | 900,000 | 1,000,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
62
PowerShares Dynamic Energy Exploration & Production Portfolio | PowerShares Dynamic Food & Beverage Portfolio | PowerShares Dynamic Hardware & Consumer Electronics Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | 337,738 | $ | 499,053 | $ | 466,518 | $ | 691,123 | $ | (43,393 | ) | $ | (58,128 | ) | |||||||||||||
Net realized gain (loss) on investments | 22,766,144 | 4,218,041 | 2,709,318 | 1,049,116 | (503,401 | ) | (283,424 | ) | |||||||||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | 6,700,824 | 7,881,779 | (1,717,175 | ) | 2,942,933 | (2,563,775 | ) | 285,507 | |||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | 29,804,706 | 12,598,873 | 1,458,661 | 4,683,172 | (3,110,569 | ) | (56,045 | ) | |||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 26,395 | (44,428 | ) | 170,513 | 28,365 | (46,779 | ) | 17,722 | |||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (387,353 | ) | (351,098 | ) | (889,330 | ) | (306,737 | ) | — | — | |||||||||||||||||
Return of capital | (12,322 | ) | — | (369,392 | ) | — | (303,093 | ) | — | ||||||||||||||||||
Total distributions to shareholders | (399,675 | ) | (351,098 | ) | (1,258,722 | ) | (306,737 | ) | (303,093 | ) | — | ||||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 148,755,294 | 142,236,445 | 114,332,928 | 29,846,194 | 20,684,926 | 11,586,059 | |||||||||||||||||||||
Value of shares repurchased | (162,846,293 | ) | (142,790,736 | ) | (60,833,736 | ) | (25,178,900 | ) | (23,820,679 | ) | (15,773,610 | ) | |||||||||||||||
Net income equalization | (26,395 | ) | 44,428 | (170,513 | ) | (28,365 | ) | 46,779 | (17,722 | ) | |||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | (14,117,394 | ) | (509,863 | ) | 53,328,679 | 4,638,929 | (3,088,974 | ) | (4,205,273 | ) | |||||||||||||||||
Increase (Decrease) in Net Assets | 15,314,032 | 11,693,484 | 53,699,131 | 9,043,729 | (6,549,415 | ) | (4,243,596 | ) | |||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 123,488,337 | 111,794,853 | 33,313,802 | 24,270,073 | 12,520,390 | 16,763,986 | |||||||||||||||||||||
End of period | $ | 138,802,369 | $ | 123,488,337 | $ | 87,012,933 | $ | 33,313,802 | $ | 5,970,975 | $ | 12,520,390 | |||||||||||||||
Undistributed net investment income at end of period | $ | — | $ | 96,401 | $ | — | $ | 422,812 | $ | — | $ | — | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 6,400,000 | 7,600,000 | 6,900,000 | 1,900,000 | 1,100,000 | 700,000 | |||||||||||||||||||||
Shares repurchased | (7,000,000 | ) | (7,800,000 | ) | (3,600,000 | ) | (1,600,000 | ) | (1,400,000 | ) | (1,000,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 5,800,000 | 6,000,000 | 1,900,000 | 1,600,000 | 700,000 | 1,000,000 | |||||||||||||||||||||
Shares outstanding, end of period | 5,200,000 | 5,800,000 | 5,200,000 | 1,900,000 | 400,000 | 700,000 |
63
Statements of Changes in Net Assets (Continued)
PowerShares Healthcare Services Portfolio | PowerShares Dynamic Insurance Portfolio | PowerShares Dynamic Leisure and Entertainment Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | (282,696 | ) | $ | (54,123 | ) | $ | 763,085 | $ | 372,086 | $ | 237,929 | $ | 139,932 | |||||||||||||
Net realized gain (loss) on investments | (13,585,038 | ) | 849,715 | (2,383,354 | ) | 1,728,304 | (567,404 | ) | 2,116,697 | ||||||||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | (9,150,564 | ) | 1,233,030 | (5,113,803 | ) | 2,466,573 | (5,546,327 | ) | 1,377,435 | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (23,018,298 | ) | 2,028,622 | (6,734,072 | ) | 4,566,963 | (5,875,802 | ) | 3,634,064 | ||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 63,340 | (26,513 | ) | (97,621 | ) | 26,238 | (309,164 | ) | 17,232 | ||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | — | — | (785,432 | ) | (333,066 | ) | (237,929 | ) | (158,121 | ) | |||||||||||||||||
Return of capital | — | — | — | — | (485,571 | ) | (21,748 | ) | |||||||||||||||||||
Total distributions to shareholders | — | — | (785,432 | ) | (333,066 | ) | (723,500 | ) | (179,869 | ) | |||||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 153,002,599 | 41,920,078 | 43,758,738 | 67,091,384 | 61,308,076 | 48,534,706 | |||||||||||||||||||||
Value of shares repurchased | (130,000,271 | ) | (15,907,211 | ) | (60,628,701 | ) | (44,088,414 | ) | (89,066,554 | ) | (30,217,844 | ) | |||||||||||||||
Net income equalization | (63,340 | ) | 26,513 | 97,621 | (26,238 | ) | 309,164 | (17,232 | ) | ||||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 22,938,988 | 26,039,380 | (16,772,342 | ) | 22,976,732 | (27,449,314 | ) | 18,299,630 | |||||||||||||||||||
Increase (Decrease) in Net Assets | (15,970 | ) | 28,041,489 | (24,389,467 | ) | 27,236,867 | (34,357,780 | ) | 21,771,057 | ||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 28,041,489 | — | 58,401,214 | 31,164,347 | 49,472,335 | 27,701,278 | |||||||||||||||||||||
End of period | $ | 28,025,519 | $ | 28,041,489 | $ | 34,011,747 | $ | 58,401,214 | $ | 15,114,555 | $ | 49,472,335 | |||||||||||||||
Undistributed net investment income at end of period | $ | — | $ | — | $ | 41,414 | $ | 63,761 | $ | — | $ | — | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 5,400,000 | 1,600,000 | 2,400,000 | 3,800,000 | 3,600,000 | 2,800,000 | |||||||||||||||||||||
Shares repurchased | (5,200,000 | ) | (600,000 | ) | (3,400,000 | ) | (2,500,000 | ) | (5,300,000 | ) | (1,800,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 1,000,000 | — | 3,100,000 | 1,800,000 | 2,700,000 | 1,700,000 | |||||||||||||||||||||
Shares outstanding, end of period | 1,200,000 | 1,000,000 | 2,100,000 | 3,100,000 | 1,000,000 | 2,700,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
64
PowerShares Dynamic Media Portfolio | PowerShares Dynamic Networking Portfolio | PowerShares Dynamic Oil & Gas Services Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | 161,012 | $ | 62,910 | $ | (97,127 | ) | $ | (131,055 | ) | $ | (227,494 | ) | $ | 45,350 | ||||||||||||
Net realized gain (loss) on investments | (6,536,041 | ) | 1,254,097 | (945,353 | ) | 3,855,985 | 49,457,976 | (542,568 | ) | ||||||||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | (4,371,386 | ) | 858,209 | (1,976,065 | ) | (2,673,735 | ) | 27,334,628 | 4,979,597 | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (10,746,415 | ) | 2,175,216 | (3,018,545 | ) | 1,051,195 | 76,565,110 | 4,482,379 | |||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | (100,942 | ) | (9,491 | ) | 6,671 | 36,561 | 47,462 | 45,370 | |||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (173,173 | ) | (58,259 | ) | — | — | — | — | |||||||||||||||||||
Return of capital | (655,987 | ) | — | — | — | — | — | ||||||||||||||||||||
Total distributions to shareholders | (829,160 | ) | (58,259 | ) | — | — | — | — | |||||||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 107,963,303 | 45,055,211 | 18,413,457 | 43,920,427 | 351,285,457 | 192,578,053 | |||||||||||||||||||||
Value of shares repurchased | (96,769,925 | ) | (40,409,878 | ) | (21,240,566 | ) | (54,100,512 | ) | (320,367,537 | ) | (260,736,085 | ) | |||||||||||||||
Net income equalization | 100,942 | 9,491 | (6,671 | ) | (36,561 | ) | (47,462 | ) | (45,370 | ) | |||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 11,294,320 | 4,654,824 | (2,833,780 | ) | (10,216,646 | ) | 30,870,458 | (68,203,402 | ) | ||||||||||||||||||
Increase (Decrease) in Net Assets | (382,197 | ) | 6,762,290 | (5,845,654 | ) | (9,128,890 | ) | 107,483,030 | (63,675,653 | ) | |||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 31,305,375 | 24,543,085 | 18,677,036 | 27,805,926 | 272,455,962 | 336,131,615 | |||||||||||||||||||||
End of period | $ | 30,923,178 | $ | 31,305,375 | $ | 12,831,382 | $ | 18,677,036 | $ | 379,938,992 | $ | 272,455,962 | |||||||||||||||
Undistributed net investment income at end of period | $ | — | $ | 12,161 | $ | — | $ | — | $ | 45,350 | $ | 45,350 | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 6,900,000 | 2,900,000 | 1,000,000 | 2,600,000 | 13,500,000 | 9,500,000 | |||||||||||||||||||||
Shares repurchased | (6,500,000 | ) | (2,700,000 | ) | (1,200,000 | ) | (3,200,000 | ) | (12,500,000 | ) | (13,200,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 1,900,000 | 1,700,000 | 1,000,000 | 1,600,000 | 12,000,000 | 15,700,000 | |||||||||||||||||||||
Shares outstanding, end of period | 2,300,000 | 1,900,000 | 800,000 | 1,000,000 | 13,000,000 | 12,000,000 |
65
Statements of Changes in Net Assets (Continued)
PowerShares Dynamic Pharmaceuticals Portfolio | PowerShares Dynamic Retail Portfolio | ||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||
OPERATIONS: | |||||||||||||||||||
Net investment income (loss) | $ | 542,778 | $ | 332,121 | $ | 31,361 | $ | 69,426 | |||||||||||
Net realized gain (loss) on investments | 2,377,913 | 6,281,890 | (2,691,592 | ) | 2,367,368 | ||||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | (17,014,573 | ) | 7,374,349 | (644,652 | ) | (1,871,851 | ) | ||||||||||||
Net increase (decrease) in net assets resulting from operations | (14,093,882 | ) | 13,988,360 | (3,304,883 | ) | 564,943 | |||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | (52,293 | ) | (24,592 | ) | (60,052 | ) | (3,544 | ) | |||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||
Net investment income | (339,784 | ) | (367,491 | ) | (53,516 | ) | (54,224 | ) | |||||||||||
Return of capital | — | (27,281 | ) | (28,135 | ) | — | |||||||||||||
Total distributions to shareholders | (339,784 | ) | (394,772 | ) | (81,651 | ) | (54,224 | ) | |||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||
Proceeds from shares sold | 114,128,748 | 72,406,707 | 41,315,136 | 77,371,444 | |||||||||||||||
Value of shares repurchased | (75,425,400 | ) | (69,811,556 | ) | (47,566,973 | ) | (77,636,176 | ) | |||||||||||
Net income equalization | 52,293 | 24,592 | 60,052 | 3,544 | |||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 38,755,641 | 2,619,743 | (6,191,785 | ) | (261,188 | ) | |||||||||||||
Increase (Decrease) in Net Assets | 24,269,682 | 16,188,739 | (9,638,371 | ) | 245,987 | ||||||||||||||
NET ASSETS: | |||||||||||||||||||
Beginning of year | 82,345,291 | 66,156,552 | 24,029,246 | 23,783,259 | |||||||||||||||
End of year | $ | 106,614,973 | $ | 82,345,291 | $ | 14,390,875 | $ | 24,029,246 | |||||||||||
Undistributed net investment income at end of year | $ | 202,994 | $ | — | $ | — | $ | 22,155 | |||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||
Shares sold | 6,100,000 | 4,200,000 | 2,400,000 | 4,300,000 | |||||||||||||||
Shares repurchased | (4,100,000 | ) | (4,000,000 | ) | (2,700,000 | ) | (4,400,000 | ) | |||||||||||
Shares outstanding, beginning of year | 4,200,000 | 4,000,000 | 1,200,000 | 1,300,000 | |||||||||||||||
Shares outstanding, end of year | 6,200,000 | 4,200,000 | 900,000 | 1,200,000 |
See Notes to Financial Statements.
66
PowerShares Dynamic Semiconductors Portfolio | PowerShares Dynamic Software Portfolio | ||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||
OPERATIONS: | |||||||||||||||||||
Net investment income (loss) | $ | (50,780 | ) | $ | (190,009 | ) | $ | (281,115 | ) | $ | (339,292 | ) | |||||||
Net realized gain (loss) on investments | (5,221,652 | ) | (1,261,539 | ) | (348,591 | ) | 6,849,312 | ||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | (17,046,491 | ) | (3,142,437 | ) | (7,898,477 | ) | 2,073,236 | ||||||||||||
Net increase (decrease) in net assets resulting from operations | (22,318,923 | ) | (4,593,985 | ) | (8,528,183 | ) | 8,583,256 | ||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 124,852 | (71,444 | ) | 139,588 | 1,824 | ||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||
Net investment income | — | — | — | — | |||||||||||||||
Return of capital | — | — | — | — | |||||||||||||||
Total distributions to shareholders | — | — | — | — | |||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||
Proceeds from shares sold | 199,521,339 | 159,099,139 | 59,042,633 | 99,964,940 | |||||||||||||||
Value of shares repurchased | (264,032,209 | ) | (99,548,000 | ) | (86,828,275 | ) | (86,977,854 | ) | |||||||||||
Net income equalization | (124,852 | ) | 71,444 | (139,588 | ) | (1,824 | ) | ||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | (64,635,722 | ) | 59,622,583 | (27,925,230 | ) | 12,985,262 | |||||||||||||
Increase (Decrease) in Net Assets | (86,829,793 | ) | 54,957,154 | (36,313,825 | ) | 21,570,342 | |||||||||||||
NET ASSETS: | |||||||||||||||||||
Beginning of year | 161,886,007 | 106,928,853 | 71,369,254 | 49,798,912 | |||||||||||||||
End of year | $ | 75,056,214 | $ | 161,886,007 | $ | 35,055,429 | $ | 71,369,254 | |||||||||||
Undistributed net investment income at end of year | $ | — | $ | — | $ | — | $ | — | |||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||
Shares sold | 11,100,000 | 8,800,000 | 3,000,000 | 5,500,000 | |||||||||||||||
Shares repurchased | (15,000,000 | ) | (5,600,000 | ) | (4,500,000 | ) | (4,700,000 | ) | |||||||||||
Shares outstanding, beginning of year | 8,500,000 | 5,300,000 | 3,500,000 | 2,700,000 | |||||||||||||||
Shares outstanding, end of year | 4,600,000 | 8,500,000 | 2,000,000 | 3,500,000 |
67
Financial Highlights
PowerShares Dynamic Banking Portfolio
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 23.68 | $ | 25.17 | |||||||
Net investment income** | 0.52 | 0.22 | |||||||||
Net realized and unrealized loss on investments | (4.22 | ) | (1.49 | ) | |||||||
Total from operations | (3.70 | ) | (1.27 | ) | |||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.41 | ) | (0.22 | ) | |||||||
Net asset value at end of period | $ | 19.57 | $ | 23.68 | |||||||
TOTAL RETURN:*** | (15.80 | )% | (5.08 | )% | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 107,648 | $ | 4,736 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.66 | % | 0.76 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.78 | % | 1.88 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 2.71 | % | 1.58 | %† | |||||||
Portfolio turnover rate †† | 111 | % | 57 | % | |||||||
Undistributed net investment loss included in price of units issued and redeemed**# | $ | (0.05 | ) | $ | (0.06 | ) |
PowerShares Dynamic Biotechnology & Genome Portfolio
Year Ended April 30, | For the Period June 23, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 19.30 | $ | 17.24 | $ | 14.71 | |||||||||
Net investment loss** | (0.11 | ) | (0.10 | ) | (0.08 | ) | |||||||||
Net realized and unrealized gain (loss) on investments | (1.42 | ) | 2.16 | 2.61 | |||||||||||
Total from operations | (1.53 | ) | 2.06 | 2.53 | |||||||||||
Net asset value at end of period | $ | 17.77 | $ | 19.30 | $ | 17.24 | |||||||||
TOTAL RETURN:*** | (7.93 | )% | 11.95 | % | 17.20 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 199,000 | $ | 258,616 | $ | 250,021 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.64 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.62 | % | 0.66 | % | 0.67 | %† | |||||||||
Net investment loss, after Waivers and/or Recapture | (0.57 | )% | (0.56 | )% | (0.55 | )%† | |||||||||
Portfolio turnover rate †† | 91 | % | 82 | % | 49 | % | |||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.01 | $ | 0.01 | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
See Notes to Financial Statements.
68
Financial Highlights (Continued)
PowerShares Dynamic Building & Construction Portfolio
Year Ended April 30, | For the Period October 26, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 18.70 | $ | 18.15 | $ | 15.26 | |||||||||
Net investment income** | 0.02 | 0.02 | — | (a) | |||||||||||
Net realized and unrealized gain (loss) on investments | (1.45 | ) | 0.53 | 2.90 | |||||||||||
Total from operations | (1.43 | ) | 0.55 | 2.90 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.02 | ) | — | (a) | (0.01 | ) | |||||||||
Net asset value at end of period | $ | 17.25 | $ | 18.70 | $ | 18.15 | |||||||||
TOTAL RETURN:*** | (7.66 | )% | 3.06 | % | 18.99 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 15,523 | $ | 18,699 | $ | 25,406 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.67 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 1.18 | % | 1.65 | % | 0.80 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 0.09 | % | 0.15 | % | — | †(a) | |||||||||
Portfolio turnover rate †† | 75 | % | 59 | % | 29 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.02 | ) | $ | 0.01 | — |
PowerShares Dynamic Energy Exploration & Production Portfolio
Year Ended April 30, | For the Period October 26, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 21.29 | $ | 18.63 | $ | 16.03 | |||||||||
Net investment income** | 0.05 | 0.09 | — | (a) | |||||||||||
Net realized and unrealized gain on investments | 5.41 | 2.63 | 2.62 | ||||||||||||
Total from operations | 5.46 | 2.72 | 2.62 | ||||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.06 | ) | (0.06 | ) | (0.02 | ) | |||||||||
Tax return of capital | — | (a) | — | — | |||||||||||
Total distributions | (0.06 | ) | (0.06 | ) | (0.02 | ) | |||||||||
Net asset value at end of period | $ | 26.69 | $ | 21.29 | $ | 18.63 | |||||||||
TOTAL RETURN:*** | 25.69 | % | 14.66 | % | 16.33 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 138,802 | $ | 123,488 | $ | 111,795 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.66 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.65 | % | 0.74 | % | 0.75 | %† | |||||||||
Net investment income (loss), after Waivers and/or Recapture | 0.23 | % | 0.47 | % | (0.01 | )%† | |||||||||
Portfolio turnover rate †† | 39 | % | 59 | % | 19 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | — | (a) | $ | (0.01 | ) | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005 or 0.005%.
See Notes to Financial Statements.
69
Financial Highlights (Continued)
PowerShares Dynamic Food & Beverage Portfolio
Year Ended April 30, | For the Period June 23, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 17.53 | $ | 15.17 | $ | 14.85 | |||||||||
Net investment income** | 0.18 | 0.39 | 0.11 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (0.42 | ) | 2.14 | 0.30 | |||||||||||
Total from operations | (0.24 | ) | 2.53 | 0.41 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.40 | ) | (0.17 | ) | (0.09 | ) | |||||||||
Return of capital | (0.16 | ) | — | — | |||||||||||
Total distributions | (0.56 | ) | (0.17 | ) | (0.09 | ) | |||||||||
Net asset value at end of period | $ | 16.73 | $ | 17.53 | $ | 15.17 | |||||||||
TOTAL RETURN:*** | (1.40 | )% | 16.79 | % | 2.78 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 87,013 | $ | 33,314 | $ | 24,270 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.64 | % | 0.69 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.88 | % | 1.15 | % | 1.07 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 1.11 | % | 2.42 | % | 0.91 | %† | |||||||||
Portfolio turnover rate †† | 64 | % | 50 | % | 72 | % | |||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.07 | $ | 0.02 | — |
PowerShares Dynamic Hardware & Consumer Electronics Portfolio
Year Ended April 30, | For the Period December 6, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 17.89 | $ | 16.76 | $ | 15.30 | |||||||||
Net investment loss** | (0.06 | ) | (0.08 | ) | (0.03 | ) | |||||||||
Net realized and unrealized gain (loss) on investments | (2.56 | ) | 1.21 | 1.49 | |||||||||||
Total from operations | (2.62 | ) | 1.13 | 1.46 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Return of capital | (0.34 | ) | — | — | |||||||||||
Net asset value at end of period | $ | 14.93 | $ | 17.89 | $ | 16.76 | |||||||||
TOTAL RETURN:*** | (15.00 | )% | 6.74 | % | 9.54 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 5,971 | $ | 12,520 | $ | 16,764 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.72 | % | 0.68 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 1.47 | % | 1.96 | % | 1.03 | %† | |||||||||
Net investment loss, after Waivers and/or Recapture | (0.32 | )% | (0.48 | )% | (0.48 | )%† | |||||||||
Portfolio turnover rate †† | 43 | % | 52 | % | 14 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.07 | ) | $ | 0.02 | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
See Notes to Financial Statements.
70
Financial Highlights (Continued)
PowerShares Dynamic Healthcare Services Portfolio
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 28.04 | $ | 24.88 | |||||||
Net investment loss** | (0.16 | ) | (0.08 | ) | |||||||
Net realized and unrealized gain (loss) on investments | (4.53 | ) | 3.24 | ||||||||
Total from operations | (4.69 | ) | 3.16 | ||||||||
Net asset value at end of period | $ | 23.35 | $ | 28.04 | |||||||
TOTAL RETURN:*** | (16.73 | )% | 12.70 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 28,026 | $ | 28,041 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.67 | % | 0.70 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.80 | % | 1.20 | %† | |||||||
Net investment loss, after Waivers and/or Recapture | (0.54 | )% | (0.56 | )%† | |||||||
Portfolio turnover rate †† | 63 | % | 13 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | 0.04 | $ | (0.04 | ) |
PowerShares Dynamic Insurance Portfolio
Year Ended April 30, | For the Period October 26, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 18.84 | $ | 17.31 | $ | 15.44 | |||||||||
Net investment income** | 0.27 | ††† | 0.15 | 0.07 | |||||||||||
Net realized and unrealized gain (loss) on investments | (2.61 | ) | 1.51 | 1.86 | |||||||||||
Total from operations | (2.34 | ) | 1.66 | 1.93 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.30 | ) | (0.13 | ) | (0.06 | ) | |||||||||
Net asset value at end of period | $ | 16.20 | $ | 18.84 | $ | 17.31 | |||||||||
TOTAL RETURN:*** | (12.56 | )% | 9.62 | % | 12.54 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 34,012 | $ | 58,401 | $ | 31,164 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.68 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.82 | % | 0.96 | % | 0.87 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 1.54 | %††† | 0.87 | % | 0.81 | %† | |||||||||
Portfolio turnover rate †† | 82 | % | 40 | % | 30 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.03 | ) | $ | 0.01 | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
††† Net investment income per share and the ratio of net investment income to average net assets include a special cash dividend received of $2.00 per share owned of Progressive Corp. (The) on September 14, 2007. Net investment income per share and the ratio of net investment income to average net assets excluding the special dividend are $0.17 and 0.96%, respectively.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
See Notes to Financial Statements.
71
Financial Highlights (Continued)
PowerShares Dynamic Leisure and Entertainment Portfolio
Year Ended April 30, | For the Period June 23, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 18.32 | $ | 16.29 | $ | 14.77 | |||||||||
Net investment income** | 0.12 | 0.07 | 0.03 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (2.75 | ) | 2.05 | 1.51 | |||||||||||
Total from operations | (2.63 | ) | 2.12 | 1.54 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.19 | ) | (0.08 | ) | (0.02 | ) | |||||||||
Return of capital | (0.39 | ) | (0.01 | ) | — | ||||||||||
Total distributions | (0.58 | ) | (0.09 | ) | (0.02 | ) | |||||||||
Net asset value at end of period | $ | 15.11 | $ | 18.32 | $ | 16.29 | |||||||||
TOTAL RETURN:*** | (14.58 | )% | 13.02 | % | 10.41 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 15,115 | $ | 49,472 | $ | 27,701 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.64 | % | 0.68 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.95 | % | 1.07 | % | 1.03 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 0.70 | % | 0.42 | % | 0.22 | %† | |||||||||
Portfolio turnover rate †† | 58 | % | 35 | % | 48 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.16 | ) | $ | 0.01 | — |
PowerShares Dynamic Media Portfolio
Year Ended April 30, | For the Period June 23, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 16.48 | $ | 14.44 | $ | 14.93 | |||||||||
Net investment income** | 0.06 | 0.04 | 0.02 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (2.82 | ) | 2.04 | (0.49 | ) | ||||||||||
Total from operations | (2.76 | ) | 2.08 | (0.47 | ) | ||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.06 | ) | (0.04 | ) | (0.02 | ) | |||||||||
Return of capital | (0.22 | ) | — | — | |||||||||||
Total distributions | (0.28 | ) | (0.04 | ) | (0.02 | ) | |||||||||
Net asset value at end of period | $ | 13.44 | $ | 16.48 | $ | 14.44 | |||||||||
TOTAL RETURN:*** | (16.91 | )% | 14.42 | % | (3.15 | )% | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 30,923 | $ | 31,305 | $ | 24,543 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.64 | % | 0.68 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.85 | % | 1.24 | % | 1.04 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 0.36 | % | 0.25 | % | 0.19 | %† | |||||||||
Portfolio turnover rate †† | 62 | % | 43 | % | 68 | % | |||||||||
Undistributed net investment loss included in price of units issued and redeemed**# | $ | (0.04 | ) | $ | (0.01 | ) | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
See Notes to Financial Statements.
72
Financial Highlights (Continued)
PowerShares Dynamic Networking Portfolio
Year Ended April 30, | For the Period June 23, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 18.68 | $ | 17.38 | $ | 14.96 | |||||||||
Net investment loss** | (0.09 | ) | (0.09 | ) | (0.08 | ) | |||||||||
Net realized and unrealized gain (loss) on investments | (2.55 | ) | 1.39 | 2.50 | |||||||||||
Total from operations | (2.64 | ) | 1.30 | 2.42 | |||||||||||
Net asset value at end of period | $ | 16.04 | $ | 18.68 | $ | 17.38 | |||||||||
TOTAL RETURN:*** | (14.13 | )% | 7.48 | % | 16.18 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 12,831 | $ | 18,677 | $ | 27,806 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.64 | % | 0.68 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 1.25 | % | 1.24 | % | 1.03 | %† | |||||||||
Net investment loss, after Waivers and/or Recapture | (0.51 | )% | (0.54 | )% | (0.59 | )%† | |||||||||
Portfolio turnover rate †† | 17 | % | 62 | % | 42 | % | |||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.01 | $ | 0.03 | — |
PowerShares Dynamic Oil & Gas Services Portfolio
Year Ended April 30, | For the Period October 26, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 22.70 | $ | 21.41 | $ | 16.43 | |||||||||
Net investment income (loss)** | (0.02 | ) | — | (a) | (0.01 | ) | |||||||||
Net realized and unrealized gain on investments | 6.55 | 1.29 | 4.99 | ||||||||||||
Total from operations | 6.53 | 1.29 | 4.98 | ||||||||||||
Net asset value at end of period | $ | 29.23 | $ | 22.70 | $ | 21.41 | |||||||||
TOTAL RETURN:*** | 28.77 | % | 6.03 | % | 30.31 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 379,939 | $ | 272,456 | $ | 336,132 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.62 | % | 0.63 | % | 0.64 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.60 | % | 0.65 | % | 0.67 | %† | |||||||||
Net investment income (loss), after Waivers and/or Recapture | (0.06 | )% | 0.02 | % | (0.10 | )%† | |||||||||
Portfolio turnover rate †† | 67 | % | 76 | % | 10 | % | |||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | — | (a) | $ | — | (a) | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
73
Financial Highlights (Continued)
PowerShares Dynamic Pharmaceuticals Portfolio
Year Ended April 30, | For the Period June 23, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 19.61 | $ | 16.54 | $ | 14.84 | |||||||||
Net investment income** | 0.10 | 0.08 | 0.06 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (2.45 | ) | 3.08 | 1.68 | |||||||||||
Total from operations | (2.35 | ) | 3.16 | 1.74 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.06 | ) | (0.08 | ) | (0.04 | ) | |||||||||
Return of capital | — | (0.01 | ) | — | |||||||||||
Total distributions | (0.06 | ) | (0.09 | ) | (0.04 | ) | |||||||||
Net asset value at end of period | $ | 17.20 | $ | 19.61 | $ | 16.54 | |||||||||
TOTAL RETURN:*** | (11.99 | )% | 19.20 | % | 11.74 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 106,615 | $ | 82,345 | $ | 66,157 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.66 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.69 | % | 0.80 | % | 0.88 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 0.52 | % | 0.43 | % | 0.42 | %† | |||||||||
Portfolio turnover rate †† | 45 | % | 29 | % | 29 | % | |||||||||
Undistributed net investment loss included in price of units issued and redeemed**# | $ | (0.01 | ) | $ | (0.01 | ) | — |
PowerShares Dynamic Retail Portfolio
Year Ended April 30, | For the Period October 26, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 20.02 | $ | 18.29 | $ | 15.13 | |||||||||
Net investment income** | 0.04 | 0.07 | 0.01 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (3.92 | ) | 1.71 | 3.16 | |||||||||||
Total from operations | (3.88 | ) | 1.78 | 3.17 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.10 | ) | (0.05 | ) | (0.01 | ) | |||||||||
Return of capital | (0.05 | ) | — | — | |||||||||||
Total distributions | (0.15 | ) | (0.05 | ) | (0.01 | ) | |||||||||
Net asset value at end of period | $ | 15.99 | $ | 20.02 | $ | 18.29 | |||||||||
TOTAL RETURN:*** | (19.41 | )% | 9.72 | % | 20.98 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 14,391 | $ | 24,029 | $ | 23,783 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.64 | % | 0.70 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 1.46 | % | 1.41 | % | 0.97 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 0.22 | % | 0.35 | % | 0.17 | %† | |||||||||
Portfolio turnover rate †† | 198 | % | 73 | % | 11 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.07 | ) | $ | — | (a) | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
74
Financial Highlights (Continued)
PowerShares Dynamic Semiconductors Portfolio
Year Ended April 30, | For the Period June 23, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 19.05 | $ | 20.18 | $ | 14.93 | |||||||||
Net investment loss** | (0.01 | ) | (0.04 | ) | (0.05 | ) | |||||||||
Net realized and unrealized gain (loss) on investments | (2.72 | ) | (1.09 | ) | 5.30 | ||||||||||
Total from operations | (2.73 | ) | (1.13 | ) | 5.25 | ||||||||||
Net asset value at end of period | $ | 16.32 | $ | 19.05 | $ | 20.18 | |||||||||
TOTAL RETURN:*** | (14.33 | )% | (5.60 | )% | 35.16 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 75,056 | $ | 161,886 | $ | 106,929 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.65 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.67 | % | 0.78 | % | 0.75 | %† | |||||||||
Net investment loss, after Waivers and/or Recapture | (0.04 | )% | (0.23 | )% | (0.33 | )%† | |||||||||
Portfolio turnover rate †† | 56 | % | 51 | % | 42 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | 0.02 | $ | (0.01 | ) | — |
PowerShares Dynamic Software Portfolio
Year Ended April 30, | For the Period June 23, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 20.39 | $ | 18.44 | $ | 14.98 | |||||||||
Net investment loss** | (0.10 | ) | (0.10 | ) | (0.08 | ) | |||||||||
Net realized and unrealized gain (loss) on investments | (2.76 | ) | 2.05 | 3.54 | |||||||||||
Total from operations | (2.86 | ) | 1.95 | 3.46 | |||||||||||
Net asset value at end of period | $ | 17.53 | $ | 20.39 | $ | 18.44 | |||||||||
TOTAL RETURN:*** | (14.03 | )% | 10.57 | % | 23.10 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 35,055 | $ | 71,369 | $ | 49,799 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.67 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.78 | % | 0.83 | % | 0.91 | %† | |||||||||
Net investment loss, after Waivers and/or Recapture | (0.49 | )% | (0.51 | )% | (0.53 | )%† | |||||||||
Portfolio turnover rate †† | 64 | % | 59 | % | 75 | % | |||||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.05 | $ | — | (a) | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
75
Notes to Financial Statements
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the "Trust") was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company, registered under the Investment Company Act of 1940, as amended (the "1940 Act"). As of period end, the Trust offers seventy-three portfolios. This report includes the following portfolios:
PowerShares Dynamic Banking Portfolio | "Dynamic Banking Portfolio" | ||||||
PowerShares Dynamic Biotechnology & Genome Portfolio | "Dynamic Biotechnology & Genome Portfolio" | ||||||
PowerShares Dynamic Building & Construction Portfolio | "Dynamic Building & Construction Portfolio" | ||||||
PowerShares Dynamic Energy Exploration & Production Portfolio | "Dynamic Energy Exploration & Production Portfolio" | ||||||
PowerShares Dynamic Food & Beverage Portfolio | "Dynamic Food & Beverage Portfolio" | ||||||
PowerShares Dynamic Hardware & Consumer Electronics Portfolio | "Dynamic Hardware & Consumer Electronics Portfolio" | ||||||
PowerShares Dynamic Healthcare Services Portfolio | "Dynamic Healthcare Services Portfolio" | ||||||
PowerShares Dynamic Insurance Portfolio | "Dynamic Insurance Portfolio" | ||||||
PowerShares Dynamic Leisure and Entertainment Portfolio | "Dynamic Leisure and Entertainment Portfolio" | ||||||
PowerShares Dynamic Media Portfolio | "Dynamic Media Portfolio" | ||||||
PowerShares Dynamic Networking Portfolio | "Dynamic Networking Portfolio" | ||||||
PowerShares Dynamic Oil & Gas Services Portfolio | "Dynamic Oil & Gas Services Portfolio" | ||||||
PowerShares Dynamic Pharmaceuticals Portfolio | "Dynamic Pharmaceuticals Portfolio" | ||||||
PowerShares Dynamic Retail Portfolio | "Dynamic Retail Portfolio" | ||||||
PowerShares Dynamic Semiconductors Portfolio | "Dynamic Semiconductors Portfolio" | ||||||
PowerShares Dynamic Software Portfolio | "Dynamic Software Portfolio" | ||||||
Each portfolio (the "Fund" or collectively the "Funds") represents a separate series of the Trust. The shares of the Funds are referred to herein as "Shares" or "Fund Shares." Each Fund's shares are listed and traded on the American Stock Exchange.
The Funds' market prices may differ to some degree from the net asset value of the shares of each Fund. Unlike conventional mutual funds, each Fund issues and redeems shares on a continuous basis, at net asset value, only in a large specified number of shares, each called a "Creation Unit." Creation Units are issued and redeemed generally in-kind for securities included in the relevant index. Except when aggregated in Creation Units shares are not individually redeemable securities of the Funds. The investment objective of each Fund is to seek investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of the following equity indices:
Fund | Index | ||||||
Dynamic Banking Portfolio | Dynamic Banking IntellidexSM Index | ||||||
Dynamic Biotechnology & Genome Portfolio | Dynamic Biotechnology & Genome IntellidexSM Index | ||||||
Dynamic Building & Construction Portfolio | Dynamic Building & Construction IntellidexSM Index | ||||||
76
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Fund | Index | ||||||
Dynamic Energy Exploration & Production Portfolio | Dynamic Energy Exploration & Production IntellidexSM Index | ||||||
Dynamic Food & Beverage Portfolio | Dynamic Food & Beverage IntellidexSM Index | ||||||
Dynamic Hardware & Consumer Electronics Portfolio | Dynamic Hardware & Consumer Electronics IntellidexSM Index | ||||||
Dynamic Healthcare Services Portfolio | Dynamic Healthcare Services IntellidexSM Index | ||||||
Dynamic Insurance Portfolio | Dynamic Insurance IntellidexSM Index | ||||||
Dynamic Leisure and Entertainment Portfolio | Dynamic Leisure and Entertainment IntellidexSM Index | ||||||
Dynamic Media Portfolio | Dynamic Media IntellidexSM Index | ||||||
Dynamic Networking Portfolio | Dynamic Networking IntellidexSM Index | ||||||
Dynamic Oil & Gas Services Portfolio | Dynamic Oil Services IntellidexSM Index | ||||||
Dynamic Pharmaceuticals Portfolio | Dynamic Pharmaceuticals IntellidexSM Index | ||||||
Dynamic Retail Portfolio | Dynamic Retail IntellidexSM Index | ||||||
Dynamic Semiconductors Portfolio | Dynamic Semiconductors IntellidexSM Index | ||||||
Dynamic Software Portfolio | Dynamic Software IntellidexSM Index | ||||||
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates.
A. Security Valuation
Securities, including restricted securities, are valued according to the following policy.
A security listed or traded on an exchange (except convertible bonds) 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. Listed options if no closing price is available are valued at the mean between the last bid and the ask 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 ask prices.
Investments in open-end registered investment companies are valued at the end of day net asset value per share.
Debt obligations (including convertible bonds) 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, yield, quality, type of issue, coupon rate, maturity, individual trading characteristics and other market data. Short-term obligations, including commercial paper, having 60 days or less to maturity are recorded at amortized cost which approximates value. Debt securities are subject to interest rate and credit risks. In addition, all debt securities involve some risk of default with respect to interest and/or principal payments.
77
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Foreign securities (including foreign exchange contracts) are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. 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 are significant and may 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 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, ADRs 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.
Securities for which market quotations are not readily available or are 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/ask 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.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer's assets, general economic conditions, interest rates, investor perceptions and market liquidity.
B. Other Risk
The Funds may concentrate investments in a comparatively narrow segment of the economy. Consequently, such Fund may tend to be more volatile than other funds, and the value of investments may tend to rise and fall more rapidly.
When investing in securities of a limited number of companies, each investment has a greater effect on the Fund's overall performance, and any change in the value of those securities could significantly affect the value of your investment in the Fund.
C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and will distribute substantially all of the Fund's taxable earnings to its shareholders. As such, the Funds will not be subject to Federal income taxes on otherwise taxable income
78
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
(including net realized gains) that is distributed to the shareholders. Therefore, no provision for Federal income taxes is included.
Income and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from accounting principles generally accepted in the United States. These differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and Passive Foreign Investment Company adjustments, if any.
The Funds file tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
D. Investment Income and Investment Transactions
Dividend income is recorded on the ex-dividend date net of foreign taxes withheld, if any. Interest income is recorded on the accrual basis. Investment transactions are recorded on the trade date. Realized gains and losses from the sale or disposition of securities are calculated on the specific identified cost basis. Dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
E. Expenses
Expenses of the Trust, which are directly identifiable to a specific Fund, are applied to that Fund. Expenses which are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, any distribution fees or expenses and extraordinary expenses.
F. Dividends and Distributions to Shareholders
Each Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and distributes net realized taxable capital gains, if any, annually in cash. Such distributions on a tax basis are determined in conformity with income tax regulations which may differ from accounting principles generally accepted in the United States of America. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund's financial statements as a tax return of capital at fiscal period end.
G. Equalization
All Funds use the accounting practice of equalization. This accounting method is used to keep the continuing shareholder's per share equity in undistributed net investment income from being affected by the continuous sales and redemptions of capital shares. Equalization is calculated on a per share basis whereby a portion of the proceeds from the sales and cost of repurchases of capital shares is applied to undistributed net investment income. The amount of equalization is disclosed in the Statements of Changes in Net Assets as undistributed net investment income included in the price of capital shares issued or redeemed. The distributions to shareholders of amounts so applied may be deemed to be a return of capital for tax purposes to the extent that such distributions exceed taxable income.
79
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with the Invesco PowerShares Capital Management LLC ("the Adviser") (formerly PowerShares Capital Management LLC) such that the Adviser has overall responsibility as the Funds' investment adviser for the selection and ongoing monitoring of the Funds' investments, managing the Funds' business affairs and providing certain clerical, bookkeeping and other administrative services. Each Fund has agreed to pay an annual fee of 0.50% of the Fund's average daily net assets.
The Adviser has entered into an Amended and Restated Excess Expense Agreement ("Excess Expense Agreement") with the Trust, the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses of the Funds (excluding interest expense, brokerage commissions and other trading expenses, sub-licensing fees, offering costs, taxes and extraordinary expenses) from exceeding 0.60% of average daily net assets per year (the "Expense Cap"), at least until August 31, 2009. Offering costs excluded from the Expense Cap are: (a) legal fees pertaining to the Funds' shares offered for sale; (b) Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange.
The Trust and the Adviser have entered into an Excess Expense Agreement (the "Recapture Agreement") in which expenses borne by the Adviser are subject to recapture by the Adviser for up to three years from the date the fee or expense was borne by the Adviser, but no recapture payment will be made by each Fund if it would result in each Fund exceeding its Expense Cap as specified above.
The net amount of fees waived and other expenses assumed by the Adviser and the amount of recapture paid to the Adviser pursuant to the Excess Expense Agreement are collectively referred to as 'Waivers and/or Recapture'.
During the year ended April 30, 2008, the amount of 'Waivers and/or Recapture' was as follows:
(Waivers) and/or Recapture | |||||||
Dynamic Banking Portfolio | $ | (74,802 | ) | ||||
Dynamic Biotechnology & Genome Portfolio | 17,336 | ||||||
Dynamic Building & Construction Portfolio | (116,382 | ) | |||||
Dynamic Energy Exploration & Production Portfolio | (27,558 | ) | |||||
Dynamic Food & Beverage Portfolio | (104,686 | ) | |||||
Dynamic Hardware & Consumer Electronics Portfolio | (114,521 | ) | |||||
Dynamic Healthcare Services Portfolio | (68,092 | ) | |||||
Dynamic Insurance Portfolio | (93,139 | ) | |||||
Dynamic Leisure and Entertainment Portfolio | (107,914 | ) | |||||
Dynamic Media Portfolio | (97,999 | ) | |||||
Dynamic Networking Portfolio | (117,609 | ) | |||||
Dynamic Oil & Gas Services Portfolio | 59,480 | ||||||
Dynamic Pharmaceuticals Portfolio | (60,852 | ) | |||||
Dynamic Retail Portfolio | (118,124 | ) | |||||
Dynamic Semiconductors Portfolio | (47,309 | ) | |||||
Dynamic Software Portfolio | (86,270 | ) |
The net amounts of Waivers and/or Recapture are also shown on the Statements of Operations.
80
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
The amounts available for potential future recapture by the Adviser under the Excess Expense Agreement and the expiration schedule at April 30, 2008 are as follows:
Total Potential Recapture | Potential Recapture Amounts Expiring | ||||||||||||||||||
Amount | 04/30/09 | 04/30/10 | 04/30/11 | ||||||||||||||||
Dynamic Banking Portfolio | $ | 123,784 | $ | — | $ | 48,981 | $ | 74,803 | |||||||||||
Dynamic Biotechnology & Genome Portfolio | 107,572 | 3,246 | 80,436 | 23,890 | |||||||||||||||
Dynamic Building & Construction Portfolio | 298,148 | 26,551 | 153,869 | 117,728 | |||||||||||||||
Dynamic Energy Exploration & Production Portfolio | 176,507 | 25,668 | 117,014 | 33,825 | |||||||||||||||
Dynamic Food & Beverage Portfolio | 329,059 | 75,579 | 147,423 | 106,057 | |||||||||||||||
Dynamic Hardware & Consumer Electronics Portfolio | 299,812 | 32,253 | 151,713 | 115,846 | |||||||||||||||
Dynamic Healthcare Services Portfolio | 115,615 | — | 41,828 | 73,787 | |||||||||||||||
Dynamic Insurance Portfolio | 264,375 | 29,018 | 140,805 | 94,552 | |||||||||||||||
Dynamic Leisure and Entertainment Portfolio | 327,842 | 72,283 | 146,252 | 109,307 | |||||||||||||||
Dynamic Media Portfolio | 323,105 | 74,102 | 149,640 | 99,363 | |||||||||||||||
Dynamic Networking Portfolio | 342,092 | 74,548 | 148,592 | 118,952 | |||||||||||||||
Dynamic Oil & Gas Services Portfolio | 24,216 | — | — | 24,216 | |||||||||||||||
Dynamic Pharmaceuticals Portfolio | 264,372 | 70,406 | 131,335 | 62,631 | |||||||||||||||
Dynamic Retail Portfolio | 305,577 | 33,950 | 152,165 | 119,462 | |||||||||||||||
Dynamic Semiconductors Portfolio | 237,160 | 55,551 | 126,497 | 55,112 | |||||||||||||||
Dynamic Software Portfolio | 292,386 | 67,488 | 132,710 | 92,188 |
Distribution Agreement
The Trust has entered into a Distribution Agreement with Invesco Aim Distributors, Inc. (formerly A I M Distributors, Inc.) (the "Distributor") which serves as the Distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in Shares.
Licensing Fee Agreements
The Adviser has entered into a licensing agreement for each Fund with the American Stock Exchange ("Licensor"). The trademarks are owned by the respective Licensor.
The above trademarks are owned by the respective Licensor. This trademark has been licensed to the Adviser for use with the Funds. The Funds are not sponsored, endorsed, sold or promoted by the Licensor and the Licensor makes no representation regarding the advisability of investing in any of these Funds. The Funds are required to pay the sub-licensing fees which are shown on the Statements of Operations.
The Bank of New York, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian and fund accounting and transfer agent for each Fund.
The custodian has agreed to provide overdraft protection to the Funds according to the terms of the service agreement.
Note 4. Federal Income Tax
At April 30, 2008, costs of investments on a tax basis including the adjustments for financial reporting purposes as of the most recently completed Federal income tax reporting year were as follows:
81
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Dynamic Banking Portfolio | $ | 106,154,016 | |||||
Dynamic Biotechnology & Genome Portfolio | 198,855,867 | ||||||
Dynamic Building & Construction Portfolio | 16,066,293 | ||||||
Dynamic Energy Exploration & Production Portfolio | 116,038,869 | ||||||
Dynamic Food & Beverage Portfolio | 85,391,662 | ||||||
Dynamic Hardware & Consumer Electronics Portfolio | 7,424,686 | ||||||
Dynamic Healthcare Services Portfolio | 35,988,738 | ||||||
Dynamic Insurance Portfolio | 35,077,558 | ||||||
Dynamic Leisure and Entertainment Portfolio | 16,810,074 | ||||||
Dynamic Media Portfolio | 34,642,406 | ||||||
Dynamic Networking Portfolio | 14,383,851 | ||||||
Dynamic Oil & Gas Services Portfolio | 322,842,422 | ||||||
Dynamic Pharmaceuticals Portfolio | 118,223,134 | ||||||
Dynamic Retail Portfolio | 14,447,809 | ||||||
Dynamic Semiconductors Portfolio | 84,190,798 | ||||||
Dynamic Software Portfolio | 35,951,472 |
At April 30, 2008, the components of accumulated earnings/loss on a tax-basis were as follows:
Accumulated Earnings | Net Accumulated Capital and other Gains/Losses | Unrealized Appreciation/ Depreciation | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Total Accumulated Earnings/Loss | ||||||||||||||||||||||
Dynamic Banking Portfolio | $ | 1,009,971 | $ | (1,146,630 | ) | $ | 1,788,382 | $ | 6,296,865 | $ | (4,508,483 | ) | $ | 1,651,723 | |||||||||||||
Dynamic Biotechnology & Genome Portfolio | — | (35,751,975 | ) | 458,255 | 18,714,813 | (18,256,558 | ) | (35,293,720 | ) | ||||||||||||||||||
Dynamic Building & Construction Portfolio | 19,258 | (3,006,075 | ) | (564,652 | ) | 601,581 | (1,166,233 | ) | (3,551,469 | ) | |||||||||||||||||
Dynamic Energy Exploration & Production Portfolio | — | (3,517,832 | ) | 22,803,222 | 28,124,996 | (5,321,774 | ) | 19,285,390 | |||||||||||||||||||
Dynamic Food & Beverage Portfolio | — | (3,659,313 | ) | 1,780,762 | 3,573,463 | (1,792,701 | ) | (1,878,551 | ) | ||||||||||||||||||
Dynamic Hardware & Consumer Electronics Portfolio | — | (1,775,460 | ) | (1,464,767 | ) | 77,295 | (1,542,062 | ) | (3,240,227 | ) | |||||||||||||||||
Dynamic Healthcare Services Portfolio | — | (1,525,186 | ) | (7,955,637 | ) | 86,753 | (8,042,390 | ) | (9,480,823 | ) | |||||||||||||||||
Dynamic Insurance Portfolio | 41,414 | (2,956,045 | ) | (1,110,372 | ) | 1,084,982 | (2,195,354 | ) | (4,025,003 | ) | |||||||||||||||||
Dynamic Leisure and Entertainment Portfolio | — | (4,475,548 | ) | (1,565,978 | ) | 410,479 | (1,976,457 | ) | (6,041,526 | ) | |||||||||||||||||
Dynamic Media Portfolio | — | (6,238,146 | ) | (3,539,522 | ) | 1,381,731 | (4,921,253 | ) | (9,777,668 | ) | |||||||||||||||||
Dynamic Networking Portfolio | — | (3,386,903 | ) | (1,541,074 | ) | 311,755 | (1,852,829 | ) | (4,927,977 | ) | |||||||||||||||||
Dynamic Oil & Gas Services Portfolio | 45,350 | (22,936,464 | ) | 56,665,026 | 60,092,533 | (3,427,507 | ) | 33,773,912 | |||||||||||||||||||
Dynamic Pharmaceuticals Portfolio | 202,994 | (2,603,817 | ) | (11,502,096 | ) | 5,325,239 | (16,827,335 | ) | (13,902,919 | ) | |||||||||||||||||
Dynamic Retail Portfolio | — | (2,846,037 | ) | 63,780 | 936,008 | (872,228 | ) | (2,782,257 | ) | ||||||||||||||||||
Dynamic Semiconductors Portfolio | — | (19,626,835 | ) | (9,162,683 | ) | 2,011,871 | (11,174,554 | ) | (28,789,518 | ) | |||||||||||||||||
Dynamic Software Portfolio | — | (4,667,895 | ) | (956,670 | ) | 1,656,658 | (2,613,328 | ) | (5,624,565 | ) |
82
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Distributions to Shareholders:
The tax character of distributions paid was as follows:
Year Ended April 30, 2008 | Period Ended April 30, 2007 | ||||||||||
Distributions paid from Ordinary Income | Distributions paid from Ordinary Income | ||||||||||
Dynamic Banking Portfolio | $ | 684,636 | $ | 44,552 | |||||||
Dynamic Building & Construction Portfolio | 18,567 | 4,191 | |||||||||
Dynamic Energy Exploration & Production Portfolio | 387,353 | 351,098 | |||||||||
Dynamic Food & Beverage Portfolio | 889,330 | 306,737 | |||||||||
Dynamic Insurance Portfolio | 785,432 | 333,066 | |||||||||
Dynamic Leisure and Entertainment Portfolio | 237,929 | 158,121 | |||||||||
Dynamic Media Portfolio | 173,173 | 58,259 | |||||||||
Dynamic Pharmaceuticals Portfolio | 339,784 | 367,491 | |||||||||
Dynamic Retail Portfolio | 53,516 | 54,224 | |||||||||
Year Ended April 30, 2008 | Period Ended April 30, 2007 | ||||||||||
Distributions paid from Return of Capital | Distributions paid from Return of Capital | ||||||||||
Dynamic Energy Exploration & Production Portfolio | $ | 12,322 | $ | — | |||||||
Dynamic Food & Beverage Portfolio | 369,392 | — | |||||||||
Dynamic Hardware & Consumer Electronics Portfolio | 303,093 | — | |||||||||
Dynamic Leisure and Entertainment Portfolio | 485,571 | 21,748 | |||||||||
Dynamic Media Portfolio | 655,987 | — | |||||||||
Dynamic Pharmaceuticals Portfolio | — | 27,281 | |||||||||
Dynamic Retail Portfolio | 28,135 | — |
At April 30, 2008, for Federal income tax purposes, the Funds have capital loss carryforwards available as shown in the table below, to the extent provided by the regulations, to offset future capital gains through the years indicated. To the extent that these loss carryforwards are used to offset future capital gains, it is probable that the capital gains so offset will not be distributed to shareholders. The use of some portion of the capital loss carryforwards by any one fund may be limited by federal tax rules. These rules limit the use of the carryforwards when there has been a greater than fifty percent change in ownership of a fund.
Year of Expiration | Total | ||||||||||||||||||||||
2013 | 2014 | 2015 | 2016 | Amount | |||||||||||||||||||
Dynamic Banking Portfolio | $ | — | $ | — | $ | — | $ | 1,146,630 | $ | 1,146,630 | |||||||||||||
Dynamic Biotechnology & Genome Portfolio | — | 321,497 | 19,612,223 | 15,818,255 | 35,751,975 | ||||||||||||||||||
Dynamic Building & Construction Portfolio | — | — | 2,263,182 | 742,893 | 3,006,075 | ||||||||||||||||||
Dynamic Energy Exploration & Production Portfolio | — | — | 285,311 | 3,232,521 | 3,517,832 | ||||||||||||||||||
Dynamic Food & Beverage Portfolio | — | 433,620 | 1,965,652 | 1,260,041 | 3,659,313 |
83
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Year of Expiration | Total | ||||||||||||||||||||||
2013 | 2014 | 2015 | 2016 | Amount | |||||||||||||||||||
Dynamic Hardware & Consumer Electronics Portfolio | $ | — | $ | — | $ | 1,413,579 | $ | 361,881 | $ | 1,775,460 | |||||||||||||
Dynamic Healthcare Services Portfolio | — | — | — | 1,525,186 | 1,525,186 | ||||||||||||||||||
Dynamic Insurance Portfolio | — | — | 774,301 | 2,181,744 | 2,956,045 | ||||||||||||||||||
Dynamic Leisure and Entertainment Portfolio | — | 751,908 | 1,611,839 | 2,111,801 | 4,755,548 | ||||||||||||||||||
Dynamic Media Portfolio | — | 545,973 | 3,187,134 | 2,505,039 | 6,238,146 | ||||||||||||||||||
Dynamic Networking Portfolio | — | 383,187 | 1,939,441 | 1,064,275 | 3,386,903 | ||||||||||||||||||
Dynamic Oil & Gas Services Portfolio | — | — | 15,026,862 | 7,909,602 | 22,936,464 | ||||||||||||||||||
Dynamic Pharmaceuticals Portfolio | 164,751 | 66,659 | 644,797 | 1,727,610 | 2,603,817 | ||||||||||||||||||
Dynamic Retail Portfolio | — | — | 937,070 | 1,908,967 | 2,846,037 | ||||||||||||||||||
Dynamic Semiconductors Portfolio | — | 271,588 | 9,158,832 | 10,196,415 | 19,626,835 | ||||||||||||||||||
Dynamic Software Portfolio | — | 108,427 | 3,017,278 | 1,542,190 | 4,667,895 |
Capital losses incurred after October 31 ("post-October losses") within the taxable year are deemed to arise on the first business day of each Fund's next taxable year.
During the year ended April 30, 2008, the Funds incurred and will elect to defer net capital losses as follows:
Post-October Losses | |||||||
Dynamic Banking Portfolio | $ | 11,809,903 | |||||
Dynamic Biotechnology & Genome Portfolio | 28,839,459 | ||||||
Dynamic Building & Construction Portfolio | 2,498,907 | ||||||
Dynamic Energy Exploration & Production Portfolio | 3,088,290 | ||||||
Dynamic Food & Beverage Portfolio | 2,270,812 | ||||||
Dynamic Hardware & Consumer Electronics Portfolio | 878,768 | ||||||
Dynamic Healthcare Services Portfolio | 1,843,500 | ||||||
Dynamic Insurance Portfolio | 3,164,170 | ||||||
Dynamic Leisure and Entertainment Portfolio | 1,990,095 | ||||||
Dynamic Media Portfolio | 2,706,697 | ||||||
Dynamic Networking Portfolio | 1,442,156 | ||||||
Dynamic Oil & Gas Services Portfolio | 14,044,524 | ||||||
Dynamic Pharmaceuticals Portfolio | 3,395,971 | ||||||
Dynamic Retail Portfolio | 1,972,254 | ||||||
Dynamic Semiconductors Portfolio | 7,162,656 | ||||||
Dynamic Software Portfolio | 4,908,814 |
In order to present shares of beneficial interest and accumulated net realized gains or losses on the Statements of Assets and Liabilities that more closely represent their tax character, certain adjustments have been made to shares of beneficial interest, undistributed net investment income or loss and net realized gains or losses on investments. These differences are primarily due to redemptions in-kind and the
84
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
tax treatment of income earned from investments in partnerships, wash sales, book equalization, and net operating losses, if any. These adjustments have no effect on net assets. For the year ended April 30, 2008, the adjustments were as follows:
Undistributed Net Investment Income (Loss) | Undistributed Capital Gains/ (Accumulated Losses) | Shares of Beneficial Interest | |||||||||||||
Dynamic Banking Portfolio | $ | 165,483 | $ | (747,317 | ) | $ | 581,834 | ||||||||
Dynamic Biotechnology & Genome Portfolio | 1,158,629 | (34,829,227 | ) | 33,670,598 | |||||||||||
Dynamic Building & Construction Portfolio | 22,619 | (2,804,965 | ) | 2,782,346 | |||||||||||
Dynamic Energy Exploration & Production Portfolio | (60,859 | ) | (25,863,031 | ) | 25,923,890 | ||||||||||
Dynamic Food & Beverage Portfolio | 198,879 | (5,947,316 | ) | 5,748,437 | |||||||||||
Dynamic Hardware & Consumer Electronics Portfolio | 393,265 | (523,094 | ) | 129,829 | |||||||||||
Dynamic Healthcare Services Portfolio | 219,356 | 10,404,055 | (10,623,411 | ) | |||||||||||
Dynamic Insurance Portfolio | 97,621 | (2,680,492 | ) | 2,582,871 | |||||||||||
Dynamic Leisure and Entertainment Portfolio | 794,735 | (2,728,762 | ) | 1,934,027 | |||||||||||
Dynamic Media Portfolio | 756,929 | 1,893,272 | (2,650,201 | ) | |||||||||||
Dynamic Networking Portfolio | 90,456 | (986,309 | ) | 895,853 | |||||||||||
Dynamic Oil & Gas Services Portfolio | 180,032 | (62,707,233 | ) | 62,527,201 | |||||||||||
Dynamic Pharmaceuticals Portfolio | 52,293 | (7,774,064 | ) | 7,721,771 | |||||||||||
Dynamic Retail Portfolio | 88,187 | (847,429 | ) | 759,242 | |||||||||||
Dynamic Semiconductors Portfolio | (74,072 | ) | (9,047,531 | ) | 9,121,603 | ||||||||||
Dynamic Software Portfolio | 141,527 | (5,241,474 | ) | 5,099,947 |
Note 5. Investment Transactions
For the year ended April 30, 2008, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, money market funds and in-kind transactions, were as follows:
Purchases | Sales | ||||||||||
Dynamic Banking Portfolio | $ | 70,473,948 | $ | 72,181,938 | |||||||
Dynamic Biotechnology & Genome Portfolio | 213,761,799 | 220,315,099 | |||||||||
Dynamic Building & Construction Portfolio | 15,535,236 | 15,645,897 | |||||||||
Dynamic Energy Exploration & Production Portfolio | 58,137,447 | 60,671,732 | |||||||||
Dynamic Food & Beverage Portfolio | 27,994,088 | 28,580,582 | |||||||||
Dynamic Hardware & Consumer Electronics Portfolio | 5,845,167 | 5,602,141 | |||||||||
Dynamic Healthcare Services Portfolio | 31,285,406 | 31,490,179 | |||||||||
Dynamic Insurance Portfolio | 40,856,323 | 41,517,599 | |||||||||
Dynamic Leisure and Entertainment Portfolio | 19,618,318 | 20,233,808 | |||||||||
Dynamic Media Portfolio | 26,852,789 | 27,564,978 | |||||||||
Dynamic Networking Portfolio | 3,143,710 | 3,871,485 | |||||||||
Dynamic Oil & Gas Services Portfolio | 259,270,060 | 251,959,556 | |||||||||
Dynamic Pharmaceuticals Portfolio | 47,064,756 | 46,647,843 | |||||||||
Dynamic Retail Portfolio | 36,776,340 | 29,153,250 | |||||||||
Dynamic Semiconductors Portfolio | 72,896,400 | 77,184,441 | |||||||||
Dynamic Software Portfolio | 36,727,851 | 38,846,436 |
85
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
For the year ended April 30, 2008, in-kind transactions were as follows:
Securities Received | Securities Delivered | ||||||||||
Dynamic Banking Portfolio | $ | 229,524,447 | $ | 114,810,310 | |||||||
Dynamic Biotechnology & Genome Portfolio | 235,817,458 | 267,518,325 | |||||||||
Dynamic Building & Construction Portfolio | 55,233,119 | 55,262,275 | |||||||||
Dynamic Energy Exploration & Production Portfolio | 149,708,314 | 161,279,153 | |||||||||
Dynamic Food & Beverage Portfolio | 113,261,093 | 59,334,439 | |||||||||
Dynamic Hardware & Consumer Electronics Portfolio | 19,133,269 | 22,645,795 | |||||||||
Dynamic Healthcare Services Portfolio | 151,475,195 | 128,628,999 | |||||||||
Dynamic Insurance Portfolio | 43,916,498 | 60,126,312 | |||||||||
Dynamic Leisure and Entertainment Portfolio | 59,894,860 | 87,156,723 | |||||||||
Dynamic Media Portfolio | 106,326,797 | 94,414,368 | |||||||||
Dynamic Networking Portfolio | 16,589,947 | 18,793,215 | |||||||||
Dynamic Oil & Gas Services Portfolio | 348,056,160 | 325,069,387 | |||||||||
Dynamic Pharmaceuticals Portfolio | 112,359,781 | 73,887,989 | |||||||||
Dynamic Retail Portfolio | 31,171,842 | 45,204,766 | |||||||||
Dynamic Semiconductors Portfolio | 201,136,723 | 261,720,043 | |||||||||
Dynamic Software Portfolio | 59,679,489 | 86,021,489 |
Gains on in-kind transactions are not considered taxable gains for Federal income tax purposes.
Note 6. Trustees' Fees
The Funds compensate each Trustee on behalf of the Trust who is not an employee of the Trust or its affiliates. Interested Trustees and Officers of the Trust do not receive any Trustees' fees.
The Trust (has adopted a deferred compensation plan (the "Plan"). Under the Plan, a trustee who is not an "interested person" (as defined in the 1940 Act) and has elected to participate in the Plan (a "participating trustee") may defer receipt of all or a portion of his compensation ("Deferral Fees"). Such Deferred Fees are deemed to be invested in selected PowerShares Funds. The Deferral Fees payable to the participating trustee is valued as of the first business dates of each calendar quarter such Fees would have been paid to the participating trustee. The value selected increases with contributions or with increases in the value of the shares selected, and the value decreases with withdrawals or with declines in the value of the shares selected.
Note 7. Capital
Shares are created and redeemed by the Trust only in Creation Unit size aggregations of 100,000. Only authorized participants are permitted to create or redeem from the Funds. Such transactions are generally permitted on an in-kind basis, with a balancing cash component to equate the transaction to the net asset value per unit of each Fund of the Trust on the transaction date. Cash may be substituted equivalent to the value of certain securities generally when they are not available in sufficient quantity for delivery, not be eligible for trading by the Authorized Participant or as a result of other market circumstances.
86
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 8. Indemnifications
Under the Trust's organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust's maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
Note 9. New Accounting Pronouncement
On September 20, 2006, the FASB released Statement of Financial Accounting Standards No. 157 "Fair Value Measurement" ("FAS 157"). FAS 157 establishes an authoritative definition of fair value, sets out a framework for measuring fair value, and requires additional disclosures about fair-value measurement. The application of FAS 157 is required for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. Management has assessed the application of FAS 157 to the Funds and has determined that the adoption of FAS 157 is not expected to have a material impact on the Funds. Management intends for the Funds to adopt FAS 157 provisions during the fiscal year ending April 30, 2009.
87
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of each of the portfolios indicated in Note 1 of the financial statements (each a portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the "Trust") at April 30, 2008, and the results of each of their operations, the changes in each of their net assets, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Trust's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2008 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
New York, New York
June 30, 2008
88
Supplemental Information
Federal Income Tax Information
The percentages of investment income (dividend income plus short-term gains, if any) qualify as follows:
Qualified dividend income | Dividends-received deduction | ||||||||||
Dynamic Banking Portfolio | 100 | % | 100 | % | |||||||
Dynamic Biotechnology & Genome Portfolio | 0 | % | 0 | % | |||||||
Dynamic Building & Construction Portfolio | 100 | % | 100 | % | |||||||
Dynamic Energy Exploration & Production Portfolio | 100 | % | 100 | % | |||||||
Dynamic Food & Beverage Portfolio | 100 | % | 100 | % | |||||||
Dynamic Hardware & Consumer Electronics Portfolio | 0 | % | 0 | % | |||||||
Dynamic Healthcare Services Portfolio | 0 | % | 0 | % | |||||||
Dynamic Insurance Portfolio | 100 | % | 100 | % | |||||||
Dynamic Leisure and Entertainment Portfolio | 100 | % | 100 | % | |||||||
Dynamic Media Portfolio | 100 | % | 100 | % | |||||||
Dynamic Networking Portfolio | 0 | % | 0 | % | |||||||
Dynamic Oil & Gas Services Portfolio | 0 | % | 0 | % | |||||||
Dynamic Pharmaceuticals Portfolio | 100 | % | 100 | % | |||||||
Dynamic Retail Portfolio | 100 | % | 100 | % | |||||||
Dynamic Semiconductors Portfolio | 0 | % | 0 | % | |||||||
Dynamic Software Portfolio | 0 | % | 0 | % |
89
Supplemental Information (Continued)
Trustees and Officers
The Trustees who are not affiliated with the Adviser or affiliates of the Adviser ("Independent Trustees") and the Trustee who is affiliated with the Adviser ("Management Trustee") and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by the Trustee, are shown below.
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Ronn R. Bagge (b. 1958) YQA Capital Management LLC 1755 S. Naperville Rd., Suite 100 Wheaton, IL 60187 | Trustee | Since 2003 | YQA Capital Management, LLC (July 1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider) | 104 | None | ||||||||||||||||||
Marc M. Kole (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | Assistant Vice President and Controller, Priority Health (September 2005-April 2008); formerly Interim CFO, Priority Health (July 2006-April 2007); formerly Senior Vice President of Finance, United Healthcare (health insurance) (July 2004-July 2005); formerly Senior Vice President of Finance, Oxford Health Plans (June 2000-July 2004) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
90
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
D. Mark McMillan (b. 1963) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Partner, Bell, Boyd & Lloyd LLP (1989-Present) | 104 | None | ||||||||||||||||||
Philip M. Nussbaum (b. 1961) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (formerly Betzold, Berg, Nussbaum & Heitman, Inc.) (November 2004-Present); formerly Managing Director, Communication Institute (May 2002- August 2003); formerly Executive Vice President of Finance, Betzold, Berg, Nussbaum & Heitman, Inc. (March 1994-1999) | 104 | None | ||||||||||||||||||
Donald H. Wilson (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | President, Chief Operating Officer and Chief Financial Officer, AMCORE Financial, Inc. (bank holding company) (August 2007-Present); formerly Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (February 2006-August 2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (May 1995- February 2006) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
91
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Management Trustee | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex*** Overseen by Trustee | Other Directorships Held by Trustee | ||||||||||||||||||
H. Bruce Bond (b.1963)** Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chairman of the Board, Trustee and Chief Executive Officer | Since 2003 | Managing Director, Invesco PowerShares Capital Management LLC (August 2002-Present); formerly Manager, Nuveen Investments (April 1998-August 2002) | 104 | None | ||||||||||||||||||
Availability of Additional Information About Funds' Trustees
The Statement of Additional Information includes additional information about the Funds' Trustees and is available, without charge, upon request at 800.337.4246.
* This is the date the Management Trustee began serving the Trust.
** Interested person as defined in Section 2(a)(19) of the 1940 Act.
*** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
92
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Officers | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | ||||||||||||
Bruce T. Duncan (b. 1954) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Financial Officer, Treasurer and Secretary | Chief Financial Officer and Treasurer Since 2006 Secretary Since 2008 | Senior Vice President of Finance, Invesco PowerShares Capital Management LLC (September 2005-Present); Private Practice Attorney (2000-2005); Vice President of Investor Relations, The ServiceMaster Company (1994-2000); Vice President of Taxes, The ServiceMaster Company (1990-2000) | ||||||||||||
Kevin R. Gustafson (b. 1965) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Compliance Officer | Since 2004 | General Counsel, Invesco PowerShares Capital Management LLC (September 2004-Present); Chief Compliance Officer, Invesco PowerShares Capital Management LLC (September 2004-April 2008); Attorney, Nyberg & Gustafson (2001-2004); Attorney, Burke, Warren, McKay & Serritella, P.C. (1997-2000) | ||||||||||||
* This is the period for which the Officers began serving the Trust. Each Officer serves a one year term, until his successor is elected.
93
Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 18, 2008, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the "Trust"), including the Independent Trustees, unanimously approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the "Adviser") and the Trust for the following 70 series (the "Funds"):
PowerShares Dynamic Market Portfolio
PowerShares Dynamic OTC Portfolio
PowerShares Golden Dragon Halter USX China Portfolio
PowerShares High Yield Equity Dividend AchieversTM Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Mid Cap Growth Portfolio
PowerShares Dynamic Mid Cap Value Portfolio
PowerShares Dynamic Small Cap Growth Portfolio
PowerShares Dynamic Small Cap Value Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Zacks Micro Cap Portfolio
PowerShares Aerospace & Defense Portfolio
PowerShares Dynamic Hardware & Consumer Electronics Portfolio
PowerShares Dynamic Telecommunications & Wireless Portfolio
PowerShares Value Line Timeliness Select Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares High Growth Rate Dividend AchieversTM Portfolio
PowerShares Zacks Small Cap Portfolio
PowerShares Dynamic Building and Construction Portfolio
PowerShares Dynamic Energy Exploration and Production Portfolio
PowerShares Dynamic Insurance Portfolio
PowerShares Dynamic Oil and Gas Services Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Utilities Portfolio
PowerShares Lux Nanotech Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares Water Resources Portfolio
PowerShares Dynamic Energy Sector Portfolio
PowerShares Dynamic Financial Sector Portfolio
PowerShares Dynamic Healthcare Sector Portfolio
PowerShares Dynamic Industrials Sector Portfolio
PowerShares Dynamic Large Cap Portfolio
PowerShares Dynamic MagniQuant Portfolio
PowerShares Dynamic Mid Cap Portfolio
PowerShares Dynamic Small Cap Portfolio
PowerShares Dynamic Technology Sector Portfolio
PowerShares Buyback Achievers(TM) Portfolio
PowerShares FTSE RAFI Basic Materials Sector Portfolio
PowerShares FTSE RAFI Consumer Goods Sector Portfolio
PowerShares FTSE RAFI Consumer Services Sector Portfolio
PowerShares FTSE RAFI Energy Sector Portfolio
PowerShares FTSE RAFI Financials Sector Portfolio
PowerShares FTSE RAFI Health Care Sector Portfolio
PowerShares FTSE RAFI Industrials Sector Portfolio
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio
94
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares FTSE RAFI Utilities Sector Portfolio
PowerShares Cleantech Portfolio
PowerShares Dynamic Aggressive Growth Portfolio
PowerShares Dynamic Banking Portfolio
PowerShares Dynamic Basic Materials Sector Portfolio
PowerShares Dynamic Consumer Discretionary Sector Portfolio
PowerShares Dynamic Consumer Staples Sector Portfolio
PowerShares Dynamic Healthcare Services Portfolio
PowerShares Dynamic Deep Value Portfolio
PowerShares Financial Preferred Portfolio
PowerShares Listed Private Equity Portfolio
PowerShares DWA Technical Leaders Portfolio
PowerShares Value Line Industry Rotation Portfolio
PowerShares WilderHill Progressive Energy Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as the Funds grow, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered and amounts paid to other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser's services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser's current organization, including operations assistance provided by the Adviser's parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser's portfolio transaction policies and procedures. The Trustees reviewed information on the performance of the Funds and the performance of their benchmark indices. The Trustees also reviewed reports on the correlation and tracking error between the underlying index and each Fund's performance and reviewed a report of Ibbotson Associates, a c onsultant to the Independent Trustees, that analyzed the reasons for any tracking error for certain of the Funds, which the Adviser then applied to its analysis of the tracking error between the underlying index and the performance of each Fund. The Trustees noted that, in each case, the correlation and tracking error was within the range set forth in the registration statement. The Trustees also concluded that each of the Funds is correlated to its underlying index and that the tracking error for each Fund was within a reasonable range in that Fund's particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds' administrator, custodian and transfer agent. They noted the significant amount of time and effort that had been devoted to this oversight function.
