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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 811-05426
AIM Investment Funds (Invesco Investment Funds)
(Exact name of registrant as specified in charter)
11 Greenway Plaza, Suite 1000 Houston, Texas 77046
(Address of principal executive offices) (Zip code)
Sheri Morris 11 Greenway Plaza, Suite 1000 Houston, Texas 77046
(Name and address of agent for service)
Registrant’s telephone number, including area code: (713) 626-1919
Date of fiscal year end: 10/31
Date of reporting period: 04/30/18
Item 1. Report to Stockholders.
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco All Cap Market Neutral Fund
| ||||
Nasdaq: | ||||
A: CPNAX ∎ C: CPNCX ∎ R: CPNRX ∎ Y: CPNYX ∎ R5: CPNFX ∎ R6: CPNSX |
| ||||
2
| Fund Performance
| |||
4
| Letters to Shareholders
| |||
5
| Schedule of Investments
| |||
14
| Financial Statements
| |||
16
| Notes to Financial Statements
| |||
24
| Financial Highlights
| |||
25 | Fund Expenses
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | -5.72 | % | ||
Class C Shares | -6.10 | |||
Class R Shares | -5.87 | |||
Class Y Shares | -5.56 | |||
Class R5 Shares | -5.54 | |||
Class R6 Shares | -5.54 | |||
FTSE US 3-Month Treasury Bill Index▼ (Broad Market/Style-Specific Index) | 0.67 | |||
Lipper Alternative Equity Market Neutral Funds Index∎ (Peer Group Index) | 0.14 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
|
The FTSE US 3-Month Treasury Bill Index is an unmanaged index representative of three-month US Treasury bills.
The Lipper Alternative Equity Market Neutral Funds Index is an unmanaged index considered representative of alternative equity market neutral funds tracked by Lipper.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco All Cap Market Neutral Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
| ||||||
Class A Shares |
| |||||
Inception (12/17/13) | 0.25 | % | ||||
1 Year | -10.60 | |||||
Class C Shares |
| |||||
Inception (12/17/13) | 0.80 | % | ||||
1 Year | -7.02 | |||||
Class R Shares |
| |||||
Inception (12/17/13) | 1.30 | % | ||||
1 Year | -5.68 | |||||
Class Y Shares |
| |||||
Inception (12/17/13) | 1.80 | % | ||||
1 Year | -5.19 | |||||
Class R5 Shares |
| |||||
Inception (12/17/13) | 1.85 | % | ||||
1 Year | -5.07 | |||||
Class R6 Shares |
| |||||
Inception | 1.83 | % | ||||
1 Year | -5.07 |
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.41%, 2.16%, 1.66%, 1.16%, 1.04% and 1.04%, respectively.1 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.42%, 2.17%, 1.67%, 1.17%, 1.05% and 1.05%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (12/17/13) | 0.62 | % | ||||
1 Year | -10.72 | |||||
Class C Shares |
| |||||
Inception (12/17/13) | 1.20 | % | ||||
1 Year | -7.12 | |||||
Class R Shares |
| |||||
Inception (12/17/13) | 1.69 | % | ||||
1 Year | -5.80 | |||||
Class Y Shares |
| |||||
Inception (12/17/13) | 2.17 | % | ||||
1 Year | -5.43 | |||||
Class R5 Shares |
| |||||
Inception (12/17/13) | 2.22 | % | ||||
1 Year | -5.22 | |||||
Class R6 Shares |
| |||||
Inception | 2.20 | % | ||||
1 Year | -5.32 |
report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 class shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco All Cap Market Neutral Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco All Cap Market Neutral Fund
Schedule of Investments(a)
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–94.51% |
| |||||||
Advertising–0.18% | ||||||||
Interpublic Group of Cos., Inc. (The) | 8,300 | $ | 195,797 | |||||
Aerospace & Defense–0.11% | ||||||||
Triumph Group, Inc. | 5,100 | 120,615 | ||||||
Airlines–0.27% | ||||||||
Copa Holdings, S.A.–Class A (Panama)(b) | 2,450 | 287,067 | ||||||
Alternative Carriers–0.22% | ||||||||
Vonage Holdings Corp. | 21,250 | 237,575 | ||||||
Apparel Retail–3.71% | ||||||||
Abercrombie & Fitch Co.–Class A | 50,300 | 1,288,686 | ||||||
Tailored Brands, Inc. | 69,100 | 2,180,105 | ||||||
Tilly’s Inc.–Class A | 45,600 | 511,176 | ||||||
3,979,967 | ||||||||
Apparel, Accessories & Luxury Goods–0.73% | ||||||||
Fossil Group, Inc. | 10,050 | 150,248 | ||||||
Michael Kors Holdings Ltd.(b) | 6,500 | 444,730 | ||||||
Ralph Lauren Corp. | 1,750 | 192,237 | ||||||
787,215 | ||||||||
Application Software–0.33% | ||||||||
Datawatch Corp. | 16,250 | 149,500 | ||||||
Upland Software, Inc. | 7,700 | 209,209 | ||||||
358,709 | ||||||||
Auto Parts & Equipment–0.54% | ||||||||
Delphi Technologies PLC(b) | 3,000 | 145,230 | ||||||
Shiloh Industries, Inc. | 15,750 | 130,883 | ||||||
Stoneridge, Inc. | 11,400 | 300,162 | ||||||
576,275 | ||||||||
Automobile Manufacturers–0.27% | ||||||||
Winnebago Industries, Inc. | 7,700 | 291,830 | ||||||
Biotechnology–9.59% | ||||||||
Adverum Biotechnologies, Inc. | 36,350 | 227,188 | ||||||
Akebia Therapeutics, Inc. | 7,750 | 71,378 | ||||||
BioSpecifics Technologies Corp. | 5,100 | 216,342 | ||||||
Catalyst Biosciences, Inc. | 16,950 | 482,905 | ||||||
ChemoCentryx, Inc. | 48,550 | 530,651 | ||||||
Concert Pharmaceuticals, Inc. | 28,900 | 527,425 | ||||||
CytomX Therapeutics, Inc. | 29,600 | 778,480 | ||||||
Emergent Biosolutions, Inc. | 2,750 | 142,615 | ||||||
Enanta Pharmaceuticals, Inc. | 17,400 | 1,619,070 | ||||||
ImmunoGen, Inc. | 159,150 | 1,749,058 | ||||||
Madrigal Pharmaceuticals, Inc. | 3,850 | 435,666 | ||||||
Myriad Genetics, Inc. | 31,400 | 888,306 | ||||||
Pieris Pharmaceuticals, Inc. | 76,500 | 487,305 | ||||||
Sangamo BioSciences, Inc. | 85,600 | 1,352,480 |
Shares | Value | |||||||
Biotechnology–(continued) | ||||||||
Spectrum Pharmaceuticals, Inc.(b) | 11,500 | $ | 183,080 | |||||
Strongbridge Biopharma PLC | 13,600 | 104,040 | ||||||
Vericel Corp.(b) | 16,000 | 213,600 | ||||||
XOMA Corp.(b) | 11,650 | 277,503 | ||||||
10,287,092 | ||||||||
Broadcasting–0.20% | ||||||||
Beasley Broadcast Group, Inc.–Class A | 18,850 | 213,948 | ||||||
Cable & Satellite–0.08% | ||||||||
MSG Networks, Inc.–Class A(b) | 4,100 | 84,050 | ||||||
Casinos & Gaming–1.07% | ||||||||
Scientific Games Corp.(b) | 21,500 | 1,145,950 | ||||||
Coal & Consumable Fuels–1.10% | ||||||||
Arch Coal, Inc.–Class A | 4,950 | 400,108 | ||||||
Cloud Peak Energy Inc. | 85,150 | 271,628 | ||||||
CONSOL Energy, Inc. | 4,850 | 152,533 | ||||||
Hallador Energy Co. | 54,950 | 359,373 | ||||||
1,183,642 | ||||||||
Commercial Printing–1.08% | ||||||||
Cimpress N.V. (Netherlands) | 4,650 | 668,717 | ||||||
Ennis, Inc.(b) | 9,300 | 166,470 | ||||||
Quad/Graphics, Inc. | 13,200 | 326,172 | ||||||
1,161,359 | ||||||||
Commodity Chemicals–0.54% | ||||||||
Methanex Corp. (Canada)(b) | 9,550 | 576,820 | ||||||
Communications Equipment–2.03% | ||||||||
Comtech Telecommunications Corp. | 37,700 | 1,153,243 | ||||||
Extreme Networks, Inc. | 73,700 | 788,590 | ||||||
NETGEAR, Inc.(b) | 900 | 49,770 | ||||||
PC-Tel, Inc.(b) | 26,800 | 191,620 | ||||||
2,183,223 | ||||||||
Computer & Electronics Retail–0.59% | ||||||||
Conn’s, Inc. | 24,850 | 633,675 | ||||||
Construction Machinery & Heavy Trucks–1.16% | ||||||||
Commercial Vehicle Group, Inc. | 37,700 | 252,967 | ||||||
Manitowoc Co., Inc. (The) | 24,900 | 613,785 | ||||||
Meritor, Inc. | 19,150 | 372,850 | ||||||
1,239,602 | ||||||||
Consumer Electronics–0.41% | ||||||||
ZAGG, Inc.(b) | 38,950 | 436,240 | ||||||
Consumer Finance–0.25% | ||||||||
Navient Corp. | 13,250 | 175,695 | ||||||
Nelnet, Inc.–Class A | 1,800 | 95,058 | ||||||
270,753 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco All Cap Market Neutral Fund
Shares | Value | |||||||
Copper–0.47% | ||||||||
Freeport-McMoRan Inc. | 33,500 | $ | 509,535 | |||||
Data Processing & Outsourced Services–1.37% | ||||||||
Alliance Data Systems Corp. | 650 | 131,982 | ||||||
Everi Holdings Inc. | 109,900 | 704,459 | ||||||
StarTek, Inc. | 14,700 | 129,948 | ||||||
Syntel, Inc.(b) | 17,300 | 499,624 | ||||||
1,466,013 | ||||||||
Department Stores–1.36% | ||||||||
Dillard’s, Inc.–Class A | 8,750 | 652,312 | ||||||
Macy’s, Inc. | 26,100 | 810,927 | ||||||
1,463,239 | ||||||||
Diversified Chemicals–0.67% | ||||||||
Huntsman Corp. | 24,000 | 714,480 | ||||||
Diversified Metals & Mining–0.53% | ||||||||
Teck Resources Ltd.–Class B (Canada) | 22,750 | 571,708 | ||||||
Education Services–0.49% | ||||||||
Cambium Learning Group Inc.(b) | 51,600 | 523,224 | ||||||
Electronic Components–0.30% | ||||||||
Bel Fuse, Inc.–Class B | 5,450 | 105,458 | ||||||
IntriCon Corp. | 9,100 | 212,030 | ||||||
317,488 | ||||||||
Electronic Equipment & Instruments–1.58% | ||||||||
Control4 Corp. | 39,400 | 821,096 | ||||||
Electro Scientific Industries, Inc. | 48,500 | 873,000 | ||||||
1,694,096 | ||||||||
Fertilizers & Agricultural Chemicals–1.32% | ||||||||
CF Industries Holdings, Inc. | 36,500 | 1,416,200 | ||||||
Food Distributors–0.12% | ||||||||
Chefs Warehouse, Inc. (The) | 5,450 | 132,163 | ||||||
Footwear–1.67% | ||||||||
Crocs, Inc. | 21,500 | 339,700 | ||||||
Deckers Outdoor Corp. | 13,250 | 1,235,695 | ||||||
Rocky Brands, Inc. | 9,250 | 220,612 | ||||||
1,796,007 | ||||||||
Health Care Equipment–3.53% | ||||||||
Accuray Inc.(b) | 90,150 | 450,750 | ||||||
Cutera, Inc. | 20,550 | 1,030,582 | ||||||
Fonar Corp. | 8,100 | 230,445 | ||||||
iRadimed Corp. | 5,050 | 88,123 | ||||||
Novocure Ltd. | 72,800 | 1,987,440 | ||||||
3,787,340 | ||||||||
Health Care Facilities–1.46% | ||||||||
AAC Holdings, Inc. | 18,550 | 210,171 | ||||||
Community Health Systems, Inc. | 26,600 | 100,548 | ||||||
Quorum Health Corp. | 41,400 | 291,870 |
Shares | Value | |||||||
Health Care Facilities–(continued) | ||||||||
Tenet Healthcare Corp.(b) | 40,050 | $ | 958,797 | |||||
1,561,386 | ||||||||
Health Care Services–1.75% | ||||||||
American Renal Associates Holdings, Inc.(b) | 20,850 | 305,453 | ||||||
Psychemedics Corp. | 9,750 | 205,335 | ||||||
RadNet, Inc. | 60,600 | 802,950 | ||||||
Tivity Health, Inc.(b) | 15,550 | 559,022 | ||||||
1,872,760 | ||||||||
Health Care Supplies–1.49% | ||||||||
Haemonetics Corp. | 4,600 | 358,984 | ||||||
Lantheus Holdings, Inc. | 58,850 | 1,047,530 | ||||||
STAAR Surgical Co. | 11,750 | 190,937 | ||||||
1,597,451 | ||||||||
Health Care Technology–1.13% | ||||||||
Simulations Plus, Inc. | 4,500 | 74,025 | ||||||
Tabula Rasa Healthcare, Inc. | 27,850 | 1,141,571 | ||||||
1,215,596 | ||||||||
Homebuilding–0.55% | ||||||||
KB Home | 22,050 | 585,428 | ||||||
Homefurnishing Retail–2.06% | ||||||||
Aaron’s, Inc. | 18,800 | 785,276 | ||||||
RH(b) | 14,950 | 1,426,977 | ||||||
2,212,253 | ||||||||
Independent Power Producers & Energy Traders–0.19% | ||||||||
NRG Energy, Inc. | 6,700 | 207,700 | ||||||
Industrial Machinery–2.38% | ||||||||
DMC Global, Inc. | 8,250 | 319,275 | ||||||
Harsco Corp. | 92,250 | 1,886,512 | ||||||
L.B. Foster Co.–Class A | 14,750 | 347,363 | ||||||
2,553,150 | ||||||||
Integrated Telecommunication Services–0.09% | ||||||||
Frontier Communications Corp. | 11,250 | 93,375 | ||||||
Internet & Direct Marketing Retail–1.19% | ||||||||
PetMed Express, Inc.(b) | 33,850 | 1,132,621 | ||||||
Qurate Retail Group, Inc.–Class A | 5,950 | 139,289 | ||||||
1,271,910 | ||||||||
Internet Software & Services–3.14% | ||||||||
Blucora, Inc. | 14,950 | 388,700 | ||||||
Care.com, Inc. | 38,550 | 601,380 | ||||||
eGain Corp. | 37,750 | 326,538 | ||||||
QuinStreet, Inc. | 62,550 | 703,062 | ||||||
Stamps.com, Inc. | 1,200 | 273,300 | ||||||
Twitter, Inc.(b) | 35,350 | 1,071,458 | ||||||
3,364,438 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco All Cap Market Neutral Fund
Shares | Value | |||||||
IT Consulting & Other Services–0.32% | ||||||||
Teradata Corp. | 3,650 | $ | 149,358 | |||||
Unisys Corp.(b) | 17,650 | 197,680 | ||||||
347,038 | ||||||||
Leisure Facilities–0.32% | ||||||||
Town Sports International Holdings, Inc.(b) | 37,000 | 344,100 | ||||||
Leisure Products–0.17% | ||||||||
Johnson Outdoors Inc.–Class A(b) | 2,800 | 181,328 | ||||||
Life Sciences Tools & Services–0.33% | ||||||||
Codexis, Inc. | 4,350 | 48,938 | ||||||
Fluidigm Corp. | 51,550 | 304,145 | ||||||
353,083 | ||||||||
Managed Health Care–0.17% | ||||||||
Triple-S Management Corp.–Class B (Puerto Rico)(b) | 6,350 | 180,023 | ||||||
Marine–0.10% | ||||||||
Genco Shipping & Trading Ltd.(b) | 7,000 | 112,000 | ||||||
Metal & Glass Containers–0.10% | ||||||||
Myers Industries, Inc. | 4,700 | 109,510 | ||||||
Oil & Gas Drilling–1.88% | ||||||||
Diamond Offshore Drilling, Inc. | 54,500 | 1,002,255 | ||||||
Noble Corp. PLC | 91,600 | 427,772 | ||||||
Rowan Cos. PLC–Class A | 40,450 | 584,098 | ||||||
2,014,125 | ||||||||
Oil & Gas Equipment & Services–0.49% | ||||||||
ION Geophysical Corp. | 18,450 | 531,360 | ||||||
Oil & Gas Exploration & Production–6.47% | ||||||||
Bonanza Creek Energy, Inc. | 7,300 | 221,409 | ||||||
California Resources Corp.(b) | 30,700 | 781,315 | ||||||
CNX Resources, Corp. | 50,400 | 748,944 | ||||||
Comstock Resources, Inc. | 21,450 | 148,648 | ||||||
Enerplus Corp. (Canada) | 106,200 | 1,232,982 | ||||||
Evolution Petroleum Corp. | 55,700 | 518,010 | ||||||
Marathon Oil Corp. | 41,100 | 750,075 | ||||||
Murphy Oil Corp. | 5,000 | 150,550 | ||||||
Panhandle Oil & Gas, Inc.–Class A(b) | 14,400 | 280,080 | ||||||
W&T Offshore, Inc. | 198,100 | 1,208,410 | ||||||
Whiting Petroleum Corp.(b) | 22,050 | 900,081 | ||||||
6,940,504 | ||||||||
Oil & Gas Refining & Marketing–1.06% | ||||||||
Adams Resources & Energy, Inc. | 4,000 | 183,200 | ||||||
HollyFrontier Corp.(b) | 15,750 | 955,868 | ||||||
1,139,068 | ||||||||
Oil & Gas Storage & Transportation–0.57% | ||||||||
Overseas Shipholding Group, Inc.–Class A | 59,250 | 221,003 | ||||||
Teekay Corp. (Bermuda) | 44,300 | 390,726 | ||||||
611,729 |
Shares | Value | |||||||
Packaged Foods & Meats–0.22% | ||||||||
Sanderson Farms, Inc. | 2,100 | $ | 233,436 | |||||
Paper Products–0.76% | ||||||||
Verso Corp.–Class A | 44,900 | 810,894 | ||||||
Personal Products–1.17% | ||||||||
Medifast, Inc. | 12,550 | 1,259,769 | ||||||
Pharmaceuticals–8.75% | ||||||||
Assembly Biosciences, Inc. | 27,450 | 1,193,526 | ||||||
Corcept Therapeutics Inc. | 86,850 | 1,448,658 | ||||||
Cymabay Therapeutics, Inc. | 15,950 | 185,498 | ||||||
Endo International PLC(b) | 78,000 | 446,940 | ||||||
Endocyte, Inc. | 86,900 | 831,633 | ||||||
Innoviva, Inc. | 105,100 | 1,523,950 | ||||||
Intersect ENT, Inc. | 37,300 | 1,490,135 | ||||||
MyoKardia, Inc. | 29,150 | 1,440,010 | ||||||
Supernus Pharmaceuticals Inc. | 14,950 | 701,155 | ||||||
Zogenix, Inc.(b) | 3,150 | 123,795 | ||||||
9,385,300 | ||||||||
Real Estate Development–0.29% | ||||||||
Maui Land & Pineapple Co., Inc. | 29,050 | 309,383 | ||||||
Real Estate Services–0.53% | ||||||||
Altisource Asset Management Corp. | 2,625 | 173,250 | ||||||
Altisource Portfolio Solutions S.A. | 14,300 | 391,534 | ||||||
564,784 | ||||||||
Reinsurance–0.21% | ||||||||
Third Point Reinsurance Ltd. (Bermuda)(b) | 17,000 | 226,100 | ||||||
Research & Consulting Services–0.13% | ||||||||
RPX Corp. | 12,750 | 138,083 | ||||||
Residential REITs–0.09% | ||||||||
BRT Apartments Corp. | 8,150 | 98,534 | ||||||
Semiconductor Equipment–1.73% | ||||||||
Amtech Systems, Inc. | 18,100 | 125,433 | ||||||
SolarEdge Technologies, Inc. | 32,850 | 1,729,552 | ||||||
1,854,985 | ||||||||
Semiconductors–3.67% | ||||||||
Adesto Technologies Corp. | 21,450 | 193,050 | ||||||
First Solar, Inc. | 24,100 | 1,708,931 | ||||||
Micron Technology, Inc.(b) | 39,900 | 1,834,602 | ||||||
Pixelworks, Inc.(b) | 45,800 | 196,024 | ||||||
3,932,607 | ||||||||
Specialized Consumer Services–2.35% | ||||||||
H&R Block, Inc. | �� | 25,800 | 713,370 | |||||
Liberty Tax, Inc. | 4,950 | 50,985 | ||||||
Weight Watchers International, Inc. | 25,100 | 1,758,255 | ||||||
2,522,610 | ||||||||
Specialized REITs–1.46% | ||||||||
CoreCivic, Inc. | 41,150 | 829,584 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco All Cap Market Neutral Fund
Shares | Value | |||||||
Specialized REITs–(continued) | ||||||||
SBA Communications Corp.(b) | 4,600 | $ | 737,058 | |||||
1,566,642 | ||||||||
Specialty Stores–1.09% | ||||||||
GNC Holdings, Inc.–Class A(b) | 111,800 | 396,890 | ||||||
Hibbett Sports, Inc.(b) | 28,550 | 776,560 | ||||||
1,173,450 | ||||||||
Technology Distributors–1.29% | ||||||||
Systemax, Inc. | 44,150 | 1,387,634 | ||||||
Technology Hardware, Storage & Peripherals–0.50% | ||||||||
Avid Technology, Inc. | 25,150 | 112,672 | ||||||
Pure Storage, Inc.–Class A | 2,750 | 55,633 | ||||||
Quantum Corp. | 44,100 | 172,872 | ||||||
Western Digital Corp.(b) | 2,450 | 193,035 | ||||||
534,212 | ||||||||
Thrifts & Mortgage Finance–1.95% | ||||||||
Charter Financial Corp.(b) | 5,900 | 137,234 | ||||||
Federal Agricultural Mortgage Corp.–Class C | 17,000 | 1,453,670 | ||||||
FS Bancorp, Inc. | 2,300 | 132,434 | ||||||
Walker & Dunlop, Inc. | 6,500 | 371,215 | ||||||
2,094,553 | ||||||||
Tobacco–0.23% | ||||||||
Alliance One International, Inc. | 11,700 | 244,530 |
Shares | Value | |||||||
Trading Companies & Distributors–1.79% | ||||||||
H&E Equipment Services, Inc. | 11,800 | $ | 381,730 | |||||
Textainer Group Holdings Ltd. | 66,050 | 1,136,060 | ||||||
Titan Machinery, Inc. | 16,650 | 321,678 | ||||||
W.W. Grainger, Inc.(b) | 300 | 84,405 | ||||||
1,923,873 | ||||||||
Trucking–1.02% | ||||||||
Avis Budget Group, Inc. | 16,350 | 807,854 | ||||||
USA Truck, Inc. | 11,800 | 283,554 | ||||||
1,091,408 | ||||||||
Total Common Stocks & Other Equity Interests |
| 101,394,999 | ||||||
Money Market Funds–11.24% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(c) | 4,220,390 | 4,220,390 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(c) | 3,013,939 | 3,014,240 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(c) | 4,823,302 | 4,823,302 | ||||||
Total Money Market Funds | 12,057,932 | |||||||
TOTAL INVESTMENTS IN SECURITIES–105.75% |
| 113,452,931 | ||||||
OTHER ASSETS LESS LIABILITIES–(5.75)% |
| (6,169,424 | ) | |||||
NET ASSETS–100.00% | $ | 107,283,507 |
Investment Abbreviations:
REIT | — Real Estate Investment Trust |
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
Open Over-The-Counter Total Return Swap Agreements — Equity Risk | ||||||||||||||||||||||||||||||||||||
Reference Entity | Counterparty | Maturity Dates | Floating Rate Index(1) | Payment Frequency | Notional Amount | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation) | Net Value of Reference Entities | |||||||||||||||||||||||||||
Equity Securities — Short | Morgan Stanley & Co. LLC | 04/24/2019 | | Federal Funds floating rate | | Monthly | $ | (101,853,887 | ) | $ | — | $ | (34,135 | )(2)(3) | $ | (34,135 | )(2)(3) | $ | (101,858,801 | ) |
(1) | The Fund receives or pays the total return on the long and short positions underlying the total return swap and pays or receives a specific Federal Funds floating rate. |
(2) | Amount includes $(29,221) of dividends payable and financing fees related to the reference entities. |
(3) | Swaps are collaterized by $22,383 cash held with Morgan Stanley & Co. LLC, the Counterparty. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco All Cap Market Neutral Fund
The following table represents the individual short positions and related values of equity securities underlying the total return swap with Morgan Stanley & Co. LLC, as of April 30, 2018.