Based on their review, the Trustees found that the nature and extent of services provided to the Funds under the Investment Advisory Agreement are appropriate and that the quality is good.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund's expense ratio and the advisory fee, as compared to three categories of comparable
95
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
funds selected by Lipper Inc., an independent source: exchange-traded index funds ("ETFs"), open-end (non-ETF) index funds and open-end actively-managed funds. The Adviser supplemented the information prepared by Lipper Inc. with data it compiled on expense ratios and advisory fees of newer ETFs that recently commenced operations. The Trustees noted that the annual advisory fee charged to the Funds was identical (0.50% of average net assets), except for the advisory fee for the PowerShares High Yield Equity Dividend Achievers(TM) Portfolio, the PowerShares Dividend Achievers(TM) Portfolio, the PowerShares High Growth Rate Dividend Achievers(TM) Portfolio and the PowerShares International Dividend AchieversTM Portfolio (for each of which the annual advisory fee was 0.40% of average net assets), and that the Adviser had agreed to waive the fee and/or pay expenses to the extent necessary to prevent the annual operating e xpenses of each Fund (excluding interest expenses, licensing fees and offering costs (for all Funds other than the initial two Funds, the PowerShares Dynamic OTC Portfolio and the PowerShares Dynamic Market Portfolio), brokerage commissions and other trading expenses, taxes and extraordinary expenses) from exceeding 0.60% of average net assets (0.50% of average net assets for the PowerShares High Yield Equity Dividend Achievers(TM) Portfolio, the PowerShares Dividend Achievers(TM) Portfolio, the PowerShares High Growth Rate Dividend Achievers(TM) Portfolio and the PowerShares International Dividend Achievers(TM) Portfolio) at least until April 30, 2009. The Trustees noted that the Adviser represented that it does not provide investment management services to clients other than the Trust and other exchange-traded funds overseen by the Board. The Trustees noted that the advisory fees were at the higher end of the ETF peer funds, but were lower than the median of the open-end actively-managed peer funds. The Tr ustees determined that the advisory fees were reasonable because of the complexity of the indices, which generally require more frequent rebalancing of the portfolios, the distinguishing factors of the Funds, and the higher administrative, operational and management oversight costs for the Adviser. With respect to the Funds' expense ratios, the Trustees noted that the net expense ratios were at the higher end of the ETF peer funds, but were generally lower than the median of the expense ratios of the open-end (non-ETF) index peer funds and the median of the open-end actively-managed peer funds. The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds. The Board concluded that the advisory fee and expense ratio of each Fund are competitive and that the advisory fee for each Fund is reasonable and appropriate in amount in light of the quality of services provided and the expense cap in place.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability as well as any profits realized by the Adviser from its relationship to each Fund. The Trustees concluded that the profitability to the Adviser of the advisory services provided to the Funds is not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund's asset size, expense ratio, expense limitation agreed to by the Adviser and whether the investment process produced economies of scale. The Trustees noted that certain fixed costs associated with the management of the Funds are being reduced on a per-Fund basis as additional Funds are added, and that the gradual reduction of the per-Fund cost enabled the Adviser to operate some of the Funds under the expense cap, which potentially would lower the costs to shareholders. The Trustees noted that
96
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
the Excess Expense Agreement with the Trust provided that the Adviser was entitled to be reimbursed by each Fund for fees waived or expenses absorbed pursuant to the expense cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its expense cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds, and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
97
This page intentionally left blank
This page intentionally left blank
This page intentionally left blank
PROXY VOTING POLICIES AND PROCEDURES
A description of the Funds' proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 337-4246. This information is also available on the Securities and Exchange Commission's ("Commission") website at www.sec.gov.
Information regarding how the Funds voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 337-4246; or (ii) accessing the Funds' Form N-PX on the Commission's website at www.sec.gov.
QUARTERLY PORTFOLIOS
The Funds file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds' Forms N-Q are available on the Commission's website at www.sec.gov. The Funds' Forms N-Q may also be reviewed and copied at the Commission's Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
There are risks involved in investing in ETFs, including possible loss of money. Investing in securities of small and medium sized companies involves greater risk than is customarily associated with investing in more established companies, and investments in concentrated industry sectors involve greater risks than investments that are more diversified. PowerShares ETFs are not actively managed and are subject to risks similar to stocks, including those related to short selling and margin maintenance. PowerShares ETFs are not FDIC insured, may lose value and have no bank guarantee. PowerShares is a registered trademark of Invesco PowerShares Capital Management LLC. Past performance is not a guarantee of future results.
Invesco Aim Distributors, Inc. is the distributor of the PowerShares Exchange-Traded Fund Trust.
An investor should consider each Fund's investment objective, risks, charges and expenses carefully before investing. For more complete information about PowerShares ETFs call Invesco Aim Distributors, Inc. at (800) 337-4246 or visit our website invescopowershares.com for a prospectus. Please read the prospectus carefully before investing.
301 West Roosevelt Road
Wheaton, IL 60187
800.983.0903
www.invescopowershares.com
© 2008 Invesco PowerShares Capital Management LLC P-PS-AR-7
2008 Annual Report to Shareholders
30 April 2008
PowerShares FTSE RAFI Basic Materials Sector Portfolio
PowerShares FTSE RAFI Consumer Goods Sector Portfolio
PowerShares FTSE RAFI Consumer Services Sector Portfolio
PowerShares FTSE RAFI Energy Sector Portfolio
PowerShares FTSE RAFI Financials Sector Portfolio
PowerShares FTSE RAFI Health Care Sector Portfolio
PowerShares FTSE RAFI Industrials Sector Portfolio
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares FTSE RAFI Utilities Sector Portfolio
Table of Contents
Shareholder Letter | 2 | ||||||
The Market Environment | 3 | ||||||
Manager's Analysis | 4 | ||||||
Funds' Distribution History | 31 | ||||||
Frequency Distribution of Discounts & Premiums | 32 | ||||||
Fees and Expenses | 34 | ||||||
Fundamental Indices Portfolios | |||||||
Schedules of Investments | |||||||
PowerShares FTSE RAFI Basic Materials Sector Portfolio | 36 | ||||||
PowerShares FTSE RAFI Consumer Goods Sector Portfolio | 37 | ||||||
PowerShares FTSE RAFI Consumer Services Sector Portfolio | 39 | ||||||
PowerShares FTSE RAFI Energy Sector Portfolio | 41 | ||||||
PowerShares FTSE RAFI Financials Sector Portfolio | 42 | ||||||
PowerShares FTSE RAFI Health Care Sector Portfolio | 46 | ||||||
PowerShares FTSE RAFI Industrials Sector Portfolio | 47 | ||||||
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio | 50 | ||||||
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio | 52 | ||||||
PowerShares FTSE RAFI Utilities Sector Portfolio | 68 | ||||||
Statements of Assets and Liabilities | 70 | ||||||
Statements of Operations | 72 | ||||||
Statements of Changes in Net Assets | 74 | ||||||
Financial Highlights | 78 | ||||||
Notes to Financial Statements | 83 | ||||||
Report of Independent Registered Public Accounting Firm | 93 | ||||||
Supplemental Information | 94 | ||||||
Information about Advisory Agreement | 100 | ||||||
To My Fellow Investors,
It gives me great pleasure to report on the state of your investment in PowerShares Exchange-Traded Funds and to thank you for your continued confidence in Invesco PowerShares Capital Management LLC.
Invesco PowerShares has accomplished a number of corporate and industry achievements in 2007. Some of the most notable successes over the past 12 months are that PowerShares:
• Was the first to receive approval from the SEC to operate actively managed equity and fixed-income ETFs.
• Launched our initial group of international ETFs, which invest directly in securities listed on foreign exchanges. As of April 30, 2008, we had 17 ETFs allowing investors to invest across a wide geographic range.
• Brought out the markets only ETFs investing in insured municipal bonds. These three ETF's were part of our initial entry into the Fixed Income portion of the investment spectrum.
• Further enhanced our reputation as one of the leading innovators in the ETF marketplace when the PowerShares S&P Buy-Write Portfolio was awarded the most innovative new ETF for 2007.
• Expanded our global footprint with the introduction of 14 PowerShares ETFs listed on four major stock exchanges across Europe (London, Milan, Frankfurt and Paris).
• Launched the PowerShares India Portfolio, one of the first ETFs to provide U.S. investors with direct access to securities listed on the India stock exchange.
Another milestone of the past year was the adoption of our new name, Invesco PowerShares – in short, we have a new corporate name. Invesco PowerShares represents the strength of global diversification you get through the combination of Invesco's worldwide resources and PowerShares' market leading ETF capabilities. As one of the world's largest and most diversified global investment organizations, Invesco has more than 500 investment professionals operating in investment centers in 25 cities, a presence in 12 countries and $500 billion in assets under management globally at the end of 2007.
While our name has changed and we have a new corporate logo, our goal of delivering the highest quality investment management available in the ETF structure has not changed and all of the names of your funds and their trading symbols remain the same – as do all of our telephone contact numbers. All of us at Invesco PowerShares will continue to strive to provide you with compelling investment solutions and high-quality customer service. Regardless of market conditions, Invesco PowerShares will hold true to its mission: seeking to build financial security for investors.
Best Regards,
H. Bruce Bond
President and Chairman of the Board of Trustees
PowerShares Exchange-Traded Fund Trust
2
The Market Environment
Although the benchmark S&P 500 index hit an all-time high in October, 2007, it capitulated as the subprime mortgage crisis began to negatively affect the balance sheets of major U.S. financial institutions. As a result, volatility (as measured by the CBOE "VIX" index) increased by 46.2% during the April 30, 2007 to April 30, 2008 reporting period. Another dramatic rise over the same timeframe was the price of crude oil, which rallied 72.7%. U.S. economic growth began to slow significantly in Q1 2008, leading to recession concerns addressed by the Federal Reserve Bank through aggressive monetary policy easing (the Fed Fund target rate was cut by 2.25% in 2008). The combination of lower short-term U.S. interest rates and the recycling of petrodollars into European banks caused the U.S. dollar to weaken versus all G7 currencies for the year ended April 30, 2008.
By March, 2008, even the AAA-rated monoline bond insurers succumbed to the U.S. credit crunch. Bond insurer ratings downgrades led to huge displacements within the municipal bond market. An impending liquidity crisis was quelled in mid-March by the Fed via the creation of a $200bn lending facility and the approval of Bear Stearns' sale to JP Morgan. Along with the restoration of confidence in the U.S. financial system came a respectable April rally in the U.S. equity market, leaving the S&P 500 with a yearly total return of -4.68% over the reporting period while the DJIA was 0.47% and the NASDAQ-100 was +3.18%. For the same period, the Lehman Brothers U.S. Aggregate Total Return bond index was 6.87%.
3
Manager's Analysis
PowerShares FTSE RAFI Basic Materials Sector Portfolio (ticker: PRFM)
The PowerShares FTSE RAFI Basic Materials Sector Portfolio seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the FTSE RAFI Basic Materials Sector Index. The FTSE RAFI Basic Materials Sector Index is designed to track the performance of the largest U.S. equities in the basic materials sector which are selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. The equities are then weighted by each of these four fundamental measures. An overall weight is calculated for each firm by equally-weighting each fundamental measure. Each of the equities with the highest fundamental weight are then selected and assigned a weight equal to its fundamental weight.
During the reporting period, the PowerShares FTSE RAFI Basic Materials Sector Portfolio returned 9.50%, underperforming the S&P Materials Index, which returned 12.78%.
The portfolio was underweight in Monsanto Co., Freeport-McMoRan Copper & Gold, Inc., and Nucor Corp., and overweight in International Paper Co., Weyerhaeuser Co., and Dow Chemical Co., which contributed to its underperformance relative to the S&P Materials Index.
The portfolio was also negatively affected by stock selection, including AbitibiBowater, Inc., USEC, Inc., and Chemtura Corp.
Top performers in the portfolio were Mosaic Co., AK Steel Holding Corp., Massey Energy, and Monsanto. Top contributors to performance were Monsanto, Mosaic Co., and United States Steel Corp. Bottom contributors included International Paper Co. and AbitibiBowater, Inc.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Chemicals-Diversified | 33.4 | ||||||
Chemicals-Specialty | 10.7 | ||||||
Steel-Producers | 9.7 | ||||||
Industrial Gases | 7.0 | ||||||
Metal-Aluminum | 6.8 | ||||||
Paper & Related Products | 6.7 | ||||||
Forestry | 6.0 | ||||||
Agricultural Chemicals | 3.6 | ||||||
Coal | 3.6 | ||||||
Metal-Diversified | 2.8 | ||||||
Gold Mining | 2.2 | ||||||
Metal Processors & Fabricate | 1.7 | ||||||
Coatings/Paint | 1.5 | ||||||
Office Supplies & Forms | 1.5 | ||||||
Metal-Copper | 1.0 | ||||||
Steel-Specialty | 0.6 | ||||||
Non-Ferrous Metals | 0.3 | ||||||
Money Market Fund | 1.0 | ||||||
Other | (0.1 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Dow Chemical (The) Co. | 13.5 | ||||||
E.I. du Pont de Nemours & Co. | 10.8 | ||||||
Alcoa, Inc. | 6.8 | ||||||
Weyerhaeuser Co. | 6.0 | ||||||
International Paper Co. | 5.1 | ||||||
Nucor Corp. | 3.7 | ||||||
Air Products & Chemicals, Inc. | 3.5 | ||||||
United States Steel Corp. | 3.3 | ||||||
Praxair, Inc. | 3.1 | ||||||
PPG Industries, Inc. | 3.0 | ||||||
Total | 58.8 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 50.7 | ||||||
Mid-Cap Value | 21.3 | ||||||
Large-Cap Growth | 18.5 | ||||||
Mid-Cap Growth | 5.8 | ||||||
Small-Cap Value | 3.6 | ||||||
Small-Cap Growth | 0.1 |
4
Manager's Analysis (Continued)
PowerShares FTSE RAFI Basic Materials Sector Portfolio (ticker: PRFM)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
FTSE RAFI Basic Materials Sector Index | 10.75 | 23.66 | 40.93 | ||||||||||||
S&P Materials Index | 12.78 | 23.68 | 40.96 | ||||||||||||
Dow Jones Basic Materials Index | 20.58 | 29.28 | 51.42 |
Fund
NAV Return | 9.50 | 22.26 | 38.16 | ||||||||||||
Share Price Return | 9.05 | 21.93 | 37.62 |
Fund Inception: 20 September 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.48%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.75% while the Fund's gross total operating expense ratio was 1.50%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Materials Index and the Dow Jones Basic Materials Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 29 and 90 common stocks, respectively.
† Average annualized.
5
Manager's Analysis
PowerShares FTSE RAFI Consumer Goods Sector Portfolio (ticker: PRFG)
The PowerShares FTSE RAFI Consumer Goods Sector Portfolio seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the FTSE RAFI Consumer Goods Sector Index. The FTSE RAFI Consumer Goods Sector Index is designed to track the performance of the largest U.S. equities in the consumer goods sector which are selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. The equities are then weighted by each of these four fundamental measures. An overall weight is calculated for each firm by equally-weighting each fundamental measure. Each of the equities with the highest fundamental weight are then selected and assigned a weight equal to its fundamental weight.
During the reporting period, the PowerShares FTSE RAFI Consumer Goods Sector Portfolio returned -8.80%, behind S&P Consumer Staples Index, which returned 5.53%.
The portfolio was negatively affected by the selection of General Motors Corp., which the S&P Consumer Staples Index did not hold. The portfolio also suffered from overweighting Kraft Foods, Inc. The portfolio did not hold Wal-Mart Stores, Inc., which also contributed to its underperformance relative to the S&P Consumer Staples Index.
Top performers in the portfolio included Fresh Del Monte Product, Inc., Chiquita Brands International, Inc., and Bunge Ltd. Top contributors to return included Coca-Cola Co., Bunge Ltd., and Nike, Inc. Bottom contributors included General Motors Corp., Kraft Foods, Inc., and TRW Automotive Holdings Corp.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Agriculture | 17.7 | ||||||
Food | 17.7 | ||||||
Auto Manufacturers | 13.7 | ||||||
Beverages | 12.2 | ||||||
Cosmetics/Personal Care | 10.6 | ||||||
Home Builders | 6.6 | ||||||
Auto Parts & Equipment | 6.4 | ||||||
Household Products/Wares | 3.0 | ||||||
Apparel | 1.7 | ||||||
Retail | 1.7 | ||||||
Miscellaneous Manufacturing | 1.5 | ||||||
Leisure Time | 1.2 | ||||||
Home Furnishings | 1.1 | ||||||
Hand/Machine Tools | 0.9 | ||||||
Toys/Games/Hobbies | 0.9 | ||||||
Distribution/Wholesale | 0.7 | ||||||
Software | 0.7 | ||||||
Housewares | 0.6 | ||||||
Textiles | 0.6 | ||||||
Electrical Components & Equipment | 0.2 | ||||||
Office Furnishings | 0.2 | ||||||
Electronics | 0.1 | ||||||
Machinery-Diversified | 0.1 | ||||||
Pharmaceuticals | 0.1 | ||||||
Money Market Fund | 3.0 | ||||||
Other | (3.2 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Philip Morris International, Inc. | 9.2 | ||||||
Ford Motor Co. | 8.9 | ||||||
Procter & Gamble (The) Co. | 7.5 | ||||||
General Motors Corp. | 4.8 | ||||||
Kraft Foods, Inc., Class A | 4.7 | ||||||
PepsiCo, Inc. | 4.0 | ||||||
Altria Group, Inc. | 3.6 | ||||||
Coca-Cola (The) Co. | 3.3 | ||||||
Anheuser-Busch Cos., Inc. | 2.1 | ||||||
Kimberly-Clark Corp. | 2.0 | ||||||
Total | 50.1 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Growth | 31.8 | ||||||
Large-Cap Value | 29.3 | ||||||
Mid-Cap Value | 24.3 | ||||||
Small-Cap Value | 8.9 | ||||||
Mid-Cap Growth | 4.8 | ||||||
Small-Cap Growth | 0.9 |
6
Manager's Analysis (Continued)
PowerShares FTSE RAFI Consumer Goods Sector Portfolio (ticker: PRFG)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
FTSE RAFI Consumer Goods Sector Index | -5.67 | 3.21 | 5.24 | ||||||||||||
S&P Consumer Staples Index | 5.53 | 8.35 | 13.83 | ||||||||||||
Dow Jones Consumer Goods Index | -3.85 | 3.98 | 6.51 |
Fund
NAV Return | -8.80 | 0.64 | 1.04 | ||||||||||||
Share Price Return | -8.83 | 0.64 | 1.03 |
Fund Inception: 20 September 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.67%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.82% while the Fund's gross total operating expense ratio was 2.93%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Consumer Staples Index and the Dow Jones Consumer Goods Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 39 and 160 common stocks, respectively.
† Average annualized.
7
Manager's Analysis
PowerShares FTSE RAFI Consumer Services Sector Portfolio (ticker: PRFS)
The PowerShares FTSE RAFI Consumer Services Sector Portfolio seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the FTSE RAFI Consumer Services Sector Index. The FTSE RAFI Consumer Services Sector Index is designed to track the performance of the largest U.S. equities in the consumer services sector which are selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. The equities are then weighted by each of these four fundamental measures. An overall weight is calculated for each firm by equally-weighting each fundamental measure. Each of the equities with the highest fundamental weight are then selected and assigned a weight equal to its fundamental weight.
Over the reporting period, the PowerShares FTSE RAFI Consumer Services Sector Portfolio returned -15.32%, ahead of the S&P Consumer Discretionary Index, which returned -16.30%.
The portfolio benefited from stock selection in the consumer staples sector, including holding Wal-Mart Stores, which was not in the S&P Consumer Discretionary Index.
Top performers in the portfolio included Dow Jones, Inc., GameStop Corp., and EchoStar Corp. Top contributors to return included Wal-Mart Stores, Inc., McDonald's Corp., Costco Wholesale Corp., and CVS Caremark Corp. Bottom contributors to return included Time Warner, Inc., Avis Budget Group, Inc., and Idearc, Inc.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Retail | 48.7 | ||||||
Media | 23.3 | ||||||
Food | 7.1 | ||||||
Commercial Services | 4.9 | ||||||
Pharmaceuticals | 3.4 | ||||||
Internet | 3.1 | ||||||
Airlines | 1.7 | ||||||
Lodging | 1.7 | ||||||
Advertising | 1.5 | ||||||
Leisure Time | 1.5 | ||||||
Entertainment | 1.0 | ||||||
Distribution/Wholesale | 0.1 | ||||||
Household Products/Wares | 0.1 | ||||||
Trucking & Leasing | 0.1 | ||||||
Money Market Fund | 1.8 | ||||||
Other | (0.0 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Wal-Mart Stores, Inc. | 10.8 | ||||||
Home Depot (The), Inc. | 4.7 | ||||||
Time Warner, Inc. | 4.1 | ||||||
Walt Disney (The) Co. | 2.8 | ||||||
Target Corp. | 2.5 | ||||||
Comcast Corp., Class A | 2.4 | ||||||
McDonald's Corp. | 2.3 | ||||||
News Corp., Class A | 2.3 | ||||||
Lowe's Cos., Inc. | 2.1 | ||||||
Costco Wholesale Corp. | 2.1 | ||||||
Total | 36.1 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 33.3 | ||||||
Large-Cap Growth | 32.9 | ||||||
Mid-Cap Value | 15.7 | ||||||
Mid-Cap Growth | 9.6 | ||||||
Small-Cap Value | 6.0 | ||||||
Small-Cap Growth | 2.5 |
8
Manager's Analysis (Continued)
PowerShares FTSE RAFI Consumer Services Sector Portfolio (ticker: PRFS)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
FTSE RAFI Consumer Services Sector Index | -15.09 | -2.33 | -3.74 | ||||||||||||
S&P Consumer Discretionary Index | -16.30 | -3.25 | -5.20 | ||||||||||||
Dow Jones Consumer Services Index | -13.59 | -2.43 | -3.89 |
Fund
NAV Return | -15.32 | -2.83 | -4.51 | ||||||||||||
Share Price Return | -15.43 | -2.87 | -4.59 |
Fund Inception: 20 September 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.86%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.79% while the Fund's gross total operating expense ratio was 2.36%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Consumer Discretionary Index and the Dow Jones Consumer Services Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 88 and 250 common stocks, respectively.
† Average annualized.
9
Manager's Analysis
PowerShares FTSE RAFI Energy Sector Portfolio (ticker: PRFE)
The PowerShares FTSE RAFI Energy Sector Portfolio seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the FTSE RAFI Oil & Gas Index. The FTSE RAFI Oil & Gas Index is designed to track the performance of the largest U.S. equities in the energy sector which are selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. The equities are then weighted by each of these four fundamental measures. An overall weight is calculated for each firm by equally-weighting each fundamental measure. Each of the equities with the highest fundamental weight are then selected and assigned a weight equal to its fundamental weight.
Over the reporting period, the PowerShares FTSE RAFI Energy Sector Portfolio returned 25.22%, underperforming the S&P Energy Index, which returned 28.69%.
The portfolio was underweight in Schlumberger Ltd. and Transocean, Inc., which contributed to its underperformance relative to the S&P Energy Index.
Top performers in the portfolio included Stone Energy Corp., Southwestern Energy Co., and FMC Technologies, Inc. Top contributors to the portfolio included Chevron, Exxon Mobil, Occidental Petroleum, and ConocoPhillips. Bottom contributors included Valero Energy Corp., Tesoro Corp., and Sunoco, Inc.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Oil Companies-Integrated | 55.1 | ||||||
Oil Companies-Exploration & Production | 20.6 | ||||||
Oil-Field Services | 10.6 | ||||||
Oil Refining & Marketing | 6.0 | ||||||
Oil & Gas Drilling | 3.5 | ||||||
Oil Field Machinery & Equipment | 1.7 | ||||||
Pipelines | 1.3 | ||||||
Electric-Integrated | 0.6 | ||||||
Transport-Marine | 0.3 | ||||||
Money Market Fund | 0.5 | ||||||
Other | (0.2 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 77.1 | ||||||
Large-Cap Growth | 9.9 | ||||||
Mid-Cap Value | 8.4 | ||||||
Mid-Cap Growth | 3.7 | ||||||
Small-Cap Value | 0.8 | ||||||
Small-Cap Growth | 0.1 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Exxon Mobil Corp. | 20.2 | ||||||
Chevron Corp. | 15.3 | ||||||
ConocoPhillips | 13.0 | ||||||
Occidental Petroleum Corp. | 4.0 | ||||||
Valero Energy Corp. | 4.0 | ||||||
Marathon Oil Corp. | 3.7 | ||||||
Devon Energy Corp. | 3.2 | ||||||
Schlumberger Ltd. | 3.2 | ||||||
Apache Corp. | 2.6 | ||||||
Anadarko Petroleum Corp. | 2.6 | ||||||
Total | 71.8 |
10
Manager's Analysis (Continued)
PowerShares FTSE RAFI Energy Sector Portfolio (ticker: PRFE)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
FTSE RAFI Oil & Gas Index | 26.86 | 35.33 | 63.03 | ||||||||||||
S&P Energy Index | 28.69 | 34.81 | 62.02 | ||||||||||||
Dow Jones Oil & Gas Index | 27.43 | 34.11 | 60.65 |
Fund
NAV Return | 25.22 | 34.00 | 60.11 | ||||||||||||
Share Price Return | 24.99 | 33.76 | 59.77 |
Fund Inception: 20 September 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.36%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.74% while the Fund's gross total operating expense ratio was 1.27%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Energy Index and the Dow Jones Oil & Gas Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 34 and 70 common stocks, respectively.
† Average annualized.
11
Manager's Analysis
PowerShares FTSE RAFI Financials Sector Portfolio (ticker: PRFF)
The PowerShares FTSE RAFI Financials Sector Portfolio seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the FTSE RAFI Financials Sector Index. The FTSE RAFI Financials Sector Index is designed to track the performance of the largest U.S. equities in the financials sector which are selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. The equities are then weighted by each of these four fundamental measures. An overall weight is calculated for each firm by equally-weighting each fundamental measure. Each of the equities with the highest fundamental weight are then selected and assigned a weight equal to its fundamental weight.
Over the reporting period, PowerShares FTSE RAFI Financials Sector Portfolio outperformed the S&P Financials Index, returning -25.22% compared to the S&P Financial Index's return of -26.28%.
Stock selection contributed to the portfolio's outperformance relative to the S&P Financial Index, including the selection of Berkshire Hathaway, which was not held in the S&P Financial Index.
Top performers in the portfolio included MasterCard and Hudson Citi Bancorp. Top contributors to return included Berkshire Hathaway and U.S. Bancorp. Bottom contributors included Citigroup, Bank of America, and American International Group.
12
Manager's Analysis (Continued)
PowerShares FTSE RAFI Financials Sector Portfolio (ticker: PRFF)
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Finance-Investment Banker | 25.0 | ||||||
Super-Regional Banks-U.S. | 21.6 | ||||||
Multi-line Insurance | 12.2 | ||||||
Finance-Mortgage Loan/Banker | 4.7 | ||||||
Property/Casualty Insurance | 4.4 | ||||||
Reinsurance | 4.4 | ||||||
Life/Health Insurance | 4.0 | ||||||
Commercial Banks-Southern U.S. | 2.6 | ||||||
Finance-Credit Card | 1.9 | ||||||
S&L/Thrifts-Western U.S. | 1.7 | ||||||
Fiduciary Banks | 1.5 | ||||||
REITS-Diversified | 1.3 | ||||||
Insurance Brokers | 1.2 | ||||||
Investment Management/Advisory Service | 1.2 | ||||||
REITS-Apartments | 1.2 | ||||||
REITS-Office Property | 1.0 | ||||||
Commercial Banks-Central U.S. | 0.9 | ||||||
Financial Guarantee Insurance | 0.9 | ||||||
REITS-Regional Malls | 0.9 | ||||||
REITS-Shopping Centers | 0.8 | ||||||
S&L/Thrifts-Eastern U.S. | 0.8 | ||||||
REITS-Health Care | 0.7 | ||||||
Commercial Banks-Eastern U.S. | 0.6 | ||||||
REITS-Warehouse/Industry | 0.6 | ||||||
Commercial Banks-Western U.S. | 0.5 | ||||||
Investment Companies | 0.5 | ||||||
Finance-Consumer Loans | 0.4 | ||||||
Commercial Service-Finance | 0.3 | ||||||
Finance-Other Services | 0.3 | ||||||
REITS-Hotels | 0.3 | ||||||
REITS-Mortgage | 0.3 | ||||||
Finance-Commercial | 0.2 | ||||||
Forestry | 0.2 | ||||||
Paper & Related Products | 0.2 | ||||||
REITS-Storage | 0.2 | ||||||
Finance-Auto Loans | 0.1 | ||||||
Real Estate Management/Service | 0.1 | ||||||
REITS-Single Tenant | 0.1 | ||||||
S&L/Thrifts-Central U.S. | 0.1 | ||||||
Money Market Fund | 0.6 | ||||||
Other | (0.5 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Citigroup, Inc. | 9.9 | ||||||
Bank of America Corp. | 7.4 | ||||||
JPMorgan Chase & Co. | 6.7 | ||||||
American International Group, Inc. | 4.9 | ||||||
Wells Fargo & Co. | 3.7 | ||||||
Wachovia Corp. | 3.5 | ||||||
Berkshire Hathaway, Inc., Class B | 3.3 | ||||||
Morgan Stanley | 2.6 | ||||||
Fannie Mae | 2.3 | ||||||
U.S. Bancorp | 2.1 | ||||||
Total | 46.4 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 64.3 | ||||||
Mid-Cap Value | 17.1 | ||||||
Large-Cap Growth | 10.1 | ||||||
Mid-Cap Growth | 4.5 | ||||||
Small-Cap Value | 3.5 | ||||||
Small-Cap Growth | 0.5 |
13
Manager's Analysis (Continued)
PowerShares FTSE RAFI Financials Sector Portfolio (ticker: PRFF)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
FTSE RAFI Financials Sector Index | -25.12 | -11.66 | -18.16 | ||||||||||||
S&P Financials Index | -26.28 | -12.61 | -19.56 | ||||||||||||
Dow Jones Financials Index | -26.89 | -14.13 | -21.81 |
Fund
NAV Return | -25.22 | -12.12 | -18.77 | ||||||||||||
Share Price Return | -25.52 | -12.31 | -19.07 |
Fund Inception: 20 September 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.97%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.75% while the Fund's gross total operating expense ratio was 1.49%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Financials Index and the Dow Jones Financials Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 93 and 300 common stocks, respectively.
† Average annualized.
14
This page intentionally left blank
Manager's Analysis
PowerShares FTSE RAFI Health Care Sector Portfolio (ticker: PRFH)
The PowerShares FTSE RAFI Health Care Sector Portfolio seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the FTSE RAFI Health Care Sector Index. The FTSE RAFI Health Care Sector Index is designed to track the performance of the largest U.S. equities in the health care sector which are selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. The equities are then weighted by each of these four fundamental measures. An overall weight is calculated for each firm by equally-weighting each fundamental measure. Each of the equities with the highest fundamental weight are then selected and assigned a weight equal to its fundamental weight.
Over the reporting period, the PowerShares FTSE RAFI Health Care Sector Portfolio returned -12.32%, behind the S&P Health Care Index, which returned -11.11%.
The portfolio suffered from underweighting Gilead Sciences and overweighting Bristol-Myers. The portfolio also was affected negatively by including Health Net and Lincare Holdings.
Top performers in the portfolio were Dade Behring Holdings, Express Scripts, and Invitrogen Corp. Top contributors to performance were Johnson & Johnson, Medco Health Solutions, and Express Scripts. Bottom contributors to performance included Pfizer, Bristol-Myers Squibb, and Merck & Co., Inc.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Pharmaceuticals | 52.1 | ||||||
Healthcare-Products | 25.1 | ||||||
Healthcare-Services | 14.9 | ||||||
Biotechnology | 5.7 | ||||||
Electronics | 1.5 | ||||||
Distribution/Wholesale | 0.2 | ||||||
Commercial Services | 0.1 | ||||||
Money Market Fund | 1.5 | ||||||
Other | (1.1 | ) |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 52.5 | ||||||
Large-Cap Growth | 36.0 | ||||||
Mid-Cap Growth | 7.0 | ||||||
Mid-Cap Value | 2.7 | ||||||
Small-Cap Value | 1.6 | ||||||
Small-Cap Growth | 0.2 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Pfizer, Inc. | 16.9 | ||||||
Johnson & Johnson | 12.7 | ||||||
Merck & Co., Inc. | 7.4 | ||||||
Bristol-Myers Squibb Co. | 5.4 | ||||||
Abbott Laboratories | 5.0 | ||||||
Wyeth | 4.5 | ||||||
Eli Lilly & Co. | 4.2 | ||||||
Amgen, Inc. | 2.9 | ||||||
Medco Health Solutions, Inc. | 2.8 | ||||||
WellPoint, Inc. | 2.8 | ||||||
Total | 64.6 |
16
Manager's Analysis (Continued)
PowerShares FTSE RAFI Health Care Sector Portfolio (ticker: PRFH)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
FTSE RAFI Health Care Sector Index | -11.88 | -1.96 | -3.15 | ||||||||||||
S&P Health Care Index | -11.11 | -1.79 | -2.87 | ||||||||||||
Dow Jones Health Care Index | -10.59 | -1.93 | -3.10 |
Fund
NAV Return | -12.32 | -2.56 | -4.09 | ||||||||||||
Share Price Return | -12.52 | -2.70 | -4.32 |
Fund Inception: 20 September 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.39%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.75% while the Fund's gross total operating expense ratio was 1.55%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Health Care Index and the Dow Jones Health Care Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 51 and 180 common stocks, respectively.
† Average annualized.
17
Manager's Analysis
PowerShares FTSE RAFI Industrials Sector Portfolio (ticker: PRFN)
The PowerShares FTSE RAFI Industrials Sector Portfolio seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the FTSE RAFI Industrials Sector Index. The FTSE RAFI Industrials Sector Index is designed to track the performance of the largest U.S. equities in the industrials sector which are selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. The equities are then weighted by each of these four fundamental measures. An overall weight is calculated for each firm by equally-weighting each fundamental measure. Each of the equities with the highest fundamental weight are then selected and assigned a weight equal to its fundamental weight.
During the reporting period, the PowerShares FTSE RAFI Industrials Sector Portfolio returned less than 0.01%, behind the S&P Industrials Index, which returned 3.04%
Underperformance resulted from stock selection among mid value stocks. The portfolio held several stocks in this style that underperformed and were not included in the S&P Industrials Index. Underperformance also resulted from stock selection in the information technology and materials sectors.
Top performers in the portfolio included Tecumseh Products, Flowserve Corp., and Owens-Illinois, Inc. Top contributors to performance included Deer & Co., Owens-Illinois, Inc., and CSX Corp. Bottom contributors included General Electric and Boeing.
18
Manager's Analysis (Continued)
PowerShares FTSE RAFI Industrials Sector Portfolio (ticker: PRFN)
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Miscellaneous Manufacturing | 31.9 | ||||||
Aerospace/Defense | 14.6 | ||||||
Transportation | 14.3 | ||||||
Commercial Services | 6.4 | ||||||
Electronics | 5.2 | ||||||
Machinery-Diversified | 3.0 | ||||||
Machinery-Construction & Mining | 2.8 | ||||||
Building Materials | 2.6 | ||||||
Environmental Control | 2.6 | ||||||
Electrical Components & Equipment | 2.5 | ||||||
Engineering & Construction | 2.4 | ||||||
Packaging & Containers | 2.4 | ||||||
Auto Manufacturers | 1.5 | ||||||
Forest Products & Paper | 1.4 | ||||||
Software | 1.2 | ||||||
Distribution/Wholesale | 1.0 | ||||||
Metal Fabricate/Hardware | 0.9 | ||||||
Household Products/Wares | 0.7 | ||||||
Chemicals | 0.5 | ||||||
Computers | 0.4 | ||||||
Electric | 0.4 | ||||||
Hand/Machine Tools | 0.3 | ||||||
Mining | 0.3 | ||||||
Retail | 0.3 | ||||||
Telecommunications | 0.2 | ||||||
Textiles | 0.2 | ||||||
Trucking & Leasing | 0.2 | ||||||
Energy-Alternative Sources | 0.1 | ||||||
Money Market Fund | 2.0 | ||||||
Other | (2.3 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
General Electric Co. | 15.9 | ||||||
United Parcel Service, Inc., Class B | 3.8 | ||||||
United Technologies Corp. | 3.1 | ||||||
Tyco International Ltd. (Bermuda) | 2.8 | ||||||
Boeing Co. | 2.8 | ||||||
3M Co. | 2.6 | ||||||
Caterpillar, Inc. | 2.4 | ||||||
Honeywell International, Inc. | 2.1 | ||||||
Northrop Grumman Corp. | 2.0 | ||||||
Emerson Electric Co. | 2.0 | ||||||
Total | 39.5 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 49.4 | ||||||
Large-Cap Growth | 18.6 | ||||||
Mid-Cap Value | 14.8 | ||||||
Mid-Cap Growth | 12.1 | ||||||
Small-Cap Value | 4.8 | ||||||
Small-Cap Growth | 0.3 |
19
Manager's Analysis (Continued)
PowerShares FTSE RAFI Industrials Sector Portfolio (ticker: PRFN)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
FTSE RAFI Industrials Sector Index | 0.67 | 10.99 | 18.35 | ||||||||||||
S&P Industrials Index | 3.04 | 10.42 | 17.36 | ||||||||||||
Dow Jones Industrials Index | 0.65 | 9.73 | 16.18 |
Fund
NAV Return | 0.00 | 10.26 | 17.02 | ||||||||||||
Share Price Return | -0.49 | 9.88 | 16.39 |
Fund Inception: 20 September 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.22%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.72% while the Fund's gross total operating expense ratio was 0.99%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Industrials Index and the Dow Jones Industrials Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 56 and 270 common stocks, respectively.
† Average annualized.
20
This page intentionally left blank
Manager's Analysis
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio (ticker: PRFQ)
The PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the FTSE RAFI Telecommunications & Technology Sector Index. The FTSE RAFI Telecommunications & Technology Sector Index is designed to track the performance of the largest U.S. equities in the telecommunications & technology sector which are selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. The equities are then weighted by each of these four fundamental measures. An overall weight is calculated for each firm by equally-weighting each fundamental measure. Each of the equities with the highest fundamental weight are then selected and assigned a weight equal to its fundamental weight.
Over the reporting period the PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio returned -5.79%, behind the S&P Information Technology Index, which returned 1.00%.
The portfolio was underweighted in Apple and Google, which contributed to its underperformance. The portfolio also was negatively affected by its allocation to the communication sector, included Sprint Nextel and Qwest Communications.
Top performers in the portfolio were Apple, Leucadia National Corp, BEA Systems, and Western Digital Corp. Top contributors to performance were IBM, Apple, Intel, and Hewlett-Packard. Bottom contributors to performance included Sprint Nextel Corp. and Microsoft Corp.
22
Manager's Analysis (Continued)
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio (ticker: PRFQ)
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Telephone-Integrated | 30.3 | ||||||
Applications Software | 15.4 | ||||||
Computers | 11.6 | ||||||
Electronic Component-Semiconductors | 8.6 | ||||||
Networking Products | 4.6 | ||||||
Wireless Equipment | 4.6 | ||||||
Computer Services | 3.3 | ||||||
Enterprise Software/Services | 3.1 | ||||||
Computers-Memory Devices | 2.6 | ||||||
Office Automation & Equipment | 2.2 | ||||||
Web Portals/ISP | 1.8 | ||||||
Distribution/Wholesale | 1.6 | ||||||
Internet Security | 1.6 | ||||||
Semiconductor Equipment | 1.4 | ||||||
Telecommunication Services | 1.3 | ||||||
Semiconductor Components-Integrated Circuit | 1.2 | ||||||
Computers-Integrated Systems | 0.8 | ||||||
Telecommunication Equipment Fiber Optics | 0.8 | ||||||
Cellular Telecommunications | 0.7 | ||||||
Telecommunication Equipment | 0.6 | ||||||
Consulting Services | 0.4 | ||||||
Electronic Design Automation | 0.4 | ||||||
Electronic Forms | 0.4 | ||||||
Computers-Peripheral Equipment | 0.3 | ||||||
Computer Aide Design | 0.2 | ||||||
Diversified Operations | 0.2 | ||||||
Medical Information Systems | 0.1 | ||||||
Retail-Computer Equipment | 0.1 | ||||||
Money Market Fund | 1.2 | ||||||
Other | (1.4 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Microsoft Corp. | 14.9 | ||||||
Verizon Communications, Inc. | 12.3 | ||||||
AT&T, Inc. | 10.9 | ||||||
Sprint Nextel Corp. | 4.3 | ||||||
Cisco Systems, Inc. | 4.2 | ||||||
International Business Machines Corp. | 3.4 | ||||||
Intel Corp. | 3.4 | ||||||
Hewlett-Packard Co. | 2.9 | ||||||
Oracle Corp. | 2.6 | ||||||
Motorola, Inc. | 2.4 | ||||||
Total | 61.3 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Growth | 45.2 | ||||||
Large-Cap Value | 34.6 | ||||||
Mid-Cap Growth | 8.6 | ||||||
Mid-Cap Value | 8.4 | ||||||
Small-Cap Value | 1.8 | ||||||
Small-Cap Growth | 1.4 |
23
Manager's Analysis (Continued)
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio (ticker: PRFQ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
FTSE RAFI Telecommunications & Technology Sector Index | -5.26 | 4.29 | 7.03 | ||||||||||||
S&P Technology and Telecom Index | 1.00 | 7.43 | 12.28 | ||||||||||||
Dow Jones Technology Index | -0.37 | 6.08 | 10.01 |
Index
NAV Return | -5.79 | 3.48 | 5.66 | ||||||||||||
Share Price Return | -6.10 | 3.32 | 5.41 |
Fund
Fund Inception: 20 September 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.40%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.75% while the Fund's gross total operating expense ratio was 1.50%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Information Technology Index and the Dow Jones Technology Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 70 and 252 common stocks, respectively.
† Average annualized.
24
This page intentionally left blank
Manager's Analysis
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (ticker: PRFZ)
The PowerShares FTSE RAFI US 1500 Small-Mid Portfolio seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the FTSE RAFI US 1500 Small-Mid Index. The FTSE RAFI US 1500 Small-Mid Index is designed to track the performance of small and medium-sized U.S. companies which are selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. Each of the equities with a fundamental weight ranking of 1,001 to 2,500 is then selected and assigned a weight equal to its fundamental weight.
Over the reporting period, the PowerShares FTSE RAFI US 1500 Small-Mid Portfolio returned -11.10%, behind the S&P Small Cap 600 Index, which returned -9.04%
The portfolio underperformed relative to the S&P Small Cap 600 Index due to overallocation to the consumer discretionary sector. The portfolio also underperformed due to stock selection within the consumer discretionary sector.
Top performers in the portfolio included Lindsay Corp., CF Industries Holding, Inc., and Alpha Natural Resources, Inc. Top contributors to performance included CF Industries Holdings, Inc., Walter Industries, Inc., and Alpha Natural Resources, Inc. Bottom contributors included Western Refining, Inc., Cabela's, Inc., and Radio One, Inc.
Sector Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Financials | 22.3 | ||||||
Consumer Discretionary | 18.4 | ||||||
Industrials | 17.3 | ||||||
Information Technology | 15.4 | ||||||
Health Care | 7.3 | ||||||
Energy | 6.7 | ||||||
Materials | 5.1 | ||||||
Consumer Staples | 3.2 | ||||||
Utilities | 2.0 | ||||||
Telecommunication Services | 1.6 | ||||||
Money Market Fund | 0.4 | ||||||
Other | 0.3 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Small-Cap Value | 50.9 | ||||||
Small-Cap Growth | 32.7 | ||||||
Mid-Cap Growth | 12.9 | ||||||
Mid-Cap Value | 3.0 | ||||||
Large-Cap Growth | 0.5 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Finish Line (The), Inc., Class A | 0.2 | ||||||
Millennium Pharmaceuticals, Inc. | 0.2 | ||||||
Pier 1 Imports, Inc. | 0.2 | ||||||
Cypress Semiconductor Corp. | 0.2 | ||||||
FNB Corp. | 0.2 | ||||||
Arkansas Best Corp. | 0.2 | ||||||
First Niagara Financial Group, Inc. | 0.2 | ||||||
ON Semiconductor Corp. | 0.2 | ||||||
Edwards Lifesciences Corp. | 0.2 | ||||||
Modine Manufacturing Co. | 0.2 | ||||||
Total | 2.0 |
26
Manager's Analysis (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio (ticker: PRFZ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
FTSE RAFI US 1500 Small-Mid Index | -10.67 | 1.25 | 2.03 | ||||||||||||
Russell 2000® Index | -10.96 | -0.32 | -0.52 | ||||||||||||
S&P Small Cap 600 Index | -9.04 | 1.46 | 2.37 |
Fund
NAV Return | -11.10 | 0.51 | 0.83 | ||||||||||||
Share Price Return | -11.27 | 0.36 | 0.58 |
Fund Inception: 20 September 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.04%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.71% while the Fund's gross total operating expense ratio was 0.76%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The Russell 2000® Index and the S&P Small Cap 600 Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 2,000 and 600 common stocks, respectively.
† Average annualized.
27
Manager's Analysis
PowerShares FTSE RAFI Utilities Sector Portfolio (ticker: PRFU)
The PowerShares FTSE RAFI Utilities Sector Portfolio seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the FTSE RAFI Utilities Sector Index. The FTSE RAFI Utilities Sector Index is designed to track the performance of the largest U.S. equities in the utilities sector which are selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. The equities are then weighted by each of these four fundamental measures. An overall weight is calculated for each firm by equally-weighting each fundamental measure. Each of the equities with the highest fundamental weight are then selected and assigned a weight equal to its fundamental weight.
During the reporting period, the PowerShares FTSE RAFI Utilities Sector Portfolio returned -5.41%, behind S&P Utilities Index, which returned -0.61%.
The portfolio underperformed due to underweighting in Exelon and Questar Corp.
Top performers were Equitable Resources, Questar, Energen, and Exelon. Top contributors to return were Exelon and FirstEnergy Corp. Bottom contributors to return included Reliant Energy, Inc. and PG&E Corp.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Electric-Integrated | 78.0 | ||||||
Gas-Distribution | 8.8 | ||||||
Pipelines | 4.9 | ||||||
Independent Power Producer | 3.9 | ||||||
Electric-Generation | 2.2 | ||||||
Oil Companies-Exploration & Production | 0.7 | ||||||
Water | 0.2 | ||||||
Money Market Fund | 0.7 | ||||||
Other | 0.6 |
Style Allocation (% of the Fund's
Total Investments) as of 30 April 2008
Large-Cap Value | 50.5 | ||||||
Mid-Cap Value | 30.6 | ||||||
Large-Cap Growth | 8.6 | ||||||
Mid-Cap Growth | 5.2 | ||||||
Small-Cap Value | 5.1 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Duke Energy Corp. | 6.7 | ||||||
Exelon Corp. | 5.4 | ||||||
Southern Co. | 5.1 | ||||||
Dominion Resources, Inc. | 5.0 | ||||||
American Electric Power Co., Inc. | 3.9 | ||||||
FirstEnergy Corp. | 3.8 | ||||||
FPL Group, Inc. | 3.4 | ||||||
PG&E Corp. | 3.0 | ||||||
Entergy Corp. | 2.9 | ||||||
Progress Energy, Inc. | 2.9 | ||||||
Total | 42.1 |
28
Manager's Analysis (Continued)
PowerShares FTSE RAFI Utilities Sector Portfolio (ticker: PRFU)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
FTSE RAFI Utilities Sector Index | -2.10 | 13.08 | 21.97 | ||||||||||||
S&P Utilities Index | -0.61 | 14.68 | 24.76 | ||||||||||||
Dow Jones Utilities Index | -3.53 | 11.03 | 18.42 |
Fund
NAV Return | -5.41 | 10.35 | 17.16 | ||||||||||||
Share Price Return | -5.36 | 10.25 | 17.03 |
Fund Inception: 20 September 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.44%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.78% while the Fund's gross total operating expense ratio was 1.92%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Utilities Index and the Dow Jones Utilities Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 31 and 90 common stocks, respectively.
† Average annualized.
29
This page intentionally left blank
Funds' Distribution History
Ex-Dividend | 3/20/08 | 12/21/07 | 9/21/07 | 6/15/07 | 3/16/07 | 12/15/06 | |||||||||||||||||||||||||
Record | 3/25/08 | 12/26/07 | 9/25/07 | 6/19/07 | 3/20/07 | 12/19/06 | |||||||||||||||||||||||||
Payable | 3/31/08 | 12/31/07 | 9/28/07 | 6/29/07 | 3/30/07 | 12/29/06 | |||||||||||||||||||||||||
Fund | Ticker | ||||||||||||||||||||||||||||||
PowerShares FTSE RAFI Basic Materials Sector Portfolio | PRFM | 0.19513 | 0.43059 | 0.25074 | 0.57096 | 0.05952 | 0.59859 | ||||||||||||||||||||||||
PowerShares FTSE RAFI Consumer Goods Sector Portfolio | PRFG | — | 1.09861 | 0.25727 | 0.53722 | — | 0.32984 | ||||||||||||||||||||||||
PowerShares FTSE RAFI Consumer Services Sector Portfolio | PRFS | 0.02199 | 0.19606 | 0.01420 | 0.06886 | — | 0.09283 | ||||||||||||||||||||||||
PowerShares FTSE RAFI Energy Sector Portfolio | PRFE | 0.07520 | 0.07489 | 0.10533 | 0.21450 | 0.10320 | 0.10379 | ||||||||||||||||||||||||
PowerShares FTSE RAFI Financials Sector Portfolio | PRFF | 0.15685 | 0.37733 | 0.24030 | 0.34985 | — | 0.41582 | ||||||||||||||||||||||||
PowerShares FTSE RAFI Health Care Sector Portfolio | PRFH | 0.05750 | 0.15285 | 0.14791 | 0.30188 | 0.23850 | 0.13869 | ||||||||||||||||||||||||
PowerShares FTSE RAFI Industrials Sector Portfolio | PRFN | 0.23282 | 0.27764 | 0.13831 | 0.07512 | 0.11650 | 0.21147 | ||||||||||||||||||||||||
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio | PRFQ | 0.09987 | 0.12257 | 0.08488 | 0.17094 | 0.09750 | 0.14861 | ||||||||||||||||||||||||
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio | PRFZ | 0.07196 | 0.25059 | 0.01258 | 0.11827 | 0.03020 | 0.14258 | ||||||||||||||||||||||||
PowerShares FTSE RAFI Utilities Sector Portfolio | PRFU | 0.03528 | 0.27320 | 0.59405 | 0.67368 | 0.26830 | 0.38618 |
31
Frequency Distribution of Discounts & Premiums
Since Inception through April 30, 2008
Closing Price Above NAV | |||||||||||||||||||||||||||||||||||||||
Ticker | Fund Name | Inception | Days | 0-24 Basis Points | 25-49 Basis Points | 50-99 Basis Points | 100-149 Basis Points | 150-199 Basis Points | 200+ Basis Points | ||||||||||||||||||||||||||||||
PRFM | PowerShares FTSE RAFI Basic Materials Sector Portfolio | 9/20/06 | 405 | 158 | — | — | — | — | — | ||||||||||||||||||||||||||||||
PRFG | PowerShares FTSE RAFI Consumer Goods Sector Portfolio | 9/20/06 | 405 | 179 | 6 | 1 | — | — | — | ||||||||||||||||||||||||||||||
PRFS | PowerShares FTSE RAFI Consumer Services Sector Portfolio | 9/20/06 | 405 | 170 | 4 | — | — | — | — | ||||||||||||||||||||||||||||||
PRFE | PowerShares FTSE RAFI Energy Sector Portfolio | 9/20/06 | 405 | 178 | 4 | — | — | — | — | ||||||||||||||||||||||||||||||
PRFF | PowerShares FTSE RAFI Financials Sector Portfolio | 9/20/06 | 405 | 179 | 3 | — | — | — | — | ||||||||||||||||||||||||||||||
PRFH | PowerShares FTSE RAFI Health Care Sector Portfolio | 9/20/06 | 405 | 190 | 6 | 2 | — | — | — | ||||||||||||||||||||||||||||||
PRFN | PowerShares FTSE RAFI Industrials Sector Portfolio | 9/20/06 | 405 | 175 | 5 | — | — | — | — | ||||||||||||||||||||||||||||||
PRFQ | PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio | 9/20/06 | 405 | 175 | 7 | 1 | — | — | — | ||||||||||||||||||||||||||||||
PRFZ | PowerShares FTSE RAFI US 1500 Small-Mid Portfolio | 9/20/06 | 405 | 166 | 4 | — | — | 1 | — | ||||||||||||||||||||||||||||||
PRFU | PowerShares FTSE RAFI Utilities Sector Portfolio | 9/20/06 | 405 | 149 | 6 | 2 | 1 | — | — |
32
Closing Price Below NAV | |||||||||||||||||||||||||||
Ticker | -0-24 Basis Points | -25-49 Basis Points | -50-99 Basis Points | -100-149 Basis Points | -150-199 Basis Points | -200+ Basis Points | |||||||||||||||||||||
PRFM | 244 | 3 | — | — | — | — | |||||||||||||||||||||
PRFG | 214 | 4 | 1 | — | — | — | |||||||||||||||||||||
PRFS | 229 | 2 | — | — | — | — | |||||||||||||||||||||
PRFE | 218 | 5 | — | — | — | — | |||||||||||||||||||||
PRFF | 216 | 7 | — | — | — | — | |||||||||||||||||||||
PRFH | 204 | 2 | 1 | — | — | — | |||||||||||||||||||||
PRFN | 223 | 2 | — | — | — | — | |||||||||||||||||||||
PRFQ | 220 | 2 | — | — | — | — | |||||||||||||||||||||
PRFZ | 226 | 8 | — | — | — | — | |||||||||||||||||||||
PRFU | 244 | 2 | 1 | — | — | — |
33
Fees and Expenses
As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, you incur Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month period ended April 30, 2008.
Actual Expenses
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, 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 first line under the heading "Expenses Paid During the Six-Month Period" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds' actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Funds' 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 Funds 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 tables are meant to highlight your ongoing costs only, and do not reflect any transactional costs such as sales charges (loads). Therefore the second line in the table 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 transactional costs were included, your costs would have been higher.
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares FTSE RAFI Basic Materials Sector Portfolio Actual | $1,000.00 | $960.40 | 0.70 | % | $3.41 | ||||||||||||||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.38 | 0.70 | % | $3.52 | ||||||||||||||
PowerShares FTSE RAFI Consumer Goods Sector Portfolio Actual | $1,000.00 | $888.55 | 0.70 | % | $3.29 | ||||||||||||||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.38 | 0.70 | % | $3.52 | ||||||||||||||
PowerShares FTSE RAFI Consumer Services Sector Portfolio Actual | $1,000.00 | $902.63 | 0.70 | % | $3.31 | ||||||||||||||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.38 | 0.70 | % | $3.52 | ||||||||||||||
PowerShares FTSE RAFI Energy Sector Portfolio Actual | $1,000.00 | $1,049.06 | 0.70 | % | $3.57 | ||||||||||||||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.38 | 0.70 | % | $3.52 |
34
Fees and Expenses (Continued)
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares FTSE RAFI Financials Sector Portfolio Actual | $1,000.00 | $821.06 | 0.70 | % | $3.17 | ||||||||||||||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.38 | 0.70 | % | $3.52 | ||||||||||||||
PowerShares FTSE RAFI Health Care Sector Portfolio Actual | $1,000.00 | $868.35 | 0.70 | % | $3.25 | ||||||||||||||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.38 | 0.70 | % | $3.52 | ||||||||||||||
PowerShares FTSE RAFI Industrials Sector Portfolio Actual | $1,000.00 | $925.95 | 0.70 | % | $3.35 | ||||||||||||||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.38 | 0.70 | % | $3.52 | ||||||||||||||
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio Actual | $1,000.00 | $829.70 | 0.70 | % | $3.18 | ||||||||||||||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.38 | 0.70 | % | $3.52 | ||||||||||||||
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio Actual | $1,000.00 | $874.00 | 0.70 | % | $3.26 | ||||||||||||||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.38 | 0.70 | % | $3.52 | ||||||||||||||
PowerShares FTSE RAFI Utilities Sector Portfolio Actual | $1,000.00 | $937.40 | 0.70 | % | $3.37 | ||||||||||||||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.38 | 0.70 | % | $3.52 |
(1) Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six months ended April 30, 2008. Expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 182 and then dividing the result by 366. Expense ratios for the most recent half-year may differ from expense ratios based on the one year data in the financial highlights.
35
Schedule of Investments
PowerShares FTSE RAFI Basic Materials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.1% | |||||||||||
Agricultural Chemicals—3.6% | |||||||||||
3,260 | Monsanto Co. | $ | 371,706 | ||||||||
887 | Mosaic (The) Co.* | 108,666 | |||||||||
480,372 | |||||||||||
Chemicals - Diversified—33.4% | |||||||||||
3,103 | Celanese Corp., Series A | 138,859 | |||||||||
45,032 | Dow Chemical (The) Co. | 1,808,034 | |||||||||
29,593 | E.I. du Pont de Nemours & Co. | 1,447,394 | |||||||||
1,227 | FMC Corp. | 77,031 | |||||||||
8,690 | Huntsman Corp. | 195,438 | |||||||||
3,597 | Olin Corp. | 72,551 | |||||||||
6,679 | PPG Industries, Inc. | 409,890 | |||||||||
2,213 | Rockwood Holdings, Inc.* | 81,682 | |||||||||
4,478 | Rohm & Haas Co. | 239,349 | |||||||||
1,153 | Westlake Chemical Corp. | 19,267 | |||||||||
4,489,495 | |||||||||||
Chemicals - Specialty—10.7% | |||||||||||
1,250 | Albemarle Corp. | 46,763 | |||||||||
6,184 | Ashland, Inc. | 327,875 | |||||||||
2,997 | Cabot Corp. | 87,393 | |||||||||
11,357 | Chemtura Corp. | 78,590 | |||||||||
1,325 | Cytec Industries, Inc. | 78,188 | |||||||||
3,483 | Eastman Chemical Co. | 256,000 | |||||||||
3,619 | Ecolab, Inc. | 166,329 | |||||||||
3,581 | Hercules, Inc. | 67,323 | |||||||||
2,024 | International Flavors & Fragrances, Inc. | 92,315 | |||||||||
2,047 | Lubrizol (The) Corp. | 119,381 | |||||||||
1,627 | Sigma-Aldrich Corp. | 92,772 | |||||||||
636 | Valhi, Inc. | 16,924 | |||||||||
1,429,853 | |||||||||||
Coal—3.6% | |||||||||||
1,409 | Arch Coal, Inc. | 80,820 | |||||||||
1,311 | Consol Energy, Inc. | 106,139 | |||||||||
1,316 | Foundation Coal Holdings, Inc. | 78,934 | |||||||||
1,459 | Massey Energy Co. | 76,349 | |||||||||
2,372 | Peabody Energy Corp. | 145,000 | |||||||||
487,242 | |||||||||||
Coatings/Paint—1.5% | |||||||||||
5,053 | RPM International, Inc. | 112,682 | |||||||||
4,109 | Valspar (The) Corp. | 90,316 | |||||||||
202,998 | |||||||||||
Forestry—6.0% | |||||||||||
12,565 | Weyerhaeuser Co. | 802,652 | |||||||||
Gold Mining—2.2% | |||||||||||
6,793 | Newmont Mining Corp. | 300,319 | |||||||||
Industrial Gases—7.0% | |||||||||||
4,747 | Air Products & Chemicals, Inc. | 467,247 | |||||||||
1,177 | Airgas, Inc. | 56,649 | |||||||||
4,623 | Praxair, Inc. | 422,126 | |||||||||
946,022 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Metal Processors & Fabricate—1.7% | |||||||||||
4,342 | Commercial Metals Co. | $ | 135,210 | ||||||||
5,128 | Worthington Industries, Inc. | 92,355 | |||||||||
227,565 | |||||||||||
Metal - Aluminum—6.8% | |||||||||||
26,297 | Alcoa, Inc. | 914,610 | |||||||||
Metal - Copper—1.0% | |||||||||||
1,221 | Southern Copper Corp. | 140,122 | |||||||||
Metal - Diversified—2.8% | |||||||||||
3,300 | Freeport-McMoRan Copper & Gold, Inc., Class B | 375,375 | |||||||||
Non-Ferrous Metals—0.3% | |||||||||||
9,302 | USEC, Inc.* | 43,161 | |||||||||
Office Supplies & Forms—1.5% | |||||||||||
4,037 | Avery Dennison Corp. | 194,543 | |||||||||
Paper & Related Products—6.7% | |||||||||||
8,853 | AbitibiBowater, Inc. | 87,379 | |||||||||
20,883 | Domtar Corp.* | 124,672 | |||||||||
26,204 | International Paper Co. | 685,758 | |||||||||
897,809 | |||||||||||
Steel - Producers—9.7% | |||||||||||
2,101 | AK Steel Holding Corp. | 131,901 | |||||||||
897 | Carpenter Technology Corp. | 45,998 | |||||||||
6,648 | Nucor Corp. | 501,924 | |||||||||
1,676 | Reliance Steel & Aluminum Co. | 101,867 | |||||||||
2,080 | Steel Dynamics, Inc. | 72,488 | |||||||||
2,882 | United States Steel Corp. | 443,684 | |||||||||
1,297,862 | |||||||||||
Steel - Specialty—0.6% | |||||||||||
1,232 | Allegheny Technologies, Inc. | 84,799 | |||||||||
Total Common Stocks (Cost $12,688,141) | 13,314,799 | ||||||||||
Money Market Fund—1.0% | |||||||||||
134,646 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $134,646) | 134,646 | |||||||||
Total Investments (Cost $12,822,787)—100.1% | 13,449,445 | ||||||||||
Liabilities in excess of other assets—(0.1%) | (15,714 | ) | |||||||||
Net Assets—100.0% | $ | 13,433,731 |
* Non-income producing security.
See Notes to Financial Statements.
36
Schedule of Investments
PowerShares FTSE RAFI Consumer Goods Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.2% | |||||||||||
Agriculture—17.7% | |||||||||||
8,509 | Altria Group, Inc. | $ | 170,179 | ||||||||
2,110 | Archer-Daniels-Midland Co. | 92,967 | |||||||||
432 | Bunge Ltd. | 49,287 | |||||||||
272 | Loews Corp. - Carolina Group | 17,862 | |||||||||
8,534 | Philip Morris International, Inc.* | 435,489 | |||||||||
723 | Reynolds American, Inc. | 38,934 | |||||||||
151 | Universal Corp. | 9,693 | |||||||||
497 | UST, Inc. | 25,879 | |||||||||
840,290 | |||||||||||
Apparel—1.7% | |||||||||||
758 | NIKE, Inc., Class B | 50,634 | |||||||||
297 | Timberland (The) Co., Class A* | 4,336 | |||||||||
373 | VF Corp. | 27,744 | |||||||||
82,714 | |||||||||||
Auto Manufacturers—13.7% | |||||||||||
51,309 | Ford Motor Co.* | 423,813 | |||||||||
9,722 | General Motors Corp. | 225,550 | |||||||||
649,363 | |||||||||||
Auto Parts & Equipment—6.4% | |||||||||||
354 | American Axle & Manufacturing Holdings, Inc. | 7,130 | |||||||||
1,294 | ArvinMeritor, Inc. | 19,332 | |||||||||
427 | Autoliv, Inc. | 26,149 | |||||||||
309 | BorgWarner, Inc. | 15,187 | |||||||||
416 | Cooper Tire & Rubber Co. | 5,466 | |||||||||
635 | Exide Technologies* | 9,265 | |||||||||
1,139 | Goodyear Tire & Rubber (The) Co.* | 30,502 | |||||||||
2,391 | Johnson Controls, Inc. | 84,308 | |||||||||
1,086 | Lear Corp.* | 31,027 | |||||||||
437 | Tenneco, Inc.* | 11,178 | |||||||||
1,247 | TRW Automotive Holdings Corp.* | 31,874 | |||||||||
5,835 | Visteon Corp.* | 25,324 | |||||||||
169 | WABCO Holdings, Inc. | 8,071 | |||||||||
304,813 | |||||||||||
Beverages—12.2% | |||||||||||
2,054 | Anheuser-Busch Cos., Inc. | 101,057 | |||||||||
187 | Brown-Forman Corp., Class B | 12,720 | |||||||||
2,670 | Coca-Cola (The) Co. | 157,182 | |||||||||
1,706 | Coca-Cola Enterprises, Inc. | 38,385 | |||||||||
1,183 | Constellation Brands, Inc., Class A* | 21,720 | |||||||||
502 | Molson Coors Brewing Co., Class B | 27,530 | |||||||||
711 | Pepsi Bottling Group (The), Inc. | 23,968 | |||||||||
395 | PepsiAmericas, Inc. | 10,152 | |||||||||
2,747 | PepsiCo, Inc. | 188,251 | |||||||||
580,965 | |||||||||||
Cosmetics/Personal Care—10.6% | |||||||||||
1,198 | Alberto-Culver Co. | 30,154 | |||||||||
871 | Avon Products, Inc. | 33,986 | |||||||||
832 | Colgate-Palmolive Co. | 58,822 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
491 | Estee Lauder (The) Cos., Class A | $ | 22,395 | ||||||||
5,321 | Procter & Gamble (The) Co. | 356,773 | |||||||||
502,130 | |||||||||||
Distribution/Wholesale—0.7% | |||||||||||
819 | Genuine Parts Co. | 34,775 | |||||||||
Electrical Components & Equipment—0.2% | |||||||||||
130 | Energizer Holdings, Inc.* | 10,278 | |||||||||
Electronics—0.1% | |||||||||||
125 | Garmin Ltd. | 5,113 | |||||||||
Food—17.7% | |||||||||||
879 | Campbell Soup Co. | 30,589 | |||||||||
341 | Chiquita Brands International, Inc.* | 7,758 | |||||||||
2,916 | ConAgra Foods, Inc. | 68,701 | |||||||||
229 | Corn Products International, Inc. | 10,621 | |||||||||
534 | Cosan Ltd., Class A* (Brazil) | 7,081 | |||||||||
1,598 | Dean Foods Co.* | 37,138 | |||||||||
1,120 | Del Monte Foods Co. | 10,102 | |||||||||
206 | Fresh Del Monte Produce, Inc.* | 6,528 | |||||||||
1,211 | General Mills, Inc. | 73,144 | |||||||||
1,122 | H.J. Heinz Co. | 52,768 | |||||||||
712 | Hershey (The) Co. | 26,615 | |||||||||
305 | Hormel Foods Corp. | 12,020 | |||||||||
213 | J.M. Smucker (The) Co. | 10,624 | |||||||||
815 | Kellogg Co. | 41,704 | |||||||||
7,014 | Kraft Foods, Inc., Class A | 221,852 | |||||||||
383 | McCormick & Co., Inc. | 14,474 | |||||||||
393 | Pilgrim's Pride Corp. | 9,499 | |||||||||
5,197 | Sara Lee Corp. | 75,408 | |||||||||
1 | Seaboard Corp. | 1,680 | |||||||||
1,034 | Smithfield Foods, Inc.* | 29,655 | |||||||||
3,685 | Tyson Foods, Inc., Class A | 65,593 | |||||||||
353 | Wm. Wrigley Jr. Co. | 26,884 | |||||||||
840,438 | |||||||||||
Hand/Machine Tools—0.9% | |||||||||||
246 | Black & Decker (The) Corp. | 16,145 | |||||||||
195 | Snap-On, Inc. | 11,565 | |||||||||
316 | Stanley Works (The) | 15,244 | |||||||||
42,954 | |||||||||||
Home Builders—6.6% | |||||||||||
1,742 | Beazer Homes USA, Inc.* | 19,284 | |||||||||
234 | Brookfield Homes Corp. | 3,683 | |||||||||
1,510 | Centex Corp. | 31,438 | |||||||||
3,150 | D.R. Horton, Inc. | 48,795 | |||||||||
1,522 | Hovnanian Enterprises, Inc., Class A* | 17,990 | |||||||||
991 | KB Home | 22,298 | |||||||||
1,689 | Lennar Corp., Class A | 31,111 | |||||||||
256 | M.D.C. Holdings, Inc. | 11,156 | |||||||||
442 | Meritage Homes Corp.* | 8,385 |
See Notes to Financial Statements.
37
Schedule of Investments (Continued)
PowerShares FTSE RAFI Consumer Goods Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
34 | NVR, Inc.* | $ | 20,859 | ||||||||
2,877 | Pulte Homes, Inc. | 37,517 | |||||||||
447 | Ryland Group, Inc. | 14,295 | |||||||||
2,608 | Standard-Pacific Corp. | 13,196 | |||||||||
173 | Thor Industries, Inc. | 5,245 | |||||||||
863 | Toll Brothers, Inc.* | 19,538 | |||||||||
2,046 | WCI Communities, Inc.* | 6,731 | |||||||||
311,521 | |||||||||||
Home Furnishings—1.1% | |||||||||||
560 | Furniture Brands International, Inc. | 7,588 | |||||||||
225 | Harman International Industries, Inc. | 9,196 | |||||||||
457 | Whirlpool Corp. | 33,260 | |||||||||
50,044 | |||||||||||
Household Products/Wares—3.0% | |||||||||||
424 | Clorox (The) Co. | 22,472 | |||||||||
345 | Jarden Corp.* | 7,355 | |||||||||
1,469 | Kimberly-Clark Corp. | 94,002 | |||||||||
275 | Scotts Miracle-Gro (The) Co., Class A | 9,114 | |||||||||
181 | Tupperware Brands Corp. | 7,131 | |||||||||
140,074 | |||||||||||
Housewares—0.6% | |||||||||||
1,387 | Newell Rubbermaid, Inc. | 28,475 | |||||||||
Leisure Time—1.2% | |||||||||||
1,003 | Brunswick Corp. | 16,730 | |||||||||
797 | Harley-Davidson, Inc. | 30,485 | |||||||||
160 | Polaris Industries, Inc. | 7,448 | |||||||||
54,663 | |||||||||||
Machinery - Diversified—0.1% | |||||||||||
455 | Briggs & Stratton Corp. | 6,925 | |||||||||
Miscellaneous Manufacturing—1.5% | |||||||||||
2,731 | Eastman Kodak Co. | 48,857 | |||||||||
1,246 | Leggett & Platt, Inc. | 20,684 | |||||||||
69,541 | |||||||||||
Office Furnishings—0.2% | |||||||||||
247 | HNI Corp. | 5,377 | |||||||||
507 | Steelcase, Inc., Class A | 5,618 | |||||||||
10,995 | |||||||||||
Pharmaceuticals—0.1% | |||||||||||
212 | NBTY, Inc.* | 5,968 | |||||||||
Retail—1.7% | |||||||||||
453 | Coach, Inc.* | 16,113 | |||||||||
751 | Hanesbrands, Inc.* | 26,300 | |||||||||
953 | Jones Apparel Group, Inc. | 15,086 | |||||||||
871 | Liz Claiborne, Inc. | 15,408 | |||||||||
703 | Quiksilver, Inc.* | 6,840 | |||||||||
79,747 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Software—0.7% | |||||||||||
286 | Activision, Inc.* | $ | 7,736 | ||||||||
456 | Electronic Arts, Inc.* | 23,471 | |||||||||
31,207 | |||||||||||
Textiles—0.6% | |||||||||||
387 | Mohawk Industries, Inc.* | 29,486 | |||||||||
Toys/Games/Hobbies—0.9% | |||||||||||
452 | Hasbro, Inc. | 16,073 | |||||||||
1,311 | Mattel, Inc. | 24,581 | |||||||||
40,654 | |||||||||||
Total Common Stocks (Cost $5,119,578) | 4,753,133 | ||||||||||
Money Market Fund—3.0% | |||||||||||
141,879 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $141,879) | 141,879 | |||||||||
Total Investments (Cost $5,261,457)—103.2% | 4,895,012 | ||||||||||
Liabilities in excess of other assets—(3.2%) | (149,664 | ) | |||||||||
Net Assets—100.0% | $ | 4,745,348 |
* Non-income producing security.
See Notes to Financial Statements.