Shares | Value | Percentage of Reference Entities | ||||||||||
Equity Securities — Short |
| |||||||||||
Advertising | ||||||||||||
Fluent, Inc. | (2,534 | ) | $ | (6,969 | ) | (0.01 | ) | |||||
Aerospace & Defense | ||||||||||||
KeyW Holding Corp. (The) | (64,250 | ) | (497,295 | ) | (0.52 | ) | ||||||
Wesco Aircraft Holdings, Inc. | (67,250 | ) | (679,225 | ) | (0.72 | ) | ||||||
(1,176,520 | ) | |||||||||||
Air Freight & Logistics | ||||||||||||
Radiant Logistics, Inc. | (42,900 | ) | (151,437 | ) | (0.16 | ) | ||||||
Airlines | ||||||||||||
Allegiant Travel Co. | (2,200 | ) | (352,550 | ) | (0.31 | ) | ||||||
Spirit Airlines, Inc. | (9,000 | ) | (321,480 | ) | (0.34 | ) | ||||||
(674,030 | ) | |||||||||||
Apparel Retail | ||||||||||||
Francesca’s Holdings Corp. | (44,200 | ) | (218,790 | ) | (0.21 | ) | ||||||
Genesco, Inc. | (4,950 | ) | (211,612 | ) | (0.20 | ) | ||||||
(430,402 | ) | |||||||||||
Apparel, Accessories & Luxury Goods | ||||||||||||
Under Armour, Inc.–Class A | (55,350 | ) | (983,016 | ) | (0.91 | ) | ||||||
Under Armour, Inc.–Class C | (39,550 | ) | (607,093 | ) | (0.57 | ) | ||||||
(1,590,109 | ) | |||||||||||
Application Software | ||||||||||||
Asure Software, Inc. | (15,500 | ) | (234,670 | ) | (0.23 | ) | ||||||
Digimarc Corp. | (15,500 | ) | (447,175 | ) | (0.40 | ) | ||||||
Ellie Mae, Inc. | (12,550 | ) | (1,215,718 | ) | (1.11 | ) | ||||||
Park City Group, Inc. | (10,250 | ) | (80,975 | ) | (0.09 | ) | ||||||
PROS Holdings, Inc. | (4,700 | ) | (138,744 | ) | (0.15 | ) | ||||||
SITO Mobile Ltd. | (23,950 | ) | (80,951 | ) | (0.09 | ) | ||||||
(2,198,233 | ) | |||||||||||
Asset Management & Custody Banks | ||||||||||||
Safeguard Scientifics, Inc. | (6,900 | ) | (89,355 | ) | (0.08 | ) | ||||||
Auto Parts & Equipment | ||||||||||||
Horizon Global Corp. | (30,500 | ) | (227,835 | ) | (0.24 | ) | ||||||
Automobile Manufacturers | ||||||||||||
Tesla, Inc. | (4,260 | ) | (1,252,014 | ) | (1.19 | ) | ||||||
Automotive Retail | ||||||||||||
Advance Auto Parts, Inc. | (9,250 | ) | (1,058,662 | ) | (0.96 | ) | ||||||
CarMax, Inc. | (17,100 | ) | (1,068,750 | ) | (1.03 | ) | ||||||
Lithia Motors, Inc.–Class A | (450 | ) | (43,137 | ) | (0.04 | ) | ||||||
Monro, Inc. | (7,350 | ) | (411,232 | ) | (0.39 | ) | ||||||
Sonic Automotive, Inc.–Class A | (3,900 | ) | (77,220 | ) | (0.08 | ) | ||||||
(2,659,001 | ) |
Shares | Value | Percentage of Reference Entities | ||||||||||
Biotechnology | ||||||||||||
ACADIA Pharmaceuticals Inc. | (45,750 | ) | $ | (723,307 | ) | (0.89 | ) | |||||
ADMA Biologics, Inc. | (52,450 | ) | (260,676 | ) | (0.26 | ) | ||||||
Advaxis, Inc. | (48,550 | ) | (77,680 | ) | (0.08 | ) | ||||||
Agios Pharmaceuticals, Inc. | (850 | ) | (71,324 | ) | (0.07 | ) | ||||||
Aldeyra Therapeutics, Inc. | (16,800 | ) | (131,880 | ) | (0.12 | ) | ||||||
Bellicum Pharmaceuticals, Inc. | (36,600 | ) | (244,854 | ) | (0.26 | ) | ||||||
bluebird bio, Inc. | (350 | ) | (59,553 | ) | (0.06 | ) | ||||||
Cara Therapeutics, Inc. | (6,100 | ) | (75,518 | ) | (0.07 | ) | ||||||
Clovis Oncology, Inc. | (14,000 | ) | (607,320 | ) | (0.66 | ) | ||||||
Coherus Biosciences, Inc. | (80,000 | ) | (968,000 | ) | (0.93 | ) | ||||||
Corbus Pharmaceuticals Holdings, Inc. | (66,500 | ) | (395,675 | ) | (0.43 | ) | ||||||
Eiger BioPharmaceuticals, Inc. | (4,000 | ) | (35,200 | ) | (0.04 | ) | ||||||
Flexion Therapeutics, Inc. | (26,250 | ) | (654,150 | ) | (0.63 | ) | ||||||
Intercept Pharmaceuticals, Inc. | (9,200 | ) | (625,692 | ) | (0.61 | ) | ||||||
Intrexon Corp. | (7,250 | ) | (131,805 | ) | (0.13 | ) | ||||||
Invitae Corp. | (44,150 | ) | (244,149 | ) | (0.24 | ) | ||||||
Nymox Pharmaceutical Corp. (Canada) | (11,850 | ) | (48,467 | ) | (0.05 | ) | ||||||
Portola Pharmaceuticals, Inc. | (18,000 | ) | (650,340 | ) | (0.59 | ) | ||||||
Radius Health, Inc. | (25,650 | ) | (774,630 | ) | (0.83 | ) | ||||||
Sage Therapeutics, Inc. | (5,600 | ) | (805,952 | ) | (0.80 | ) | ||||||
TESARO, Inc. | (21,400 | ) | (1,089,474 | ) | (1.09 | ) | ||||||
Tyme Technologies, Inc. | (106,700 | ) | (244,343 | ) | (0.23 | ) | ||||||
Ultragenyx Pharmaceutical Inc. | (19,700 | ) | (1,001,548 | ) | (1.04 | ) | ||||||
(9,921,537 | ) | |||||||||||
Building Products | ||||||||||||
Johnson Controls International PLC | (15,100 | ) | (511,437 | ) | (0.51 | ) | ||||||
Casinos & Gaming | ||||||||||||
Empire Resorts, Inc. | (8,135 | ) | (154,972 | ) | (0.16 | ) | ||||||
Commodity Chemicals | ||||||||||||
Loop Industries, Inc. | (8,800 | ) | (114,400 | ) | (0.12 | ) | ||||||
Trecora Resources | (12,050 | ) | (156,048 | ) | (0.16 | ) | ||||||
(270,448 | ) | |||||||||||
Communications Equipment | ||||||||||||
Infinera Corp. | (130,450 | ) | (1,528,874 | ) | (1.47 | ) | ||||||
Construction Machinery & Heavy Trucks | ||||||||||||
Wabtec Corp. | (16,850 | ) | (1,496,449 | ) | (1.46 | ) | ||||||
Construction Materials | ||||||||||||
Forterra, Inc. | (85,700 | ) | (629,038 | ) | (0.74 | ) | ||||||
Martin Marietta Materials, Inc. | (250 | ) | (48,693 | ) | (0.05 | ) | ||||||
Vulcan Materials Co. | (800 | ) | (89,352 | ) | (0.09 | ) | ||||||
(767,083 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco All Cap Market Neutral Fund
Shares | Value | Percentage of Reference Entities | ||||||||||
Consumer Electronics | ||||||||||||
Universal Electronics, Inc. | (7,450 | ) | $ | (344,935 | ) | (0.36 | ) | |||||
Data Processing & Outsourced Services | ||||||||||||
Square, Inc.–Class A | (3,300 | ) | (156,222 | ) | (0.16 | ) | ||||||
Distributors | ||||||||||||
Core-Mark Holding Co., Inc. | (46,400 | ) | (956,304 | ) | (0.95 | ) | ||||||
LKQ Corp. | (7,700 | ) | (238,854 | ) | (0.29 | ) | ||||||
Pool Corp. | (3,000 | ) | (416,430 | ) | (0.41 | ) | ||||||
(1,611,588 | ) | |||||||||||
Diversified Chemicals | ||||||||||||
LSB Industries, Inc. | (35,750 | ) | (197,697 | ) | (0.21 | ) | ||||||
Diversified Metals & Mining | ||||||||||||
Compass Minerals International, Inc. | (13,000 | ) | (874,900 | ) | (0.87 | ) | ||||||
Diversified Support Services | ||||||||||||
Ritchie Bros. Auctioneers Inc. (Canada) | (28,850 | ) | (944,261 | ) | (0.94 | ) | ||||||
Education Services | ||||||||||||
Career Education Corp. | (4,550 | ) | (59,014 | ) | (0.06 | ) | ||||||
Electric Utilities | ||||||||||||
NextEra Energy, Inc. | (350 | ) | (57,369 | ) | (0.06 | ) | ||||||
Electrical Components & Equipment | ||||||||||||
American Superconductor Corp. | (27,275 | ) | (160,922 | ) | (0.17 | ) | ||||||
Revolution Lighting Technologies, Inc. | (23,350 | ) | (83,126 | ) | (0.08 | ) | ||||||
Sunrun Inc. | (139,850 | ) | (1,289,417 | ) | (1.21 | ) | ||||||
Vivint Solar, Inc. | (48,300 | ) | (190,785 | ) | (0.19 | ) | ||||||
(1,724,250 | ) | |||||||||||
Electronic Components | ||||||||||||
Akoustis Technologies, Inc. | (26,200 | ) | (132,834 | ) | (0.13 | ) | ||||||
II-VI, Inc. | (23,600 | ) | (899,160 | ) | (0.94 | ) | ||||||
Universal Display Corp. | (6,350 | ) | (559,117 | ) | (0.57 | ) | ||||||
(1,591,111 | ) | |||||||||||
Electronic Equipment & Instruments | ||||||||||||
Iteris, Inc. | (42,250 | ) | (214,207 | ) | (0.21 | ) | ||||||
Electronic Manufacturing Services | ||||||||||||
Fabrinet (Thailand) | (18,000 | ) | (507,780 | ) | (0.53 | ) | ||||||
Maxwell Technologies, Inc. | (50,050 | ) | (256,756 | ) | (0.27 | ) | ||||||
(764,536 | ) | |||||||||||
Environmental & Facilities Services | ||||||||||||
Team, Inc. | (38,200 | ) | (647,490 | ) | (0.64 | ) | ||||||
Food Retail | ||||||||||||
Natural Grocers by Vitamin Cottage, Inc. | (21,900 | ) | (156,585 | ) | (0.16 | ) | ||||||
Footwear | ||||||||||||
NIKE, Inc.–Class B | (1,550 | ) | (106,005 | ) | (0.10 | ) |
Shares | Value | Percentage of Reference Entities | ||||||||||
General Merchandise Stores | ||||||||||||
Fred’s, Inc.–Class A | (12,700 | ) | $ | (30,417 | ) | (0.04 | ) | |||||
Tuesday Morning Corp. | (53,550 | ) | (190,103 | ) | (0.21 | ) | ||||||
(220,520 | ) | |||||||||||
Gold | ||||||||||||
Tahoe Resources Inc. | (90,950 | ) | (457,479 | ) | (0.45 | ) | ||||||
Health Care Equipment | ||||||||||||
ConforMIS Inc. | (42,000 | ) | (54,390 | ) | (0.07 | ) | ||||||
CytoSorbents Corp. | (34,100 | ) | (257,455 | ) | (0.25 | ) | ||||||
DexCom, Inc. | (20,450 | ) | (1,496,531 | ) | (1.47 | ) | ||||||
GenMark Diagnostics Inc. | (72,200 | ) | (451,972 | ) | (0.44 | ) | ||||||
Invacare Corp. | (40,250 | ) | (732,550 | ) | (0.75 | ) | ||||||
Invuity, Inc. | (22,050 | ) | (72,765 | ) | (0.08 | ) | ||||||
K2M Group Holdings, Inc. | (3,700 | ) | (70,670 | ) | (0.07 | ) | ||||||
Nevro Corp. | (11,750 | ) | (1,049,980 | ) | (1.03 | ) | ||||||
NuVasive, Inc. | (18,700 | ) | (995,027 | ) | (0.97 | ) | ||||||
Oxford Immunotec Global PLC | (32,750 | ) | (420,183 | ) | (0.40 | ) | ||||||
Penumbra, Inc. | (6,100 | ) | (758,535 | ) | (0.74 | ) | ||||||
Pulse Biosciences, Inc. | (22,450 | ) | (394,896 | ) | (0.39 | ) | ||||||
Tandem Diabetes Care, Inc. | (59,600 | ) | (454,748 | ) | (0.43 | ) | ||||||
ViewRay Inc. | (92,500 | ) | (682,650 | ) | (0.70 | ) | ||||||
Viveve Medical, Inc. | (26,000 | ) | (89,440 | ) | (0.08 | ) | ||||||
Wright Medical Group N.V. | (41,200 | ) | (807,932 | ) | (0.78 | ) | ||||||
(8,789,724 | ) | |||||||||||
Health Care Services | ||||||||||||
Envision Healthcare Corp. | (8,450 | ) | (314,086 | ) | (0.31 | ) | ||||||
Health Care Supplies | ||||||||||||
Endologix, Inc. | (105,450 | ) | (454,489 | ) | (0.43 | ) | ||||||
Quotient Ltd. | (55,950 | ) | (233,312 | ) | (0.22 | ) | ||||||
(687,801 | ) | |||||||||||
Health Care Technology | ||||||||||||
Evolent Health, Inc.–Class A | (25,250 | ) | (416,625 | ) | (0.41 | ) | ||||||
Heavy Electrical Equipment | ||||||||||||
Babcock & Wilcox Enterprises, Inc. | (53,800 | ) | (122,664 | ) | (0.13 | ) | ||||||
Home Improvement Retail | ||||||||||||
Tile Shop Holdings, Inc. | (68,300 | ) | (467,855 | ) | (0.43 | ) | ||||||
Homebuilding | ||||||||||||
New Home Co. Inc. (The) | (9,950 | ) | (99,301 | ) | (0.10 | ) | ||||||
Homefurnishing Retail | ||||||||||||
At Home Group, Inc. | (3,350 | ) | (117,886 | ) | (0.11 | ) | ||||||
Hotels, Resorts & Cruise Lines | ||||||||||||
Marriott International Inc.–Class A | (650 | ) | (88,842 | ) | (0.09 | ) | ||||||
Red Lion Hotels Corp. | (9,400 | ) | (92,590 | ) | (0.09 | ) | ||||||
(181,432 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco All Cap Market Neutral Fund
Shares | Value | Percentage of Reference Entities | ||||||||||
Housewares & Specialties | ||||||||||||
Newell Brands Inc. | (56,900 | ) | $ | (1,572,147 | ) | (1.48 | ) | |||||
Hypermarkets & Super Centers | ||||||||||||
PriceSmart, Inc. | (2,200 | ) | (192,720 | ) | (0.19 | ) | ||||||
Independent Power Producers & Energy Traders | ||||||||||||
Algonquin Power & Utilities Corp. (Canada) | (5,200 | ) | (50,648 | ) | (0.05 | ) | ||||||
Industrial Machinery | ||||||||||||
CIRCOR International, Inc. | (3,200 | ) | (135,584 | ) | (0.14 | ) | ||||||
Energy Recovery, Inc. | (8,500 | ) | (72,165 | ) | (0.07 | ) | ||||||
ExOne Co. (The) | (20,000 | ) | (138,400 | ) | (0.15 | ) | ||||||
(346,149 | ) | |||||||||||
Integrated Telecommunication Services | ||||||||||||
IDT Corp.–Class B | (23,950 | ) | (129,809 | ) | (0.13 | ) | ||||||
Internet & Direct Marketing Retail | ||||||||||||
Duluth Holdings, Inc.–Class B | (39,750 | ) | (689,662 | ) | (0.70 | ) | ||||||
Wayfair, Inc.–Class A | (22,150 | ) | (1,379,945 | ) | (1.59 | ) | ||||||
(2,069,607 | ) | |||||||||||
Internet Software & Services | ||||||||||||
Benefitfocus, Inc. | (5,250 | ) | (158,550 | ) | (0.14 | ) | ||||||
Instructure, Inc. | (2,450 | ) | (99,348 | ) | (0.10 | ) | ||||||
Liquidity Services, Inc. | (41,250 | ) | (266,062 | ) | (0.25 | ) | ||||||
MercadoLibre Inc. (Argentina) | (380 | ) | (129,052 | ) | (0.12 | ) | ||||||
Nutanix, Inc.–Class A | (1,800 | ) | (91,062 | ) | (0.10 | ) | ||||||
Pandora Media, Inc. | (98,550 | ) | (552,866 | ) | (0.51 | ) | ||||||
Shopify, Inc. (Canada)–Class A | (10,800 | ) | (1,443,204 | ) | (1.30 | ) | ||||||
(2,740,144 | ) | |||||||||||
Leisure Products | ||||||||||||
American Outdoor Brands Corp. | (19,450 | ) | (213,950 | ) | (0.22 | ) | ||||||
Life Sciences Tools & Services | ||||||||||||
NanoString Technologies, Inc. | (30,600 | ) | (290,700 | ) | (0.27 | ) | ||||||
Marine | ||||||||||||
Matson, Inc. | (11,600 | ) | (339,068 | ) | (0.33 | ) | ||||||
Movies & Entertainment | ||||||||||||
AMC Entertainment Holdings, Inc.–Class A | (66,050 | ) | (1,152,572 | ) | (1.11 | ) | ||||||
Global Eagle Entertainment Inc. | (96,500 | ) | (112,905 | ) | (0.11 | ) | ||||||
IMAX Corp. | (10,250 | ) | (237,800 | ) | (0.23 | ) | ||||||
(1,503,277 | ) | |||||||||||
Oil & Gas Equipment & Services | ||||||||||||
Basic Energy Services, Inc. | (15,800 | ) | (255,644 | ) | (0.25 | ) | ||||||
Forum Energy Technologies, Inc. | (36,600 | ) | (461,160 | ) | (0.44 | ) | ||||||
Frank’s International N.V. | (40,800 | ) | (285,192 | ) | (0.27 | ) | ||||||
Gulf Island Fabrication, Inc. | (19,000 | ) | (190,000 | ) | (0.18 | ) | ||||||
Key Energy Services, Inc. | (26,450 | ) | (423,993 | ) | (0.39 | ) | ||||||
Smart Sand, Inc. | (10,200 | ) | (74,664 | ) | (0.07 | ) | ||||||
(1,690,653 | ) |
Shares | Value | Percentage of Reference Entities | ||||||||||
Oil & Gas Exploration & Production | ||||||||||||
Callon Petroleum Co. | (74,150 | ) | $ | (1,031,426 | ) | (1.04 | ) | |||||
Centennial Resource Development, Inc.–Class A | (29,900 | ) | (553,150 | ) | (0.56 | ) | ||||||
Diamondback Energy Inc. | (3,350 | ) | (430,307 | ) | (0.42 | ) | ||||||
Energy XXI Gulf Coast, Inc. | (44,200 | ) | (255,476 | ) | (0.25 | ) | ||||||
Extraction Oil & Gas, Inc. | (45,950 | ) | (648,814 | ) | (0.63 | ) | ||||||
Gulfport Energy Corp. | (62,800 | ) | (584,040 | ) | (0.55 | ) | ||||||
Lilis Energy, Inc. | (81,800 | ) | (337,834 | ) | (0.32 | ) | ||||||
Parsley Energy Inc.–Class A | (50,700 | ) | (1,522,521 | ) | (1.52 | ) | ||||||
Resolute Energy Corp. | (30,750 | ) | (1,026,743 | ) | (0.97 | ) | ||||||
Ring Energy, Inc. | (18,300 | ) | (305,976 | ) | (0.31 | ) | ||||||
Sanchez Energy Corp. | (75,650 | ) | (232,246 | ) | (0.23 | ) | ||||||
(6,928,533 | ) | |||||||||||
Oil & Gas Refining & Marketing | ||||||||||||
Amyris, Inc. | (35,050 | ) | (231,680 | ) | (0.22 | ) | ||||||
Green Plains, Inc. | (51,800 | ) | (963,480 | ) | (0.90 | ) | ||||||
(1,195,160 | ) | |||||||||||
Oil & Gas Storage & Transportation | ||||||||||||
Cheniere Energy, Inc. | (6,850 | ) | (398,396 | ) | (0.39 | ) | ||||||
Enbridge, Inc. (Canada) | (19,550 | ) | (591,778 | ) | (0.60 | ) | ||||||
Frontline Ltd. (Norway) | (120,000 | ) | (519,600 | ) | (0.57 | ) | ||||||
Targa Resources Corp. | (7,050 | ) | (331,139 | ) | (0.33 | ) | ||||||
(1,840,913 | ) | |||||||||||
Paper Products | ||||||||||||
Clearwater Paper Corp. | (2,050 | ) | (48,483 | ) | (0.05 | ) | ||||||
P.H. Glatfelter Co. | (2,650 | ) | (55,359 | ) | (0.06 | ) | ||||||
(103,842 | ) | |||||||||||
Personal Products | ||||||||||||
Coty Inc.–Class A | (71,950 | ) | (1,248,332 | ) | (1.18 | ) | ||||||
Revlon, Inc.–Class A | (15,350 | ) | (349,980 | ) | (0.34 | ) | ||||||
(1,598,312 | ) | |||||||||||
Pharmaceuticals | ||||||||||||
Aclaris Therapeutics, Inc. | (2,800 | ) | (49,700 | ) | (0.05 | ) | ||||||
Aerie Pharmaceuticals, Inc. | (15,100 | ) | (773,120 | ) | (0.81 | ) | ||||||
Axsome Therapeutics, Inc. | (23,550 | ) | (80,070 | ) | (0.06 | ) | ||||||
Collegium Pharmaceutical, Inc. | (3,350 | ) | (79,228 | ) | (0.08 | ) | ||||||
Intra-Cellular Therapies, Inc. | (34,550 | ) | (601,861 | ) | (0.66 | ) | ||||||
Johnson & Johnson | (4,550 | ) | (575,529 | ) | (0.57 | ) | ||||||
Medicines Co. (The) | (28,250 | ) | (850,042 | ) | (0.81 | ) | ||||||
Ocular Therapeutix, Inc. | (48,100 | ) | (302,549 | ) | (0.30 | ) | ||||||
Paratek Pharmaceuticals, Inc. | (38,200 | ) | (408,740 | ) | (0.41 | ) | ||||||
Pfizer, Inc. | (9,000 | ) | (329,490 | ) | (0.33 | ) | ||||||
Prestige Brands Holdings, Inc. | (14,400 | ) | (423,936 | ) | (0.43 | ) | ||||||
Reata Pharmaceuticals, Inc.–Class A | (34,050 | ) | (900,282 | ) | (0.85 | ) | ||||||
Revance Therapeutics, Inc. | (47,800 | ) | (1,336,010 | ) | (1.39 | ) | ||||||