38
Schedule of Investments
PowerShares FTSE RAFI Consumer Services Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—98.2% | |||||||||||
Advertising—1.5% | |||||||||||
533 | Clear Channel Outdoor Holdings, Inc., Class A* | $ | 10,138 | ||||||||
123 | Getty Images, Inc.* | 4,016 | |||||||||
1,487 | Interpublic Group of Cos., Inc.* | 13,457 | |||||||||
199 | Lamar Advertising Co., Class A* | 7,868 | |||||||||
727 | Omnicom Group, Inc. | 34,707 | |||||||||
70,186 | |||||||||||
Airlines—1.7% | |||||||||||
276 | Alaska Air Group, Inc.* | 5,928 | |||||||||
2,454 | AMR Corp.* | 21,522 | |||||||||
793 | Continental Airlines, Inc., Class B* | 14,258 | |||||||||
775 | JetBlue Airways Corp.* | 3,906 | |||||||||
250 | SkyWest, Inc. | 4,758 | |||||||||
1,981 | Southwest Airlines Co. | 26,228 | |||||||||
335 | US Airways Group, Inc.* | 2,878 | |||||||||
79,478 | |||||||||||
Commercial Services—4.9% | |||||||||||
151 | Apollo Group, Inc., Class A* | 7,686 | |||||||||
1,931 | Avis Budget Group, Inc.* | 25,644 | |||||||||
445 | Career Education Corp.* | 8,967 | |||||||||
552 | Dollar Thrifty Automotive Group* | 7,281 | |||||||||
1,045 | H&R Block, Inc. | 22,854 | |||||||||
3,327 | Hertz Global Holdings, Inc.* | 42,785 | |||||||||
564 | Live Nation, Inc.* | 7,778 | |||||||||
1,683 | McKesson Corp. | 87,717 | |||||||||
694 | Rent-A-Center, Inc.* | 14,942 | |||||||||
614 | Service Corp. International | 6,822 | |||||||||
432 | TravelCenters of America LLC* | 1,395 | |||||||||
233,871 | |||||||||||
Distribution/Wholesale—0.1% | |||||||||||
212 | Core-Mark Holding Co., Inc.* | 6,076 | |||||||||
Entertainment—1.0% | |||||||||||
350 | International Game Technology | 12,159 | |||||||||
141 | Penn National Gaming, Inc.* | 6,024 | |||||||||
1,153 | Regal Entertainment Group, Class A | 21,861 | |||||||||
664 | Warner Music Group Corp. | 5,770 | |||||||||
45,814 | |||||||||||
Food—7.1% | |||||||||||
247 | Great Atlantic & Pacific Tea Co., Inc.* | 6,797 | |||||||||
3,577 | Kroger (The) Co. | 97,474 | |||||||||
161 | Nash Finch Co. | 5,889 | |||||||||
314 | Performance Food Group Co.* | 10,506 | |||||||||
146 | Ruddick Corp. | 5,650 | |||||||||
2,178 | Safeway, Inc. | 68,825 | |||||||||
1,636 | SUPERVALU, Inc. | 54,152 | |||||||||
2,244 | Sysco Corp. | 68,599 | |||||||||
65 | Weis Markets, Inc. | 1,996 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
415 | Whole Foods Market, Inc. | $ | 13,546 | ||||||||
396 | Winn-Dixie Stores, Inc.* | 7,021 | |||||||||
340,455 | |||||||||||
Household Products/Wares—0.1% | |||||||||||
261 | American Greetings Corp., Class A | 4,672 | |||||||||
Internet—3.1% | |||||||||||
161 | Amazon.com, Inc.* | 12,659 | |||||||||
1,077 | eBay, Inc.* | 33,699 | |||||||||
915 | Expedia, Inc.* | 23,113 | |||||||||
1,676 | IAC/InterActiveCorp* | 34,878 | |||||||||
2,884 | Liberty Media Corp. Interactive, Series A* | 43,635 | |||||||||
147,984 | |||||||||||
Leisure Time—1.5% | |||||||||||
1,448 | Carnival Corp. (Panama) | 58,166 | |||||||||
517 | Royal Caribbean Cruises Ltd. (Liberia) | 16,492 | |||||||||
74,658 | |||||||||||
Lodging—1.7% | |||||||||||
251 | Boyd Gaming Corp. | 4,706 | |||||||||
29 | Las Vegas Sands Corp.* | 2,210 | |||||||||
638 | Marriott International, Inc., Class A | 21,883 | |||||||||
207 | MGM MIRAGE* | 10,588 | |||||||||
462 | Starwood Hotels & Resorts Worldwide, Inc. | 24,122 | |||||||||
841 | Wyndham Worldwide Corp. | 18,065 | |||||||||
81,574 | |||||||||||
Media—23.3% | |||||||||||
708 | Belo Corp., Class A | 7,151 | |||||||||
1,143 | Cablevision Systems Corp., Class A* | 26,289 | |||||||||
3,329 | CBS Corp., Class B | 76,800 | |||||||||
9,650 | Charter Communications, Inc., Class A* | 10,326 | |||||||||
1,351 | Clear Channel Communications, Inc. | 40,733 | |||||||||
5,587 | Comcast Corp., Class A | 114,813 | |||||||||
2,887 | Comcast Corp., Special Class A | 58,433 | |||||||||
1,203 | DIRECTV Group (The), Inc.* | 29,642 | |||||||||
812 | Discovery Holding Co., Class A* | 18,806 | |||||||||
732 | DISH Network Corp., Class A* | 21,843 | |||||||||
219 | E.W. Scripps Co., Class A | 9,835 | |||||||||
1,554 | Gannett Co., Inc. | 44,475 | |||||||||
83 | Hearst-Argyle Television, Inc. | 1,720 | |||||||||
547 | Lee Enterprises, Inc. | 4,228 | |||||||||
1,052 | Liberty Media Corp. - Entertainment, Class A* | 27,299 | |||||||||
488 | Liberty Global, Inc., Series A* | 17,270 | |||||||||
504 | Liberty Global, Inc., Series C* | 16,733 | |||||||||
260 | Liberty Media Corp. - Capital, Series A* | 3,996 | |||||||||
963 | McClatchy Co., Class A | 10,112 | |||||||||
772 | McGraw-Hill (The) Cos., Inc. | 31,644 | |||||||||
84 | Meredith Corp. | 2,722 | |||||||||
653 | New York Times (The) Co., Class A | 12,734 | |||||||||
6,095 | News Corp., Class A | 109,101 | |||||||||
1,249 | News Corp., Class B | 23,107 |
See Notes to Financial Statements.
39
Schedule of Investments (Continued)
PowerShares FTSE RAFI Consumer Services Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
820 | R.H. Donnelley Corp.* | $ | 3,928 | ||||||||
143 | Scholastic Corp.* | 4,025 | |||||||||
13,188 | Time Warner, Inc. | 195,841 | |||||||||
702 | Time Warner Cable, Inc., Class A* | 19,656 | |||||||||
914 | Viacom, Inc., Class B* | 35,134 | |||||||||
4,162 | Walt Disney (The) Co. | 134,973 | |||||||||
6 | Washington Post (The) Co., Class B | 3,934 | |||||||||
1,117,303 | |||||||||||
Pharmaceuticals—3.4% | |||||||||||
1,488 | AmerisourceBergen Corp. | 60,338 | |||||||||
1,729 | Cardinal Health, Inc. | 90,029 | |||||||||
631 | Omnicare, Inc. | 12,841 | |||||||||
163,208 | |||||||||||
Retail—48.7% | |||||||||||
120 | Abercrombie & Fitch Co., Class A | 8,917 | |||||||||
112 | Advance Auto Parts, Inc. | 3,884 | |||||||||
272 | American Eagle Outfitters, Inc. | 4,997 | |||||||||
276 | AnnTaylor Stores Corp.* | 6,983 | |||||||||
519 | Asbury Automotive Group, Inc. | 8,641 | |||||||||
1,868 | AutoNation, Inc.* | 29,907 | |||||||||
112 | AutoZone, Inc.* | 13,524 | |||||||||
240 | Barnes & Noble, Inc. | 7,747 | |||||||||
683 | Bed Bath & Beyond, Inc.* | 22,198 | |||||||||
1,284 | Best Buy Co., Inc. | 55,238 | |||||||||
585 | Big Lots, Inc.* | 15,813 | |||||||||
441 | BJ's Wholesale Club, Inc.* | 16,811 | |||||||||
3,864 | Blockbuster, Inc., Class A* | 11,283 | |||||||||
2,287 | Blockbuster, Inc., Class B* | 5,329 | |||||||||
812 | Borders Group, Inc. | 5,116 | |||||||||
463 | Brinker International, Inc. | 10,505 | |||||||||
234 | Burger King Holdings, Inc. | 6,529 | |||||||||
638 | CarMax, Inc.* | 13,239 | |||||||||
209 | Casey's General Stores, Inc. | 4,625 | |||||||||
1,253 | Charming Shoppes, Inc.* | 6,465 | |||||||||
572 | Chico's FAS, Inc.* | 4,044 | |||||||||
3,651 | Circuit City Stores, Inc. | 17,306 | |||||||||
438 | Collective Brands, Inc.* | 5,418 | |||||||||
1,376 | Costco Wholesale Corp. | 98,039 | |||||||||
1,597 | CVS Caremark Corp. | 64,471 | |||||||||
420 | Darden Restaurants, Inc. | 14,944 | |||||||||
152 | Dick's Sporting Goods, Inc.* | 4,347 | |||||||||
960 | Dillard's, Inc., Class A | 19,584 | |||||||||
379 | Dollar Tree, Inc.* | 11,976 | |||||||||
704 | Family Dollar Stores, Inc. | 15,066 | |||||||||
1,118 | Foot Locker, Inc. | 14,143 | |||||||||
195 | GameStop Corp., Class A* | 10,733 | |||||||||
1,495 | Gap (The), Inc. | 27,837 | |||||||||
294 | Group 1 Automotive, Inc. | 7,844 | |||||||||
7,862 | Home Depot (The), Inc. | 226,425 | |||||||||
906 | J. C. Penney Co., Inc. | 38,505 | |||||||||
220 | Jack in the Box, Inc.* | 5,885 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
918 | Kohl's Corp.* | $ | 44,844 | ||||||||
2,322 | Limited Brands, Inc. | 43,003 | |||||||||
165 | Longs Drug Stores Corp. | 6,610 | |||||||||
4,049 | Lowe's Cos., Inc. | 101,993 | |||||||||
2,440 | Macy's, Inc. | 61,708 | |||||||||
1,885 | McDonald's Corp. | 112,307 | |||||||||
487 | Nordstrom, Inc. | 17,172 | |||||||||
2,668 | Office Depot, Inc.* | 33,830 | |||||||||
814 | OfficeMax, Inc. | 14,872 | |||||||||
309 | O'Reilly Automotive, Inc.* | 8,921 | |||||||||
268 | Pantry (The), Inc.* | 2,908 | |||||||||
371 | Penske Automotive Group, Inc. | 7,765 | |||||||||
349 | PetSmart, Inc. | 7,811 | |||||||||
173 | Polo Ralph Lauren Corp. | 10,745 | |||||||||
614 | RadioShack Corp. | 8,535 | |||||||||
228 | Regis Corp. | 6,658 | |||||||||
8,587 | Rite Aid Corp.* | 23,185 | |||||||||
346 | Ross Stores, Inc. | 11,588 | |||||||||
1,381 | Saks, Inc.* | 17,967 | |||||||||
631 | Sears Holdings Corp.* | 62,223 | |||||||||
620 | Sonic Automotive, Inc., Class A | 12,580 | |||||||||
1,528 | Staples, Inc. | 33,158 | |||||||||
1,238 | Starbucks Corp.* | 20,093 | |||||||||
264 | Talbots (The), Inc. | 2,120 | |||||||||
2,217 | Target Corp. | 117,788 | |||||||||
235 | Tiffany & Co. | 10,232 | |||||||||
949 | TJX (The) Cos., Inc. | 30,577 | |||||||||
2,450 | Walgreen Co. | 85,382 | |||||||||
8,956 | Wal-Mart Stores, Inc. | 519,268 | |||||||||
389 | Wendy's International, Inc. | 11,281 | |||||||||
327 | Williams-Sonoma, Inc. | 8,633 | |||||||||
672 | Yum! Brands, Inc. | 27,337 | |||||||||
315 | Zale Corp.* | 6,527 | |||||||||
2,333,939 | |||||||||||
Trucking & Leasing—0.1% | |||||||||||
105 | AMERCO, Inc.* | 6,030 | |||||||||
Total Common Stocks (Cost $5,461,843) | 4,705,248 | ||||||||||
Money Market Fund—1.8% | |||||||||||
85,803 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $85,803) | 85,803 | |||||||||
Total Investments (Cost $5,547,646)—100.0% | 4,791,051 | ||||||||||
Liabilities in excess of other assets—(0.0%) | (1,717 | ) | |||||||||
Net Assets—100.0% | $ | 4,789,334 |
* Non-income producing security.
See Notes to Financial Statements.
40
Schedule of Investments
PowerShares FTSE RAFI Energy Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.7% | |||||||||||
Electric - Integrated—0.6% | |||||||||||
4,207 | OGE Energy Corp. | $ | 137,527 | ||||||||
Oil Companies - Exploration & Production—20.6% | |||||||||||
8,942 | Anadarko Petroleum Corp. | 595,180 | |||||||||
4,470 | Apache Corp. | 602,020 | |||||||||
6,948 | Chesapeake Energy Corp. | 359,212 | |||||||||
1,469 | Cimarex Energy Co. | 91,519 | |||||||||
1,547 | Denbury Resources, Inc.* | 47,276 | |||||||||
6,508 | Devon Energy Corp. | 738,006 | |||||||||
1,777 | EOG Resources, Inc. | 231,863 | |||||||||
1,547 | Forest Oil Corp.* | 91,165 | |||||||||
2,664 | Newfield Exploration Co.* | 161,865 | |||||||||
1,796 | Noble Energy, Inc. | 156,252 | |||||||||
11,206 | Occidental Petroleum Corp. | 932,450 | |||||||||
2,608 | PetroHawk Energy Corp.* | 61,653 | |||||||||
2,335 | Pioneer Natural Resources Co. | 134,800 | |||||||||
1,082 | Plains Exploration & Production Co.* | 67,387 | |||||||||
3,200 | Southwestern Energy Co.* | 135,392 | |||||||||
1,001 | Stone Energy Corp.* | 61,001 | |||||||||
948 | Unit Corp.* | 60,207 | |||||||||
733 | Whiting Petroleum Corp.* | 56,089 | |||||||||
3,781 | XTO Energy, Inc. | 233,893 | |||||||||
4,817,230 | |||||||||||
Oil Companies - Integrated—55.1% | |||||||||||
37,080 | Chevron Corp. | 3,565,242 | |||||||||
35,343 | ConocoPhillips | 3,044,799 | |||||||||
50,781 | Exxon Mobil Corp. | 4,726,189 | |||||||||
3,955 | Hess Corp. | 420,021 | |||||||||
19,183 | Marathon Oil Corp. | 874,169 | |||||||||
2,822 | Murphy Oil Corp. | 254,939 | |||||||||
12,885,359 | |||||||||||
Oil Field Machinery & Equipment—1.7% | |||||||||||
1,967 | Cameron International Corp.* | 96,835 | |||||||||
1,183 | FMC Technologies, Inc.* | 79,498 | |||||||||
3,333 | National Oilwell Varco, Inc.* | 228,144 | |||||||||
404,477 | |||||||||||
Oil Refining & Marketing—6.0% | |||||||||||
928 | Alon USA Energy, Inc. | 12,946 | |||||||||
1,267 | CVR Energy, Inc.* | 27,279 | |||||||||
1,297 | Frontier Oil Corp. | 32,230 | |||||||||
5,888 | Sunoco, Inc. | 273,262 | |||||||||
5,441 | Tesoro Corp. | 136,787 | |||||||||
18,635 | Valero Energy Corp. | 910,319 | |||||||||
1,392,823 | |||||||||||
Oil & Gas Drilling—3.5% | |||||||||||
432 | Diamond Offshore Drilling, Inc. | 54,177 | |||||||||
1,514 | ENSCO International, Inc. | 96,487 | |||||||||
1,435 | Helmerich & Payne, Inc. | 77,131 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
5,322 | Nabors Industries, Ltd. (Bermuda)* | $ | 199,787 | ||||||||
1,907 | Noble Corp. | 107,326 | |||||||||
2,939 | Patterson-UTI Energy, Inc. | 82,116 | |||||||||
3,159 | Pride International, Inc.* | 134,100 | |||||||||
1,426 | Rowan Cos., Inc. | 55,600 | |||||||||
806,724 | |||||||||||
Oil - Field Services—10.6% | |||||||||||
3,952 | Baker Hughes, Inc. | 319,638 | |||||||||
5,285 | BJ Services Co. | 149,407 | |||||||||
12,435 | Halliburton Co. | 570,891 | |||||||||
1,627 | Helix Energy Solutions Group, Inc.* | 56,213 | |||||||||
7,320 | Schlumberger Ltd. | 736,026 | |||||||||
548 | SEACOR Holdings, Inc.* | 46,640 | |||||||||
1,886 | Smith International, Inc. | 144,298 | |||||||||
1,320 | Transocean, Inc. | 194,647 | |||||||||
3,321 | Weatherford International Ltd.* | 267,905 | |||||||||
2,485,665 | |||||||||||
Pipelines—1.3% | |||||||||||
17,631 | El Paso Corp. | 302,195 | |||||||||
Transport - Marine—0.3% | |||||||||||
1,110 | Tidewater, Inc. | 72,394 | |||||||||
Total Common Stocks (Cost $20,934,449) | 23,304,394 | ||||||||||
Money Market Fund—0.5% | |||||||||||
103,433 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $103,433) | 103,433 | |||||||||
Total Investments (Cost $21,037,882)—100.2% | 23,407,827 | ||||||||||
Liabilities in excess of other assets—(0.2%) | (35,344 | ) | |||||||||
Net Assets—100.0% | $ | 23,372,483 |
* Non-income producing security.
See Notes to Financial Statements.
41
Schedule of Investments
PowerShares FTSE RAFI Financials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests—99.9% | |||||||||||
Commercial Banks - Central U.S.—0.9% | |||||||||||
1,301 | Associated Banc-Corp | $ | 36,780 | ||||||||
84 | BOK Financial Corp. | 4,796 | |||||||||
1,401 | Citizens Republic Bancorp, Inc. | 11,558 | |||||||||
516 | Commerce Bancshares, Inc. | 22,446 | |||||||||
358 | Cullen/Frost Bankers, Inc. | 19,984 | |||||||||
1,072 | FirstMerit Corp. | 21,997 | |||||||||
3,178 | Marshall & Ilsley Corp. | 79,387 | |||||||||
1,443 | TCF Financial Corp. | 25,108 | |||||||||
222,056 | |||||||||||
Commercial Banks - Eastern U.S.—0.6% | |||||||||||
1,851 | Fulton Financial Corp. | 23,082 | |||||||||
885 | M&T Bank Corp. | 82,509 | |||||||||
1,091 | Valley National Bancorp | 20,936 | |||||||||
759 | Webster Financial Corp. | 19,772 | |||||||||
146,299 | |||||||||||
Commercial Banks - Southern U.S.—2.6% | |||||||||||
727 | BancorpSouth, Inc. | 17,470 | |||||||||
6,212 | BB&T Corp. | 213,008 | |||||||||
2,149 | Colonial BancGroup (The), Inc. | 17,493 | |||||||||
3,083 | First Horizon National Corp. | 33,296 | |||||||||
4,797 | Popular, Inc. | 59,819 | |||||||||
8,341 | Regions Financial Corp. | 182,835 | |||||||||
1,173 | South Financial Group (The), Inc. | 7,085 | |||||||||
5,343 | Synovus Financial Corp. | 63,261 | |||||||||
702 | Trustmark Corp. | 15,290 | |||||||||
655 | Whitney Holding Corp. | 15,334 | |||||||||
624,891 | |||||||||||
Commercial Banks - Western U.S.—0.5% | |||||||||||
345 | Bank of Hawaii Corp. | 18,916 | |||||||||
426 | City National Corp. | 20,670 | |||||||||
553 | UnionBanCal Corp. | 29,038 | |||||||||
1,082 | Zions Bancorp | 50,151 | |||||||||
118,775 | |||||||||||
Commercial Service - Finance—0.3% | |||||||||||
438 | Equifax, Inc. | 16,762 | |||||||||
130 | Mastercard, Inc., Class A | 36,161 | |||||||||
612 | Moody's Corp. | 22,620 | |||||||||
75,543 | |||||||||||
Fiduciary Banks—1.5% | |||||||||||
3,969 | Bank of New York Mellon (The) Corp. | 172,771 | |||||||||
894 | Northern Trust Corp. | 66,254 | |||||||||
1,296 | State Street Corp. | 93,493 | |||||||||
636 | Wilmington Trust Corp. | 20,912 | |||||||||
353,430 | |||||||||||
Finance - Auto Loans—0.1% | |||||||||||
2,495 | AmeriCredit Corp.* | 34,830 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Finance - Commercial—0.2% | |||||||||||
4,314 | CIT Group, Inc. | $ | 46,979 | ||||||||
Finance - Consumer Loans—0.4% | |||||||||||
5,037 | SLM Corp.* | 93,336 | |||||||||
41 | Student Loan Corp. | 5,214 | |||||||||
98,550 | |||||||||||
Finance - Credit Card—1.9% | |||||||||||
6,958 | American Express Co. | 334,124 | |||||||||
717 | CompuCredit Corp.* | 5,793 | |||||||||
6,567 | Discover Financial Services | 119,585 | |||||||||
459,502 | |||||||||||
Finance - Investment Banker—25.0% | |||||||||||
1,617 | Bear Stearns (The) Cos., Inc. | 17,350 | |||||||||
3,191 | Charles Schwab (The) Corp. | 68,926 | |||||||||
93,520 | Citigroup, Inc. | 2,363,249 | |||||||||
13,045 | E*TRADE Financial Corp.* | 51,919 | |||||||||
8,716 | Friedman Billings Ramsey Group, Inc., Class A | 21,703 | |||||||||
2,428 | Goldman Sachs Group (The), Inc. | 464,646 | |||||||||
830 | Interactive Brokers Group, Inc., Class A* | 26,203 | |||||||||
710 | Jefferies Group, Inc. | 13,348 | |||||||||
33,709 | JPMorgan Chase & Co. | 1,606,234 | |||||||||
4,603 | Lehman Brothers Holdings, Inc. | 203,637 | |||||||||
8,749 | Merrill Lynch & Co., Inc. | 435,963 | |||||||||
12,495 | Morgan Stanley | 607,257 | |||||||||
951 | Raymond James Financial, Inc. | 27,360 | |||||||||
2,139 | TD Ameritrade Holding Corp.* | 38,716 | |||||||||
5,946,511 | |||||||||||
Finance - Mortgage Loan/Banker—4.7% | |||||||||||
27,573 | Countrywide Financial Corp. | 159,372 | |||||||||
19,485 | Fannie Mae | 551,425 | |||||||||
15,559 | Freddie Mac | 387,575 | |||||||||
4,570 | IndyMac Bancorp, Inc. | 14,853 | |||||||||
4,836 | Thornburg Mortgage, Inc. | 5,900 | |||||||||
1,119,125 | |||||||||||
Finance - Other Services—0.3% | |||||||||||
41 | CME Group, Inc. | 18,755 | |||||||||
1,219 | MF Global Ltd.* | 16,054 | |||||||||
563 | Nasdaq OMX (The) Group, Inc.* | 20,522 | |||||||||
85 | Nymex Holdings, Inc. | 7,871 | |||||||||
238 | NYSE Euronext | 15,732 | |||||||||
78,934 | |||||||||||
Financial Guarantee Insurance—0.9% | |||||||||||
12,730 | AMBAC Financial Group, Inc. | 58,940 | |||||||||
5,235 | MBIA, Inc. | 54,444 | |||||||||
3,610 | MGIC Investment Corp. | 47,038 |
See Notes to Financial Statements.
42
Schedule of Investments (Continued)
PowerShares FTSE RAFI Financials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
3,514 | PMI Group (The), Inc. | $ | 19,784 | ||||||||
4,166 | Radian Group, Inc. | 22,496 | |||||||||
202,702 | |||||||||||
Forestry—0.2% | |||||||||||
1,261 | Plum Creek Timber Co., Inc. | 51,499 | |||||||||
Insurance Brokers—1.2% | |||||||||||
2,003 | AON Corp. | 90,916 | |||||||||
816 | Arthur J. Gallagher & Co. | 20,049 | |||||||||
128 | Erie Indemnity Co., Class A | 6,838 | |||||||||
5,366 | Marsh & McLennan Cos., Inc. | 148,048 | |||||||||
708 | Willis Group Holdings Ltd. | 24,603 | |||||||||
290,454 | |||||||||||
Investment Management/ Advisory Service—1.2% | |||||||||||
1,605 | Ameriprise Financial, Inc. | 76,221 | |||||||||
285 | Federated Investors, Inc., Class B | 9,542 | |||||||||
706 | Franklin Resources, Inc. | 67,176 | |||||||||
750 | Janus Capital Group, Inc. | 21,045 | |||||||||
775 | Legg Mason, Inc. | 46,717 | |||||||||
1,458 | Och-Ziff Capital Management Group LLC, Class A | 28,300 | |||||||||
707 | T. Rowe Price Group, Inc. | 41,402 | |||||||||
290,403 | |||||||||||
Investment Companies—0.5% | |||||||||||
2,405 | Allied Capital Corp. | 48,340 | |||||||||
1,459 | American Capital Strategies Ltd. | 46,323 | |||||||||
1,120 | Apollo Investment Corp. | 18,122 | |||||||||
112,785 | |||||||||||
Life/Health Insurance—4.0% | |||||||||||
1,915 | AFLAC, Inc. | 127,673 | |||||||||
4,230 | Conseco, Inc.* | 49,280 | |||||||||
2,209 | Lincoln National Corp. | 118,756 | |||||||||
1,366 | Nationwide Financial Services, Inc., Class A | 68,464 | |||||||||
1,836 | Phoenix (The) Cos., Inc. | 23,868 | |||||||||
1,698 | Principal Financial Group, Inc. | 91,115 | |||||||||
754 | Protective Life Corp. | 32,135 | |||||||||
3,718 | Prudential Financial, Inc. | 281,490 | |||||||||
231 | Reinsurance Group of America, Inc. | 12,007 | |||||||||
388 | StanCorp Financial Group, Inc. | 19,881 | |||||||||
708 | Torchmark Corp. | 45,836 | |||||||||
3,615 | Unum Group | 83,904 | |||||||||
954,409 | |||||||||||
Multi-line Insurance—12.2% | |||||||||||
2,445 | ACE Ltd. | 147,409 | |||||||||
6,730 | Allstate (The) Corp. | 338,923 | |||||||||
686 | American Financial Group, Inc. | 18,810 | |||||||||
25,220 | American International Group, Inc. | 1,165,164 | |||||||||
75 | American National Insurance | 8,384 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
798 | Assurant, Inc. | $ | 51,870 | ||||||||
1,904 | Cincinnati Financial Corp. | 68,354 | |||||||||
219 | CNA Financial Corp. | 5,871 | |||||||||
5,582 | Genworth Financial, Inc., Class A | 128,721 | |||||||||
396 | Hanover Insurance Group (The), Inc. | 17,772 | |||||||||
3,506 | Hartford Financial Services Group (The), Inc. | 249,873 | |||||||||
854 | HCC Insurance Holdings, Inc. | 21,077 | |||||||||
3,827 | Loews Corp. | 161,155 | |||||||||
5,681 | MetLife, Inc. | 345,689 | |||||||||
4,052 | Old Republic International Corp. | 58,146 | |||||||||
782 | Unitrin, Inc. | 29,669 | |||||||||
2,887 | XL Capital Ltd., Class A | 100,727 | |||||||||
2,917,614 | |||||||||||
Paper & Related Products—0.2% | |||||||||||
557 | Potlatch Corp. | 24,959 | |||||||||
566 | Rayonier, Inc. | 23,789 | |||||||||
48,748 | |||||||||||
Property/Casualty Insurance—4.4% | |||||||||||
40 | Alleghany Corp.* | 13,780 | |||||||||
378 | Arch Capital Group Ltd.* | 26,706 | |||||||||
3,059 | Chubb (The) Corp. | 162,035 | |||||||||
386 | Commerce Group (The), Inc. | 14,066 | |||||||||
6,453 | Fidelity National Title Group, Inc., Class A | 103,183 | |||||||||
1,447 | First American (The) Corp. | 47,462 | |||||||||
554 | LandAmerica Financial Group, Inc. | 15,900 | |||||||||
60 | Markel Corp.* | 26,064 | |||||||||
295 | Mercury General Corp. | 14,718 | |||||||||
1,193 | OneBeacon Insurance Group Ltd. | 23,454 | |||||||||
396 | Philadelphia Consolidated Holding Corp.* | 14,604 | |||||||||
5,332 | Progressive (The) Corp. | 96,989 | |||||||||
1,315 | SAFECO Corp. | 87,763 | |||||||||
562 | Selective Insurance Group, Inc. | 11,982 | |||||||||
6,085 | Travelers (The) Cos., Inc. | 306,684 | |||||||||
1,324 | W.R. Berkley Corp. | 34,014 | |||||||||
7 | Wesco Financial Corp. | 3,031 | |||||||||
83 | White Mountains Insurance Group Ltd. | 39,516 | |||||||||
1,041,951 | |||||||||||
Real Estate Management/Service—0.1% | |||||||||||
834 | CB Richard Ellis Group, Inc., Class A* | 19,282 | |||||||||
Reinsurance—4.4% | |||||||||||
647 | Allied World Assurance Holdings Ltd. (Bermuda) | 26,676 | |||||||||
546 | Aspen Insurance Holdings Ltd. (Bermuda) | 14,191 | |||||||||
987 | Axis Capital Holdings Ltd. (Bermuda) | 33,469 | |||||||||
178 | Berkshire Hathaway, Inc., Class B* | 793,345 | |||||||||
553 | Endurance Specialty Holdings Ltd. (Bermuda) | 20,533 |
See Notes to Financial Statements.
43
Schedule of Investments (Continued)
PowerShares FTSE RAFI Financials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
429 | Everest Re Group Ltd. | $ | 38,760 | ||||||||
450 | IPC Holdings Ltd. | 13,100 | |||||||||
1,475 | Montpelier Re Holdings Ltd. (Bermuda) | 24,338 | |||||||||
205 | Odyssey Re Holdings Corp. | 7,335 | |||||||||
503 | PartnerRe Ltd. | 37,212 | |||||||||
366 | Platinum Underwriters Holdings Ltd. | 13,128 | |||||||||
439 | RenaissanceRe Holdings Ltd. (Bermuda) | 22,582 | |||||||||
160 | Transatlantic Holdings, Inc. | 10,376 | |||||||||
1,055,045 | |||||||||||
REITS - Apartments—1.2% | |||||||||||
1,336 | Apartment Investment & Management Co., Class A | 49,405 | |||||||||
429 | AvalonBay Communities, Inc. | 42,793 | |||||||||
403 | BRE Properties, Inc. | 19,324 | |||||||||
513 | Camden Property Trust | 27,143 | |||||||||
2,404 | Equity Residential | 99,813 | |||||||||
323 | Home Properties, Inc. | 16,980 | |||||||||
348 | Post Properties, Inc. | 12,772 | |||||||||
1,163 | UDR, Inc. | 29,401 | |||||||||
297,631 | |||||||||||
REITS - Diversified—1.3% | |||||||||||
1,449 | CapitalSource, Inc. | 20,358 | |||||||||
771 | Colonial Properties Trust | 18,681 | |||||||||
787 | Cousins Properties, Inc. | 19,998 | |||||||||
2,017 | Duke Realty Corp. | 49,255 | |||||||||
2,659 | iStar Financial, Inc. | 51,186 | |||||||||
1,239 | Liberty Property Trust | 43,402 | |||||||||
1,024 | Vornado Realty Trust | 95,325 | |||||||||
298,205 | |||||||||||
REITS - Health Care—0.7% | |||||||||||
1,461 | HCP, Inc. | 52,158 | |||||||||
653 | Health Care REIT, Inc. | 31,638 | |||||||||
801 | Healthcare Realty Trust, Inc. | 22,692 | |||||||||
597 | Nationwide Health Properties, Inc. | 21,504 | |||||||||
831 | Senior Housing Properties Trust | 19,902 | |||||||||
473 | Ventas, Inc. | 22,969 | |||||||||
170,863 | |||||||||||
REITS - Hotels—0.3% | |||||||||||
932 | Hospitality Properties Trust | 29,945 | |||||||||
3,036 | Host Hotels & Resorts, Inc. | 52,219 | |||||||||
82,164 | |||||||||||
REITS - Mortgage—0.3% | |||||||||||
1,465 | Annaly Capital Management, Inc. | 24,553 | |||||||||
238 | Gramercy Capital Corp. | 4,522 | |||||||||
1,458 | Newcastle Investment Corp. | 14,420 | |||||||||
704 | Redwood Trust, Inc. | 23,436 | |||||||||
66,931 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
REITS - Office Property—1.0% | |||||||||||
140 | Alexandria Real Estate Equities, Inc. | $ | 14,704 | ||||||||
891 | Boston Properties, Inc. | 89,537 | |||||||||
1,234 | Brandywine Realty Trust | 21,533 | |||||||||
625 | Highwoods Properties, Inc. | 21,900 | |||||||||
4,276 | HRPT Properties Trust | 29,633 | |||||||||
809 | Mack-Cali Realty Corp. | 31,567 | |||||||||
223 | SL Green Realty Corp. | 20,694 | |||||||||
229,568 | |||||||||||
REITS - Regional Malls—0.9% | |||||||||||
947 | CBL & Associates Properties, Inc. | 23,192 | |||||||||
1,281 | General Growth Properties, Inc. | 52,470 | |||||||||
418 | Macerich (The) Co. | 30,568 | |||||||||
539 | Pennsylvania REIT | 13,572 | |||||||||
993 | Simon Property Group, Inc. | 99,161 | |||||||||
218,963 | |||||||||||
REITS - Shopping Centers—0.8% | |||||||||||
847 | Developers Diversified Realty Corp. | 36,379 | |||||||||
354 | Equity One, Inc. | 8,744 | |||||||||
289 | Federal Realty Investment Trust | 23,741 | |||||||||
1,451 | Kimco Realty Corp. | 57,909 | |||||||||
435 | Regency Centers Corp. | 31,133 | |||||||||
766 | Weingarten Realty Investors | 28,258 | |||||||||
186,164 | |||||||||||
REITS - Single Tenant—0.1% | |||||||||||
830 | Realty Income Corp. | 21,837 | |||||||||
REITS - Storage—0.2% | |||||||||||
565 | Public Storage, Inc. | 51,246 | |||||||||
REITS - Warehouse/Industry—0.6% | |||||||||||
612 | AMB Property Corp. | 35,343 | |||||||||
624 | First Industrial Realty Trust, Inc. | 18,851 | |||||||||
1,266 | ProLogis | 79,264 | |||||||||
133,458 | |||||||||||
S&L/Thrifts - Central U.S.—0.1% | |||||||||||
1,164 | Flagstar Bancorp, Inc. | 7,124 | |||||||||
500 | TFS Financial Corp. | 6,115 | |||||||||
13,239 | |||||||||||
S&L/Thrifts - Eastern U.S.—0.8% | |||||||||||
853 | Astoria Financial Corp. | 20,216 | |||||||||
2,457 | Hudson City Bancorp, Inc. | 47,002 | |||||||||
2,972 | New York Community Bancorp, Inc. | 55,488 | |||||||||
881 | People's United Financial, Inc. | 14,951 | |||||||||
6,067 | Sovereign Bancorp, Inc. | 45,320 | |||||||||
182,977 |
See Notes to Financial Statements.
44
Schedule of Investments (Continued)
PowerShares FTSE RAFI Financials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
S&L/Thrifts - Western U.S.—1.7% | |||||||||||
455 | Downey Financial Corp. | $ | 6,434 | ||||||||
769 | Washington Federal, Inc. | 18,310 | |||||||||
31,314 | Washington Mutual, Inc. | 384,849 | |||||||||
409,593 | |||||||||||
Super - Regional Banks - U.S.—21.6% | |||||||||||
47,090 | Bank of America Corp. | 1,767,759 | |||||||||
4,143 | Capital One Financial Corp. | 219,579 | |||||||||
2,536 | Comerica, Inc. | 88,075 | |||||||||
8,279 | Fifth Third Bancorp | 177,419 | |||||||||
4,431 | Huntington Bancshares, Inc. | 41,607 | |||||||||
6,331 | KeyCorp | 152,767 | |||||||||
15,522 | National City Corp. | 97,789 | |||||||||
2,676 | PNC Financial Services Group, Inc. | 185,581 | |||||||||
3,832 | SunTrust Banks, Inc. | 213,634 | |||||||||
14,632 | U.S. Bancorp | 495,878 | |||||||||
28,204 | Wachovia Corp. | 822,147 | |||||||||
29,759 | Wells Fargo & Co. | 885,330 | |||||||||
5,147,565 | |||||||||||
Total Common Stocks and Other Equity Interests (Cost $27,213,595) | 23,820,721 | ||||||||||
Money Market Fund—0.6% | |||||||||||
138,912 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $138,912) | 138,912 | |||||||||
Total Investments (Cost $27,352,507)—100.5% | 23,959,633 | ||||||||||
Liabilities in excess of other assets—(0.5%) | (122,332 | ) | |||||||||
Net Assets—100.0% | $ | 23,837,301 |
REIT Real Estate Investment Trust
* Non-income producing security.
See Notes to Financial Statements.
45
Schedule of Investments
PowerShares FTSE RAFI Health Care Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.6% | |||||||||||
Biotechnology—5.7% | |||||||||||
9,940 | Amgen, Inc.* | $ | 416,187 | ||||||||
1,837 | Biogen Idec, Inc.* | 111,487 | |||||||||
498 | Celgene Corp.* | 30,946 | |||||||||
518 | Charles River Laboratories International, Inc.* | 30,070 | |||||||||
1,165 | Genentech, Inc.* | 79,453 | |||||||||
1,410 | Genzyme Corp.* | 99,194 | |||||||||
407 | Invitrogen Corp.* | 38,083 | |||||||||
805,420 | |||||||||||
Commercial Services—0.1% | |||||||||||
882 | Hillenbrand, Inc.* | 16,793 | |||||||||
Distribution/Wholesale—0.2% | |||||||||||
802 | Owens & Minor, Inc. | 36,347 | |||||||||
Electronics—1.5% | |||||||||||
1,081 | Applera Corp. - Applied Biosystems Group | 34,495 | |||||||||
3,120 | Thermo Fisher Scientific, Inc.* | 180,554 | |||||||||
215,049 | |||||||||||
Healthcare - Products—25.1% | |||||||||||
279 | Alcon, Inc. (Switzerland) | 44,082 | |||||||||
4,075 | Baxter International, Inc. | 253,954 | |||||||||
604 | Beckman Coulter, Inc. | 41,253 | |||||||||
1,577 | Becton, Dickinson & Co. | 140,984 | |||||||||
21,019 | Boston Scientific Corp.* | 280,183 | |||||||||
471 | C.R. Bard, Inc. | 44,354 | |||||||||
4,176 | Covidien Ltd. | 194,977 | |||||||||
821 | DENTSPLY International, Inc. | 31,912 | |||||||||
890 | Henry Schein, Inc.* | 49,279 | |||||||||
882 | Hill-Rom Holdings, Inc. | 22,165 | |||||||||
26,957 | Johnson & Johnson | 1,808,545 | |||||||||
6,885 | Medtronic, Inc. | 335,162 | |||||||||
1,178 | Patterson Cos., Inc.* | 40,288 | |||||||||
1,736 | St. Jude Medical, Inc.* | 76,002 | |||||||||
1,108 | Stryker Corp. | 71,832 | |||||||||
578 | Varian Medical Systems, Inc.* | 27,097 | |||||||||
1,405 | Zimmer Holdings, Inc.* | 104,195 | |||||||||
3,566,264 | |||||||||||
Healthcare - Services—14.9% | |||||||||||
4,041 | Aetna, Inc. | 176,188 | |||||||||
719 | AMERIGROUP Corp.* | 18,687 | |||||||||
1,208 | Apria Healthcare Group, Inc.* | 21,285 | |||||||||
541 | Brookdale Senior Living, Inc. | 14,163 | |||||||||
4,472 | CIGNA Corp. | 190,999 | |||||||||
1,907 | Community Health Systems, Inc.* | 71,570 | |||||||||
294 | Covance, Inc.* | 24,634 | |||||||||
1,774 | Coventry Health Care, Inc.* | 79,351 | |||||||||
1,127 | DaVita, Inc.* | 59,066 | |||||||||
11,109 | Health Management Associates, Inc., Class A* | 79,207 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
2,465 | Health Net, Inc.* | $ | 72,200 | ||||||||
2,109 | Humana, Inc.* | 100,789 | |||||||||
1,479 | Kindred Healthcare, Inc.* | 35,097 | |||||||||
907 | Laboratory Corp. of America Holdings* | 68,587 | |||||||||
1,373 | LifePoint Hospitals, Inc.* | 41,355 | |||||||||
1,011 | Lincare Holdings, Inc.* | 24,608 | |||||||||
642 | Magellan Health Services, Inc.* | 24,775 | |||||||||
1,425 | Quest Diagnostics, Inc. | 71,507 | |||||||||
24,062 | Tenet Healthcare Corp.* | 153,997 | |||||||||
10,445 | UnitedHealth Group, Inc. | 340,819 | |||||||||
867 | Universal Health Services, Inc., Class B | 54,309 | |||||||||
7,930 | WellPoint, Inc.* | 394,517 | |||||||||
2,117,710 | |||||||||||
Pharmaceuticals—52.1% | |||||||||||
13,463 | Abbott Laboratories | 710,173 | |||||||||
962 | Allergan, Inc. | 54,228 | |||||||||
650 | Barr Pharmaceuticals, Inc.* | 32,649 | |||||||||
35,147 | Bristol-Myers Squibb Co. | 772,180 | |||||||||
514 | Cephalon, Inc.* | 32,079 | |||||||||
12,403 | Eli Lilly & Co. | 597,080 | |||||||||
2,299 | Express Scripts, Inc.* | 160,976 | |||||||||
2,138 | Forest Laboratories, Inc.* | 74,210 | |||||||||
1,286 | Gilead Sciences, Inc.* | 66,563 | |||||||||
1,221 | Hospira, Inc.* | 50,244 | |||||||||
5,563 | King Pharmaceuticals, Inc.* | 52,237 | |||||||||
8,133 | Medco Health Solutions, Inc.* | 402,909 | |||||||||
27,765 | Merck & Co., Inc. | 1,056,181 | |||||||||
2,838 | Mylan, Inc. | 37,376 | |||||||||
119,896 | Pfizer, Inc. | 2,411,108 | |||||||||
11,411 | Schering-Plough Corp. | 210,077 | |||||||||
696 | Warner Chilcott Ltd., Class A* | 11,978 | |||||||||
1,592 | Watson Pharmaceuticals, Inc.* | 49,416 | |||||||||
14,261 | Wyeth | 634,187 | |||||||||
7,415,851 | |||||||||||
Total Common Stocks (Cost $15,693,641) | 14,173,434 | ||||||||||
Money Market Fund—1.5% | |||||||||||
207,632 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $207,632) | 207,632 | |||||||||
Total Investments (Cost $15,901,273)—101.1% | 14,381,066 | ||||||||||
Liabilities in excess of other assets—(1.1%) | (150,633 | ) | |||||||||
Net Assets—100.0% | $ | 14,230,433 |
* Non-income producing security.
See Notes to Financial Statements.
46
Schedule of Investments
PowerShares FTSE RAFI Industrials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.3% | |||||||||||
Aerospace/Defense—14.6% | |||||||||||
205 | Alliant Techsystems, Inc.* | $ | 22,546 | ||||||||
3,825 | Boeing Co. | 324,590 | |||||||||
250 | DRS Technologies, Inc. | 15,610 | |||||||||
2,001 | General Dynamics Corp. | 180,930 | |||||||||
735 | Goodrich Corp. | 50,090 | |||||||||
588 | L-3 Communications Holdings, Inc. | 65,533 | |||||||||
2,075 | Lockheed Martin Corp. | 220,033 | |||||||||
3,070 | Northrop Grumman Corp. | 225,860 | |||||||||
2,689 | Raytheon Co. | 172,015 | |||||||||
627 | Rockwell Collins, Inc. | 39,570 | |||||||||
612 | Spirit Aerosystems Holdings, Inc., Class A* | 17,852 | |||||||||
4,930 | United Technologies Corp. | 357,277 | |||||||||
1,691,906 | |||||||||||
Auto Manufacturers—1.5% | |||||||||||
568 | Oshkosh Corp., Class B | 23,061 | |||||||||
3,155 | PACCAR, Inc. | 149,294 | |||||||||
172,355 | |||||||||||
Building Materials—2.6% | |||||||||||
348 | Armstrong World Industries, Inc. | 12,385 | |||||||||
433 | Lennox International, Inc. | 14,350 | |||||||||
197 | Martin Marietta Materials, Inc. | 21,548 | |||||||||
6,103 | Masco Corp. | 111,136 | |||||||||
2,391 | Owens Corning, Inc.* | 50,474 | |||||||||
1,197 | Trane, Inc. | 55,672 | |||||||||
872 | USG Corp.* | 30,790 | |||||||||
296,355 | |||||||||||
Chemicals—0.5% | |||||||||||
952 | Sherwin-Williams (The) Co. | 52,665 | |||||||||
Commercial Services—6.4% | |||||||||||
2,806 | Accenture Ltd., Class A (Bermuda) | 105,365 | |||||||||
253 | Alliance Data Systems Corp.* | 14,525 | |||||||||
3,064 | Automatic Data Processing, Inc. | 135,429 | |||||||||
249 | ChoicePoint, Inc.* | 12,039 | |||||||||
1,818 | Convergys Corp.* | 28,579 | |||||||||
613 | Corrections Corp. of America* | 15,632 | |||||||||
944 | Deluxe Corp. | 20,069 | |||||||||
555 | Hewitt Associates, Inc., Class A* | 22,755 | |||||||||
871 | Iron Mountain, Inc.* | 23,926 | |||||||||
956 | Kelly Services, Inc., Class A | 21,271 | |||||||||
1,001 | Manpower, Inc. | 67,197 | |||||||||
1,459 | Paychex, Inc. | 53,064 | |||||||||
2,388 | PHH Corp.* | 46,876 | |||||||||
2,287 | R.R. Donnelley & Sons Co. | 70,074 | |||||||||
719 | Robert Half International, Inc. | 17,040 | |||||||||
825 | Total System Services, Inc. | 19,635 | |||||||||
1,508 | United Rentals, Inc.* | 28,411 | |||||||||
1,487 | Western Union (The) Co. | 34,201 | |||||||||
736,088 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Computers—0.4% | |||||||||||
887 | Affiliated Computer Services, Inc., Class A* | $ | 46,984 | ||||||||
Distribution/Wholesale—1.0% | |||||||||||
2,950 | BlueLinx Holdings, Inc. | 15,281 | |||||||||
369 | Fastenal Co. | 18,011 | |||||||||
404 | United Stationers, Inc.* | 17,812 | |||||||||
532 | W.W. Grainger, Inc. | 46,130 | |||||||||
577 | WESCO International, Inc.* | 21,470 | |||||||||
118,704 | |||||||||||
Electric—0.4% | |||||||||||
1,449 | MDU Resources Group, Inc. | 41,833 | |||||||||
Electrical Components & Equipment—2.5% | |||||||||||
314 | AMETEK, Inc. | 15,235 | |||||||||
4,316 | Emerson Electric Co. | 225,555 | |||||||||
499 | Hubbell, Inc., Class B | 22,321 | |||||||||
530 | Molex, Inc. | 15,041 | |||||||||
444 | Molex, Inc., Class A | 11,508 | |||||||||
289,660 | |||||||||||
Electronics—5.2% | |||||||||||
1,236 | Agilent Technologies, Inc.* | 37,340 | |||||||||
386 | Amphenol Corp., Class A | 17,825 | |||||||||
1,953 | Arrow Electronics, Inc.* | 53,141 | |||||||||
2,135 | Avnet, Inc.* | 55,916 | |||||||||
493 | AVX Corp. | 6,493 | |||||||||
927 | Benchmark Electronics, Inc.* | 16,482 | |||||||||
10,501 | Flextronics International Ltd. (Singapore)* | 109,105 | |||||||||
3,188 | Jabil Circuit, Inc. | 34,685 | |||||||||
133 | Mettler Toledo International, Inc.* | 12,670 | |||||||||
741 | PerkinElmer, Inc. | 19,681 | |||||||||
33,033 | Sanmina-SCI Corp.* | 51,201 | |||||||||
395 | Thomas & Betts Corp.* | 14,797 | |||||||||
3,609 | Tyco Electronics Ltd. | 135,012 | |||||||||
3,568 | Vishay Intertechnology, Inc.* | 33,718 | |||||||||
598,066 | |||||||||||
Energy - Alternate Sources—0.1% | |||||||||||
360 | Covanta Holding Corp.* | 9,587 | |||||||||
Engineering & Construction—2.4% | |||||||||||
884 | Aecom Technology Corp.* | 24,275 | |||||||||
952 | EMCOR Group, Inc.* | 23,857 | |||||||||
358 | Fluor Corp. | 54,727 | |||||||||
220 | Foster Wheeler Ltd.* | 14,012 | |||||||||
424 | Granite Construction, Inc. | 14,543 | |||||||||
494 | Jacobs Engineering Group, Inc.* | 42,647 | |||||||||
1,553 | KBR, Inc. | 44,789 | |||||||||
255 | McDermott International, Inc.* | 13,663 | |||||||||
373 | Shaw Group (The), Inc.* | 18,434 | |||||||||
657 | URS Corp.* | 26,503 | |||||||||
277,450 |
See Notes to Financial Statements.
47
Schedule of Investments (Continued)
PowerShares FTSE RAFI Industrials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Environmental Control—2.6% | |||||||||||
6,850 | Allied Waste Industries, Inc.* | $ | 84,666 | ||||||||
1,293 | Nalco Holding Co. | 29,726 | |||||||||
950 | Republic Services, Inc. | 30,201 | |||||||||
4,209 | Waste Management, Inc. | 151,944 | |||||||||
296,537 | |||||||||||
Forest Products & Paper—1.4% | |||||||||||
2,486 | Louisiana-Pacific Corp. | 28,614 | |||||||||
2,627 | MeadWestvaco Corp. | 69,090 | |||||||||
4,892 | Smurfit-Stone Container Corp.* | 26,564 | |||||||||
3,221 | Temple-Inland, Inc. | 37,589 | |||||||||
161,857 | |||||||||||
Hand/Machine Tools—0.3% | |||||||||||
639 | Kennametal, Inc. | 22,218 | |||||||||
204 | Lincoln Electric Holdings, Inc. | 15,565 | |||||||||
37,783 | |||||||||||
Household Products/Wares—0.7% | |||||||||||
1,242 | Fortune Brands, Inc. | 83,984 | |||||||||
Machinery - Construction & Mining—2.8% | |||||||||||
3,354 | Caterpillar, Inc. | 274,625 | |||||||||
216 | Joy Global, Inc. | 16,038 | |||||||||
519 | Terex Corp.* | 36,164 | |||||||||
326,827 | |||||||||||
Machinery - Diversified—3.0% | |||||||||||
479 | AGCO Corp.* | 28,802 | |||||||||
1,042 | Cummins, Inc. | 65,281 | |||||||||
1,762 | Deere & Co. | 148,132 | |||||||||
188 | Flowserve Corp. | 23,329 | |||||||||
184 | NACCO Industries, Inc., Class A | 16,542 | |||||||||
892 | Rockwell Automation, Inc. | 48,373 | |||||||||
267 | Roper Industries, Inc. | 16,586 | |||||||||
347,045 | |||||||||||
Metal Fabricate/Hardware—0.9% | |||||||||||
543 | Mueller Industries, Inc. | 17,577 | |||||||||
407 | Mueller Water Products, Inc., Class A | 3,276 | |||||||||
1,208 | Mueller Water Products, Inc., Class B | 9,592 | |||||||||
290 | Precision Castparts Corp. | 34,092 | |||||||||
986 | Timken (The) Co. | 35,644 | |||||||||
100,181 | |||||||||||
Mining—0.3% | |||||||||||
575 | Vulcan Materials Co. | 39,572 | |||||||||
Miscellaneous Manufacturing—31.9% | |||||||||||
3,958 | 3M Co. | 304,370 | |||||||||
345 | Acuity Brands, Inc. | 16,505 | |||||||||
355 | AptarGroup, Inc. | 15,673 | |||||||||
252 | Brink's (The) Co. | 18,333 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
464 | Carlisle Cos., Inc. | $ | 13,400 | ||||||||
1,127 | Cooper Industries Ltd., Class A | 47,774 | |||||||||
380 | Crane Co. | 15,557 | |||||||||
695 | Danaher Corp. | 54,224 | |||||||||
1,371 | Dover Corp. | 67,823 | |||||||||
1,027 | Eaton Corp. | 90,212 | |||||||||
56,084 | General Electric Co. | 1,833,946 | |||||||||
430 | Harsco Corp. | 25,512 | |||||||||
4,152 | Honeywell International, Inc. | 246,629 | |||||||||
2,971 | Illinois Tool Works, Inc. | 155,354 | |||||||||
2,112 | Ingersoll-Rand Co. Ltd., Class A | 93,731 | |||||||||
903 | ITT Corp. | 57,792 | |||||||||
521 | Pall Corp. | 18,115 | |||||||||
1,102 | Parker Hannifin Corp. | 87,995 | |||||||||
776 | Pentair, Inc. | 28,580 | |||||||||
323 | SPX Corp. | 39,729 | |||||||||
369 | Teleflex, Inc. | 20,328 | |||||||||
1,475 | Textron, Inc. | 89,990 | |||||||||
595 | Trinity Industries, Inc. | 18,088 | |||||||||
6,945 | Tyco International Ltd. (Bermuda) | 324,956 | |||||||||
3,684,616 | |||||||||||
Packaging & Containers—2.4% | |||||||||||
757 | Ball Corp. | 40,711 | |||||||||
1,185 | Bemis Co., Inc. | 31,166 | |||||||||
1,561 | Crown Holdings, Inc.* | 41,897 | |||||||||
2,438 | Graphic Packaging Holding Co.* | 6,826 | |||||||||
182 | Greif, Inc., Class A | 11,757 | |||||||||
16 | Greif, Inc., Class B | 910 | |||||||||
638 | Owens-Illinois, Inc.* | 35,186 | |||||||||
651 | Packaging Corp. of America | 14,309 | |||||||||
1,080 | Pactiv Corp.* | 25,693 | |||||||||
1,233 | Sealed Air Corp. | 31,183 | |||||||||
224 | Silgan Holdings, Inc. | 11,935 | |||||||||
1,097 | Sonoco Products Co. | 36,146 | |||||||||
287,719 | |||||||||||
Retail—0.3% | |||||||||||
370 | MSC Industrial Direct Co., Class A | 18,042 | |||||||||
606 | World Fuel Services Corp. | 14,883 | |||||||||
32,925 | |||||||||||
Software—1.2% | |||||||||||
965 | Broadridge Financial Solutions, Inc. | 17,968 | |||||||||
1,082 | Fidelity National Information Services, Inc. | 39,017 | |||||||||
831 | Fiserv, Inc.* | 42,007 | |||||||||
681 | IMS Health, Inc. | 16,855 | |||||||||
990 | Metavante Technologies, Inc.* | 23,334 | |||||||||
139,181 | |||||||||||
Telecommunications—0.2% | |||||||||||
326 | Anixter International, Inc.* | 18,572 |
See Notes to Financial Statements.
48
Schedule of Investments (Continued)
PowerShares FTSE RAFI Industrials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Textiles—0.2% | |||||||||||
862 | Cintas Corp. | $ | 25,524 | ||||||||
Transportation—14.3% | |||||||||||
368 | Alexander & Baldwin, Inc. | 18,485 | |||||||||
1,765 | Burlington Northern Santa Fe Corp. | 181,001 | |||||||||
535 | C.H. Robinson Worldwide, Inc. | 33,534 | |||||||||
528 | Con-way, Inc. | 24,420 | |||||||||
2,062 | CSX Corp. | 129,803 | |||||||||
541 | Expeditors International of Washington, Inc. | 25,205 | |||||||||
2,340 | FedEx Corp. | 224,336 | |||||||||
474 | General Maritime Corp. | 12,386 | |||||||||
511 | J.B. Hunt Transport Services, Inc. | 17,359 | |||||||||
468 | Kansas City Southern* | 21,097 | |||||||||
2,135 | Norfolk Southern Corp. | 127,203 | |||||||||
339 | Overseas Shipholding Group, Inc. | 25,513 | |||||||||
753 | Ryder System, Inc. | 51,558 | |||||||||
527 | Ship Finance International Ltd. (Bermuda) | 15,979 | |||||||||
540 | Teekay Shipping Corp. (Bahamas) | 24,646 | |||||||||
1,473 | Union Pacific Corp. | 213,865 | |||||||||
6,089 | United Parcel Service, Inc., Class B | 440,903 | |||||||||
582 | Werner Enterprises, Inc. | 11,320 | |||||||||
3,317 | YRC Worldwide, Inc.* | 53,901 | |||||||||
1,652,514 | |||||||||||
Trucking & Leasing—0.2% | |||||||||||
512 | GATX Corp. | 22,528 | |||||||||
Total Common Stocks (Cost $13,042,922) | 11,589,018 | ||||||||||
Money Market Fund—2.0% | |||||||||||
226,971 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $226,971) | 226,971 | |||||||||
Total Investments (Cost $13,269,893)—102.3% | 11,815,989 | ||||||||||
Liabilities in excess of other assets—(2.3%) | (264,395 | ) | |||||||||
Net Assets—100.0% | $ | 11,551,594 |
* Non-income producing security.
See Notes to Financial Statements.
49
Schedule of Investments
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.2% | |||||||||||
Applications Software—15.4% | |||||||||||
474 | Citrix Systems, Inc.* | $ | 15,524 | ||||||||
1,651 | Compuware Corp.* | 12,449 | |||||||||
1,171 | Intuit, Inc.* | 31,582 | |||||||||
55,002 | Microsoft Corp. | 1,568,656 | |||||||||
1,628,211 | |||||||||||
Cellular Telecommunications—0.7% | |||||||||||
325 | Leap Wireless International, Inc.* | 17,378 | |||||||||
549 | NII Holdings, Inc.* | 25,111 | |||||||||
481 | United States Cellular Corp.* | 26,527 | |||||||||
69,016 | |||||||||||
Computer Aided Design—0.2% | |||||||||||
421 | Autodesk, Inc.* | 15,998 | |||||||||
Computer Services—3.3% | |||||||||||
287 | CACI International, Inc., Class A* | 14,384 | |||||||||
2,753 | Computer Sciences Corp.* | 120,003 | |||||||||
311 | DST Systems, Inc.* | 18,610 | |||||||||
8,313 | Electronic Data Systems Corp. | 154,290 | |||||||||
850 | Perot Systems Corp., Class A* | 13,294 | |||||||||
6,867 | Unisys Corp.* | 28,567 | |||||||||
349,148 | |||||||||||
Computers—11.6% | |||||||||||
1,344 | Apple, Inc.* | 233,789 | |||||||||
13,270 | Dell, Inc.* | 247,220 | |||||||||
6,630 | Hewlett-Packard Co. | 307,301 | |||||||||
2,951 | International Business Machines Corp. | 356,185 | |||||||||
4,855 | Sun Microsystems, Inc.* | 76,029 | |||||||||
1,220,524 | |||||||||||
Computers - Integrated Systems—0.8% | |||||||||||
872 | Diebold, Inc. | 34,182 | |||||||||
1,883 | NCR Corp.* | 46,379 | |||||||||
80,561 | |||||||||||
Computers - Memory Devices—2.6% | |||||||||||
7,376 | EMC Corp.* | 113,591 | |||||||||
1,013 | NetApp, Inc.* | 24,515 | |||||||||
1,683 | SanDisk Corp.* | 45,592 | |||||||||
3,352 | Seagate Technology (Cayman Islands) | 63,252 | |||||||||
1,003 | Western Digital Corp.* | 29,077 | |||||||||
276,027 | |||||||||||
Computers - Peripheral Equipment—0.3% | |||||||||||
1,148 | Lexmark International, Inc., Class A* | 36,036 | |||||||||
Consulting Services—0.4% | |||||||||||
2,477 | SAIC, Inc.* | 47,063 | |||||||||
Distribution/Wholesale—1.6% | |||||||||||
5,495 | Ingram Micro, Inc., Class A* | 93,470 | |||||||||
2,367 | Tech Data Corp.* | 79,555 | |||||||||
173,025 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Diversified Operations—0.2% | |||||||||||
357 | Leucadia National Corp. | $ | 18,286 | ||||||||
Electronic Component - Semiconductors—8.6% | |||||||||||
9,244 | Advanced Micro Devices, Inc.* | 55,094 | |||||||||
1,055 | Altera Corp. | 22,450 | |||||||||
1,068 | Amkor Technology, Inc.* | 10,199 | |||||||||
1,827 | Broadcom Corp., Class A* | 47,429 | |||||||||
1,110 | Fairchild Semiconductor International, Inc.* | 14,474 | |||||||||
15,928 | Intel Corp. | 354,558 | |||||||||
420 | International Rectifier Corp.* | 9,559 | |||||||||
615 | Intersil Corp., Class A | 16,433 | |||||||||
3,929 | LSI Logic Corp.* | 24,360 | |||||||||
163 | MEMC Electronic Materials, Inc.* | 10,264 | |||||||||
704 | Microchip Technology, Inc. | 25,872 | |||||||||
10,194 | Micron Technology, Inc.* | 78,698 | |||||||||
1,378 | National Semiconductor Corp. | 28,097 | |||||||||
1,187 | NVIDIA Corp.* | 24,393 | |||||||||
8,428 | Spansion, Inc., Class A* | 27,812 | |||||||||
4,700 | Texas Instruments, Inc. | 137,053 | |||||||||
1,032 | Xilinx, Inc. | 25,563 | |||||||||
912,308 | |||||||||||
Electronic Design Automation—0.4% | |||||||||||
1,924 | Cadence Design Systems, Inc.* | 21,414 | |||||||||
663 | Synopsys, Inc.* | 15,322 | |||||||||
36,736 | |||||||||||
Electronic Forms—0.4% | |||||||||||
1,063 | Adobe Systems, Inc.* | 39,639 | |||||||||
Enterprise Software/Services—3.1% | |||||||||||
511 | BMC Software, Inc.* | 17,762 | |||||||||
1,454 | CA, Inc. | 32,192 | |||||||||
12,910 | Oracle Corp.* | 269,174 | |||||||||
313 | SYNNEX Corp.* | 7,474 | |||||||||
326,602 | |||||||||||
Internet Security—1.6% | |||||||||||
830 | Check Point Software Technologies (Israel)* | 19,605 | |||||||||
454 | McAfee, Inc.* | 15,096 | |||||||||
5,347 | Symantec Corp.* | 92,074 | |||||||||
1,194 | VeriSign, Inc.* | 43,044 | |||||||||
169,819 | |||||||||||
Medical Information Systems—0.1% | |||||||||||
299 | Cerner Corp.* | 13,835 | |||||||||
Networking Products—4.6% | |||||||||||
17,320 | Cisco Systems, Inc.* | 444,085 | |||||||||
1,668 | Juniper Networks, Inc.* | 46,070 | |||||||||
490,155 |
See Notes to Financial Statements.
50
Schedule of Investments (Continued)
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Office Automation & Equipment—2.2% | |||||||||||
2,710 | IKON Office Solutions, Inc. | $ | 29,675 | ||||||||
1,925 | Pitney Bowes, Inc. | 69,512 | |||||||||
9,216 | Xerox Corp. | 128,747 | |||||||||
227,934 | |||||||||||
Retail - Computer Equipment—0.1% | |||||||||||
948 | Insight Enterprises, Inc.* | 11,433 | |||||||||
Semiconductor Components - Integrated Circuit—1.2% | |||||||||||
1,358 | Analog Devices, Inc. | 43,742 | |||||||||
4,177 | Atmel Corp.* | 15,538 | |||||||||
1,554 | Integrated Device Technology, Inc.* | 16,612 | |||||||||
770 | Linear Technology Corp. | 26,919 | |||||||||
1,776 | Marvell Technology Group Ltd. (Bermuda)* | 22,999 | |||||||||
125,810 | |||||||||||
Semiconductor Equipment—1.4% | |||||||||||
4,070 | Applied Materials, Inc. | 75,947 | |||||||||
697 | KLA-Tencor Corp. | 30,445 | |||||||||
392 | Lam Research Corp.* | 16,009 | |||||||||
695 | Novellus Systems, Inc.* | 15,193 | |||||||||
1,091 | Teradyne, Inc.* | 14,499 | |||||||||
152,093 | |||||||||||
Telecommunication Equipment—0.6% | |||||||||||
529 | Harris Corp. | 28,582 | |||||||||
3,833 | Tellabs, Inc.* | 19,778 | |||||||||
4,547 | UTStarcom, Inc.* | 14,778 | |||||||||
63,138 | |||||||||||
Telecommunication Equipment Fiber Optics—0.8% | |||||||||||
2,983 | Corning, Inc. | 79,676 | |||||||||
Telecommunication Services—1.3% | |||||||||||
979 | Amdocs Ltd. (Guernsey)* | 30,721 | |||||||||
1,396 | Embarq Corp. | 58,032 | |||||||||
635 | FairPoint Communications, Inc. | 5,848 | |||||||||
3,614 | Virgin Media, Inc. | 46,621 | |||||||||
141,222 | |||||||||||
Telephone - Integrated—30.3% | |||||||||||
29,791 | AT&T, Inc. | 1,153,209 | |||||||||
1,154 | CenturyTel, Inc. | 37,447 | |||||||||
5,721 | Citizens Communications Co. | 61,329 | |||||||||
10,383 | Level 3 Communications, Inc.* | 30,838 | |||||||||
21,710 | Qwest Communications International, Inc. | 112,024 | |||||||||
56,227 | Sprint Nextel Corp. | 449,253 | |||||||||
460 | Telephone & Data Systems, Inc. | 17,618 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
502 | Telephone & Data Systems, Inc., Special Shares | $ | 18,198 | ||||||||
33,709 | Verizon Communications, Inc. | 1,297,121 | |||||||||
1,763 | Windstream Corp. | 20,698 | |||||||||
3,197,735 | |||||||||||
Web Portals/ISP—1.8% | |||||||||||
223 | Google Inc., Class A* | 128,066 | |||||||||
2,172 | Yahoo!, Inc.* | 59,535 | |||||||||
187,601 | |||||||||||
Wireless Equipment—4.6% | |||||||||||
946 | American Tower Corp., Class A* | 41,075 | |||||||||
270 | Crown Castle International Corp.* | 10,490 | |||||||||
25,661 | Motorola, Inc. | 255,583 | |||||||||
4,090 | QUALCOMM, Inc. | 176,647 | |||||||||
483,795 | |||||||||||
Total Common Stocks (Cost $11,399,956) | 10,573,426 | ||||||||||
Money Market Fund—1.2% | |||||||||||
127,889 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $127,889) | 127,889 | |||||||||
Total Investments (Cost $11,527,845)—101.4% | 10,701,315 | ||||||||||
Liabilities in excess of other assets—(1.4%) | (145,085 | ) | |||||||||
Net Assets—100.0% | $ | 10,556,230 |
* Non-income producing security.
See Notes to Financial Statements.
51
Schedule of Investments
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests—99.3% | |||||||||||
Consumer Discretionary—18.4% | |||||||||||
9,433 | 1-800-FLOWERS.COM, Inc., Class A* | $ | 83,199 | ||||||||
2,792 | 4Kids Entertainment, Inc.* | 24,709 | |||||||||
10,693 | 99 Cents Only Stores* | 101,690 | |||||||||
5,103 | A.C. Moore Arts & Crafts, Inc.* | 33,731 | |||||||||
9,802 | Aaron Rents, Inc. | 244,071 | |||||||||
4,391 | Aeropostale, Inc.* | 139,590 | |||||||||
15,359 | AFC Enterprises, Inc.* | 158,966 | |||||||||
3,777 | Aftermarket Technology Corp.* | 86,531 | |||||||||
3,327 | Alloy, Inc.* | 22,990 | |||||||||
588 | Amcon Distributing Co.* | 17,552 | |||||||||
3,209 | Ameristar Casinos, Inc. | 55,099 | |||||||||
1,217 | Arbitron, Inc. | 58,221 | |||||||||
9,163 | Arctic Cat, Inc. | 69,456 | |||||||||
7,606 | Audiovox Corp., Class A* | 83,058 | |||||||||
1,805 | Avatar Holdings, Inc.* | 73,752 | |||||||||
2,215 | Bally Technologies, Inc.* | 74,623 | |||||||||
4,444 | Bassett Furniture Industries, Inc. | 53,061 | |||||||||
3,303 | Bebe Stores, Inc. | 32,997 | |||||||||
851 | Benihana, Inc.* | 8,833 | |||||||||
2,101 | Benihana, Inc., Class A* | 21,808 | |||||||||
7,242 | Big 5 Sporting Goods Corp. | 66,554 | |||||||||
7,516 | Bluegreen Corp.* | 52,837 | |||||||||
6,299 | Blyth, Inc. | 106,075 | |||||||||
6,206 | Bob Evans Farms, Inc. | 174,202 | |||||||||
16,220 | Bon-Ton Stores (The), Inc. | 142,249 | |||||||||
4,137 | Books-A-Million, Inc. | 33,510 | |||||||||
1,701 | Bright Horizons Family Solutions, Inc.* | 80,644 | |||||||||
12,097 | Brown Shoe Co., Inc. | 201,778 | |||||||||
1,113 | Buckle (The), Inc. | 54,070 | |||||||||
4,260 | Build-A-Bear Workshop, Inc.* | 46,434 | |||||||||
32,895 | Building Material Holding Corp. | 153,291 | |||||||||
11,929 | Cabela's, Inc.* | 161,399 | |||||||||
3,363 | Cache, Inc.* | 41,230 | |||||||||
13,534 | California Coastal Communities, Inc.* | 89,324 | |||||||||
4,595 | California Pizza Kitchen, Inc.* | 71,636 | |||||||||
8,716 | Callaway Golf Co. | 119,758 | |||||||||
7,452 | Carmike Cinemas, Inc. | 61,106 | |||||||||
4,276 | Carrols Restaurant Group, Inc.* | 34,422 | |||||||||
4,602 | Carter's, Inc.* | 65,072 | |||||||||
13,830 | Casual Male Retail Group, Inc.* | 59,746 | |||||||||
6,592 | Cato Corp. (The), Class A | 113,712 | |||||||||
5,836 | CBRL Group, Inc. | 215,582 | |||||||||
4,408 | CEC Entertainment, Inc.* | 163,978 | |||||||||
12,985 | Champion Enterprises, Inc.* | 134,005 | |||||||||
3,097 | Charlotte Russe Holding, Inc.* | 49,180 | |||||||||
8,123 | Cheesecake Factory (The), Inc.* | 183,823 | |||||||||
1,151 | Cherokee, Inc. | 33,379 | |||||||||
3,590 | Children's Place Retail Stores (The), Inc.* | 83,468 | |||||||||
460 | Chipotle Mexican Grill, Inc., Class A* | 45,140 | |||||||||
571 | Chipotle Mexican Grill, Inc., Class B* | 48,518 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
2,942 | Choice Hotels International, Inc. | $ | 101,470 | ||||||||
5,879 | Christopher & Banks Corp. | 69,666 | |||||||||
478 | Churchill Downs, Inc. | 24,402 | |||||||||
4,546 | Cinemark Holdings, Inc. | 67,326 | |||||||||
126,926 | Citadel Broadcasting Corp. | 172,619 | |||||||||
1,842 | Citi Trends, Inc.* | 38,940 | |||||||||
12,021 | CKE Restaurants, Inc. | 126,100 | |||||||||
3,342 | CKX, Inc.* | 30,078 | |||||||||
11,263 | Coachmen Industries, Inc.* | 42,462 | |||||||||
2,687 | Coinstar, Inc.* | 85,688 | |||||||||
13,116 | Coldwater Creek, Inc.* | 70,039 | |||||||||
1,606 | Columbia Sportswear Co. | 67,388 | |||||||||
5,139 | Conn's, Inc.* | 90,601 | |||||||||
16,475 | Corinthian Colleges, Inc.* | 186,991 | |||||||||
29,234 | Cost Plus, Inc.* | 80,686 | |||||||||
17,009 | Cox Radio, Inc., Class A* | 197,815 | |||||||||
473 | CROCS, Inc.* | 4,829 | |||||||||
18,633 | CSK Auto Corp.* | 222,293 | |||||||||
1,383 | CSS Industries, Inc. | 43,246 | |||||||||
1,317 | CTC Media, Inc.* | 34,071 | |||||||||
11,019 | Cumulus Media, Inc., Class A* | 65,012 | |||||||||
430 | Deckers Outdoor Corp.* | 59,370 | |||||||||
25,520 | Denny's Corp.* | 80,388 | |||||||||
2,719 | DeVry, Inc. | 154,983 | |||||||||
7,352 | Directed Electronics, Inc.* | 14,630 | |||||||||
4,682 | Dixie Group, Inc.* | 36,520 | |||||||||
5,905 | Domino's Pizza, Inc. | 78,418 | |||||||||
2,969 | Dorman Products, Inc.* | 30,699 | |||||||||
4,080 | Dover Downs Gaming & Entertainment, Inc. | 32,966 | |||||||||
4,458 | DreamWorks Animation SKG, Inc., Class A* | 124,646 | |||||||||
11,718 | Dress Barn (The), Inc.* | 157,724 | |||||||||
1,997 | Drew Industries, Inc.* | 48,707 | |||||||||
6,571 | DSW, Inc., Class A* | 100,733 | |||||||||
2,504 | Duckwall-ALCO Stores, Inc.* | 29,147 | |||||||||
21,068 | Eddie Bauer Holdings, Inc.* | 83,851 | |||||||||
39,733 | Emmis Communications Corp., Class A* | 123,570 | |||||||||
12,689 | Entercom Communications Corp., Class A | 134,503 | |||||||||
18,460 | Entravision Communications Corp., Class A* | 129,035 | |||||||||
7,000 | Ethan Allen Interiors, Inc. | 192,290 | |||||||||
46,862 | Finish Line (The), Inc., Class A* | 307,884 | |||||||||
95,671 | Finlay Enterprises, Inc.* | 48,792 | |||||||||
36,124 | Fleetwood Enterprises, Inc.* | 124,628 | |||||||||
2,800 | Flexsteel Industries | 31,164 | |||||||||
2,552 | Fossil, Inc.* | 91,336 | |||||||||
13,398 | Fred's, Inc., Class A | 148,450 | |||||||||
2,160 | FTD Group, Inc. | 29,700 | |||||||||
3,206 | Gander Mountain Co.* | 15,709 | |||||||||
7,485 | GateHouse Media, Inc. | 39,671 | |||||||||
4,819 | Gaylord Entertainment Co.* | 142,739 | |||||||||
10,441 | Gemstar-TV Guide International, Inc.* | 42,077 | |||||||||
4,961 | Genesco, Inc.* | 109,936 |
See Notes to Financial Statements.