TherapeuticsMD, Inc. | (123,650 | ) | (680,075 | ) | (0.69 | ) | ||||||
Theravance Biopharma, Inc. (Cayman Islands) | (4,000 | ) | (96,280 | ) | (0.09 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco All Cap Market Neutral Fund
Shares | Value | Percentage of Reference Entities | ||||||||||
Pharmaceuticals–(continued) | ||||||||||||
WaVe Life Sciences Ltd. | (20,500 | ) | $ | (911,225 | ) | (0.90 | ) | |||||
Zoetis, Inc. | (750 | ) | (62,610 | ) | (0.06 | ) | ||||||
(8,460,747 | ) | |||||||||||
Railroads | ||||||||||||
Canadian National Railway Co. (Canada) | (2,350 | ) | (181,608 | ) | (0.17 | ) | ||||||
Real Estate Operating Companies | ||||||||||||
Transcontinental Realty Investors, Inc. | (2,150 | ) | (94,256 | ) | (0.11 | ) | ||||||
Trinity Place Holdings, Inc. | (9,400 | ) | (61,570 | ) | (0.06 | ) | ||||||
(155,826 | ) | |||||||||||
Regional Banks | ||||||||||||
Banc of California, Inc. | (3,850 | ) | (73,920 | ) | (0.07 | ) | ||||||
First BanCorp. (Puerto Rico) | (73,250 | ) | (528,865 | ) | (0.49 | ) | ||||||
MidSouth Bancorp, Inc. | (19,450 | ) | (271,327 | ) | (0.26 | ) | ||||||
Republic First BanCorp., Inc. | (29,500 | ) | (244,850 | ) | (0.24 | ) | ||||||
(1,118,962 | ) | |||||||||||
Reinsurance | ||||||||||||
Maiden Holdings Ltd. | (103,650 | ) | (792,922 | ) | (0.80 | ) | ||||||
Research & Consulting Services | ||||||||||||
Willdan Group, Inc. | (10,850 | ) | (310,310 | ) | (0.32 | ) | ||||||
Restaurants | ||||||||||||
Chipotle Mexican Grill, Inc. | (4,480 | ) | (1,896,518 | ) | (1.45 | ) | ||||||
Fiesta Restaurant Group, Inc. | (15,800 | ) | (331,800 | ) | (0.30 | ) | ||||||
Habit Restaurants, Inc. (The)–Class A | (31,200 | ) | (315,120 | ) | (0.28 | ) | ||||||
Jamba, Inc. | (6,950 | ) | (65,469 | ) | (0.06 | ) | ||||||
Noodles & Co. | (25,600 | ) | (185,600 | ) | (0.19 | ) | ||||||
Papa John’s International, Inc. | (13,000 | ) | (806,000 | ) | (0.79 | ) | ||||||
Shake Shack Inc.–Class A | (1,350 | ) | (64,274 | ) | (0.06 | ) | ||||||
Zoe’s Kitchen, Inc. | (24,350 | ) | (359,163 | ) | (0.33 | ) | ||||||
(4,023,944 | ) | |||||||||||
Retail REITs | ||||||||||||
CBL & Associates Properties, Inc. | (215,300 | ) | (899,954 | ) | (0.81 | ) | ||||||
Pennsylvania Real Estate Investment Trust | (85,600 | ) | (828,608 | ) | (0.75 | ) | ||||||
(1,728,562 | ) | |||||||||||
Semiconductor Equipment | ||||||||||||
AXT, Inc. | (52,200 | ) | (305,370 | ) | (0.31 | ) | ||||||
Brooks Automation, Inc. | (2,250 | ) | (55,980 | ) | (0.06 | ) | ||||||
CyberOptics Corp. | (9,150 | ) | (139,537 | ) | (0.15 | ) | ||||||
PDF Solutions, Inc. | (41,000 | ) | (457,150 | ) | (0.45 | ) | ||||||
Photronics, Inc. | (18,450 | ) | (141,143 | ) | (0.14 | ) | ||||||
(1,099,180 | ) | |||||||||||
Semiconductors | ||||||||||||
Advanced Micro Devices Inc. | (151,000 | ) | (1,642,880 | ) | (1.49 | ) |
Shares | Value | Percentage of Reference Entities | ||||||||||
Semiconductors–(continued) | ||||||||||||
Alpha & Omega Semiconductor Ltd. | (8,600 | ) | $ | (130,376 | ) | (0.13 | ) | |||||
Analog Devices, Inc. | (4,500 | ) | (393,075 | ) | (0.39 | ) | ||||||
Cree, Inc. | (1,600 | ) | (59,712 | ) | (0.06 | ) | ||||||
Everspin Technologies, Inc. | (23,150 | ) | (158,114 | ) | (0.17 | ) | ||||||
GSI Technology, Inc. | (8,850 | ) | (64,871 | ) | (0.07 | ) | ||||||
Impinj, Inc. | (25,600 | ) | (314,624 | ) | (0.32 | ) | ||||||
Inphi Corp. | (18,400 | ) | (525,872 | ) | (0.55 | ) | ||||||
Integrated Device Technology, Inc. | (5,150 | ) | (143,324 | ) | (0.15 | ) | ||||||
MACOM Technology Solutions Holdings, Inc. | (24,300 | ) | (403,866 | ) | (0.40 | ) | ||||||
NeoPhotonics Corp. | (54,450 | ) | (279,873 | ) | (0.32 | ) | ||||||
Power Integrations, Inc. | (4,800 | ) | (325,440 | ) | (0.32 | ) | ||||||
Semtech Corp. | (10,950 | ) | (430,335 | ) | (0.45 | ) | ||||||
SunPower Corp. | (14,350 | ) | (122,406 | ) | (0.13 | ) | ||||||
(4,994,768 | ) | |||||||||||
Soft Drinks | ||||||||||||
Celsius Holdings, Inc. | (14,400 | ) | (76,176 | ) | (0.08 | ) | ||||||
Coca-Cola Co. (The) | (2,150 | ) | (92,902 | ) | (0.09 | ) | ||||||
(169,078 | ) | |||||||||||
Specialized Finance | ||||||||||||
On Deck Capital, Inc. | (82,150 | ) | (431,288 | ) | (0.43 | ) | ||||||
Specialty Chemicals | ||||||||||||
Advanced Emissions Solutions, Inc. | (25,350 | ) | (279,357 | ) | (0.28 | ) | ||||||
Albemarle Corp. | (3,650 | ) | (353,904 | ) | (0.34 | ) | ||||||
Flotek Industries, Inc. | (65,450 | ) | (233,656 | ) | (0.27 | ) | ||||||
Sherwin-Williams Co. (The) | (1,000 | ) | (367,660 | ) | (0.38 | ) | ||||||
(1,234,577 | ) | |||||||||||
Specialty Stores | ||||||||||||
Barnes & Noble, Inc. | (89,150 | ) | (494,782 | ) | �� | (0.49 | ) | |||||
Big 5 Sporting Goods Corp. | (26,100 | ) | (219,240 | ) | (0.22 | ) | ||||||
Build-A-Bear Workshop, Inc. | (11,250 | ) | (102,375 | ) | (0.10 | ) | ||||||
MarineMax, Inc. | (31,850 | ) | (687,960 | ) | (0.57 | ) | ||||||
Tiffany & Co. | (1,050 | ) | (107,972 | ) | (0.10 | ) | ||||||
Ulta Beauty Inc. | (6,500 | ) | (1,630,915 | ) | (1.51 | ) | ||||||
Vitamin Shoppe, Inc. | (27,250 | ) | (134,888 | ) | (0.13 | ) | ||||||
(3,378,132 | ) | |||||||||||
Steel | ||||||||||||
AK Steel Holding Corp. | (32,850 | ) | (150,781 | ) | (0.15 | ) | ||||||
Ampco-Pittsburgh Corp. | (12,550 | ) | (123,617 | ) | (0.13 | ) | ||||||
Haynes International, Inc. | (1,650 | ) | (68,987 | ) | (0.07 | ) | ||||||
Ramaco Resources, Inc. | (7,750 | ) | (52,933 | ) | (0.05 | ) | ||||||
(396,318 | ) | |||||||||||
Systems Software | ||||||||||||
SecureWorks Corp.–Class A | (33,250 | ) | (363,090 | ) | (0.35 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
12 Invesco All Cap Market Neutral Fund
Shares | Value | Percentage of Reference Entities | ||||||||||
Technology Distributors | ||||||||||||
PCM Inc. | (13,500 | ) | $ | (174,825 | ) | (0.14 | ) | |||||
Technology Hardware, Storage & Peripherals | ||||||||||||
3D Systems Corp. | (45,500 | ) | (456,820 | ) | (0.51 | ) | ||||||
Diebold Nixdorf, Inc. | (29,700 | ) | (455,895 | ) | (0.46 | ) | ||||||
Immersion Corp. | (35,800 | ) | (394,158 | ) | (0.39 | ) | ||||||
(1,306,873 | ) | |||||||||||
Thrifts & Mortgage Finance | ||||||||||||
Meta Financial Group, Inc. | (11,850 | ) | (1,317,127 | ) | (1.31 | ) |
Shares | Value | Percentage of Reference Entities | ||||||||||
Trading Companies & Distributors | ||||||||||||
EnviroStar, Inc. | (7,800 | ) | $ | (284,700 | ) | (0.28 | ) | |||||
Huttig Building Products, Inc. | (29,300 | ) | (181,953 | ) | (0.17 | ) | ||||||
NOW Inc. | (42,550 | ) | (516,131 | ) | (0.50 | ) | ||||||
(982,784 | ) | |||||||||||
Total Equity Securities — Short |
| $ | (101,858,801 | ) |
Portfolio Composition
By sector, based on total net assets
as of April 30, 2018
Equity Securities | Gross Exposure 3 | Net Exposure4 | ||||||||||||||
Long1 | Short2 | |||||||||||||||
Health Care | 28.2 | % | 26.9 | % | 55.1 | % | 1.3 | % | ||||||||
Consumer Discretionary | 19.0 | 20.8 | 39.8 | -1.8 | ||||||||||||
Information Technology | 16.3 | 16.0 | 32.3 | 0.3 | ||||||||||||
Energy | 11.6 | 10.9 | 22.5 | 0.7 | ||||||||||||
Industrials | 8.0 | 8.9 | 16.9 | -0.9 | ||||||||||||
Materials | 4.4 | 4.0 | 8.4 | 0.4 | ||||||||||||
Financials | 2.4 | 3.5 | 5.9 | -1.1 | ||||||||||||
Real Estate | 2.4 | 1.7 | 4.1 | 0.7 | ||||||||||||
Consumer Staples | 1.7 | 2.0 | 3.7 | -0.3 | ||||||||||||
Telecommunication Services | 0.3 | 0.1 | 0.4 | 0.2 | ||||||||||||
Utilities | 0.2 | 0.1 | 0.3 | 0.1 | ||||||||||||
Money Market Funds Plus Other Assets Less Liabilities | 5.5 | — | 5.5 | 5.5 | ||||||||||||
Total | 100.0 | % | 94.9 | % | 194.9 | % | 5.1 | % |
1 | Represents the value of the equity securities in the portfolio. |
2 | Represents the value of the equity securities underlying the Fund’s equity short portfolio swap. |
3 | Represents the cumulative exposure of the Fund’s long and short positions. |
4 | Represents the net exposure of the Fund’s long and short positions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
13 Invesco All Cap Market Neutral Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $89,182,325) | $ | 101,394,999 | ||
Investments in affiliated money market funds, at value | 12,057,932 | |||
Deposits with brokers: | ||||
Cash collateral — OTC derivatives | 22,383 | |||
Receivable for: | ||||
Investments sold | 73,127 | |||
Fund shares sold | 243,731 | |||
Dividends and interest | 32,098 | |||
Investment for trustee deferred compensation and retirement plans | 11,035 | |||
Other assets | 42,427 | |||
Total assets | 113,877,732 | |||
Liabilities: |
| |||
Other investments: | ||||
Swaps payable — OTC | 25,780 | |||
Unrealized depreciation on swap agreements — OTC | 34,135 | |||
Payable for: | ||||
Investments purchased | 118,930 | |||
Fund shares reacquired | 6,301,242 | |||
Amount due custodian | 31,240 | |||
Accrued fees to affiliates | 21,653 | |||
Accrued trustees’ and officers’ fees and benefits | 2,983 | |||
Accrued other operating expenses | 47,227 | |||
Trustee deferred compensation and retirement plans | 11,035 | |||
Total liabilities | 6,594,225 | |||
Net assets applicable to shares outstanding | $ | 107,283,507 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 102,113,276 | ||
Undistributed net investment income (loss) | (1,097,382 | ) | ||
Undistributed net realized gain (loss) | (5,911,052 | ) | ||
Net unrealized appreciation | 12,178,665 | |||
$ | 107,283,507 |
Net Assets: |
| |||
Class A | $ | 11,855,017 | ||
Class C | $ | 3,043,905 | ||
Class R | $ | 107,448 | ||
Class Y | $ | 28,540,180 | ||
Class R5 | $ | 8,602 | ||
Class R6 | $ | 63,728,355 | ||
Shares outstanding, no par value, |
| |||
Class A | 1,420,503 | |||
Class C | 377,951 | |||
Class R | 13,032 | |||
Class Y | 3,384,767 | |||
Class R5 | 1,018 | |||
Class R6 | 7,548,242 | |||
Class A: | ||||
Net asset value per share | $ | 8.35 | ||
Maximum offering price per share | ||||
(Net asset value of $8.35 ¸ 94.50%) | $ | 8.84 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 8.05 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 8.24 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 8.43 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 8.45 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 8.44 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
14 Invesco All Cap Market Neutral Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of foreign withholding taxes of $3,432) | $ | 417,925 | ||
Dividends from affiliated money market funds | 70,547 | |||
Total investment income | 488,472 | |||
Expenses: | ||||
Advisory fees | 510,322 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 8,632 | |||
Distribution fees: | ||||
Class A | 13,890 | |||
Class C | 18,786 | |||
Class R | 252 | |||
Transfer agent fees — A, C, R and Y | 35,505 | |||
Transfer agent fees — R6 | 204 | |||
Trustees’ and officers’ fees and benefits | 13,107 | |||
Registration and filing fees | 41,934 | |||
Reports to shareholders | 14,755 | |||
Professional services fees | 40,896 | |||
Other | 6,443 | |||
Total expenses | 729,521 | |||
Less: Fees waived and expense offset arrangement(s) | (6,608 | ) | ||
Net expenses | 722,913 | |||
Net investment income (loss) | (234,441 | ) | ||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | 7,692,794 | |||
Swap agreements | (13,354,190 | ) | ||
(5,661,396 | ) | |||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | (278,610 | ) | ||
Foreign currencies | (10 | ) | ||
Swap agreements | (890,434 | ) | ||
(1,169,054 | ) | |||
Net realized and unrealized gain (loss) | (6,830,450 | ) | ||
Net increase (decrease) in net assets resulting from operations | $ | (7,064,891 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
15 Invesco All Cap Market Neutral Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income (loss) | $ | (234,441 | ) | $ | (460,525 | ) | ||
Net realized gain (loss) | (5,661,396 | ) | 8,680,730 | |||||
Change in net unrealized appreciation (depreciation) | (1,169,054 | ) | (3,456,205 | ) | ||||
Net increase (decrease) in net assets resulting from operations | (7,064,891 | ) | 4,764,000 | |||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | (1,336,998 | ) | (23,299 | ) | ||||
Class C | (538,114 | ) | (5,884 | ) | ||||
Class R | (12,967 | ) | (63 | ) | ||||
Class Y | (4,735,077 | ) | (23,998 | ) | ||||
Class R5 | (1,189 | ) | (290 | ) | ||||
Class R6 | (8,552,565 | ) | (40,229 | ) | ||||
Total distributions from net realized gains | (15,176,910 | ) | (93,763 | ) | ||||
Share transactions-net: | ||||||||
Class A | 2,779,374 | (32,641,294 | ) | |||||
Class C | (1,003,749 | ) | (5,491,479 | ) | ||||
Class R | 17,538 | 3,532 | ||||||
Class Y | (5,384,227 | ) | (1,328,111 | ) | ||||
Class R5 | — | (484,975 | ) | |||||
Class R6 | 4,406,574 | (4,100,374 | ) | |||||
Net increase (decrease) in net assets resulting from share transactions | 815,510 | (44,042,701 | ) | |||||
Net increase (decrease) in net assets | (21,426,291 | ) | (39,372,464 | ) | ||||
Net assets: | ||||||||
Beginning of period | 128,709,798 | 168,082,262 | ||||||
End of period (includes undistributed net investment income (loss) of $(1,097,382) and $(862,941), respectively) | $ | 107,283,507 | $ | 128,709,798 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco All Cap Market Neutral Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to provide a positive return over a full market cycle from a broadly diversified portfolio of stocks while seeking to limit exposure to the general risks associated with stock market investing.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services – Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they
16 Invesco All Cap Market Neutral Fund
may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Dividend income and dividend expense on short sales are recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer |
17 Invesco All Cap Market Neutral Fund
derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
J. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
18 Invesco All Cap Market Neutral Fund
K. | Swap Agreements — The Fund may enter into various swap transactions, including interest rate, total return, volatility, variance, index, currency and credit default swap contracts (“CDS”) for investment purposes or to manage interest rate, equity, currency or credit risk. Such transactions are agreements between two parties (“Counterparties”). These agreements may contain among other conditions, events of default and termination events, and various covenants and representations such as provisions that require the Fund to maintain a pre-determined level of net assets, and/or provide limits regarding the decline of the Fund’s NAV over specific periods of time. If the Fund were to trigger such provisions and have open derivative positions at that time, the Counterparty may be able to terminate such agreement and request immediate payment in an amount equal to the net liability positions, if any. |
Interest rate, total return, volatility, variance, index, and currency swap agreements are two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a notional amount, i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate or return of an underlying asset, in a particular foreign currency, or in a “basket” of securities representing a particular index.
A total return swap is an agreement in which one party makes payments based on a set rate, either fixed or variable, while the other party makes payments based on the return of an underlying asset, which includes both the income generated and capital gains, if any. The unrealized appreciation (depreciation) on total return swaps includes dividends on the underlying equity securities and financing rate payable from the Counterparty. At the maturity date, a net cash flow is exchanged where the total return is equivalent to the return of the underlying reference less a financing rate, if any. As a receiver, the Fund would receive payments based on any positive total return and would owe payments in the event of a negative total return. As the payer, the Fund would owe payments on any net positive total return, and would receive payment in the event of a negative total return.