52
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
`11,603 | Gentex Corp. | $ | 216,744 | ||||||||
1,831 | G-III Apparel Group Ltd.* | 27,007 | |||||||||
5,789 | Golfsmith International Holdings, Inc.* | 10,015 | |||||||||
20,540 | Gottschalks, Inc.* | 48,474 | |||||||||
14,051 | Gray Television, Inc. | 66,040 | |||||||||
7,116 | Great Wolf Resorts, Inc.* | 43,479 | |||||||||
2,318 | GSI Commerce, Inc.* | 32,267 | |||||||||
1,262 | Guess ?, Inc. | 48,309 | |||||||||
2,210 | Gymboree (The) Corp.* | 95,516 | |||||||||
191 | Hallwood Group, Inc.* | 12,896 | |||||||||
12,219 | Harris Interactive, Inc.* | 30,548 | |||||||||
6,279 | Harte-Hanks, Inc. | 85,771 | |||||||||
28,755 | Hartmarx Corp.* | 75,913 | |||||||||
4,994 | Hastings Entertainment, Inc.* | 41,600 | |||||||||
8,139 | Haverty Furniture Cos., Inc. | 74,309 | |||||||||
58,423 | Hayes Lemmerz International, Inc.* | 175,269 | |||||||||
5,299 | Helen of Troy Ltd.* | 89,606 | |||||||||
1,994 | HHGregg, Inc.* | 20,478 | |||||||||
3,389 | Hibbett Sports, Inc.* | 61,883 | |||||||||
1,935 | Hooker Furniture Corp. | 40,577 | |||||||||
18,657 | HOT Topic, Inc.* | 99,069 | |||||||||
2,632 | Iconix Brand Group, Inc.* | 41,901 | |||||||||
1,984 | IHOP Corp. | 92,534 | |||||||||
2,610 | Interactive Data Corp. | 70,418 | |||||||||
4,742 | International Speedway Corp., Class A | 201,156 | |||||||||
16,479 | Interstate Hotels & Resorts, Inc.* | 70,860 | |||||||||
9,167 | Isle of Capri Casinos, Inc.* | 61,786 | |||||||||
1,856 | ITT Educational Services, Inc.* | 142,281 | |||||||||
1,545 | J.Crew Group, Inc.* | 73,388 | |||||||||
3,393 | Jackson Hewitt Tax Service, Inc. | 50,590 | |||||||||
4,147 | JAKKS Pacific, Inc.* | 97,413 | |||||||||
8,374 | Jo-Ann Stores, Inc.* | 158,604 | |||||||||
4,720 | John Wiley & Sons, Inc., Class A | 217,356 | |||||||||
1,480 | Johnson Outdoors, Inc., Class A | 23,673 | |||||||||
2,718 | Jos. A. Bank Clothiers, Inc.* | 66,346 | |||||||||
18,899 | Journal Communications, Inc., Class A | 108,858 | |||||||||
4,855 | Kenneth Cole Productions, Inc., Class A | 93,459 | |||||||||
34,873 | Kirkland's, Inc.* | 60,330 | |||||||||
23,454 | Krispy Kreme Doughnuts, Inc.* | 72,473 | |||||||||
5,289 | K-Swiss, Inc., Class A | 77,484 | |||||||||
5,419 | Landry's Restaurants, Inc. | 86,541 | |||||||||
23,322 | La-Z-Boy, Inc. | 148,561 | |||||||||
13,782 | Leapfrog Enterprises, Inc.* | 114,528 | |||||||||
23,911 | Lenox Group, Inc.* | 35,149 | |||||||||
30,484 | Levitt Corp., Class A* | 63,407 | |||||||||
2,763 | Libbey, Inc. | 39,235 | |||||||||
1,571 | Life Time Fitness, Inc.* | 57,106 | |||||||||
2,256 | Lifetime Brands, Inc. | 19,221 | |||||||||
12,967 | Lin TV Corp., Class A* | 129,929 | |||||||||
980 | Lincoln Educational Services Corp.* | 11,446 | |||||||||
19,115 | Lithia Motors, Inc., Class A | 172,035 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
4,116 | LKQ Corp.* | $ | 89,564 | ||||||||
4,504 | LodgeNet Interactive Corp.* | 27,564 | |||||||||
6,852 | Lodgian, Inc.* | 66,533 | |||||||||
3,636 | Luby's, Inc.* | 27,306 | |||||||||
6,491 | M/I Homes, Inc. | 111,321 | |||||||||
88,421 | Magna Entertainment Corp., Class A (Canada)* | 30,947 | |||||||||
1,633 | Maidenform Brands, Inc.* | 24,332 | |||||||||
4,466 | Marcus Corp. | 74,091 | |||||||||
1,955 | Marine Products Corp. | 14,389 | |||||||||
9,465 | MarineMax, Inc.* | 107,901 | |||||||||
2,980 | Marvel Entertainment, Inc.* | 85,496 | |||||||||
2,217 | Matthews International Corp., Class A | 109,608 | |||||||||
3,493 | McCormick & Schmick's Seafood Restaurants, Inc.* | 42,021 | |||||||||
12,797 | Media General, Inc., Class A | 187,860 | |||||||||
33,653 | Mediacom Communications Corp., Class A* | 144,371 | |||||||||
7,760 | Men's Wearhouse (The), Inc. | 206,649 | |||||||||
14,125 | Modine Manufacturing Co. | 248,177 | |||||||||
10,266 | Monaco Coach Corp. | 64,984 | |||||||||
2,364 | Monro Muffler, Inc. | 39,006 | |||||||||
3,270 | Morgans Hotel Group Co.* | 45,747 | |||||||||
270 | Morningstar, Inc.* | 15,655 | |||||||||
3,078 | Morton's Restaurant Group, Inc.* | 24,593 | |||||||||
2,744 | Mothers Work, Inc.* | 38,389 | |||||||||
3,504 | Movado Group, Inc. | 76,527 | |||||||||
8,802 | MTR Gaming Group, Inc.* | 53,956 | |||||||||
6,935 | Multimedia Games, Inc.* | 29,543 | |||||||||
766 | National Presto Industries, Inc. | 41,510 | |||||||||
20,644 | Nautilus, Inc. | 74,525 | |||||||||
29,750 | Navarre Corp.* | 46,410 | |||||||||
3,398 | NetFlix, Inc.* | 108,668 | |||||||||
8,111 | New York & Co., Inc.* | 51,505 | |||||||||
3,462 | Nexstar Broadcasting Group, Inc., Class A* | 19,526 | |||||||||
2,571 | NutriSystem, Inc. | 51,626 | |||||||||
9,469 | O'Charleys, Inc. | 109,840 | |||||||||
14,681 | Orbitz Worldwide, Inc.* | 116,714 | |||||||||
1,820 | Orient-Express Hotels Ltd., Class A | 84,721 | |||||||||
3,457 | Orleans Homebuilders, Inc. | 17,285 | |||||||||
5,247 | Oxford Industries, Inc. | 145,814 | |||||||||
16,693 | Pacific Sunwear of California, Inc.* | 223,854 | |||||||||
13,331 | Palm Harbor Homes, Inc.* | 114,780 | |||||||||
2,540 | Panera Bread Co., Class A* | 132,740 | |||||||||
3,120 | Papa John's International, Inc.* | 84,240 | |||||||||
6,466 | PC Mall, Inc.* | 85,028 | |||||||||
17,632 | PEP Boys-Manny, Moe & Jack | 157,277 | |||||||||
3,116 | Perry Ellis International, Inc.* | 71,169 | |||||||||
3,173 | PF Chang's China Bistro, Inc.* | 98,458 | |||||||||
5,545 | Phillips-Van Heusen Corp. | 234,055 | |||||||||
36,014 | Pier 1 Imports, Inc.* | 280,910 | |||||||||
9,204 | Pinnacle Entertainment, Inc.* | 142,846 |
See Notes to Financial Statements.
53
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
4,271 | Playboy Enterprises, Inc., Class B* | $ | 35,706 | ||||||||
8,249 | Pomeroy IT Solutions, Inc.* | 50,979 | |||||||||
7,149 | Pool Corp. | 156,063 | |||||||||
762 | Pre-Paid Legal Services, Inc.* | 33,330 | |||||||||
976 | priceline.com, Inc.* | 124,577 | |||||||||
5,277 | PRIMEDIA, Inc. | 35,725 | |||||||||
101,378 | Radio One, Inc., Class D* | 101,378 | |||||||||
5,137 | RC2 Corp.* | 95,035 | |||||||||
10,853 | RCN Corp. | 124,375 | |||||||||
4,582 | Red Lion Hotels Corp.* | 43,483 | |||||||||
1,560 | Red Robin Gourmet Burgers, Inc.* | 64,085 | |||||||||
8,292 | Restoration Hardware, Inc.* | 36,070 | |||||||||
22,901 | Retail Ventures, Inc.* | 117,482 | |||||||||
2,695 | Rex Stores Corp.* | 43,632 | |||||||||
22,546 | Ruby Tuesday, Inc. | 191,866 | |||||||||
6,793 | Russ Berrie & Co., Inc.* | 95,238 | |||||||||
5,933 | Saga Communications, Inc., Class A* | 32,632 | |||||||||
12,030 | Salem Communications Corp., Class A | 40,902 | |||||||||
10,590 | Sally Beauty Holdings, Inc.* | 64,175 | |||||||||
2,492 | Sauer-Danfoss, Inc. | 71,944 | |||||||||
5,766 | Scientific Games Corp., Class A* | 162,371 | |||||||||
5,769 | Sealy Corp. | 35,191 | |||||||||
16,021 | Select Comfort Corp.* | 48,383 | |||||||||
3,175 | Shiloh Industries, Inc. | 31,179 | |||||||||
3,932 | Shoe Carnival, Inc.* | 54,930 | |||||||||
8,908 | Sinclair Broadcast Group, Inc., Class A | 78,301 | |||||||||
110,654 | Six Flags, Inc.* | 199,177 | |||||||||
6,162 | Skechers U.S.A., Inc., Class A* | 145,731 | |||||||||
1,991 | Skyline Corp. | 54,792 | |||||||||
4,153 | Sonic Corp.* | 91,324 | |||||||||
2,312 | Sotheby's | 64,042 | |||||||||
62,758 | Source Interlink Cos., Inc.* | 88,489 | |||||||||
38,487 | Spanish Broadcasting System, Inc., Class A* | 63,504 | |||||||||
2,108 | Speedway Motorsports, Inc. | 54,892 | |||||||||
10,247 | Stage Stores, Inc. | 161,288 | |||||||||
9,551 | Standard Motor Products, Inc. | 58,070 | |||||||||
2,712 | Stanley Furniture Co., Inc. | 33,303 | |||||||||
8,260 | Steak n Shake (The) Co.* | 65,419 | |||||||||
16,886 | Stein Mart, Inc. | 90,002 | |||||||||
1,552 | Steiner Leisure Ltd.* | 51,356 | |||||||||
2,082 | Steinway Musical Instruments* | 60,378 | |||||||||
3,148 | Steven Madden Ltd.* | 59,529 | |||||||||
16,682 | Stewart Enterprises, Inc., Class A | 113,938 | |||||||||
3,956 | Stoneridge, Inc.* | 57,639 | |||||||||
340 | Strayer Education, Inc. | 63,135 | |||||||||
5,484 | Sturm Ruger & Co., Inc.* | 41,240 | |||||||||
7,662 | Superior Industries International, Inc. | 155,615 | |||||||||
59,341 | Syntax-Brillian Corp.* | 72,396 | |||||||||
4,396 | Systemax, Inc. | 70,336 | |||||||||
12,783 | Tarragon Corp.* | 31,191 | |||||||||
4,801 | Tempur-Pedic International, Inc. | 53,339 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
5,743 | Texas Roadhouse, Inc., Class A* | $ | 67,767 | ||||||||
5,783 | Tim Hortons, Inc. (Canada) | 198,646 | |||||||||
2,481 | Town Sports International Holdings, Inc.* | 18,409 | |||||||||
5,713 | Tractor Supply Co.* | 203,154 | |||||||||
25,172 | Trans World Entertainment Corp.* | 91,374 | |||||||||
3,103 | Triarc Cos., Inc., Class A | 21,473 | |||||||||
6,791 | Triarc Cos., Inc., Class B | 48,216 | |||||||||
29,795 | Trump Entertainment Resorts, Inc.* | 83,128 | |||||||||
13,837 | Tuesday Morning Corp.* | 75,273 | |||||||||
3,033 | Tween Brands, Inc.* | 57,627 | |||||||||
1,332 | Ulta Salon Cosmetics & Fragrance, Inc.* | 18,848 | |||||||||
1,015 | Under Armour, Inc., Class A* | 33,830 | |||||||||
32,201 | Unifi, Inc.* | 96,281 | |||||||||
2,728 | UniFirst Corp. | 127,698 | |||||||||
2,848 | Universal Technical Institute, Inc.* | 32,296 | |||||||||
4,561 | Urban Outfitters, Inc.* | 156,214 | |||||||||
1,606 | Vail Resorts, Inc.* | 78,421 | |||||||||
12,607 | Valassis Communications, Inc.* | 179,019 | |||||||||
7,780 | ValueVision Media, Inc., Class A* | 43,490 | |||||||||
2,803 | Velcro Industries N.V. (Netherlands) | 53,257 | |||||||||
4,885 | Warnaco Group (The), Inc.* | 225,395 | |||||||||
1,714 | Weight Watchers International, Inc. | 78,604 | |||||||||
7,510 | West Marine, Inc.* | 37,550 | |||||||||
44,941 | Westwood One, Inc.* | 75,051 | |||||||||
17,534 | Wet Seal (The), Inc., Class A* | 60,843 | |||||||||
1,255 | Weyco Group, Inc, | 34,274 | |||||||||
32,035 | Wilsons The Leather Experts, Inc.* | 4,462 | |||||||||
4,892 | Winnebago Industries, Inc. | 78,712 | |||||||||
1,785 | WMS Industries, Inc.* | 64,599 | |||||||||
5,103 | Wolverine World Wide, Inc. | 146,660 | |||||||||
5,472 | World Wrestling Entertainment, Inc., Class A | 96,581 | |||||||||
594 | Wynn Resorts Ltd. | 62,572 | |||||||||
24,048,797 | |||||||||||
Consumer Staples—3.2% | |||||||||||
24,879 | Alliance One International, Inc.* | 153,006 | |||||||||
2,055 | Andersons (The), Inc. | 93,400 | |||||||||
387 | Arden Group, Inc., Class A | 51,858 | |||||||||
5,238 | B&G Foods, Inc., Class A | 42,323 | |||||||||
2,974 | Bare Escentuals, Inc.* | 67,837 | |||||||||
940 | Boston Beer Co., Inc., Class A* | 41,642 | |||||||||
1,085 | Cal-Maine Foods, Inc. | 32,062 | |||||||||
1,745 | Central European Distribution Corp.* | 106,305 | |||||||||
14,081 | Central Garden & Pet Co.* | 72,517 | |||||||||
28,667 | Central Garden & Pet Co., Class A* | 143,908 | |||||||||
345 | Chattem, Inc.* | 24,109 | |||||||||
3,997 | Church & Dwight Co., Inc. | 227,109 | |||||||||
1,752 | Coca-Cola Bottling Co. Consolidated | 100,249 | |||||||||
3,480 | Darling International, Inc.* | 53,140 | |||||||||
3,721 | Diamond Foods, Inc. | 79,481 | |||||||||
6,714 | Elizabeth Arden, Inc.* | 124,276 |
See Notes to Financial Statements.
54
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
1,010 | Farmer Bros. Co. | $ | 24,967 | ||||||||
8,296 | Flowers Foods, Inc. | 214,783 | |||||||||
4,838 | Hain Celestial Group, Inc.* | 119,402 | |||||||||
1,102 | Hansen Natural Corp.* | 39,000 | |||||||||
1,724 | Herbalife Ltd. (Cayman Islands) | 75,477 | |||||||||
4,902 | Imperial Sugar Co. | 77,305 | |||||||||
4,240 | Ingles Markets, Inc., Class A | 96,757 | |||||||||
813 | Inter Parfums, Inc. | 23,544 | |||||||||
1,975 | J & J Snack Foods Corp. | 56,564 | |||||||||
5,998 | John B. Sanfilippo & Son, Inc.* | 64,359 | |||||||||
4,159 | Lancaster Colony Corp. | 158,832 | |||||||||
5,845 | Lance, Inc. | 122,511 | |||||||||
3,214 | Mannatech, Inc. | 20,987 | |||||||||
2,949 | National Beverage Corp. | 23,769 | |||||||||
7,090 | Nu Skin Enterprises, Inc., Class A | 127,124 | |||||||||
6,300 | Prestige Brands Holdings, Inc.* | 56,574 | |||||||||
2,322 | PriceSmart, Inc. | 66,293 | |||||||||
3,130 | Ralcorp Holdings, Inc.* | 191,055 | |||||||||
2,787 | Reddy Ice Holdings, Inc. | 36,900 | |||||||||
2,476 | Sanderson Farms, Inc. | 103,175 | |||||||||
1,726 | Seneca Foods Corp., Class A* | 35,383 | |||||||||
1,752 | Seneca Foods Corp., Class B* | 35,671 | |||||||||
5,950 | Spartan Stores, Inc. | 124,236 | |||||||||
49,962 | Spectrum Brands, Inc.* | 224,329 | |||||||||
2,958 | Susser Holdings Corp.* | 45,228 | |||||||||
3,931 | Tootsie Roll Industries, Inc. | 95,641 | |||||||||
5,995 | TreeHouse Foods, Inc.* | 135,907 | |||||||||
11,509 | United Natural Foods, Inc.* | 227,877 | |||||||||
907 | USANA Health Sciences, Inc.* | 17,687 | |||||||||
4,665 | Vector Group Ltd. | 80,378 | |||||||||
1,161 | Village Super Market, Inc., Class A | 54,671 | |||||||||
2,121 | WD-40 Co. | 66,006 | |||||||||
4,255,614 | |||||||||||
Energy—6.7% | |||||||||||
2,119 | Adams Resources & Energy, Inc. | 62,616 | |||||||||
2,242 | Allis-Chalmers Energy, Inc.* | 35,939 | |||||||||
3,575 | Alpha Natural Resources, Inc.* | 173,924 | |||||||||
2,319 | Arlington Tankers Ltd. (Bermuda) | 51,876 | |||||||||
1,003 | Atlas America, Inc. | 69,769 | |||||||||
1,143 | ATP Oil & Gas Corp.* | 32,850 | |||||||||
1,124 | Atwood Oceanics, Inc.* | 113,176 | |||||||||
14,523 | Aventine Renewable Energy Holdings* | 63,756 | |||||||||
4,860 | Basic Energy Services, Inc.* | 112,752 | |||||||||
2,546 | Berry Petroleum Co., Class A | 126,078 | |||||||||
1,278 | Bill Barrett Corp.* | 65,728 | |||||||||
1,328 | Bois d'Arc Energy, Inc.* | 31,739 | |||||||||
6,606 | Brigham Exploration Co.* | 62,361 | |||||||||
2,785 | Bristow Group, Inc.* | 146,909 | |||||||||
1,661 | Bronco Drilling Co., Inc.* | 28,569 | |||||||||
3,746 | Cabot Oil & Gas Corp. | 213,410 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
2,633 | Cal Dive International, Inc.* | $ | 32,096 | ||||||||
3,558 | Callon Petroleum Co.* | 71,160 | |||||||||
1,397 | CARBO Ceramics, Inc. | 66,399 | |||||||||
709 | Carrizo Oil & Gas, Inc.* | 45,014 | |||||||||
723 | Clayton Williams Energy, Inc.* | 45,686 | |||||||||
969 | CNX Gas Corp.* | 39,768 | |||||||||
7,047 | Complete Production Services, Inc.* | 190,339 | |||||||||
4,357 | Comstock Resources, Inc.* | 198,200 | |||||||||
1,468 | Continental Resources, Inc.* | 63,080 | |||||||||
2,587 | Copano Energy LLC | 95,926 | |||||||||
494 | Core Laboratories N.V. (Netherlands)* | 61,888 | |||||||||
3,102 | Crosstex Energy, Inc. | 107,360 | |||||||||
3,625 | Delek US Holdings, Inc. | 39,984 | |||||||||
1,706 | Delta Petroleum Corp.* | 41,865 | |||||||||
3,586 | Double Hull Tankers, Inc. (Scotland) | 36,757 | |||||||||
5,494 | Dresser-Rand Group, Inc.* | 200,916 | |||||||||
1,322 | Dril-Quip, Inc.* | 75,566 | |||||||||
8,004 | Edge Petroleum Corp.* | 41,781 | |||||||||
3,660 | Encore Acquisition Co.* | 167,006 | |||||||||
10,360 | Energy Partners Ltd.* | 125,874 | |||||||||
6,967 | EXCO Resources, Inc.* | 155,503 | |||||||||
6,193 | Global Industries Ltd.* | 98,840 | |||||||||
22,969 | Grey Wolf, Inc.* | 144,016 | |||||||||
1,202 | Gulf Island Fabrication, Inc. | 47,527 | |||||||||
1,715 | GulfMark Offshore, Inc.* | 102,557 | |||||||||
4,883 | Harvest Natural Resources, Inc.* | 46,340 | |||||||||
3,997 | Hercules Offshore, Inc.* | 105,361 | |||||||||
3,011 | Holly Corp. | 124,896 | |||||||||
1,854 | Hornbeck Offshore Services, Inc.* | 92,459 | |||||||||
22,341 | International Coal Group, Inc.* | 177,834 | |||||||||
4,476 | ION Geophysical Corp.* | 71,303 | |||||||||
2,946 | James River Coal Co.* | 65,490 | |||||||||
14,942 | Key Energy Services, Inc.* | 204,705 | |||||||||
4,090 | Kinder Morgan Management LLC* | 222,911 | |||||||||
5,765 | Knightsbridge Tankers Ltd. (Bermuda) | 166,378 | |||||||||
1,788 | Linn Energy LLC | 39,175 | |||||||||
1,145 | Lufkin Industries, Inc. | 86,390 | |||||||||
7,519 | Mariner Energy, Inc.* | 207,224 | |||||||||
2,406 | Matrix Service Co.* | 48,385 | |||||||||
56,392 | Meridian Resource Corp.* | 119,551 | |||||||||
1,045 | NATCO Group, Inc., Class A* | 52,877 | |||||||||
18,155 | Newpark Resources, Inc.* | 99,671 | |||||||||
6,365 | Nordic American Tanker Shipping Ltd. (Bermuda) | 214,628 | |||||||||
2,940 | Oceaneering International, Inc.* | 196,333 | |||||||||
2,006 | Oil States International, Inc.* | 100,420 | |||||||||
18,125 | Parker Drilling Co.* | 145,363 | |||||||||
2,755 | Penn Virginia Corp. | 144,638 | |||||||||
1,012 | Petroleum Development Corp.* | 76,133 | |||||||||
3,191 | PetroQuest Energy, Inc.* | 66,309 | |||||||||
2,563 | PHI, Inc.* | 96,292 |
See Notes to Financial Statements.
55
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
5,926 | Pioneer Drilling Co.* | $ | 96,772 | ||||||||
1,061 | Quicksilver Resources, Inc.* | 44,021 | |||||||||
3,013 | Range Resources Corp. | 200,003 | |||||||||
7,976 | Rosetta Resources, Inc.* | 173,797 | |||||||||
2,472 | RPC, Inc. | 31,567 | |||||||||
857 | SandRidge Energy, Inc.* | 38,719 | |||||||||
4,651 | St. Mary Land & Exploration Co. | 203,342 | |||||||||
3,304 | Superior Energy Services, Inc.* | 146,632 | |||||||||
1,083 | Superior Well Services, Inc.* | 25,786 | |||||||||
3,852 | Swift Energy Co.* | 200,843 | |||||||||
6,041 | TETRA Technologies, Inc.* | 98,227 | |||||||||
15,452 | TOP Ships, Inc. (Greece)* | 129,797 | |||||||||
459 | Trico Marine Services, Inc.* | 17,300 | |||||||||
3,511 | Tsakos Energy Navigation Ltd. (Bermuda) | 114,108 | |||||||||
2,129 | Ultra Petroleum Corp.* | 176,856 | |||||||||
828 | Union Drilling, Inc.* | 14,001 | |||||||||
2,133 | Venoco, Inc.* | 32,059 | |||||||||
8,105 | VeraSun Energy Corp.* | 50,575 | |||||||||
2,396 | W&T Offshore, Inc. | 97,996 | |||||||||
4,249 | Western Refining, Inc. | 42,532 | |||||||||
2,012 | W-H Energy Services, Inc.* | 155,507 | |||||||||
1,256 | Willbros Group, Inc.* | 45,329 | |||||||||
8,793,395 | |||||||||||
Financials—22.3% | |||||||||||
3,187 | 1st Source Corp. | 63,166 | |||||||||
2,875 | Acadia Realty Trust | 73,715 | |||||||||
12,684 | Advance America Cash Advance Centers, Inc. | 111,746 | |||||||||
2,360 | Advanta Corp., Class A | 17,912 | |||||||||
8,280 | Advanta Corp., Class B | 72,698 | |||||||||
2,042 | Affiliated Managers Group, Inc.* | 202,852 | |||||||||
4,046 | Affirmative Insurance Holdings, Inc. | 31,680 | |||||||||
1,437 | Agree Realty Corp. | 38,282 | |||||||||
3,508 | AmCOMP, Inc.* | 43,219 | |||||||||
5,067 | AMCORE Financial, Inc. | 63,033 | |||||||||
1,997 | American Campus Communities, Inc. | 60,968 | |||||||||
11,069 | American Equity Investment Life Holding Co. | 106,816 | |||||||||
25,871 | American Mortgage Acceptance Co. | 32,597 | |||||||||
1,041 | American Physicians Capital, Inc. | 48,250 | |||||||||
2,570 | Ameris Bancorp | 38,499 | |||||||||
3,140 | Amerisafe, Inc.* | 44,776 | |||||||||
1,424 | Amtrust Financial Services, Inc. | 22,143 | |||||||||
4,433 | Anchor BanCorp Wisconsin, Inc. | 67,337 | |||||||||
29,306 | Anthracite Capital, Inc. | 228,587 | |||||||||
11,988 | Anworth Mortgage Asset Corp. | 80,080 | |||||||||
4,734 | Arbor Realty Trust, Inc. | 81,756 | |||||||||
11,609 | Ares Capital Corp. | 130,717 | |||||||||
878 | Argo Group International Holdings Ltd. (Bermuda)* | 31,450 | |||||||||
1,830 | Arrow Financial Corp. | 42,566 | |||||||||
14,695 | Ashford Hospitality Trust, Inc. | 85,084 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
3,284 | Asset Acceptance Capital Corp. | $ | 39,572 | ||||||||
3,978 | Associated Estates Realty Corp. | 48,134 | |||||||||
6,335 | Assured Guaranty Ltd. (Bermuda) | 160,212 | |||||||||
2,578 | Asta Funding, Inc. | 36,788 | |||||||||
1,917 | Baldwin & Lyons, Inc., Class B | 45,567 | |||||||||
698 | BancFirst Corp. | 30,524 | |||||||||
10,716 | Banco Latinoamericano de Exportaciones, S.A., Class E (Panama) | 201,461 | |||||||||
3,816 | Bank Mutual Corp. | 42,701 | |||||||||
2,908 | Bank of Granite Corp. | 30,534 | |||||||||
1,209 | Bank of the Ozarks, Inc. | 30,165 | |||||||||
21,386 | BankAtlantic Bancorp, Inc., Class A | 65,869 | |||||||||
2,269 | BankFinancial Corp. | 36,395 | |||||||||
23,547 | BankUnited Financial Corp., Class A | 92,540 | |||||||||
2,432 | Banner Corp. | 52,531 | |||||||||
1,749 | Beneficial Mutual Bancorp, Inc.* | 17,857 | |||||||||
1,550 | Berkshire Hills Bancorp, Inc. | 39,665 | |||||||||
6,783 | BGC Partners, Inc. Class A* | 65,388 | |||||||||
6,670 | BioMed Realty Trust, Inc. | 173,420 | |||||||||
5,675 | BlackRock Kelso Capital Corp. | 69,859 | |||||||||
6,565 | Boston Private Financial Holdings, Inc. | 61,055 | |||||||||
13,025 | Brookline Bancorp, Inc. | 140,670 | |||||||||
11,443 | Brown & Brown, Inc. | 219,706 | |||||||||
2,205 | BRT Realty Trust | 33,251 | |||||||||
2,655 | Cadence Financial Corp. | 39,586 | |||||||||
3,743 | Calamos Asset Management, Inc., Class A | 67,187 | |||||||||
988 | California First National Bancorp | 9,781 | |||||||||
1,066 | Camden National Corp. | 35,370 | |||||||||
1,726 | Capital City Bank Group, Inc. | 45,308 | |||||||||
386 | Capital Southwest Corp. | 45,911 | |||||||||
4,082 | Capital Trust, Inc., Class A | 109,194 | |||||||||
2,800 | Capitol Bancorp Ltd. | 48,132 | |||||||||
1,659 | Capitol Federal Financial | 64,203 | |||||||||
5,340 | CapLease, Inc. | 44,375 | |||||||||
7,484 | Capstead Mortgage Corp. | 96,544 | |||||||||
4,153 | Cascade Bancorp | 37,875 | |||||||||
2,593 | Cash America International, Inc. | 105,768 | |||||||||
6,723 | Cathay General Bancorp | 114,627 | |||||||||
8,558 | CBRE Realty Finance, Inc. | 33,205 | |||||||||
5,813 | Cedar Shopping Centers, Inc. | 72,663 | |||||||||
12,047 | Centennial Bank Holdings, Inc.* | 75,414 | |||||||||
6,170 | Central Pacific Financial Corp. | 113,281 | |||||||||
5,400 | Chemical Financial Corp. | 131,112 | |||||||||
3,630 | City Bank | 65,776 | |||||||||
2,034 | City Holding Co. | 84,574 | |||||||||
4,647 | Clayton Holdings, Inc.* | 26,860 | |||||||||
2,329 | CNA Surety Corp.* | 30,813 | |||||||||
551 | Cohen & Steers, Inc. | 15,384 | |||||||||
1,878 | Columbia Banking System, Inc. | 50,856 | |||||||||
4,746 | Community Bank System, Inc. | 120,976 | |||||||||
2,533 | Community Trust Bancorp, Inc. | 76,142 |
See Notes to Financial Statements.
56
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
2,227 | Compass Diversified Holdings | $ | 27,303 | ||||||||
7,919 | Consumer Portfolio Services, Inc.* | 22,965 | |||||||||
4,808 | Corporate Office Properties Trust | 179,338 | |||||||||
13,379 | Corus Bankshares, Inc. | 98,068 | |||||||||
5,965 | Cowen Group, Inc.* | 39,667 | |||||||||
7,314 | Crawford & Co., Class A* | 31,085 | |||||||||
11,636 | Crawford & Co., Class B* | 60,391 | |||||||||
1,402 | Credit Acceptance Corp.* | 26,989 | |||||||||
8,454 | Crystal River Capital, Inc. | 69,746 | |||||||||
12,466 | CVB Financial Corp. | 143,110 | |||||||||
18,986 | DCT Industrial Trust, Inc. | 189,860 | |||||||||
24,586 | Deerfield Triarc Capital Corp. | 34,420 | |||||||||
7,030 | Delphi Financial Group, Inc., Class A | 191,357 | |||||||||
8,241 | DiamondRock Hospitality Co. | 105,073 | |||||||||
2,268 | Digital Realty Trust, Inc. | 87,885 | |||||||||
5,299 | Dime Community Bancshares, Inc. | 98,932 | |||||||||
3,177 | Dollar Financial Corp.* | 68,560 | |||||||||
2,663 | Donegal Group, Inc., Class A | 45,244 | |||||||||
5,060 | Douglas Emmett, Inc. | 120,226 | |||||||||
8,347 | East West Bancorp, Inc. | 118,861 | |||||||||
2,895 | EastGroup Properties, Inc. | 138,120 | |||||||||
6,592 | Eaton Vance Corp. | 241,266 | |||||||||
3,544 | Education Realty Trust, Inc. | 47,277 | |||||||||
569 | EMC Insurance Group, Inc. | 16,615 | |||||||||
6,945 | Employers Holdings, Inc. | 132,511 | |||||||||
4,994 | Encore Capital Group, Inc.* | 33,460 | |||||||||
440 | Enstar Group Ltd. (Bermuda)* | 47,846 | |||||||||
3,601 | Entertainment Properties Trust | 192,149 | |||||||||
3,012 | Equity Lifestyle Properties, Inc. | 148,913 | |||||||||
2,017 | Essex Property Trust, Inc. | 240,022 | |||||||||
2,353 | Evercore Partners, Inc., Class A | 39,672 | |||||||||
5,978 | Extra Space Storage, Inc. | 100,610 | |||||||||
4,318 | EZCORP, Inc., Class A* | 52,421 | |||||||||
17,629 | F.N.B. Corp. | 272,543 | |||||||||
1,591 | Farmers Capital Bank Corp. | 39,011 | |||||||||
2,752 | FBL Financial Group, Inc., Class A | 76,203 | |||||||||
6,657 | FBR Capital Markets Corp.* | 43,271 | |||||||||
894 | FCStone Group, Inc.* | 37,029 | |||||||||
1,723 | Federal Agricultural Mortgage Corp., Class C | 55,136 | |||||||||
11,104 | FelCor Lodging Trust, Inc. | 139,799 | |||||||||
3,134 | Financial Federal Corp. | 73,179 | |||||||||
1,629 | Financial Institutions, Inc. | 31,782 | |||||||||
4,663 | First Acceptance Corp.* | 14,502 | |||||||||
2,501 | First BanCorp | 47,069 | |||||||||
21,412 | First BanCorp | 220,329 | |||||||||
2,677 | First Busey Corp. | 53,085 | |||||||||
4,475 | First Cash Financial Services, Inc.* | 66,409 | |||||||||
4,479 | First Charter Corp. | 136,072 | |||||||||
1,140 | First Citizens BancShares, Inc., Class A | 160,478 | |||||||||
15,109 | First Commonwealth Financial Corp. | 188,107 | |||||||||
5,034 | First Community Bancorp | 108,181 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
1,686 | First Community Bancshares, Inc. | $ | 56,346 | ||||||||
6,805 | First Financial Bancorp | 89,282 | |||||||||
2,248 | First Financial Bankshares, Inc. | 101,138 | |||||||||
1,667 | First Financial Corp. | 53,011 | |||||||||
2,486 | First Financial Holdings, Inc. | 59,689 | |||||||||
8,234 | First Marblehead (The) Corp. | 30,466 | |||||||||
2,894 | First Merchants Corp. | 74,000 | |||||||||
1,809 | First Mercury Financial Corp.* | 28,582 | |||||||||
7,593 | First Midwest Bancorp, Inc. | 193,849 | |||||||||
18,461 | First Niagara Financial Group, Inc. | 266,391 | |||||||||
4,540 | First Place Financial Corp. | 56,750 | |||||||||
3,461 | First Potomac Realty Trust | 58,802 | |||||||||
3,703 | First State Bancorp | 34,438 | |||||||||
4,383 | FirstFed Financial Corp.* | 66,972 | |||||||||
5,984 | Flagstone Reinsurance Holdings Ltd. (Bermuda) | 73,184 | |||||||||
2,628 | Flushing Financial Corp. | 51,299 | |||||||||
6,114 | Forest City Enterprises, Inc., Class A | 225,851 | |||||||||
1,387 | FPIC Insurance Group, Inc.* | 64,537 | |||||||||
13,718 | Franklin Bank Corp.* | 21,263 | |||||||||
15,310 | Franklin Street Properties Corp. | 226,129 | |||||||||
6,072 | Frontier Financial Corp. | 97,152 | |||||||||
1,710 | GAMCO Investors, Inc., Class A | 78,677 | |||||||||
3,215 | Getty Realty Corp. | 58,224 | |||||||||
2,277 | GFI Group, Inc. | 26,755 | |||||||||
5,632 | Glacier Bancorp, Inc. | 115,907 | |||||||||
3,178 | Gladstone Capital Corp. | 59,683 | |||||||||
15,057 | Glimcher Realty Trust | 180,684 | |||||||||
6,257 | GMH Communities Trust | 59,066 | |||||||||
1,736 | Great Southern Bancorp, Inc. | 26,179 | |||||||||
1,934 | Green Bankshares, Inc. | 38,738 | |||||||||
681 | Greenhill & Co., Inc. | 44,299 | |||||||||
4,346 | Grubb & Ellis Co. | 26,684 | |||||||||
3,328 | Hancock Holding Co. | 137,347 | |||||||||
7,353 | Hanmi Financial Corp. | 51,397 | |||||||||
4,438 | Harleysville Group, Inc. | 161,765 | |||||||||
5,825 | Harleysville National Corp. | 84,230 | |||||||||
2,570 | Heartland Financial USA, Inc. | 57,825 | |||||||||
5,207 | Hersha Hospitality Trust | 49,571 | |||||||||
4,580 | Hilb Rogal & Hobbs Co. | 132,499 | |||||||||
4,216 | Hilltop Holdings, Inc.* | 44,521 | |||||||||
8,046 | Horace Mann Educators Corp. | 136,138 | |||||||||
1,257 | IBERIABANK Corp. | 60,587 | |||||||||
1,735 | Imperial Capital Bancorp, Inc. | 26,146 | |||||||||
1,634 | Independence Holding Co. | 21,896 | |||||||||
2,298 | Independent Bank Corp. | 67,171 | |||||||||
7,236 | Independent Bank Corp. | 57,743 | |||||||||
2,779 | Infinity Property & Casualty Corp. | 107,714 | |||||||||
9,315 | Inland Real Estate Corp. | 150,437 | |||||||||
4,402 | Integra Bank Corp. | 64,313 | |||||||||
513 | IntercontinentalExchange, Inc.* | 79,592 |
See Notes to Financial Statements.
57
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
7,311 | International Bancshares Corp. | $ | 182,702 | ||||||||
3,969 | Invesco Ltd. | 101,805 | |||||||||
2,709 | Investment Technology Group, Inc.* | 130,736 | |||||||||
3,631 | Investors Bancorp, Inc.* | 53,267 | |||||||||
9,843 | Investors Real Estate Trust | 100,399 | |||||||||
4,686 | Irwin Financial Corp. | 27,366 | |||||||||
6,180 | JER Investors Trust, Inc. | 47,586 | |||||||||
2,234 | Jones Lang LaSalle, Inc. | 173,381 | |||||||||
826 | Kansas City Life Insurance Co. | 41,300 | |||||||||
1,896 | KBW, Inc.* | 45,011 | |||||||||
1,390 | Kearny Financial Corp. | 15,123 | |||||||||
3,988 | Kilroy Realty Corp. | 208,652 | |||||||||
3,664 | Kite Realty Group Trust | 49,757 | |||||||||
10,802 | Knight Capital Group, Inc., Class A* | 202,105 | |||||||||
25,125 | LaBranche & Co., Inc.* | 160,549 | |||||||||
3,634 | Lakeland Bancorp, Inc. | 56,291 | |||||||||
5,029 | LaSalle Hotel Properties | 161,280 | |||||||||
4,046 | Lazard Ltd., Class A (Bermuda) | 158,360 | |||||||||
15,026 | Lexington Realty Trust | 216,374 | |||||||||
3,325 | LTC Properties, Inc. | 90,540 | |||||||||
181,101 | Luminent Mortgage Capital, Inc.+ | 47,086 | |||||||||
3,635 | Macatawa Bank Corp. | 41,330 | |||||||||
6,502 | Maguire Properties, Inc. | 104,682 | |||||||||
3,232 | MainSource Financial Group, Inc. | 47,866 | |||||||||
6,440 | Max Capital Group Ltd. (Bermuda) | 150,760 | |||||||||
4,771 | MB Financial, Inc. | 136,928 | |||||||||
5,263 | MBT Financial Corp. | 49,314 | |||||||||
17,268 | MCG Capital Corp. | 132,273 | |||||||||
5,481 | Meadowbrook Insurance Group, Inc. | 39,682 | |||||||||
6,123 | Medical Properties Trust, Inc. | 74,394 | |||||||||
1,134 | Merchants Bancshares, Inc. | 26,558 | |||||||||
17,450 | MFA Mortgage Investments, Inc. | 121,976 | |||||||||
3,214 | Mid-America Apartment Communities, Inc. | 168,735 | |||||||||
3,752 | Midwest Banc Holdings, Inc. | 38,571 | |||||||||
7,825 | Mission West Properties, Inc. | 93,039 | |||||||||
1,439 | MSCI, Inc., Class A* | 44,638 | |||||||||
22,197 | Municipal Mortgage & Equity LLC | 88,788 | |||||||||
3,086 | Nara Bancorp, Inc. | 40,519 | |||||||||
793 | NASB Financial, Inc. | 22,585 | |||||||||
5,972 | National Financial Partners Corp. | 160,766 | |||||||||
4,975 | National Health Investors, Inc. | 152,185 | |||||||||
7,397 | National Penn Bancshares, Inc. | 123,456 | |||||||||
10,355 | National Retail Properties, Inc. | 237,232 | |||||||||
637 | National Western Life Insurance Co., Class A | 161,556 | |||||||||
1,250 | Navigators Group (The), Inc.* | 61,250 | |||||||||
5,691 | NBT Bancorp, Inc. | 129,641 | |||||||||
12,997 | NewAlliance Bancshares, Inc. | 174,940 | |||||||||
2,470 | NewStar Financial, Inc.* | 13,289 | |||||||||
7,813 | NorthStar Realty Finance Corp. | 81,021 | |||||||||
1,153 | Northwest Bancorp, Inc. | 29,747 | |||||||||
1,138 | NYMAGIC, Inc. | 25,890 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
1,940 | OceanFirst Financial Corp. | $ | 36,530 | ||||||||
15,731 | Ocwen Financial Corp.* | 77,711 | |||||||||
13,740 | Old National Bancorp | 235,090 | |||||||||
1,566 | Old Second Bancorp, Inc. | 38,414 | |||||||||
5,910 | Omega Healthcare Investors, Inc. | 103,425 | |||||||||
2,195 | One Liberty Properties, Inc. | 38,039 | |||||||||
1,588 | optionsXpress Holdings, Inc. | 34,094 | |||||||||
3,176 | Oriental Financial Group | 59,709 | |||||||||
1,204 | Oritani Financial Corp.* | 18,265 | |||||||||
8,357 | Pacific Capital Bancorp | 170,316 | |||||||||
3,168 | Park National Corp. | 240,799 | |||||||||
3,161 | Parkway Properties, Inc. | 125,365 | |||||||||
8,959 | Penn Treaty American Corp.* | 44,616 | |||||||||
2,633 | Penson Worldwide, Inc.* | 28,647 | |||||||||
1,974 | Peoples Bancorp, Inc. | 47,909 | |||||||||
7,782 | PFF Bancorp, Inc. | 29,416 | |||||||||
1,050 | Pico Holdings, Inc.* | 37,086 | |||||||||
4,234 | Piper Jaffray Cos.* | 157,759 | |||||||||
6,679 | PMA Capital Corp., Class A* | 61,981 | |||||||||
3,595 | PMC Commercial Trust | 25,237 | |||||||||
1,236 | Portfolio Recovery Associates, Inc. | 54,396 | |||||||||
4,546 | Presidential Life Corp. | 77,100 | |||||||||
11,747 | Primus Guaranty Ltd. (Bermuda)* | 52,392 | |||||||||
1,545 | PrivateBancorp, Inc. | 52,515 | |||||||||
3,461 | ProAssurance Corp.* | 183,191 | |||||||||
2,700 | Prospect Capital Corp. | 40,068 | |||||||||
2,423 | Prosperity Bancshares, Inc. | 75,040 | |||||||||
12,279 | Provident Bankshares Corp. | 157,294 | |||||||||
10,289 | Provident Financial Services, Inc. | 158,759 | |||||||||
4,065 | Provident New York Bancorp | 54,308 | |||||||||
1,991 | PS Business Parks, Inc. | 113,965 | |||||||||
27,907 | RAIT Financial Trust | 212,093 | |||||||||
22,840 | RAM Holdings Ltd. (Bermuda)* | 39,285 | |||||||||
3,713 | Ramco-Gershenson Properties Trust | 83,431 | |||||||||
2,307 | Renasant Corp. | 53,453 | |||||||||
3,100 | Republic Bancorp, Inc., Class A | 71,703 | |||||||||
4,161 | Resource Capital Corp. | 36,159 | |||||||||
5,351 | Rewards Network, Inc.* | 25,792 | |||||||||
2,453 | RLI Corp. | 117,744 | |||||||||
1,734 | Royal Bancshares of Pennsylvania, Class A | 18,814 | |||||||||
3,957 | S&T Bancorp, Inc. | 134,815 | |||||||||
1,515 | S.Y. Bancorp, Inc. | 37,314 | |||||||||
2,771 | Safety Insurance Group, Inc. | 99,479 | |||||||||
2,197 | Sandy Spring Bancorp, Inc. | 56,024 | |||||||||
2,562 | Santander BanCorp | 28,976 | |||||||||
1,025 | Saul Centers, Inc. | 51,148 | |||||||||
1,168 | SCBT Financial Corp. | 39,677 | |||||||||
2,972 | SeaBright Insurance Holdings, Inc.* | 46,125 | |||||||||
4,575 | Seacoast Banking Corp. of Florida | 48,083 | |||||||||
5,554 | Security Bank Corp. | 42,655 | |||||||||
5,916 | SEI Investments Co. | 137,665 |
See Notes to Financial Statements.
58
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
2,054 | Signature Bank* | $ | 54,185 | ||||||||
2,299 | Silver State Bancorp* | 9,047 | |||||||||
2,144 | Simmons First National Corp., Class A | 68,629 | |||||||||
2,395 | Southwest Bancorp, Inc. | 42,152 | |||||||||
3,457 | Sovran Self Storage, Inc. | 154,528 | |||||||||
5,760 | St. Joe (The) Co. | 234,259 | |||||||||
5,470 | State Auto Financial Corp. | 150,699 | |||||||||
4,045 | StellarOne Corp. | 65,165 | |||||||||
3,482 | Sterling Bancorp | 57,140 | |||||||||
8,161 | Sterling Bancshares, Inc. | 84,793 | |||||||||
7,185 | Sterling Financial Corp. of Spokane | 87,729 | |||||||||
876 | Stifel Financial Corp.* | 41,409 | |||||||||
10,931 | Strategic Hotels & Resorts, Inc. | 157,516 | |||||||||
1,282 | Suffolk Bancorp | 41,511 | |||||||||
3,149 | Sun Bancorp, Inc.* | 36,497 | |||||||||
4,933 | Sun Communities, Inc. | 95,947 | |||||||||
10,149 | Sunstone Hotel Investors, Inc. | 189,583 | |||||||||
10,217 | Susquehanna Bancshares, Inc. | 203,216 | |||||||||
2,651 | SVB Financial Group* | 128,998 | |||||||||
7,015 | SWS Group, Inc. | 92,037 | |||||||||
2,842 | Tanger Factory Outlet Centers, Inc. | 114,646 | |||||||||
2,655 | Taubman Centers, Inc. | 150,459 | |||||||||
1,339 | Taylor Capital Group, Inc. | 19,978 | |||||||||
2,930 | Texas Capital Bancshares, Inc.* | 54,059 | |||||||||
5,825 | Thomas Weisel Partners Group, Inc.* | 38,387 | |||||||||
3,647 | TICC Capital Corp. | 26,550 | |||||||||
3,429 | TierOne Corp. | 30,724 | |||||||||
889 | Tompkins Financial Corp. | 43,001 | |||||||||
8,042 | Triad Guaranty, Inc.* | 18,336 | |||||||||
2,436 | Trico Bancshares | 41,436 | |||||||||
15,516 | Trustco Bank Corp. | 135,455 | |||||||||
11,706 | UCBH Holdings, Inc. | 85,220 | |||||||||
2,931 | UMB Financial Corp. | 145,495 | |||||||||
10,193 | Umpqua Holdings Corp. | 150,347 | |||||||||
2,320 | Union Bankshares Corp. | 44,451 | |||||||||
5,104 | United America Indemnity Ltd., Class A* | 78,908 | |||||||||
7,197 | United Bankshares, Inc. | 209,361 | |||||||||
7,444 | United Community Banks, Inc. | 102,206 | |||||||||
10,384 | United Community Financial Corp. | 85,253 | |||||||||
2,474 | United Fire & Casualty Co. | 81,518 | |||||||||
8,351 | United PanAm Financial Corp.* | 27,725 | |||||||||
1,961 | Universal Health Realty Income Trust | 65,772 | |||||||||
2,141 | Univest Corp. of Pennsylvania | 54,852 | |||||||||
4,942 | Urstadt Biddle Properties, Inc., Class A | 83,372 | |||||||||
10,606 | U-Store-It Trust | 128,014 | |||||||||
2,391 | Validus Holdings Ltd. | 54,395 | |||||||||
6,215 | Vestin Realty Mortgage II, Inc. | 52,828 | |||||||||
103,721 | W Holding Co., Inc. | 108,907 | |||||||||
4,828 | W.P. Carey & Co. LLC | 144,261 | |||||||||
70,522 | W.P. Stewart & Co. Ltd. (Bermuda) | 106,488 | |||||||||
5,649 | Waddell & Reed Financial, Inc., Class A | 191,275 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
5,873 | Washington REIT | $ | 208,668 | ||||||||
1,937 | Washington Trust Bancorp, Inc. | 46,837 | |||||||||
1,204 | Wauwatosa Holdings, Inc.* | 14,677 | |||||||||
4,214 | WesBanco, Inc. | 90,643 | |||||||||
3,138 | West Bancorporation, Inc. | 39,131 | |||||||||
2,731 | West Coast Bancorp | 35,257 | |||||||||
3,155 | Westamerica Bancorp | 184,378 | |||||||||
4,010 | Western Alliance Bancorp* | 51,208 | |||||||||
5,081 | Winthrop Realty Trust | 22,102 | |||||||||
3,166 | Wintrust Financial Corp. | 100,426 | |||||||||
2,313 | World Acceptance Corp.* | 91,086 | |||||||||
784 | WSFS Financial Corp. | 39,835 | |||||||||
4,788 | Zenith National Insurance Corp. | 177,826 | |||||||||
29,225,721 | |||||||||||
Health Care—7.3% | |||||||||||
7,260 | Advanced Medical Optics, Inc.* | 152,460 | |||||||||
4,745 | Affymetrix, Inc.* | 51,768 | |||||||||
909 | Air Methods Corp.* | 36,451 | |||||||||
3,721 | Albany Molecular Research, Inc.* | 43,238 | |||||||||
4,399 | Alliance Imaging, Inc.* | 35,852 | |||||||||
13,642 | Allied Healthcare International, Inc.* | 20,463 | |||||||||
2,750 | Allscripts Healthcare Solutions, Inc.* | 30,690 | |||||||||
6,540 | Alpharma, Inc., Class A* | 160,949 | |||||||||
1,524 | Amedisys, Inc.* | 78,943 | |||||||||
5,921 | America Service Group, Inc.* | 38,960 | |||||||||
3,391 | American Medical Systems Holdings, Inc.* | 47,813 | |||||||||
5,721 | AMN Healthcare Services, Inc.* | 83,469 | |||||||||
4,323 | Amsurg Corp.* | 110,409 | |||||||||
834 | Analogic Corp. | 48,030 | |||||||||
2,238 | AngioDynamics, Inc.* | 33,078 | |||||||||
2,070 | Animal Health International, Inc.* | 18,195 | |||||||||
2,865 | APP Pharmaceuticals, Inc.* | 37,417 | |||||||||
3,738 | Applera Corp. - Celera Group* | 50,014 | |||||||||
1,297 | ArthroCare Corp.* | 58,443 | |||||||||
10,211 | Assisted Living Concepts, Inc., Class A* | 74,642 | |||||||||
1,706 | Bio-Rad Laboratories, Inc., Class A* | 142,195 | |||||||||
9,823 | BioScrip, Inc.* | 54,027 | |||||||||
2,092 | Bruker Corp.* | 25,355 | |||||||||
7,401 | Cambrex Corp. | 43,296 | |||||||||
2,129 | Cantel Medical Corp.* | 20,332 | |||||||||
7,092 | Centene Corp.* | 130,280 | |||||||||
1,868 | Chemed Corp. | 63,699 | |||||||||
4,117 | CONMED Corp.* | 105,066 | |||||||||
4,915 | Cooper (The) Cos., Inc. | 172,025 | |||||||||
915 | Corvel Corp.* | 30,104 | |||||||||
8,523 | Cross Country Healthcare, Inc.* | 101,935 | |||||||||
1,390 | Datascope Corp. | 52,069 | |||||||||
794 | Dionex Corp.* | 62,107 | |||||||||
1,788 | Eclipsys Corp.* | 37,137 | |||||||||
4,580 | Edwards Lifesciences Corp.* | 253,823 |
See Notes to Financial Statements.
59
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
7,919 | Emergency Medical Services Corp., Class A* | $ | 178,732 | ||||||||
8,266 | Endo Pharmaceuticals Holdings, Inc.* | 205,245 | |||||||||
1,709 | Ensign Group (The), Inc. | 16,423 | |||||||||
6,811 | Five Star Quality Care, Inc.* | 40,866 | |||||||||
2,077 | Gen-Probe, Inc.* | 117,060 | |||||||||
6,966 | Gentiva Health Services, Inc.* | 151,441 | |||||||||
2,631 | Greatbatch, Inc.* | 47,832 | |||||||||
1,651 | Haemonetics Corp.* | 94,487 | |||||||||
5,205 | Hanger Orthopedic Group, Inc.* | 61,419 | |||||||||
2,889 | HealthExtras, Inc.* | 81,528 | |||||||||
6,844 | Healthsouth Corp.* | 134,621 | |||||||||
6,455 | Healthspring, Inc.* | 108,702 | |||||||||
14,792 | HealthTronics, Inc.* | 52,955 | |||||||||
2,518 | Healthways, Inc.* | 91,983 | |||||||||
11,523 | Hlth Corp.* | 128,136 | |||||||||
4,485 | Hologic, Inc.* | 130,917 | |||||||||
1,132 | ICU Medical, Inc.* | 28,436 | |||||||||
2,126 | IDEXX Laboratories, Inc.* | 113,103 | |||||||||
1,967 | ImClone Systems, Inc.* | 91,761 | |||||||||
1,623 | Immucor, Inc.* | 43,789 | |||||||||
1,108 | Integra LifeSciences Holdings Corp.* | 46,946 | |||||||||
294 | Intuitive Surgical, Inc.* | 85,042 | |||||||||
5,395 | Invacare Corp. | 97,326 | |||||||||
2,441 | inVentiv Health, Inc.* | 72,571 | |||||||||
3,726 | Inverness Medical Innovations, Inc.* | 137,862 | |||||||||
809 | Kendle International, Inc.* | 34,536 | |||||||||
2,830 | Kinetic Concepts, Inc.* | 112,238 | |||||||||
2,858 | KV Pharmaceutical Co., Class A* | 69,850 | |||||||||
984 | Landauer, Inc. | 52,398 | |||||||||
2,272 | LCA-Vision, Inc. | 22,970 | |||||||||
2,314 | Martek Biosciences Corp.* | 81,592 | |||||||||
2,166 | Matria Healthcare, Inc.* | 55,233 | |||||||||
3,866 | MedCath Corp.* | 71,753 | |||||||||
3,789 | Medical Staffing Network Holdings, Inc.* | 16,482 | |||||||||
3,720 | Medicis Pharmaceutical Corp., Class A | 76,632 | |||||||||
3,833 | Mentor Corp. | 112,192 | |||||||||
840 | Meridian Bioscience, Inc. | 22,621 | |||||||||
2,121 | Merit Medical Systems, Inc.* | 31,200 | |||||||||
12,154 | Millennium Pharmaceuticals, Inc.* | 302,269 | |||||||||
3,073 | Millipore Corp.* | 215,416 | |||||||||
1,802 | Molina Healthcare, Inc.* | 44,744 | |||||||||
1,516 | MWI Veterinary Supply, Inc.* | 52,257 | |||||||||
1,032 | National Healthcare Corp. | 51,693 | |||||||||
4,993 | National Medical Health Card Systems, Inc.* | 55,273 | |||||||||
4,523 | Odyssey HealthCare, Inc.* | 41,385 | |||||||||
1,843 | Orthofix International N.V. (Netherlands)* | 56,691 | |||||||||
6,124 | Par Pharmaceutical Cos., Inc.* | 104,414 | |||||||||
3,520 | Parexel International Corp.* | 89,408 | |||||||||
3,068 | PDI, Inc.* | 26,446 | |||||||||
3,091 | PDL BioPharma, Inc. | 40,987 | |||||||||
2,615 | Pediatrix Medical Group, Inc.* | 177,872 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
4,240 | Pharmaceutical Product Development, Inc. | $ | 175,621 | ||||||||
1,671 | PharmaNet Development Group, Inc.* | 39,870 | |||||||||
8,347 | PSS World Medical, Inc.* | 137,475 | |||||||||
3,091 | Psychiatric Solutions, Inc.* | 107,289 | |||||||||
3,153 | RehabCare Group, Inc.* | 53,601 | |||||||||
4,157 | Res-Care, Inc.* | 67,718 | |||||||||
185,363 | Rotech Healthcare, Inc.* | 46,341 | |||||||||
13,539 | Rural/Metro Corp.* | 26,672 | |||||||||
4,839 | Salix Pharmaceuticals Ltd.* | 33,970 | |||||||||
2,422 | Sciele Pharma, Inc.* | 46,672 | |||||||||
1,128 | Sirona Dental Systems, Inc.* | 30,197 | |||||||||
6,749 | Skilled Healthcare Group, Inc., Class A* | 81,663 | |||||||||
6,458 | STERIS Corp. | 178,951 | |||||||||
5,196 | Sun Healthcare Group, Inc.* | 68,327 | |||||||||
5,506 | Sunrise Senior Living, Inc.* | 118,104 | |||||||||
2,276 | Symmetry Medical, Inc.* | 31,932 | |||||||||
1,304 | Techne Corp.* | 94,566 | |||||||||
3,736 | Thoratec Corp.* | 59,739 | |||||||||
4,767 | Triple-S Management Corp., Class B* | 86,950 | |||||||||
1,578 | TriZetto Group (The), Inc.* | 33,217 | |||||||||
5,789 | Universal American Financial Corp.* | 62,116 | |||||||||
12,487 | Valeant Pharmaceuticals International* | 165,827 | |||||||||
2,718 | Varian, Inc.* | 138,428 | |||||||||
4,366 | VCA Antech, Inc.* | 141,327 | |||||||||
5,524 | ViroPharma, Inc.* | 50,600 | |||||||||
408 | Vital Signs, Inc. | 21,351 | |||||||||
3,533 | Waters Corp.* | 217,137 | |||||||||
2,248 | WellCare Health Plans, Inc.* | 98,417 | |||||||||
2,722 | West Pharmaceutical Services, Inc. | 127,689 | |||||||||
1,270 | Wright Medical Group, Inc.* | 35,458 | |||||||||
1,813 | Zoll Medical Corp.* | 60,518 | |||||||||
9,520,212 | |||||||||||
Industrials—17.3% | |||||||||||
4,066 | A.O. Smith Corp. | 125,802 | |||||||||
3,432 | AAR Corp.* | 80,309 | |||||||||
7,750 | ABM Industries, Inc. | 162,285 | |||||||||
42,525 | ABX Air, Inc.* | 113,967 | |||||||||
12,279 | ACCO Brands Corp.* | 170,924 | |||||||||
12,377 | Accuride Corp.* | 98,645 | |||||||||
4,694 | Aceto Corp. | 32,999 | |||||||||
4,697 | Actuant Corp., Class A | 159,087 | |||||||||
3,229 | Administaff, Inc. | 84,568 | |||||||||
617 | Advisory Board (The) Co.* | 28,765 | |||||||||
651 | Aegean Marine Petroleum Network, Inc. (Greece) | 23,677 | |||||||||
4,653 | AerCap Holdings N.V. (Netherlands)* | 80,404 | |||||||||
3,207 | Aircastle Ltd. (Bermuda) | 44,834 | |||||||||
18,303 | AirTran Holdings, Inc.* | 62,413 | |||||||||
1,601 | Alamo Group, Inc. | 32,596 | |||||||||
4,039 | Albany International Corp., Class A | 146,616 |
See Notes to Financial Statements.
60
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
3,375 | Altra Holdings, Inc.* | $ | 51,401 | ||||||||
1,903 | American Commercial Lines, Inc.* | 30,105 | |||||||||
945 | American Railcar Industries, Inc. | 19,486 | |||||||||
3,875 | American Reprographics Co.* | 61,496 | |||||||||
3,021 | American Woodmark Corp. | 57,006 | |||||||||
712 | Ameron International Corp. | 70,346 | |||||||||
619 | Ampco-Pittsburgh Corp. | 27,991 | |||||||||
285 | Amrep Corp. | 14,863 | |||||||||
2,514 | Angelica Corp. | 40,626 | |||||||||
4,656 | Apogee Enterprises, Inc. | 103,875 | |||||||||
5,935 | Applied Industrial Technologies, Inc. | 143,390 | |||||||||
2,109 | Argon ST, Inc.* | 38,827 | |||||||||
2,783 | Aries Maritime Transport Ltd. (Bermuda) | 15,307 | |||||||||
6,810 | Arkansas Best Corp. | 268,858 | |||||||||
1,921 | Astec Industries, Inc.* | 70,405 | |||||||||
2,990 | Atlas Air Worldwide Holdings, Inc.* | 181,433 | |||||||||
3,819 | Baldor Electric Co. | 123,736 | |||||||||
4,949 | Barnes Group, Inc. | 129,070 | |||||||||
4,347 | BE Aerospace, Inc.* | 175,445 | |||||||||
14,109 | Beacon Roofing Supply, Inc.* | 150,261 | |||||||||
4,022 | Belden CDT, Inc. | 135,702 | |||||||||
5,846 | Blount International, Inc.* | 72,315 | |||||||||
5,972 | Bowne & Co., Inc. | 99,374 | |||||||||
6,144 | Brady Corp., Class A | 208,589 | |||||||||
649 | Bucyrus International Inc., Class A | 81,729 | |||||||||
11,178 | Builders FirstSource, Inc.* | 73,663 | |||||||||
6,555 | C&D Technologies, Inc.* | 36,184 | |||||||||
1,318 | Cascade Corp. | 57,004 | |||||||||
5,884 | Casella Waste Systems, Inc., Class A* | 62,723 | |||||||||
7,915 | CBIZ, Inc.* | 70,206 | |||||||||
4,084 | CDI Corp. | 111,085 | |||||||||
5,607 | Celadon Group, Inc.* | 57,696 | |||||||||
7,591 | Cenveo, Inc.* | 77,960 | |||||||||
2,689 | Ceradyne, Inc.* | 104,763 | |||||||||
2,019 | Chart Industries, Inc.* | 82,052 | |||||||||
9,879 | China Yuchai International Ltd. (Bermuda) | 92,665 | |||||||||
1,034 | CIRCOR International, Inc. | 49,808 | |||||||||
3,839 | CLARCOR, Inc. | 161,084 | |||||||||
988 | Clean Harbors, Inc.* | 65,178 | |||||||||
2,993 | Coleman Cable, Inc.* | 36,066 | |||||||||
2,624 | Columbus McKinnon Corp.* | 74,285 | |||||||||
5,584 | Comfort Systems USA, Inc. | 75,942 | |||||||||
8,583 | Commercial Vehicle Group, Inc.* | 103,425 | |||||||||
1,684 | Compx International, Inc. | 10,660 | |||||||||
2,100 | COMSYS IT Partners, Inc.* | 17,178 | |||||||||
1,839 | Consolidated Graphics, Inc.* | 106,975 | |||||||||
2,453 | Copa Holdings S.A., Class A (Panama) | 95,888 | |||||||||
3,188 | Copart, Inc.* | 130,294 | |||||||||
2,554 | Cornell Cos., Inc.* | 58,027 | |||||||||
2,126 | Corporate Executive Board Co. | 92,630 | |||||||||
884 | CoStar Group, Inc.* | 42,388 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
1,722 | Courier Corp. | $ | 40,536 | ||||||||
7,400 | Covenant Transport, Inc., Class A* | 42,402 | |||||||||
1,312 | CRA International, Inc.* | 45,238 | |||||||||
2,519 | Cubic Corp. | 68,290 | |||||||||
3,596 | Curtiss-Wright Corp. | 170,774 | |||||||||
1,486 | Danaos Corp. (Greece) | 37,016 | |||||||||
5,178 | Dayton Superior Corp.* | 12,375 | |||||||||
3,726 | Deswell Industries, Inc. (Hong Kong) | 24,033 | |||||||||
2,483 | Diana Shipping, Inc. (Greece) | 75,384 | |||||||||
5,086 | Donaldson Co., Inc. | 221,444 | |||||||||
840 | DryShips, Inc. (Greece) | 69,300 | |||||||||
1,529 | Ducommun, Inc.* | 49,815 | |||||||||
2,273 | Dun & Bradstreet (The) Corp. | 191,614 | |||||||||
1,492 | Dynamex, Inc.* | 37,494 | |||||||||
5,710 | DynCorp International, Inc., Class A* | 102,495 | |||||||||
2,497 | Eagle Bulk Shipping, Inc. | 73,487 | |||||||||
3,035 | Electro Rent Corp. | 41,003 | |||||||||
4,522 | Encore Wire Corp. | 102,197 | |||||||||
1,893 | Energy Conversion Devices, Inc.* | 61,693 | |||||||||
3,302 | EnergySolutions, Inc. | 72,149 | |||||||||
5,488 | EnerSys* | 128,419 | |||||||||
5,157 | Ennis, Inc. | 87,360 | |||||||||
4,314 | EnPro Industries, Inc.* | 156,598 | |||||||||
2,755 | ESCO Technologies, Inc.* | 128,273 | |||||||||
2,726 | Esterline Technologies Corp.* | 151,729 | |||||||||
2,143 | Excel Maritime Carriers Ltd. (Liberia) | 85,099 | |||||||||
76,351 | ExpressJet Holdings, Inc.* | 231,343 | |||||||||
12,025 | Federal Signal Corp. | 166,907 | |||||||||
4,982 | First Advantage Corp., Class A* | 102,181 | |||||||||
103 | First Solar, Inc.* | 30,075 | |||||||||
1,642 | Forward Air Corp. | 55,976 | |||||||||
1,792 | Franklin Electric Co., Inc. | 69,386 | |||||||||
1,505 | FreightCar America, Inc. | 57,792 | |||||||||
25,097 | Frontier Airlines Holdings, Inc.* | 10,415 | |||||||||
4,081 | Frozen Food Express Industries, Inc. | 31,097 | |||||||||
1,998 | FTI Consulting, Inc.* | 127,872 | |||||||||
2,765 | G&K Services, Inc., Class A | 87,180 | |||||||||
4,878 | Gardner Denver, Inc.* | 226,582 | |||||||||
3,346 | Gehl Co.* | 51,629 | |||||||||
1,130 | Genco Shipping & Trading Ltd. | 76,445 | |||||||||
2,711 | General Cable Corp.* | 181,637 | |||||||||
2,477 | Genesee & Wyoming, Inc., Class A* | 88,379 | |||||||||
3,020 | Geo Group (The), Inc.* | 79,879 | |||||||||
8,301 | Gibraltar Industries, Inc. | 86,745 | |||||||||
1,364 | Gorman-Rupp (The) Co. | 47,781 | |||||||||
5,881 | Graco, Inc. | 243,531 | |||||||||
5,204 | GrafTech International Ltd.* | 102,259 | |||||||||
4,187 | Great Lakes Dredge & Dock Corp. | 25,038 | |||||||||
3,336 | Greenbrier Cos., Inc. | 75,894 | |||||||||
14,699 | Griffon Corp.* | 137,436 | |||||||||
2,310 | H&E Equipment Services, Inc.* | 30,284 |
See Notes to Financial Statements.
61
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
6,563 | Hawaiian Holdings, Inc.* | $ | 52,176 | ||||||||
2,451 | Healthcare Services Group, Inc. | 37,402 | |||||||||
5,210 | Heartland Express, Inc. | 80,599 | |||||||||
322 | Heico Corp. | 16,586 | |||||||||
808 | Heico Corp., Class A | 32,506 | |||||||||
1,831 | Heidrick & Struggles International, Inc. | 54,802 | |||||||||
2,998 | Herley Industries, Inc.* | 36,546 | |||||||||
5,071 | Herman Miller, Inc. | 118,306 | |||||||||
7,032 | Hexcel Corp.* | 157,376 | |||||||||
3,205 | Horizon Lines, Inc., Class A | 33,813 | |||||||||
4,186 | Hub Group, Inc., Class A* | 136,840 | |||||||||
11,583 | Hudson Highland Group, Inc.* | 102,741 | |||||||||
18,920 | Huttig Building Products, Inc.* | 48,246 | |||||||||
4,185 | ICT Group, Inc.* | 45,742 | |||||||||
5,134 | IDEX Corp. | 188,366 | |||||||||
1,332 | IHS, Inc., Class A* | 87,979 | |||||||||
1,474 | II-VI, Inc.* | 54,744 | |||||||||
4,301 | Industrial Distribution Group, Inc.* | 51,354 | |||||||||
5,848 | Insituform Technologies, Inc., Class A* | 98,948 | |||||||||
3,076 | Insteel Industries, Inc. | 38,327 | |||||||||
4,384 | Integrated Electrical Services, Inc.* | 73,344 | |||||||||
5,236 | Interface, Inc., Class A | 67,230 | |||||||||
4,628 | Interline Brands, Inc.* | 89,552 | |||||||||
2,207 | International Shipholding Corp.* | 41,955 | |||||||||
1,811 | Kadant, Inc.* | 47,231 | |||||||||
3,872 | Kaman Corp. | 104,931 | |||||||||
2,199 | Kaydon Corp. | 115,162 | |||||||||
8,963 | Kforce, Inc.* | 73,765 | |||||||||
1,690 | KHD Humboldt Wedag International Ltd. (Canada)* | 48,993 | |||||||||
14,208 | Kimball International, Inc., Class B | 145,916 | |||||||||
3,638 | Kirby Corp.* | 199,508 | |||||||||
4,549 | Knight Transportation, Inc. | 77,288 | |||||||||
8,009 | Knoll, Inc. | 104,277 | |||||||||
5,265 | Korn/Ferry International* | 98,245 | |||||||||
1,088 | Ladish Co., Inc.* | 32,705 | |||||||||
3,280 | Landstar System, Inc. | 170,429 | |||||||||
1,587 | Lawson Products, Inc. | 40,278 | |||||||||
1,530 | Layne Christensen Co.* | 65,285 | |||||||||
4,730 | LECG Corp.* | 49,145 | |||||||||
3,545 | LSI Industries, Inc. | 38,853 | |||||||||
4,127 | Lydall, Inc.* | 48,080 | |||||||||
1,542 | M&F Worldwide Corp.* | 53,045 | |||||||||
3,065 | Mac-Gray Corp.* | 30,160 | |||||||||
5,363 | Manitowoc (The) Co., Inc. | 202,829 | |||||||||
3,488 | Marten Transport Ltd.* | 56,854 | |||||||||
3,527 | McGrath Rentcorp | 91,102 | |||||||||
44,641 | Mesa Air Group, Inc.* | 29,463 | |||||||||
1,664 | Michael Baker Corp.* | 35,044 | |||||||||
551 | Middleby (The) Corp.* | 34,575 | |||||||||
2,930 | Miller Industries, Inc.* | 33,050 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
2,801 | Mine Safety Appliances Co. | $ | 104,113 | ||||||||
4,112 | Mobile Mini, Inc.* | 87,380 | |||||||||
7,653 | Monster Worldwide, Inc.* | 186,197 | |||||||||
5,143 | Moog, Inc., Class A* | 221,715 | |||||||||
1,408 | MTC Technologies, Inc.* | 33,595 | |||||||||
6,264 | Navigant Consulting, Inc.* | 126,032 | |||||||||
6,524 | Navios Maritime Holdings, Inc. (Greece) | 71,699 | |||||||||
5,070 | NCI Building Systems, Inc.* | 122,390 | |||||||||
3,185 | NN, Inc. | 31,977 | |||||||||
2,115 | Nordson Corp. | 124,848 | |||||||||
1,189 | Northwest Pipe Co.* | 50,556 | |||||||||
5,076 | Old Dominion Freight Line, Inc.* | 155,833 | |||||||||
4,551 | Orbital Sciences Corp.* | 122,467 | |||||||||
1,124 | P.A.M. Transportation Services, Inc.* | 16,006 | |||||||||
7,045 | Pacer International, Inc. | 130,755 | |||||||||
3,078 | Park-Ohio Holdings Corp.* | 51,341 | |||||||||
1,970 | Perini Corp.* | 71,275 | |||||||||
6,003 | PGT, Inc.* | 19,150 | |||||||||
3,049 | Pike Electric Corp.* | 48,906 | |||||||||
6,192 | Pinnacle Airlines Corp.* | 51,517 | |||||||||
1,730 | Polypore International, Inc.* | 40,499 | |||||||||
859 | Powell Industries, Inc.* | 36,138 | |||||||||
1,769 | Protection One, Inc.* | 18,221 | |||||||||
10,028 | Quality Distribution, Inc. | 34,095 | |||||||||
3,978 | Quanex Building Products Corp.* | 67,626 | |||||||||
9,076 | Quanta Services, Inc.* | 240,876 | |||||||||
1,241 | Raven Industries, Inc. | 38,024 | |||||||||
1,396 | RBC Bearings, Inc.* | 55,798 | |||||||||
4,309 | Regal-Beloit Corp. | 159,821 | |||||||||
5,682 | Republic Airways Holdings, Inc.* | 95,799 | |||||||||
5,253 | Resources Connection, Inc. | 106,163 | |||||||||
3,482 | Robbins & Myers, Inc. | 138,793 | |||||||||
2,744 | Rollins, Inc. | 43,712 | |||||||||
14,554 | RSC Holdings, Inc.* | 134,479 | |||||||||
4,720 | Rush Enterprises, Inc., Class A* | 76,086 | |||||||||
2,296 | Rush Enterprises, Inc., Class B* | 34,509 | |||||||||
6,475 | Saia, Inc.* | 89,420 | |||||||||
1,855 | Schawk, Inc. | 29,736 | |||||||||
4,527 | School Specialty, Inc.* | 133,275 | |||||||||
3,203 | Seaspan Corp. (Hong Kong) | 85,136 | |||||||||
4,108 | Simpson Manufacturing Co., Inc. | 108,410 | |||||||||
27,302 | Spherion Corp.* | 134,872 | |||||||||
866 | Standard Parking Corp.* | 18,558 | |||||||||
10,174 | Standard Register (The) Co. | 96,450 | |||||||||
3,869 | Standex International Corp. | 81,559 | |||||||||
720 | Stanley, Inc.* | 18,166 | |||||||||
2,893 | Stericycle, Inc.* | 154,428 | |||||||||
591 | Sunpower Corp., Class A* | 51,577 | |||||||||
5,946 | Superior Essex, Inc.* | 176,775 | |||||||||
3,554 | Sypris Solutions, Inc. | 14,891 | |||||||||
2,788 | TAL International Group, Inc. | 67,497 |
See Notes to Financial Statements.