Changes in the value of swap agreements are recognized as unrealized gains (losses) in the Statement of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Statement of Assets and Liabilities and may be referred to as upfront payments. The Fund accrues for the fixed payment stream and amortizes upfront payments, if any, on swap agreements on a daily basis with the net amount, recorded as a component of realized gain (loss) on the Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Statement of Operations. The Fund segregates cash or liquid securities having a value at least equal to the amount of the potential obligation of a Fund under any swap transaction. Cash held as collateral is recorded as deposits with brokers on the Statement of Assets and Liabilities. Entering into these agreements involves, to varying degrees, lack of liquidity and elements of credit, market, and Counterparty risk in excess of amounts recognized on the Statement of Assets and Liabilities. Such risks involve the possibility that a swap is difficult to sell or liquidate; the Counterparty does not honor its obligations under the agreement and unfavorable interest rates and market fluctuations. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund’s exposure is unlimited.
L. | Leverage Risk — Leverage exists when the Fund can lose more than it originally invests because it purchases or sells an instrument or enters into a transaction without investing an amount equal to the full economic exposure of the instrument or transaction. |
M. | Collateral — To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund’s practice to replace such collateral no later than the next business day. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $250 million | 0.85% | |||
Next $250 million | 0.82% | |||
Next $500 million | 0.80% | |||
Next $1.5 billion | 0.77% | |||
Next $2.5 billion | 0.75% | |||
Next $2.5 billion | 0.72% | |||
Next $2.5 billion | 0.70% | |||
Over $10 billion | 0.67% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.85%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.50%, 2.25%, 1.75%, 1.25%, 1.25% and 1.25%, respectively, of the Fund’s
19 Invesco All Cap Market Neutral Fund
average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $6,322.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $846 in front-end sales commissions from the sale of Class A shares and $298 and $186 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 – | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 – | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 – | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
20 Invesco All Cap Market Neutral Fund
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Common Stocks & Other Equity Interests | $ | 101,394,999 | $ | — | $ | — | $ | 101,394,999 | ||||||||
Money Market Funds | 12,057,932 | — | — | 12,057,932 | ||||||||||||
Total Investments in Securities | 113,452,931 | — | — | 113,452,931 | ||||||||||||
Other Investments — Liabilities* | ||||||||||||||||
Swap Agreements | — | (34,135 | ) | — | (34,135 | ) | ||||||||||
Total Investments | $ | 113,452,931 | $ | (34,135 | ) | $ | — | $ | 113,418,796 |
* | Unrealized appreciation (depreciation). |
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Statement of Assets and Liabilities.
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2018:
Value | ||||
Derivative Liabilities | Equity Risk | |||
Unrealized depreciation on swap agreements — OTC | $ | (34,135 | ) | |
Derivatives not subject to master netting agreements | — | |||
Total Derivative Liabilities subject to master netting agreements | $ | (34,135 | ) |
Offsetting Assets and Liabilities
The table below reflects the Fund’s exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of April 30, 2018.
Financial Derivative Assets | Financial Derivative Liabilities | Collateral (Received)/Pledged | ||||||||||||||||||||||
Counterparty | Swap Agreements | Swap Agreements | Net Value of Derivatives | Non-Cash | Cash | Net Amount | ||||||||||||||||||
Morgan Stanley & Co. LLC | $ | — | $ | (59,915 | ) | $ | (59,915 | ) | $ | — | $ | 22,383 | $ | (37,532 | ) |
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Statement of Operations | ||||
Equity Risk | ||||
Realized Gain (Loss): | ||||
Swap agreements | $ | (13,354,190 | ) | |
Change in Net Unrealized Appreciation (Depreciation): | ||||
Swap agreements | (890,434 | ) | ||
Total | $ | (14,244,624 | ) |
The table below summarizes the average notional value of swap agreements outstanding during the period.
Swap Agreements | ||||
Average notional value | $ | 91,571,000 |
21 Invesco All Cap Market Neutral Fund
NOTE 5—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $286.
NOTE 6—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Fund.
NOTE 7—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 8—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2017.
NOTE 9—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $72,134,044 and $94,721,543, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 15,944,074 | ||
Aggregate unrealized (depreciation) of investments | (4,822,213 | ) | ||
Net unrealized appreciation of investments | $ | 11,121,861 |
Cost of investments for tax purposes is $102,296,935.
22 Invesco All Cap Market Neutral Fund
NOTE 10—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 450,667 | $ | 3,957,856 | 450,565 | $ | 4,530,754 | ||||||||||
Class C | 9,567 | 81,341 | 58,328 | 578,322 | ||||||||||||
Class R | 1,623 | 13,723 | 3,876 | 38,742 | ||||||||||||
Class Y | 598,624 | 5,417,213 | 3,880,773 | 39,331,445 | ||||||||||||
Class R6 | 1,095,701 | 9,609,117 | 941,211 | 9,425,954 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 158,230 | 1,335,467 | 1,971 | 20,639 | ||||||||||||
Class C | 65,856 | 537,385 | 573 | 5,875 | ||||||||||||
Class R | 1,414 | 11,798 | 6 | 57 | ||||||||||||
Class Y | 555,587 | 4,733,602 | 2,159 | 22,736 | ||||||||||||
Class R6 | 1,003,683 | 8,551,375 | 3,792 | 39,939 | ||||||||||||
Reacquired: | ||||||||||||||||
Class A | (288,872 | ) | (2,513,949 | ) | (3,693,539 | ) | (37,192,687 | ) | ||||||||
Class C | (193,105 | ) | (1,622,475 | ) | (618,543 | ) | (6,075,676 | ) | ||||||||
Class R | (968 | ) | (7,983 | ) | (3,557 | ) | (35,267 | ) | ||||||||
Class Y | (1,795,034 | ) | (15,535,042 | ) | (4,055,298 | ) | (40,682,292 | ) | ||||||||
Class R5 | — | — | (48,983 | ) | (484,975 | ) | ||||||||||
Class R6 | (1,616,517 | ) | (13,753,918 | ) | (1,336,039 | ) | (13,566,267 | ) | ||||||||
Net increase (decrease) in share activity | 46,456 | $ | 815,510 | (4,412,705 | ) | $ | (44,042,701 | ) |
(a) | There is an entity that is a record owner of more than 5% of the outstanding shares of the Fund and owns 19% of the outstanding shares of the Fund. IDI has an agreement with this entity to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to this entity, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by this entity are also owned beneficially. |
In addition, 59% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser. |
23 Invesco All Cap Market Neutral Fund
NOTE 11—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average | Ratio of expenses to average short sales without fee and/or | Ratio of expenses to average net assets short sales and/or absorbed | Ratio of expenses to average absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||||||||
Class A |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 10.07 | $ | (0.03 | ) | $ | (0.52 | ) | $ | (0.55 | ) | $ | — | $ | (1.17 | ) | $ | (1.17 | ) | $ | 8.35 | (5.60 | )% | $ | 11,855 | 1.48 | %(d) | 1.49 | %(d) | 1.48 | %(d) | 1.49 | %(d) | (0.67 | )%(d) | 66 | % | |||||||||||||||||||||||||||
Year ended 10/31/17 | 9.80 | (0.05 | ) | 0.33 | 0.28 | — | (0.01 | ) | (0.01 | ) | 10.07 | 2.81 | 11,085 | 1.43 | 1.48 | 1.43 | 1.48 | (0.50 | ) | 162 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.92 | (0.03 | ) | (0.76 | ) | (0.79 | ) | (1.33 | ) | — | (1.33 | ) | 9.80 | (7.42 | ) | 42,539 | 1.61 | 1.85 | 1.61 | 1.85 | (0.26 | ) | 168 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.70 | (0.20 | ) | 1.42 | 1.22 | — | — | — | 11.92 | 11.40 | 12,812 | 3.69 | (e) | 4.62 | (e) | 1.60 | 2.53 | (1.85 | ) | 175 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.27 | ) | 0.97 | 0.70 | — | — | — | 10.70 | 7.00 | 9,742 | 4.53 | (e)(g) | 7.28 | (e)(g) | 1.60 | (g) | 4.35 | (g) | (3.03 | )(g) | 105 | ||||||||||||||||||||||||||||||||||||||||||
Class C |
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Six months ended 04/30/18 | 9.80 | (0.06 | ) | (0.52 | ) | (0.58 | ) | — | (1.17 | ) | (1.17 | ) | 8.05 | (6.10 | ) | 3,044 | 2.23 | (d) | 2.24 | (d) | 2.23 | (d) | 2.24 | (d) | (1.42 | )(d) | 66 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.60 | (0.12 | ) | 0.33 | 0.21 | — | (0.01 | ) | (0.01 | ) | 9.80 | 2.14 | 4,856 | 2.18 | 2.23 | 2.18 | 2.23 | (1.25 | ) | 162 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.76 | (0.10 | ) | (0.76 | ) | (0.86 | ) | (1.30 | ) | — | (1.30 | ) | 9.60 | (8.19 | ) | 10,136 | 2.36 | 2.60 | 2.36 | 2.60 | (1.01 | ) | 168 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.63 | (0.28 | ) | 1.41 | 1.13 | — | — | — | 11.76 | 10.63 | 1,772 | 4.44 | (e) | 5.37 | (e) | 2.35 | 3.28 | (2.60 | ) | 175 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.34 | ) | 0.97 | 0.63 | — | — | — | 10.63 | 6.30 | 857 | 5.28 | (e)(g) | 8.03 | (e)(g) | 2.35 | (g) | 5.10 | (g) | (3.78 | )(g) | 105 | ||||||||||||||||||||||||||||||||||||||||||
Class R |
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Six months ended 04/30/18 | 9.98 | (0.05 | ) | (0.52 | ) | (0.57 | ) | — | (1.17 | ) | (1.17 | ) | 8.24 | (5.87 | ) | 107 | 1.73 | (d) | 1.74 | (d) | 1.73 | (d) | 1.74 | (d) | (0.92 | )(d) | 66 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.73 | (0.07 | ) | 0.33 | 0.26 | — | (0.01 | ) | (0.01 | ) | 9.98 | 2.63 | 109 | 1.68 | 1.73 | 1.68 | 1.73 | (0.75 | ) | 162 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.86 | (0.05 | ) | (0.76 | ) | (0.81 | ) | (1.32 | ) | — | (1.32 | ) | 9.73 | (7.66 | ) | 104 | 1.86 | 2.10 | 1.86 | 2.10 | (0.51 | ) | 168 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.68 | (0.22 | ) | 1.40 | 1.18 | — | — | — | 11.86 | 11.05 | 23 | 3.94 | (e) | 4.87 | (e) | 1.85 | 2.78 | (2.10 | ) | 175 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.29 | ) | 0.97 | 0.68 | — | — | — | 10.68 | 6.80 | 40 | 4.78 | (e)(g) | 7.53 | (e)(g) | 1.85 | (g) | 4.60 | (g) | (3.28 | )(g) | 105 | ||||||||||||||||||||||||||||||||||||||||||
Class Y |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.15 | (0.02 | ) | (0.53 | ) | (0.55 | ) | — | (1.17 | ) | (1.17 | ) | 8.43 | (5.56 | ) | 28,540 | 1.23 | (d) | 1.24 | (d) | 1.23 | (d) | 1.24 | (d) | (0.42 | )(d) | 66 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.85 | (0.03 | ) | 0.34 | 0.31 | — | (0.01 | ) | (0.01 | ) | 10.15 | 3.10 | 40,875 | 1.18 | 1.23 | 1.18 | 1.23 | (0.25 | ) | 162 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.97 | (0.00 | ) | (0.77 | ) | (0.77 | ) | (1.35 | ) | — | (1.35 | ) | 9.85 | (7.24 | ) | 41,369 | 1.36 | 1.60 | 1.36 | 1.60 | (0.01 | ) | 168 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.72 | (0.17 | ) | 1.42 | 1.25 | — | — | — | 11.97 | 11.66 | 16,907 | 3.44 | (e) | 4.37 | (e) | 1.35 | 2.28 | (1.60 | ) | 175 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.25 | ) | 0.97 | 0.72 | — | — | — | 10.72 | 7.20 | 14,651 | 4.28 | (e)(g) | 7.03 | (e)(g) | 1.35 | (g) | 4.10 | (g) | (2.78 | )(g) | 105 | ||||||||||||||||||||||||||||||||||||||||||
Class R5 |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.18 | (0.01 | ) | (0.55 | ) | (0.56 | ) | — | (1.17 | ) | (1.17 | ) | 8.45 | (5.63 | ) | 9 | 1.09 | (d) | 1.10 | (d) | 1.09 | (d) | 1.10 | (d) | (0.28 | )(d) | 66 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.86 | (0.02 | ) | 0.35 | 0.33 | — | (0.01 | ) | (0.01 | ) | 10.18 | 3.30 | 10 | 1.10 | 1.12 | 1.10 | 1.12 | (0.17 | ) | 162 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.97 | (0.00 | ) | (0.76 | ) | (0.76 | ) | (1.35 | ) | — | (1.35 | ) | 9.86 | (7.15 | ) | 493 | 1.36 | 1.45 | 1.36 | 1.45 | (0.01 | ) | 168 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.72 | (0.17 | ) | 1.42 | 1.25 | — | — | — | 11.97 | 11.66 | 599 | 3.44 | (e) | 4.28 | (e) | 1.35 | 2.19 | (1.60 | ) | 175 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.25 | ) | 0.97 | 0.72 | — | — | — | 10.72 | 7.20 | 648 | 4.28 | (e)(g) | 7.00 | (e)(g) | 1.35 | (g) | 4.07 | (g) | (2.78 | )(g) | 105 | ||||||||||||||||||||||||||||||||||||||||||
Class R6 |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.16 | (0.01 | ) | (0.54 | ) | (0.55 | ) | — | (1.17 | ) | (1.17 | ) | 8.44 | (5.54 | ) | 63,728 | 1.09 | (d) | 1.10 | (d) | 1.09 | (d) | 1.10 | (d) | (0.28 | )(d) | 66 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.85 | (0.02 | ) | 0.34 | 0.32 | — | (0.01 | ) | (0.01 | ) | 10.16 | 3.20 | 71,774 | 1.10 | 1.12 | 1.10 | 1.12 | (0.17 | ) | 162 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.97 | (0.00 | ) | (0.77 | ) | (0.77 | ) | (1.35 | ) | — | (1.35 | ) | 9.85 | (7.24 | ) | 73,442 | 1.36 | 1.44 | 1.36 | 1.44 | (0.01 | ) | 168 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.72 | (0.17 | ) | 1.42 | 1.25 | — | — | — | 11.97 | 11.66 | 745 | 3.44 | (e) | 4.28 | (e) | 1.35 | 2.19 | (1.60 | ) | 175 | ||||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.25 | ) | 0.97 | 0.72 | — | — | — | 10.72 | 7.20 | 584 | 4.28 | (e)(g) | 6.99 | (e)(g) | 1.35 | (g) | 4.06 | (g) | (2.78 | )(g) | 105 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $11,204, $3,788, $101, $34,649, $9 and $71,319 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Ratio of interest expense and dividends on short sales to average net assets for the years ended October 31, 2015 and October 31, 2014 were 2.09% and 2.93%, respectively. |
(f) | Commencement date of December 17, 2013. |
(g) | Annualized. |
24 Invesco All Cap Market Neutral Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized Ratio | ||||||||||||||||||||
Ending Account Value | Expenses Paid During | Ending Account Value | Expenses Paid During | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 942.80 | $ | 7.13 | $ | 1,017.46 | $ | 7.40 | 1.48 | % | ||||||||||||
C | 1,000.00 | 939.00 | 10.72 | 1,013.74 | 11.13 | 2.23 | ||||||||||||||||||
R | 1,000.00 | 941.30 | 8.33 | 1,016.22 | 8.65 | 1.73 | ||||||||||||||||||
Y | 1,000.00 | 944.40 | 5.93 | 1,018.70 | 6.16 | 1.23 | ||||||||||||||||||
R5 | 1,000.00 | 944.60 | 5.26 | 1,019.39 | 5.46 | 1.09 | ||||||||||||||||||
R6 | 1,000.00 | 944.60 | 5.26 | 1,019.39 | 5.46 | 1.09 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
25 Invesco All Cap Market Neutral Fund
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Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your house-hold, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. | ||
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. ACMN-SAR-1 06132018 1506 |
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Semiannual Report to Shareholders
| April 30, 2018 | |||
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Invesco Balanced-Risk Allocation Fund
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Nasdaq: | ||||
A: ABRZX ∎ C: ABRCX ∎ R: ABRRX ∎ Y: ABRYX ∎ R5: ABRIX ∎ R6: ALLFX |
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2
| Fund Performance
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4
| Letters to Shareholders
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5
| Consolidated Schedule of Investments
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10
| Consolidated Financial Statements
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12
| Notes to Consolidated Financial Statements
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22
| Financial Highlights
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23
| Fund Expenses
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For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
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NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
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Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
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Class A Shares | 2.19 | % | ||
Class C Shares | 1.80 | |||
Class R Shares | 1.94 | |||
Class Y Shares | 2.25 | |||
Class R5 Shares | 2.25 | |||
Class R6 Shares | 2.34 | |||
S&P 500 Index▼ (Broad Market Index) | 3.82 | |||
Custom Invesco Balanced-Risk Allocation Style Index∎ (Style-Specific Index) | 1.35 | |||
Lipper Alternative Global Macro Funds Index◆ (Peer Group Index) | 1.67 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Invesco, FactSet Research Systems Inc.; ◆Lipper Inc. |
|
The S&P 500® Index is an unmanaged index considered representative of the US stock market.
The Custom Invesco Balanced-Risk Allocation Style Index consists of 60% MSCI World Index and 40% Bloomberg Barclays U.S. Aggregate Bond Index. Effective December 1, 2009, the fixed income component of the Custom Invesco Balanced-Risk Allocation Style Index changed from the JP Morgan GBI Global (Traded) Index to the Bloomberg Barclays U.S. Aggregate Bond Index.
The Lipper Alternative Global Macro Funds Index is an unmanaged index considered representative of alternative global macro funds tracked by Lipper.
The Bloomberg Barclays U.S. Aggregate Bond Index is an unmanaged index considered representative of the US investment grade, fixed-rate bond market.
The MSCI World IndexSM is an unmanaged index considered representative of stocks of developed countries. The index is computed using the net return, which withholds applicable taxes for non-resident investors.
The JP Morgan GBI Global (Traded) Index is a total return, market capitalization weighted index, rebalanced monthly, consisting of the following countries: Australia, Germany, Spain, Belgium, Italy, Sweden, Canada, Japan, the United Kingdom, Denmark, the Netherlands and the United States.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Balanced-Risk Allocation Fund
Average Annual Total Returns |
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As of 4/30/18, including maximum applicable sales charges
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Class A Shares |
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Inception (6/2/09) | 6.76 | % | ||||
5 Years | 2.68 | |||||
1 Year | 0.58 | |||||
Class C Shares |
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Inception (6/2/09) | 6.63 | % | ||||
5 Years | 3.07 | |||||
1 Year | 4.62 | |||||
Class R Shares |
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Inception (6/2/09) | 7.16 | % | ||||
5 Years | 3.58 | |||||
1 Year | 6.14 | |||||
Class Y Shares |
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Inception (6/2/09) | 7.70 | % | ||||
5 Years | 4.10 | |||||
1 Year | 6.64 | |||||
Class R5 Shares |
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Inception (6/2/09) | 7.73 | % | ||||
5 Years | 4.14 | |||||
1 Year | 6.73 | |||||
Class R6 Shares |
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Inception | 7.68 | % | ||||
5 Years | 4.22 | |||||
1 Year | 6.82 |
Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C,
Average Annual Total Returns |
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As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (6/2/09) | 6.67 | % | ||||
5 Years | 2.60 | |||||
1 Year | -0.37 | |||||
Class C Shares |
| |||||
Inception (6/2/09) | 6.54 | % | ||||
5 Years | 2.99 | |||||
1 Year | 3.69 | |||||
Class R Shares |
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Inception (6/2/09) | 7.07 | % | ||||
5 Years | 3.51 | |||||
1 Year | 5.24 | |||||
Class Y Shares |
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Inception (6/2/09) | 7.62 | % | ||||
5 Years | 4.02 | |||||
1 Year | 5.76 | |||||
Class R5 Shares |
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Inception (6/2/09) | 7.64 | % | ||||
5 Years | 4.05 | |||||
1 Year | 5.76 | |||||
Class R6 Shares |
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Inception | 7.60 | % | ||||
5 Years | 4.15 | |||||
1 Year | 5.85 |
Class R, Class Y, Class R5 and Class R6 shares was 1.31%, 2.06%, 1.56%, 1.06%, 1.01% and 0.94%, respectively.1 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.37%, 2.12%, 1.62%, 1.12%, 1.07% and 1.00%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco Balanced-Risk Allocation Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including performance, holdings and portfolio manager commentaries. You can access information about |
your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Balanced-Risk Allocation Fund
Consolidated Schedule of Investments
April 30, 2018
(Unaudited)
Interest Rate | Maturity Date | Principal Amount | Value | |||||||||||||
U.S. Treasury Securities–33.98% |
| |||||||||||||||
U.S. Treasury Bills–13.30%(a) | ||||||||||||||||
U.S. Treasury Bills | 1.45 | % | 06/14/2018 | $ | 260,000,000 | $ | 259,478,050 | |||||||||
U.S. Treasury Bills | 1.56 | % | 07/05/2018 | 161,000,000 | 160,494,283 | |||||||||||
U.S. Treasury Bills | 1.67 | % | 08/09/2018 | 207,200,000 | 206,138,887 | |||||||||||
626,111,220 | ||||||||||||||||
U.S. Treasury Notes–20.68% | ||||||||||||||||
U.S. Treasury Floating Rate Notes | 1.84 | % | 01/31/2020 | 390,000,000 | 389,982,918 | |||||||||||
U.S. Treasury Floating Rate Notes | 1.87 | % | 04/30/2020 | 346,240,000 | 346,294,949 | |||||||||||
U.S. Treasury Floating Rate Notes | 2.01 | % | 07/31/2018 | 237,520,000 | 237,655,315 | |||||||||||
973,933,182 | ||||||||||||||||
Total U.S. Treasury Securities (Cost $1,600,084,976) | 1,600,044,402 | |||||||||||||||
Expiration Date | ||||||||||||||||
Commodity-Linked Securities–3.61% |
| |||||||||||||||
Canadian Imperial Bank of Commerce EMTN, U.S. Federal Funds Effective Rate minus 0.03% (linked to the Canadian Imperial Bank of Commerce Custom 6 Agriculture Commodity Index, multiplied by 2) (Canada)(c)(d) | 03/29/2019 | 75,700,000 | 74,109,295 | |||||||||||||
RBC Capital Markets, LLC, Commodity-Linked Notes, U.S. Federal Funds Effective Rate minus 0.04% (linked to the RBC Enhanced Agricultural Basket 06 Excess Return Index)(c)(d) | 03/29/2019 | 98,500,000 | 96,131,557 | |||||||||||||
Total Commodity-Linked Securities (Cost $174,200,000) | 170,240,852 | |||||||||||||||
Shares | ||||||||||||||||
Money Market Funds–56.76% |
| |||||||||||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(e) | 890,055,230 | 890,055,230 | ||||||||||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(e) |
| 226,773,119 | 226,795,796 | |||||||||||||
Invesco Treasury Obligations Portfolio–Institutional Class, 1.59%(e) |
| 1,000,000,000 | 1,000,000,000 | |||||||||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(e) |
| 362,833,406 | 362,833,406 | |||||||||||||
STIC (Global Series) PLC–U.S. Dollar Liquidity Portfolio (Ireland)–Institutional Class, 1.84%(e) |
| 193,069,414 | 193,069,414 | |||||||||||||
Total Money Market Funds (Cost $2,672,751,450) | 2,672,753,846 | |||||||||||||||
TOTAL INVESTMENTS IN SECURITIES–94.35% (Cost $4,447,036,426) | 4,443,039,100 | |||||||||||||||
OTHER ASSETS LESS LIABILITIES–5.65% | 265,908,532 | |||||||||||||||
NET ASSETS–100.00% | $ | 4,708,947,632 |
Open Futures Contracts(f) | ||||||||||||||||||||
Long Futures Contracts | Number of Contracts | Expiration Month | Notional Value | Value | Unrealized Appreciation (Depreciation) | |||||||||||||||
Brent Crude | 1,558 | August-2018 | $ | 115,556,860 | $ | 11,173,022 | $ | 11,173,022 | ||||||||||||
Gasoline Reformulated Blendstock Oxygenate Blending | 1,802 | June-2018 | 161,267,467 | 5,680,535 | 5,680,535 | |||||||||||||||
New York Harbor Ultra-Low Sulfur Diesel | 798 | June-2018 | 72,035,939 | 8,252,089 | 8,252,089 | |||||||||||||||
Silver | 1,578 | July-2018 | 129,403,890 | (2,501,982 | ) | (2,501,982 | ) | |||||||||||||
WTI Crude | 1,160 | October-2018 | 77,824,400 | 6,639,690 | 6,639,690 | |||||||||||||||
Subtotal — Commodity Risk | 29,243,354 | 29,243,354 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
5 Invesco Balanced-Risk Allocation Fund
Open Futures Contracts(f)—(continued) | ||||||||||||||||||||
Long Futures Contracts | Number of Contracts | Expiration Month | Notional Value | Value | Unrealized Appreciation (Depreciation) | |||||||||||||||
Dow Jones EURO STOXX 50 Index | 6,600 | June-2018 | $ | 276,906,287 | $ | 12,075,500 | $ | 12,075,500 | ||||||||||||
E-Mini Russell 2000 Index | 3,290 | June-2018 | 253,955,100 | (9,046,023 | ) | (9,046,023 | ) | |||||||||||||
E-Mini S&P 500 Index | 1,795 | June-2018 | 237,568,250 | (6,811,591 | ) | (6,811,591 | ) | |||||||||||||
FTSE 100 Index | 2,860 | June-2018 | 293,705,870 | 14,363,803 | 14,363,803 | |||||||||||||||
Hang Seng Index | 1,465 | May-2018 | 286,192,601 | 4,014,540 | 4,014,540 | |||||||||||||||
Tokyo Stock Price Index | 2,310 | June-2018 | 376,019,484 | 14,376,923 | 14,376,923 | |||||||||||||||
Subtotal — Equity Risk | 28,973,152 | 28,973,152 | ||||||||||||||||||
Australia 10 Year Bonds | 10,150 | June-2018 | 977,092,586 | (4,343,819 | ) | (4,343,819 | ) | |||||||||||||
Canada 10 Year Bonds | 7,870 | June-2018 | 805,882,605 | 1,519,379 | 1,519,379 | |||||||||||||||
Euro Bonds | 3,170 | June-2018 | 607,721,645 | 6,272,326 | 6,272,326 | |||||||||||||||
Long Gilt | 3,325 | June-2018 | 559,607,861 | 6,187,633 | 6,187,633 | |||||||||||||||
U.S. Treasury Long Bonds | 2,200 | June-2018 | 316,456,250 | 4,087,762 | 4,087,762 | |||||||||||||||
Subtotal — Interest Rate Risk | 13,723,281 | 13,723,281 | ||||||||||||||||||
Total Futures Contracts | $ | 71,939,787 | $ | 71,939,787 |
Open Over-The-Counter Total Return Swap Agreements(g) | ||||||||||||||||||||||||||||||||||||||||
Counterparty | Pay/ Receive | Reference Entity(d) | Fixed Rate | Payment Frequency | Number of Contracts | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation) | ||||||||||||||||||||||||||||||
Barclays Bank PLC | Receive | | Barclays Commodity Strategy 1727 Excess Return Index | | 0.45 | % | Monthly | 338,000 | February-2019 | $ | 93,004,249 | $ | — | $ | 450,216 | $ | 450,216 | |||||||||||||||||||||||
Cargill, Inc. | Receive | | Monthly Rebalance Commodity Excess Return Index | | 0.47 | Monthly | 132,000 | February-2019 | 109,710,506 | — | 0 | 0 | ||||||||||||||||||||||||||||
Cargill, Inc. | Receive | | Single Commodity Index Excess Return | | 0.12 | Monthly | 78,500 | January-2019 | 71,191,556 | — | 0 | 0 | ||||||||||||||||||||||||||||
J.P. Morgan Chase Bank, N.A. | Receive | | J.P. Morgan Contag Beta Gas Oil Excess Return Index | | 0.25 | Monthly | 280,000 | April-2019 | 75,726,056 | — | 823,760 | 823,760 | ||||||||||||||||||||||||||||
Macquarie Bank Ltd. | Receive | | Macquarie Aluminum Dynamic Selection Index | | 0.30 | Monthly | 450,000 | December-2018 | 26,637,075 | — | 68,940 | 68,940 | ||||||||||||||||||||||||||||
Merrill Lynch International | Receive | | Merrill Lynch Gold Excess Return Index | | 0.14 | Monthly | 495,000 | June-2018 | 82,388,048 | — | 0 | 0 | ||||||||||||||||||||||||||||
Merrill Lynch International | Receive | | MLCX Natural Gas Annual Excess Return Index | | 0.25 | Monthly | 1,225,000 | November-2018 | 51,369,236 | — | 0 | 0 | ||||||||||||||||||||||||||||
Subtotal — Commodity Risk |
| — | 1,342,916 | 1,342,916 | ||||||||||||||||||||||||||||||||||||
Goldman Sachs International | Receive | Hang Seng Index Futures | — | Monthly | 235 | May-2018 | 45,908,028 | — | 612,452 | 612,452 | ||||||||||||||||||||||||||||||
Subtotal — Equity Risk |
| — | 612,452 | 612,452 | ||||||||||||||||||||||||||||||||||||
Subtotal — Appreciation |
| — | 1,955,368 | 1,955,368 | ||||||||||||||||||||||||||||||||||||
Barclays Bank PLC | Receive | | Barclays Commodity Strategy 1452 Excess Return Index | | 0.33 | Monthly | 142,200 | October-2018 | 79,535,816 | — | (1,219,564 | ) | (1,219,564 | ) | ||||||||||||||||||||||||||
Canadian Imperial Bank of Commerce | Receive | | Canadian Imperial Bank of Commerce Dynamic Roll LME Copper Excess Return Index 2 | | 0.30 | Monthly | 1,090,000 | April-2019 | 95,451,845 | — | (2,004,401 | ) | (2,004,401 | ) | ||||||||||||||||||||||||||
Canadian Imperial Bank of Commerce | Receive | | Canadian Imperial Bank of Commerce Custom 6 Agriculture Commodity Index | | 0.47 | Monthly | 252,000 | February-2019 | 22,560,149 | — | (85,831 | ) | (85,831 | ) | ||||||||||||||||||||||||||
Goldman Sachs International | Receive | | Goldman Sachs Commodity Strategy 1057 Index | | 0.40 | Monthly | 1,098,000 | February-2019 | 94,454,275 | — | (1,242,145 | ) | (1,242,145 | ) | ||||||||||||||||||||||||||
J.P. Morgan Chase Bank, N.A. | Receive | | S&P GSCI Gold Index Excess Return | | 0.09 | Monthly | 621,000 | October-2018 | 66,191,583 | — | (240,017 | ) | (240,017 | ) | ||||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Receive | | S&P GSCI Aluminum Dynamic Roll Index Excess Return | | 0.38 | Monthly | 596,000 | October-2018 | 74,107,653 | — | (3,594,714 | ) | (3,594,714 | ) | ||||||||||||||||||||||||||
Subtotal — Depreciation — Commodity Risk |
| — | (8,386,672 | ) | (8,386,672 | ) | ||||||||||||||||||||||||||||||||||
Total — Total Return Swap Agreements |
| $ | — | $ | (6,431,304 | ) | $ | (6,431,304 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
6 Invesco Balanced-Risk Allocation Fund
Investments Abbreviations:
EMTN | – European Medium-Term Notes |
Notes to Consolidated Schedule of Investments:
(a) | Securities traded on a discount basis. The interest rates shown represent the discount rates at the time of purchase by the Fund. |
(b) | Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on April 30, 2018. |
(c) | Security purchased or received in transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2018 was $170,240,852, which represented 3.61% of the Fund’s Net Assets. |
(d) | The table below includes additional information regarding the underlying components of certain reference entities that are not publicly available. |
Reference Entity Components | ||||||
Reference Entity | Underlying Components | Percentage | ||||
Canadian Imperial Bank of Commerce Custom 6 Agriculture Commodity Index |
| |||||
Long Futures Contracts | ||||||
Cocoa | 0.17 | % | ||||
Coffee ‘C’ | 4.77 | |||||
Corn | 4.94 | |||||
Cotton No. 2 | 20.60 | |||||
Lean Hogs | 0.54 | |||||
Live Cattle | 0.44 | |||||
Soybean Meal | 19.74 | |||||
Soybean Oil | 4.57 | |||||
Soybeans | 19.36 | |||||
Sugar No. 11 | 20.15 | |||||
Wheat | 4.72 | |||||
Total | 100.00 | % | ||||
RBC Enhanced Agricultural Basket 06 Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Cocoa | 0.17 | % | ||||
Coffee ‘C’ | 4.77 | |||||
Corn | 4.94 | |||||
Cotton No. 2 | 20.60 | |||||
Lean Hogs | 0.54 | |||||
Live Cattle | 0.44 | |||||
Soybean Meal | 19.74 | |||||
Soybean Oil | 4.57 | |||||
Soybeans | 19.36 | |||||
Sugar No. 11 | 20.15 | |||||
Wheat | 4.72 | |||||
Total | 100.00 | % | ||||
Barclays Commodity Strategy 1727 Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Cocoa | 0.17 | % | ||||
Coffee ‘C’ | 4.77 | |||||
Corn | 4.94 | |||||
Cotton No. 2 | 20.60 | |||||
Lean Hogs | 0.54 | |||||
Live Cattle | 0.44 | |||||
Soybean Meal | 19.74 | |||||
Soybean Oil | 4.57 | |||||
Soybeans | 19.36 | |||||
Sugar No. 11 | 20.15 | |||||
Wheat | 4.72 | |||||
Total | 100.00 | % |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
7 Invesco Balanced-Risk Allocation Fund
Reference Entity Components—(continued) | ||||||
Reference Entity | Underlying Components | Percentage | ||||
Monthly Rebalance Commodity Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Cocoa | 0.17 | % | ||||
Coffee ‘C’ | 5.28 | |||||
Corn | 7.70 | |||||
Cotton No. 2 | 18.88 | |||||
Lean Hogs | 0.52 | |||||
Live Cattle | 1.24 | |||||
Soybean Meal | 18.81 | |||||
Soybean Oil | 4.79 | |||||
Soybeans | 18.38 | |||||
Sugar No. 11 | 19.42 | |||||
Wheat | 4.81 | |||||
Total | 100.00 | % | ||||
Single Commodity Index Excess Return |
| |||||
Long Futures Contracts | ||||||
Gold | 100.00 | % | ||||
J.P. Morgan Contag Beta Gas Oil Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Gas Oil | 100.00 | % | ||||
Macquarie Aluminum Dynamic Selection Index |
| |||||
Long Futures Contracts | ||||||
Aluminum | 100.00 | % | ||||
Merrill Lynch Gold Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Gold | 100.00 | % | ||||
MLCX Natural Gas Annual Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Natural Gas | 100.00 | % | ||||
Barclays Commodity Strategy 1452 Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Copper | 100.00 | % | ||||
Canadian Imperial Bank of Commerce Dynamic Roll LME Copper Excess Return Index 2 |
| |||||
Long Futures Contracts | ||||||
Copper | 100.00 | % |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
8 Invesco Balanced-Risk Allocation Fund
Reference Entity Components—(continued) | ||||||
Reference Entity | Underlying Components | Percentage | ||||
Goldman Sachs Commodity Strategy 1057 Index |
| |||||
Long Futures Contracts | ||||||
Cocoa | 0.17 | % | ||||
Coffee ‘C’ | 4.77 | |||||
Corn | 4.94 | |||||
Cotton No. 2 | 20.60 | |||||
Lean Hogs | 0.54 | |||||
Live Cattle | 0.44 | |||||
Soybean Meal | 19.74 | |||||
Soybean Oil | 4.57 | |||||
Soybeans | 19.36 | |||||
Sugar No. 11 | 20.15 | |||||
Wheat | 4.72 | |||||
Total | 100.00 | % | ||||
S&P GSCI Gold Index Excess Return |
| |||||
Long Futures Contracts | ||||||
Gold | 100.00 | % | ||||
S&P GSCI Aluminum Dynamic Roll Index Excess Return |
| |||||
Long Futures Contracts | ||||||
Aluminum | 100.00 | % |
(e) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
(f) | Futures contracts collateralized by $177,720,000 cash held with Bank of America Merrill Lynch, the futures commission merchant. |
(g) | The Fund receives or pays payments based on any positive or negative return on the Reference Entity, respectively. |
Target Risk Allocation and Notional Asset Weights as of 04/30/2018
By asset class
Asset Class | Target Risk Allocation* | Notional Asset Weights** | ||||||
Equities | 35.02 | % | 36.86 | % | ||||
Fixed Income | 25.08 | 70.89 | ||||||
Commodities | 39.90 | 38.27 | ||||||
Total | 100.00 | 146.02 |
* | Reflects the risk that each asset class is expected to contribute to the overall risk of the Fund as measured by standard deviation and estimates of risk based on historical data. Standard deviation measures the annualized fluctuations (volatility) of monthly returns. |
** | Proprietary models determine the Notional Asset Weights necessary to achieve the Target Risk Allocations. Total Notional Asset Weight greater than 100% is achieved through derivatives and other instruments that create leverage. |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
9 Invesco Balanced-Risk Allocation Fund
Consolidated Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $1,774,284,976) | $ | 1,770,285,254 | ||
Investments in affiliated money market funds, at value (Cost $2,672,751,450) | 2,672,753,846 | |||
Other investments: | ||||
Variation margin receivable — futures contracts | 13,612,691 | |||
Swaps receivable — OTC | 94,475 | |||
Unrealized appreciation on swap agreements — OTC | 1,955,368 | |||
Deposits with brokers: | ||||
Cash collateral — exchange-traded futures contracts | 177,720,000 | |||
Cash collateral — OTC Derivatives | 59,625,501 | |||
Cash | 22,891,580 | |||
Receivable for: | ||||
Fund shares sold | 6,017,438 | |||
Dividends and interest | 4,060,331 | |||
Investment for trustee deferred compensation and retirement plans | 630,406 | |||
Other assets | 103,630 | |||
Total assets | 4,729,750,520 | |||
Liabilities: |
| |||
Other investments: | ||||
Swaps payable — OTC | 3,036,803 | |||
Unrealized depreciation on swap agreements — OTC | 8,386,672 | |||
Payable for: | ||||
Fund shares reacquired | 6,330,867 | |||
Accrued fees to affiliates | 2,165,670 | |||
Accrued trustees’ and officers’ fees and benefits | 5,706 | |||
Accrued other operating expenses | 157,566 | |||
Trustee deferred compensation and retirement plans | 719,604 | |||
Total liabilities | 20,802,888 | |||
Net assets applicable to shares outstanding | $ | 4,708,947,632 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 4,576,002,407 | ||
Undistributed net investment income | 1,800,227 | |||
Undistributed net realized gain | 69,633,841 | |||
Net unrealized appreciation | 61,511,157 | |||
$ | 4,708,947,632 |
Net Assets: |
| |||
Class A | $ | 1,226,058,725 | ||
Class C | $ | 917,385,254 | ||
Class R | $ | 22,633,972 | ||
Class Y | $ | 1,971,122,153 | ||
Class R5 | $ | 128,812,492 | ||
Class R6 | $ | 442,935,036 | ||
Shares outstanding, no par value, |
| |||
Class A | 113,459,887 | |||
Class C | 89,009,500 | |||
Class R | 2,130,839 | |||
Class Y | 179,687,188 | |||
Class R5 | 11,735,826 | |||
Class R6 | 40,304,398 | |||
Class A: | ||||
Net asset value per share | $ | 10.81 | ||
Maximum offering price per share | ||||
(Net asset value of $10.81 ¸ 94.50%) | $ | 11.44 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 10.31 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 10.62 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 10.97 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 10.98 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 10.99 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
10 Invesco Balanced-Risk Allocation Fund
Consolidated Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Interest | $ | 14,372,703 | ||
Dividends from affiliated money market funds | 17,840,412 | |||
Total investment income | 32,213,115 | |||
Expenses: | ||||
Advisory fees | 20,941,754 | |||
Administrative services fees | 308,792 | |||
Custodian fees | 72,187 | |||
Distribution fees: |
| |||
Class A | 1,587,236 | |||
Class B | 10,835 | |||
Class C | 4,862,916 | |||
Class R | 56,747 | |||
Transfer agent fees — A, B, C, R and Y | 2,556,887 | |||
Transfer agent fees — R5 | 53,945 | |||
Transfer agent fees — R6 | 24,107 | |||
Trustees’ and officers’ fees and benefits | 41,005 | |||
Registration and filing fees | 112,412 | |||
Reports to shareholders | 160,317 | |||
Professional services fees | 89,402 | |||
Other | 47,334 | |||
Total expenses | 30,925,876 | |||
Less: Fees waived and expense offset arrangement(s) | (1,563,880 | ) | ||
Net expenses | 29,361,996 | |||
Net investment income | 2,851,119 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | 13,637,939 | |||
Foreign currencies | (850,188 | ) | ||
Futures contracts | 79,785,019 | |||
Swap agreements | 36,995,966 | |||
129,568,736 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | (3,439,546 | ) | ||
Futures contracts | (25,445,608 | ) | ||
Swap agreements | (6,703,615 | ) | ||
(35,588,769 | ) | |||
Net realized and unrealized gain | 93,979,967 | |||
Net increase in net assets resulting from operations | $ | 96,831,086 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
11 Invesco Balanced-Risk Allocation Fund
Consolidated Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income (loss) | $ | 2,851,119 | $ | (27,225,221 | ) | |||
Net realized gain | 129,568,736 | 214,440,934 | ||||||
Change in net unrealized appreciation (depreciation) | (35,588,769 | ) | 194,728,338 | |||||
Net increase in net assets resulting from operations | 96,831,086 | 381,944,051 | ||||||
Distributions to shareholders from net investment income: | ||||||||
Class A | — | (66,255,742 | ) | |||||
Class B | — | (237,993 | ) | |||||
Class C | — | (36,855,169 | ) | |||||
Class R | — | (922,264 | ) | |||||
Class Y | — | (66,982,783 | ) | |||||
Class R5 | — | (5,634,379 | ) | |||||
Class R6 | — | (11,414,824 | ) | |||||
Total distributions from net investment income | — | (188,303,154 | ) | |||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | (80,624,310 | ) | (74,624,430 | ) | ||||
Class B | (290,393 | ) | (342,193 | ) | ||||
Class C | (65,247,506 | ) | (52,991,448 | ) | ||||
Class R | (1,429,505 | ) | (1,119,513 | ) | ||||
Class Y | (128,170,205 | ) | (70,271,304 | ) | ||||
Class R5 | (7,249,597 | ) | (5,814,960 | ) | ||||
Class R6 | (19,300,763 | ) | (11,561,935 | ) | ||||
Total distributions from net realized gains | (302,312,279 | ) | (216,725,783 | ) | ||||
Share transactions–net: | ||||||||
Class A | (56,990,770 | ) | (502,289,546 | ) | ||||
Class B | (4,780,164 | ) | (3,444,466 | ) | ||||
Class C | (85,005,510 | ) | (214,072,180 | ) | ||||
Class R | 94,265 | (3,615,578 | ) | |||||
Class Y | (92,401,377 | ) | 376,209,099 | |||||
Class R5 | 14,505,203 | (24,107,384 | ) | |||||
Class R6 | 135,350,822 | 32,561,955 | ||||||
Net increase (decrease) in net assets resulting from share transactions | (89,227,531 | ) | (338,758,100 | ) | ||||
Net increase (decrease) in net assets | (294,708,724 | ) | (361,842,986 | ) | ||||
Net assets: | ||||||||
Beginning of period | 5,003,656,356 | 5,365,499,342 | ||||||
End of period (includes undistributed net investment income (loss) of $1,800,227 and $(1,050,892), respectively) | $ | 4,708,947,632 | $ | 5,003,656,356 |
Notes to Consolidated Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Balanced-Risk Allocation Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these consolidated financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
12 Invesco Balanced-Risk Allocation Fund
The Fund will seek to gain exposure to the commodity markets primarily through investments in the Invesco Cayman Commodity Fund I Ltd. (the “Subsidiary”), a wholly-owned subsidiary of the Fund organized under the laws of the Cayman Islands. The Subsidiary was organized by the Fund to invest in commodity-linked derivatives and other securities that may provide leveraged and non-leveraged exposure to commodities. The Fund may invest up to 25% of its total assets in the Subsidiary.