62
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
1,201 | TBS International Ltd. , Class A (Bermuda)* | $ | 48,256 | ||||||||
6,758 | Tecumseh Products Co., Class A* | 211,728 | |||||||||
1,567 | Tecumseh Products Co., Class B* | 43,077 | |||||||||
3,171 | Teledyne Technologies, Inc.* | 186,233 | |||||||||
4,526 | TeleTech Holdings, Inc.* | 103,781 | |||||||||
1,834 | Tennant Co. | 62,594 | |||||||||
7,964 | Tetra Tech, Inc.* | 168,279 | |||||||||
2,026 | Textainer Group Holdings Ltd. | 34,645 | |||||||||
5,085 | Thermadyne Holdings Corp.* | 65,342 | |||||||||
1,418 | Titan International, Inc. | 50,523 | |||||||||
3,460 | Toro (The) Co. | 146,669 | |||||||||
1,740 | TransDigm Group, Inc.* | 66,068 | |||||||||
5,372 | TRC Cos., Inc.* | 32,501 | |||||||||
6,873 | Tredegar Corp. | 112,305 | |||||||||
2,779 | Trex Co., Inc.* | 25,289 | |||||||||
8,594 | Trimas Corp.* | 53,025 | |||||||||
1,805 | Triumph Group, Inc. | 106,260 | |||||||||
9,458 | TrueBlue, Inc.* | 120,400 | |||||||||
5,028 | UAP Holding Corp. | 195,639 | |||||||||
2,117 | Ultrapetrol Bahamas Ltd.* | 20,344 | |||||||||
4,811 | Universal Forest Products, Inc. | 166,990 | |||||||||
2,497 | Universal Truckload Services, Inc.* | 52,362 | |||||||||
3,103 | USA Truck, Inc.* | 37,857 | |||||||||
11,072 | UTi Worldwide, Inc. (British Virgin Islands) | 243,362 | |||||||||
1,143 | Valmont Industries, Inc. | 112,540 | |||||||||
4,237 | Viad Corp. | 133,296 | |||||||||
8,123 | Volt Information Sciences, Inc.* | 108,361 | |||||||||
10,831 | Wabash National Corp. | 90,764 | |||||||||
3,004 | Wabtec Corp. | 128,812 | |||||||||
2,085 | Walter Industries, Inc. | 144,616 | |||||||||
5,993 | Waste Connections, Inc.* | 192,196 | |||||||||
462 | Waste Industries USA, Inc. | 17,441 | |||||||||
5,596 | Waste Services, Inc.* | 43,705 | |||||||||
3,996 | Watsco, Inc. | 181,299 | |||||||||
2,887 | Watson Wyatt Worldwide, Inc., Class A | 169,236 | |||||||||
5,161 | Watts Water Technologies, Inc., Class A | 138,676 | |||||||||
7,621 | Westaff, Inc.* | 15,242 | |||||||||
1,947 | Willis Lease Finance Corp.* | 24,084 | |||||||||
4,488 | Woodward Governor Co. | 157,663 | |||||||||
7,780 | Xerium Technologies, Inc. | 13,148 | |||||||||
22,670,758 | |||||||||||
Information Technology—15.4% | |||||||||||
44,849 | 3Com Corp.* | 107,189 | |||||||||
3,735 | ACI Worldwide, Inc.* | 82,544 | |||||||||
3,319 | Actel Corp.* | 54,697 | |||||||||
14,759 | Acxiom Corp. | 174,599 | |||||||||
24,826 | Adaptec, Inc.* | 69,265 | |||||||||
11,387 | ADC Telecommunications, Inc.* | 159,646 | |||||||||
7,915 | ADTRAN, Inc. | 187,269 | |||||||||
3,902 | Advanced Energy Industries, Inc.* | 54,628 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
8,200 | Agilysys, Inc. | $ | 89,872 | ||||||||
3,623 | Akamai Technologies, Inc.* | 129,595 | |||||||||
2,118 | Ansys, Inc.* | 85,207 | |||||||||
7,904 | Applied Micro Circuits Corp.* | 69,239 | |||||||||
6,093 | Ariba, Inc.* | 72,324 | |||||||||
19,834 | Arris Group, Inc.* | 160,655 | |||||||||
6,683 | ASE Test Ltd. (Taiwan, Republic of China)* | 97,973 | |||||||||
10,382 | Asyst Technologies, Inc.* | 37,168 | |||||||||
1,140 | Atheros Communications, Inc.* | 30,347 | |||||||||
2,542 | ATMI, Inc.* | 74,836 | |||||||||
5,628 | Avid Technology, Inc.* | 117,456 | |||||||||
7,033 | Avocent Corp.* | 137,214 | |||||||||
12,519 | Axcelis Technologies, Inc.* | 67,603 | |||||||||
80,887 | BearingPoint, Inc.* | 149,641 | |||||||||
1,303 | Bel Fuse, Inc., Class B | 33,969 | |||||||||
3,367 | Black Box Corp. | 100,101 | |||||||||
27,144 | Borland Software Corp.* | 48,045 | |||||||||
10,811 | Brightpoint, Inc.* | 99,029 | |||||||||
16,687 | Brocade Communications Systems, Inc.* | 119,479 | |||||||||
12,751 | Brooks Automation, Inc.* | 132,100 | |||||||||
2,441 | Cabot Microelectronics Corp.* | 83,116 | |||||||||
10,874 | CDC Corp., Class A (Hong Kong)* | 37,515 | |||||||||
4,765 | Checkpoint Systems, Inc.* | 123,556 | |||||||||
29,016 | ChipMOS TECHNOLOGIES Bermuda Ltd. (Taiwan, Republic of China)* | 85,887 | |||||||||
23,562 | Ciber, Inc.* | 147,498 | |||||||||
7,778 | Cirrus Logic, Inc.* | 55,613 | |||||||||
9,410 | CMGI, Inc.* | 130,140 | |||||||||
6,893 | CNET Networks, Inc.* | 53,421 | |||||||||
2,063 | Cogent, Inc.* | 19,248 | |||||||||
3,630 | Cognex Corp. | 91,476 | |||||||||
6,594 | Cognizant Technology Solutions Corp., Class A* | 212,657 | |||||||||
2,577 | Cohu, Inc. | 44,762 | |||||||||
4,193 | CommScope, Inc.* | 199,377 | |||||||||
1,667 | Comtech Telecommunications Corp.* | 64,563 | |||||||||
1,261 | Concur Technologies, Inc.* | 41,790 | |||||||||
111,123 | Conexant Systems, Inc.* | 55,006 | |||||||||
2,273 | CPI International, Inc.* | 26,026 | |||||||||
5,461 | Cree, Inc.* | 141,986 | |||||||||
8,188 | CSG Systems International, Inc.* | 99,075 | |||||||||
7,139 | CTS Corp. | 80,314 | |||||||||
3,777 | Cymer, Inc.* | 98,164 | |||||||||
9,839 | Cypress Semiconductor Corp.* | 276,672 | |||||||||
1,978 | Daktronics, Inc. | 29,255 | |||||||||
1,580 | DealerTrack Holdings, Inc.* | 30,399 | |||||||||
3,567 | Digi International, Inc.* | 29,392 | |||||||||
2,671 | Digital River, Inc.* | 87,742 | |||||||||
1,859 | Diodes, Inc.* | 50,267 | |||||||||
3,159 | Dolby Laboratories, Inc., Class A* | 126,834 | |||||||||
4,542 | DSP Group, Inc.* | 59,636 |
See Notes to Financial Statements.
63
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
12,055 | Dycom Industries, Inc.* | $ | 173,351 | ||||||||
23,545 | EarthLink, Inc.* | 214,965 | |||||||||
3,256 | Electro Scientific Industries, Inc.* | 53,431 | |||||||||
7,660 | Electronics for Imaging, Inc.* | 110,457 | |||||||||
1,482 | EMS Technologies, Inc.* | 38,325 | |||||||||
8,151 | Emulex Corp.* | 106,697 | |||||||||
19,440 | Entegris, Inc.* | 146,578 | |||||||||
4,218 | Epicor Software Corp.* | 33,744 | |||||||||
3,336 | EPIQ Systems, Inc.* | 51,508 | |||||||||
826 | Equinix, Inc.* | 74,687 | |||||||||
3,024 | Euronet Worldwide, Inc.* | 53,464 | |||||||||
5,228 | Exar Corp.* | 44,072 | |||||||||
15,085 | Extreme Networks, Inc.* | 45,708 | |||||||||
5,317 | F5 Networks, Inc.* | 120,324 | |||||||||
1,326 | Factset Research Systems, Inc. | 79,600 | |||||||||
5,538 | Fair Isaac Corp. | 137,176 | |||||||||
3,306 | FEI Co.* | 72,302 | |||||||||
3,667 | FLIR Systems, Inc.* | 125,888 | |||||||||
5,128 | FormFactor, Inc.* | 98,817 | |||||||||
1,152 | Forrester Research, Inc.* | 33,224 | |||||||||
11,827 | Foundry Networks, Inc.* | 150,558 | |||||||||
2,761 | Gartner, Inc.* | 63,282 | |||||||||
2,363 | Genpact Ltd.* | 33,791 | |||||||||
6,410 | Gerber Scientific, Inc.* | 59,421 | |||||||||
8,489 | Gevity HR, Inc. | 57,895 | |||||||||
10,288 | Global Cash Access Holdings, Inc.* | 63,580 | |||||||||
4,291 | Global Payments, Inc. | 189,920 | |||||||||
5,904 | GTSI Corp.* | 47,232 | |||||||||
1,120 | Heartland Payment Systems, Inc. | 24,528 | |||||||||
465 | Hittite Microwave Corp.* | 18,461 | |||||||||
539 | Hughes Communications, Inc.* | 29,106 | |||||||||
6,140 | Hutchinson Technology, Inc.* | 86,820 | |||||||||
9,307 | Hypercom Corp.* | 39,741 | |||||||||
2,750 | i2 Technologies, Inc.* | 28,875 | |||||||||
7,698 | Imation Corp. | 180,441 | |||||||||
2,664 | Informatica Corp.* | 42,517 | |||||||||
9,005 | InfoSpace, Inc. | 108,600 | |||||||||
6,517 | infoUSA, Inc. | 36,951 | |||||||||
4,027 | InterDigital, Inc.* | 81,627 | |||||||||
4,271 | Intermec, Inc.* | 90,204 | |||||||||
2,813 | Interwoven, Inc.* | 31,674 | |||||||||
50,404 | Iomega Corp.* | 193,047 | |||||||||
13,602 | Ipass, Inc.* | 38,766 | |||||||||
939 | Itron, Inc.* | 87,402 | |||||||||
2,517 | Ixia* | 17,846 | |||||||||
3,389 | IXYS Corp.* | 24,299 | |||||||||
1,673 | j2 Global Communications, Inc.* | 35,802 | |||||||||
5,870 | Jack Henry & Associates, Inc. | 154,264 | |||||||||
2,966 | JDA Software Group, Inc.* | 56,057 | |||||||||
14,635 | JDS Uniphase Corp.* | 209,427 | |||||||||
4,799 | Jupitermedia Corp.* | 9,358 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
20,831 | KEMET Corp.* | $ | 84,782 | ||||||||
13,114 | Kulicke & Soffa Industries, Inc.* | 86,421 | |||||||||
9,221 | L-1 Identity Solutions, Inc.* | 132,875 | |||||||||
24,551 | Lattice Semiconductor Corp.* | 83,228 | |||||||||
10,291 | Lawson Software, Inc.* | 82,225 | |||||||||
2,382 | Littelfuse, Inc.* | 87,562 | |||||||||
4,005 | Loral Space & Communications, Inc.* | 86,468 | |||||||||
4,932 | Macrovision Corp.* | 77,827 | |||||||||
1,766 | Manhattan Associates, Inc.* | 45,934 | |||||||||
2,752 | ManTech International Corp., Class A* | 131,463 | |||||||||
4,313 | Marchex, Inc., Class B | 44,553 | |||||||||
7,579 | MasTec, Inc.* | 62,072 | |||||||||
5,788 | Mattson Technology, Inc.* | 28,072 | |||||||||
2,010 | MAXIMUS, Inc. | 76,219 | |||||||||
13,427 | Mentor Graphics Corp.* | 135,210 | |||||||||
5,641 | Mercury Computer Systems, Inc.* | 45,241 | |||||||||
11,607 | Merix Corp.* | 22,111 | |||||||||
6,565 | Methode Electronics, Inc. | 71,165 | |||||||||
5,197 | Micrel, Inc. | 51,035 | |||||||||
3,710 | MICROS Systems, Inc.* | 132,262 | |||||||||
4,299 | Microsemi Corp.* | 105,326 | |||||||||
770 | MicroStrategy, Inc., Class A* | 68,322 | |||||||||
5,101 | MKS Instruments, Inc.* | 116,558 | |||||||||
39,531 | MoneyGram International, Inc. | 61,273 | |||||||||
16,749 | MPS Group, Inc.* | 179,717 | |||||||||
4,544 | MSC.Software Corp.* | 55,346 | |||||||||
1,797 | MTS Systems Corp. | 61,781 | |||||||||
1,205 | Multi-Fineline Electronix, Inc.* | 22,775 | |||||||||
11,160 | Nam Tai Electronics, Inc. (Hong Kong) | 115,060 | |||||||||
3,243 | National Instruments Corp. | 95,409 | |||||||||
1,660 | NAVTEQ Corp.* | 123,189 | |||||||||
4,784 | Ness Technologies, Inc.* | 43,391 | |||||||||
1,622 | Net 1 UEPS Technologies, Inc.* | 38,020 | |||||||||
2,216 | NETGEAR, Inc.* | 35,921 | |||||||||
2,235 | NeuStar, Inc., Class A* | 61,485 | |||||||||
5,865 | Newport Corp.* | 67,506 | |||||||||
26,709 | Novell, Inc.* | 167,733 | |||||||||
7,736 | NU Horizons Electronics Corp.* | 44,173 | |||||||||
5,617 | Nuance Communications, Inc.* | 113,913 | |||||||||
6,057 | Omnivision Technologies, Inc.* | 97,154 | |||||||||
34,637 | ON Semiconductor Corp.* | 258,737 | |||||||||
16,859 | Openwave Systems, Inc. | 36,078 | |||||||||
2,038 | Opnext, Inc.* | 12,024 | |||||||||
4,003 | Orbotech Ltd. (Israel)* | 70,253 | |||||||||
2,378 | OSI Systems, Inc.* | 58,142 | |||||||||
31,918 | Palm, Inc. | 183,848 | |||||||||
8,962 | Parametric Technology Corp.* | 156,208 | |||||||||
3,011 | Park Electrochemical Corp. | 81,598 | |||||||||
3,157 | PC Connection, Inc.* | 23,583 | |||||||||
12,812 | Photronics, Inc.* | 135,807 | |||||||||
7,669 | Planar Systems, Inc.* | 17,485 |
See Notes to Financial Statements.
64
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
5,408 | Plantronics, Inc. | $ | 134,713 | ||||||||
6,097 | Plexus Corp.* | 146,877 | |||||||||
17,831 | PMC - Sierra, Inc.* | 138,547 | |||||||||
7,173 | Polycom, Inc.* | 160,675 | |||||||||
35,724 | Powerwave Technologies, Inc.* | 97,527 | |||||||||
2,982 | Progress Software Corp.* | 90,146 | |||||||||
11,852 | QLogic Corp.* | 189,158 | |||||||||
849 | Quality Systems, Inc. | 27,270 | |||||||||
38,494 | Quantum Corp.* | 67,365 | |||||||||
4,057 | Quest Software, Inc.* | 54,039 | |||||||||
5,477 | Rackable Systems, Inc.* | 60,247 | |||||||||
4,501 | Radisys Corp.* | 42,444 | |||||||||
3,080 | Rambus, Inc.* | 70,717 | |||||||||
13,039 | RealNetworks, Inc.* | 80,320 | |||||||||
4,442 | Red Hat, Inc.* | 91,372 | |||||||||
1,686 | Renaissance Learning, Inc. | 23,705 | |||||||||
46,841 | RF Micro Devices, Inc.* | 157,854 | |||||||||
8,671 | Richardson Electronics Ltd. | 56,362 | |||||||||
2,146 | Rofin-Sinar Technologies, Inc.* | 81,720 | |||||||||
1,674 | Rogers Corp.* | 57,318 | |||||||||
4,250 | Rudolph Technologies, Inc.* | 43,180 | |||||||||
24,063 | Safeguard Scientifics, Inc.* | 38,501 | |||||||||
592 | Salesforce.com, Inc.* | 39,504 | |||||||||
3,976 | Sapient Corp.* | 28,309 | |||||||||
4,167 | ScanSource, Inc.* | 104,050 | |||||||||
5,859 | Secure Computing Corp.* | 38,787 | |||||||||
6,327 | Semtech Corp.* | 102,750 | |||||||||
1,492 | SI International, Inc.* | 34,226 | |||||||||
8,064 | Sigmatel, Inc.* | 24,152 | |||||||||
10,032 | Silicon Image, Inc.* | 59,891 | |||||||||
2,451 | Silicon Laboratories, Inc.* | 82,770 | |||||||||
19,463 | Silicon Storage Technology, Inc.* | 59,751 | |||||||||
1,491 | SINA Corp. (China)* | 68,884 | |||||||||
6,955 | Sirf Technology Holdings, Inc.* | 41,104 | |||||||||
17,618 | Skyworks Solutions, Inc.* | 153,100 | |||||||||
9,645 | Smart Modular Technologies (WWH), Inc.* | 58,159 | |||||||||
1,769 | Solera Holdings, Inc.* | 45,658 | |||||||||
4,405 | SonicWALL, Inc.* | 33,874 | |||||||||
16,395 | Sonus Networks, Inc.* | 65,744 | |||||||||
827 | SPSS, Inc.* | 34,932 | |||||||||
4,493 | SRA International, Inc., Class A* | 118,031 | |||||||||
2,172 | Standard Microsystems Corp.* | 64,400 | |||||||||
4,972 | Startek, Inc.* | 46,886 | |||||||||
2,297 | STEC, Inc.* | 21,086 | |||||||||
1,218 | Super Micro Computer, Inc.* | 9,086 | |||||||||
7,576 | Sybase, Inc.* | 222,885 | |||||||||
18,003 | Sycamore Networks, Inc.* | 57,970 | |||||||||
3,314 | Sykes Enterprises, Inc.* | 55,079 | |||||||||
11,160 | Symmetricom, Inc.* | 47,876 | |||||||||
5,242 | Symyx Technologies, Inc.* | 39,367 | |||||||||
1,527 | Synaptics, Inc.* | 51,826 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
1,002 | Syntel, Inc. | $ | 33,176 | ||||||||
5,849 | Take-Two Interactive Software, Inc.* | 153,478 | |||||||||
4,021 | Technitrol, Inc. | 84,441 | |||||||||
5,674 | Tekelec* | 83,521 | |||||||||
7,781 | Teradata Corp.* | 165,657 | |||||||||
1,544 | Tessco Technologies, Inc.* | 20,767 | |||||||||
2,105 | Tessera Technologies, Inc.* | 42,605 | |||||||||
9,930 | THQ, Inc.* | 211,310 | |||||||||
19,247 | TIBCO Software, Inc.* | 147,624 | |||||||||
3,053 | TNS, Inc.* | 70,219 | |||||||||
5,464 | Trimble Navigation Ltd.* | 179,165 | |||||||||
15,593 | Triquint Semiconductor, Inc.* | 102,758 | |||||||||
4,913 | TTM Technologies, Inc.* | 65,392 | |||||||||
7,564 | United Online, Inc. | 80,784 | |||||||||
4,841 | ValueClick, Inc.* | 96,578 | |||||||||
4,037 | Varian Semiconductor Equipment Associates, Inc.* | 147,875 | |||||||||
2,823 | Veeco Instruments, Inc.* | 53,157 | |||||||||
5,013 | Verigy Ltd. (Singapore)* | 107,128 | |||||||||
3,240 | Viasat, Inc.* | 71,604 | |||||||||
3,146 | Vignette Corp.* | 36,336 | |||||||||
142 | Vmware, Inc., Class A* | 9,463 | |||||||||
2,288 | WebMD Health Corp., Class A* | 71,729 | |||||||||
1,933 | Websense, Inc.* | 37,597 | |||||||||
23,554 | Westell Technologies, Inc., Class A* | 39,571 | |||||||||
6,509 | Wind River Systems, Inc.* | 53,634 | |||||||||
5,879 | Wright Express Corp.* | 194,007 | |||||||||
1,120 | Xyratex Ltd. (Bermuda)* | 22,030 | |||||||||
5,323 | Zebra Technologies Corp., Class A* | 195,620 | |||||||||
1,964 | Zones, Inc.* | 16,890 | |||||||||
6,404 | Zoran Corp.* | 84,277 | |||||||||
20,102,014 | |||||||||||
Materials—5.1% | |||||||||||
1,725 | AEP Industries, Inc.* | 48,697 | |||||||||
2,186 | AM Castle & Co. | 67,569 | |||||||||
1,930 | AMCOL International Corp. | 57,321 | |||||||||
3,993 | Arch Chemicals, Inc. | 136,042 | |||||||||
2,615 | Brush Engineered Materials, Inc.* | 81,091 | |||||||||
7,960 | Buckeye Technologies, Inc.* | 68,695 | |||||||||
5,135 | Bway Holding Co.* | 45,702 | |||||||||
2,264 | Calgon Carbon Corp.* | 32,262 | |||||||||
31,173 | Caraustar Industries, Inc.* | 43,330 | |||||||||
1,228 | Century Aluminum Co.* | 85,088 | |||||||||
1,434 | CF Industries Holdings, Inc. | 191,726 | |||||||||
33,900 | Chesapeake Corp. | 148,482 | |||||||||
1,519 | Cleveland-Cliffs, Inc. | 243,647 | |||||||||
15,202 | Coeur d'Alene Mines Corp.* | 46,670 | |||||||||
1,413 | Compass Minerals International, Inc. | 89,019 | |||||||||
24,161 | Constar International, Inc.* | 70,792 | |||||||||
764 | Deltic Timber Corp. | 40,301 |
See Notes to Financial Statements.
65
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
5,084 | Eagle Materials, Inc. | $ | 184,448 | ||||||||
12,660 | Esmark, Inc.* | 211,295 | |||||||||
12,874 | Ferro Corp. | 226,324 | |||||||||
7,927 | GenTek, Inc.* | 246,212 | |||||||||
31,667 | Georgia Gulf Corp. | 190,319 | |||||||||
9,004 | Glatfelter | 131,368 | |||||||||
7,447 | H.B. Fuller Co. | 171,877 | |||||||||
1,455 | Haynes International, Inc.* | 91,156 | |||||||||
16,713 | Headwaters, Inc.* | 191,030 | |||||||||
3,504 | Hecla Mining Co.* | 35,951 | |||||||||
3,294 | Horsehead Holding Corp.* | 46,182 | |||||||||
4,478 | ICO, Inc.* | 33,272 | |||||||||
2,669 | Innophos Holdings, Inc. | 47,802 | |||||||||
3,967 | Innospec, Inc. | 80,887 | |||||||||
969 | Kaiser Aluminum Corp. | 66,502 | |||||||||
1,668 | Koppers Holdings, Inc. | 80,798 | |||||||||
4,877 | Material Sciences Corp.* | 38,723 | |||||||||
9,651 | Mercer International, Inc.* | 64,758 | |||||||||
2,375 | Minerals Technologies, Inc. | 160,883 | |||||||||
5,401 | Myers Industries, Inc. | 67,945 | |||||||||
2,387 | Neenah Paper, Inc. | 54,853 | |||||||||
1,268 | NewMarket Corp. | 82,331 | |||||||||
3,357 | NL Industries, Inc. | 37,196 | |||||||||
1,574 | Olympic Steel, Inc. | 80,589 | |||||||||
2,006 | OM Group, Inc.* | 109,849 | |||||||||
15,593 | Omnova Solutions, Inc.* | 53,172 | |||||||||
1,580 | Penford Corp. | 34,697 | |||||||||
27,323 | PolyOne Corp.* | 201,644 | |||||||||
1,947 | Quaker Chemical Corp. | 60,357 | |||||||||
5,364 | Rock-Tenn Co., Class A | 182,001 | |||||||||
1,269 | Royal Gold, Inc. | 35,900 | |||||||||
1,441 | RTI International Metals, Inc.* | 59,355 | |||||||||
2,542 | Schnitzer Steel Industries, Inc. | 223,695 | |||||||||
7,041 | Schulman (A.), Inc. | 149,269 | |||||||||
3,847 | Schweitzer-Mauduit International, Inc. | 85,134 | |||||||||
7,451 | Sensient Technologies Corp. | 221,816 | |||||||||
9,509 | Spartech Corp. | 85,010 | |||||||||
1,174 | Stepan Co. | 46,185 | |||||||||
2,526 | Stillwater Mining Co.* | 35,819 | |||||||||
3,295 | Terra Industries, Inc.* | 124,749 | |||||||||
2,708 | Texas Industries, Inc. | 209,626 | |||||||||
7,745 | Titanium Metals Corp. | 118,034 | |||||||||
13,828 | Tronox, Inc., Class A | 44,250 | |||||||||
16,175 | Tronox, Inc., Class B | 48,363 | |||||||||
19,690 | U.S. Concrete, Inc.* | 64,977 | |||||||||
8,675 | W.R. Grace & Co.* | 219,998 | |||||||||
16,008 | Wausau Paper Corp. | 123,902 | |||||||||
1,639 | Zoltek Cos., Inc.* | 43,712 | |||||||||
6,700,649 |
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
Telecommunication Services—1.6% | |||||||||||
6,359 | Alaska Communications Systems Group, Inc. | $ | 71,094 | ||||||||
5,484 | Arbinet-thexchange, Inc. | 18,865 | |||||||||
1,035 | Atlantic Tele-Network, Inc. | 32,220 | |||||||||
5,752 | Centennial Communications Corp.* | 34,857 | |||||||||
50,514 | Cincinnati Bell, Inc.* | 234,384 | |||||||||
1,057 | Clearwire Corp., Class A* | 16,003 | |||||||||
3,315 | Consolidated Communications Holdings, Inc. | 47,405 | |||||||||
4,610 | D&E Communications, Inc. | 41,490 | |||||||||
9,980 | Fairpoint Communications, Inc. | 91,916 | |||||||||
35,724 | FiberTower Corp.* | 54,300 | |||||||||
12,717 | General Communication, Inc., Class A* | 78,973 | |||||||||
1,365 | Global Crossing Ltd.* | 22,823 | |||||||||
1,594 | Globalstar, Inc.* | 5,165 | |||||||||
3,784 | IDT Corp. | 12,487 | |||||||||
21,878 | IDT Corp., Class B | 83,793 | |||||||||
4,831 | Iowa Telecommunications Services, Inc. | 83,673 | |||||||||
2,732 | iPCS, Inc. | 83,107 | |||||||||
21,054 | Kratos Defense & Security Solutions, Inc.* | 35,371 | |||||||||
8,520 | MetroPCS Communications, Inc.* | 167,332 | |||||||||
872 | Millicom International Cellular S.A. (Luxembourg)* | 94,185 | |||||||||
2,874 | NTELOS Holdings Corp. | 74,379 | |||||||||
6,405 | Premiere Global Services, Inc.* | 93,001 | |||||||||
977 | Rural Cellular Corp., Class A* | 43,418 | |||||||||
2,806 | SBA Communications Corp., Class A* | 90,746 | |||||||||
5,695 | SureWest Communications | 79,217 | |||||||||
4,707 | Syniverse Holdings, Inc.* | 73,947 | |||||||||
11,436 | Time Warner Telecom, Inc., Class A* | 224,145 | |||||||||
13,891 | USA Mobility, Inc. | 99,182 | |||||||||
6,939 | Virgin Mobile USA, Inc., Class A* | 28,797 | |||||||||
2,116,275 | |||||||||||
Utilities—2.0% | |||||||||||
2,390 | American States Water Co. | 83,698 | |||||||||
62,572 | Aquila, Inc.* | 225,258 | |||||||||
2,645 | California Water Service Group | 102,362 | |||||||||
2,426 | Central Vermont Public Service Corp. | 56,526 | |||||||||
4,815 | CH Energy Group, Inc. | 170,258 | |||||||||
1,313 | Chesapeake Utilities Corp. | 39,049 | |||||||||
8,492 | El Paso Electric Co.* | 191,664 | |||||||||
6,842 | Empire District Electric (The) Co. | 142,519 | |||||||||
767 | EnergySouth, Inc. | 41,456 | |||||||||
1,667 | ITC Holdings Corp. | 92,985 | |||||||||
5,667 | Laclede Group (The), Inc. | 214,325 | |||||||||
3,869 | MGE Energy, Inc. | 134,603 | |||||||||
1,765 | Middlesex Water Co. | 32,441 | |||||||||
4,637 | Northwest Natural Gas Co. | 208,062 | |||||||||
7,761 | NorthWestern Corp. | 192,628 | |||||||||
577 | Ormat Technologies, Inc. | 28,446 | |||||||||
5,184 | Otter Tail Corp. | 192,223 |
See Notes to Financial Statements.
66
Schedule of Investments (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks and Other Equity Interests (Continued) | |||||||||||
1,430 | SJW Corp. | $ | 43,000 | ||||||||
4,178 | South Jersey Industries, Inc. | 152,539 | |||||||||
3,055 | Southwest Water Co. | 34,033 | |||||||||
6,745 | UIL Holdings Corp. | 211,119 | |||||||||
1,537 | Unitil Corp. | 41,192 | |||||||||
2,630,386 | |||||||||||
Total Common Stocks and Other Equity Interests (Cost $143,111,493) | 130,063,821 | ||||||||||
Rights—0.0% | |||||||||||
Financials—0.0% | |||||||||||
487 | Winthrop Realty Trust, expiring 05/13/08* | 39 | |||||||||
Money Market Fund—0.4% | |||||||||||
468,491 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $468,491) | 468,491 | |||||||||
Total Investments (Cost $143,579,984)—99.7% | 130,532,351 | ||||||||||
Other assets less liabilities—0.3% | 411,526 | ||||||||||
Net Assets—100.0% | $ | 130,943,877 |
REIT Real Estate Investment Trust
* Non-income producing security.
+ Security fair valued in good faith in accordance with the procedures established by the Board of Trustees. The value of this security at April 30, 2008 represented 0.04% of the Fund's Net Assets. See Note 2A.
See Notes to Financial Statements.
67
Schedule of Investments
PowerShares FTSE RAFI Utilities Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—98.7% | |||||||||||
Electric - Generation—2.2% | |||||||||||
13,974 | AES (The) Corp.* | $ | 242,589 | ||||||||
Electric - Integrated—78.0% | |||||||||||
1,121 | Allegheny Energy, Inc. | 60,310 | |||||||||
811 | ALLETE, Inc. | 33,875 | |||||||||
2,612 | Alliant Energy Corp. | 98,394 | |||||||||
5,697 | Ameren Corp. | 258,416 | |||||||||
9,842 | American Electric Power Co., Inc. | 439,248 | |||||||||
1,521 | Avista Corp. | 31,226 | |||||||||
778 | Black Hills Corp. | 30,350 | |||||||||
10,124 | CenterPoint Energy, Inc. | 154,087 | |||||||||
1,227 | Cleco Corp. | 29,460 | |||||||||
6,570 | CMS Energy Corp. | 95,791 | |||||||||
7,497 | Consolidated Edison, Inc. | 311,875 | |||||||||
2,296 | Constellation Energy Group, Inc. | 194,356 | |||||||||
12,945 | Dominion Resources, Inc. | 561,683 | |||||||||
1,579 | DPL, Inc. | 43,944 | |||||||||
5,330 | DTE Energy Co. | 214,852 | |||||||||
41,053 | Duke Energy Corp. | 751,680 | |||||||||
5,546 | Edison International | 289,335 | |||||||||
4,384 | Energy East Corp. | 99,955 | |||||||||
2,816 | Entergy Corp. | 323,446 | |||||||||
7,114 | Exelon Corp. | 608,104 | |||||||||
5,651 | FirstEnergy Corp. | 427,442 | |||||||||
5,736 | FPL Group, Inc. | 380,239 | |||||||||
2,580 | Great Plains Energy, Inc. | 66,151 | |||||||||
2,430 | Hawaiian Electric Industries, Inc. | 59,900 | |||||||||
1,160 | IDACORP, Inc. | 37,630 | |||||||||
1,464 | Inetgrys Energy Group, Inc. | 70,111 | |||||||||
3,930 | Northeast Utilities | 103,438 | |||||||||
2,628 | NSTAR | 84,648 | |||||||||
5,770 | Pepco Holdings, Inc. | 143,731 | |||||||||
8,336 | PG&E Corp. | 333,440 | |||||||||
3,221 | Pinnacle West Capital Corp. | 109,321 | |||||||||
3,704 | PNM Resources, Inc. | 53,671 | |||||||||
1,770 | Portland General Electric Co. | 42,480 | |||||||||
4,709 | PPL Corp. | 226,126 | |||||||||
7,692 | Progress Energy, Inc. | 322,987 | |||||||||
7,257 | Public Service Enterprise Group, Inc. | 318,655 | |||||||||
2,786 | Puget Energy, Inc. | 75,807 | |||||||||
2,922 | SCANA Corp. | 115,214 | |||||||||
4,306 | Sierra Pacific Resources | 58,691 | |||||||||
15,450 | Southern Co. | 575,203 | |||||||||
5,977 | TECO Energy, Inc. | 95,692 | |||||||||
1,228 | Unisource Energy Corp. | 38,363 | |||||||||
2,361 | Westar Energy, Inc. | 54,752 | |||||||||
2,173 | Wisconsin Energy Corp. | 103,131 | |||||||||
12,224 | Xcel Energy, Inc. | 254,259 | |||||||||
8,781,469 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Gas - Distribution—8.8% | |||||||||||
1,633 | AGL Resources, Inc. | $ | 55,522 | ||||||||
2,920 | Atmos Energy Corp. | 80,826 | |||||||||
576 | Energen Corp. | 39,306 | |||||||||
1,181 | New Jersey Resources Corp. | 37,615 | |||||||||
1,520 | Nicor, Inc. | 53,382 | |||||||||
10,776 | NiSource, Inc. | 192,890 | |||||||||
1,503 | Piedmont Natural Gas Co., Inc. | 39,514 | |||||||||
4,331 | Sempra Energy | 245,438 | |||||||||
1,424 | Southern Union Co. | 36,483 | |||||||||
1,291 | Southwest Gas Corp. | 37,271 | |||||||||
2,603 | UGI Corp. | 67,678 | |||||||||
1,934 | Vectren Corp. | 54,694 | |||||||||
1,461 | WGL Holdings, Inc. | 47,921 | |||||||||
988,540 | |||||||||||
Independent Power Producer—3.9% | |||||||||||
6,533 | Dynegy, Inc., Class A* | 56,314 | |||||||||
2,735 | Mirant Corp.* | 112,436 | |||||||||
2,838 | NRG Energy, Inc.* | 124,730 | |||||||||
5,824 | Reliant Energy, Inc.* | 149,910 | |||||||||
443,390 | |||||||||||
Oil Companies-Exploration & Production—0.7% | |||||||||||
1,225 | Questar Corp. | 75,987 | |||||||||
Pipelines—4.9% | |||||||||||
731 | Equitable Resources, Inc. | 48,516 | |||||||||
1,340 | National Fuel Gas Co. | 68,581 | |||||||||
2,152 | ONEOK, Inc. | 103,554 | |||||||||
5,556 | Spectra Energy Corp. | 137,233 | |||||||||
5,524 | Williams (The) Cos., Inc. | 196,103 | |||||||||
553,987 | |||||||||||
Water—0.2% | |||||||||||
1,476 | Aqua America, Inc. | 27,203 | |||||||||
Total Common Stocks ` | (Cost $11,294,961) | 11,113,165 | |||||||||
Money Market Fund—0.7% | |||||||||||
79,843 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $79,843) | 79,843 | |||||||||
Total Investments (Cost $11,374,804)—99.4% | 11,193,008 | ||||||||||
Other assets less liabilities—0.6% | 65,882 | ||||||||||
Net Assets—100.0% | $ | 11,258,890 |
* Non-income producing security.
See Notes to Financial Statements.
68
This page intentionally left blank
Statements of Assets and Liabilities
PowerShares Exchange-Traded Funds
April 30, 2008
PowerShares FTSE RAFI Basic Materials Sector Portfolio | PowerShares FTSE RAFI Consumer Goods Sector Portfolio | PowerShares FTSE RAFI Consumer Services Sector Portfolio | PowerShares FTSE RAFI Energy Sector Portfolio | PowerShares FTSE RAFI Financials Sector Portfolio | |||||||||||||||||||
ASSETS: | |||||||||||||||||||||||
Investments at value | $ | 13,449,445 | $ | 4,895,012 | $ | 4,791,051 | $ | 23,407,827 | $ | 23,959,633 | |||||||||||||
Cash | 4,329 | — | 29,401 | 7,833 | — | ||||||||||||||||||
Receivables: | |||||||||||||||||||||||
Dividends | 19,369 | 4,428 | 1,448 | 2,922 | 20,942 | ||||||||||||||||||
Expense waivers due from Adviser | 13,764 | 12,986 | 14,316 | 13,655 | 16,328 | ||||||||||||||||||
Investments sold | — | — | — | — | 926,248 | ||||||||||||||||||
Total Assets | 13,486,907 | 4,912,426 | 4,836,216 | 23,432,237 | 24,923,151 | ||||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||
Due to custodian | — | 119,931 | — | — | 183,080 | ||||||||||||||||||
Payables: | |||||||||||||||||||||||
Investments purchased | — | — | — | — | 844,102 | ||||||||||||||||||
Accrued advisory fees | 5,526 | 1,991 | 1,925 | 9,327 | 9,609 | ||||||||||||||||||
Accrued expenses | 47,650 | 45,156 | 44,957 | 50,427 | 49,059 | ||||||||||||||||||
Total Liabilities | 53,176 | 167,078 | 46,882 | 59,754 | 1,085,850 | ||||||||||||||||||
NET ASSETS | $ | 13,433,731 | $ | 4,745,348 | $ | 4,789,334 | $ | 23,372,483 | $ | 23,837,301 | |||||||||||||
NET ASSETS CONSIST OF: | |||||||||||||||||||||||
Shares of beneficial interest | $ | 12,832,892 | $ | 5,379,479 | $ | 5,670,736 | $ | 21,041,299 | $ | 28,501,054 | |||||||||||||
Undistributed net investment income | 36,722 | — | 5,372 | 7,392 | 49,792 | ||||||||||||||||||
Accumulated net realized loss on investments | (62,541 | ) | (267,686 | ) | (130,179 | ) | (46,153 | ) | (1,320,671 | ) | |||||||||||||
Net unrealized appreciation (depreciation) of investments | 626,658 | (366,445 | ) | (756,595 | ) | 2,369,945 | (3,392,874 | ) | |||||||||||||||
Net Assets | $ | 13,433,731 | $ | 4,745,348 | $ | 4,789,334 | $ | 23,372,483 | $ | 23,837,301 | |||||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 200,000 | 100,000 | 100,000 | 300,000 | 600,000 | ||||||||||||||||||
Net asset value | $ | 67.17 | $ | 47.45 | $ | 47.89 | $ | 77.91 | $ | 39.73 | |||||||||||||
Investments at cost | $ | 12,822,787 | $ | 5,261,457 | $ | 5,547,646 | $ | 21,037,882 | $ | 27,352,507 |
See Notes to Financial Statements.
70
PowerShares FTSE RAFI Health Care Sector Portfolio | PowerShares FTSE RAFI Industrials Sector Portfolio | PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio | PowerShares FTSE RAFI US 1500 Small-Mid Portfolio | PowerShares FTSE RAFI Utilities Sector Portfolio | |||||||||||||||||||
ASSETS: | |||||||||||||||||||||||
Investments at value | $ | 14,381,066 | $ | 11,815,989 | $ | 10,701,315 | $ | 130,532,351 | $ | 11,193,008 | |||||||||||||
Cash | — | — | — | 409,457 | 88,300 | ||||||||||||||||||
Receivables: | |||||||||||||||||||||||
Dividends | 17,664 | 9,912 | 27,557 | 91,840 | 17,534 | ||||||||||||||||||
Expense waivers due from Adviser | 12,630 | 17,860 | 13,362 | 32,694 | 12,219 | ||||||||||||||||||
Investments sold | — | — | 16,682 | — | — | ||||||||||||||||||
Total Assets | 14,411,360 | 11,843,761 | 10,758,916 | 131,066,342 | 11,311,061 | ||||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||
Due to custodian | 127,568 | 241,026 | 152,569 | — | — | ||||||||||||||||||
Payables: | |||||||||||||||||||||||
Investments purchased | — | — | — | — | — | ||||||||||||||||||
Accrued advisory fees | 5,842 | 5,732 | 4,226 | 51,409 | 4,570 | ||||||||||||||||||
Accrued expenses | 47,517 | 45,409 | 45,891 | 71,056 | 47,601 | ||||||||||||||||||
Total Liabilities | 180,927 | 292,167 | 202,686 | 122,465 | 52,171 | ||||||||||||||||||
NET ASSETS | $ | 14,230,433 | $ | 11,551,594 | $ | 10,556,230 | $ | 130,943,877 | $ | 11,258,890 | |||||||||||||
NET ASSETS CONSIST OF: | |||||||||||||||||||||||
Shares of beneficial interest | $ | 15,907,707 | $ | 13,394,654 | $ | 11,400,401 | $ | 147,746,272 | $ | 11,692,316 | |||||||||||||
Undistributed net investment income | 65,606 | 53,160 | 51,846 | 191,096 | 51,569 | ||||||||||||||||||
Accumulated net realized loss on investments | (222,673 | ) | (442,316 | ) | (69,487 | ) | (3,945,858 | ) | (303,199 | ) | |||||||||||||
Net unrealized appreciation (depreciation) of investments | (1,520,207 | ) | (1,453,904 | ) | (826,530 | ) | (13,047,633 | ) | (181,796 | ) | |||||||||||||
Net Assets | $ | 14,230,433 | $ | 11,551,594 | $ | 10,556,230 | $ | 130,943,877 | $ | 11,258,890 | |||||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 300,000 | 200,000 | 200,000 | 2,600,000 | 200,000 | ||||||||||||||||||
Net asset value | $ | 47.43 | $ | 57.76 | $ | 52.78 | $ | 50.36 | $ | 56.29 | |||||||||||||
Investments at cost | $ | 15,901,273 | $ | 13,269,893 | $ | 11,527,845 | $ | 143,579,984 | $ | 11,374,804 |
71
Statements of Operations
Year Ended April 30, 2008
PowerShares FTSE RAFI Basic Materials Sector Portfolio | PowerShares FTSE RAFI Consumer Goods Sector Portfolio | PowerShares FTSE RAFI Consumer Services Sector Portfolio | PowerShares FTSE RAFI Energy Sector Portfolio | PowerShares FTSE RAFI Financials Sector Portfolio | |||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||
Unaffiliated dividend income | $ | 400,741 | $ | 141,931 | $ | 110,907 | $ | 291,838 | $ | 497,956 | |||||||||||||
Affiliated money market dividend income | 2,593 | 3,660 | 1,402 | 1,259 | 1,787 | ||||||||||||||||||
Foreign withholding taxes | — | — | — | — | (159 | ) | |||||||||||||||||
Total Income | 403,334 | 145,591 | 112,309 | 293,097 | 499,584 | ||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||
Administration & Accounting fees | 80,738 | 80,738 | 80,738 | 80,738 | 80,738 | ||||||||||||||||||
Advisory fees | 79,846 | 30,018 | 40,006 | 108,172 | 81,878 | ||||||||||||||||||
Sub-licensing | 15,969 | 6,004 | 8,001 | 21,634 | 16,376 | ||||||||||||||||||
Audit | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | ||||||||||||||||||
Listing fee and expenses | 13,977 | 13,742 | 13,626 | 13,810 | 13,608 | ||||||||||||||||||
Professional tax review | 10,464 | 10,464 | 10,464 | 10,464 | 10,464 | ||||||||||||||||||
Offering costs | 7,581 | 7,357 | 7,571 | 7,717 | 7,583 | ||||||||||||||||||
Custodian & transfer agent fees | 6,309 | 6,309 | 6,309 | 6,309 | 6,309 | ||||||||||||||||||
Trustees | 4,995 | 4,667 | 4,716 | 5,083 | 4,841 | ||||||||||||||||||
Printing | 2,508 | — | 749 | 3,345 | 5,366 | ||||||||||||||||||
Legal | 122 | — | — | 299 | — | ||||||||||||||||||
Registration & filings | — | — | — | — | — | ||||||||||||||||||
Other expenses | 1,153 | 744 | 523 | 865 | 749 | ||||||||||||||||||
Total Expenses | 239,510 | 175,891 | 188,551 | 274,284 | 243,760 | ||||||||||||||||||
(Waivers) and/or Recapture | (120,144 | ) | (126,504 | ) | (124,973 | ) | (115,126 | ) | (121,548 | ) | |||||||||||||
Net Expenses | 119,366 | 49,387 | 63,578 | 159,158 | 122,212 | ||||||||||||||||||
Net Investment Income | 283,968 | 96,204 | 48,731 | 133,939 | 377,372 | ||||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||||||||||
Net realized gain (loss) from: | |||||||||||||||||||||||
Investments | (62,541 | ) | (227,280 | ) | (100,839 | ) | (15,998 | ) | (1,297,718 | ) | |||||||||||||
In-kind redemptions | 4,394,923 | 1,596,904 | 379,386 | 3,531,767 | 456,542 | ||||||||||||||||||
Net realized gain (loss) | 4,332,382 | 1,369,624 | 278,547 | 3,515,769 | (841,176 | ) | |||||||||||||||||
Net change in unrealized appreciation/(depreciation) on investments | (2,732,556 | ) | (1,588,932 | ) | (1,892,273 | ) | 248,164 | (4,094,818 | ) | ||||||||||||||
Net realized and unrealized gain (loss) on investments | 1,599,826 | (219,308 | ) | (1,613,726 | ) | 3,763,933 | (4,935,994 | ) | |||||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | 1,883,794 | $ | (123,104 | ) | $ | (1,564,995 | ) | $ | 3,897,872 | $ | (4,558,622 | ) |
See Notes to Financial Statements.
72
PowerShares FTSE RAFI Health Care Sector Portfolio | PowerShares FTSE RAFI Industrials Sector Portfolio | PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio | PowerShares FTSE RAFI US 1500 Small-Mid Portfolio | PowerShares FTSE RAFI Utilities Sector Portfolio | |||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||
Unaffiliated dividend income | $ | 325,871 | $ | 706,411 | $ | 241,609 | $ | 1,934,441 | $ | 291,052 | |||||||||||||
Affiliated money market dividend income | 3,859 | 2,579 | 2,257 | 13,185 | 768 | ||||||||||||||||||
Foreign withholding taxes | (250 | ) | — | — | (6,052 | ) | — | ||||||||||||||||
Total Income | 329,480 | 708,990 | 243,866 | 1,941,574 | 291,820 | ||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||
Administration & Accounting fees | 80,738 | 80,738 | 71,730 | 71,730 | 71,730 | ||||||||||||||||||
Advisory fees | 74,613 | 192,460 | 73,521 | 597,258 | 49,783 | ||||||||||||||||||
Sub-licensing | 14,923 | 38,492 | 14,704 | 119,452 | 9,957 | ||||||||||||||||||
Audit | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | ||||||||||||||||||
Listing fee and expenses | 13,887 | 14,347 | 13,759 | 15,542 | 13,796 | ||||||||||||||||||
Professional tax review | 10,464 | 10,464 | 10,464 | 10,464 | 10,464 | ||||||||||||||||||
Offering costs | 7,509 | 7,618 | 7,593 | 7,538 | 7,518 | ||||||||||||||||||
Custodian & transfer agent fees | 6,309 | 6,466 | 6,418 | 9,126 | 6,309 | ||||||||||||||||||
Trustees | 4,911 | 5,597 | 4,928 | 7,606 | 4,746 | ||||||||||||||||||
Printing | 1,069 | 7,569 | 1,027 | 46,693 | — | ||||||||||||||||||
Legal | 30 | 1,396 | — | 4,087 | — | ||||||||||||||||||
Registration & filings | — | — | — | 1,633 | — | ||||||||||||||||||
Other expenses | 1,006 | 1,879 | 779 | 3,938 | 843 | ||||||||||||||||||
Total Expenses | 231,307 | 382,874 | 220,771 | 910,915 | 190,994 | ||||||||||||||||||
(Waivers) and/or Recapture | (119,340 | ) | (105,804 | ) | (110,248 | ) | (67,215 | ) | (113,780 | ) | |||||||||||||
Net Expenses | 111,967 | 277,070 | 110,523 | 843,700 | 77,214 | ||||||||||||||||||
Net Investment Income | 217,513 | 431,920 | 133,343 | 1,097,874 | 214,606 | ||||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||||||||||
Net realized gain (loss) from: | |||||||||||||||||||||||
Investments | (175,625 | ) | (412,458 | ) | 251 | (3,573,232 | ) | (296,440 | ) | ||||||||||||||
In-kind redemptions | 1,187,433 | 3,757,304 | 702,763 | 2,654,356 | 1,522,292 | ||||||||||||||||||
Net realized gain (loss) | 1,011,808 | 3,344,846 | 703,014 | (918,876 | ) | 1,225,852 | |||||||||||||||||
Net change in unrealized appreciation/(depreciation) on investments | (3,024,831 | ) | (4,359,652 | ) | (2,023,102 | ) | (15,981,090 | ) | (2,429,056 | ) | |||||||||||||
Net realized and unrealized gain (loss) on investments | (2,013,023 | ) | (1,014,806 | ) | (1,320,088 | ) | (16,899,966 | ) | (1,203,204 | ) | |||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | (1,795,510 | ) | $ | (582,886 | ) | $ | (1,186,745 | ) | $ | (15,802,092 | ) | $ | (988,598 | ) |
73
Statements of Changes in Net Assets
PowerShares FTSE RAFI Basic Materials Sector Portfolio | PowerShares FTSE RAFI Consumer Goods Sector Portfolio | PowerShares FTSE RAFI Consumer Services Sector Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||||||||||||||
Net investment income | $ | 283,968 | $ | 302,713 | $ | 96,204 | $ | 187,607 | $ | 48,731 | $ | 26,344 | |||||||||||||||
Net realized gain (loss) on investments | 4,332,382 | 1,794,601 | 1,369,624 | 519,025 | 278,547 | 1,181,150 | |||||||||||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | (2,732,556 | ) | 3,359,214 | (1,588,932 | ) | 1,222,487 | (1,892,273 | ) | 1,135,678 | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | 1,883,794 | 5,456,528 | (123,104 | ) | 1,929,119 | (1,564,995 | ) | 2,343,172 | |||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 11,302 | (71,185 | ) | (53,332 | ) | (23,621 | ) | (5,881 | ) | 1,129 | |||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (371,654 | ) | (203,385 | ) | (184,859 | ) | (98,952 | ) | (51,137 | ) | (18,566 | ) | |||||||||||||||
Return of capital | — | — | (4,451 | ) | — | — | — | ||||||||||||||||||||
Total distributions to shareholders | (371,654 | ) | (203,385 | ) | (189,310 | ) | (98,952 | ) | (51,137 | ) | (18,566 | ) | |||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 26,294,459 | 42,703,830 | 15,327,128 | 29,685,007 | 21,159,141 | 30,486,275 | |||||||||||||||||||||
Value of shares repurchased | (39,454,858 | ) | (22,874,983 | ) | (26,456,277 | ) | (15,328,263 | ) | (26,131,240 | ) | (21,433,316 | ) | |||||||||||||||
Net income equalization | (11,302 | ) | 71,185 | 53,332 | 23,621 | 5,881 | (1,129 | ) | |||||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | (13,171,701 | ) | 19,900,032 | (11,075,817 | ) | 14,380,365 | (4,966,218 | ) | 9,051,830 | ||||||||||||||||||
Increase (Decrease) in Net Assets | (11,648,259 | ) | 25,081,990 | (11,441,563 | ) | 16,186,911 | (6,588,231 | ) | 11,377,565 | ||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 25,081,990 | — | 16,186,911 | — | 11,377,565 | — | |||||||||||||||||||||
End of period | $ | 13,433,731 | $ | 25,081,990 | $ | 4,745,348 | $ | 16,186,911 | $ | 4,789,334 | $ | 11,377,565 | |||||||||||||||
Undistributed net investment income at end of period | $ | 36,722 | $ | 100,998 | $ | — | $ | 88,655 | $ | 5,372 | $ | 7,778 | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 400,000 | 800,000 | 300,000 | 600,000 | 400,000 | 600,000 | |||||||||||||||||||||
Shares repurchased | (600,000 | ) | (400,000 | ) | (500,000 | ) | (300,000 | ) | (500,000 | ) | (400,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 400,000 | — | 300,000 | — | 200,000 | — | |||||||||||||||||||||
Shares outstanding, end of period | 200,000 | 400,000 | 100,000 | 300,000 | 100,000 | 200,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
74
PowerShares FTSE RAFI Energy Sector Portfolio | PowerShares FTSE RAFI Financials Sector Portfolio | ||||||||||||||||||
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||||||||
Net investment income | $ | 133,939 | $ | 107,604 | $ | 377,372 | $ | 143,324 | |||||||||||
Net realized gain (loss) on investments | 3,515,769 | 3,367,103 | (841,176 | ) | 807,406 | ||||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | 248,164 | 2,121,781 | (4,094,818 | ) | 701,944 | ||||||||||||||
Net increase (decrease) in net assets resulting from operations | 3,897,872 | 5,596,488 | (4,558,622 | ) | 1,652,674 | ||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 5,134 | (15,535 | ) | 8,951 | (25,026 | ) | |||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||
Net investment income | (140,976 | ) | (93,175 | ) | (387,102 | ) | (83,164 | ) | |||||||||||
Return of capital | — | — | — | — | |||||||||||||||
Total distributions to shareholders | (140,976 | ) | (93,175 | ) | (387,102 | ) | (83,164 | ) | |||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||
Proceeds from shares sold | 42,355,170 | 47,515,291 | 23,447,399 | 41,076,550 | |||||||||||||||
Value of shares repurchased | (41,527,090 | ) | (34,231,097 | ) | (10,983,334 | ) | (26,327,100 | ) | |||||||||||
Net income equalization | (5,134 | ) | 15,535 | (8,951 | ) | 25,026 | |||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 822,946 | 13,299,729 | 12,455,114 | 14,774,476 | |||||||||||||||
Increase (Decrease) in Net Assets | 4,584,976 | 18,787,507 | 7,518,341 | 16,318,960 | |||||||||||||||
NET ASSETS: | |||||||||||||||||||
Beginning of period | 18,787,507 | — | 16,318,960 | — | |||||||||||||||
End of period | $ | 23,372,483 | $ | 18,787,507 | $ | 23,837,301 | $ | 16,318,960 | |||||||||||
Undistributed net investment income at end of period | $ | 7,392 | $ | 14,429 | $ | 49,792 | $ | 60,071 | |||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||
Shares sold | 600,000 | 900,000 | 500,000 | 800,000 | |||||||||||||||
Shares repurchased | (600,000 | ) | (600,000 | ) | (200,000 | ) | (500,000 | ) | |||||||||||
Shares outstanding, beginning of period | 300,000 | — | 300,000 | — | |||||||||||||||
Shares outstanding, end of period | 300,000 | 300,000 | 600,000 | 300,000 |
75
Statements of Changes in Net Assets (Continued)
PowerShares FTSE RAFI Health Care Sector Portfolio | PowerShares FTSE RAFI Industrials Sector Portfolio | PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income | $ | 217,513 | $ | 204,380 | $ | 431,920 | $ | 214,250 | $ | 133,343 | $ | 133,344 | |||||||||||||||
Net realized gain (loss) on investments | 1,011,808 | 524,455 | 3,344,846 | 2,066,518 | 703,014 | 1,535,580 | |||||||||||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | (3,024,831 | ) | 1,504,624 | (4,359,652 | ) | 2,905,748 | (2,023,102 | ) | 1,196,572 | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (1,795,510 | ) | 2,233,459 | (582,886 | ) | 5,186,516 | (1,186,745 | ) | 2,865,496 | ||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | (6,792 | ) | (4,231 | ) | (60,308 | ) | 8,755 | (16,374 | ) | (11,299 | ) | ||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (167,854 | ) | (188,595 | ) | (385,729 | ) | (208,432 | ) | (116,397 | ) | (98,444 | ) | |||||||||||||||
Return of capital | — | — | — | — | — | — | |||||||||||||||||||||
Total distributions to shareholders | (167,854 | ) | (188,595 | ) | (385,729 | ) | (208,432 | ) | (116,397 | ) | (98,444 | ) | |||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 16,273,363 | 45,224,207 | 49,593,398 | 68,623,129 | 23,577,926 | 41,066,412 | |||||||||||||||||||||
Value of shares repurchased | (21,982,352 | ) | (25,366,285 | ) | (78,001,088 | ) | (32,673,314 | ) | (28,666,754 | ) | (26,885,264 | ) | |||||||||||||||
Net income equalization | 6,792 | 4,231 | 60,308 | (8,755 | ) | 16,374 | 11,299 | ||||||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | (5,702,197 | ) | 19,862,153 | (28,347,382 | ) | 35,941,060 | (5,072,454 | ) | 14,192,447 | ||||||||||||||||||
Increase (Decrease) in Net Assets | (7,672,353 | ) | 21,902,786 | (29,376,305 | ) | 40,927,899 | (6,391,970 | ) | 16,948,200 | ||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 21,902,786 | — | 40,927,899 | — | 16,948,200 | — | |||||||||||||||||||||
End of period | $ | 14,230,433 | $ | 21,902,786 | $ | 11,551,594 | $ | 40,927,899 | $ | 10,556,230 | $ | 16,948,200 | |||||||||||||||
Undistributed net investment income at end of period | $ | 65,606 | $ | 15,785 | $ | 53,160 | $ | 5,984 | $ | 51,846 | $ | 34,900 | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 300,000 | 900,000 | 800,000 | 1,300,000 | 400,000 | 800,000 | |||||||||||||||||||||
Shares repurchased | (400,000 | ) | (500,000 | ) | (1,300,000 | ) | (600,000 | ) | (500,000 | ) | (500,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 400,000 | — | 700,000 | — | 300,000 | — | |||||||||||||||||||||
Shares outstanding, end of period | 300,000 | 400,000 | 200,000 | 700,000 | 200,000 | 300,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
76
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio | PowerShares FTSE RAFI Utilities Sector Portfolio | ||||||||||||||||||
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||||||||
OPERATIONS: | |||||||||||||||||||
Net investment income | $ | 1,097,874 | $ | 220,625 | $ | 214,606 | $ | 300,932 | |||||||||||
Net realized gain (loss) on investments | (918,876 | ) | 1,884,437 | 1,225,852 | 1,460,332 | ||||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | (15,981,090 | ) | 2,933,457 | (2,429,056 | ) | 2,247,260 | |||||||||||||
Net increase (decrease) in net assets resulting from operations | (15,802,092 | ) | 5,038,519 | (988,598 | ) | 4,008,524 | |||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 190,881 | 40,491 | (34,736 | ) | (61,710 | ) | |||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||
Net investment income | (1,013,277 | ) | (107,528 | ) | (255,837 | ) | (208,132 | ) | |||||||||||
Return of capital | — | — | — | — | |||||||||||||||
Total distributions to shareholders | (1,013,277 | ) | (107,528 | ) | (255,837 | ) | (208,132 | ) | |||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||
Proceeds from shares sold | 100,097,511 | 102,455,043 | 11,731,584 | 47,129,478 | |||||||||||||||
Value of shares repurchased | (38,018,141 | ) | (21,706,158 | ) | (17,566,526 | ) | (32,591,603 | ) | |||||||||||
Net income equalization | (190,881 | ) | (40,491 | ) | 34,736 | 61,710 | |||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 61,888,489 | 80,708,394 | (5,800,206 | ) | 14,599,585 | ||||||||||||||
Increase (Decrease) in Net Assets | 45,264,001 | 85,679,876 | (7,079,377 | ) | 18,338,267 | ||||||||||||||
NET ASSETS: | |||||||||||||||||||
Beginning of period | 85,679,876 | — | 18,338,267 | — | |||||||||||||||
End of period | $ | 130,943,877 | $ | 85,679,876 | $ | 11,258,890 | $ | 18,338,267 | |||||||||||
Undistributed net investment income at end of period | $ | 191,096 | $ | 111,680 | $ | 51,569 | $ | 92,800 | |||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||
Shares sold | 1,800,000 | 1,900,000 | 200,000 | 900,000 | |||||||||||||||
Shares repurchased | (700,000 | ) | (400,000 | ) | (300,000 | ) | (600,000 | ) | |||||||||||
Shares outstanding, beginning of period | 1,500,000 | — | 300,000 | — | |||||||||||||||
Shares outstanding, end of period | 2,600,000 | 1,500,000 | 200,000 | 300,000 |
77
Financial Highlights
PowerShares FTSE RAFI Basic Materials Sector Portfolio
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 62.70 | $ | 50.27 | |||||||
Net investment income** | 1.12 | 0.78 | |||||||||
Net realized and unrealized gain on investments | 4.80 | 12.31 | |||||||||
Total from operations | 5.92 | 13.09 | |||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (1.45 | ) | (0.66 | ) | |||||||
Net asset value at end of period | $ | 67.17 | $ | 62.70 | |||||||
TOTAL RETURN*** | 9.50 | % | 26.17 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 13,434 | $ | 25,082 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.75 | % | 0.76 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.50 | % | 1.18 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 1.78 | % | 2.23 | %† | |||||||
Portfolio turnover rate †† | 19 | % | 15 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | 0.05 | $ | (0.18 | ) |
PowerShares FTSE RAFI Consumer Goods Sector Portfolio
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 53.96 | $ | 49.03 | |||||||
Net investment income** | 0.83 | 0.54 | |||||||||
Net realized and unrealized gain (loss) on investments | (5.45 | ) | 4.72 | ||||||||
Total from operations | (4.62 | ) | 5.26 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (1.89 | ) | (0.33 | ) | |||||||
Return of capital | — | (a) | — | ||||||||
Total distributions | (1.89 | ) | (0.33 | ) | |||||||
Net asset value at end of period | $ | 47.45 | $ | 53.96 | |||||||
TOTAL RETURN*** | (8.80 | )% | 10.78 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 4,745 | $ | 16,187 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.82 | % | 0.76 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 2.93 | % | 1.27 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 1.60 | % | 1.67 | %† | |||||||
Portfolio turnover rate †† | 20 | % | 1 | % | |||||||
Undistributed net investment loss included in price of units issued and redeemed**# | $ | (0.46 | ) | $ | (0.07 | ) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
78
Financial Highlights (Continued)
PowerShares FTSE RAFI Consumer Services Sector Portfolio
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 56.89 | $ | 50.53 | |||||||
Net investment income** | 0.32 | 0.10 | |||||||||
Net realized and unrealized gain (loss) on investments | (9.02 | ) | 6.35 | ||||||||
Total from operations | (8.70 | ) | 6.45 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.30 | ) | (0.09 | ) | |||||||
Net asset value at end of period | $ | 47.89 | $ | 56.89 | |||||||
TOTAL RETURN*** | (15.32 | )% | 12.78 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 4,789 | $ | 11,378 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.79 | % | 0.77 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 2.36 | % | 1.40 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.61 | % | 0.28 | %† | |||||||
Portfolio turnover rate †† | 16 | % | 4 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.04 | ) | $ | — | (a) |
PowerShares FTSE RAFI Energy Sector Portfolio
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 62.63 | $ | 49.16 | |||||||
Net investment income** | 0.45 | 0.23 | |||||||||
Net realized and unrealized gain on investments | 15.30 | 13.45 | |||||||||
Total from operations | 15.75 | 13.68 | |||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.47 | ) | (0.21 | ) | |||||||
Net asset value at end of period | $ | 77.91 | $ | 62.63 | |||||||
TOTAL RETURN*** | 25.22 | % | 27.86 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 23,372 | $ | 18,788 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.74 | % | 0.74 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.27 | % | 1.09 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.62 | % | 0.66 | %† | |||||||
Portfolio turnover rate †† | 2 | % | 1 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | 0.02 | $ | (0.03 | ) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
79
Financial Highlights (Continued)
PowerShares FTSE RAFI Financials Sector Portfolio
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 54.40 | $ | 50.47 | |||||||
Net investment income** | 1.00 | 0.52 | |||||||||
Net realized and unrealized gain (loss) on investments | (14.55 | ) | 3.83 | ||||||||
Total from operations | (13.55 | ) | 4.35 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (1.12 | ) | (0.42 | ) | |||||||
Net asset value at end of period | $ | 39.73 | $ | 54.40 | |||||||
TOTAL RETURN*** | (25.22 | )% | 8.62 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 23,837 | $ | 16,319 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.75 | % | 0.78 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.49 | % | 1.44 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 2.30 | % | 1.65 | %† | |||||||
Portfolio turnover rate †† | 46 | % | 10 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | 0.02 | $ | (0.09 | ) |
PowerShares FTSE RAFI Health Care Sector Portfolio
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 54.76 | $ | 50.44 | |||||||
Net investment income** | 0.74 | 0.42 | |||||||||
Net realized and unrealized gain (loss) on investments | (7.41 | ) | 4.28 | ||||||||
Total from operations | (6.67 | ) | 4.70 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.66 | ) | (0.38 | ) | |||||||
Net asset value at end of period | $ | 47.43 | $ | 54.76 | |||||||
TOTAL RETURN*** | (12.32 | )% | 9.38 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 14,230 | $ | 21,903 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.75 | % | 0.75 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.55 | % | 1.11 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 1.46 | % | 1.33 | %† | |||||||
Portfolio turnover rate †† | 12 | % | 5 | % | |||||||
Undistributed net investment loss included in price of units issued and redeemed**# | $ | (0.02 | ) | $ | (0.01 | ) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
See Notes to Financial Statements.
80
Financial Highlights (Continued)
PowerShares FTSE RAFI Industrials Sector Portfolio
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 58.47 | $ | 50.27 | |||||||
Net investment income** | 0.66 | 0.36 | |||||||||
Net realized and unrealized gain (loss) on investments | (0.65 | ) | 8.17 | ||||||||
Total from operations | 0.01 | 8.53 | |||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.72 | ) | (0.33 | ) | |||||||
Net asset value at end of period | $ | 57.76 | $ | 58.47 | |||||||
TOTAL RETURN*** | — | %(a) | 17.01 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 11,552 | $ | 40,928 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.72 | % | 0.73 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.99 | % | 1.00 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 1.12 | % | 1.05 | %† | |||||||
Portfolio turnover rate †† | 17 | % | 3 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.09 | ) | $ | 0.02 |
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 56.49 | $ | 50.60 | |||||||
Net investment income** | 0.51 | 0.32 | |||||||||
Net realized and unrealized gain (loss) on investments | (3.74 | ) | 5.82 | ||||||||
Total from operations | (3.23 | ) | 6.14 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.48 | ) | (0.25 | ) | |||||||
Net asset value at end of period | $ | 52.78 | $ | 56.49 | |||||||
TOTAL RETURN*** | (5.79 | )% | 12.15 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 10,556 | $ | 16,948 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.75 | % | 0.75 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.50 | % | 1.17 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.91 | % | 0.97 | %† | |||||||
Portfolio turnover rate †† | 12 | % | 4 | % | |||||||
Undistributed net investment loss included in price of units issued and redeemed**# | $ | (0.06 | ) | $ | (0.03 | ) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than 0.005%.
See Notes to Financial Statements.
81
Financial Highlights (Continued)
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 57.12 | $ | 50.52 | |||||||
Net investment income** | 0.50 | 0.27 | |||||||||
Net realized and unrealized gain (loss) on investments | (6.81 | ) | 6.50 | ||||||||
Total from operations | (6.31 | ) | 6.77 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.45 | ) | (0.17 | ) | |||||||
Net asset value at end of period | $ | 50.36 | $ | 57.12 | |||||||
TOTAL RETURN*** | (11.10 | )% | 13.42 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 130,944 | $ | 85,680 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.71 | % | 0.73 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.76 | % | 0.92 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.92 | % | 0.83 | %† | |||||||
Portfolio turnover rate †† | 42 | % | 9 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.09 | $ | 0.05 |
PowerShares FTSE RAFI Utilities Sector Portfolio
Year Ended April 30, 2008 | For the Period September 20, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 61.13 | $ | 49.93 | |||||||
Net investment income** | 1.21 | 0.78 | |||||||||
Net realized and unrealized gain (loss) on investments | (4.47 | ) | 11.07 | ||||||||
Total from operations | (3.26 | ) | 11.85 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (1.58 | ) | (0.65 | ) | |||||||
Net asset value at end of period | $ | 56.29 | $ | 61.13 | |||||||
TOTAL RETURN*** | (5.41 | )% | 23.87 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 11,259 | $ | 18,338 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.78 | % | 0.75 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.92 | % | 1.19 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 2.16 | % | 2.32 | %† | |||||||
Portfolio turnover rate †† | 16 | % | 0 | %(a) | |||||||
Undistributed net investment loss included in price of units issued and redeemed**# | $ | (0.20 | ) | $ | (0.16 | ) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than 1%.
See Notes to Financial Statements.
82
Notes to Financial Statements
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the "Trust") was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company, registered under the Investment Company Act of 1940, as amended (the "1940 Act"). As of period end, the Trust offers seventy-three portfolios. This report includes the following portfolios:
PowerShares FTSE RAFI Basic Materials Sector Portfolio | "FTSE RAFI Basic Materials Sector Portfolio" | ||||||
PowerShares FTSE RAFI Consumer Goods Sector Portfolio | "FTSE RAFI Consumer Goods Sector Portfolio" | ||||||
PowerShares FTSE RAFI Consumer Services Sector Portfolio | "FTSE RAFI Consumer Services Sector Portfolio" | ||||||
PowerShares FTSE RAFI Energy Sector Portfolio | "FTSE RAFI Energy Sector Portfolio" | ||||||
PowerShares FTSE RAFI Financials Sector Portfolio | "FTSE RAFI Financials Sector Portfolio" | ||||||
PowerShares FTSE RAFI Health Care Sector Portfolio | "FTSE RAFI Health Care Sector Portfolio" | ||||||
PowerShares FTSE RAFI Industrials Sector Portfolio | "FTSE RAFI Industrials Sector Portfolio" | ||||||
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio | "FTSE RAFI Telecommunications & Technology Sector Portfolio" | ||||||
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio | "FTSE RAFI US 1500 Small-Mid Portfolio" | ||||||
PowerShares FTSE RAFI Utilities Sector Portfolio | "FTSE RAFI Utilities Sector Portfolio" | ||||||
Each portfolio (the "Fund" or collectively the "Funds") represents a separate series of the Trust. The shares of the Funds are referred to herein as "Shares" or "Fund Shares." Each Fund's shares are listed and traded on the NASDAQ.
The Funds' market prices may differ to some degree from the net asset value of the shares of each Fund. Unlike conventional mutual funds, each Fund issues and redeems shares on a continuous basis, at net asset value, only in a large specified number of shares, each called a "Creation Unit." Creation Units are issued and redeemed generally in-kind for securities included in the relevant index. Except when aggregated in Creation Units, shares are not individually redeemable securities of the Funds. The investment objective of each Fund is to seek investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of the following equity indices:
Fund | Index | ||||||
FTSE RAFI Basic Materials Sector Portfolio | FTSE RAFI Basic Materials Sector Index | ||||||
FTSE RAFI Consumer Goods Sector Portfolio | FTSE RAFI Consumer Goods Sector Index | ||||||
FTSE RAFI Consumer Services Sector Portfolio | FTSE RAFI Consumer Services Sector Index | ||||||
FTSE RAFI Energy Sector Portfolio | FTSE RAFI Oil & Gas Index | ||||||
FTSE RAFI Financials Sector Portfolio | FTSE RAFI Financials Sector Index | ||||||
FTSE RAFI Health Care Sector Portfolio | FTSE RAFI Health Care Sector Index | ||||||
83
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Fund | Index | ||||||
FTSE RAFI Industrials Sector Portfolio | FTSE RAFI Industrials Sector Index | ||||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | FTSE RAFI Telecommunications & Technology Sector Index | ||||||
FTSE RAFI US 1500 Small-Mid Portfolio | FTSE RAFI US 1500 Small-Mid Index | ||||||
FTSE RAFI Utilities Sector Portfolio | FTSE RAFI Utilities Sector Index | ||||||
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates.
A. Security Valuation
Securities, including restricted securities, are valued according to the following policy.
A security listed or traded on an exchange (except convertible bonds) 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. Listed options if no closing price is available are valued at the mean between the last bid and the ask 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 ask prices.
Investments in open-end registered investment companies are valued at the end of day net asset value per share.
Debt obligations (including convertible bonds) 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, yield, quality, type of issue, coupon rate, maturity, individual trading characteristics and other market data. Short-term obligations, including commercial paper, having 60 days or less to maturity are recorded at amortized cost which approximates value. Debt securities are subject to interest rate and credit risks. In addition, all debt securities involve some risk of default with respect to interest and/or principal payments.
Foreign securities (including foreign exchange contracts) are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. 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 are significant and may 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
84
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
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 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, ADRs 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 stric t 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.
Securities for which market quotations are not readily available or are 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/ask 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.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer's assets, general economic conditions, interest rates, investor perceptions and market liquidity.
B. Other Risk
The Funds may concentrate investments in a comparatively narrow segment of the economy. Consequently, such Fund may tend to be more volatile than other funds, and the value of the investments may tend to rise and fall more rapidly.
When investing in securities of a limited number of companies, each investment has a greater effect on the Fund's overall performance, and any change in the value of those securities could significantly affect the value of your investment in the Fund.
C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and will distribute substantially all of the Fund's taxable earnings to its shareholders. As such, the Funds will not be subject to Federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for Federal income taxes is included.
Income and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from accounting principles generally accepted in the United States. These differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and Passive Foreign Investment Company adjustments, if any.
The Funds file tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
85
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
D. Investment Income and Investment Transactions
Dividend income is recorded on the ex-dividend date net of foreign taxes withheld, if any. Interest income is recorded on the accrual basis. Investment transactions are recorded on the trade date. Realized gains and losses from the sale or disposition of securities are calculated on the specific identified cost basis. Dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
E. Expenses
Expenses of the Trust, which are directly identifiable to a specific Fund, are applied to that Fund. Expenses which are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, any distribution fees or expenses and extraordinary expenses.
F. Dividends and Distributions to Shareholders
Each Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and distributes net realized taxable capital gains, if any, annually in cash. Such distributions on a tax basis are determined in conformity with income tax regulations which may differ from accounting principles generally accepted in the United States of America. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund's financial statements as a tax return of capital at fiscal period end.
G. Equalization
All Funds use the accounting practice of equalization. This accounting method is used to keep the continuing shareholder's per share equity in undistributed net investment income from being affected by the continuous sales and redemptions of capital shares. Equalization is calculated on a per share basis whereby a portion of the proceeds from the sales and cost of repurchases of capital shares is applied to undistributed net investment income. The amount of equalization is disclosed in the Statements of Changes in Net Assets as undistributed net investment income included in the price of capital shares issued or redeemed. The distributions to shareholders of amounts so applied may be deemed to be a return of capital for tax purposes to the extent that such distributions exceed taxable income.
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with Invesco Powershares Capital Management LLC (formerly Powershares Capital Management LLC) (the "Adviser") such that the Adviser has overall responsibility as the Funds' investment adviser for the selection and ongoing monitoring of the Funds' investments, managing the Funds' business affairs and providing certain clerical, bookkeeping and other administrative services. Each Fund has agreed to pay an annual fee of 0.50% of the Fund's average daily net assets.
The Adviser has entered into an Amended and Restated Excess Expense Agreement ("Excess Expense Agreement") with the Trust, under which the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses of the Funds (excluding interest expense, brokerage commissions and other trading expenses, sub-licensing fees, offering costs, taxes and
86
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
extraordinary expenses) from exceeding 0.60% of average daily net assets per year (the "Expense Cap"), at least until August 30, 2009. Offering costs excluded from the Expense Cap are: (a) legal fees pertaining to the Funds' shares offered for sale; (b) Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange.
The Excess Expense Agreement provides that the expenses borne by the Adviser are subject to recapture by the Adviser for up to three years from the date the fee or expense was borne by the Adviser, but no recapture payment will be made by a Fund if it would result in the Fund exceeding its Expense Cap as specified above.
The net amount of fees waived and other expenses assumed by the Adviser and the amount of recapture paid to the Adviser pursuant to the Excess Expense Agreement are collectively referred to as 'Waivers and/or Recapture'.
During the year ended April 30, 2008, the amount of 'Waivers and/or Recapture' was as follows:
(Waivers) and/or Recapture | |||||||
FTSE RAFI Basic Materials Portfolio | $ | (120,144 | ) | ||||
FTSE RAFI Consumer Goods Sector Portfolio | (126,504 | ) | |||||
FTSE RAFI Consumer Services Sector Portfolio | (124,973 | ) | |||||
FTSE RAFI Energy Sector Portfolio | (115,126 | ) | |||||
FTSE RAFI Financials Sector Portfolio | (121,548 | ) | |||||
FTSE RAFI Health Care Sector Portfolio | (119,340 | ) | |||||
FTSE RAFI Industrials Sector Portfolio | (105,804 | ) | |||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | (110,248 | ) | |||||
FTSE RAFI US 1500 Small-Mid Portfolio | (67,215 | ) | |||||
FTSE RAFI Utilities Sector Portfolio | (113,780 | ) |
The net amounts of Waivers and/or Recapture are also shown on the Statements of Operations.
The amounts available for potential future recapture by the Adviser under the Excess Expense Agreement and the expiration schedule at April 30, 2008 are as follows:
Total Potential Recapture | Potential Recapture Amounts Expiring | ||||||||||||||||||
Amount | 04/30/09 | 04/30/10 | 04/30/11 | ||||||||||||||||
FTSE RAFI Basic Materials Sector Portfolio | $ | 176,132 | $ | — | $ | 54,342 | $ | 121,790 | |||||||||||
FTSE RAFI Consumer Goods Sector Portfolio | 183,663 | — | 55,817 | 127,846 | |||||||||||||||
FTSE RAFI Consumer Services Sector Portfolio | 182,883 | — | 56,594 | 126,289 | |||||||||||||||
FTSE RAFI Energy Sector Portfolio | 172,075 | — | 55,622 | 116,453 | |||||||||||||||
FTSE RAFI Financials Sector Portfolio | 178,540 | — | 55,661 | 122,879 | |||||||||||||||
FTSE RAFI Health Care Sector Portfolio | 175,996 | — | 55,339 | 120,657 | |||||||||||||||
FTSE RAFI Industrials Sector Portfolio | 160,058 | — | 52,893 | 107,165 | |||||||||||||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | 167,179 | — | 53,976 | 113,203 | |||||||||||||||
FTSE RAFI US 1500 Small-Mid Portfolio | 118,482 | — | 48,198 | 70,284 | |||||||||||||||
FTSE RAFI Utilities Sector Portfolio | 170,786 | — | 54,046 | 116,740 |
87
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Distribution Agreement
The Trust has entered into a Distribution Agreement with Invesco Aim Distributors, Inc. (formerly A I M Distributors, Inc.) (the "Distributor") which serves as the Distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in Shares.
Licensing Fee Agreement
The Adviser has entered into a licensing agreement for each Fund with the FTSE International Ltd. (the "Licensor").
The above trademark is owned by the respective Licensor. This trademark has been licensed to the Adviser for use with the Funds. The Funds are not sponsored, endorsed, sold or promoted by the Licensor and the Licensor makes no representation regarding the advisability of investing in any of these Funds. The Funds are required to pay the sub-licensing fees which are shown on the Statements of Operations.
The Bank of New York, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian and fund accounting and transfer agent for each Fund.
The custodian has agreed to provide overdraft protection to the Funds according to the terms of the service agreement.
Note 4. Federal Income Tax
At April 30, 2008, costs of investments on a tax basis including the adjustments for financial reporting purposes as of the most recently completed Federal income tax reporting year were as follows:
FTSE RAFI Basic Materials Sector Portfolio | $ | 12,830,764 | |||||
FTSE RAFI Consumer Goods Sector Portfolio | 5,277,203 | ||||||
FTSE RAFI Consumer Services Sector Portfolio | 5,550,334 | ||||||
FTSE RAFI Energy Sector Portfolio | 21,038,087 | ||||||
FTSE RAFI Financials Sector Portfolio | 27,598,433 | ||||||
FTSE RAFI Health Care Sector Portfolio | 15,936,493 | ||||||
FTSE RAFI Industrials Sector Portfolio | 13,270,768 | ||||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | 11,529,750 | ||||||
FTSE RAFI US 1500 Small Mid-Cap Portfolio | 144,826,039 | ||||||
FTSE RAFI Utilities Sector Portfolio | 11,374,804 |
88
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
At April 30, 2008, the components of accumulated earnings/loss on a tax-basis were as follows:
Accumulated Earnings | Net Accumulated Capital and other Losses | Unrealized Appreciation/ Depreciation | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Total Accumulated Earnings/Loss | ||||||||||||||||||||||
FTSE RAFI Basic Materials Sector Portfolio | $ | 36,722 | $ | (54,564 | ) | $ | 618,681 | $ | 1,554,979 | $ | (936,298 | ) | $ | 600,839 | |||||||||||||
FTSE RAFI Consumer Goods Sector Portfolio | — | (77,599 | ) | (382,191 | ) | 74,402 | (456,593 | ) | (459,790 | ) | |||||||||||||||||
FTSE RAFI Consumer Services Sector Portfolio | 5,372 | (24,830 | ) | (759,283 | ) | 117,435 | (876,718 | ) | (778,741 | ) | |||||||||||||||||
FTSE RAFI Energy Sector Portfolio | 7,392 | (26,908 | ) | 2,369,740 | 3,136,125 | (766,385 | ) | 2,350,224 | |||||||||||||||||||
FTSE RAFI Financials Sector Portfolio | 49,792 | (171,176 | ) | (3,638,800 | ) | 245,871 | (3,884,671 | ) | (3,760,184 | ) | |||||||||||||||||
FTSE RAFI Health Care Sector Portfolio | 65,606 | (124,698 | ) | (1,555,427 | ) | 545,050 | (2,100,477 | ) | (1,614,519 | ) | |||||||||||||||||
FTSE RAFI Industrials Sector Portfolio | 53,160 | (181,254 | ) | (1,454,779 | ) | 313,531 | (1,768,310 | ) | (1,582,873 | ) | |||||||||||||||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | 51,846 | (37,282 | ) | (828,435 | ) | 350,811 | (1,179,246 | ) | (813,871 | ) | |||||||||||||||||
FTSE RAFI US 1500 Small Mid-Cap Portfolio | 193,377 | (139,346 | ) | (14,293,688 | ) | 7,875,725 | (22,169,413 | ) | (14,239,657 | ) | |||||||||||||||||
FTSE RAFI Utilities Sector Portfolio | 51,569 | (64,318 | ) | (181,796 | ) | 323,899 | (505,695 | ) | (194,545 | ) |
Distributions to Shareholders:
The tax character of distributions paid was as follows:
Year ended April 30, 2008 | Period ended April 30, 2007 | ||||||||||
Distributions paid from Ordinary Income | Distributions paid from Ordinary Income | ||||||||||
FTSE RAFI Basic Materials Sector Portfolio | $ | 371,654 | $ | 203,385 | |||||||
FTSE RAFI Consumer Goods Sector Portfolio | 184,859 | 98,952 | |||||||||
FTSE RAFI Consumer Services Sector Portfolio | 51,137 | 18,566 | |||||||||
FTSE RAFI Energy Sector Portfolio | 140,976 | 93,175 | |||||||||
FTSE RAFI Financials Sector Portfolio | 387,102 | 83,164 | |||||||||
FTSE RAFI Health Care Sector Portfolio | 167,854 | 188,595 | |||||||||
FTSE RAFI Industrials Sector Portfolio | 385,729 | 208,432 | |||||||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | 116,397 | 98,444 | |||||||||
FTSE RAFI US 1500 Small Mid-Cap Portfolio | 1,013,277 | 107,528 | |||||||||
FTSE RAFI Utilities Sector Portfolio | 255,837 | 208,132 | |||||||||
Year ended April 30, 2008 | Period ended April 30, 2007 | ||||||||||
Distributions paid from Return of Capital | Distributions paid from Return of Capital | ||||||||||
FTSE RAFI Consumer Goods Sector Portfolio | $ | 4,451 | $ | — |
89
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
At April 30, 2008, for Federal income tax purposes, the Funds have capital loss carryforwards available as shown in the table below, to the extent provided by the regulations, to offset future capital gains through the years indicated. To the extent that these loss carryforwards are used to offset future capital gains, it is probable that the capital gains so offset will not be distributed to shareholders. The use of some portion of the capital loss carryforwards by any one fund may be limited by federal tax rules. These rules limit the use of the carryforwards when there has been a greater than fifty percent change in ownership of a fund.
Year of Expiration | Total | ||||||||||||||
2015 | 2016 | Amount | |||||||||||||
FTSE RAFI Basic Materials Sector Portfolio | $ | — | $ | 54,564 | $ | 54,564 | |||||||||
FTSE RAFI Consumer Goods Sector Portfolio | — | 77,599 | 77,599 | ||||||||||||
FTSE RAFI Consumer Services Sector Portfolio | 9,952 | 14,878 | 24,830 | ||||||||||||
FTSE RAFI Energy Sector Portfolio | — | 26,908 | 26,908 | ||||||||||||
FTSE RAFI Financials Sector Portfolio | 4,934 | 166,242 | 171,176 | ||||||||||||
FTSE RAFI Health Care Sector Portfolio | — | 124,698 | 124,698 | ||||||||||||
FTSE RAFI Industrials Sector Portfolio | — | 181,254 | 181,254 | ||||||||||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | 9 | 37,273 | 37,282 | ||||||||||||
FTSE RAFI US 1500 Small Mid-Cap Portfolio | 5,818 | 133,528 | 139,346 | ||||||||||||
FTSE RAFI Utilities Sector Portfolio | — | 64,318 | 64,318 |
Capital losses incurred after October 31 ("post-October losses") within the taxable year are deemed to arise on the first business day of each Fund's next taxable year.
During the year ended April 30, 2008, the Funds incurred and will elect to defer net capital losses as follows:
Post-October Losses | |||||||
FTSE RAFI Consumer Goods Sector Portfolio | $ | 174,341 | |||||
FTSE RAFI Consumer Services Sector Portfolio | 102,661 | ||||||
FTSE RAFI Energy Sector Portfolio | 19,040 | ||||||
FTSE RAFI Financials Sector Portfolio | 903,569 | ||||||
FTSE RAFI Health Care Sector Portfolio | 62,755 | ||||||
FTSE RAFI Industrials Sector Portfolio | 260,187 | ||||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | 30,300 | ||||||
FTSE RAFI US 1500 Small Mid-Cap Portfolio | 2,562,738 | ||||||
FTSE RAFI Utilities Sector Portfolio | 238,881 |
In order to present shares of beneficial interest and accumulated net realized gains or losses on the Statements of Assets and Liabilities that more closely represent their tax character, certain adjustments have been made to shares of beneficial interest, undistributed net investment income or loss and net realized gains or losses on investments. These differences are primarily due to redemptions in-kind, investments in
90
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
partnerships, wash sales, book equalization, and net operating losses, if any. These adjustments have no effect on net assets. For the year ended April 30, 2008, the adjustments were as follows:
Undistributed Net Investment Income (Loss) | Accumulated Net Realized Loss | Shares of Beneficial Interest | |||||||||||||
FTSE RAFI Basic Materials Sector Portfolio | $ | 12,108 | $ | (4,418,333 | ) | $ | 4,406,225 | ||||||||
FTSE RAFI Consumer Goods Sector Portfolio | 57,783 | (1,587,157 | ) | 1,529,374 | |||||||||||
FTSE RAFI Consumer Services Sector Portfolio | 5,881 | (379,386 | ) | 373,505 | |||||||||||
FTSE RAFI Energy Sector Portfolio | (5,134 | ) | (3,531,767 | ) | 3,536,901 | ||||||||||
FTSE RAFI Financials Sector Portfolio | (9,500 | ) | (455,926 | ) | 465,426 | ||||||||||
FTSE RAFI Health Care Sector Portfolio | 6,954 | (1,186,238 | ) | 1,179,284 | |||||||||||
FTSE RAFI Industrials Sector Portfolio | 61,293 | (3,746,975 | ) | 3,685,682 | |||||||||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | 16,374 | (702,464 | ) | 686,090 | |||||||||||
FTSE RAFI US 1500 Small Mid-Cap Portfolio | (196,062 | ) | (2,599,526 | ) | 2,795,588 | ||||||||||
FTSE RAFI Utilities Sector Portfolio | 34,736 | (1,522,292 | ) | 1,487,556 |
Note 5. Investment Transactions
For the period ended April 30, 2008, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, money market funds and in-kind transactions, were as follows:
Purchases | Sales | ||||||||||
FTSE RAFI Basic Materials Sector Portfolio | $ | 3,093,525 | $ | 3,566,535 | |||||||
FTSE RAFI Consumer Goods Sector Portfolio | 1,322,831 | 1,219,223 | |||||||||
FTSE RAFI Consumer Services Sector Portfolio | 1,259,744 | 1,507,895 | |||||||||
FTSE RAFI Energy Sector Portfolio | 397,392 | 1,583,730 | |||||||||
FTSE RAFI Financials Sector Portfolio | 7,719,917 | 8,540,875 | |||||||||
FTSE RAFI Health Care Sector Portfolio | 1,799,776 | 4,526,378 | |||||||||
FTSE RAFI Industrials Sector Portfolio | 6,793,214 | 7,405,024 | |||||||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | 1,864,803 | 1,836,863 | |||||||||
FTSE RAFI US 1500 Small-Mid Portfolio | 49,486,888 | 56,417,075 | |||||||||
FTSE RAFI Utilities Sector Portfolio | 1,601,295 | 2,893,952 |
For the period ended April 30, 2008, in-kind transactions were as follows:
Securities Received | Securities Delivered | ||||||||||
FTSE RAFI Basic Materials Sector Portfolio | 7,728,919 | 20,076,476 | |||||||||
FTSE RAFI Consumer Goods Sector Portfolio | 5,485,817 | 16,724,861 | |||||||||
FTSE RAFI Consumer Services Sector Portfolio | 10,699,073 | 15,435,773 | |||||||||
FTSE RAFI Energy Sector Portfolio | 20,204,836 | 18,303,779 | |||||||||
FTSE RAFI Financials Sector Portfolio | 18,225,557 | 4,695,974 | |||||||||
FTSE RAFI Health Care Sector Portfolio | 6,969,804 | 9,881,654 | |||||||||
FTSE RAFI Industrials Sector Portfolio | 39,093,817 | 66,459,893 | |||||||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | 6,386,155 | 11,491,990 | |||||||||
FTSE RAFI US 1500 Small-Mid Portfolio | 91,724,934 | 22,867,226 | |||||||||
FTSE RAFI Utilities Sector Portfolio | 7,589,318 | 12,210,689 |
Gains on in-kind transactions are not considered taxable gains for Federal income tax purposes.
91
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 6. Trustees' Fees
The Funds compensate each Trustee on behalf of the Trust who is not an employee of the Trust or its affiliates. Interested Trustees and Officers of the Trust do not receive any Trustees' fees.
The Trust (has adopted a deferred compensation plan (the "Plan"). Under the Plan, a trustee who is not an "interested person" (as defined in the 1940 Act) and has elected to participate in the Plan (a "participating trustee") may defer receipt of all or a portion of his compensation ("Deferral Fees"). Such Deferred Fees are deemed to be invested in selected PowerShares Funds. The Deferral Fees payable to the participating trustee is valued as of the first business dates of each calendar quarter such Fees would have been paid to the participating trustee. The value selected increases with contributions or with increases in the value of the shares selected, and the value decreases with withdrawals or with declines in the value of the shares selected.
Note 7. Capital
Shares are created and redeemed by the Trust only in Creation Unit size aggregations of 100,000. Only authorized participants are permitted to create or redeem from the Funds. Such transactions are generally permitted on an in-kind basis, with a balancing cash component to equate the transaction to the net asset value per unit of each Fund of the Trust on the transaction date. Cash may be substituted equivalent to the value of certain securities generally when they are not available in sufficient quantity for delivery, not be eligible for trading by the Authorized Participant or as a result of other market circumstances.
Note 8. Indemnifications
Under the Trust's organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust's maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
Note 9. New Accounting Pronouncement
On September 20, 2006, the FASB released Statement of Financial Accounting Standards No. 157 "Fair Value Measurement" ("FAS 157"). FAS 157 establishes an authoritative definition of fair value, sets out a framework for measuring fair value, and requires additional disclosures about fair-value measurement. The application of FAS 157 is required for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. Management has assessed the application of FAS 157 to the Funds and has determined that the adoption of FAS 157 is not expected to have a material impact on the Funds. Management intends for the Funds to adopt FAS 157 provisions during the fiscal year ending April 30, 2009.
92
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of each of the portfolios indicated in Note 1 of the financial statements (each a portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the "Trust") at April 30, 2008, and the results of each of their operations, the changes in each of their net assets, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Trust's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2008 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
New York, New York
June 30, 2008
93
Supplemental Information
Federal Income Tax Information
The percentages of investment income (dividend income plus short-term gains, if any) qualify as follows:
Qualified dividend income | Dividends-received deduction | ||||||||||
FTSE RAFI Basic Materials Sector Portfolio | 100 | % | 100 | % | |||||||
FTSE RAFI Consumer Goods Sector Portfolio | 100 | % | 100 | % | |||||||
FTSE RAFI Consumer Services Sector Portfolio | 100 | % | 100 | % | |||||||
FTSE RAFI Energy Sector Portfolio | 100 | % | 100 | % | |||||||
FTSE RAFI Financials Sector Portfolio | 100 | % | 100 | % | |||||||
FTSE RAFI Health Care Sector Portfolio | 100 | % | 100 | % | |||||||
FTSE RAFI Industrials Sector Portfolio | 100 | % | 100 | % | |||||||
FTSE RAFI Telecommunications & Technology Sector Portfolio | 100 | % | 100 | % | |||||||
FTSE RAFI US 1500 Small Mid-Cap Portfolio | 100 | % | 100 | % | |||||||
FTSE RAFI Utilities Sector Portfolio | 100 | % | 100 | % |
94
Supplemental Information (Continued)
Trustees and Officers
The Trustees who are not affiliated with the Adviser or affiliates of the Adviser ("Independent Trustees") and the Trustee who is affiliated with the Adviser ("Management Trustee") and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by the Trustee, are shown below.
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Ronn R. Bagge (b. 1958) YQA Capital Management, LLC 1755 S. Naperville Rd., Suite 100 Wheaton, IL 60187 | Trustee | Since 2003 | YQA Capital Management LLC (July 1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider) | 104 | None | ||||||||||||||||||
Marc M. Kole (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | Assistant Vice President and Controller, Priority Health (September 2005-April 2008); formerly, Interim CFO, Priority Health (July 2006-April 2007); formerly Senior Vice President of Finance, United Healthcare (health insurance) (July 2004-July 2005); formerly Senior Vice President of Finance, Oxford Health Plans (June 2000-July 2004) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
95
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
D. Mark McMillan (b. 1963) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Partner, Bell, Boyd & Lloyd LLP (1989-Present) | 104 | None | ||||||||||||||||||
Philip M. Nussbaum (b. 1961) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (formerly Betzold, Berg, Nussbaum & Heitman, Inc.) (November 2004-Present); formerly Managing Director, Communication Institute (May 2002-August 2003); formerly Executive Vice President of Finance, Betzold, Berg, Nussbaum & Heitman, Inc. (March 1994-1999) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
96
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustee | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustee | Other Directorships Held by Trustee | ||||||||||||||||||
Donald H. Wilson (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | President, Chief Operating Officer and Chief Financial Officer, AMCORE Financial, Inc. (bank holding company) (August 2007-Present), formerly Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (February 2006-August 2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (May 1995- February 2006) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
97
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Management Trustee | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex*** Overseen by Trustee | Other Directorships Held by Trustee | ||||||||||||||||||
H. Bruce Bond (b.1963)** Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chairman of the Board, Trustee and Chief Executive Officer | Since 2003 | Managing Director, Invesco PowerShares Capital Management LLC (August 2002-Present); formerly Manager, Nuveen Investments (April 1998-August 2002) | 104 | None | ||||||||||||||||||
Availability of Additional Information About Funds' Trustees
The Statement of Additional Information includes additional information about the Funds' Trustees and is available, without charge, upon request at 800.337.4246.
* This is the date the Management Trustee began serving the Trust.
** Interested person as defined in Section 2(a)(19) of the 1940 Act.
*** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
98
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Officers | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | ||||||||||||
Bruce T. Duncan (b. 1954) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Financial Officer, Treasurer and Secretary | Chief Financial Officer and Treasurer Since 2006 Secretary Since 2008 | Senior Vice President of Finance, Invesco PowerShares Capital Management LLC (September 2005-Present); Private Practice Attorney (2000-2005); Vice President of Investor Relations, The ServiceMaster Company (1994-2000); Vice President of Taxes, The ServiceMaster Company (1990-2000) | ||||||||||||
Kevin R. Gustafson (b. 1965) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Compliance Officer | Since 2004 | General Counsel Invesco PowerShares Capital Management LLC (September 2004-Present); Chief Compliance Officer, Invesco PowerShares Capital Management LLC (September 2004-April 2008); Attorney, Nyberg & Gustafson (2001-2004); Attorney, Burke, Warren, McKay & Serritella, P.C. (1997-2000) | ||||||||||||
* This is the period for which the Officers began serving the Trust. Each Officer serves a one year term, until his successor is elected.
99
Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 18, 2008, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the "Trust"), including the Independent Trustees, unanimously approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the "Adviser") and the Trust for the following 70 series (the "Funds"):
PowerShares Dynamic Market Portfolio
PowerShares Dynamic OTC Portfolio
PowerShares Golden Dragon Halter USX China Portfolio
PowerShares High Yield Equity Dividend AchieversTM Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Mid Cap Growth Portfolio
PowerShares Dynamic Mid Cap Value Portfolio
PowerShares Dynamic Small Cap Growth Portfolio
PowerShares Dynamic Small Cap Value Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Zacks Micro Cap Portfolio
PowerShares Aerospace & Defense Portfolio
PowerShares Dynamic Hardware & Consumer Electronics Portfolio
PowerShares Dynamic Telecommunications & Wireless Portfolio
PowerShares Value Line Timeliness Select Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares High Growth Rate Dividend AchieversTM Portfolio
PowerShares Zacks Small Cap Portfolio
PowerShares Dynamic Building and Construction Portfolio
PowerShares Dynamic Energy Exploration and Production Portfolio
PowerShares Dynamic Insurance Portfolio
PowerShares Dynamic Oil and Gas Services Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Utilities Portfolio
PowerShares Lux Nanotech Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares Water Resources Portfolio
PowerShares Dynamic Energy Sector Portfolio
PowerShares Dynamic Financial Sector Portfolio
PowerShares Dynamic Healthcare Sector Portfolio
PowerShares Dynamic Industrials Sector Portfolio
PowerShares Dynamic Large Cap Portfolio
PowerShares Dynamic MagniQuant Portfolio
PowerShares Dynamic Mid Cap Portfolio
PowerShares Dynamic Small Cap Portfolio
PowerShares Dynamic Technology Sector Portfolio
PowerShares Buyback AchieversTM Portfolio
PowerShares FTSE RAFI Basic Materials Sector Portfolio
PowerShares FTSE RAFI Consumer Goods Sector Portfolio
PowerShares FTSE RAFI Consumer Services Sector Portfolio
PowerShares FTSE RAFI Energy Sector Portfolio
PowerShares FTSE RAFI Financials Sector Portfolio
PowerShares FTSE RAFI Health Care Sector Portfolio
PowerShares FTSE RAFI Industrials Sector Portfolio
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares FTSE RAFI Utilities Sector Portfolio
PowerShares Cleantech Portfolio
100
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
PowerShares Dynamic Aggressive Growth Portfolio
PowerShares Dynamic Banking Portfolio
PowerShares Dynamic Basic Materials Sector Portfolio
PowerShares Dynamic Consumer Discretionary Sector Portfolio
PowerShares Dynamic Consumer Staples Sector Portfolio
PowerShares Dynamic Healthcare Services Portfolio
PowerShares Dynamic Deep Value Portfolio
PowerShares Financial Preferred Portfolio
PowerShares Listed Private Equity Portfolio
PowerShares DWA Technical Leaders Portfolio
PowerShares Value Line Industry Rotation Portfolio
PowerShares WilderHill Progressive Energy Portfolio
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as the Funds grow, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered and amounts paid to other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser's services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser's current organization, including operations assistance provided by the Adviser's parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser's portfolio transaction policies and procedures. The Trustees reviewed information on the performance of the Funds and the performance of their benchmark indices. The Trustees also reviewed reports on the correlation and tracking error between the underlying index and each Fund's performance and reviewed a report of Ibbotson Associates, a c onsultant to the Independent Trustees, that analyzed the reasons for any tracking error for certain of the Funds, which the Adviser then applied to its analysis of the tracking error between the underlying index and the performance of each Fund. The Trustees noted that, in each case, the correlation and tracking error was within the range set forth in the registration statement. The Trustees also concluded that each of the Funds is correlated to its underlying index and that the tracking error for each Fund was within a reasonable range in that Fund's particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds' administrator, custodian and transfer agent. They noted the significant amount of time and effort that had been devoted to this oversight function.
Based on their review, the Trustees found that the nature and extent of services provided to the Funds under the Investment Advisory Agreement are appropriate and that the quality is good.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund's expense ratio and the advisory fee, as compared to three categories of comparable funds selected by Lipper Inc., an independent source: exchange-traded index funds ("ETFs"), open-end
101
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
(non-ETF) index funds and open-end actively-managed funds. The Adviser supplemented the information prepared by Lipper Inc. with data it compiled on expense ratios and advisory fees of newer ETFs that recently commenced operations. The Trustees noted that the annual advisory fee charged to the Funds was identical (0.50% of average net assets), except for the advisory fee for the PowerShares High Yield Equity Dividend AchieversTM Portfolio, the PowerShares Dividend AchieversTM Portfolio, the PowerShares High Growth Rate Dividend AchieversTM Portfolio and the PowerShares International Dividend AchieversTM Portfolio (for each of which the annual advisory fee was 0.40% of average net assets), and that the Adviser had agreed to waive the fee and/or pay expenses to the extent necessary to prevent the annual operating expenses of each Fund (excluding interest expenses, licensing fees and offe ring costs (for all Funds other than the initial two Funds, the PowerShares Dynamic OTC Portfolio and the PowerShares Dynamic Market Portfolio), brokerage commissions and other trading expenses, taxes and extraordinary expenses) from exceeding 0.60% of average net assets (0.50% of average net assets for the PowerShares High Yield Equity Dividend AchieversTM Portfolio, the PowerShares Dividend AchieversTM Portfolio, the PowerShares High Growth Rate Dividend AchieversTM Portfolio and the PowerShares International Dividend AchieversTM Portfolio) at least until April 30, 2009. The Trustees noted that the Adviser represented that it does not provide investment management services to clients other than the Trust and other exchange-traded funds overseen by the Board. The Trustees noted that the advisory fees were at the higher end of the ETF peer funds, but were lower than the median of the open-end actively-managed peer funds. The Trustees determined that the advisory fe es were reasonable because of the complexity of the indices, which generally require more frequent rebalancing of the portfolios, the distinguishing factors of the Funds, and the higher administrative, operational and management oversight costs for the Adviser. With respect to the Funds' expense ratios, the Trustees noted that the net expense ratios were at the higher end of the ETF peer funds, but were generally lower than the median of the expense ratios of the open-end (non-ETF) index peer funds and the median of the open-end actively-managed peer funds. The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds. The Board concluded that the advisory fee and expense ratio of each Fund are competitive and that the advisory fee for each Fund is reasonable and appropriate in amount in light of the quality of services provided and the expense cap in place.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability as well as any profits realized by the Adviser from its relationship to each Fund. The Trustees concluded that the profitability to the Adviser of the advisory services provided to the Funds is not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund's asset size, expense ratio, expense limitation agreed to by the Adviser and whether the investment process produced economies of scale. The Trustees noted that certain fixed costs associated with the management of the Funds are being reduced on a per-Fund basis as additional Funds are added, and that the gradual reduction of the per-Fund cost enabled the Adviser to operate some of the Funds under the expense cap, which potentially would lower the costs to shareholders. The Trustees noted that the Excess Expense Agreement with the Trust provided that the Adviser was entitled to be reimbursed by
102
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
each Fund for fees waived or expenses absorbed pursuant to the expense cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its expense cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds, and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
103
This page intentionally left blank
PROXY VOTING POLICIES AND PROCEDURES
A description of the Funds' proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 337-4246. This information is also available on the Securities and Exchange Commission's ("Commission") website at www.sec.gov.
Information regarding how the Funds voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 337-4246; or (ii) accessing the Funds' Form N-PX on the Commission's website at www.sec.gov.
QUARTERLY PORTFOLIOS
The Funds file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds' Forms N-Q are available on the Commission's website at www.sec.gov. The Funds' Forms N-Q may also be reviewed and copied at the Commission's Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
There are risks involved in investing in ETFs, including possible loss of money. Investing in securities of small and medium sized companies involves greater risk than is customarily associated with investing in more established companies, and investments in concentrated industry sectors involve greater risks than investments that are more diversified. PowerShares ETFs are not actively managed and are subject to risks similar to stocks, including those related to short selling and margin maintenance. PowerShares ETFs are not FDIC insured, may lose value and have no bank guarantee. PowerShares is a registered trademark of Invesco PowerShares Capital Management LLC. Past performance is not a guarantee of future results.
Invesco Aim Distributors, Inc. is the distributor of the PowerShares Exchange-Traded Fund Trust.
An investor should consider each Fund's investment objective, risks, charges and expenses carefully before investing. For more complete information about PowerShares ETFs call Invesco Aim Distributors, Inc. at (800) 337-4246 or visit our website invescopowershares.com for a prospectus. Please read the prospectus carefully before investing.
301 West Roosevelt Road
Wheaton, IL 60187
800.983.0903
www.invescopowershares.com
© 2008 Invesco PowerShares Capital Management LLC P-PS-AR-6
2008 Annual Report to Shareholders
30 April 2008
PowerShares Dynamic Basic Materials Sector Portfolio
PowerShares Dynamic Consumer Discretionary Sector Portfolio
PowerShares Dynamic Consumer Staples Sector Portfolio
PowerShares Dynamic Energy Sector Portfolio
PowerShares Dynamic Financial Sector Portfolio
PowerShares Dynamic Healthcare Sector Portfolio
PowerShares Dynamic Industrials Sector Portfolio
PowerShares Dynamic Technology Sector Portfolio
PowerShares Dynamic Telecommunications & Wireless Portfolio
PowerShares Dynamic Utilities Portfolio
Table of Contents
Shareholder Letter | 2 | ||||||
The Market Environment | 3 | ||||||
Manager's Analysis | 4 | ||||||
Funds' Distribution History | 24 | ||||||
Frequency Distribution of Discounts & Premiums | 26 | ||||||
Fees and Expenses | 28 | ||||||
Sector Portfolios | |||||||
Schedules of Investments | |||||||
PowerShares Dynamic Basic Materials Sector Portfolio | 30 | ||||||
PowerShares Dynamic Consumer Discretionary Sector Portfolio | 32 | ||||||
PowerShares Dynamic Consumer Staples Sector Portfolio | 34 | ||||||
PowerShares Dynamic Energy Sector Portfolio | 35 | ||||||
PowerShares Dynamic Financial Sector Portfolio | 36 | ||||||
PowerShares Dynamic Healthcare Sector Portfolio | 38 | ||||||
PowerShares Dynamic Industrials Sector Portfolio | 39 | ||||||
PowerShares Dynamic Technology Sector Portfolio | 41 | ||||||
PowerShares Dynamic Telecommunications & Wireless Portfolio | 42 | ||||||
PowerShares Dynamic Utilities Portfolio | 43 | ||||||
Statements of Assets and Liabilities | 44 | ||||||
Statements of Operations | 46 | ||||||
Statements of Changes in Net Assets | 48 | ||||||
Financial Highlights | 52 | ||||||
Notes to Financial Statements | 57 | ||||||
Report of Independent Registered Public Accounting Firm | 68 | ||||||
Supplemental Information | 69 | ||||||
Information about Advisory Agreements | 75 | ||||||
To My Fellow Investors,
It gives me great pleasure to report on the state of your investment in PowerShares Exchange-Traded Funds and to thank you for your continued confidence in Invesco PowerShares Capital Management LLC.
Invesco PowerShares has accomplished a number of corporate and industry achievements in 2007. Some of the most notable successes over the past 12 months are that PowerShares:
• Was the first to receive approval from the SEC to operate actively managed equity and fixed-income ETFs.
• Launched our initial group of international ETFs, which invest directly in securities listed on foreign exchanges. As of April 30, 2008, we had 17 ETFs allowing investors to invest across a wide geographic range.
• Brought out the markets only ETFs investing in insured municipal bonds. These three ETF's were part of our initial entry into the Fixed Income portion of the investment spectrum.
• Further enhanced our reputation as one of the leading innovators in the ETF marketplace when the PowerShares S&P Buy-Write Portfolio was awarded the most innovative new ETF for 2007.
• Expanded our global footprint with the introduction of 14 PowerShares ETFs listed on four major stock exchanges across Europe (London, Milan, Frankfurt and Paris).
• Launched the PowerShares India Portfolio, one of the first ETFs to provide U.S. investors with direct access to securities listed on the India stock exchange.
Another milestone of the past year was the adoption of our new name, Invesco PowerShares – in short, we have a new corporate name. Invesco PowerShares represents the strength of global diversification you get through the combination of Invesco's worldwide resources and PowerShares' market leading ETF capabilities. As one of the world's largest and most diversified global investment organizations, Invesco has more than 500 investment professionals operating in investment centers in 25 cities, a presence in 12 countries and $500 billion in assets under management globally at the end of 2007.
While our name has changed and we have a new corporate logo, our goal of delivering the highest quality investment management available in the ETF structure has not changed and all of the names of your funds and their trading symbols remain the same – as do all of our telephone contact numbers. All of us at Invesco PowerShares will continue to strive to provide you with compelling investment solutions and high-quality customer service. Regardless of market conditions, Invesco PowerShares will hold true to its mission: seeking to build financial security for investors.
Best Regards,
H. Bruce Bond
President and Chairman of the Board of Trustees
PowerShares Exchange-Traded Fund Trust
2
The Market Environment
Although the benchmark S&P 500 index hit an all-time high in October, 2007, it capitulated as the subprime mortgage crisis began to negatively affect the balance sheets of major U.S. financial institutions. As a result, volatility (as measured by the CBOE "VIX" index) increased by 46.2% during the April 30, 2007 to April 30, 2008 reporting period. Another dramatic rise over the same timeframe was the price of crude oil, which rallied 72.7%. U.S. economic growth began to slow significantly in Q1 2008, leading to recession concerns addressed by the Federal Reserve Bank through aggressive monetary policy easing (the Fed Fund target rate was cut by 2.25% in 2008). The combination of lower short-term U.S. interest rates and the recycling of petrodollars into European banks caused the U.S. dollar to weaken versus all G7 currencies for the year ended April 30, 2008.
By March, 2008, even the AAA-rated monoline bond insurers succumbed to the U.S. credit crunch. Bond insurer ratings downgrades led to huge displacements within the municipal bond market. An impending liquidity crisis was quelled in mid-March by the Fed via the creation of a $200bn lending facility and the approval of Bear Stearns' sale to JP Morgan. Along with the restoration of confidence in the U.S. financial system came a respectable April rally in the U.S. equity market, leaving the S&P 500 with a yearly total return of -4.68% over the reporting period while the DJIA was 0.47% and the NASDAQ-100 was +3.18%. For the same period, the Lehman Brothers U.S. Aggregate Total Return bond index was 6.87%.
3
Manager's Analysis
PowerShares Dynamic Basic Materials Sector Portfolio (ticker: PYZ)
The PowerShares Dynamic Basic Materials Sector Portfolio is based on the Dynamic Basic Materials Sector IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
For the year ending April 30, 2008, the Fund returned 15.47%, outperforming the overall S&P Materials Index which returned 12.78%.
Stock selection within the chemical and metals & mining industries made the largest positive contribution to the Fund. Also, underallocation in the construction materials and paper & forest product industries made positive contributions to the Fund. Conversely, overallocation within the containers & packaging industries partially offset the positive performance of the Fund. Stock selection within mid-cap value companies such as CF Industries Holdings, Inc., and underallocation within large-cap value companies made the largest positive contributor to the Fund's performance. Conversely, overallocation in small-cap value companies partially offset the performance of the Fund.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Chemicals-Specialty | 19.8 | ||||||
Chemicals-Diversified | 15.8 | ||||||
Steel-Producers | 13.6 | ||||||
Agricultural Chemicals | 7.5 | ||||||
Industrial Gases | 6.6 | ||||||
Containers-Metal/Glass | 6.5 | ||||||
Paper & Related Products | 6.1 | ||||||
Containers-Paper/Plastic | 4.2 | ||||||
Chemicals-Plastics | 2.8 | ||||||
Coatings/Paint | 2.7 | ||||||
Forestry | 2.5 | ||||||
Metal-Copper | 2.4 | ||||||
Metal-Aluminum | 2.3 | ||||||
Metal-Iron | 1.8 | ||||||
Miscellaneous Manufacturing | 1.6 | ||||||
Diversified Manufacturing Operations | 1.5 | ||||||
Non-Ferrous Metals | 1.2 | ||||||
Alternative Waste Technology | 1.1 | ||||||
Money Market Fund | 0.6 | ||||||
Other | (0.6 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
United States Steel Corp. | 3.4 | ||||||
Nucor Corp. | 2.8 | ||||||
Praxair, Inc. | 2.7 | ||||||
Mosaic (The) Co. | 2.6 | ||||||
Air Products & Chemicals, Inc. | 2.6 | ||||||
Dow Chemical (The) Co. | 2.6 | ||||||
E.l. du pont de Nemours & Co. | 2.5 | ||||||
Weyerhaeuser Co. | 2.5 | ||||||
Southern Copper Corp. | �� | 2.4 | |||||
Rohm & Haas Co. | 2.4 | ||||||
Total | 26.5 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Mid-Cap Value | 30.5 | ||||||
Small-Cap Value | 20.6 | ||||||
Large-Cap Value | 20.4 | ||||||
Mid-Cap Growth | 13.2 | ||||||
Large-Cap Growth | 12.7 | ||||||
Small-Cap Growth | 2.6 |
4
Manager's Analysis (Continued)
PowerShares Dynamic Basic Materials Sector Portfolio (ticker: PYZ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Basic Materials Sector IntellidexSM Index | 16.38 | 27.52 | 45.89 | ||||||||||||
S&P Materials Index | 12.78 | 21.98 | 36.17 | ||||||||||||
Dow Jones Basic Materials Index | 20.58 | 26.98 | 44.95 |
Fund
NAV Return | 15.47 | 26.55 | 43.97 | ||||||||||||
Share Price Return | 15.33 | 26.51 | 44.00 |
Fund Inception: 12 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.77%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.68% while the Fund's gross total operating expense ratio was 0.96%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Materials Index and the Dow Jones Basic Materials Index are unmanaged indices used as measurements of changes in stock market conditions based on the average performance of approximately 29 and 90 common stocks, respectively.
† Average annualized.
5
Manager's Analysis
PowerShares Dynamic Consumer Discretionary Sector Portfolio (ticker: PEZ)
The PowerShares Dynamic Consumer Discretionary Sector Portfolio is based on the Dynamic Consumer Discretionary Sector IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
For the year ending April 30, 2008, the Fund returned -21.10%, underperforming the overall S&P Consumer Discretionary Index which returned -16.30%.
Stock selection within specialty retails and hotels restaurants & leisure and overallocation to airlines made the largest negative contribution to the Fund's performance. Furthermore, stock selection within multiline retail contributed negatively to the Fund. Conversely, overallocation within diversified consumer services partially offset the negative performance of the Fund.
Overallocation within small-cap value companies and underallocation within large-cap growth companies made the largest negative contribution to the Fund's performance. Conversely, stock selection within mid-cap growth companies partially offset the negative performance of the Fund.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Retail | 37.6 | ||||||
Media | 17.5 | ||||||
Commercial Services | 7.9 | ||||||
Auto Parts & Equipment | 5.4 | ||||||
Hand/Machine Tools | 4.3 | ||||||
Airlines | 3.4 | ||||||
Leisure Time | 3.0 | ||||||
Toys/Games/Hobbies | 3.0 | ||||||
Internet | 2.9 | ||||||
Advertising | 2.7 | ||||||
Household Products/Wares | 2.6 | ||||||
Home Furnishings | 2.1 | ||||||
Apparel | 1.5 | ||||||
Distribution/Wholesale | 1.5 | ||||||
Entertainment | 1.5 | ||||||
Home Builders | 1.5 | ||||||
Textiles | 1.4 | ||||||
Money Market Fund | 0.6 | ||||||
Other | (0.4 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Yum! Brands, Inc. | 3.0 | ||||||
Coach, Inc. | 2.9 | ||||||
McDonald's Corp. | 2.8 | ||||||
E.W. Scripps Co., Class A | 2.7 | ||||||
Omnicom Group, Inc. | 2.7 | ||||||
CBS Corp., Class B | 2.5 | ||||||
TJX (The) Cos., Inc. | 2.5 | ||||||
DISH Network Corp., Class A | 2.5 | ||||||
Best Buy Co., Inc. | 2.5 | ||||||
DIRECTV Group (The), Inc. | 2.5 | ||||||
Total | 26.6 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Small-Cap Value | 24.3 | ||||||
Mid-Cap Value | 24.0 | ||||||
Mid-Cap Growth | 19.1 | ||||||
Large-Cap Growth | 12.9 | ||||||
Large-Cap Value | 11.9 | ||||||
Small-Cap Growth | 7.8 |
6
Manager's Analysis (Continued)
PowerShares Dynamic Consumer Discretionary Sector Portfolio (ticker: PEZ)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Consumer Discretionary Sector IntellidexSM Index | -20.55 | -6.42 | -9.79 | ||||||||||||
S&P Consumer Discretionary Index | -16.30 | -6.98 | -10.63 | ||||||||||||
Dow Jones Consumer Services Index | -13.59 | -4.82 | -7.39 |
Fund
NAV Return | -21.10 | -7.09 | -10.75 | ||||||||||||
Share Price Return | -21.09 | -7.02 | -10.68 |
Fund Inception: 12 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.92%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.70% while the Fund's gross total operating expense ratio was 1.31%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Consumer Discretionary Index and the Dow Jones Consumer Services Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 88 and 250 common stocks, respectively.
† Average annualized.
7
Manager's Analysis
PowerShares Dynamic Consumer Staples Sector Portfolio (ticker: PSL)
The PowerShares Dynamic Consumer Staples Sector Portfolio is based on the Dynamic Consumer Staples Sector IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
For the year ending April 30, 2008, the Fund returned -3.94%, underperforming the overall S&P Consumer Staples Index which returned 5.53%.
Stock selection within food & staples retailing, and overallocation within personal products made the largest negative contribution to the Fund. Stock selection within beverage industries also contributed to the negative performance of the Fund. Conversely, overallocation within distributor industries partially offset the negative returns of the Fund.
Overallocation within small-cap value companies and stock selection within large-cap value companies made the largest negative contribution to the Fund's performance. Furthermore, overallocation within mid-cap value companies also contributed to the negative return of the Fund.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Food | 40.2 | ||||||
Beverages | 17.9 | ||||||
Agriculture | 13.2 | ||||||
Retail | 10.6 | ||||||
Cosmetics/Personal Care | 10.1 | ||||||
Household Products/Wares | 6.3 | ||||||
Pharmaceuticals | 1.3 | ||||||
Money Market Fund | 0.3 | ||||||
Other | 0.1 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Large-Cap Value | 27.8 | ||||||
Small-Cap Value | 23.3 | ||||||
Large-Cap Growth | 20.6 | ||||||
Mid-Cap Value | 19.2 | ||||||
Mid-Cap Growth | 5.3 | ||||||
Small-Cap Growth | 3.8 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Wm. Wrigley Jr. Co. | 3.1 | ||||||
Wal-Mart Stores, Inc. | 2.9 | ||||||
Kroger (The) Co. | 2.7 | ||||||
Sysco Corp. | 2.7 | ||||||
General Mills, Inc. | 2.6 | ||||||
Anheuser-Busch Cos., Inc. | 2.5 | ||||||
Procter & Gamble (The) Co. | 2.5 | ||||||
Kellogg Co. | 2.5 | ||||||
Coca-Cola (The) Co. | 2.5 | ||||||
CVS Caremark Corp. | 2.4 | ||||||
Total | 26.4 |
8
Manager's Analysis (Continued)
PowerShares Dynamic Consumer Staples Sector Portfolio (ticker: PSL)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Consumer Staples Sector IntellidexSM Index | -3.33 | 5.91 | 9.33 | ||||||||||||
S&P Consumer Staples Index | 5.53 | 9.70 | 15.48 | ||||||||||||
Dow Jones Consumer Goods Index | -3.85 | 3.58 | 5.62 |
Fund
NAV Return | -3.94 | 5.26 | 8.26 | ||||||||||||
Share Price Return | -4.03 | 5.22 | 8.22 |
Fund Inception: 12 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 2.01%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.69% while the Fund's gross total operating expense ratio was 1.18%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Consumer Staples Index and the Dow Jones Consumer Goods Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 39 and 160 common stocks, respectively.
† Average annualized.
9
Manager's Analysis
PowerShares Dynamic Energy Sector Portfolio (ticker: PXI)
The PowerShares Dynamic Energy Sector Portfolio is based on the Dynamic Energy Sector IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
For the year ending April 30, 2008, the Fund returned 21.93%, underperforming the overall S&P Energy Index which returned 28.69%.
Overallocation within gas utilities, and stock selection within the energy equipment & services industry made the largest negative contribution to the Fund. Conversely, stock selection within oil gas & consumable fuels industry partially offset the negative performance of the Fund.
Lastly, overallocation in small-cap value and mid-cap value companies provided the majority of the Fund's negative returns. Conversely, underallocation within large-cap value companies such as Exxon Mobil Corp., and overallocation within small-cap growth companies made the largest positive contribution to the Fund's performance.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Oil Companies-Exploration & Production | 31.0 | ||||||
Oil-Field Services | 14.6 | ||||||
Gas-Distribution | 11.7 | ||||||
Oil Companies-Integrated | 10.0 | ||||||
Oil & Gas Drilling | 9.3 | ||||||
Oil Field Machinery & Equipment | 8.6 | ||||||
Coal | 5.9 | ||||||
Transport-Marine | 2.9 | ||||||
Electric-Integrated | 1.4 | ||||||
Pipelines | 1.3 | ||||||
Energy-Alternate Sources | 1.2 | ||||||
Transport-Services | 1.2 | ||||||
Oil Refining & Marketing | 0.9 | ||||||
Money Market Fund | 0.3 | ||||||
Other | (0.3 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Halliburton Co. | 2.7 | ||||||
Apache Corp. | 2.7 | ||||||
Schlumberger Ltd. | 2.7 | ||||||
Cameron International Corp. | 2.7 | ||||||
Noble Corp. | 2.6 | ||||||
Hess Corp. | 2.6 | ||||||
Noble Energy, Inc. | 2.6 | ||||||
Chevron Corp. | 2.5 | ||||||
Devon Energy Corp. | 2.5 | ||||||
EOG Resources, Inc. | 2.5 | ||||||
Total | 26.1 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Large-Cap Value | 30.3 | ||||||
Small-Cap Value | 20.8 | ||||||
Mid-Cap Growth | 20.5 | ||||||
Mid-Cap Value | 17.7 | ||||||
Small-Cap Growth | 5.4 | ||||||
Large-Cap Growth | 5.3 |
10
Manager's Analysis (Continued)
PowerShares Dynamic Energy Sector Portfolio (ticker: PXI)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Energy Sector IntellidexSM Index | 22.76 | 31.17 | 52.44 | ||||||||||||
S&P Energy Index | 28.69 | 32.42 | 54.70 | ||||||||||||
Dow Jones Oil & Gas Index | 27.43 | 31.88 | 53.73 |
Fund
NAV Return | 21.93 | 30.46 | 50.92 | ||||||||||||
Share Price Return | 21.74 | 30.36 | 50.86 |
Fund Inception: 12 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.60%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.68% while the Fund's gross total operating expense ratio was 0.96%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Energy Index and the Dow Jones Oil & Gas Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 34 and 70 common stocks, respectively.
† Average annualized.
11
Manager's Analysis
PowerShares Dynamic Financial Sector Portfolio (ticker: PFI)
The PowerShares Dynamic Financial Sector Portfolio is based on the Dynamic Financial Sector IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
For the year ending April 30, 2008, the Fund returned -12.69%, outperforming the overall S&P Financials Index which returned -26.28%.
Overallocation within the insurance industries and underallocation within thrifts & mortgage industries made the largest positive contribution to the Fund. Furthermore, stock selection within commercial banks also made large, positive contributions to the Fund. Conversely, underallocation within real estate investment trusts partially offset the positive performance of the Fund, relative to the broader US financials market.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Property/Casualty Insurances | 23.9 | ||||||
Multi-line Insurance | 18.5 | ||||||
Finance-Investment Banker | 10.7 | ||||||
Life/Health Insurance | 10.5 | ||||||
Fiduciary Banks | 7.4 | ||||||
Insurance Brokers | 5.6 | ||||||
Reinsurance | 5.4 | ||||||
Investment Management/ Advisory Service | 4.5 | ||||||
Commercial Banks-Western U.S. | 3.0 | ||||||
Commercial Banks-Central U.S. | 2.8 | ||||||
Finance-Credit Card | 2.8 | ||||||
Finance-Other Services | 2.0 | ||||||
Commercial Banks-Eastern U.S. | 1.5 | ||||||
Data Processing/Management | 1.2 | ||||||
Money Market Fund | 0.6 | ||||||
Other | (0.4 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
American Express Co. | 2.8 | ||||||
Charles Schwab (The) Corp. | 2.7 | ||||||
Northern Trust Corp. | 2.7 | ||||||
AON Corp. | 2.7 | ||||||
Travelers (The) Cos., Inc. | 2.7 | ||||||
ACE Ltd. | 2.6 | ||||||
AFLAC, Inc. | 2.6 | ||||||
Allstate (The) Corp. | 2.6 | ||||||
MetLife, Inc. | 2.6 | ||||||
Chubb (The) Corp. | 2.6 | ||||||
Total | 26.6 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Mid-Cap Value | 26.8 | ||||||
Large-Cap Value | 23.1 | ||||||
Small-Cap Value | 22.3 | ||||||
Large-Cap Growth | 15.6 | ||||||
Mid-Cap Growth | 8.2 | ||||||
Small-Cap Growth | 4.0 |
12
Manager's Analysis (Continued)
PowerShares Dynamic Financial Sector Portfolio (ticker: PFI)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Financial Sector IntellidexSM Index | -12.04 | -4.37 | -6.71 | ||||||||||||
S&P Financials Index | -26.28 | -14.64 | -21.80 | ||||||||||||
Dow Jones Financials Index | -26.89 | -16.00 | -23.74 |
Fund
NAV Return | -12.69 | -5.04 | -7.69 | ||||||||||||
Share Price Return | -12.78 | -5.01 | -7.67 |
Fund Inception: 12 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.85%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.72% while the Fund's gross total operating expense ratio was 1.42%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Financials Index and the Dow Jones Financials Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 93 and 300 common stocks, respectively.
† Average annualized.
13
Manager's Analysis
PowerShares Dynamic Healthcare Sector Portfolio (ticker: PTH)
The PowerShares Dynamic Healthcare Sector Portfolio is based on the Dynamic Healthcare Sector IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
For the year ending April 30, 2008, the Fund returned -9.51%, outperforming the overall S&P Health Care Index, which returned -11.11%.
Overallocation to the health care equipment & supplies, and stock selection within biotechnology had the largest positive effect upon the performance of the Fund. Conversely, underallocation within health care providers & services partially offset the positive returns of the Fund.
Lastly, overallocation in mid-cap growth and small-cap growth companies provided the majority of the Fund's positive returns. Conversely, overallocation within mid-cap value and small-cap value companies made the largest negative contribution to the Fund's performance.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Healthcare-Services | 29.0 | ||||||
Healthcare-Products | 24.5 | ||||||
Pharmaceuticals | 23.1 | ||||||
Electronics | 10.9 | ||||||
Biotechnology | 5.8 | ||||||
Commercial Services | 3.8 | ||||||
Distribution/Wholesale | 1.5 | ||||||
Internet | 1.4 | ||||||
Other | 0.0 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Mid-Cap Growth | 30.4 | ||||||
Small-Cap Growth | 22.5 | ||||||
Large-Cap Growth | 21.4 | ||||||
Small-Cap Value | 12.6 | ||||||
Mid-Cap Value | 8.3 | ||||||
Large-Cap Value | 4.8 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Express Scripts, Inc. | 3.1 | ||||||
Baxter International, Inc. | 2.7 | ||||||
Thermo Fisher Scientific, Inc. | 2.7 | ||||||
Waters Corp. | 2.7 | ||||||
C.R. Bard, Inc. | 2.6 | ||||||
Becton, Dickinson & Co. | 2.6 | ||||||
Abbott Laboratories | 2.6 | ||||||
AmerisourceBergen Corp. | 2.5 | ||||||
Millennium Pharmaceuticals, Inc. | 2.5 | ||||||
CIGNA Corp. | 2.5 | ||||||
Total | 26.5 |
14
Manager's Analysis (Continued)
PowerShares Dynamic Healthcare Sector Portfolio (ticker: PTH)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Healthcare Sector IntellidexSM Index | -8.81 | 2.98 | 4.66 | ||||||||||||
S&P Health Care Index | -11.11 | -1.67 | -2.59 | ||||||||||||
Dow Jones Healthcare Index | -10.59 | -2.12 | -3.27 |
Fund
NAV Return | -9.51 | 2.21 | 3.44 | ||||||||||||
Share Price Return | -9.58 | 2.18 | 3.40 |
Fund Inception: 12 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.59%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.66% while the Fund's gross total operating expense ratio was 0.72%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Health Care Index and the Dow Jones Healthcare Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 51 and 180 common stocks, respectively.
† Average annualized.
15
Manager's Analysis
PowerShares Dynamic Industrials Sector Portfolio (ticker: PRN)
The PowerShares Dynamic Industrials Sector Portfolio is based on the Dynamic Industrials Sector IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
For the year ending April 30, 2008, the Fund returned 3.90%, outperforming the overall S&P Industrials Index, which returned 3.04%.
Underallocation within industrial conglomerates and machinery, and stock selection within air freight & logistics made the largest positive contribution to the Fund's performance. Conversely, overallocation within commercial services & supplies partially offset the positive returns of the Fund.
Overallocation within mid-cap growth companies, and stock selection within mid-cap value companies made the largest positive contribution to the Fund's performance. Conversely, overallocation within small-cap growth and small-cap value companies partially offset the positive performance of the Fund.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Aerospace/Defense | 22.1 | ||||||
Miscellaneous Manufacturing | 17.4 | ||||||
Transportation | 12.9 | ||||||
Commercial Services | 10.7 | ||||||
Engineering & Construction | 9.9 | ||||||
Machinery-Diversified | 8.7 | ||||||
Environmental Control | 3.7 | ||||||
Electrical Components & Equipment | 2.8 | ||||||
Retail | 2.6 | ||||||
Metal Fabricate/Hardware | 2.5 | ||||||
Electric | 1.6 | ||||||
Electronics | 1.5 | ||||||
Hand/Machine Tools | 1.5 | ||||||
Textiles | 1.3 | ||||||
Telecommunications | 1.0 | ||||||
Money Market Fund | 0.4 | ||||||
Other | (0.6 | ) |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Parker Hannifin Corp. | 2.9 | ||||||
Dover Corp. | 2.8 | ||||||
Goodrich Corp. | 2.7 | ||||||
Norfolk Southern Corp. | 2.6 | ||||||
General Dynamics Corp. | 2.6 | ||||||
Fluor Corp. | 2.6 | ||||||
Eaton Corp. | 2.5 | ||||||
Jacobs Engineering Group, Inc. | 2.5 | ||||||
L-3 Communications Holdings, Inc. | 2.4 | ||||||
Republic Services, Inc. | 2.4 | ||||||
Total | 26.0 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Mid-Cap Growth | 25.6 | ||||||
Small-Cap Value | 19.1 | ||||||
Large-Cap Value | 17.5 | ||||||
Mid-Cap Value | 16.4 | ||||||
Small-Cap Growth | 14.0 | ||||||
Large-Cap Growth | 7.4 |
16
Manager's Analysis (Continued)
PowerShares Dynamic Industrials Sector Portfolio (ticker: PRN)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Industrials Sector IntellidexSM Index | 4.58 | 12.42 | 19.95 | ||||||||||||
S&P Industrials Index | 3.04 | 7.26 | 11.50 | ||||||||||||
Dow Jones Industrials Index | 0.65 | 6.82 | 10.79 |
Fund
NAV Return | 3.90 | 11.73 | 18.74 | ||||||||||||
Share Price Return | 3.54 | 11.52 | 18.42 |
Fund Inception: 12 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.55%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.68% while the Fund's gross total operating expense ratio was 0.90%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Industrials Index and the Dow Jones Industrials Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 56 and 270 common stocks, respectively.
† Average annualized.
17
Manager's Analysis
PowerShares Dynamic Technology Sector Portfolio (ticker: PTF)
The PowerShares Dynamic Technology Sector Portfolio is based on the Dynamic Technology Sector IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
For the year ending April 30, 2008, the Fund returned -10.55%, underperforming the overall S&P Information Technology Index, which returned 1.00%.
Overallocation within IT services, and stock selection within semiconductors & semiconductors equipment industries made the largest negative contribution to the Fund. Furthermore, stock selection within internet software & service, and underallocation within computers & peripherals also made negative contributions to the Fund.
Overallocation within small-cap value, small-cap growth and mid-cap value companies made the largest negative contribution to the Fund's performance. Conversely, stock selection within mid-cap growth companies partially offset the negative performance of the Fund.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Computers | 24.8 | ||||||
Semiconductors | 23.2 | ||||||
Software | 19.1 | ||||||
Telecommunications | 12.3 | ||||||
Electronics | 10.2 | ||||||
Commercial Services | 5.4 | ||||||
Internet | 3.6 | ||||||
Machinery-Diversified | 1.4 | ||||||
Other | 0.0 |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Large-Cap Growth | 24.7 | ||||||
Small-Cap Growth | 24.3 | ||||||
Mid-Cap Growth | 23.5 | ||||||
Mid-Cap Value | 15.7 | ||||||
Small-Cap Value | 9.3 | ||||||
Large-Cap Value | 2.5 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
Apple, Inc. | 3.2 | ||||||
Amphenol Corp., Class A | 2.9 | ||||||
NetApp, Inc. | 2.6 | ||||||
Intel Corp. | 2.6 | ||||||
Oracle Corp. | 2.6 | ||||||
Adobe Systems, Inc. | 2.6 | ||||||
Harris Corp. | 2.6 | ||||||
BMC Sofware, Inc. | 2.5 | ||||||
International Business Machines Corp. | 2.5 | ||||||
Cisco Systems, Inc. | 2.5 | ||||||
Total | 26.6 |
18
Manager's Analysis (Continued)
PowerShares Dynamic Technology Sector Portfolio (ticker: PTF)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Technology Sector IntellidexSM Index | -9.94 | -1.12 | -1.74 | ||||||||||||
S&P Information Technology Index | 1.00 | 5.24 | 8.25 | ||||||||||||
Dow Jones Technology Index | -0.37 | 4.06 | 6.39 |
Fund
NAV Return | -10.55 | -1.81 | -2.78 | ||||||||||||
Share Price Return | -10.69 | -1.85 | -2.86 |
Fund Inception: 12 October 2006
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.65%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.68% while the Fund's gross total operating expense ratio was 0.94%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P Information Technology Index and the Dow Jones Technology Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of approximately 70 and 252 common stocks, respectively.
† Average annualized.
19
Manager's Analysis
PowerShares Dynamic Telecommunications & Wireless Portfolio (ticker: PTE)
The PowerShares Dynamic Telecommunications & Wireless Portfolio is based on the Dynamic Telecommunications and Wireless IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
For the year ending April 30, 2008, the Fund returned -20.96%, underperforming the overall S&P SuperComposite Telecommunications Services Index, which returned 1.00%.
Overallocation within diversified telecommunication services, media, IT services and wireless telecommunication services made the largest negative contribution to the Fund. Conversely, overallocation within electronic equipment & instruments partially offset the negative returns of the Fund.
Overallocation within small-cap growth, small-cap value and mid-cap value companies made the largest negative contribution to the Fund's performance. Conversely, stock selection within large-cap value companies partially offset the negative performance of the Fund.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Telephone-Integrated | 31.9 | ||||||
Cable TV | 17.7 | ||||||
Telecommunication Equipment | 9.0 | ||||||
Telecommunication Services | 8.3 | ||||||
Web Portals/ISP | 6.3 | ||||||
Networking Products | 5.2 | ||||||
Wireless Equipment | 5.1 | ||||||
Cellular Telecommunications | 4.9 | ||||||
Broadcast Services/Program | 4.6 | ||||||
Electronic Components-Miscellaneous | 3.4 | ||||||
Electronic Measuring Instruments | 3.2 | ||||||
Money Market Fund | 1.4 | ||||||
Other | (1.0 | ) |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Large-Cap Growth | 29.3 | ||||||
Small-Cap Value | 18.1 | ||||||
Small-Cap Growth | 17.4 | ||||||
Large-Cap Value | 13.7 | ||||||
Mid-Cap Growth | 13.5 | ||||||
Mid-Cap Value | 8.0 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
AT&T, Inc. | 5.5 | ||||||
Verizon Communications, Inc. | 5.2 | ||||||
Cisco Systems, Inc. | 5.2 | ||||||
Comcast Corp., Class A | 5.2 | ||||||
DISH Network Corp., Class A | 5.0 | ||||||
DIRECTV Group (The), Inc. | 4.9 | ||||||
Liberty Global, Inc., Series A | 4.7 | ||||||
Plantronics, Inc. | 3.6 | ||||||
Garmin Ltd. | 3.4 | ||||||
Earthlink, Inc. | 3.4 | ||||||
Total | 46.1 |
20
Manager's Analysis (Continued)
PowerShares Dynamic Telecommunications & Wireless Portfolio (ticker: PTE)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Telecommunications and Wireless IntellidexSM Index | -20.96 | 3.02 | 7.44 | ||||||||||||
S&P SuperComposite Telecommunications Services Index | 1.00 | 3.88 | 9.61 | ||||||||||||
Russell 3000® Index | -5.16 | 5.72 | 14.33 |
Fund
NAV Return | -20.96 | 2.43 | 5.92 | ||||||||||||
Share Price Return | -20.99 | 2.44 | 5.95 |
Fund Inception: 6 December 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 1.06%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 1.01%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Telecommunications Services Index and the Russell 3000® Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of 70 and 2,918 common stocks, respectively.
† Average annualized.
21
Manager's Analysis
PowerShares Dynamic Utilities Portfolio (ticker: PUI)
The PowerShares Dynamic Utilities Portfolio is based on the Dynamic Utilities IntellidexSM Index which seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of that equity index.
For the year ending April 30, 2008, the Fund returned -5.34%, underperforming the overall S&P SuperComposite Utilities Index, which returned -0.61%.
Stock selection within the electric utilities, and overallocation within the gas utility industry made the largest negative contribution to the Fund. Conversely, stock selection within the multi-utilities industry, and overallocation within the consumer services & supply industry partially offset the negative performance of the Fund.
Stock selection within large-cap value companies such as Sempra Energy, and overallocation within mid-cap value companies made the largest negative contribution to the Fund's performance. Conversely, stock selection within mid-cap growth companies partially offset the negative performance of the Fund.
Industry Breakdown (% of the Fund's
Net Assets) as of 30 April 2008
Electric-Integrated | 65.2 | ||||||
Gas-Distribution | 21.1 | ||||||
Independent Power Producer | 8.5 | ||||||
Pipelines | 2.8 | ||||||
Energy-Alternate Sources | 2.4 | ||||||
Money Market Fund | 0.6 | ||||||
Other | (0.6 | ) |
Style Allocation (% of the Fund's Total
Investments) as of 30 April 2008
Large-Cap Value | 35.2 | ||||||
Mid-Cap Value | 26.9 | ||||||
Small-Cap Value | 22.4 | ||||||
Mid-Cap Growth | 10.8 | ||||||
Large-Cap Growth | 4.7 |
Top Ten Fund Holdings (% of the Fund's
Net Assets) as of 30 April 2008
Security | |||||||
FirstEnergy Corp. | 5.3 | ||||||
Dominion Resources, Inc. | 5.1 | ||||||
Sempra Energy | 5.0 | ||||||
PG&E Corp. | 5.0 | ||||||
PPL Corp. | 5.0 | ||||||
Edison International | 5.0 | ||||||
Duke Energy Corp. | 4.9 | ||||||
Public Service Enterprise Group, Inc. | 4.7 | ||||||
Unisource Energy Corp. | 3.4 | ||||||
Reliant Energy, Inc. | 2.9 | ||||||
Total | 46.3 |
22
Manager's Analysis (Continued)
PowerShares Dynamic Utilities Portfolio (ticker: PUI)
Growth of a $10,000 Investment Since Inception
Fund Performance History (%) As of 30 April 2008
Index
Avg. Ann.† | Fund Inception | ||||||||||||||
1 Year | Avg. Ann.† | Cumulative | |||||||||||||
Dynamic Utilities IntellidexSM Index | -4.75 | 12.09 | 33.31 | ||||||||||||
S&P SuperComposite Utilities Index | -0.61 | 14.70 | 41.28 | ||||||||||||
Russell 3000® Index | -5.16 | 8.14 | 21.80 |
Fund
NAV Return | -5.34 | 11.41 | 31.14 | ||||||||||||
Share Price Return | -5.47 | 11.40 | 31.17 |
Fund Inception: 26 October 2005
Performance may be higher or lower than the performance quoted. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost. The Adviser has waived fees and reimbursed other expenses, absent which, performance would have been lower. The Adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 30, 2009. According to the Fund's current prospectus, the total gross annual operating expense ratio was indicated as 0.87%. In the Financial Highlights section of this Shareholder Report, the Fund's net (subsidized) total operating expense ratio was determined to be 0.63% while the Fund's gross total operating expense ratio was 0.86%. NAV and Share Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Share Price, respectively. The returns shown in the table above do not refl ect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invescopowershares.com to find the most recent month-end performance numbers.
The Index performance results are based upon a hypothetical investment in its constituent securities. Index returns do not represent Fund returns. An investor cannot invest directly in an index. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.
The S&P SuperComposite Utilities Index and the Russell 3000® Index are unmanaged indices used as measurements of change in stock market conditions based on the average performance of 31 and 2,918 common stocks, respectively.
† Average annualized.