The Fund’s investment objective is to provide total return with a low to moderate correlation to traditional financial market indices.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Effective November 30, 2010, new or additional investments in Class B shares are no longer permitted. Existing shareholders of Class B shares were permitted to continue to reinvest dividends and capital gains distributions in Class B shares until their conversion to Class A shares. Also, shareholders in Class B shares were able to exchange those shares for Class B shares of other Invesco Funds offering such shares until they converted to Class A shares. Generally, Class B shares automatically converted to Class A shares on or about the month-end, which was at least eight years after the date of purchase. Redemptions of Class B shares prior to the conversion date were subject to a CDSC. Effective January 26, 2018, all of the Fund’s outstanding Class B shares were converted to Class A shares, in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its consolidated financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
13 Invesco Balanced-Risk Allocation Fund
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the consolidated financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Consolidated Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Consolidated Statement of Operations and the Consolidated Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Consolidated Statement of Operations and the Consolidated Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Consolidated Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the consolidated financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Subsidiary is classified as a controlled foreign corporation under Subchapter N of the Internal Revenue Code. Therefore, the Fund is required to increase its taxable income by its share of the Subsidiary’s income. Net investment losses of the Subsidiary cannot be deducted by the Fund in the current period nor carried forward to offset taxable income in future periods.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The financial statements are prepared on a consolidated basis in conformity with accounting principles generally accepted in the United States of America (“GAAP”), which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. The accompanying financial statements reflect the financial position of the Fund and its Subsidiary and the results of operations on a consolidated basis. All inter-company accounts and transactions have been eliminated in consolidation. |
In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the consolidated financial statements are released to print.
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust, and under the Subsidiary’s organizational documents, the directors and officers of the Subsidiary, are indemnified against certain liabilities that may arise out of the performance of their duties to the Fund and/or the Subsidiary, respectively. Additionally, in the normal course of business, the Fund enters |
14 Invesco Balanced-Risk Allocation Fund
into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Structured Securities — The Fund may invest in structured securities. Structured securities are a type of derivative security whose value is determined by reference to changes in the value of underlying securities, currencies, interest rates, commodities, indices or other financial indicators (“reference instruments”). Most structured securities are fixed-income securities that have maturities of three years or less. Structured securities may be positively or negatively indexed (i.e., their principal value or interest rates may increase or decrease if the underlying reference instrument appreciates) and may have return characteristics similar to direct investments in the underlying reference instrument. |
Structured securities may entail a greater degree of market risk than other types of debt securities because the investor bears the risk of the reference instruments. In addition to the credit risk of structured securities and the normal risks of price changes in response to changes in interest rates, the principal amount of structured notes or indexed securities may decrease as a result of changes in the value of the underlying reference instruments. Changes in the daily value of structured securities are recorded as unrealized gains (losses) in the Consolidated Statement of Operations. When the structured securities mature or are sold, the Fund recognizes a realized gain (loss) on the Consolidated Statement of Operations.
J. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Consolidated Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Consolidated Statement of Operations.
K. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Consolidated Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Consolidated Statement of Assets and Liabilities.
L. | Futures Contracts — The Fund may enter into futures contracts to equitize the Fund’s cash holdings or to manage exposure to interest rate, equity, commodity and market price movements and/or currency risks. A futures contract is an agreement between Counterparties to purchase or sell a specified underlying security, currency or commodity (or delivery of a cash settlement price, in the case of an index future) for a fixed price at a future date. The Fund currently invests only in exchange-traded futures and they are standardized as to maturity date and underlying financial instrument. Initial margin deposits required upon entering into futures contracts are satisfied by the segregation of specific securities or cash as collateral at the futures commission merchant (broker). During the period the futures contracts are open, changes in the value of the contracts are recognized as unrealized gains or losses by recalculating the value of the contracts on a daily basis. Subsequent or variation margin payments are received or made depending upon whether unrealized gains or losses are incurred. These amounts are reflected as receivables or payables on the Consolidated Statement of Assets and Liabilities. When the contracts are closed or expire, the Fund recognizes a realized gain or loss equal to the difference between the proceeds from, or cost of, the closing transaction and the Fund’s basis in the contract. The net realized gain (loss) and the change in unrealized gain (loss) on futures contracts held during the period is included on the Consolidated Statement of Operations. The primary risks associated with futures contracts are market risk and the absence of a liquid secondary market. If the Fund were unable to liquidate a futures contract and/or enter into an offsetting closing transaction, the Fund would continue to be subject to market risk with respect to the value of the contracts and continue to be required to maintain the margin deposits on the futures contracts. Futures contracts have minimal Counterparty risk since the exchange’s clearinghouse, as Counterparty to all exchange-traded futures, guarantees the futures against default. Risks may exceed amounts recognized in the Consolidated Statement of Assets and Liabilities. |
M. | Swap Agreements — The Fund may enter into various swap transactions, including interest rate, total return, index, currency and credit default swap contracts (“CDS”) for investment purposes or to manage interest rate, currency, commodity or credit risk. Such transactions are agreements between Counterparties. These agreements may contain among other conditions, events of default and termination events, and various covenants and representations such as provisions that require the Fund to maintain a pre-determined level of net assets, and/or provide |
15 Invesco Balanced-Risk Allocation Fund
limits regarding the decline of the Fund’s NAV over specific periods of time. If the Fund were to trigger such provisions and have open derivative positions at that time, the Counterparty may be able to terminate such agreement and request immediate payment in an amount equal to the net liability positions, if any. |
Interest rate, total return, index, and currency swap agreements are two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a notional amount, i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate or return of an underlying asset, in a particular foreign currency, or in a “basket” of securities representing a particular index. At the maturity date, a net cash flow is exchanged where the total return is equivalent to the return of the underlying reference less a financing rate, if any. As a receiver, the Fund would receive payments based on any positive total return and would owe payments in the event of a negative total return. As the payer, the Fund would owe payments on any net positive total return, and would receive payment in the event of a negative total return.
Changes in the value of swap agreements are recognized as unrealized gains (losses) in the Consolidated Statement of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Consolidated Statement of Assets and Liabilities and may be referred to as upfront payments. The Fund accrues for the fixed payment stream and amortizes upfront payments, if any, on swap agreements on a daily basis with the net amount, recorded as a component of realized gain (loss) on the Consolidated Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Consolidated Statement of Operations. The Fund segregates cash or liquid securities having a value at least equal to the amount of the potential obligation of a Fund under any swap transaction. Cash held as collateral is recorded as deposits with brokers on the Consolidated Statement of Assets and Liabilities. Entering into these agreements involves, to varying degrees, lack of liquidity and elements of credit, market, and Counterparty risk in excess of amounts recognized on the Consolidated Statement of Assets and Liabilities. Such risks involve the possibility that a swap is difficult to sell or liquidate; the Counterparty does not honor its obligations under the agreement and unfavorable interest rates and market fluctuations. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund’s exposure is unlimited.
N. | Other Risks — The Fund will seek to gain exposure to commodity markets primarily through an investment in the Subsidiary and through investments in exchange-traded funds and commodity-linked derivatives. The Subsidiary, unlike the Fund, may invest without limitation in commodities, commodity-linked derivatives and other securities, such as exchange-traded and commodity-linked notes, that may provide leveraged and non-leveraged exposure to commodity markets. The Fund is indirectly exposed to the risks associated with the Subsidiary’s investments. |
O. | Leverage Risk — Leverage exists when the Fund can lose more than it originally invests because it purchases or sells an instrument or enters into a transaction without investing an amount equal to the full economic exposure of the instrument or transaction. |
P. | Collateral — To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund’s practice to replace such collateral no later than the next business day. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser less the amount paid by the Subsidiary to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||||||
First $250 million | 0 | .95% | ||||||
Next $250 million | 0 | .925% | ||||||
Next $500 million | 0 | .90% | ||||||
Next $1.5 billion | 0 | .875% | ||||||
Next $2.5 billion | 0 | .85% | ||||||
Next $2.5 billion | 0 | .825% | ||||||
Next $2.5 billion | 0 | .80% | ||||||
Over $10 billion | 0 | .775% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.87%.
The Subsidiary has entered into a separate contract with the Adviser whereby the Adviser provides investment advisory and other services to the Subsidiary. In consideration of these services, the Subsidiary pays an advisory fee to the Adviser based on the annual rate of the Subsidiary’s average daily net assets as set forth in the table above.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.00%, 2.75%, 2.25%, 1.75%, 1.75% and 1.75%, respectively, of the Fund’s average
16 Invesco Balanced-Risk Allocation Fund
daily net assets (the “expense limits”). Prior to their conversion to Class A shares, the expense limit for Class B shares was 2.75% of average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Acquired Fund Fees and Expenses are not operating expenses of the Fund directly, but are fees and expenses, including management fees of the investment companies in which the Fund invests. As a result, the total annual fund operating expenses after expense reimbursement may exceed the expense limits above. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $1,549,101.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Consolidated Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Consolidated Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. Prior to their conversion to Class A shares, the Fund paid an annual rate of 1.00% of the average daily net assets of Class B shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Consolidated Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $96,718 in front-end sales commissions from the sale of Class A shares and $4,084 and $25,420 from Class A and Class C shares, respectively, for CDSC imposed on redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
17 Invesco Balanced-Risk Allocation Fund
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
U.S. Treasury Securities | $ | — | $ | 1,600,044,402 | $ | — | $ | 1,600,044,402 | ||||||||
Commodity-Linked Securities | — | 170,240,852 | — | 170,240,852 | ||||||||||||
Money Market Funds | 2,672,753,846 | — | — | 2,672,753,846 | ||||||||||||
Total Investments in Securities | 2,672,753,846 | 1,770,285,254 | — | 4,443,039,100 | ||||||||||||
Other Investments — Assets* | ||||||||||||||||
Futures Contracts | 94,643,202 | — | — | 94,643,202 | ||||||||||||
Swap Agreements | — | 1,955,368 | — | 1,955,368 | ||||||||||||
94,643,202 | 1,955,368 | — | 96,598,570 | |||||||||||||
Other Investments — Liabilities* | ||||||||||||||||
Futures Contracts | (22,703,415 | ) | — | — | (22,703,415 | ) | ||||||||||
Swap Agreements | — | (8,386,672 | ) | — | (8,386,672 | ) | ||||||||||
(22,703,415 | ) | (8,386,672 | ) | — | (31,090,087 | ) | ||||||||||
Total Other Investments | 71,939,787 | (6,431,304 | ) | — | 65,508,483 | |||||||||||
Total Investments | $ | 2,744,693,633 | $ | 1,763,853,950 | $ | — | $ | 4,508,547,583 |
* | Unrealized appreciation (depreciation). |
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Consolidated Statement of Assets and Liabilities.
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2018:
Value | ||||||||||||||||
Derivative Assets | Commodity Risk | Equity Risk | Interest Rate Risk | Total | ||||||||||||
Unrealized appreciation on futures contracts — Exchange-Traded(a) | $ | 31,745,336 | $ | 44,830,766 | $ | 18,067,100 | $ | 94,643,202 | ||||||||
Unrealized appreciation on swap agreements — OTC | 1,342,916 | 612,452 | — | 1,955,368 | ||||||||||||
Total Derivative Assets | 33,088,252 | 45,443,218 | 18,067,100 | 96,598,570 | ||||||||||||
Derivatives not subject to master netting agreements | (31,745,336 | ) | (44,830,766 | ) | (18,067,100 | ) | (94,643,202 | ) | ||||||||
Total Derivative Assets subject to master netting agreements | $ | 1,342,916 | $ | 612,452 | — | 1,955,368 | ||||||||||
Value | ||||||||||||||||
Derivative Liabilities | Commodity Risk | Equity Risk | Interest Rate Risk | Total | ||||||||||||
Unrealized depreciation on futures contracts — Exchange-Traded(a) | $ | (2,501,982 | ) | $ | (15,857,614 | ) | $ | (4,343,819 | ) | $ | (22,703,415 | ) | ||||
Unrealized depreciation on swap agreements — OTC | (8,386,672 | ) | — | — | (8,386,672 | ) | ||||||||||
Total Derivative Liabilities | (10,888,654 | ) | (15,857,614 | ) | (4,343,819 | ) | (31,090,087 | ) | ||||||||
Derivatives not subject to master netting agreements | 2,501,982 | 15,857,614 | 4,343,819 | 22,703,415 | ||||||||||||
Total Derivative Liabilities subject to master netting agreements | $ | (8,386,672 | ) | $ | — | $ | — | $ | (8,386,672 | ) |
(a) | The daily variation margin receivable (payable) at period-end is recorded in the Consolidated Statement of Assets and Liabilities. |
18 Invesco Balanced-Risk Allocation Fund
Offsetting Assets and Liabilities
The table below reflects the Fund’s exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of April 30, 2018.
Financial Derivative Assets | Financial Derivative Liabilities | Net Value of Derivatives | Collateral (Received)/Pledged | |||||||||||||||||||||
Counterparty | Swap Agreements | Swap Agreements | Non-Cash | Cash | Net Amount(a) | |||||||||||||||||||
Parent | ||||||||||||||||||||||||
Goldman Sachs International | $ | 612,452 | $ | — | $ | 612,452 | $ | — | $ | — | $ | 612,452 | ||||||||||||
Subsidiary | ||||||||||||||||||||||||
Barclays Bank PLC | 450,216 | (1,247,336 | ) | (797,120 | ) | — | 797,120 | — | ||||||||||||||||
Canadian Imperial Bank of Commerce | 94,475 | (2,206,210 | ) | (2,111,735 | ) | — | 2,111,735 | — | ||||||||||||||||
Cargill, Inc. | — | (1,317,700 | ) | (1,317,700 | ) | — | 1,050,000 | (267,700 | ) | |||||||||||||||
Goldman Sachs International | — | (1,264,918 | ) | (1,264,918 | ) | — | 1,264,918 | — | ||||||||||||||||
J.P. Morgan Chase Bank, N.A. | 823,760 | (244,434 | ) | 579,326 | — | — | 579,326 | |||||||||||||||||
Macquarie Bank, Ltd. | 68,940 | (1,314 | ) | 67,626 | — | — | 67,626 | |||||||||||||||||
Merrill Lynch International | — | (1,535,276 | ) | (1,535,276 | ) | — | 1,535,276 | — | ||||||||||||||||
Morgan Stanley Capital Services LLC | — | (3,606,287 | ) | (3,606,287 | ) | — | 3,606,287 | — | ||||||||||||||||
Subtotal — Subsidiary | 1,437,391 | (11,423,475 | ) | (9,986,084 | ) | — | 10,365,336 | 379,252 | ||||||||||||||||
Total | $ | 2,049,843 | $ | (11,423,475 | ) | $ | (9,373,632 | ) | $ | — | $ | 10,365,336 | $ | 991,704 |
(a) | The Fund and the Subsidiary are recognized as separate legal entities and as such are subject to separate netting arrangements with the Counterparty. |
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Consolidated Statement of Operations | ||||||||||||||||
Commodity Risk | Equity Risk | Interest Rate Risk | Total | |||||||||||||
Realized Gain (Loss): | ||||||||||||||||
Futures contracts | $ | 54,294,626 | $ | 109,474,503 | $ | (83,984,110 | ) | $ | 79,785,019 | |||||||
Swap agreements | 30,402,344 | 7,721,109 | (1,127,487 | ) | 36,995,966 | |||||||||||
Change in Net Unrealized Appreciation (Depreciation): | ||||||||||||||||
Futures contracts | 5,390,648 | (65,526,896 | ) | 34,690,640 | (25,445,608 | ) | ||||||||||
Swap agreements | (7,418,026 | ) | 714,411 | — | (6,703,615 | ) | ||||||||||
Total | $ | 82,669,592 | $ | 52,383,127 | $ | (50,420,957 | ) | $ | 84,631,762 |
The table below summarizes the average notional value of futures contracts and swap agreements outstanding during the period.
Futures Contracts | Swap Agreements | |||||||
Average notional value | $ | 5,415,892,294 | $ | 1,051,582,894 |
NOTE 5—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $14,779.
NOTE 6—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
19 Invesco Balanced-Risk Allocation Fund
NOTE 7—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Consolidated Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 8—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2017.
NOTE 9—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $174,200,000 and $181,919,135, respectively. During the same period, purchases and sales of U.S. Treasury obligations were $736,240,000 and $759,590,000, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 36,621,757 | ||
Aggregate unrealized (depreciation) of investments | (35,280,083 | ) | ||
Net unrealized appreciation of investments | $ | 1,341,674 |
Cost of investments for tax purposes is $4,507,205,909.