23
Funds' Distribution History
Ex-Dividend | 3/20/08 | 12/21/07 | 9/21/07 | 6/15/07 | 3/16/07 | ||||||||||||||||||||||
Record | 3/25/08 | 12/26/07 | 9/25/07 | 6/19/07 | 3/20/07 | ||||||||||||||||||||||
Payable | 3/31/08 | 12/31/07 | 9/28/07 | 6/29/07 | 3/30/07 | ||||||||||||||||||||||
Fund | Ticker | ||||||||||||||||||||||||||
Dynamic Basic Materials Sector Portfolio | PYZ | 0.00563 | 0.09972 | 0.07226 | 0.06573 | 0.03850 | |||||||||||||||||||||
Dynamic Consumer Discretionary Sector Portfolio | PEZ | — | 0.04133 | — | 0.08893 | — | |||||||||||||||||||||
Dynamic Consumer Staples Sector Portfolio | PSL | — | — | 0.07164 | 0.24346 | 0.03510 | |||||||||||||||||||||
Dynamic Energy Sector Portfolio | PXI | 0.00394 | 0.00191 | 0.04850 | 0.02896 | 0.00830 | |||||||||||||||||||||
Dynamic Financial Sector Portfolio | PFI | 0.00634 | 0.04436 | 0.09995 | 0.08027 | 0.01860 | |||||||||||||||||||||
Dynamic Healthcare Sector Portfolio | PTH | — | — | — | — | — | |||||||||||||||||||||
Dynamic Industrials Sector Portfolio | PRN | 0.08647 | 0.02055 | 0.01726 | 0.02460 | 0.03620 | |||||||||||||||||||||
Dynamic Technology Sector Portfolio | PTF | — | — | — | — | — | |||||||||||||||||||||
Dynamic Telecommunications & Wireless Portfolio | PTE | — | 0.35472 | 0.03843 | 0.05650 | — | |||||||||||||||||||||
Dynamic Utilities Portfolio | PUI | 0.02491 | 0.20450 | 0.09948 | 0.11750 | 0.08250 |
24
12/15/06 | 9/15/06 | 6/16/06 | 3/17/06 | 12/16/05 | |||||||||||||||||||
12/19/06 | 9/16/06 | 6/20/06 | 3/21/06 | 12/20/05 | |||||||||||||||||||
12/29/06 | 9/29/06 | 6/30/06 | 3/30/06 | 12/30/05 | |||||||||||||||||||
Fund | |||||||||||||||||||||||
Dynamic Basic Materials Sector Portfolio | 0.15875 | NA | NA | NA | NA | ||||||||||||||||||
Dynamic Consumer Discretionary Sector Portfolio | 0.16398 | NA | NA | NA | NA | ||||||||||||||||||
Dynamic Consumer Staples Sector Portfolio | 0.23925 | NA | NA | NA | NA | ||||||||||||||||||
Dynamic Energy Sector Portfolio | 0.02386 | NA | NA | NA | NA | ||||||||||||||||||
Dynamic Financial Sector Portfolio | 0.06758 | NA | NA | NA | NA | ||||||||||||||||||
Dynamic Healthcare Sector Portfolio | — | NA | NA | NA | NA | ||||||||||||||||||
Dynamic Industrials Sector Portfolio | 0.01397 | NA | NA | NA | NA | ||||||||||||||||||
Dynamic Technology Sector Portfolio | — | NA | NA | NA | NA | ||||||||||||||||||
Dynamic Telecommunications & Wireless Portfolio | 0.14163 | 0.03081 | 0.03188 | 0.03180 | 0.00158 | ||||||||||||||||||
Dynamic Utilities Portfolio | 0.13668 | 0.06053 | 0.10547 | 0.07089 | 0.11650 |
25
Frequency Distribution of Discounts & Premiums
Since Inception through April 30, 2008
Closing Price Above NAV (bps) | |||||||||||||||||||||||||||||||||||||||
Ticker | Fund Name | Inception | Days | 0-24 | 25-49 | 50-99 | 100-149 | 150-199 | 200+ | ||||||||||||||||||||||||||||||
PYZ | Dynamic Basic Materials Sector Portfolio | 10/12/06 | 389 | 168 | 4 | — | — | — | — | ||||||||||||||||||||||||||||||
PEZ | Dynamic Consumer Discretionary Sector Portfolio | 10/12/06 | 389 | 157 | 10 | — | — | — | — | ||||||||||||||||||||||||||||||
PSL | Dynamic Consumer Staples Sector Portfolio | 10/12/06 | 389 | 151 | 7 | 2 | — | — | — | ||||||||||||||||||||||||||||||
PXI | Dynamic Energy Sector Portfolio | 10/12/06 | 389 | 132 | 4 | 1 | — | — | — | ||||||||||||||||||||||||||||||
PFI | Dynamic Financial Sector Portfolio | 10/12/06 | 389 | 158 | 5 | — | — | — | — | ||||||||||||||||||||||||||||||
PTH | Dynamic Healthcare Sector Portfolio | 10/12/06 | 389 | 158 | 5 | 7 | — | — | — | ||||||||||||||||||||||||||||||
PRN | Dynamic Industrials Sector Portfolio | 10/12/06 | 389 | 182 | 3 | 2 | — | — | — | ||||||||||||||||||||||||||||||
PTF | Dynamic Technology Sector Portfolio | 10/12/06 | 389 | 149 | 44 | 8 | — | — | — | ||||||||||||||||||||||||||||||
PTE | Dynamic Telecommunications & Wireless Portfolio | 12/6/05 | 603 | 243 | 29 | 6 | 1 | — | — | ||||||||||||||||||||||||||||||
PUI | Dynamic Utilities Portfolio | 10/26/05 | 631 | 255 | 13 | 2 | — | — | — |
26
Closing Price Below NAV (bps) | |||||||||||||||||||||||||||
Ticker | -0-24 | -25-49 | -50-99 | -100-149 | -150-199 | -200+ | |||||||||||||||||||||
PYZ | 215 | 2 | — | — | — | — | |||||||||||||||||||||
PEZ | 217 | 5 | — | — | — | — | |||||||||||||||||||||
PSL | 227 | 2 | — | — | — | — | |||||||||||||||||||||
PXI | 252 | — | — | — | — | — | |||||||||||||||||||||
PFI | 223 | 3 | — | — | — | — | |||||||||||||||||||||
PTH | 217 | 2 | — | — | — | — | |||||||||||||||||||||
PRN | 199 | 3 | — | — | — | — | |||||||||||||||||||||
PTF | 185 | 3 | — | — | — | — | |||||||||||||||||||||
PTE | 308 | 14 | 2 | — | — | — | |||||||||||||||||||||
PUI | 355 | 6 | — | — | — | — |
27
Fees and Expenses
As a shareholder of a Fund of the PowerShares Exchange-Traded Fund Trust, you incur Fund expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in mutual funds.
The example is based on an investment of $1,000 invested at the beginning of the period and held through the six-month period ended April 30, 2008.
Actual Expenses
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, 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 first line under the heading "Expenses Paid During the Six-Month Period" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds' actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Funds' 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 Funds 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 tables are meant to highlight your ongoing costs only, and do not reflect any transactional costs such as sales charges (loads). Therefore the second line in the table 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 transactional costs were included, your costs would have been higher.
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Dynamic Basic Materials Sector Portfolio Actual | $ | 1,000.00 | $ | 995.33 | 0.65 | % | $ | 3.22 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | 0.65 | % | $ | 3.27 | |||||||||||
PowerShares Dynamic Consumer Discretionary Sector Portfolio Actual | $ | 1,000.00 | $ | 828.92 | 0.65 | % | $ | 2.96 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | 0.65 | % | $ | 3.27 | |||||||||||
PowerShares Dynamic Consumer Staples Sector Portfolio Actual | $ | 1,000.00 | $ | 949.92 | 0.65 | % | $ | 3.15 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | 0.65 | % | $ | 3.27 |
28
Fees and Expenses (Continued)
Beginning Account Value November 1, 2007 | Ending Account Value April 30, 2008 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period (1) | ||||||||||||||||
PowerShares Dynamic Energy Sector Portfolio Actual | $ | 1,000.00 | $ | 1,078.52 | 0.65 | % | $ | 3.36 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | 0.65 | % | $ | 3.27 | |||||||||||
PowerShares Dynamic Financial Sector Portfolio Actual | $ | 1,000.00 | $ | 883.42 | 0.65 | % | $ | 3.04 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | 0.65 | % | $ | 3.27 | |||||||||||
PowerShares Dynamic Healthcare Sector Portfolio Actual | $ | 1,000.00 | $ | 867.24 | 0.65 | % | $ | 3.02 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | 0.65 | % | $ | 3.27 | |||||||||||
PowerShares Dynamic Industrials Sector Portfolio Actual | $ | 1,000.00 | $ | 941.38 | 0.65 | % | $ | 3.14 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | 0.65 | % | $ | 3.27 | |||||||||||
PowerShares Dynamic Technology Sector Portfolio Actual | $ | 1,000.00 | $ | 856.81 | 0.65 | % | $ | 3.00 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | 0.65 | % | $ | 3.27 | |||||||||||
PowerShares Dynamic Telecommunications & Wireless Portfolio Actual | $ | 1,000.00 | $ | 734.07 | 0.63 | % | $ | 2.72 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 | |||||||||||
PowerShares Dynamic Utilities Portfolio Actual | $ | 1,000.00 | $ | 957.69 | 0.63 | % | $ | 3.07 | |||||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.73 | 0.63 | % | $ | 3.17 |
(1) Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six months ended April 30, 2008. Expenses are calculated by multiplying the Fund's annualized expense ratio by the average account value for the period; then multiplying the result by 182 and then dividing the result by 366. Expense ratios for the most recent half-year may differ from expense ratios based on the one year data in the financial highlights.
29
Schedule of Investments
PowerShares Dynamic Basic Materials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Agricultural Chemicals—7.5% | |||||||||||
4,668 | CF Industries Holdings, Inc. | $ | 624,112 | ||||||||
9,032 | Monsanto Co. | 1,029,829 | |||||||||
9,387 | Mosaic (The) Co.* | 1,150,001 | |||||||||
12,605 | Terra Industries, Inc. | 477,225 | |||||||||
3,281,167 | |||||||||||
Alternative Waste Technology—1.1% | |||||||||||
34,876 | Calgon Carbon Corp.* | 496,983 | |||||||||
Chemicals - Diversified—15.8% | |||||||||||
14,650 | Celanese Corp., Series A | 655,588 | |||||||||
27,720 | Dow Chemical (The) Co. | 1,112,957 | |||||||||
22,507 | E.I. du Pont de Nemours & Co. | 1,100,817 | |||||||||
10,067 | FMC Corp. | 632,006 | |||||||||
29,650 | Olin Corp. | 598,041 | |||||||||
16,857 | PPG Industries, Inc. | 1,034,514 | |||||||||
18,569 | Rockwood Holdings, Inc.* | 685,382 | |||||||||
19,488 | Rohm & Haas Co. | 1,041,634 | |||||||||
6,860,939 | |||||||||||
Chemicals - Plastics—2.8% | |||||||||||
27,881 | A. Schulman, Inc. | 591,077 | |||||||||
87,674 | PolyOne Corp.* | 647,034 | |||||||||
1,238,111 | |||||||||||
Chemicals - Specialty—19.8% | |||||||||||
15,021 | Albemarle Corp. | 561,936 | |||||||||
12,902 | Ashland, Inc. | 684,064 | |||||||||
68,993 | Chemtura Corp. | 477,432 | |||||||||
9,949 | Cytec Industries, Inc. | 587,090 | |||||||||
8,659 | Eastman Chemical Co. | 636,437 | |||||||||
22,329 | Ecolab, Inc. | 1,026,241 | |||||||||
25,050 | H.B. Fuller Co. | 578,154 | |||||||||
31,107 | Hercules, Inc. | 584,812 | |||||||||
9,775 | Lubrizol (The) Corp. | 570,078 | |||||||||
9,454 | Minerals Technologies, Inc. | 640,414 | |||||||||
8,512 | NewMarket Corp. | 552,684 | |||||||||
9,415 | OM Group, Inc.* | 515,565 | |||||||||
21,154 | Sensient Technologies Corp. | 629,755 | |||||||||
10,358 | Sigma-Aldrich Corp. | 590,613 | |||||||||
8,635,275 | |||||||||||
Coatings/Paint—2.7% | |||||||||||
27,254 | RPM International, Inc. | 607,764 | |||||||||
26,274 | Valspar (The) Corp. | 577,503 | |||||||||
1,185,267 | |||||||||||
Containers - Metal/Glass—6.5% | |||||||||||
22,877 | Crown Holdings, Inc.* | 614,019 | |||||||||
8,715 | Greif, Inc., Class A | 562,989 | |||||||||
18,508 | Owens-Illinois, Inc.* | 1,020,716 | |||||||||
12,193 | Silgan Holdings, Inc. | 649,643 | |||||||||
2,847,367 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Containers - Paper/Plastic—4.2% | |||||||||||
22,961 | Bemis Co., Inc. | $ | 603,874 | ||||||||
22,507 | Pactiv Corp.* | 535,442 | |||||||||
20,230 | Sonoco Products Co. | 666,578 | |||||||||
1,805,894 | |||||||||||
Diversified Manufacturing Operations—1.5% | |||||||||||
13,643 | Koppers Holdings, Inc. | 660,867 | |||||||||
Forestry—2.5% | |||||||||||
17,072 | Weyerhaeuser Co. | 1,090,559 | |||||||||
Industrial Gases—6.6% | |||||||||||
11,440 | Air Products & Chemicals, Inc. | 1,126,039 | |||||||||
11,728 | Airgas, Inc. | 564,469 | |||||||||
13,014 | Praxair, Inc. | 1,188,308 | |||||||||
2,878,816 | |||||||||||
Metal - Aluminum—2.3% | |||||||||||
28,131 | Alcoa, Inc. | 978,396 | |||||||||
Metal - Copper—2.4% | |||||||||||
9,156 | Southern Copper Corp. | 1,050,743 | |||||||||
Metal - Iron—1.8% | |||||||||||
4,771 | Cleveland-Cliffs, Inc. | 765,268 | |||||||||
Miscellaneous Manufacturing—1.6% | |||||||||||
15,205 | AptarGroup, Inc. | 671,301 | |||||||||
Non-Ferrous Metals—1.2% | |||||||||||
36,298 | Horsehead Holding Corp.* | 508,898 | |||||||||
Paper & Related Products—6.1% | |||||||||||
52,718 | Buckeye Technologies, Inc.* | 454,956 | |||||||||
43,271 | Glatfelter | 631,324 | |||||||||
32,958 | International Paper Co. | 862,511 | |||||||||
21,241 | Rock-Tenn Co., Class A | 720,707 | |||||||||
2,669,498 | |||||||||||
Steel - Producers—13.6% | |||||||||||
10,830 | AK Steel Holding Corp. | 679,907 | |||||||||
9,070 | Carpenter Technology Corp. | 465,110 | |||||||||
16,181 | Nucor Corp. | 1,221,666 | |||||||||
10,276 | Reliance Steel & Aluminum Co. | 624,575 | |||||||||
8,704 | Schnitzer Steel Industries, Inc., Class A | 765,952 | |||||||||
19,563 | Steel Dynamics, Inc. | 681,771 | |||||||||
9,634 | United States Steel Corp. | 1,483,154 | |||||||||
5,922,135 | |||||||||||
Total Common Stocks (Cost $39,633,114) | 43,547,484 |
See Notes to Financial Statements.
30
Schedule of Investments (Continued)
PowerShares Dynamic Basic Materials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Money Market Fund—0.6% | |||||||||||
244,133 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $244,133) | $ | 244,133 | ||||||||
Total Investments (Cost $39,877,247)—100.6% | 43,791,617 | ||||||||||
Liabilities in excess of other assets—(0.6%) | (241,596 | ) | |||||||||
Net Assets—100.0% | $ | 43,550,021 |
* Non-income producing security.
See Notes to Financial Statements.
31
Schedule of Investments
Powershares Dynamic Consumer Discretionary Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.8% | |||||||||||
Advertising—2.7% | |||||||||||
6,273 | Omnicom Group, Inc. | $ | 299,473 | ||||||||
Airlines—3.4% | |||||||||||
6,321 | Continental Airlines, Inc., Class B* | 113,652 | |||||||||
7,818 | Republic Airways Holdings, Inc.* | 131,811 | |||||||||
6,909 | SkyWest, Inc. | 131,478 | |||||||||
376,941 | |||||||||||
Apparel—1.5% | |||||||||||
5,767 | Wolverine World Wide, Inc. | 165,744 | |||||||||
Auto Parts & Equipment—5.4% | |||||||||||
3,063 | Autoliv, Inc. | 187,578 | |||||||||
8,458 | Cooper Tire & Rubber Co. | 111,138 | |||||||||
5,640 | Goodyear Tire & Rubber (The) Co.* | 151,039 | |||||||||
5,542 | Lear Corp.* | 158,335 | |||||||||
608,090 | |||||||||||
Commercial Services—7.9% | |||||||||||
4,566 | Apollo Group, Inc., Class A* | 232,409 | |||||||||
2,345 | Morningstar, Inc.* | 135,963 | |||||||||
3,208 | Pre-Paid Legal Services, Inc.* | 140,318 | |||||||||
8,912 | Rent-A-Center, Inc.* | 191,875 | |||||||||
982 | Strayer Education, Inc. | 182,348 | |||||||||
882,913 | |||||||||||
Distribution/Wholesale—1.5% | |||||||||||
4,749 | Fossil, Inc.* | 169,967 | |||||||||
Entertainment—1.5% | |||||||||||
6,022 | DreamWorks Animation SKG, Inc., Class A* | 168,375 | |||||||||
Hand/Machine Tools—4.3% | |||||||||||
2,222 | Black & Decker (The) Corp. | 145,830 | |||||||||
3,061 | Snap-On, Inc. | 181,548 | |||||||||
3,149 | Stanley Works (The) | 151,908 | |||||||||
479,286 | |||||||||||
Home Builders—1.5% | |||||||||||
283 | NVR, Inc.* | 173,621 | |||||||||
Home Furnishings—2.1% | |||||||||||
3,321 | Whirlpool Corp. | 241,702 | |||||||||
Household Products/Wares—2.6% | |||||||||||
7,707 | Blyth, Inc. | 129,786 | |||||||||
4,189 | Tupperware Brands Corp. | 165,046 | |||||||||
294,832 | |||||||||||
Internet—2.9% | |||||||||||
4,840 | NetFlix, Inc.* | 154,783 | |||||||||
1,341 | Priceline.com, Inc.* | 171,165 | |||||||||
325,948 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Leisure Time—3.0% | |||||||||||
4,003 | Polaris Industries, Inc. | $ | 186,339 | ||||||||
4,025 | WMS Industries, Inc.* | 145,665 | |||||||||
332,004 | |||||||||||
Media—17.5% | |||||||||||
12,279 | CBS Corp., Class B | 283,277 | |||||||||
11,186 | DIRECTV Group (The), Inc.* | 275,623 | |||||||||
9,450 | DISH Network Corp., Class A* | 281,988 | |||||||||
6,708 | E.W. Scripps Co., Class A | 301,257 | |||||||||
32,245 | Gemstar-TV Guide International, Inc.* | 129,947 | |||||||||
12,066 | Liberty Media Corp. Capital, Series A* | 185,454 | |||||||||
3,525 | Meredith Corp. | 114,245 | |||||||||
4,383 | Scholastic Corp.* | 123,381 | |||||||||
7,049 | Viacom, Inc., Class B* | 270,964 | |||||||||
1,966,136 | |||||||||||
Retail—37.6% | |||||||||||
3,614 | Abercrombie & Fitch Co., Class A | 268,556 | |||||||||
5,690 | Aeropostale, Inc.* | 180,885 | |||||||||
7,152 | American Eagle Outfitters, Inc. | 131,382 | |||||||||
6,363 | AnnTaylor Stores Corp.* | 160,984 | |||||||||
12,518 | Bebe Stores, Inc. | 125,055 | |||||||||
6,515 | Best Buy Co., Inc. | 280,275 | |||||||||
3,366 | Buckle (The), Inc. | 163,520 | |||||||||
5,956 | Burger King Holdings, Inc. | 166,172 | |||||||||
7,850 | Charlotte Russe Holding, Inc.* | 124,658 | |||||||||
9,241 | Coach, Inc.* | 328,703 | |||||||||
3,698 | Columbia Sportswear Co. | 155,168 | |||||||||
13,892 | Gap (The), Inc. | 258,669 | |||||||||
3,860 | Gymboree Corp.* | 166,829 | |||||||||
5,819 | Jack in the Box, Inc.* | 155,658 | |||||||||
5,178 | McDonald's Corp. | 308,506 | |||||||||
7,936 | Movado Group, Inc. | 173,322 | |||||||||
2,457 | Polo Ralph Lauren Corp. | 152,604 | |||||||||
8,759 | RadioShack Corp. | 121,750 | |||||||||
8,756 | TJX (The) Cos., Inc. | 282,119 | |||||||||
5,311 | Urban Outfitters, Inc.* | 181,902 | |||||||||
8,133 | Yum! Brands, Inc. | 330,851 | |||||||||
4,217,568 | |||||||||||
Textiles—1.4% | |||||||||||
2,141 | Mohawk Industries, Inc.* | 163,123 | |||||||||
Toys/Games/Hobbies—3.0% | |||||||||||
5,931 | Hasbro, Inc. | 210,907 | |||||||||
5,468 | JAKKS Pacific, Inc.* | 128,443 | |||||||||
339,350 | |||||||||||
Total Common Stocks (Cost $11,566,367) | 11,205,073 |
See Notes to Financial Statements.
32
Schedule of Investments (Continued)
Powershares Dynamic Consumer Discretionary Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Money Market Fund—0.6% | |||||||||||
67,175 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $67,175) | $ | 67,175 | ||||||||
Total Investments (Cost $11,633,542)—100.4% | 11,272,248 | ||||||||||
Liabilities in excess of other assets—(0.4%) | (45,290 | ) | |||||||||
Net Assets—100.0% | $ | 11,226,958 |
* Non-income producing security.
See Notes to Financial Statements.
33
Schedule of Investments
PowerShares Dynamic Consumer Staples Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.6% | |||||||||||
Agriculture—13.2% | |||||||||||
25,999 | Altria Group, Inc. | $ | 519,980 | ||||||||
6,911 | Andersons (The), Inc. | 314,105 | |||||||||
12,997 | Archer-Daniels-Midland Co. | 572,648 | |||||||||
2,885 | Bunge Ltd. | 329,150 | |||||||||
4,247 | Carolina Group | 278,900 | |||||||||
9,199 | Reynolds American, Inc. | 495,366 | |||||||||
5,618 | Universal Corp. | 360,619 | |||||||||
17,395 | Vector Group Ltd. | 299,716 | |||||||||
3,170,484 | |||||||||||
Beverages—17.9% | |||||||||||
12,448 | Anheuser-Busch Cos., Inc. | 612,442 | |||||||||
5,014 | Brown-Forman Corp., Class B | 341,052 | |||||||||
5,495 | Central European Distribution Corp.* | 334,755 | |||||||||
10,027 | Coca-Cola (The) Co. | 590,289 | |||||||||
5,846 | Coca-Cola Bottling Co. Consolidated | 334,508 | |||||||||
13,087 | Coca-Cola Enterprises, Inc. | 294,458 | |||||||||
16,644 | Constellation Brands, Inc., Class A* | 305,584 | |||||||||
7,704 | Hansen Natural Corp.* | 272,645 | |||||||||
5,925 | Molson Coors Brewing Co., Class B | 324,927 | |||||||||
9,401 | Pepsi Bottling Group (The), Inc. | 316,908 | |||||||||
8,427 | PepsiCo, Inc. | 577,502 | |||||||||
4,305,070 | |||||||||||
Cosmetics/Personal Care—10.1% | |||||||||||
11,930 | Alberto-Culver Co. | 300,278 | |||||||||
8,401 | Avon Products, Inc. | 327,807 | |||||||||
7,703 | Colgate-Palmolive Co. | 544,602 | |||||||||
17,548 | Elizabeth Arden, Inc.* | 324,813 | |||||||||
7,509 | Estee Lauder (The) Cos., Inc., Class A | 342,485 | |||||||||
8,857 | Procter & Gamble (The) Co. | 593,863 | |||||||||
2,433,848 | |||||||||||
Food—40.2% | |||||||||||
9,902 | Campbell Soup Co. | 344,590 | |||||||||
15,619 | Chiquita Brands International, Inc.* | 355,332 | |||||||||
14,467 | ConAgra Foods, Inc. | 340,843 | |||||||||
35,604 | Del Monte Foods Co. | 321,148 | |||||||||
14,110 | Flowers Foods, Inc. | 365,308 | |||||||||
9,627 | Fresh Del Monte Produce, Inc. | 305,080 | |||||||||
10,469 | General Mills, Inc. | 632,328 | |||||||||
11,807 | Great Atlantic & Pacific Tea Co., Inc.* | 324,929 | |||||||||
7,248 | H.J. Heinz Co. | 340,873 | |||||||||
7,825 | Hormel Foods Corp. | 308,383 | |||||||||
6,246 | J.M. Smucker (The) Co. | 311,550 | |||||||||
11,557 | Kellogg Co. | 591,372 | |||||||||
24,172 | Kroger (The) Co. | 658,687 | |||||||||
8,611 | Lancaster Colony Corp. | 328,854 | |||||||||
9,281 | McCormick & Co., Inc. | 350,729 | |||||||||
9,117 | Nash Finch Co. | 333,500 | |||||||||
9,838 | Performance Food Group Co.* | 329,179 | |||||||||
5,766 | Ralcorp Holdings, Inc.* | 351,957 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
9,914 | Ruddick Corp. | $ | 383,672 | ||||||||
11,125 | Safeway, Inc. | 351,550 | |||||||||
25,315 | Sara Lee Corp. | 367,321 | |||||||||
20,890 | Sysco Corp. | 638,607 | |||||||||
9,865 | Weis Markets, Inc. | 302,954 | |||||||||
9,792 | Wm. Wrigley Jr. Co. | 745,758 | |||||||||
9,684,504 | |||||||||||
Household Products/Wares—6.3% | |||||||||||
5,981 | Church & Dwight Co., Inc. | 339,840 | |||||||||
5,494 | Clorox Co. | 291,182 | |||||||||
8,993 | Kimberly-Clark Corp. | 575,463 | |||||||||
10,287 | WD-40 Co. | 320,131 | |||||||||
1,526,616 | |||||||||||
Pharmaceuticals—1.3% | |||||||||||
11,195 | NBTY, Inc.* | 315,139 | |||||||||
Retail—10.6% | |||||||||||
10,131 | BJ's Wholesale Club, Inc.* | 386,194 | |||||||||
12,764 | Casey's General Stores, Inc. | 282,467 | |||||||||
14,516 | CVS Caremark Corp. | 586,011 | |||||||||
6,657 | Longs Drug Stores Corp. | 266,679 | |||||||||
19,307 | Nu Skin Enterprises, Inc., Class A | 346,175 | |||||||||
11,820 | Wal-Mart Stores, Inc. | 685,323 | |||||||||
2,552,849 | |||||||||||
Total Common Stocks (Cost $24,209,098) | 23,988,510 | ||||||||||
Money Market Fund—0.3% | |||||||||||
64,212 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $64,212) | 64,212 | |||||||||
Total Investments (Cost $24,273,310)—99.9% | 24,052,722 | ||||||||||
Other assets less liabilities—0.1% | 18,986 | ||||||||||
Net Assets—100.0% | $ | 24,071,708 |
* Non-income producing security.
See Notes to Financial Statements.
34
Schedule of Investments
PowerShares Dynamic Energy Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Coal—5.9% | |||||||||||
13,119 | Alpha Natural Resources, Inc.* | $ | 638,239 | ||||||||
10,410 | Arch Coal, Inc. | 597,118 | |||||||||
9,206 | Foundation Coal Holdings, Inc. | 552,176 | |||||||||
13,901 | Massey Energy Co. | 727,439 | |||||||||
2,514,972 | |||||||||||
Electric - Integrated—1.4% | |||||||||||
20,253 | MDU Resources Group, Inc. | 584,704 | |||||||||
Energy - Alternate Sources—1.2% | |||||||||||
18,545 | Covanta Holding Corp.* | 493,853 | |||||||||
Gas - Distribution—11.7% | |||||||||||
15,336 | AGL Resources, Inc. | 521,424 | |||||||||
8,864 | Energen Corp. | 604,879 | |||||||||
15,574 | Laclede Group (The), Inc. | 589,009 | |||||||||
15,597 | Nicor, Inc. | 547,767 | |||||||||
18,353 | Sempra Energy | 1,040,064 | |||||||||
20,767 | UGI Corp. | 539,942 | |||||||||
20,639 | Vectren Corp. | 583,671 | |||||||||
17,052 | WGL Holdings, Inc. | 559,306 | |||||||||
4,986,062 | |||||||||||
Oil Companies - Exploration & Production—31.0% | |||||||||||
15,298 | Anadarko Petroleum Corp. | 1,018,235 | |||||||||
8,500 | Apache Corp. | 1,144,779 | |||||||||
12,937 | Berry Petroleum Co., Class A | 640,640 | |||||||||
24,772 | Bois d'Arc Energy, Inc.* | 592,051 | |||||||||
10,092 | Cimarex Energy Co. | 628,732 | |||||||||
16,678 | Denbury Resources, Inc.* | 509,680 | |||||||||
9,492 | Devon Energy Corp. | 1,076,393 | |||||||||
8,195 | EOG Resources, Inc. | 1,069,284 | |||||||||
19,180 | Mariner Energy, Inc.* | 528,601 | |||||||||
12,598 | Noble Energy, Inc. | 1,096,026 | |||||||||
12,603 | Occidental Petroleum Corp. | 1,048,696 | |||||||||
33,747 | Petroquest Energy, Inc.* | 701,263 | |||||||||
14,421 | St. Mary Land & Exploration Co. | 630,486 | |||||||||
10,478 | Stone Energy Corp.* | 638,529 | |||||||||
9,644 | Unit Corp.* | 612,490 | |||||||||
14,990 | W&T Offshore, Inc. | 613,091 | |||||||||
8,688 | Whiting Petroleum Corp.* | 664,806 | |||||||||
13,213,782 | |||||||||||
Oil Companies - Integrated—10.0% | |||||||||||
11,252 | Chevron Corp. | 1,081,880 | |||||||||
11,789 | ConocoPhillips | 1,015,622 | |||||||||
11,206 | Exxon Mobil Corp. | 1,042,942 | |||||||||
10,464 | Hess Corp. | 1,111,277 | |||||||||
4,251,721 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Oil Field Machinery & Equipment—8.6% | |||||||||||
22,954 | Cameron International Corp.* | $ | 1,130,026 | ||||||||
15,611 | Dresser-Rand Group, Inc.* | 570,894 | |||||||||
11,369 | Dril-Quip, Inc.* | 649,852 | |||||||||
9,387 | FMC Technologies, Inc.* | 630,806 | |||||||||
9,305 | Lufkin Industries, Inc. | 702,062 | |||||||||
3,683,640 | |||||||||||
Oil Refining & Marketing—0.9% | |||||||||||
8,707 | Sunoco, Inc. | 404,092 | |||||||||
Oil & Gas Drilling—9.3% | |||||||||||
16,295 | ENSCO International, Inc. | 1,038,480 | |||||||||
85,783 | Grey Wolf, Inc.* | 537,859 | |||||||||
11,864 | Helmerich & Payne, Inc. | 637,690 | |||||||||
19,839 | Noble Corp. | 1,116,540 | |||||||||
22,413 | Patterson-UTI Energy, Inc. | 626,219 | |||||||||
3,956,788 | |||||||||||
Oil - Field Services—14.6% | |||||||||||
25,459 | Halliburton Co. | 1,168,822 | |||||||||
11,837 | Hornbeck Offshore Services, Inc.* | 590,311 | |||||||||
39,368 | Key Energy Services, Inc.* | 539,342 | |||||||||
8,864 | Oceaneering International, Inc.* | 591,938 | |||||||||
12,615 | Oil States International, Inc.* | 631,507 | |||||||||
11,279 | Schlumberger Ltd. | 1,134,103 | |||||||||
5,541 | SEACOR Holdings, Inc.* | 471,595 | |||||||||
13,071 | Superior Energy Services, Inc.* | 580,091 | |||||||||
13,458 | Trico Marine Services, Inc.* | 507,232 | |||||||||
6,214,941 | |||||||||||
Pipelines—1.3% | |||||||||||
11,304 | National Fuel Gas Co. | 578,539 | |||||||||
Transport - Marine—2.9% | |||||||||||
10,499 | GulfMark Offshore, Inc.* | 627,840 | |||||||||
9,472 | Tidewater, Inc. | 617,764 | |||||||||
1,245,604 | |||||||||||
Transport - Services—1.2% | |||||||||||
10,081 | Bristow Group, Inc.* | 531,773 | |||||||||
Total Common Stocks (Cost $36,085,643) | 42,660,471 | ||||||||||
Money Market Fund—0.3% | |||||||||||
123,133 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $123,133) | 123,133 | |||||||||
Total Investments (Cost $36,208,776)—100.3% | 42,783,604 | ||||||||||
Liabilities in excess of other assets—(0.3%) | (108,780 | ) | |||||||||
Net Assets—100.0% | $ | 42,674,824 |
* Non-income producing security.
See Notes to Financial Statements.
35
Schedule of Investments
PowerShares Dynamic Financial Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.8% | |||||||||||
Commercial Banks - Central U.S.—2.8% | |||||||||||
7,315 | BancFirst Corp. | $ | 319,885 | ||||||||
7,400 | Commerce Bancshares, Inc. | 321,900 | |||||||||
641,785 | |||||||||||
Commercial Banks - Eastern U.S.—1.5% | |||||||||||
13,946 | Community Bank System, Inc. | 355,484 | |||||||||
Commercial Banks - Western U.S.—3.0% | |||||||||||
6,419 | Bank of Hawaii Corp. | 351,954 | |||||||||
6,803 | SVB Financial Group* | 331,034 | |||||||||
682,988 | |||||||||||
Data Processing/Management—1.2% | |||||||||||
12,323 | SEI Investments Co. | 286,756 | |||||||||
Fiduciary Banks—7.4% | |||||||||||
12,880 | Bank of New York Mellon (The) Corp. | 560,666 | |||||||||
8,355 | Northern Trust Corp. | 619,189 | |||||||||
7,193 | State Street Corp. | 518,903 | |||||||||
1,698,758 | |||||||||||
Finance - Credit Card—2.8% | |||||||||||
13,358 | American Express Co. | 641,451 | |||||||||
Finance - Investment Banker—10.7% | |||||||||||
28,815 | Charles Schwab (The) Corp. | 622,404 | |||||||||
6,616 | Investment Technology Group, Inc.* | 319,288 | |||||||||
19,227 | Knight Capital Group Inc., Class A | 359,737 | |||||||||
13,307 | optionsXpress Holdings, Inc. | 285,701 | |||||||||
30,877 | TD Ameritrade Holding Corp.* | 558,874 | |||||||||
32,105 | TradeStation Group, Inc.* | 299,540 | |||||||||
2,445,544 | |||||||||||
Finance - Other Services—2.0% | |||||||||||
16,116 | GfI Group, Inc. | 189,363 | |||||||||
7,425 | Nasdaq OMX (The) Group, Inc.* | 270,641 | |||||||||
460,004 | |||||||||||
Insurance Brokers—5.6% | |||||||||||
13,580 | AON Corp. | 616,396 | |||||||||
6,245 | Erie Indemnity Co., Class A | 333,608 | |||||||||
9,382 | Willis Group Holdings Ltd. | 326,025 | |||||||||
1,276,029 | |||||||||||
Investment Management/Advisory Service—4.5% | |||||||||||
11,158 | Ameriprise Financial, Inc. | 529,893 | |||||||||
7,595 | Federated Investors, Inc., Class B | 254,281 | |||||||||
5,502 | GAMCO Investors Inc., Class A | 253,147 | |||||||||
1,037,321 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Life/Health Insurance—10.5% | |||||||||||
9,054 | AFLAC, Inc. | $ | 603,631 | ||||||||
10,220 | Delphi Financial Group, Inc., Class A | 278,188 | |||||||||
7,743 | Prudential Financial, Inc. | 586,223 | |||||||||
5,633 | Reinsurance Group of America, Inc. | 292,803 | |||||||||
6,279 | StanCorp Financial Group, Inc. | 321,736 | |||||||||
5,114 | Torchmark Corp. | 331,080 | |||||||||
2,413,661 | |||||||||||
Multi-line Insurance—18.5% | |||||||||||
10,047 | ACE Ltd. | 605,733 | |||||||||
11,838 | Allstate (The) Corp. | 596,162 | |||||||||
11,914 | American Financial Group, Inc. | 326,682 | |||||||||
4,928 | Assurant, Inc. | 320,320 | |||||||||
7,054 | Hanover Insurance Group (The), Inc. | 316,584 | |||||||||
12,810 | HCC Insurance Holdings, Inc. | 316,151 | |||||||||
17,734 | Horace Mann Educators Corp. | 300,059 | |||||||||
13,505 | Loews Corp. | 568,696 | |||||||||
9,699 | MetLife, Inc. | 590,184 | |||||||||
8,973 | United Fire & Casualty Co. | 295,660 | |||||||||
4,236,231 | |||||||||||
Property/Casualty Insurances—23.9% | |||||||||||
4,501 | Arch Capital Group Ltd.* | 317,996 | |||||||||
11,101 | Chubb (The) Corp. | 588,020 | |||||||||
9,179 | Harleysville Group, Inc. | 334,575 | |||||||||
663 | Markel Corp.* | 288,007 | |||||||||
6,759 | Mercury General Corp. | 337,207 | |||||||||
11,200 | National Interstate Corp. | 254,800 | |||||||||
5,632 | Navigators Group (The), Inc.* | 275,968 | |||||||||
9,086 | Philadelphia Consolidated Holding Co.* | 335,092 | |||||||||
5,796 | ProAssurance Corp.* | 306,782 | |||||||||
5,901 | RLI Corp. | 283,248 | |||||||||
6,663 | Safeco Corp. | 444,689 | |||||||||
8,310 | Safety Insurance Group, Inc. | 298,329 | |||||||||
12,972 | Selective Insurance Group | 276,563 | |||||||||
12,175 | Travelers (The) Cos., Inc. | 613,619 | |||||||||
16,429 | United America Indemnity Ltd., Class A* | 253,992 | |||||||||
10,705 | W.R. Berkley Corp. | 275,011 | |||||||||
5,483,898 | |||||||||||
Reinsurance—5.4% | |||||||||||
11,365 | IPC Holdings Ltd. | 330,835 | |||||||||
8,519 | Odyssey Re Holdings Corp. | 304,810 | |||||||||
4,009 | PartnerRe Ltd. | 296,586 | |||||||||
4,573 | Transatlantic Holdings, Inc. | 296,559 | |||||||||
1,228,790 | |||||||||||
Total Common Stocks (Cost $23,781,062) | 22,888,700 |
See Notes to Financial Statements.
36
Schedule of Investments (Continued)
PowerShares Dynamic Financial Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Money Market Fund—0.6% | |||||||||||
151,396 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $151,396) | $ | 151,396 | ||||||||
Total Investments (Cost $23,932,458)—100.4% | 23,040,096 | ||||||||||
Liabilities in excess of other assets—(0.4%) | (96,741 | ) | |||||||||
Net Assets—100.0% | $ | 22,943,355 |
* Non-income producing security.
See Notes to Financial Statements.
37
Schedule of Investments
PowerShares Dynamic Healthcare Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Biotechnology—5.8% | |||||||||||
170,079 | Incyte Corp.* | $ | 1,845,357 | ||||||||
58,808 | Martek Biosciences Corp.* | 2,073,570 | |||||||||
120,479 | Millennium Pharmaceuticals, Inc.* | 2,996,313 | |||||||||
6,915,240 | |||||||||||
Commercial Services—3.8% | |||||||||||
104,108 | AMN Healthcare Services, Inc.* | 1,518,936 | |||||||||
96,038 | Healthspring, Inc.* | 1,617,280 | |||||||||
58,463 | PharmaNet Development Group, Inc.* | 1,394,927 | |||||||||
4,531,143 | |||||||||||
Distribution/Wholesale—1.5% | |||||||||||
39,224 | Owens & Minor, Inc. | 1,777,632 | |||||||||
Electronics—10.9% | |||||||||||
28,807 | Analogic Corp. | 1,658,995 | |||||||||
50,000 | Applera Corp. - Applied Biosystems Group | 1,595,500 | |||||||||
22,833 | Dionex Corp.* | 1,785,997 | |||||||||
55,249 | Thermo Fisher Scientific, Inc.* | 3,197,261 | |||||||||
31,126 | Varian, Inc.* | 1,585,247 | |||||||||
51,838 | Waters Corp.* | 3,185,963 | |||||||||
13,008,963 | |||||||||||
Healthcare - Products—24.5% | |||||||||||
52,357 | Baxter International, Inc. | 3,262,888 | |||||||||
24,970 | Beckman Coulter, Inc. | 1,705,451 | |||||||||
34,174 | Becton, Dickinson & Co. | 3,055,156 | |||||||||
32,599 | C.R. Bard, Inc. | 3,069,848 | |||||||||
62,519 | Conmed Corp.* | 1,595,485 | |||||||||
48,433 | Datascope Corp. | 1,814,300 | |||||||||
38,649 | Edwards Lifesciences Corp.* | 2,141,928 | |||||||||
35,254 | Gen-Probe, Inc.* | 1,986,915 | |||||||||
29,010 | Haemonetics Corp.* | 1,660,242 | |||||||||
28,175 | Henry Schein, Inc.* | 1,560,050 | |||||||||
67,528 | Invacare Corp. | 1,218,205 | |||||||||
32,798 | Kinetic Concepts, Inc.* | 1,300,769 | |||||||||
49,183 | Meridian Bioscience, Inc. | 1,324,498 | |||||||||
47,883 | Patterson Cos., Inc.* | 1,637,599 | |||||||||
24,645 | Techne Corp.* | 1,787,255 | |||||||||
29,120,589 | |||||||||||
Healthcare - Services—29.0% | |||||||||||
62,300 | Aetna, Inc. | 2,716,279 | |||||||||
40,990 | Air Methods Corp.* | 1,643,699 | |||||||||
39,397 | Amedisys, Inc.* | 2,040,765 | |||||||||
46,819 | AMERIGROUP Corp.* | 1,216,826 | |||||||||
94,055 | Centene Corp.* | 1,727,790 | |||||||||
69,315 | CIGNA Corp. | 2,960,443 | |||||||||
59,574 | Coventry Health Care, Inc.* | 2,664,744 | |||||||||
78,175 | Gentiva Health Services, Inc.* | 1,699,525 | |||||||||
38,359 | Health Net, Inc.* | 1,123,535 | |||||||||
45,223 | Humana, Inc.* | 2,161,207 | |||||||||
51,862 | Lincare Holdings, Inc.* | 1,262,321 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
38,898 | Magellan Health Services, Inc.* | $ | 1,501,074 | ||||||||
53,253 | Molina Healthcare, Inc.* | 1,322,272 | |||||||||
25,534 | Pediatrix Medical Group, Inc.* | 1,736,823 | |||||||||
78,250 | Res-Care, Inc.* | 1,274,693 | |||||||||
83,440 | Triple-S Management Corp., Class B* | 1,521,946 | |||||||||
66,482 | UnitedHealth Group, Inc. | 2,169,308 | |||||||||
35,304 | WellCare Health Plans, Inc.* | 1,545,609 | |||||||||
44,092 | WellPoint, Inc.* | 2,193,577 | |||||||||
34,482,436 | |||||||||||
Internet—1.4% | |||||||||||
140,926 | eResearch Technology, Inc.* | 1,716,479 | |||||||||
Pharmaceuticals—23.1% | |||||||||||
57,705 | Abbott Laboratories | 3,043,939 | |||||||||
74,067 | AmerisourceBergen Corp. | 3,003,417 | |||||||||
27,933 | Cephalon, Inc.* | 1,743,299 | |||||||||
64,185 | Endo Pharmaceuticals Holdings, Inc.* | 1,593,714 | |||||||||
52,284 | Express Scripts, Inc.* | 3,660,925 | |||||||||
77,699 | Forest Laboratories, Inc.* | 2,696,932 | |||||||||
82,177 | Medicis Pharmaceutical Corp., Class A | 1,692,846 | |||||||||
46,885 | OSI Pharmaceuticals, Inc.* | 1,624,565 | |||||||||
50,434 | Perrigo Co. | 2,067,290 | |||||||||
138,692 | Pfizer, Inc. | 2,789,096 | |||||||||
99,911 | Warner Chilcott Ltd., Class A* | 1,719,468 | |||||||||
60,606 | Watson Pharmaceuticals, Inc.* | 1,881,210 | |||||||||
27,516,701 | |||||||||||
Total Investments (Cost $128,760,124)—100.0% | 119,069,183 | ||||||||||
Liabilities in excess of other assets—(0.0%) | (49,900 | ) | |||||||||
Net Assets—100.0% | $ | 119,019,283 |
* Non-income producing security.
See Notes to Financial Statements.
38
Schedule of Investments
PowerShares Dynamic Industrials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.2% | |||||||||||
Aerospace/Defense—22.1% | |||||||||||
4,420 | Alliant Techsystems, Inc.* | $ | 486,112 | ||||||||
13,521 | BE Aerospace, Inc.* | 545,708 | |||||||||
8,268 | DRS Technologies, Inc. | 516,254 | |||||||||
10,387 | General Dynamics Corp. | 939,193 | |||||||||
14,355 | Goodrich Corp. | 978,292 | |||||||||
8,000 | L-3 Communications Holdings, Inc. | 891,600 | |||||||||
8,239 | Lockheed Martin Corp. | 873,664 | |||||||||
10,816 | Northrop Grumman Corp. | 795,733 | |||||||||
21,420 | Orbital Sciences Corp.* | 576,412 | |||||||||
13,112 | Raytheon Co. | 838,775 | |||||||||
10,445 | Teledyne Technologies, Inc.* | 613,435 | |||||||||
8,055,178 | |||||||||||
Commercial Services—10.7% | |||||||||||
52,108 | Cbiz, Inc.* | 462,198 | |||||||||
12,211 | CRA International, Inc.* | 421,035 | |||||||||
15,937 | Exponent Inc.* | 537,714 | |||||||||
27,509 | Korn/Ferry International* | 513,318 | |||||||||
8,180 | Manpower, Inc. | 549,124 | |||||||||
17,208 | Robert Half International, Inc. | 407,830 | |||||||||
37,132 | TrueBlue, Inc.* | 472,690 | |||||||||
8,741 | Watson Wyatt Worldwide, Inc. | 512,397 | |||||||||
3,876,306 | |||||||||||
Electric—1.6% | |||||||||||
35,867 | Pike Electric Corp.* | 575,307 | |||||||||
Electrical Components & Equipment—2.8% | |||||||||||
28,949 | GrafTech International Ltd.* | 568,848 | |||||||||
10,223 | Hubbell, Inc., Class B | 457,275 | |||||||||
1,026,123 | |||||||||||
Electronics—1.5% | |||||||||||
14,166 | II-VI, Inc.* | 526,125 | |||||||||
Engineering & Construction—9.9% | |||||||||||
6,105 | Fluor Corp. | 933,272 | |||||||||
10,589 | Jacobs Engineering Group, Inc.* | 914,148 | |||||||||
13,916 | KBR, Inc. | 401,337 | |||||||||
16,283 | McDermott International, Inc.* | 872,443 | |||||||||
11,514 | URS Corp.* | 464,475 | |||||||||
3,585,675 | |||||||||||
Environmental Control—3.7% | |||||||||||
27,848 | Republic Services, Inc. | 885,288 | |||||||||
12,676 | Waste Industries USA, Inc. | 478,519 | |||||||||
1,363,807 | |||||||||||
Hand/Machine Tools—1.5% | |||||||||||
6,908 | Lincoln Electric Holdings, Inc. | 527,080 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Machinery - Diversified—8.7% | |||||||||||
13,110 | AGCO Corp.* | $ | 788,304 | ||||||||
16,778 | Applied Industrial Technologies, Inc. | 405,356 | |||||||||
16,193 | Columbus McKinnon Corp.* | 458,424 | |||||||||
12,564 | Gardner Denver, Inc.* | 583,598 | |||||||||
11,383 | Manitowoc (The) Co., Inc. | 430,505 | |||||||||
8,222 | Roper Industries, Inc. | 510,751 | |||||||||
3,176,938 | |||||||||||
Metal Fabricate/Hardware—2.5% | |||||||||||
8,137 | Dynamic Materials Corp. | 382,683 | |||||||||
16,142 | Mueller Industries, Inc. | 522,517 | |||||||||
905,200 | |||||||||||
Miscellaneous Manufacturing—17.4% | |||||||||||
6,930 | Brink's (The) Co. | 504,158 | |||||||||
20,277 | Cooper Industries Ltd., Class A | 859,542 | |||||||||
11,248 | Crane Co. | 460,493 | |||||||||
10,999 | Donaldson Co., Inc. | 478,896 | |||||||||
20,482 | Dover Corp. | 1,013,245 | |||||||||
10,544 | Eaton Corp. | 926,185 | |||||||||
13,157 | Parker Hannifin Corp. | 1,050,586 | |||||||||
15,840 | Raven Industries, Inc. | 485,338 | |||||||||
4,532 | SPX Corp. | 557,436 | |||||||||
6,335,879 | |||||||||||
Retail—2.6% | |||||||||||
11,130 | Copart, Inc.* | 454,883 | |||||||||
31,294 | Rush Enterprises, Inc., Class A* | 504,459 | |||||||||
959,342 | |||||||||||
Telecommunications—1.0% | |||||||||||
15,349 | GeoEye, Inc.* | 353,487 | |||||||||
Textiles—1.3% | |||||||||||
16,115 | Cintas Corp. | 477,165 | |||||||||
Transportation—12.9% | |||||||||||
9,167 | Atlas Air Worldwide Holdings Inc.* | 556,254 | |||||||||
15,464 | HUB Group, Inc., Class A* | 505,518 | |||||||||
16,944 | J.B. Hunt Transport Services, Inc. | 575,588 | |||||||||
10,288 | Kirby Corp.* | 564,194 | |||||||||
9,999 | Landstar System, Inc. | 519,548 | |||||||||
16,077 | Norfolk Southern Corp. | 957,867 | |||||||||
17,020 | Old Dominion Freight Line, Inc.* | 522,514 | |||||||||
26,069 | Werner Enterprises, Inc. | 507,042 | |||||||||
4,708,525 | |||||||||||
Total Common Stocks (Cost $35,933,217) | 36,452,137 |
See Notes to Financial Statements.
39
Schedule of Investments (Continued)
PowerShares Dynamic Industrials Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Money Market Fund—0.4% | |||||||||||
154,694 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $154,694) | $ | 154,694 | ||||||||
Total Investments (Cost $36,087,911)—100.6% | 36,606,831 | ||||||||||
Liabilities in excess of other assets—(0.6%) | (210,252 | ) | |||||||||
Net Assets—100.0% | $ | 36,396,579 |
* Non-income producing security.
See Notes to Financial Statements.
40
Schedule of Investments
PowerShares Dynamic Technology Sector Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Commercial Services—5.4% | |||||||||||
32,851 | Convergys Corp.* | $ | 516,418 | ||||||||
11,958 | Global Payments, Inc. | 529,261 | |||||||||
12,022 | Hewitt Associates, Inc., Class A* | 492,902 | |||||||||
24,888 | SAIC, Inc.* | 472,872 | |||||||||
2,011,453 | |||||||||||
Computers—24.8% | |||||||||||
19,505 | Ansoft Corp.* | 646,786 | |||||||||
6,956 | Apple, Inc.* | 1,209,996 | |||||||||
61,686 | Brocade Communications Systems, Inc.* | 441,672 | |||||||||
44,667 | Cadence Design Systems, Inc.* | 497,144 | |||||||||
20,016 | Computer Sciences Corp.* | 872,497 | |||||||||
6,752 | DST Systems, Inc.* | 404,040 | |||||||||
18,205 | Hewlett-Packard Co. | 843,802 | |||||||||
7,638 | International Business Machines Corp. | 921,907 | |||||||||
14,362 | Lexmark International, Inc., Class A* | 450,823 | |||||||||
14,806 | Micros Systems, Inc.* | 527,834 | |||||||||
21,407 | NCR Corp.* | 527,254 | |||||||||
40,226 | NetApp, Inc.* | 973,469 | |||||||||
71,441 | Smart Modular Technologies WWH, Inc.* | 430,789 | |||||||||
20,438 | Synopsys, Inc.* | 472,322 | |||||||||
9,220,335 | |||||||||||
Electronics—10.2% | |||||||||||
23,524 | Amphenol Corp., Class A | 1,086,337 | |||||||||
14,547 | Arrow Electronics, Inc.* | 395,824 | |||||||||
10,720 | Dolby Laboratories, Inc., Class A* | 430,408 | |||||||||
4,856 | Mettler-Toledo International, Inc.* | 462,583 | |||||||||
19,151 | Plexus Corp.* | 461,348 | |||||||||
12,049 | Rofin-Sinar Technologies, Inc.* | 458,826 | |||||||||
14,974 | Rogers Corp.* | 512,710 | |||||||||
3,808,036 | |||||||||||
Internet—3.6% | |||||||||||
65,611 | EarthLink, Inc.* | 599,028 | |||||||||
10,523 | Sohu.com, Inc.* | 727,455 | |||||||||
1,326,483 | |||||||||||
Machinery - Diversified—1.4% | |||||||||||
14,237 | Zebra Technologies Corp., Class A* | 523,210 | |||||||||
Semiconductors—23.2% | |||||||||||
40,510 | Amkor Technology, Inc.* | 386,871 | |||||||||
14,165 | Cabot Microelectronics Corp.* | 482,318 | |||||||||
31,880 | Emulex Corp.* | 417,309 | |||||||||
43,593 | Intel Corp. | 970,380 | |||||||||
11,401 | MEMC Electronic Materials, Inc.* | 717,921 | |||||||||
64,540 | Micrel, Inc. | 633,783 | |||||||||
28,802 | National Semiconductor Corp. | 587,273 | |||||||||
21,484 | Novellus Systems, Inc.* | 469,640 | |||||||||
29,929 | QLogic Corp.* | 477,667 | |||||||||
37,235 | Semtech Corp.* | 604,696 | |||||||||
15,327 | Silicon Laboratories, Inc.* | 517,593 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
16,732 | Standard Microsystems Corp.* | $ | 496,104 | ||||||||
39,564 | Teradyne, Inc.* | 525,806 | |||||||||
29,028 | Texas Instruments, Inc. | 846,456 | |||||||||
23,600 | Verigy Ltd. (Singapore)* | 504,332 | |||||||||
8,638,149 | |||||||||||
Software—19.1% | |||||||||||
37,322 | Acxiom Corp. | 441,519 | |||||||||
25,845 | Adobe Systems, Inc.* | 963,760 | |||||||||
12,694 | Ansys, Inc.* | 510,680 | |||||||||
26,942 | BMC Software, Inc.* | 936,504 | |||||||||
38,010 | CA, Inc. | 841,541 | |||||||||
31,950 | Microsoft Corp. | 911,214 | |||||||||
46,260 | Oracle Corp.* | 964,521 | |||||||||
16,621 | Progress Software Corp.* | 502,453 | |||||||||
12,474 | SPSS, Inc.* | 526,902 | |||||||||
17,820 | Sybase, Inc.* | 524,264 | |||||||||
7,123,358 | |||||||||||
Telecommunications—12.3% | |||||||||||
25,753 | Adtran, Inc. | 609,316 | |||||||||
35,686 | Cisco Systems, Inc.* | 914,989 | |||||||||
11,327 | CommScope, Inc.* | 538,599 | |||||||||
10,935 | Comtech Telecommunications Corp.* | 423,513 | |||||||||
17,810 | Harris Corp. | 962,274 | |||||||||
18,487 | NeuStar, Inc., Class A* | 508,577 | |||||||||
25,152 | Plantronics, Inc. | 626,536 | |||||||||
4,583,804 | |||||||||||
Total Investments (Cost $37,053,734)—100.0% | 37,234,828 | ||||||||||
Liabilities in excess of other assets—0.0% | 10,718 | ||||||||||
Net Assets—100.0% | $ | 37,245,546 |
* Non-income producing security.
See Notes to Financial Statements.
41
Schedule of Investments
PowerShares Dynamic Telecommunications & Wireless Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—99.6% | |||||||||||
Broadcast Services/Program—4.6% | |||||||||||
24,091 | Liberty Global, Inc., Class A* | $ | 852,580 | ||||||||
Cable TV—17.7% | |||||||||||
46,358 | Comcast Corp., Class A | 952,658 | |||||||||
36,160 | DIRECTV Group (The), Inc.* | 890,982 | |||||||||
30,550 | DISH Network Corp., Class A* | 911,612 | |||||||||
113,063 | Mediacom Communications Corp., Class A* | 485,040 | |||||||||
3,240,292 | |||||||||||
Cellular Telecommications—4.9% | |||||||||||
29,150 | Syniverse Holdings, Inc.* | 457,947 | |||||||||
7,843 | United States Cellular Corp.* | 432,541 | |||||||||
890,488 | |||||||||||
Electronic Components - Miscellaneous—3.4% | |||||||||||
15,429 | Garmin Ltd. | 631,046 | |||||||||
Electronic Measuring Instruments—3.2% | |||||||||||
18,072 | Trimble Navigation Ltd.* | 592,581 | |||||||||
Networking Products—5.2% | |||||||||||
37,169 | Cisco Systems, Inc.* | 953,013 | |||||||||
Telecommunication Equipment—9.0% | |||||||||||
11,389 | Comtech Telecommunications Corp.* | 441,096 | |||||||||
10,118 | Harris Corp. | 546,676 | |||||||||
26,198 | Plantronics, Inc. | 652,592 | |||||||||
1,640,364 | |||||||||||
Telecommunication Services—8.3% | |||||||||||
11,781 | Embarq Corp. | 489,736 | |||||||||
23,164 | NTELOS Holdings Corp. | 599,485 | |||||||||
32,939 | Virgin Media, Inc. | 424,913 | |||||||||
1,514,134 | |||||||||||
Telephone - Integrated—31.9% | |||||||||||
43,609 | Alaska Communications Systems Group, Inc. | 487,549 | |||||||||
26,007 | AT&T, Inc. | 1,006,730 | |||||||||
16,068 | Atlantic Tele-Network, Inc. | 500,197 | |||||||||
13,653 | CenturyTel, Inc. | 443,040 | |||||||||
127,342 | Cincinnati Bell, Inc.* | 590,867 | |||||||||
46,004 | Citizens Communications Co. | 493,163 | |||||||||
91,497 | Qwest Communications International, Inc. | 472,125 | |||||||||
10,535 | Telephone & Data Systems, Inc. | 403,491 | |||||||||
24,940 | Verizon Communications, Inc. | 959,690 | |||||||||
42,015 | Windstream Corp. | 493,256 | |||||||||
5,850,108 | |||||||||||
Web Portals/ISP—6.3% | |||||||||||
68,338 | Earthlink, Inc.* | 623,926 | |||||||||
49,507 | United Online, Inc. | 528,735 | |||||||||
1,152,661 |
Number of Shares | Value | ||||||||||
Common Stocks (Continued) | |||||||||||
Wireless Equipment—5.1% | |||||||||||
46,700 | Novatel Wireless, Inc.* | $ | 416,564 | ||||||||
23,562 | Viasat, Inc.* | 520,720 | |||||||||
937,284 | |||||||||||
Total Common Stocks (Cost $19,515,537) | 18,254,551 | ||||||||||
Money Market Fund—1.4% | |||||||||||
255,207 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $255,207) | 255,207 | |||||||||
Total Investments (Cost $19,770,744)—101.0% | 18,509,758 | ||||||||||
Liabilities in excess of other assets—(1.0%) | (190,182 | ) | |||||||||
Net Assets—100.0% | $ | 18,319,576 |
* Non-income producing security.
See Notes to Financial Statements.
42
Schedule of Investments
PowerShares Dynamic Utilities Portfolio
April 30, 2008
Number of Shares | Value | ||||||||||
Common Stocks—100.0% | |||||||||||
Electric - Integrated—65.2% | |||||||||||
29,419 | Alliant Energy Corp. | $ | 1,108,214 | ||||||||
28,580 | Black Hills Corp. | 1,114,906 | |||||||||
46,914 | Dominion Resources, Inc. | 2,035,597 | |||||||||
25,673 | DTE Energy Co. | 1,034,879 | |||||||||
106,826 | Duke Energy Corp. | 1,955,984 | |||||||||
37,930 | Edison International | 1,978,808 | |||||||||
27,722 | FirstEnergy Corp. | 2,096,891 | |||||||||
45,504 | Hawaiian Electric Industries, Inc. | 1,121,674 | |||||||||
33,075 | NSTAR | 1,065,346 | |||||||||
40,445 | Pepco Holdings, Inc. | 1,007,485 | |||||||||
49,754 | PG&E Corp. | 1,990,160 | |||||||||
43,808 | Portland General Electric Co. | 1,051,392 | |||||||||
41,290 | PPL Corp. | 1,982,746 | |||||||||
42,488 | Public Service Enterprise Group, Inc. | 1,865,648 | |||||||||
26,988 | SCANA Corp. | 1,064,137 | |||||||||
68,226 | TECO Energy, Inc. | 1,092,298 | |||||||||
43,215 | Unisource Energy Corp. | 1,350,037 | |||||||||
23,430 | Wisconsin Energy Corp. | 1,111,988 | |||||||||
26,028,190 | |||||||||||
Energy - Alternate Sources—2.4% | |||||||||||
35,636 | Covanta Holding Corp.* | 948,987 | |||||||||
Gas - Distribution—21.1% | |||||||||||
29,470 | AGL Resources, Inc. | 1,001,980 | |||||||||
29,928 | Laclede Group (The), Inc. | 1,131,877 | |||||||||
33,320 | New Jersey Resources Corp. | 1,061,242 | |||||||||
29,972 | Nicor, Inc. | 1,052,617 | |||||||||
35,267 | Sempra Energy | 1,998,580 | |||||||||
39,660 | Vectren Corp. | 1,121,585 | |||||||||
32,768 | WGL Holdings, Inc. | 1,074,790 | |||||||||
8,442,671 | |||||||||||
Independent Power Producer—8.5% | |||||||||||
27,623 | Mirant Corp.* | 1,135,582 | |||||||||
24,765 | NRG Energy, Inc.* | 1,088,422 | |||||||||
44,826 | Reliant Energy, Inc.* | 1,153,821 | |||||||||
3,377,825 | |||||||||||
Pipelines—2.8% | |||||||||||
21,722 | National Fuel Gas Co. | 1,111,732 | |||||||||
Total Common Stocks (Cost $38,830,249) | 39,909,405 |
Number of Shares | Value | ||||||||||
Money Market Fund—0.6% | |||||||||||
252,056 | Goldman Sachs Financial Square Prime Obligations Institutional Share Class (Cost $252,056) | $ | 252,056 | ||||||||
Total Investments (Cost $39,082,305)—100.6% | 40,161,461 | ||||||||||
Liabilities in excess of other assets—(0.6%) | (232,409 | ) | |||||||||
Net Assets—100.0% | $ | 39,929,052 |
* Non-income producing security.
See Notes to Financial Statements.
43
Statements of Assets and Liabilities
PowerShares Exchange-Traded Funds
April 30, 2008
PowerShares Dynamic Basic Materials Sector Portfolio | PowerShares Dynamic Consumer Discretionary Sector Portfolio | PowerShares Dynamic Consumer Staples Sector Portfolio | PowerShares Dynamic Energy Sector Portfolio | PowerShares Dynamic Financial Sector Portfolio | |||||||||||||||||||
ASSETS: | |||||||||||||||||||||||
Investments at value | $ | 43,791,617 | $ | 11,272,248 | $ | 24,052,722 | $ | 42,783,604 | $ | 23,040,096 | |||||||||||||
Cash | — | — | 47,320 | — | — | ||||||||||||||||||
Receivables: | |||||||||||||||||||||||
Dividends | 39,303 | 7,633 | 26,266 | 30,265 | 10,716 | ||||||||||||||||||
Shares sold | — | — | — | — | — | ||||||||||||||||||
Expense waivers due from Adviser | 4,439 | — | 2,059 | 2,385 | — | ||||||||||||||||||
Total Assets | 43,835,359 | 11,279,881 | 24,128,367 | 42,816,254 | 23,050,812 | ||||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||
Due to custodian | 217,092 | 3,058 | — | 74,558 | 51,219 | ||||||||||||||||||
Payables: | |||||||||||||||||||||||
Investments purchased | — | — | — | — | — | ||||||||||||||||||
Expense recapture due to Adviser | — | 891 | — | — | 356 | ||||||||||||||||||
Accrued advisory fees | 17,168 | 4,584 | 9,897 | 17,115 | 9,365 | ||||||||||||||||||
Accrued expenses | 51,078 | 44,390 | 46,762 | 49,757 | 46,517 | ||||||||||||||||||
Total Liabilities | 285,338 | 52,923 | 56,659 | 141,430 | 107,457 | ||||||||||||||||||
NET ASSETS | $ | 43,550,021 | $ | 11,226,958 | $ | 24,071,708 | $ | 42,674,824 | $ | 22,943,355 | |||||||||||||
NET ASSETS CONSIST OF: | |||||||||||||||||||||||
Shares of beneficial interest | $ | 41,639,214 | $ | 13,780,204 | $ | 25,811,462 | $ | 38,349,232 | $ | 25,070,234 | |||||||||||||
Undistributed net investment income (loss) | 96,459 | — | 32,020 | 51,637 | 54,347 | ||||||||||||||||||
Accumulated net realized loss on investments | (2,100,022 | ) | (2,191,952 | ) | (1,551,186 | ) | (2,300,873 | ) | (1,288,864 | ) | |||||||||||||
Net unrealized appreciation (depreciation) on investments | 3,914,370 | (361,294 | ) | (220,588 | ) | 6,574,828 | (892,362 | ) | |||||||||||||||
Net Assets | $ | 43,550,021 | $ | 11,226,958 | $ | 24,071,708 | $ | 42,674,824 | $ | 22,943,355 | |||||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 1,200,000 | 500,000 | 900,000 | 1,100,000 | 1,000,000 | ||||||||||||||||||
Net asset value | $ | 36.29 | $ | 22.45 | $ | 26.75 | $ | 38.80 | $ | 22.94 | |||||||||||||
Investments at cost | $ | 39,877,247 | $ | 11,633,542 | $ | 24,273,310 | $ | 36,208,776 | $ | 23,932,458 |
See Notes to Financial Statements.
44
PowerShares Dynamic Healthcare Sector Portfolio | PowerShares Dynamic Industrials Sector Portfolio | PowerShares Dynamic Technology Sector Portfolio | PowerShares Dynamic Telecommunications & Wireless Portfolio | PowerShares Dynamic Utilities Portfolio | |||||||||||||||||||
ASSETS: | |||||||||||||||||||||||
Investments at value | $ | 119,069,183 | $ | 36,606,831 | $ | 37,234,828 | $ | 18,509,758 | $ | 40,161,461 | |||||||||||||
Cash | 20,370 | — | 67,303 | — | — | ||||||||||||||||||
Receivables: | |||||||||||||||||||||||
Dividends | 32,549 | 8,703 | 5,221 | 21,640 | 47,917 | ||||||||||||||||||
Shares sold | — | 3,043,271 | — | — | — | ||||||||||||||||||
Expense waivers due from Adviser | 8,237 | 1,916 | 3,877 | 14,363 | 6,678 | ||||||||||||||||||
Total Assets | 119,130,339 | 39,660,721 | 37,311,229 | 18,545,761 | 40,216,056 | ||||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||
Due to custodian | — | 162,397 | — | 178,597 | 231,407 | ||||||||||||||||||
Payables: | |||||||||||||||||||||||
Investments purchased | — | 3,043,476 | — | — | — | ||||||||||||||||||
Expense recapture due to Adviser | — | — | — | — | — | ||||||||||||||||||
Accrued advisory fees | 47,946 | 11,657 | 14,886 | 7,405 | 16,112 | ||||||||||||||||||
Accrued expenses | 63,110 | 46,612 | 50,797 | 40,183 | 39,485 | ||||||||||||||||||
Total Liabilities | 111,056 | 3,264,142 | 65,683 | 226,185 | 287,004 | ||||||||||||||||||
NET ASSETS | $ | 119,019,283 | $ | 36,396,579 | $ | 37,245,546 | $ | 18,319,576 | $ | 39,929,052 | |||||||||||||
NET ASSETS CONSIST OF: | |||||||||||||||||||||||
Shares of beneficial interest | $ | 138,401,487 | $ | 40,745,017 | $ | 44,353,548 | $ | 25,627,386 | $ | 41,621,425 | |||||||||||||
Undistributed net investment income (loss) | — | 11,088 | — | — | 185,518 | ||||||||||||||||||
Accumulated net realized loss on investments | (9,691,263 | ) | (4,878,446 | ) | (7,289,096 | ) | (6,046,824 | ) | (2,957,047 | ) | |||||||||||||
Net unrealized appreciation (depreciation) on investments | (9,690,941 | ) | 518,920 | 181,094 | (1,260,986 | ) | 1,079,156 | ||||||||||||||||
Net Assets | $ | 119,019,283 | $ | 36,396,579 | $ | 37,245,546 | $ | 18,319,576 | $ | 39,929,052 | |||||||||||||
Shares outstanding (unlimited amount authorized, $0.01 par value) | 4,600,000 | 1,200,000 | 1,500,000 | 1,200,000 | 2,100,000 | ||||||||||||||||||
Net asset value | $ | 25.87 | $ | 30.33 | $ | 24.83 | $ | 15.27 | $ | 19.01 | |||||||||||||
Investments at cost | $ | 128,760,124 | $ | 36,087,911 | $ | 37,053,734 | $ | 19,770,744 | $ | 39,082,305 |
45
Statements of Operations
Year Ended April 30, 2008
PowerShares Dynamic Basic Materials Sector Portfolio | PowerShares Dynamic Consumer Discretionary Sector Portfolio | PowerShares Dynamic Consumer Staples Sector Portfolio | PowerShares Dynamic Energy Sector Portfolio | PowerShares Dynamic Financial Sector Portfolio | |||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||
Unaffiliated dividend income | $ | 522,599 | $ | 169,047 | $ | 381,142 | $ | 356,279 | $ | 250,477 | |||||||||||||
Affiliated money market dividend income | 2,565 | 1,245 | 889 | 2,487 | 2,026 | ||||||||||||||||||
Total Income | 525,164 | 170,292 | 382,031 | 358,766 | 252,503 | ||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||
Advisory fees | 161,486 | 80,226 | 99,874 | 163,545 | 70,669 | ||||||||||||||||||
Administration & Accounting fees | 75,102 | 75,090 | 75,133 | 75,058 | 75,138 | ||||||||||||||||||
Sub-licensing | 16,149 | 8,023 | 9,987 | 16,355 | 7,067 | ||||||||||||||||||
Audit | 15,848 | 15,848 | 15,849 | 15,848 | 15,848 | ||||||||||||||||||
Professional tax review | 10,464 | 10,464 | 10,464 | 10,464 | 10,464 | ||||||||||||||||||
Printing | 9,467 | 348 | 3,318 | 7,751 | 890 | ||||||||||||||||||
Offering costs | 8,494 | 8,626 | 8,409 | 10,786 | 9,563 | ||||||||||||||||||
Custodian & transfer agent fees | 6,111 | 6,109 | 6,118 | 6,102 | 6,118 | ||||||||||||||||||
Trustees | 5,155 | 4,984 | 4,915 | 5,262 | 4,781 | ||||||||||||||||||
Registration & filings | 603 | 84 | 348 | 430 | 207 | ||||||||||||||||||
Legal | — | — | — | — | — | ||||||||||||||||||
Listing fee and expenses | 28 | 32 | 17 | 34 | 14 | ||||||||||||||||||
Other expenses | 872 | 789 | 518 | 880 | 366 | ||||||||||||||||||
Total Expenses | 309,779 | 210,623 | 234,950 | 312,515 | 201,125 | ||||||||||||||||||
(Waivers) and/or Recapture | (91,354 | ) | (97,703 | ) | (96,704 | ) | (89,121 | ) | (99,693 | ) | |||||||||||||
Net Expenses | 218,425 | 112,920 | 138,246 | 223,394 | 101,432 | ||||||||||||||||||
Net Investment Income (Loss) | 306,739 | 57,372 | 243,785 | 135,372 | 151,071 | ||||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||||||||||
Net realized gain (loss) from: | |||||||||||||||||||||||
Investments | (2,085,719 | ) | (1,894,952 | ) | (1,388,531 | ) | (2,092,325 | ) | (1,016,494 | ) | |||||||||||||
In-kind redemptions | 3,826,944 | (1,383,400 | ) | 1,336,374 | 4,898,027 | 356,599 | |||||||||||||||||
Net realized gain (loss) | 1,741,225 | (3,278,352 | ) | (52,157 | ) | 2,805,702 | (659,895 | ) | |||||||||||||||
Net change in unrealized appreciation/(depreciation) on investments | 1,959,923 | (1,171,467 | ) | (985,452 | ) | 3,251,353 | (1,332,472 | ) | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 3,701,148 | (4,449,819 | ) | (1,037,609 | ) | 6,057,055 | (1,992,367 | ) | |||||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | 4,007,887 | $ | (4,392,447 | ) | $ | (793,824 | ) | $ | 6,192,427 | $ | (1,841,296 | ) |
See Notes to Financial Statements.