20 Invesco Balanced-Risk Allocation Fund
NOTE 10—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 5,624,467 | $ | 61,248,163 | 18,344,979 | $ | 199,052,527 | ||||||||||
Class B(b) | 1,847 | 19,646 | 17,226 | 180,479 | ||||||||||||
Class C | 2,625,514 | 27,177,568 | 7,991,905 | 83,300,692 | ||||||||||||
Class R | 327,342 | 3,492,907 | 613,374 | 6,597,183 | ||||||||||||
Class Y | 22,059,818 | 242,566,550 | 91,480,150 | 1,002,638,508 | ||||||||||||
Class R5 | 1,354,269 | 15,038,814 | 367,417 | 4,048,073 | ||||||||||||
Class R6 | 14,112,269 | 155,288,535 | 5,656,103 | 62,767,897 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 7,313,148 | 77,958,155 | 12,977,593 | 136,394,509 | ||||||||||||
Class B(b) | 28,468 | 290,375 | 57,085 | 579,412 | ||||||||||||
Class C | 5,839,115 | 59,558,974 | 7,791,943 | 79,088,220 | ||||||||||||
Class R | 118,620 | 1,244,328 | 164,218 | 1,702,944 | ||||||||||||
Class Y | 9,951,049 | 107,570,841 | 10,355,586 | 109,976,321 | ||||||||||||
Class R5 | 667,562 | 7,223,017 | 1,071,434 | 11,378,630 | ||||||||||||
Class R6 | 1,782,157 | 19,300,763 | 2,159,386 | 22,932,683 | ||||||||||||
Automatic conversion of Class B shares to Class A shares:(c) | ||||||||||||||||
Class A | 393,583 | 4,329,415 | 254,966 | 2,780,044 | ||||||||||||
Class B | (411,272 | ) | (4,329,415 | ) | (264,857 | ) | (2,780,044 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (18,436,791 | ) | (200,526,503 | ) | (77,488,915 | ) | (840,516,626 | ) | ||||||||
Class B(b) | (71,742 | ) | (760,770 | ) | (135,528 | ) | (1,424,313 | ) | ||||||||
Class C | (16,507,768 | ) | (171,742,052 | ) | (35,969,659 | ) | (376,461,092 | ) | ||||||||
Class R | (431,265 | ) | (4,642,970 | ) | (1,109,646 | ) | (11,915,705 | ) | ||||||||
Class Y | (40,241,480 | ) | (442,538,768 | ) | (66,911,066 | ) | (736,405,730 | ) | ||||||||
Class R5 | (704,539 | ) | (7,756,628 | ) | (3,647,987 | ) | (39,534,087 | ) | ||||||||
Class R6 | (3,565,318 | ) | (39,238,476 | ) | (4,816,169 | ) | (53,138,625 | ) | ||||||||
Net increase (decrease) in share activity | (8,170,947 | ) | $ | (89,227,531 | ) | (31,040,462 | ) | $ | (338,758,100 | ) |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 43% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
(b) | Class B shares activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(c) | Effective as of the close of business January 26, 2018, all outstanding Class B shares were converted to Class A shares. |
21 Invesco Balanced-Risk Allocation Fund
NOTE 11—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 11.28 | $ | 0.01 | $ | 0.22 | $ | 0.23 | $ | — | $ | (0.70 | ) | $ | (0.70 | ) | $ | 10.81 | 2.10 | % | $ | 1,226,059 | 1.21 | %(d) | 1.27 | %(d) | 0.13 | %(d) | 79 | % | ||||||||||||||||||||||||||
Year ended 10/31/17 | 11.34 | (0.05 | ) | 0.87 | 0.82 | (0.41 | ) | (0.47 | ) | (0.88 | ) | 11.28 | 7.76 | 1,337,537 | 1.22 | 1.28 | (0.49 | ) | 12 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.27 | (0.10 | ) | 0.88 | 0.78 | (0.29 | ) | (0.42 | ) | (0.71 | ) | 11.34 | 7.59 | 1,864,271 | 1.20 | 1.27 | (0.89 | ) | 96 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 12.36 | (0.14 | ) | (0.05 | ) | (0.19 | ) | (0.24 | ) | (0.66 | ) | (0.90 | ) | 11.27 | (1.64 | ) | 2,371,657 | 1.21 | 1.26 | (1.16 | ) | 10 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 12.88 | (0.14 | ) | 0.53 | 0.39 | — | (0.91 | ) | (0.91 | ) | 12.36 | 3.52 | 2,938,957 | 1.20 | 1.24 | (1.16 | ) | 72 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 12.88 | (0.14 | ) | 0.78 | 0.64 | (0.29 | ) | (0.35 | ) | (0.64 | ) | 12.88 | 5.15 | 4,229,859 | 1.14 | 1.21 | (1.07 | ) | 0 | |||||||||||||||||||||||||||||||||||||
Class B | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18(e) | 10.83 | (0.01 | ) | 0.40 | 0.39 | — | (0.70 | ) | (0.70 | ) | 10.52 | 3.78 | — | 1.96 | (d) | 2.02 | (d) | (0.62 | )(d) | 79 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.90 | (0.12 | ) | 0.84 | 0.72 | (0.32 | ) | (0.47 | ) | (0.79 | ) | 10.83 | 7.05 | 4,903 | 1.97 | 2.03 | (1.24 | ) | 12 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.85 | (0.17 | ) | 0.83 | 0.66 | (0.19 | ) | (0.42 | ) | (0.61 | ) | 10.90 | 6.67 | 8,491 | 1.95 | 2.02 | (1.64 | ) | 96 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 11.92 | (0.22 | ) | (0.05 | ) | (0.27 | ) | (0.14 | ) | (0.66 | ) | (0.80 | ) | 10.85 | (2.40 | ) | 13,242 | 1.96 | 2.01 | (1.91 | ) | 10 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 12.53 | (0.23 | ) | 0.53 | 0.30 | — | (0.91 | ) | (0.91 | ) | 11.92 | 2.85 | 20,853 | 1.95 | 1.99 | (1.91 | ) | 72 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 12.59 | (0.22 | ) | 0.75 | 0.53 | (0.24 | ) | (0.35 | ) | (0.59 | ) | 12.53 | 4.34 | 31,381 | 1.89 | 1.96 | (1.82 | ) | 0 | |||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.83 | (0.03 | ) | 0.21 | 0.18 | — | (0.70 | ) | (0.70 | ) | 10.31 | 1.70 | 917,385 | 1.96 | (d) | 2.02 | (d) | (0.62 | )(d) | 79 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.90 | (0.12 | ) | 0.84 | 0.72 | (0.32 | ) | (0.47 | ) | (0.79 | ) | 10.83 | 7.05 | 1,051,038 | 1.97 | 2.03 | (1.24 | ) | 12 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.85 | (0.17 | ) | 0.83 | 0.66 | (0.19 | ) | (0.42 | ) | (0.61 | ) | 10.90 | 6.67 | 1,278,218 | 1.95 | 2.02 | (1.64 | ) | 96 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 11.91 | (0.22 | ) | (0.04 | ) | (0.26 | ) | (0.14 | ) | (0.66 | ) | (0.80 | ) | 10.85 | (2.32 | ) | 1,584,982 | 1.96 | 2.01 | (1.91 | ) | 10 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 12.53 | (0.23 | ) | 0.52 | 0.29 | — | (0.91 | ) | (0.91 | ) | 11.91 | 2.77 | 1,930,318 | 1.95 | 1.99 | (1.91 | ) | 72 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 12.59 | (0.22 | ) | 0.75 | 0.53 | (0.24 | ) | (0.35 | ) | (0.59 | ) | 12.53 | 4.34 | 2,550,094 | 1.89 | 1.96 | (1.82 | ) | 0 | |||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 11.11 | (0.00 | ) | 0.21 | 0.21 | — | (0.70 | ) | (0.70 | ) | 10.62 | 1.94 | 22,634 | 1.46 | (d) | 1.52 | (d) | (0.12 | )(d) | 79 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 11.18 | (0.07 | ) | 0.85 | 0.78 | (0.38 | ) | (0.47 | ) | (0.85 | ) | 11.11 | 7.48 | 23,518 | 1.47 | 1.53 | (0.74 | ) | 12 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.12 | (0.12 | ) | 0.86 | 0.74 | (0.26 | ) | (0.42 | ) | (0.68 | ) | 11.18 | 7.26 | 27,359 | 1.45 | 1.52 | (1.14 | ) | 96 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 12.20 | (0.16 | ) | (0.05 | ) | (0.21 | ) | (0.21 | ) | (0.66 | ) | (0.87 | ) | 11.12 | (1.86 | ) | 25,690 | 1.46 | 1.51 | (1.41 | ) | 10 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 12.75 | (0.17 | ) | 0.53 | 0.36 | — | (0.91 | ) | (0.91 | ) | 12.20 | 3.30 | 28,166 | 1.45 | 1.49 | (1.41 | ) | 72 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 12.77 | (0.17 | ) | 0.77 | 0.60 | (0.27 | ) | (0.35 | ) | (0.62 | ) | 12.75 | 4.89 | 29,964 | 1.39 | 1.46 | (1.32 | ) | 0 | |||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 11.43 | 0.02 | 0.22 | 0.24 | — | (0.70 | ) | (0.70 | ) | 10.97 | 2.16 | 1,971,122 | 0.96 | (d) | 1.02 | (d) | 0.38 | (d) | 79 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 11.47 | (0.02 | ) | 0.88 | 0.86 | (0.43 | ) | (0.47 | ) | (0.90 | ) | 11.43 | 8.15 | 2,147,497 | 0.97 | 1.03 | (0.24 | ) | 12 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.41 | (0.07 | ) | 0.87 | 0.80 | (0.32 | ) | (0.42 | ) | (0.74 | ) | 11.47 | 7.75 | 1,755,257 | 0.95 | 1.02 | (0.64 | ) | 96 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 12.51 | (0.11 | ) | (0.05 | ) | (0.16 | ) | (0.28 | ) | (0.66 | ) | (0.94 | ) | 11.41 | (1.40 | ) | 2,600,015 | 0.96 | 1.01 | (0.91 | ) | 10 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 12.99 | (0.11 | ) | 0.54 | 0.43 | — | (0.91 | ) | (0.91 | ) | 12.51 | 3.81 | 3,699,738 | 0.95 | 0.99 | (0.91 | ) | 72 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 12.97 | (0.10 | ) | 0.78 | 0.68 | (0.31 | ) | (0.35 | ) | (0.66 | ) | 12.99 | 5.42 | 4,846,950 | 0.89 | 0.96 | (0.82 | ) | 0 | |||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 11.43 | 0.02 | 0.23 | 0.25 | — | (0.70 | ) | (0.70 | ) | 10.98 | 2.25 | 128,812 | 0.93 | (d) | 0.99 | (d) | 0.41 | (d) | 79 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 11.48 | (0.01 | ) | 0.87 | 0.86 | (0.44 | ) | (0.47 | ) | (0.91 | ) | 11.43 | 8.12 | 119,103 | 0.92 | 0.98 | (0.19 | ) | 12 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.41 | (0.06 | ) | 0.88 | 0.82 | (0.33 | ) | (0.42 | ) | (0.75 | ) | 11.48 | 7.88 | 144,960 | 0.89 | 0.96 | (0.58 | ) | 96 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 12.51 | (0.10 | ) | (0.06 | ) | (0.16 | ) | (0.28 | ) | (0.66 | ) | (0.94 | ) | 11.41 | (1.39 | ) | 158,826 | 0.93 | 0.98 | (0.88 | ) | 10 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 12.99 | (0.11 | ) | 0.54 | 0.43 | — | (0.91 | ) | (0.91 | ) | 12.51 | 3.81 | 186,943 | 0.93 | 0.97 | (0.89 | ) | 72 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 12.97 | (0.10 | ) | 0.78 | 0.68 | (0.31 | ) | (0.35 | ) | (0.66 | ) | 12.99 | 5.45 | 206,573 | 0.86 | 0.93 | (0.79 | ) | 0 | |||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 11.44 | 0.03 | 0.22 | 0.25 | — | (0.70 | ) | (0.70 | ) | 10.99 | 2.25 | 442,935 | 0.86 | (d) | 0.92 | (d) | 0.48 | (d) | 79 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 11.49 | (0.00 | ) | 0.87 | 0.87 | (0.45 | ) | (0.47 | ) | (0.92 | ) | 11.44 | 8.20 | 320,060 | 0.85 | 0.91 | (0.12 | ) | 12 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.43 | (0.06 | ) | 0.88 | 0.82 | (0.34 | ) | (0.42 | ) | (0.76 | ) | 11.49 | 7.93 | 286,944 | 0.82 | 0.89 | (0.51 | ) | 96 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 12.53 | (0.09 | ) | (0.05 | ) | (0.14 | ) | (0.30 | ) | (0.66 | ) | (0.96 | ) | 11.43 | (1.27 | ) | 418,615 | 0.83 | 0.88 | (0.78 | ) | 10 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 12.99 | (0.10 | ) | 0.55 | 0.45 | — | (0.91 | ) | (0.91 | ) | 12.53 | 3.97 | 480,626 | 0.83 | 0.87 | (0.79 | ) | 72 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 12.97 | (0.09 | ) | 0.77 | 0.68 | (0.31 | ) | (0.35 | ) | (0.66 | ) | 12.99 | 5.48 | 521,099 | 0.79 | 0.86 | (0.72 | ) | 0 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $1,280,303, $4,550, $980,643, $22,887, $2,059,894, $124,747 and $372,646 for Class A, Class B, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
22 Invesco Balanced-Risk Allocation Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017, through April 30, 2018.
In addition to the fees and expenses which the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of the underlying funds in which the Fund invests. The amount of fees and expenses incurred indirectly by the Fund will vary because the underlying funds have varied expenses and fee levels and the Fund may own different proportions of the underlying funds at different times. Estimated underlying fund expenses are not expenses that are incurred directly by the Fund. They are expenses that are incurred directly by the underlying funds and are deducted from the value of the underlying funds the Fund invests in. The effect of the estimated underlying fund expenses that the Fund bears indirectly are included in the Fund’s total return.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, expenses shown in the table do not include the expenses of the underlying funds, which are borne indirectly by the Fund. If transaction costs and indirect expenses were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 1,021.90 | $ | 6.07 | $ | 1,018.79 | $ | 6.06 | 1.21 | % | ||||||||||||
C | 1,000.00 | 1,018.00 | 9.81 | 1,015.08 | 9.79 | 1.96 | ||||||||||||||||||
R | 1,000.00 | 1,019.40 | 7.31 | 1,017.55 | 7.30 | 1.46 | ||||||||||||||||||
Y | 1,000.00 | 1,022.50 | 4.81 | 1,020.03 | 4.81 | 0.96 | ||||||||||||||||||
R5 | 1,000.00 | 1,022.50 | 4.66 | 1,020.18 | 4.66 | 0.93 | ||||||||||||||||||
R6 | 1,000.00 | 1,023.40 | 4.31 | 1,020.53 | 4.31 | 0.86 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
23 Invesco Balanced-Risk Allocation Fund
Explore High-Conviction Investing with Invesco
Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
∎ Quarterly statements
∎ Daily confirmations
∎ Tax forms
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. IBRA-SAR-1 06142018 0953
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco Balanced-Risk Commodity Strategy Fund
| ||||
Nasdaq: | ||||
A: BRCAX ∎ C: BRCCX ∎ R: BRCRX ∎ Y: BRCYX ∎ R5: BRCNX ∎ R6: IBRFX |
| ||||
2
| Fund Performance
| |||
4
| Letters to Shareholders
| |||
5
| Consolidated Schedule of Investments
| |||
9
| Consolidated Financial Statements
| |||
11
| Notes to Consolidated Financial Statements
| |||
20
| Financial Highlights
| |||
21
| Fund Expenses
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 5.52 | % | ||
Class C Shares | 5.16 | |||
Class R Shares | 5.29 | |||
Class Y Shares | 5.59 | |||
Class R5 Shares | 5.74 | |||
Class R6 Shares | 5.59 | |||
Bloomberg Commodity Index▼ (Broad Market/Style-Specific Index) | 4.74 | |||
Source(s): ▼Bloomberg L.P. |
|
The Bloomberg Commodity Index is an unmanaged index designed to be a highly liquid and diversified benchmark for the commodity futures market.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Balanced-Risk Commodity Strategy Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (11/30/10) | -4.80 | % | ||||
5 Years | -5.74 | |||||
1 Year | 2.76 | |||||
Class C Shares |
| |||||
Inception (11/30/10) | -4.78 | % | ||||
5 Years | -5.37 | |||||
1 Year | 6.85 | |||||
Class R Shares |
| |||||
Inception (11/30/10) | -4.28 | % | ||||
5 Years | -4.90 | |||||
1 Year | 8.40 | |||||
Class Y Shares |
| |||||
Inception (11/30/10) | -3.79 | % | ||||
5 Years | -4.42 | |||||
1 Year | 8.94 | |||||
Class R5 Shares |
| |||||
Inception (11/30/10) | -3.74 | % | ||||
5 Years | -4.31 | |||||
1 Year | 9.09 | |||||
Class R6 Shares |
| |||||
Inception | -3.80 | % | ||||
5 Years | -4.29 | |||||
1 Year | 9.09 |
Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C,
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (11/30/10) | -5.13 | % | ||||
5 Years | -7.27 | |||||
1 Year | -1.84 | |||||
Class C Shares |
| |||||
Inception (11/30/10) | -5.11 | % | ||||
5 Years | -6.93 | |||||
1 Year | 2.13 | |||||
Class R Shares |
| |||||
Inception (11/30/10) | -4.59 | % | ||||
5 Years | -6.44 | |||||
1 Year | 3.64 | |||||
Class Y Shares |
| |||||
Inception (11/30/10) | -4.11 | % | ||||
5 Years | -5.97 | |||||
1 Year | 4.15 | |||||
Class R5 Shares |
| |||||
Inception (11/30/10) | -4.07 | % | ||||
5 Years | -5.91 | |||||
1 Year | 4.16 | |||||
Class R6 Shares |
| |||||
Inception | -4.12 | % | ||||
5 Years | -5.84 | |||||
1 Year | 4.31 |
Class R, Class Y, Class R5 and Class R6 shares was 1.58%, 2.33%, 1.83%, 1.33%, 1.25%, and 1.17%, respectively.1 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.65%, 2.40%, 1.90%, 1.40%, 1.32%, and 1.24%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco Balanced-Risk Commodity Strategy Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Balanced-Risk Commodity Strategy Fund
Consolidated Schedule of Investments
April 30, 2018
(Unaudited)
Interest Rate | Maturity Date | Principal Amount | Value | |||||||||||||
U.S. Treasury Securities–27.49% |
| |||||||||||||||
U.S. Treasury Bills–12.41%(a) | ||||||||||||||||
U.S. Treasury Bills | 1.45 | % | 06/14/2018 | $ | 43,000,000 | $ | 42,913,677 | |||||||||
U.S. Treasury Bills(b) | 1.56 | % | 07/05/2018 | 25,650,000 | 25,569,430 | |||||||||||
U.S. Treasury Bills | 1.67 | % | 08/09/2018 | 72,440,000 | 72,069,020 | |||||||||||
140,552,127 | ||||||||||||||||
U.S. Treasury Notes–15.08%(c) | ||||||||||||||||
U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate) | 1.84 | % | 01/31/2020 | 62,880,000 | 62,877,246 | |||||||||||
U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate + 0.03%) | 1.87 | % | 04/30/2020 | 64,000,000 | 64,010,157 | |||||||||||
U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate + 0.17%) | 2.01 | % | 07/31/2018 | 43,910,000 | 43,935,016 | |||||||||||
170,822,419 | ||||||||||||||||
Total U.S. Treasury Securities (Cost $311,395,461) | 311,374,546 | |||||||||||||||
Expiration Date | ||||||||||||||||
Commodity–Linked Securities–5.94% | ||||||||||||||||
Barclays Bank PLC (United Kingdom), U.S. Federal Funds (Effective) rate minus 0.06% (linked to the Barclays Diversified Energy-Metals Total Return Index, multiplied by 3)(d) | 07/19/2018 | 21,150,000 | 37,627,175 | |||||||||||||
International Bank for Reconstruction and Development, 3 month USD LIBOR rate minus 0.78% (linked to the Barclays Diversified Energy-Metals Total Return Index, multiplied by 2) | 01/30/2020 | 30,000,000 | 29,625,169 | |||||||||||||
Total Commodity-Linked Securities (Cost $51,150,000) | 67,252,344 | |||||||||||||||
Shares | ||||||||||||||||
Exchange-Traded Fund–0.95% |
| |||||||||||||||
Invesco DB Gold Fund (Cost $14,018,282)(e) | 260,000 | 10,805,601 | ||||||||||||||
Money Market Funds–62.15% |
| |||||||||||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(f) | 223,769,157 | 223,769,157 | ||||||||||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(f) | 139,723,783 | 139,737,755 | ||||||||||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(f) | 223,561,321 | 223,561,321 | ||||||||||||||
STIC (Global Series) PLC–U.S. Dollar Liquidity Portfolio (Ireland)–Institutional Class (Ireland), 1.70%(f) | 117,052,808 | 117,052,808 | ||||||||||||||
Total Money Market Funds (Cost $704,123,214) | 704,121,041 | |||||||||||||||
TOTAL INVESTMENTS IN SECURITIES–96.53% (Cost $1,080,686,957) | 1,093,553,532 | |||||||||||||||
OTHER ASSETS LESS LIABILITIES–3.47% |
| 39,315,058 | ||||||||||||||
NET ASSETS–100.00% |
| $ | 1,132,868,590 |
Open Futures Contracts | ||||||||||||||||||||
Long Futures Contracts | Number of Contracts | Expiration Month | Notional Value | Value | Unrealized Appreciation | |||||||||||||||
Cocoa | 277 | July-2018 | $ | 7,825,250 | $ | 1,497,123 | $ | 1,497,123 | ||||||||||||
Coffee C | 360 | July-2018 | 16,578,000 | 457,578 | 457,578 | |||||||||||||||
Corn | 1,405 | July-2018 | 28,152,688 | 1,413,728 | 1,413,728 | |||||||||||||||
Cotton No. 2 | 1,312 | December-2018 | 51,679,680 | 2,071,176 | 2,071,176 | |||||||||||||||
Lean Hogs | 177 | December-2018 | 4,207,290 | 59,975 | 59,975 | |||||||||||||||
NYH RBOB Gasoline (Globex) | 990 | July-2018 | 88,598,664 | 3,310,265 | 3,310,265 | |||||||||||||||
Soybean | 871 | July-2018 | 45,662,175 | 1,148,023 | 1,148,023 | |||||||||||||||
Wheat | 883 | July-2018 | 22,538,575 | 1,369,802 | 1,369,802 | |||||||||||||||
Total Long Futures Contracts — Commodity Risk |
| $ | 11,327,670 | $ | 11,327,670 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
5 Invesco Balanced-Risk Commodity Strategy Fund
Open Over-The-Counter Total Return Swap Agreements(g)(h) | ||||||||||||||||||||||||||||||||||||||
Counterparty | Pay/ Receive | Reference Entity(i) | Fixed Rate | Payment Frequency | Number of Contracts | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation) | ||||||||||||||||||||||||||||
Barclays Bank PLC | Receive | Barclays Heating Oil Roll Yield Excess Return Index | 0.37 | % | Monthly | 137,700 | January-2019 | $ | 37,384,022 | $— | $ | 1,597,871 | $ | 1,597,871 | ||||||||||||||||||||||||
Barclays Bank PLC | Receive | Barclays Live Cattle Roll Yield Excess Return Index | 0.47 | Monthly | 29,500 | January-2019 | 3,515,037 | — | 64,953 | 64,953 | ||||||||||||||||||||||||||||
Barclays Bank PLC | Receive | Barclays WTI Crude Roll Yield Excess Return Index | 0.35 | Monthly | 91,700 | March-2019 | 27,698,774 | — | 1,179,400 | 1,179,400 | ||||||||||||||||||||||||||||
Goldman Sachs International | Receive | Enhanced Strategy AB31 on the S&P GSCI Cotton Excess Return Index | 0.45 | Monthly | 1,068,000 | October-2018 | 47,811,455 | — | 207,683 | 207,683 | ||||||||||||||||||||||||||||
Goldman Sachs International | Receive | S&P GSCI Soybean Meal Excess Return Index | 0.30 | Monthly | 74,000 | January-2019 | 96,659,688 | — | 18,352 | 18,352 | ||||||||||||||||||||||||||||
JPMorgan Chase Bank, N.A. | Receive | J.P. Morgan Contag Beta Gas Oil Excess Return Index | 0.25 | Monthly | 90,800 | April-2019 | 24,556,878 | — | 267,134 | 267,134 | ||||||||||||||||||||||||||||
Macquarie Bank Ltd. | Receive | Macquarie Aluminum Dynamic Selection Index | 0.30 | Monthly | 1,163,000 | December-2018 | 68,842,041 | — | 178,172 | 178,172 | ||||||||||||||||||||||||||||
Macquarie Bank Ltd. | Receive | Modified Macquarie Single Commodity Sugar type A Excess Return Index | 0.34 | Monthly | 183,000 | January-2019 | 27,144,445 | — | 1,059,826 | 1,059,826 | ||||||||||||||||||||||||||||
Merrill Lynch International | Receive | Merrill Lynch Gold Excess Return Index | 0.14 | Monthly | 342,800 | June-2018 | 57,055,803 | — | 0 | 0 | ||||||||||||||||||||||||||||
Merrill Lynch International | Receive | MLCXLXAE Excess Return Index | 0.25 | Monthly | 48,700 | March-2019 | 13,457,758 | — | 0 | 0 | ||||||||||||||||||||||||||||
Merrill Lynch International | Receive | MLCX Dynamic Enhanced Copper Excess Return Index | 0.25 | Monthly | 78,200 | September-2018 | 51,659,624 | — | 0 | 0 | ||||||||||||||||||||||||||||
Merrill Lynch International | Receive | MLCX Natural Gas Annual Excess Return Index | 0.25 | Monthly | 777,000 | November-2018 | 32,582,772 | — | 0 | 0 | ||||||||||||||||||||||||||||
Royal Bank of Canada | Receive | RBC Enhanced Brent Crude Oil 01 Excess Return Index | 0.35 | Monthly | 149,500 | March-2018 | 53,142,032 | — | 0 | 0 | ||||||||||||||||||||||||||||
Royal Bank of Canada | Receive | RBC Enhanced Copper LME 01 Excess Return Index | 0.28 | Monthly | 12,400 | June-2018 | 7,696,751 | — | 0 | 0 | ||||||||||||||||||||||||||||
Royal Bank of Canada | Receive | RBC Gold E0 Excess Return Index | 0.12 | Monthly | 33,800 | August-2018 | 11,623,915 | — | 0 | 0 | ||||||||||||||||||||||||||||
Subtotal — Appreciation |
| — | 4,573,391 | 4,573,391 | ||||||||||||||||||||||||||||||||||
Barclays Bank PLC | Receive | Barclays Soybeans Seasonal Excess Return Index | 0.30 | Monthly | 151,000 | May-2018 | 44,950,511 | — | (202,733 | ) | (202,733 | ) | ||||||||||||||||||||||||||
Canadian Imperial Bank of Commerce | Receive | CIBC Dynamic Roll LME Copper Excess Return Index 2 | 0.30 | Monthly | 565,000 | April-2019 | 49,521,118 | — | (1,039,898 | ) | (1,039,898 | ) | ||||||||||||||||||||||||||
Goldman Sachs International | Receive | Enhanced Strategy Sugar A141 on the S&P GSCI Sugar Excess Return Index | 0.37 | Monthly | 281,000 | March-2019 | 50,268,090 | — | (3,177,885 | ) | (3,177,885 | ) | ||||||||||||||||||||||||||
JPMorgan Chase Bank, N.A. | Receive | S&P GSCI Gold Index Excess Return | 0.09 | Monthly | 537,500 | October-2018 | 57,291,426 | — | (207,744 | ) | (207,744 | ) | ||||||||||||||||||||||||||
Macquarie Bank Ltd. | Receive | Macquarie Single Commodity Silver type A Excess Return Index | 0.16 | Monthly | 285,500 | December-2018 | 54,267,155 | — | (576,139 | ) | (576,139 | ) | ||||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Receive | MS Soybean Oil Dynamic Roll Index | 0.30 | Monthly | 153,000 | April-2019 | 22,043,062 | — | (251,486 | ) | (251,486 | ) | ||||||||||||||||||||||||||
Subtotal — Depreciation |
| — | (5,455,885 | ) | (5,455,885 | ) | ||||||||||||||||||||||||||||||||
Total Open Over-The-Counter Total Return Swap Agreements —Commodity Risk |
| $ | — | $ | (882,494 | ) | $ | (882,494 | ) |
Investment Abbreviations:
Barclays Diversified Energy-Metals Total Return Index | — a basket of indices that provide exposure to various components of the energy and metals markets. The underlying commodities comprising the indices are: Brent Crude Oil, Copper, Gasoil, Gold, Silver, Unleaded Gasoline, and WTI Crude Oil. | |
LIBOR | – London Interbank Offered Rate | |
USD | – U.S. Dollar |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
6 Invesco Balanced-Risk Commodity Strategy Fund
Notes to Schedule of Investments:
(a) | Security traded on a discount basis. The interest rate shown represents the discount rate at the time of purchase by the Fund. |
(b) | All or a portion of the value was pledged as collateral to cover margin requirements for open futures contracts. See Note 1J. |
(c) | Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on April 30, 2018. |
(d) | Security purchased or received in transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The value of this security at April 30, 2018 represented 3.32% of the Fund’s Net Assets. |
(e) | Affiliated company. The security and the Fund are affiliated by having the same investment adviser. See Note 5. |
(f) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