46
PowerShares Dynamic Healthcare Sector Portfolio | PowerShares Dynamic Industrials Sector Portfolio | PowerShares Dynamic Technology Sector Portfolio | PowerShares Dynamic Telecommunications & Wireless Portfolio | PowerShares Dynamic Utilities Portfolio | |||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||
Unaffiliated dividend income | $ | 457,361 | $ | 434,429 | $ | 109,480 | $ | 459,595 | $ | 1,229,924 | |||||||||||||
Affiliated money market dividend income | 143 | 1,619 | — | 6,018 | 1,130 | ||||||||||||||||||
Total Income | 457,504 | 436,048 | 109,480 | 465,613 | 1,231,054 | ||||||||||||||||||
EXPENSES: | |||||||||||||||||||||||
Advisory fees | 468,210 | 193,324 | 170,545 | 148,732 | 208,608 | ||||||||||||||||||
Administration & Accounting fees | 75,111 | 75,026 | 75,074 | 80,738 | 80,738 | ||||||||||||||||||
Sub-licensing | 46,821 | 19,332 | 17,055 | 8,924 | 12,516 | ||||||||||||||||||
Audit | 15,848 | 15,848 | 15,848 | 15,848 | 15,848 | ||||||||||||||||||
Professional tax review | 10,464 | 10,464 | 10,464 | 10,821 | 11,072 | ||||||||||||||||||
Printing | 27,219 | 10,382 | 9,146 | 10,326 | 5,593 | ||||||||||||||||||
Offering costs | 11,225 | 11,951 | 9,866 | — | — | ||||||||||||||||||
Custodian & transfer agent fees | 7,423 | 6,096 | 6,106 | 6,460 | 6,553 | ||||||||||||||||||
Trustees | 6,439 | 5,464 | 5,325 | 5,385 | 5,636 | ||||||||||||||||||
Registration & filings | 3,042 | 124 | 635 | — | — | ||||||||||||||||||
Legal | — | — | — | 1,440 | 1,672 | ||||||||||||||||||
Listing fee and expenses | 93 | 41 | 42 | 9,572 | 6,824 | ||||||||||||||||||
Other expenses | 2,630 | 1,213 | 1,021 | 1,546 | 3,811 | ||||||||||||||||||
Total Expenses | 674,525 | 349,265 | 321,127 | 299,792 | 358,871 | ||||||||||||||||||
(Waivers) and/or Recapture | (54,628 | ) | (85,993 | ) | (89,552 | ) | (112,390 | ) | (96,025 | ) | |||||||||||||
Net Expenses | 619,897 | 263,272 | 231,575 | 187,402 | 262,846 | ||||||||||||||||||
Net Investment Income (Loss) | (162,393 | ) | 172,776 | (122,095 | ) | 278,211 | 968,208 | ||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | |||||||||||||||||||||||
Net realized gain (loss) from: | |||||||||||||||||||||||
Investments | (9,443,562 | ) | (4,683,570 | ) | (6,754,333 | ) | (4,265,917 | ) | (2,055,367 | ) | |||||||||||||
In-kind redemptions | 5,116,230 | 5,617,928 | 3,866,099 | 3,464,530 | 3,306,991 | ||||||||||||||||||
Net realized gain (loss) | (4,327,332 | ) | 934,358 | (2,888,234 | ) | (801,387 | ) | 1,251,624 | |||||||||||||||
Net change in unrealized appreciation/(depreciation) on investments | (10,832,188 | ) | (1,455,235 | ) | (1,461,170 | ) | (5,689,699 | ) | (5,229,214 | ) | |||||||||||||
Net realized and unrealized gain (loss) on investments | (15,159,520 | ) | (520,877 | ) | (4,349,404 | ) | (6,491,086 | ) | (3,977,590 | ) | |||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | (15,321,913 | ) | $ | (348,101 | ) | $ | (4,471,499 | ) | $ | (6,212,875 | ) | $ | (3,009,382 | ) |
47
Statements of Changes in Net Assets
PowerShares Dynamic Basic Materials Sector Portfolio | PowerShares Dynamic Consumer Discretionary Sector Portfolio | PowerShares Dynamic Consumer Staples Sector Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income | $ | 306,739 | $ | 120,727 | $ | 57,372 | $ | 46,399 | $ | 243,785 | $ | 228,759 | |||||||||||||||
Net realized gain (loss) on investments | 1,741,225 | 1,065,296 | (3,278,352 | ) | 866,240 | (52,157 | ) | 401,327 | |||||||||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | 1,959,923 | 1,954,447 | (1,171,467 | ) | 810,173 | (985,452 | ) | 764,864 | |||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | 4,007,887 | 3,140,470 | (4,392,447 | ) | 1,722,812 | (793,824 | ) | 1,394,950 | |||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 31,241 | 9,184 | 12,537 | (54,343 | ) | 160,815 | 18,869 | ||||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | (220,357 | ) | (110,650 | ) | (70,989 | ) | (32,796 | ) | (286,444 | ) | (154,080 | ) | |||||||||||||||
Return of capital | — | — | (11,300 | ) | — | — | — | ||||||||||||||||||||
Total distributions to shareholders | (220,357 | ) | (110,650 | ) | (82,289 | ) | (32,796 | ) | (286,444 | ) | (154,080 | ) | |||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 40,891,183 | 27,194,924 | 140,023,221 | 39,571,339 | 38,717,136 | 23,102,425 | |||||||||||||||||||||
Value of shares repurchased | (20,116,550 | ) | (11,236,886 | ) | (141,477,925 | ) | (24,104,957 | ) | (24,829,491 | ) | (13,078,964 | ) | |||||||||||||||
Net income equalization | (31,241 | ) | (9,184 | ) | (12,537 | ) | 54,343 | (160,815 | ) | (18,869 | ) | ||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 20,743,392 | 15,948,854 | (1,467,241 | ) | 15,520,725 | 13,726,830 | 10,004,592 | ||||||||||||||||||||
Increase (Decrease) in Net Assets | 24,562,163 | 18,987,858 | (5,929,440 | ) | 17,156,398 | 12,807,377 | 11,264,331 | ||||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 18,987,858 | — | 17,156,398 | — | 11,264,331 | — | |||||||||||||||||||||
End of period | $ | 43,550,021 | $ | 18,987,858 | $ | 11,226,958 | $ | 17,156,398 | $ | 24,071,708 | $ | 11,264,331 | |||||||||||||||
Undistributed net investment income at end of period | $ | 96,459 | $ | 10,077 | $ | — | $ | 13,617 | $ | 32,020 | $ | 74,679 | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 1,200,000 | 1,000,000 | 5,400,000 | 1,500,000 | 1,400,000 | 900,000 | |||||||||||||||||||||
Shares repurchased | (600,000 | ) | (400,000 | ) | (5,500,000 | ) | (900,000 | ) | (900,000 | ) | (500,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 600,000 | — | 600,000 | — | 400,000 | — | |||||||||||||||||||||
Shares outstanding, end of period | 1,200,000 | 600,000 | 500,000 | 600,000 | 900,000 | 400,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
48
PowerShares Dynamic Energy Sector Portfolio | PowerShares Dynamic Financial Sector Portfolio | ||||||||||||||||||
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||||||||
OPERATIONS: | |||||||||||||||||||
Net investment income | $ | 135,372 | $ | 26,672 | $ | 151,071 | $ | 65,061 | |||||||||||
Net realized gain (loss) on investments | 2,805,702 | 473,132 | (659,895 | ) | (78,445 | ) | |||||||||||||
Net change in unrealized appreciation/(depreciation) of investments | 3,251,353 | 3,323,475 | (1,332,472 | ) | 440,110 | ||||||||||||||
Net increase (decrease) in net assets resulting from operations | 6,192,427 | 3,823,279 | (1,841,296 | ) | 426,726 | ||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | 19,097 | — | 31,709 | (10,327 | ) | ||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||
Net investment income | (75,016 | ) | (19,296 | ) | (115,884 | ) | (46,128 | ) | |||||||||||
Return of capital | — | — | — | — | |||||||||||||||
Total distributions to shareholders | (75,016 | ) | (19,296 | ) | (115,884 | ) | (46,128 | ) | |||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||
Proceeds from shares sold | 54,703,703 | 23,757,197 | 29,172,553 | 22,623,052 | |||||||||||||||
Value of shares repurchased | (37,283,571 | ) | (8,423,899 | ) | (12,226,396 | ) | (15,049,272 | ) | |||||||||||
Net income equalization | (19,097 | ) | — | (31,709 | ) | 10,327 | |||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 17,401,035 | 15,333,298 | 16,914,448 | 7,584,107 | |||||||||||||||
Increase (Decrease) in Net Assets | 23,537,543 | 19,137,281 | 14,988,977 | 7,954,378 | |||||||||||||||
NET ASSETS: | |||||||||||||||||||
Beginning of period | 19,137,281 | — | 7,954,378 | — | |||||||||||||||
End of period | $ | 42,674,824 | $ | 19,137,281 | $ | 22,943,355 | $ | 7,954,378 | |||||||||||
Undistributed net investment income at end of period | $ | 51,637 | $ | 4,453 | $ | 54,347 | $ | 18,933 | |||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||
Shares sold | 1,600,000 | 900,000 | 1,200,000 | 900,000 | |||||||||||||||
Shares repurchased | (1,100,000 | ) | (300,000 | ) | (500,000 | ) | (600,000 | ) | |||||||||||
Shares outstanding, beginning of period | 600,000 | — | 300,000 | — | |||||||||||||||
Shares outstanding, end of period | 1,100,000 | 600,000 | 1,000,000 | 300,000 |
49
Statements of Changes in Net Assets (Continued)
PowerShares Dynamic Healthcare Sector Portfolio | PowerShares Dynamic Industrials Sector Portfolio | PowerShares Dynamic Technology Sector Portfolio | |||||||||||||||||||||||||
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||||||||||||||
OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | (162,393 | ) | $ | (29,255 | ) | $ | 172,776 | $ | 29,984 | $ | (122,095 | ) | $ | (43,528 | ) | |||||||||||
Net realized gain (loss) on investments | (4,327,332 | ) | 884,944 | 934,358 | 711,614 | (2,888,234 | ) | 67,100 | |||||||||||||||||||
Net change in unrealized appreciation/depreciation of investments | (10,832,188 | ) | 1,141,247 | (1,455,235 | ) | 1,974,155 | (1,461,170 | ) | 1,642,264 | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (15,321,913 | ) | 1,996,936 | (348,101 | ) | 2,715,753 | (4,471,499 | ) | 1,665,836 | ||||||||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | (127,828 | ) | (34,205 | ) | 2,552 | 6,933 | (66,231 | ) | (11,761 | ) | |||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||||||||||
Net investment income | — | — | (164,357 | ) | (30,567 | ) | — | — | |||||||||||||||||||
Return of capital | — | — | — | (6,775 | ) | — | — | ||||||||||||||||||||
Total distributions to shareholders | — | — | (164,357 | ) | (37,342 | ) | — | — | |||||||||||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from shares sold | 144,890,658 | 68,579,509 | 120,525,074 | 34,518,651 | 62,259,099 | 30,855,070 | |||||||||||||||||||||
Value of shares repurchased | (67,732,497 | ) | (13,393,410 | ) | (110,025,370 | ) | (10,787,729 | ) | (42,752,339 | ) | (10,310,621 | ) | |||||||||||||||
Net income equalization | 127,828 | 34,205 | (2,552 | ) | (6,933 | ) | 66,231 | 11,761 | |||||||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | 77,285,989 | 55,220,304 | 10,497,152 | 23,723,989 | 19,572,991 | 20,556,210 | |||||||||||||||||||||
Increase (Decrease) in Net Assets | 61,836,248 | 57,183,035 | 9,987,246 | 26,409,333 | 15,035,261 | 22,210,285 | |||||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 57,183,035 | — | 26,409,333 | — | 22,210,285 | — | |||||||||||||||||||||
End of period | $ | 119,019,283 | $ | 57,183,035 | $ | 36,396,579 | $ | 26,409,333 | $ | 37,245,546 | $ | 22,210,285 | |||||||||||||||
Undistributed net investment income at end of period | $ | — | $ | — | $ | 11,088 | $ | — | $ | — | $ | — | |||||||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||||||||||
Shares sold | 5,000,000 | 2,500,000 | 3,900,000 | 1,300,000 | 2,300,000 | 1,200,000 | |||||||||||||||||||||
Shares repurchased | (2,400,000 | ) | (500,000 | ) | (3,600,000 | ) | (400,000 | ) | (1,600,000 | ) | (400,000 | ) | |||||||||||||||
Shares outstanding, beginning of period | 2,000,000 | — | 900,000 | — | 800,000 | — | |||||||||||||||||||||
Shares outstanding, end of period | 4,600,000 | 2,000,000 | 1,200,000 | 900,000 | 1,500,000 | 800,000 |
* Commencement of Investment Operations.
See Notes to Financial Statements.
50
PowerShares Dynamic Telecommunications & Wireless Portfolio | PowerShares Dynamic Utilities Portfolio | ||||||||||||||||||
Year Ended April 30, 2008 | Year Ended April 30, 2007 | Year Ended April 30, 2008 | Year Ended April 30, 2007 | ||||||||||||||||
OPERATIONS: | |||||||||||||||||||
Net investment income (loss) | $ | 278,211 | $ | 375,426 | $ | 968,208 | $ | 1,124,826 | |||||||||||
Net realized gain (loss) on investments | (801,387 | ) | 2,858,070 | 1,251,624 | 4,467,863 | ||||||||||||||
Net change in unrealized appreciation/depreciation of investments | (5,689,699 | ) | 2,042,772 | (5,229,214 | ) | 5,735,162 | |||||||||||||
Net increase (decrease) in net assets resulting from operations | (6,212,875 | ) | 5,276,268 | (3,009,382 | ) | 11,327,851 | |||||||||||||
Undistributed net investment income (loss) included in the price of units issued and redeemed | (37,684 | ) | (39,739 | ) | (107,405 | ) | 119,398 | ||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||||||||||||||||||
Net investment income | (353,595 | ) | (325,394 | ) | (935,373 | ) | (1,025,489 | ) | |||||||||||
Return of capital | (339,866 | ) | — | — | — | ||||||||||||||
Total distributions to shareholders | (693,461 | ) | (325,394 | ) | (935,373 | ) | (1,025,489 | ) | |||||||||||
SHAREHOLDER TRANSACTIONS: | |||||||||||||||||||
Proceeds from shares sold | 21,542,359 | 30,113,496 | 54,291,229 | 90,348,494 | |||||||||||||||
Value of shares repurchased | (29,922,409 | ) | (33,127,001 | ) | (69,996,903 | ) | (63,932,035 | ) | |||||||||||
Net income equalization | 37,684 | 39,739 | 107,405 | (119,398 | ) | ||||||||||||||
Net increase (decrease) in net assets resulting from shares transactions | (8,342,366 | ) | (2,973,766 | ) | (15,598,269 | ) | 26,297,061 | ||||||||||||
Increase (Decrease) in Net Assets | (15,286,386 | ) | 1,937,369 | (19,650,429 | ) | 36,718,821 | |||||||||||||
NET ASSETS: | |||||||||||||||||||
Beginning of period | 33,605,962 | 31,668,593 | 59,579,481 | 22,860,660 | |||||||||||||||
End of period | $ | 18,319,576 | $ | 33,605,962 | $ | 39,929,052 | $ | 59,579,481 | |||||||||||
Undistributed net investment income at end of period | $ | — | $ | 75,384 | $ | 185,518 | $ | 152,683 | |||||||||||
CHANGES IN SHARES OUTSTANDING: | |||||||||||||||||||
Shares sold | 1,100,000 | 1,700,000 | 2,800,000 | 5,000,000 | |||||||||||||||
Shares repurchased | (1,600,000 | ) | (1,900,000 | ) | (3,600,000 | ) | (3,500,000 | ) | |||||||||||
Shares outstanding, beginning of period | 1,700,000 | 1,900,000 | 2,900,000 | 1,400,000 | |||||||||||||||
Shares outstanding, end of period | 1,200,000 | 1,700,000 | 2,100,000 | 2,900,000 |
51
Financial Highlights
PowerShares Dynamic Basic Materials Sector Portfolio
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 31.65 | $ | 25.56 | |||||||
Net investment income** | 0.33 | 0.24 | |||||||||
Net realized and unrealized gain on investments | 4.55 | 6.05 | |||||||||
Total from operations | 4.88 | 6.29 | |||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.24 | ) | (0.20 | ) | |||||||
Net asset value at end of period | $ | 36.29 | $ | 31.65 | |||||||
TOTAL RETURN*** | 15.47 | % | 24.69 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 43,550 | $ | 18,988 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.68 | % | 0.71 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.96 | % | 1.32 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.95 | % | 1.52 | %† | |||||||
Portfolio turnover rate †† | 28 | % | 9 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.03 | $ | 0.02 |
PowerShares Dynamic Consumer Discretionary Sector Portfolio
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 28.59 | $ | 25.43 | |||||||
Net investment income** | 0.10 | 0.09 | |||||||||
Net realized and unrealized gain (loss) on investments | (6.11 | ) | 3.23 | ||||||||
Total from operations | (6.01 | ) | 3.32 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.11 | ) | (0.16 | ) | |||||||
Tax return of capital | (0.02 | ) | — | ||||||||
Total distributions | (0.13 | ) | (0.16 | ) | |||||||
Net asset value at end of period | $ | 22.45 | $ | 28.59 | |||||||
TOTAL RETURN*** | (21.10 | )% | 13.11 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 11,227 | $ | 17,156 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.70 | % | 0.72 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.31 | % | 1.41 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.36 | % | 0.65 | %† | |||||||
Portfolio turnover rate †† | 95 | % | 20 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | 0.02 | $ | (0.11 | ) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
See Notes to Financial Statements.
52
Financial Highlights (Continued)
PowerShares Dynamic Consumer Staples Sector Portfolio
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 28.16 | $ | 25.25 | |||||||
Net investment income** | 0.34 | 0.49 | |||||||||
Net realized and unrealized gain (loss) on investments | (1.43 | ) | 2.69 | ||||||||
Total from operations | (1.09 | ) | 3.18 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.32 | ) | (0.27 | ) | |||||||
Net asset value at end of period | $ | 26.75 | $ | 28.16 | |||||||
TOTAL RETURN*** | (3.94 | )% | 12.69 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 24,072 | $ | 11,264 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.69 | % | 0.73 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.18 | % | 1.46 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 1.22 | % | 3.42 | %† | |||||||
Portfolio turnover rate †† | 44 | % | 18 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.22 | $ | 0.04 |
PowerShares Dynamic Energy Sector Portfolio
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 31.90 | $ | 25.80 | |||||||
Net investment income** | 0.14 | 0.05 | |||||||||
Net realized and unrealized gain on investments | 6.84 | 6.08 | |||||||||
Total from operations | 6.98 | 6.13 | |||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.08 | ) | (0.03 | ) | |||||||
Net asset value at end of period | $ | 38.80 | $ | 31.90 | |||||||
TOTAL RETURN*** | 21.93 | % | 23.78 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 42,675 | $ | 19,137 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.68 | % | 0.71 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.96 | % | 1.22 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.41 | % | 0.28 | %† | |||||||
Portfolio turnover rate †† | 50 | % | 12 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | 0.02 | $ | — |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
See Notes to Financial Statements.
53
Financial Highlights (Continued)
PowerShares Dynamic Financial Sector Portfolio
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 26.51 | $ | 25.16 | |||||||
Net investment income** | 0.25 | 0.13 | |||||||||
Net realized and unrealized gain (loss) on investments | (3.59 | ) | 1.31 | ||||||||
Total from operations | (3.34 | ) | 1.44 | ||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.23 | ) | (0.09 | ) | |||||||
Net asset value at end of period | $ | 22.94 | $ | 26.51 | |||||||
TOTAL RETURN*** | (12.69 | )% | 5.72 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 22,943 | $ | 7,954 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.72 | % | 0.72 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 1.42 | % | 1.38 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 1.07 | % | 0.87 | %† | |||||||
Portfolio turnover rate †† | 50 | % | 33 | % | |||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | 0.05 | $ | (0.02 | ) |
PowerShares Dynamic Healthcare Sector Portfolio
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 28.59 | $ | 25.01 | |||||||
Net investment loss** | (0.05 | ) | (0.04 | ) | |||||||
Net realized and unrealized gain (loss) on investments | (2.67 | ) | 3.62 | ||||||||
Total from operations | (2.72 | ) | 3.58 | ||||||||
Net asset value at end of period | $ | 25.87 | $ | 28.59 | |||||||
TOTAL RETURN*** | (9.51 | )% | 14.31 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 119,019 | $ | 57,183 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.66 | % | 0.71 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.72 | % | 1.20 | %† | |||||||
Net investment loss, after Waivers and/or Recapture | (0.17 | )% | (0.31 | )%† | |||||||
Portfolio turnover rate †† | 75 | % | 14 | % | |||||||
Undistributed net investment loss included in price of units issued and redeemed**# | $ | (0.04 | ) | $ | (0.05 | ) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
See Notes to Financial Statements.
54
Financial Highlights (Continued)
PowerShares Dynamic Industrials Sector Portfolio
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 29.34 | $ | 25.72 | |||||||
Net investment income** | 0.14 | 0.04 | |||||||||
Net realized and unrealized gain on investments | 1.00 | 3.63 | |||||||||
Total from operations | 1.14 | 3.67 | |||||||||
Distributions to shareholders from: | |||||||||||
Net investment income | (0.15 | ) | (0.04 | ) | |||||||
Return of capital | — | (0.01 | ) | ||||||||
Total distributions | (0.15 | ) | (0.05 | ) | |||||||
Net asset value at end of period | $ | 30.33 | $ | 29.34 | |||||||
TOTAL RETURN*** | 3.90 | % | 14.28 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 36,397 | $ | 26,409 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.68 | % | 0.71 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.90 | % | 1.19 | %† | |||||||
Net investment income, after Waivers and/or Recapture | 0.45 | % | 0.30 | %† | |||||||
Portfolio turnover rate †† | 84 | % | 14 | % | |||||||
Undistributed net investment income included in price of units issued and redeemed**# | $ | — | (a) | $ | 0.01 |
PowerShares Dynamic Technology Sector Portfolio
Year Ended April 30, 2008 | For the Period October 12, 2006* Through April 30, 2007 | ||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||
Net asset value at beginning of period | $ | 27.76 | $ | 25.54 | |||||||
Net investment loss** | (0.09 | ) | (0.07 | ) | |||||||
Net realized and unrealized gain (loss) on investments | (2.84 | ) | 2.29 | ||||||||
Total from operations | (2.93 | ) | 2.22 | ||||||||
Net asset value at end of period | $ | 24.83 | $ | 27.76 | |||||||
TOTAL RETURN*** | (10.55 | )% | 8.69 | % | |||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||
Net assets at end of period (000's omitted) | $ | 37,246 | $ | 22,210 | |||||||
Ratio to average net assets of: | |||||||||||
Expenses, after Waivers and/or Recapture | 0.68 | % | 0.71 | %† | |||||||
Expenses, prior to Waivers and/or Recapture | 0.94 | % | 1.25 | %† | |||||||
Net investment loss, after Waivers and/or Recapture | (0.36 | )% | (0.49 | )%† | |||||||
Portfolio turnover rate †† | 77 | % | 27 | % | |||||||
Undistributed net investment loss included in price of units issued and redeemed**# | $ | (0.05 | ) | $ | (0.02 | ) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
(a) Amount represents less than $0.005.
See Notes to Financial Statements.
55
Financial Highlights (Continued)
PowerShares Dynamic Telecommunications & Wireless Portfolio
Year Ended April 30, | For the Period December 6, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 19.77 | $ | 16.67 | $ | 14.95 | |||||||||
Net investment income** | 0.18 | 0.22 | 0.05 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (4.23 | ) | 3.08 | 1.70 | |||||||||||
Total from operations | (4.05 | ) | 3.30 | 1.75 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.23 | ) | (0.20 | ) | (0.03 | ) | |||||||||
Return of capital | (0.22 | ) | — | — | |||||||||||
Total distributions | (0.45 | ) | (0.20 | ) | (0.03 | ) | |||||||||
Net asset value at end of period | $ | 15.27 | $ | 19.77 | $ | 16.67 | |||||||||
TOTAL RETURN*** | (20.96 | )% | 19.93 | % | 11.74 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 18,320 | $ | 33,606 | $ | 31,669 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.66 | % | 0.67 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 1.01 | % | 1.12 | % | 0.97 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 0.94 | % | 1.24 | % | 0.79 | %† | |||||||||
Portfolio turnover rate †† | 49 | % | 43 | % | 3 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.02 | ) | $ | (0.02 | ) | $ | — |
PowerShares Dynamic Utilities Portfolio
Year Ended April 30, | For the Period October 26, 2005* Through | ||||||||||||||
2008 | 2007 | April 30, 2006 | |||||||||||||
PER SHARE OPERATING PERFORMANCE: | |||||||||||||||
Net asset value at beginning of period | $ | 20.54 | $ | 16.33 | $ | 15.32 | |||||||||
Net investment income** | 0.45 | 0.44 | 0.24 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (1.53 | ) | 4.16 | 0.96 | |||||||||||
Total from operations | (1.08 | ) | 4.60 | 1.20 | |||||||||||
Distributions to shareholders from: | |||||||||||||||
Net investment income | (0.45 | ) | (0.39 | ) | (0.19 | ) | |||||||||
Net asset value at end of period | $ | 19.01 | $ | 20.54 | $ | 16.33 | |||||||||
TOTAL RETURN*** | (5.34 | )% | 28.48 | % | 7.82 | % | |||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||
Net assets at end of period (000's omitted) | $ | 39,929 | $ | 59,579 | $ | 22,861 | |||||||||
Ratio to average net assets of: | |||||||||||||||
Expenses, after Waivers and/or Recapture | 0.63 | % | 0.63 | % | 0.69 | %† | |||||||||
Expenses, prior to Waivers and/or Recapture | 0.86 | % | 0.92 | % | 0.89 | %† | |||||||||
Net investment income, after Waivers and/or Recapture | 2.32 | % | 2.34 | % | 2.62 | %† | |||||||||
Portfolio turnover rate †† | 64 | % | 39 | % | 38 | % | |||||||||
Undistributed net investment income (loss) included in price of units issued and redeemed**# | $ | (0.05 | ) | $ | 0.05 | $ | (0.01 | ) |
* Commencement of Investment Operations.
** Based on average shares outstanding.
*** Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total investment return calculated for a period of less than one year is not annualized.
† Annualized.
†† Portfolio turnover is not annualized and does not include securities received or delivered from processing creations or redemptions.
# The per share amount of equalization is presented to show the impact of equalization on distributable earnings per share. In prior periods, this amount has been included in the "Per Share Operating Performance" below the "Total from operations," with an offsetting amount included in "Net realized and unrealized gain (loss) on investments". The Fund's use of equalization does not affect net asset value per share, total return or the ratio of average net assets and the presentation has been revised accordingly.
See Notes to Financial Statements.
56
Notes to Financial Statements
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 1. Organization
PowerShares Exchange-Traded Fund Trust (the "Trust") was organized as a Massachusetts business trust on June 9, 2000 and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company, registered under the Investment Company Act of 1940, as amended (the "1940 Act"). As of period end, the Trust offers seventy-three portfolios. This report includes the following portfolios:
PowerShares Dynamic Basic Materials Sector Portfolio | "Dynamic Basic Materials Sector Portfolio" | ||||||
PowerShares Dynamic Consumer Discretionary Sector Portfolio | "Dynamic Consumer Discretionary Sector Portfolio" | ||||||
PowerShares Dynamic Consumer Staples Sector Portfolio | "Dynamic Consumer Staples Sector Portfolio" | ||||||
PowerShares Dynamic Energy Sector Portfolio | "Dynamic Energy Sector Portfolio" | ||||||
PowerShares Dynamic Financial Sector Portfolio | "Dynamic Financial Sector Portfolio" | ||||||
PowerShares Dynamic Healthcare Sector Portfolio | "Dynamic Healthcare Sector Portfolio" | ||||||
PowerShares Dynamic Industrials Sector Portfolio | "Dynamic Industrials Sector Portfolio" | ||||||
PowerShares Dynamic Technology Sector Portfolio | "Dynamic Technology Sector Portfolio" | ||||||
PowerShares Dynamic Telecommunications & Wireless Portfolio | "Dynamic Telecommunications & Wireless Portfolio" | ||||||
PowerShares Dynamic Utilities Portfolio | "Dynamic Utilities Portfolio" | ||||||
Each portfolio (the "Fund" or collectively the "Funds") represents a separate series of the Trust. The shares of the Funds are referred to herein as "Shares" or "Fund Shares." Each Fund's shares are listed and traded on the American Stock Exchange.
The Funds' market prices may differ to some degree from the net asset value of the shares of each Fund. Unlike conventional mutual funds, each Fund issues and redeems shares on a continuous basis, at net asset value, only in a large specified number of shares, each called a "Creation Unit." Creation Units are issued and redeemed generally in-kind for securities included in the relevant index. Except when aggregated in Creation Units, shares are not individually redeemable securities of the Funds. The investment objective of each Fund is to seek investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of the following equity indices:
Fund | Index | ||||||
Dynamic Basic Materials Sector Portfolio | Dynamic Basic Materials Sector IntellidexSM Index | ||||||
Dynamic Consumer Discretionary Sector Portfolio | Dynamic Consumer Discretionary Sector IntellidexSM Index | ||||||
Dynamic Consumer Staples Sector Portfolio | Dynamic Consumer Staples Sector IntellidexSM Index | ||||||
Dynamic Energy Sector Portfolio | Dynamic Energy Sector IntellidexSM Index | ||||||
Dynamic Financial Sector Portfolio | Dynamic Financial Sector IntellidexSM Index | ||||||
Dynamic Healthcare Sector Portfolio | Dynamic Healthcare Sector IntellidexSM Index | ||||||
Dynamic Industrials Sector Portfolio | Dynamic Industrials Sector IntellidexSM Index | ||||||
Dynamic Technology Sector Portfolio | Dynamic Technology Sector IntellidexSM Index | ||||||
57
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Fund | Index | ||||||
Dynamic Telecommunications & Wireless Portfolio | Dynamic Telecommunications & Wireless IntellidexSM Index | ||||||
Dynamic Utilities Portfolio | Dynamic Utilities IntellidexSM Index | ||||||
Note 2. Significant Accounting Policies
The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates.
A. Security Valuation
Securities, including restricted securities, are valued according to the following policy.
A security listed or traded on an exchange (except convertible bonds) 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. Listed options if no closing price is available are valued at the mean between the last bid and the ask 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 ask prices.
Investments in open-end registered investment companies are valued at the end of day net asset value per share.
Debt obligations (including convertible bonds) 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, yield, quality, type of issue, coupon rate, maturity, individual trading characteristics and other market data. Short-term obligations, including commercial paper, having 60 days or less to maturity are recorded at amortized cost which approximates value. Debt securities are subject to interest rate and credit risks. In addition, all debt securities involve some risk of default with respect to interest and/or principal payments.
Foreign securities (including foreign exchange contracts) are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. 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 are significant and may 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 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
58
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
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, ADRs 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.
Securities for which market quotations are not readily available or are 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/ask 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.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer's assets, general economic conditions, interest rates, investor perceptions and market liquidity.
B. Other Risk
The Funds may concentrate investments in a comparatively narrow segment of the economy. Consequently, such Fund may tend to be more volatile than other funds, and the value of the investments may tend to rise and fall more rapidly.
When investing in securities of a limited number of companies, each investment has a greater effect on the Fund's overall performance, and any change in the value of those securities could significantly affect the value of your investment in the Fund.
C. Federal Income Taxes
Each Fund intends to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and will distribute substantially all of the Fund's taxable earnings to its shareholders. As such, the Funds will not be subject to Federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for Federal income taxes is included.
Income and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from accounting principles generally accepted in the United States. These differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales, and Passive Foreign Investment Company adjustments, if any.
The Funds file tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally a Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
D. Investment Income and Investment Transactions
Dividend income is recorded on the ex-dividend date net of foreign taxes withheld, if any. Interest income is recorded on the accrual basis. Investment transactions are recorded on the trade date. Realized gains
59
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
and losses from the sale or disposition of securities are calculated on the specific identified cost basis. Dividends and interest received by a Fund may give rise to withholding and other taxes imposed by foreign countries. Corporate actions (including cash dividends) are recorded net of non-reclaimable foreign tax withholdings on the ex-dividend date. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.
E. Expenses
Expenses of the Trust, which are directly identifiable to a specific Fund, are applied to that Fund. Expenses which are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund.
Each Fund is responsible for all of its expenses, including the investment advisory fees, costs of transfer agency, custody, fund administration, legal, audit and other services, interest, taxes, brokerage commissions and other expenses connected with executions of portfolio transactions, any distribution fees or expenses and extraordinary expenses.
F. Dividends and Distributions to Shareholders
Each Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and distributes net realized taxable capital gains, if any, annually in cash. Such distributions on a tax basis are determined in conformity with income tax regulations which may differ from accounting principles generally accepted in the United States of America. Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund's financial statements as a tax return of capital at fiscal period end.
G. Equalization
All Funds use the accounting practice of equalization. This accounting method is used to keep the continuing shareholder's per share equity in undistributed net investment income from being affected by the continuous sales and redemptions of capital shares. Equalization is calculated on a per share basis whereby a portion of the proceeds from the sales and cost of repurchases of capital shares is applied to undistributed net investment income. The amount of equalization is disclosed in the Statements of Changes in Net Assets as undistributed net investment income included in the price of capital shares issued or redeemed. The distributions to shareholders of amounts so applied may be deemed to be a return of capital for tax purposes to the extent that such distributions exceed taxable income.
Note 3. Investment Advisory Agreement and Other Agreements
The Trust has entered into an Investment Advisory Agreement with Invesco PowerShares Capital Management LLC (formerly PowerShares Capital Management LLC) ("the Adviser") such that the Adviser has overall responsibility as the Funds' investment adviser for the selection and ongoing monitoring of the Funds' investments, managing the Funds' business affairs and providing certain clerical, bookkeeping and other administrative services. Each Fund has agreed to pay an annual fee of 0.50% of the Fund's average net assets.
The Adviser has entered into an Amended and Restated Excess Expense Agreement ("Excess Expense Agreement") with the Trust, under which the Adviser has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent the operating expenses of the Funds (excluding interest expense, brokerage commissions and other trading expenses, sub-licensing fees, offering costs, taxes and
60
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
extraordinary expenses) from exceeding 0.60% of average daily net assets per year (the "Expense Cap"), at least until August 30, 2009. Offering costs excluded from the Expense Cap are: (a) legal fees pertaining to the Funds' shares offered for sale; (b) Securities and Exchange Commission and state registration fees; and (c) initial fees paid to be listed on an exchange.
The Excess Expense Agreement provides that the expenses borne by the Adviser are subject to recapture by the Adviser for up to three years from the date the fee or expense was borne by the Adviser, but no recapture payment will be made by a Fund if it would result in each Fund exceeding its Expense Cap as specified above.
The net amount of fees waived and other expenses assumed by the Adviser and the amount of recapture paid to the Adviser pursuant to the Excess Expense Agreement are collectively referred to as 'Waivers and/or Recapture'.
During the year ended April 30, 2008, the amount of 'Waivers and/or Recapture' was as follows:
(Waivers) and/or Recapture | |||||||
Dynamic Basic Materials Sector Portfolio | $ | (91,354 | ) | ||||
Dynamic Consumer Discretionary Sector Portfolio | (97,703 | ) | |||||
Dynamic Consumer Staples Sector Portfolio | (96,704 | ) | |||||
Dynamic Energy Sector Portfolio | (89,121 | ) | |||||
Dynamic Financial Sector Portfolio | (99,693 | ) | |||||
Dynamic Healthcare Sector Portfolio | (54,628 | ) | |||||
Dynamic Industrials Sector Portfolio | (85,993 | ) | |||||
Dynamic Technology Sector Portfolio | (89,552 | ) | |||||
Dynamic Telecommunications & Wireless Portfolio | (112,390 | ) | |||||
Dynamic Utilities Portfolio | (96,025 | ) |
The net amounts of Waivers and/or Recapture are also shown on the Statements of Operations.
The amounts available for potential future recapture by the Adviser under the Excess Expense Agreement and the expiration schedule at April 30, 2008 are as follows:
Potential Recapture Amounts Expiring | |||||||||||||||||||
Total Potential Recapture Amount | 04/30/09 | 04/30/10 | 04/30/11 | ||||||||||||||||
Dynamic Basic Materials Sector Portfolio | $ | 139,638 | $ | — | $ | 48,284 | $ | 91,354 | |||||||||||
Dynamic Consumer Discretionary Sector Portfolio | 146,919 | — | 43,443 | 103,476 | |||||||||||||||
Dynamic Consumer Staples Sector Portfolio | 145,558 | — | 46,577 | 98,981 | |||||||||||||||
Dynamic Energy Sector Portfolio | 137,639 | — | 47,186 | 90,453 | |||||||||||||||
Dynamic Financial Sector Portfolio | 149,239 | — | 44,887 | 104,352 | |||||||||||||||
Dynamic Healthcare Sector Portfolio | 101,554 | — | 46,927 | 54,627 | |||||||||||||||
Dynamic Industrials Sector Portfolio | 134,039 | — | 45,415 | 88,624 | |||||||||||||||
Dynamic Technology Sector Portfolio | 137,911 | — | 48,145 | 89,766 | |||||||||||||||
Dynamic Telecommunications & Wireless Portfolio | 282,469 | 31,332 | 137,387 | 113,750 | |||||||||||||||
Dynamic Utilities Portfolio | 266,780 | 29,881 | 139,461 | 97,438 |
61
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Distribution Agreement
The Trust has entered into a Distribution Agreement with Invesco Aim Distributors, Inc. (formerly A I M Distributors, Inc.) (the "Distributor") which serves as the Distributor of Creation Units for each Fund. The Distributor does not maintain a secondary market in Shares.
Licensing Fee Agreement
The Adviser has entered into a licensing agreement for each Fund with the American Stock Exchange (the "Licensor").
The above trademark is owned by the respective Licensor. This trademark has been licensed to the Adviser for use with the Funds. The Funds are not sponsored, endorsed, sold or promoted by the Licensor and the Licensor makes no representation regarding the advisability of investing in any of these Funds. The Funds are required to pay the sub-licensing fees which are shown on the Statements of Operations.
The Bank of New York, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian and fund accounting and transfer agent for each Fund.
The custodian has agreed to provide overdraft protection to the Funds according to the terms of the service agreement.
Note 4. Federal Income Tax
At April 30, 2008, costs of investments on a tax basis including the adjustments for financial reporting purposes as of the most recently completed Federal income tax reporting period were as follows:
Cost | |||||||
Dynamic Basic Materials Sector Portfolio | $ | 39,885,268 | |||||
Dynamic Consumer Discretionary Sector Portfolio | 11,664,165 | ||||||
Dynamic Consumer Staples Sector Portfolio | 24,320,556 | ||||||
Dynamic Energy Sector Portfolio | 36,207,375 | ||||||
Dynamic Financial Sector Portfolio | 23,955,843 | ||||||
Dynamic Healthcare Sector Portfolio | 128,945,033 | ||||||
Dynamic Industrials Sector Portfolio | 36,088,705 | ||||||
Dynamic Technology Sector Portfolio | 37,086,730 | ||||||
Dynamic Telecommunications & Wireless Portfolio | 19,821,748 | ||||||
Dynamic Utilities Portfolio | 39,213,679 |
62
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
At April 30, 2008, the components of accumulated earnings/loss on a tax-basis were as follows:
Accumulated Earnings | Net Accumulated Capital and other Gains/Losses | Unrealized Appreciation/ Depreciation | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Total Accumulated Earnings/Loss | ||||||||||||||||||||||
Dynamic Basic Materials Sector Portfolio | $ | 96,459 | $ | (205,528 | ) | $ | 3,906,349 | $ | 5,336,028 | $ | (1,429,679 | ) | $ | 3,797,280 | |||||||||||||
Dynamic Consumer Discretionary Sector Portfolio | — | (1,249,661 | ) | (391,917 | ) | 587,319 | (979,236 | ) | (1,641,578 | ) | |||||||||||||||||
Dynamic Consumer Staples Sector Portfolio | 32,020 | (634,544 | ) | (267,834 | ) | 978,832 | (1,246,666 | ) | (870,358 | ) | |||||||||||||||||
Dynamic Energy Sector Portfolio | 51,637 | (880,885 | ) | 6,576,229 | 6,867,866 | (291,637 | ) | 5,746,981 | |||||||||||||||||||
Dynamic Financial Sector Portfolio | 54,347 | (614,940 | ) | (915,747 | ) | 514,832 | (1,430,579 | ) | (1,476,340 | ) | |||||||||||||||||
Dynamic Healthcare Sector Portfolio | — | (2,234,184 | ) | (9,875,850 | ) | 5,528,457 | (15,404,307 | ) | (12,110,034 | ) | |||||||||||||||||
Dynamic Industrials Sector Portfolio | 11,088 | (1,476,057 | ) | 518,126 | 1,926,400 | (1,408,274 | ) | (946,843 | ) | ||||||||||||||||||
Dynamic Technology Sector Portfolio | — | (2,465,875 | ) | 148,098 | 2,475,824 | (2,327,726 | ) | (2,317,777 | ) | ||||||||||||||||||
Dynamic Telecommunications & Wireless Portfolio | — | (2,932,872 | ) | (1,311,990 | ) | 1,032,403 | (2,344,393 | ) | (4,244,862 | ) | |||||||||||||||||
Dynamic Utilities Portfolio | 185,518 | (2,555,700 | ) | 947,782 | 1,978,788 | (1,031,006 | ) | (1,422,400 | ) |
Distributions to Shareholders:
The tax character of distributions paid was as follows:
Year ended April 30, 2008 | Period ended April 30, 2007 | ||||||||||
Distributions paid from Ordinary Income | Distributions paid from Ordinary Income | ||||||||||
Dynamic Basic Materials Sector Portfolio | $ | 220,357 | $ | 110,650 | |||||||
Dynamic Consumer Discretionary Sector Portfolio | 70,989 | 32,796 | |||||||||
Dynamic Consumer Staples Sector Portfolio | 286,444 | 154,080 | |||||||||
Dynamic Energy Sector Portfolio | 75,016 | 19,296 | |||||||||
Dynamic Financial Sector Portfolio | 115,884 | 46,128 | |||||||||
Dynamic Industrials Sector Portfolio | 164,357 | 30,567 | |||||||||
Dynamic Telecommunications & Wireless Portfolio | 353,595 | 325,394 | |||||||||
Dynamic Utilities Portfolio | 935,373 | 1,025,489 | |||||||||
Year ended April 30, 2008 | Period ended April 30, 2007 | ||||||||||
Distributions paid from Return of Capital | Distributions paid from Return of Capital | ||||||||||
Dynamic Consumer Discretionary Sector Portfolio | $ | 11,300 | $ | — | |||||||
Dynamic Industrials Sector Portfolio | — | 6,775 | |||||||||
Dynamic Telecommunications & Wireless Portfolio | 339,866 | — |
63
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
At April 30, 2008, for Federal income tax purposes, the Funds have capital loss carryforwards available as shown in the table below, to the extent provided by the regulations, to offset future capital gains through the years indicated. To the extent that these loss carryforwards are used to offset future capital gains, it is probable that the capital gains so offset will not be distributed to shareholders. The use of some portion of the capital loss carryforward by any one fund may be limited by federal tax rules. These rules limit the use of the carryforward when there has been a greater than fifty percent change in ownership of a fund.
Year of Expiration | Total | ||||||||||||||
2015 | 2016 | Amount | |||||||||||||
Dynamic Basic Materials Sector Portfolio | $ | — | $ | 205,528 | $ | 205,528 | |||||||||
Dynamic Consumer Discretionary Sector Portfolio | — | 1,249,661 | 1,249,661 | ||||||||||||
Dynamic Consumer Staples Sector Portfolio | — | 634,544 | 634,544 | ||||||||||||
Dynamic Energy Sector Portfolio | — | 880,885 | 880,885 | ||||||||||||
Dynamic Financial Sector Portfolio | — | 614,940 | 614,940 | ||||||||||||
Dynamic Healthcare Sector Portfolio | — | 2,234,184 | 2,234,184 | ||||||||||||
Dynamic Industrials Sector Portfolio | — | 1,476,057 | 1,476,057 | ||||||||||||
Dynamic Technology Sector Portfolio | — | 2,465,875 | 2,465,875 | ||||||||||||
Dynamic Telecommunications & Wireless Portfolio | 1,394,222 | 1,538,650 | 2,932,872 | ||||||||||||
Dynamic Utilities Portfolio | 430,964 | 2,124,736 | 2,555,700 |
During the year ended April 30, 2008, the Funds incurred and will elect to defer net capital losses as follows:
Post-October Losses | |||||||
Dynamic Basic Materials Sector Portfolio | $ | 1,866,473 | |||||
Dynamic Consumer Discretionary Sector Portfolio | 911,668 | ||||||
Dynamic Consumer Staples Sector Portfolio | 869,396 | ||||||
Dynamic Energy Sector Portfolio | 1,421,389 | ||||||
Dynamic Financial Sector Portfolio | 650,539 | ||||||
Dynamic Healthcare Sector Portfolio | 7,272,170 | ||||||
Dynamic Industrials Sector Portfolio | 3,401,595 | ||||||
Dynamic Technology Sector Portfolio | 4,790,225 | ||||||
Dynamic Telecommunications & Wireless Portfolio | 3,062,948 | ||||||
Dynamic Utilities Portfolio | 269,973 |
64
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
In order to present shares of beneficial interest and accumulated net realized gains or losses on the Statements of Assets and Liabilities that more closely represent their tax character, certain adjustments have been made to shares of beneficial interest, undistributed net investment income or loss and accumulated net realized gain or loss on investments. The differences are primarily due to redemptions in-kind, investments in partnerships, wash sales, book equalization, and net operating losses, if any. These adjustments have no effect on net assets. For the year ended April 30, 2008, the adjustments were as follows:
Undistributed Net Investment Income (Loss) | Accumulated Net Realized Gain (Loss) | Shares of Beneficial Interest | |||||||||||||
Dynamic Basic Materials Sector Portfolio | $ | (31,241 | ) | $ | (3,825,340 | ) | $ | 3,856,581 | |||||||
Dynamic Consumer Discretionary Sector Portfolio | (1,237 | ) | 1,383,656 | (1,382,419 | ) | ||||||||||
Dynamic Consumer Staples Sector Portfolio | (160,815 | ) | (1,294,711 | ) | 1,455,526 | ||||||||||
Dynamic Energy Sector Portfolio | (32,269 | ) | (4,881,270 | ) | 4,913,539 | ||||||||||
Dynamic Financial Sector Portfolio | (31,482 | ) | (355,694 | ) | 387,176 | ||||||||||
Dynamic Healthcare Sector Portfolio | 290,221 | (5,103,311 | ) | 4,813,090 | |||||||||||
Dynamic Industrials Sector Portfolio | 117 | (5,608,374 | ) | 5,608,257 | |||||||||||
Dynamic Technology Sector Portfolio | 188,326 | (3,857,981 | ) | 3,669,655 | |||||||||||
Dynamic Telecommunications & Wireless Portfolio | 377,550 | (3,437,934 | ) | 3,060,384 | |||||||||||
Dynamic Utilities Portfolio | 107,405 | (3,301,504 | ) | 3,194,099 |
Note 5. Investment Transactions
For the year ended April 30, 2008, the cost of securities purchased and proceeds from sales of securities, excluding short-term securities, money market funds and in-kind transactions, were as follows:
Purchases | Sales | ||||||||||
Dynamic Basic Materials Sector Portfolio | $ | 9,634,704 | $ | 8,990,892 | |||||||
Dynamic Consumer Discretionary Sector Portfolio | 14,003,924 | 13,777,170 | |||||||||
Dynamic Consumer Staples Sector Portfolio | 8,798,715 | 8,628,390 | |||||||||
Dynamic Energy Sector Portfolio | 16,238,180 | 17,021,931 | |||||||||
Dynamic Financial Sector Portfolio | 7,159,037 | 7,191,199 | |||||||||
Dynamic Healthcare Sector Portfolio | 69,702,961 | 70,721,547 | |||||||||
Dynamic Industrials Sector Portfolio | 31,822,321 | 32,929,108 | |||||||||
Dynamic Technology Sector Portfolio | 26,253,728 | 27,340,763 | |||||||||
Dynamic Telecommunications & Wireless Portfolio | 14,306,113 | 15,401,129 | |||||||||
Dynamic Utilities Portfolio | 26,646,446 | 28,604,766 |
65
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
For the year ended April 30, 2008, in-kind transactions were as follows:
Securities Received | Securities Delivered | ||||||||||
Dynamic Basic Materials Sector Portfolio | $ | 38,855,248 | $ | 18,670,522 | |||||||
Dynamic Consumer Discretionary Sector Portfolio | 137,526,257 | 139,283,866 | |||||||||
Dynamic Consumer Staples Sector Portfolio | 33,715,137 | 20,088,983 | |||||||||
Dynamic Energy Sector Portfolio | 52,244,279 | 34,040,635 | |||||||||
Dynamic Financial Sector Portfolio | 25,877,609 | 8,948,102 | |||||||||
Dynamic Healthcare Sector Portfolio | 145,741,787 | 67,777,882 | |||||||||
Dynamic Industrials Sector Portfolio | 120,646,391 | 109,012,565 | |||||||||
Dynamic Technology Sector Portfolio | 59,180,030 | 38,761,496 | |||||||||
Dynamic Telecommunications & Wireless Portfolio | 21,233,228 | 28,609,395 | |||||||||
Dynamic Utilities Portfolio | 52,170,538 | 65,810,398 |
Gains on in-kind transactions are not considered taxable gains for Federal income tax purposes.
Note 6. Trustees' Fees
The Funds compensate each Trustee on behalf of the Trust who is not an employee of the Trust or its affiliates. Interested Trustees and Officers of the Trust do not receive any Trustees' fees.
The Trust (has adopted a deferred compensation plan (the "Plan"). Under the Plan, a trustee who is not an "interested person" (as defined in the 1940 Act) and has elected to participate in the Plan (a "participating trustee") may defer receipt of all or a portion of his compensation ("Deferral Fees"). Such Deferred Fees are deemed to be invested in selected PowerShares Funds. The Deferral Fees payable to the participating trustee is valued as of the first business dates of each calendar quarter such Fees would have been paid to the participating trustee. The value increases with contributions or with increases in the value of the shares selected, and the value decreases with withdrawals or with declines in the value of the shares selected.
Note 7. Capital
Shares are created and redeemed by the Trust only in Creation Unit size aggregations of 100,000. Only authorized participants are permitted to create or redeem from the Funds. Such transactions are generally permitted on an in-kind basis, with a balancing cash component to equate the transaction to the net asset value per unit of each Fund of the Trust on the transaction date. Cash may be substituted equivalent to the value of certain securities generally when they are not available in sufficient quantity for delivery, not be eligible for trading by the Authorized Participant or as a result of other market circumstances.
Note 8. Indemnifications
Under the Trust's organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general indemnification clauses. The Trust's maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. However, based on experience, the Trust believes the risk of loss to be remote.
66
Notes to Financial Statements (Continued)
PowerShares Exchange-Traded Fund Trust
April 30, 2008
Note 9. New Accounting Pronouncement
On September 20, 2006, the FASB released Statement of Financial Accounting Standards No. 157 "Fair Value Measurement" ("FAS 157"). FAS 157 establishes an authoritative definition of fair value, sets out a framework for measuring fair value, and requires additional disclosures about fair-value measurement. The application of FAS 157 is required for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. Management has assessed the application of FAS 157 to the Funds and has determined that the adoption of FAS 157 is not expected to have a material impact on the Funds. Management intends for the Funds to adopt FAS 157 provisions during the fiscal year ending April 30, 2009.
67
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of PowerShares Exchange-Traded Fund Trust:
In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of each of the portfolios indicated in Note 1 of the financial statements (each a portfolio of PowerShares Exchange-Traded Fund Trust, hereafter referred to as the "Trust") at April 30, 2008, and the results of each of their operations, the changes in each of their net assets, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Trust's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at April 30, 2008 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
New York, New York
June 30, 2008
68
Supplemental Information
Federal Income Tax Information
The percentages of investment income (dividend income plus short-term gains, if any) qualify as follows:
Qualified dividend income | Dividends-received deduction | ||||||||||
Dynamic Basic Materials Sector Portfolio | 100 | % | 100 | % | |||||||
Dynamic Consumer Discretionary Sector Portfolio | 100 | % | 100 | % | |||||||
Dynamic Consumer Staples Sector Portfolio | 100 | % | 100 | % | |||||||
Dynamic Energy Sector Portfolio | 100 | % | 100 | % | |||||||
Dynamic Financial Sector Portfolio | 100 | % | 100 | % | |||||||
Dynamic Healthcare Sector Portfolio | 0 | % | 0 | % | |||||||
Dynamic Industrials Sector Portfolio | 100 | % | 100 | % | |||||||
Dynamic Technology Sector Portfolio | 0 | % | 0 | % | |||||||
Dynamic Telecommunication & Wireless Portfolio | 100 | % | 100 | % | |||||||
Dynamic Utilities Portfolio | 100 | % | 100 | % |
69
Supplemental Information (Continued)
Trustees and Officers
The Trustees who are not affiliated with the Adviser or affiliates of the Adviser ("Independent Trustees") and the Trustee who is affiliated with the Adviser ("Management Trustee") and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by each Trustee and the other directorships, if any, held by the Trustee, are shown below.
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Ronn R. Bagge (b. 1958) YQA Capital Management, LLC 1755 S. Naperville Rd., Suite 100 Wheaton, IL 60187 | Trustee | Since 2003 | YQA Capital Management LLC (July 1998-Present); formerly Owner/CEO of Electronic Dynamic Balancing Co., Inc. (high-speed rotating equipment service provider) | 104 | None | ||||||||||||||||||
Marc M. Kole (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | Assistant Vice President and Controller, Priority Health (September 2005-April 2008); formerly, Interim CFO, Priority Health (July 2006-April 2007); formerly Senior Vice President of Finance, United Healthcare (health insurance) (July 2004-July 2005); formerly Senior Vice President of Finance, Oxford Health Plans (June 2000-July 2004) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
70
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
D. Mark McMillan (b. 1963) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Partner, Bell, Boyd & Lloyd LLP (1989-Present) | 104 | None | ||||||||||||||||||
Philip M. Nussbaum (b. 1961) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2003 | Chairman, Performance Trust Capital Partners (formerly Betzold, Berg, Nussbaum & Heitman, Inc.) (November 2004-Present); formerly Managing Director, Communication Institute (May 2002-August 2003); formerly Executive Vice President of Finance, Betzold, Berg, Nussbaum & Heitman, Inc. (March 1994-1999) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
71
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Independent Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
Donald H. Wilson (b. 1960) c/o Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Trustee | Since 2006 | President, Chief Operating Officer and Chief Financial Officer, AMCORE Financial, Inc. (bank holding company) (August 2007-Present), formerly Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (February 2006-August 2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (May 1995- February 2006) | 104 | None | ||||||||||||||||||
* This is the date the Trustee began serving the Trust.
** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
72
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Management Trustees | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex*** Overseen by Trustees | Other Directorships Held by Trustees | ||||||||||||||||||
H. Bruce Bond (b.1963)** Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chairman of the Board, Trustee and Chief Executive Officer | Since 2003 | Managing Director, Invesco PowerShares Capital Management LLC (August 2002-Present); formerly Manager, Nuveen Investments (April 1998-August 2002) | 104 | None | ||||||||||||||||||
Availability of Additional Information About Funds' Trustees
The Statement of Additional Information includes additional information about the Funds' Trustees and is available, without charge, upon request at 800.337.4246.
* This is the date the Management Trustee began serving the Trust.
** Interested person as defined in Section 2(a)(19) of the 1940 Act.
*** Fund Complex includes all open-end funds (including all of their Portfolios) advised by the Adviser. At April 30, 2008, the Fund Complex consists of the Trust's 73 Portfolios and three other exchange-traded fund trusts with 31 Portfolios advised by the Adviser.
73
Supplemental Information (Continued)
Trustees and Officers (Continued)
Name, Address and Age of Officers | Position(s) with Trust | Length of Time Served* | Principal Occupation(s) During Past 5 Years | ||||||||||||
Bruce T. Duncan (b. 1954) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Financial Officer, Treasurer and Secretary | Chief Financial Officer and Treasurer Since 2006 Secretary Since 2008 | Senior Vice President of Finance, Invesco PowerShares Capital Management LLC (September 2005-Present); Private Practice Attorney (2000-2005); Vice President of Investor Relations, The ServiceMaster Company (1994-2000); Vice President of Taxes, The ServiceMaster Company (1990-2000) | ||||||||||||
Kevin R. Gustafson (b. 1965) Invesco PowerShares Capital Management LLC 301 W. Roosevelt Road Wheaton, IL 60187 | Chief Compliance Officer | Since 2004 | General Counsel, Invesco PowerShares Capital Management LLC (September 2004-Present); Chief Compliance Officer, Invesco PowerShares Capital Management LLC (September 2004-April 2008); Attorney, Nyberg & Gustafson (2001-2004); Attorney, Burke, Warren, McKay & Serritella, P.C. (1997-2000) | ||||||||||||
* This is the period for which the Officers began serving the Trust. Each Officer serves a one year term, until his successor is elected.
74
Board Considerations Regarding Continuation of Investment Advisory Agreement
At a meeting held on April 18, 2008, the Board of Trustees of the PowerShares Exchange-Traded Fund Trust (the "Trust"), including the Independent Trustees, unanimously approved the continuation of the Investment Advisory Agreement between Invesco PowerShares Capital Management LLC (the "Adviser") and the Trust for the following 70 series (the "Funds"):
PowerShares Dynamic Market Portfolio
PowerShares Dynamic OTC Portfolio
PowerShares Golden Dragon Halter USX China Portfolio
PowerShares High Yield Equity Dividend AchieversTM Portfolio
PowerShares WilderHill Clean Energy Portfolio
PowerShares Dynamic Large Cap Growth Portfolio
PowerShares Dynamic Large Cap Value Portfolio
PowerShares Dynamic Mid Cap Growth Portfolio
PowerShares Dynamic Mid Cap Value Portfolio
PowerShares Dynamic Small Cap Growth Portfolio
PowerShares Dynamic Small Cap Value Portfolio
PowerShares Dynamic Biotechnology & Genome Portfolio
PowerShares Dynamic Food & Beverage Portfolio
PowerShares Dynamic Leisure and Entertainment Portfolio
PowerShares Dynamic Media Portfolio
PowerShares Dynamic Networking Portfolio
PowerShares Dynamic Pharmaceuticals Portfolio
PowerShares Dynamic Semiconductors Portfolio
PowerShares Dynamic Software Portfolio
PowerShares Zacks Micro Cap Portfolio
PowerShares Aerospace & Defense Portfolio
PowerShares Dynamic Hardware & Consumer Electronics Portfolio
PowerShares Dynamic Telecommunications & Wireless Portfolio
PowerShares Value Line Timeliness Select Portfolio
PowerShares Dividend AchieversTM Portfolio
PowerShares International Dividend AchieversTM Portfolio
PowerShares High Growth Rate Dividend AchieversTM Portfolio
PowerShares Zacks Small Cap Portfolio
PowerShares Dynamic Building and Construction Portfolio
PowerShares Dynamic Energy Exploration and Production Portfolio
PowerShares Dynamic Insurance Portfolio
PowerShares Dynamic Oil and Gas Services Portfolio
PowerShares Dynamic Retail Portfolio
PowerShares Dynamic Utilities Portfolio
PowerShares Lux Nanotech Portfolio
PowerShares FTSE RAFI US 1000 Portfolio
PowerShares Water Resources Portfolio
PowerShares Dynamic Energy Sector Portfolio
PowerShares Dynamic Financial Sector Portfolio
PowerShares Dynamic Healthcare Sector Portfolio
PowerShares Dynamic Industrials Sector Portfolio
PowerShares Dynamic Large Cap Portfolio
PowerShares Dynamic MagniQuant Portfolio
PowerShares Dynamic Mid Cap Portfolio
PowerShares Dynamic Small Cap Portfolio
PowerShares Dynamic Technology Sector Portfolio
PowerShares Buyback Achievers(TM) Portfolio
PowerShares FTSE RAFI Basic Materials Sector Portfolio
PowerShares FTSE RAFI Consumer Goods Sector Portfolio
PowerShares FTSE RAFI Consumer Services Sector Portfolio
PowerShares FTSE RAFI Energy Sector Portfolio
PowerShares FTSE RAFI Financials Sector Portfolio
PowerShares FTSE RAFI Health Care Sector Portfolio
PowerShares FTSE RAFI Industrials Sector Portfolio
PowerShares FTSE RAFI Telecommunications & Technology Sector Portfolio
PowerShares FTSE RAFI US 1500 Small-Mid Portfolio
PowerShares FTSE RAFI Utilities Sector Portfolio
PowerShares Cleantech Portfolio
PowerShares Dynamic Aggressive Growth Portfolio
PowerShares Dynamic Banking Portfolio
PowerShares Dynamic Basic Materials Sector Portfolio
PowerShares Dynamic Consumer Discretionary Sector Portfolio
PowerShares Dynamic Consumer Staples Sector Portfolio
PowerShares Dynamic Healthcare Services Portfolio
PowerShares Dynamic Deep Value Portfolio
PowerShares Financial Preferred Portfolio
PowerShares Listed Private Equity Portfolio
PowerShares DWA Technical Leaders Portfolio
PowerShares Value Line Industry Rotation Portfolio
PowerShares WilderHill Progressive Energy Portfolio
75
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
The Trustees reviewed information from the Adviser describing: (i) the nature, extent and quality of services provided, (ii) the investment performance of the Funds and the Adviser, (iii) the costs of services provided and estimated profits realized by the Adviser, (iv) the extent to which economies of scale are realized as the Funds grow, (v) whether fee levels reflect any possible economies of scale for the benefit of Fund shareholders, (vi) comparisons of services rendered and amounts paid to other registered investment companies and (vii) any benefits realized by the Adviser from its relationship with each Fund. Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
Nature, Extent and Quality of Services. In evaluating the nature, extent and quality of the Adviser's services, the Trustees reviewed information concerning the functions performed by the Adviser for the Funds, information describing the Adviser's current organization, including operations assistance provided by the Adviser's parent organization, Invesco Ltd., and the background and experience of the persons responsible for the day-to-day management of the Funds. The Trustees reviewed matters related to the Adviser's portfolio transaction policies and procedures. The Trustees reviewed information on the performance of the Funds and the performance of their benchmark indices. The Trustees also reviewed reports on the correlation and tracking error between the underlying index and each Fund's performance and reviewed a report of Ibbotson Associates, a c onsultant to the Independent Trustees, that analyzed the reasons for any tracking error for certain of the Funds, which the Adviser then applied to its analysis of the tracking error between the underlying index and the performance of each Fund. The Trustees noted that, in each case, the correlation and tracking error was within the range set forth in the registration statement. The Trustees also concluded that each of the Funds is correlated to its underlying index and that the tracking error for each Fund was within a reasonable range in that Fund's particular circumstances.
The Trustees also considered the services provided by the Adviser in its oversight of the Funds' administrator, custodian and transfer agent. They noted the significant amount of time and effort that had been devoted to this oversight function.
Based on their review, the Trustees found that the nature and extent of services provided to the Funds under the Investment Advisory Agreement are appropriate and that the quality is good.
Fees, Expenses and Profitability. The Trustees reviewed and discussed the information provided by the Adviser on each Fund's expense ratio and the advisory fee, as compared to three categories of comparable funds selected by Lipper Inc., an independent source: exchange-traded index funds ("ETFs"), open-end (non-ETF) index funds and open-end actively-managed funds. The Adviser supplemented the information prepared by Lipper Inc. with data it compiled on expense ratios and advisory fees of newer ETFs that recently commenced operations. The Trustees noted that the annual advisory fee charged to the Funds was identical (0.50% of average net assets), except for the advisory fee for the PowerShares High Yield Equity Dividend Achievers(TM) Portfolio, the PowerShares Dividend Achievers(TM) Portfolio, the PowerShares High Growth Rate Dividend Achievers(TM) Por tfolio and the PowerShares International Dividend Achievers(TM) Portfolio (for each of which the annual advisory fee was 0.40% of average net assets), and that the Adviser had agreed to waive the fee and/or pay expenses to the extent necessary to prevent the annual operating expenses of each Fund (excluding interest expenses, licensing fees and offering costs (for all Funds other than the initial two Funds, the PowerShares Dynamic OTC Portfolio and the PowerShares Dynamic Market Portfolio), brokerage commissions and other trading expenses, taxes and extraordinary
76
Board Considerations Regarding Continuation of Investment Advisory Agreement (Continued)
expenses) from exceeding 0.60% of average net assets (0.50% of average net assets for the PowerShares High Yield Equity Dividend Achievers(TM) Portfolio, the PowerShares Dividend Achievers(TM) Portfolio, the PowerShares High Growth Rate Dividend Achievers(TM) Portfolio and the PowerShares International Dividend Achievers(TM) Portfolio) at least until April 30, 2009. The Trustees noted that the Adviser represented that it does not provide investment management services to clients other than the Trust and other exchange-traded funds overseen by the Board. The Trustees noted that the advisory fees were at the higher end of the ETF peer funds, but were lower than the median of the open-end actively-managed peer funds. The Trustees determined that the advisory fees were reasonable because of the complexity of the indices, which generally require more frequent rebalancing of the portfolios, the distinguishing factors of the Funds, and the higher administrative, operational and management oversight costs for the Adviser. With respect to the Funds' expense ratios, the Trustees noted that the net expense ratios were at the higher end of the ETF peer funds, but were generally lower than the median of the expense ratios of the open-end (non-ETF) index peer funds and the median of the open-end actively-managed peer funds. The Trustees noted that a significant component of the non-advisory fee expenses was the license fees paid by the Funds. The Board concluded that the advisory fee and expense ratio of each Fund are competitive and that the advisory fee for each Fund is reasonable and appropriate in amount in light of the quality of services provided and the expense cap in place.
In conjunction with their review of fees, the Trustees also considered information provided by the Adviser on the revenues received by the Adviser under the Investment Advisory Agreement for each Fund, as well as the fees waived and expenses reimbursed by the Adviser for the Funds. The Trustees reviewed information provided by the Adviser on its profitability as well as any profits realized by the Adviser from its relationship to each Fund. The Trustees concluded that the profitability to the Adviser of the advisory services provided to the Funds is not unreasonable.
Economies of Scale and Whether Fee Levels Reflect These Economies of Scale. The Trustees reviewed the information provided by the Adviser as to the extent to which economies of scale are realized as each Fund grows and whether fee levels reflect economies of scale for the benefit of shareholders. The Trustees reviewed each Fund's asset size, expense ratio, expense limitation agreed to by the Adviser and whether the investment process produced economies of scale. The Trustees noted that certain fixed costs associated with the management of the Funds are being reduced on a per-Fund basis as additional Funds are added, and that the gradual reduction of the per-Fund cost enabled the Adviser to operate some of the Funds under the expense cap, which potentially would lower the costs to shareholders. The Trustees noted that the Excess Expense Agreement with the Trust provided that the Adviser was entitled to be reimbursed by each Fund for fees waived or expenses absorbed pursuant to the expense cap for a period of three years from the date the fee or expense was incurred, provided that no reimbursement would be made that would result in a Fund exceeding its expense cap.
The Trustees noted that the Adviser had not identified any further benefits that it derived from its relationship with the Funds, and had noted that it does not have any soft-dollar arrangements.
Based on all of the information considered and the conclusions reached, the Board, including the Independent Trustees, determined to approve the continuation of the Investment Advisory Agreement for each Fund listed above. No single factor was determinative in the Board's analysis.
77
This page intentionally left blank
This page intentionally left blank
This page intentionally left blank
PROXY VOTING POLICIES AND PROCEDURES
A description of the Funds' proxy voting policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 337-4246. This information is also available on the Securities and Exchange Commission's ("Commission") website at www.sec.gov.
Information regarding how the Funds voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request, by (i) calling (800) 337-4246; or (ii) accessing the Funds' Form N-PX on the Commission's website at www.sec.gov.
QUARTERLY PORTFOLIOS
The Funds file their complete schedules of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds' Forms N-Q are available on the Commission's website at www.sec.gov. The Funds' Forms N-Q may also be reviewed and copied at the Commission's Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330.
There are risks involved in investing in ETFs, including possible loss of money. Investing in securities of small and medium sized companies involves greater risk than is customarily associated with investing in more established companies, and investments in concentrated industry sectors involve greater risks than investments that are more diversified. PowerShares ETFs are not actively managed and are subject to risks similar to stocks, including those related to short selling and margin maintenance. PowerShares ETFs are not FDIC insured, may lose value and have no bank guarantee. PowerShares is a registered trademark of InvescoPowerShares Capital Management LLC. Past performance is not a guarantee of future results.
Invesco Aim Distributors, Inc. is the distributor of the PowerShares Exchange-Traded Fund Trust.
An investor should consider each Fund's investment objective, risks, charges and expenses carefully before investing. For more complete information about PowerShares ETFs call Invesco Aim Distributors, Inc. at (800) 337-4246 or visit our website invescopowershares.com for a prospectus. Please read the prospectus carefully before investing.
301 West Roosevelt Road
Wheaton, IL 60187
800.983.0903
www.invescopowershares.com
© 2008 Invesco PowerShares Capital Management LLC P-PS-AR-3
Item 2. Code of Ethics.
The Registrant has adopted a Code of Ethics that applies to the Registrant’s principal executive officer and principal financial officer. This Code is filed as an exhibit to this report on Form N-CSR under Item 12(a)(1).
Item 3. Audit Committee Financial Expert.
The Registrant’s Board of Trustees has determined that the Registrant has three “audit committee financial experts” serving on its audit committee: Mr. Philip M. Nussbaum, Mr. Marc M. Kole, and Mr. Donald H. Wilson. Each of these audit committee members is “independent,” meaning that he is not an “interested person” of the Registrant (as that term is defined in Section 2(a)(19) of the Investment Company Act of 1940) and he does not accept any consulting, advisory, or other compensatory fee from the Registrant (except in the capacity as a Board or committee member).
An “audit committee financial expert” is not an “expert” for any purpose, including for purposes of Section 11 of the Securities Act of 1933, as a result of being designated as an “audit committee financial expert.” Further, the designation of a person as an “audit committee financial expert” does not mean that the person has any greater duties, obligations, or liability than those imposed on the person without the “audit committee financial expert” designation. Similarly, the designation of a person as an “audit committee financial expert” does not affect the duties, obligations, or liability of any other member of the audit committee or board of trustees.
Item 4. Principal Accountant Fees and Services.
(a) Audit Fees. The aggregate fees billed for the Registrant’s fiscal years ended April 30, 2008 and April 30, 2007 for professional services rendered by the principal accountant for the audit of the Registrant’s annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for such fiscal years were $1,200,500 and $1,088,500, respectively.
(b) Audit-Related Fees. The aggregate fees billed for the Registrant’s fiscal years ended April 30, 2008 and April 30, 2007 for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the Registrant’s financial statements and are not reported above in Item 4(a) were $0 and $0, respectively.
(c) Tax Fees. The aggregate fees billed for the Registrant’s fiscal years ended April 30, 2008 and April 30, 2007 for professional services rendered by the principal accountant for tax return reviews were $514,050 and $456,550, respectively.
(d) All Other Fees. All other aggregate fees billed for the Registrant’s fiscal years ended April 30, 2008 and April 30, 2007 were $0 and $0, respectively.
(e) Audit Committee Pre-Approval Policies and Procedures. In accordance with Rule 2-01(c)(7)(A), the Audit Committee pre-approves all of the Audit and Tax Fees of the Registrant. None of the services described in paragraphs (b) and (c) above were approved by the Audit Committee in accordance with paragraph (c) (7) (i) (c) of Rule 2-01 of Regulation S-X.
Item 5. Audit Committee of Listed Registrants.
The Registrant has a separately designated Audit Committee established in accordance with Section 3(a)(58)(A) of the Exchange Act, which consists of the independent trustees. The Audit Committee members are Philip M. Nussbaum, D. Mark McMillan, Ronn R. Bagge, Marc M. Kole and Donald H. Wilson.
Items 6. Schedule of Investments.
The Schedules of Investments are included as a part of the report to shareholders 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 Investment 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.
There have been no changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees that would require disclosure herein.
Item 11. Controls and Procedures.
a) Based on their evaluation of the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3-(c) under the Investment Company Act of 1940) as of a date within 90 days of the filing date of this report, the Registrant’s President (principal executive officer) and Chief Financial Officer (principal financial officer) have concluded that such disclosure controls and procedures are reasonably designed and are operating effectively to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to them by others within those entities, particularly during
the period in which this report is being prepared, and that the information required in filings on Form N-CSR is recorded, processed, summarized and reported on a timely basis.
b) There were no significant changes in the Registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the Registrant’s fourth fiscal quarter of 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. Exhibits.
(a)(1) Code of Ethics.
(a)(2) Certifications of the Registrant’s Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 are attached as Exhibit 99.CERT.
(b) Certifications of the Registrant’s Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 is attached as Exhibit 99.906CERT.
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) | PowerShares Exchange-Traded Fund Trust |
| ||
|
| |||
By: | /s/ H. Bruce Bond |
| ||
|
|
| ||
Name: | H. Bruce Bond | |||
|
| |||
Title: | Chairman and Chief Executive Officer | |||
|
| |||
Date: | July 3, 2008 | |||
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
By: | /s/ H. Bruce Bond |
| ||
|
| |||
Name: | H. Bruce Bond | |||
|
| |||
Title: | Chairman and Chief Executive Officer | |||
|
| |||
Date: | July 3, 2008 | |||
|
| |||
By: | /s/ Bruce T. Duncan |
| ||
|
| |||
Name: | Bruce T. Duncan | |||
|
| |||
Title: | Chief Financial Officer | |||
|
| |||
Date: | July 3, 2008 | |||