(g) | The Fund receives or pays payments based on any positive or negative return on the Reference Entity, respectively. |
(h) | Open Over-The-Counter Total Return swap agreements are collateralized by cash held with Counterparties in the amount of $56,599,780. |
(i) | The table below includes additional information regarding the underlying components of certain reference entities that are not publicly available. |
Reference Entity Components | ||||||
Reference Entity | Underlying Components | Percentage | ||||
Barclays Heating Oil Roll Yield Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Heating Oil | 100 | % | ||||
Barclays Live Cattle Roll Yield Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Live Cattle | 100 | % | ||||
Barclays WTI Crude Roll Yield Excess Return Index |
| |||||
Long Futures Contracts | ||||||
WTI Crude | 100 | % | ||||
Enhanced Strategy AB31 on the S&P GSCI Cotton Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Cotton No. 2 | 100 | % | ||||
S&P GSCI Soybean Meal Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Soybean Meal | 100 | % | ||||
J.P. Morgan Contag Beta Gas Oil Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Gas Oil | 100 | % | ||||
Macquarie Aluminum Dynamic Selection Index |
| |||||
Long Futures Contracts | ||||||
Aluminum | 100 | % | ||||
Modified Macquarie Single Commodity Sugar type A Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Sugar | 100 | % | ||||
Merrill Lynch Gold Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Gold | 100 | % | ||||
MLCXLXAE Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Zinc | 100 | % | ||||
MLCX Dynamic Enhanced Copper Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Copper | 100 | % | ||||
MLCX Natural Gas Annual Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Natural Gas | 100 | % | ||||
RBC Enhanced Brent Crude Oil 01 Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Brent Crude | 100 | % | ||||
RBC Enhanced Copper LME 01 Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Copper | 100 | % |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
7 Invesco Balanced-Risk Commodity Strategy Fund
Reference Entity Components—(continued) | ||||||
Reference Entity | Underlying Components | Percentage | ||||
RBC Gold E0 Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Gold | 100 | % | ||||
Barclays Soybeans Seasonal Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Soybeans | 100 | % | ||||
CIBC Dynamic Roll LME Copper Excess Return Index 2 |
| |||||
Long Futures Contracts | ||||||
Copper | 100 | % | ||||
Enhanced Strategy Sugar A141 on the S&P GSCI Sugar Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Sugar | 100 | % | ||||
S&P GSCI Gold Index Excess Return |
| |||||
Long Futures Contracts | ||||||
Gold | 100 | % | ||||
Macquarie Single Commodity Silver type A Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Silver | 100 | % | ||||
MS Soybean Oil Dynamic Roll Index |
| |||||
Long Futures Contracts | ||||||
Soybean Oil | 100 | % |
Target Risk Allocation and Notional Asset Weights
By asset class, based on Net Assets
as of April 30, 2018
Asset Class | Target Risk Allocation* | % of Net Assets as of 04/30/18** | ||||||
Agriculture | 36.64 | % | 45.75 | % | ||||
Energy | 34.31 | 31.32 | ||||||
Industrial Metals | 14.80 | 19.52 | ||||||
Precious Metals | 14.25 | 21.82 | ||||||
Total | 100.00 | % | 118.41 | % |
* | Reflects the risk that each asset class is expected to contribute to the overall risk of the Fund as measured by standard deviation and estimates of risk based on historical data. Standard deviation measures the annualized fluctuations (volatility) of monthly returns. |
** | Proprietary models determine the Notional Asset Weights necessary to achieve the Target Risk Allocations. Total Notional Asset Weight greater than 100% is achieved through derivatives and other instruments that create leverage. |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
8 Invesco Balanced-Risk Commodity Strategy Fund
Consolidated Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: | ||||
Investments in securities, at value (Cost $362,545,461) | $ | 378,626,890 | ||
Investments in affiliates, at value (Cost $718,141,496) | 714,926,642 | |||
Other investments: | ||||
Variation margin receivable — futures contracts | 190,412 | |||
Swaps receivable — OTC | 4,770,852 | |||
Unrealized appreciation on swap agreements — OTC | 4,573,391 | |||
Deposits with brokers: | ||||
Cash collateral — OTC Derivatives | 56,599,780 | |||
Cash | 5,339,530 | |||
Receivable for: | ||||
Fund shares sold | 5,749,018 | |||
Dividends and interest | 993,761 | |||
Investment for trustee deferred compensation and retirement plans | 77,568 | |||
Other assets | 68,716 | |||
Total assets | 1,171,916,560 | |||
Liabilities: | ||||
Other investments: | ||||
Swaps payable — OTC | 1,780,203 | |||
Unrealized depreciation on swap agreements — OTC | 5,455,885 | |||
Payable for: | ||||
Investments purchased | 30,000,000 | |||
Fund shares reacquired | 1,162,568 | |||
Accrued fees to affiliates | 336,945 | |||
Accrued trustees’ and officers’ fees and benefits | 2,405 | |||
Accrued other operating expenses | 173,290 | |||
Trustee deferred compensation and retirement plans | 136,674 | |||
Total liabilities | 39,047,970 | |||
Net assets applicable to shares outstanding | $ | 1,132,868,590 | ||
Net assets consist of: | ||||
Shares of beneficial interest | $ | 1,116,470,510 | ||
Undistributed net investment income | (2,965,454 | ) | ||
Undistributed net realized gain (loss) | (3,948,217 | ) | ||
Net unrealized appreciation | 23,311,751 | |||
$ | 1,132,868,590 |
Net Assets: |
| |||
Class A | $ | 45,163,354 | ||
Class C | $ | 10,049,988 | ||
Class R | $ | 1,954,572 | ||
Class Y | $ | 857,305,572 | ||
Class R5 | $ | 200,367,061 | ||
Class R6 | $ | 18,028,043 | ||
Shares outstanding, no par value, |
| |||
Class A | 6,391,460 | |||
Class C | 1,493,532 | |||
Class R | 280,304 | |||
Class Y | 119,103,471 | |||
Class R5 | 27,733,270 | |||
Class R6 | 2,489,361 | |||
Class A: | ||||
Net asset value per share | $ | 7.07 | ||
Maximum offering price per share | ||||
(Net asset value of $7.07 ¸ 94.50%) | $ | 7.48 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 6.73 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 6.97 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 7.20 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 7.22 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 7.24 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
9 Invesco Balanced-Risk Commodity Strategy Fund
Consolidated Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: | ||||
Dividends from affiliates | $ | 3,839,467 | ||
Interest | 2,595,720 | |||
Total investment income | 6,435,187 | |||
Expenses: | ||||
Advisory fees | 4,966,160 | |||
Administrative services fees | 125,672 | |||
Custodian fees | 24,187 | |||
Distribution fees: | ||||
Class A | 55,530 | |||
Class B | 146 | |||
Class C | 40,042 | |||
Class R | 4,465 | |||
Transfer agent fees — A, B, C, R and Y | 641,488 | |||
Transfer agent fees — R5 | 99,991 | |||
Transfer agent fees — R6 | 203 | |||
Trustees’ and officers’ fees and benefits | 18,244 | |||
Registration and filing fees | 69,030 | |||
Reports to shareholders | 92,897 | |||
Professional services fees | 69,225 | |||
Other | 16,965 | |||
Total expenses | 6,224,245 | |||
Less: Fees waived and expense offset arrangement(s) | (370,802 | ) | ||
Net expenses | 5,853,443 | |||
Net investment income | 581,744 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain from: | ||||
Investment securities | 9,439,362 | |||
Futures contracts | 5,109,803 | |||
Swap agreements | 25,300,332 | |||
39,849,497 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | 3,823,693 | |||
Futures contracts | 12,708,263 | |||
Swap agreements | (4,880,252 | ) | ||
11,651,704 | ||||
Net realized and unrealized gain | 51,501,201 | |||
Net increase in net assets resulting from operations | $ | 52,082,945 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
10 Invesco Balanced-Risk Commodity Strategy Fund
Consolidated Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: | ||||||||
Net investment income (loss) | $ | 581,744 | $ | (4,538,717 | ) | |||
Net realized gain (loss) | 39,849,497 | (9,638,258 | ) | |||||
Change in net unrealized appreciation | 11,651,704 | 16,822,397 | ||||||
Net increase in net assets resulting from operations | 52,082,945 | 2,645,422 | ||||||
Distributions to shareholders from net investment income: | ||||||||
Class A | — | (1,091,128 | ) | |||||
Class B | — | (3,367 | ) | |||||
Class C | — | (160,205 | ) | |||||
Class R | — | (18,396 | ) | |||||
Class Y | (89,361 | ) | (16,712,187 | ) | ||||
Class R5 | (66,877 | ) | (5,253,994 | ) | ||||
Class R6 | (5,557 | ) | (56,525 | ) | ||||
Total distributions from net investment income | (161,795 | ) | (23,295,802 | ) | ||||
Share transactions–net: | ||||||||
Class A | (13,459,921 | ) | 16,448,650 | |||||
Class B | (65,998 | ) | (85,660 | ) | ||||
Class C | 2,594,633 | 1,425,627 | ||||||
Class R | 179,032 | 892,561 | ||||||
Class Y | 242,519,157 | 19,012,305 | ||||||
Class R5 | (16,218,792 | ) | 12,788,459 | |||||
Class R6 | 4,937,052 | 10,313,107 | ||||||
Net increase in net assets resulting from share transactions | 220,485,163 | 60,795,049 | ||||||
Net increase in net assets | 272,406,313 | 40,144,669 | ||||||
Net assets: | ||||||||
Beginning of period | 860,462,277 | 820,317,608 | ||||||
End of period (includes undistributed net investment income (loss) of $(2,965,454) and $(3,385,403), respectively) | $ | 1,132,868,590 | $ | 860,462,277 |
Notes to Consolidated Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Balanced-Risk Commodity Strategy Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these consolidated financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund will seek to gain exposure to the commodity markets primarily through investments in the Invesco Cayman Commodity Fund III Ltd. (the “Subsidiary”), a wholly-owned subsidiary of the Fund organized under the laws of the Cayman Islands. The Subsidiary was organized by the Fund to invest in commodity-linked derivatives and other securities that may provide leveraged and non-leveraged exposure to commodities. The Fund may invest up to 25% of its total assets in the Subsidiary.
The Fund’s investment objective is to provide total return.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Effective November 30, 2010, new or additional investments in Class B shares are no longer permitted. Existing shareholders of Class B shares were permitted to continue to reinvest dividends and capital gains distributions in Class B shares until their conversion to Class A shares. Also, shareholders in Class B shares were able to exchange those shares for Class B shares of other Invesco Funds offering such shares until they converted to Class A shares. Generally, Class B shares automatically converted to Class A shares on or about the
11 Invesco Balanced-Risk Commodity Strategy Fund
month-end, which was at least eight years after the date of purchase. Redemptions of Class B shares prior to the conversion date were subject to a CDSC. Effective January 26, 2018, all of the Fund’s outstanding Class B shares were converted to Class A shares, in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its consolidated financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the consolidated financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
12 Invesco Balanced-Risk Commodity Strategy Fund
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Consolidated Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Consolidated Statement of Operations and the Consolidated Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Consolidated Statement of Operations and the Consolidated Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Consolidated Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the consolidated financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Subsidiary is classified as a controlled foreign corporation under Subchapter N of the Internal Revenue Code. Therefore, the Fund is required to increase its taxable income by its share of the Subsidiary’s income. Net investment losses of the Subsidiary cannot be deducted by the Fund in the current period nor carried forward to offset taxable income in future periods.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The financial statements are prepared on a consolidated basis in conformity with accounting principles generally accepted in the United States of America (“GAAP”), which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. The accompanying financial statements reflect the financial position of the Fund and its Subsidiary and the results of operations on a consolidated basis. All inter-company accounts and transactions have been eliminated in consolidation. |
In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the consolidated financial statements are released to print.
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust, and under the Subsidiary’s organizational documents, the directors and officers of the Subsidiary, are indemnified against certain liabilities that may arise out of the performance of their duties to the Fund and/or the Subsidiary, respectively. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Structured Securities — The Fund may invest in structured securities. Structured securities are a type of derivative security whose value is determined by reference to changes in the value of underlying securities, currencies, interest rates, commodities, indices or other financial indicators (“reference instruments”). Most structured securities are fixed-income securities that have maturities of three years or less. Structured securities may be positively or negatively indexed (i.e., their principal value or interest rates may increase or decrease if the underlying reference instrument appreciates) and may have return characteristics similar to direct investments in the underlying reference instrument. |
Structured securities may entail a greater degree of market risk than other types of debt securities because the investor bears the risk of the reference instruments. In addition to the credit risk of structured securities and the normal risks of price changes in response to changes in interest rates, the principal amount of structured notes or indexed securities may decrease as a result of changes in the value of the underlying reference instruments. Changes in the daily value of structured securities are recorded as unrealized gains (losses) in the Consolidated Statement
13 Invesco Balanced-Risk Commodity Strategy Fund
of Operations. When the structured securities mature or are sold, the Fund recognizes a realized gain (loss) on the Consolidated Statement of Operations.
J. | Futures Contracts — The Fund may enter into futures contracts to equitize the Fund’s cash holdings or to manage exposure to interest rate, equity and market price movements and/or currency risks. A futures contract is an agreement between two parties (“Counterparties”) to purchase or sell a specified underlying security, currency or commodity (or delivery of a cash settlement price, in the case of an index future) for a fixed price at a future date. The Fund currently invests only in exchange-traded futures and they are standardized as to maturity date and underlying financial instrument. Initial margin deposits required upon entering into futures contracts are satisfied by the segregation of specific securities or cash as collateral at the futures commission merchant (broker). During the period the futures contracts are open, changes in the value of the contracts are recognized as unrealized gains or losses by recalculating the value of the contracts on a daily basis. Subsequent or variation margin payments are received or made on non-LME futures contracts depending upon whether unrealized gains or losses are incurred. These amounts are reflected as receivables or payables on the Consolidated Statement of Assets and Liabilities. For LME contracts, subsequent or variation margin payments are not made and the value of the contracts is presented as unrealized appreciation or depreciation on the Statement of Assets and Liabilities. When LME or non-LME contracts are closed or expire, the Fund recognizes a realized gain or loss equal to the difference between the proceeds from, or cost of, the closing transaction and the Fund’s basis in the contract. The net realized gain (loss) and the change in unrealized gain (loss) on futures contracts held during the period is included on the Consolidated Statement of Operations. The primary risks associated with futures contracts are market risk and the absence of a liquid secondary market. If the Fund were unable to liquidate a futures contract and/or enter into an offsetting closing transaction, the Fund would continue to be subject to market risk with respect to the value of the contracts and continue to be required to maintain the margin deposits on the futures contracts. Futures contracts have minimal Counterparty risk since the exchange’s clearinghouse, as Counterparty to all exchange-traded futures, guarantees the futures against default. Risks may exceed amounts recognized in the Consolidated Statement of Assets and Liabilities. |
K. | Swap Agreements — The Fund may enter into various swap transactions, including interest rate, total return, index, currency and credit default swap contracts (“CDS”) for investment purposes or to manage interest rate, currency, commodity or credit risk. Such transactions are agreements between Counterparties. These agreements may contain among other conditions, events of default and termination events, and various covenants and representations such as provisions that require the Fund to maintain a pre-determined level of net assets, and/or provide limits regarding the decline of the Fund’s NAV over specific periods of time. If the Fund were to trigger such provisions and have open derivative positions at that time, the Counterparty may be able to terminate such agreement and request immediate payment in an amount equal to the net liability positions, if any. |
Interest rate, total return, index, and currency swap agreements are two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a notional amount, i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate or return of an underlying asset, in a particular foreign currency, or in a “basket” of securities representing a particular index. At the maturity date, a net cash flow is exchanged where the total return is equivalent to the return of the underlying reference less a financing rate, if any. As a receiver, the Fund would receive payments based on any positive total return and would owe payments in the event of a negative total return. As the payer, the Fund would owe payments on any net positive total return, and would receive payment in the event of a negative total return.
Changes in the value of swap agreements are recognized as unrealized gains (losses) in the Consolidated Statement of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Consolidated Statement of Assets and Liabilities and may be referred to as upfront payments. The Fund accrues for the fixed payment stream and amortizes upfront payments, if any, on swap agreements on a daily basis with the net amount, recorded as a component of realized gain (loss) on the Consolidated Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Consolidated Statement of Operations. The Fund segregates cash or liquid securities having a value at least equal to the amount of the potential obligation of a Fund under any swap transaction. Cash held as collateral is recorded as deposits with brokers on the Consolidated Statement of Assets and Liabilities. Entering into these agreements involves, to varying degrees, lack of liquidity and elements of credit, market, and Counterparty risk in excess of amounts recognized on the Consolidated Statement of Assets and Liabilities. Such risks involve the possibility that a swap is difficult to sell or liquidate; the Counterparty does not honor its obligations under the agreement and unfavorable interest rates and market fluctuations. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund’s exposure is unlimited.
L. | Other Risks — The Fund will seek to gain exposure to commodity markets primarily through an investment in the Subsidiary and through investments in exchange-traded funds and commodity-linked derivatives. The Subsidiary, unlike the Fund, may invest without limitation in commodities, commodity-linked derivatives and other securities, such as exchange-traded and commodity-linked notes, that may provide leveraged and non-leveraged exposure to commodity markets. The Fund is indirectly exposed to the risks associated with the Subsidiary’s investments. |
M. | Leverage Risk — Leverage exists when the Fund can lose more than it originally invests because it purchases or sells an instrument or enters into a transaction without investing an amount equal to the full economic exposure of the instrument or transaction. |
N. | Collateral — To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund’s practice to replace such collateral no later than the next business day. |
14 Invesco Balanced-Risk Commodity Strategy Fund
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser less the amount paid by the Subsidiary to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||||||
First $250 million | 1 | .05% | ||||||
Next $250 million | 1 | .025% | ||||||
Next $500 million | 1 | .00% | ||||||
Next $1.5 billion | 0 | .975% | ||||||
Next $2.5 billion | 0 | .95% | ||||||
Next $2.5 billion | 0 | .925% | ||||||
Next $2.5 billion | 0 | .90% | ||||||
Over $10 billion | 0 | .875% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 1.02%.
The Subsidiary has entered into a separate contract with the Adviser whereby the Adviser provides investment advisory and other services to the Subsidiary. In consideration of these services, the Subsidiary pays an advisory fee to the Adviser based on the annual rate of the Subsidiary’s average daily net assets as set forth in the table above.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waivers and/or reimbursements (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.00%, 2.75%, 2.25%, 1.75%, 1.75% and 1.75%, respectively, of the Fund’s average daily net assets (the “expense limits”). Prior to their conversion to Class A shares, the expense limit for Class B shares was 2.75% of average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Acquired Fund Fees and Expenses are not operating expenses of the Fund directly, but are fees and expenses, including management fees, of the investment companies in which the Fund invests. As a result, the total annual fund operating expenses after expense reimbursement may exceed the expense limits above. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives on the Fund’s investments in certain affiliated funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $370,056.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Consolidated Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Consolidated Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. Prior to their conversion to Class A shares, the Fund paid an annual rate of 1.00% of the average daily net assets of Class B shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Consolidated Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption
15 Invesco Balanced-Risk Commodity Strategy Fund
proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $16,369 in front-end sales commissions from the sale of Class A shares and $1,080 from Class C shares for CDSC imposed on redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
U.S. Treasury Securities | $ | — | $ | 311,374,546 | $ | — | $ | 311,374,546 | ||||||||
Commodity-Linked Securities | — | 67,252,344 | — | 67,252,344 | ||||||||||||
Exchange-Traded Fund | 10,805,601 | — | — | 10,805,601 | ||||||||||||
Money Market Funds | 704,121,041 | — | — | 704,121,041 | ||||||||||||
Total Investments in Securities | 714,926,642 | 378,626,890 | — | 1,093,553,532 | ||||||||||||
Other Investments — Assets* | ||||||||||||||||
Futures Contracts | 11,327,670 | — | — | 11,327,670 | ||||||||||||
Swap Agreements | — | 4,573,391 | — | 4,573,391 | ||||||||||||
11,327,670 | 4,573,391 | — | 15,901,061 | |||||||||||||
Other Investments — Liabilities* | ||||||||||||||||
Swap Agreements | — | (5,455,885 | ) | — | (5,455,885 | ) | ||||||||||
Total Other Investments | 11,327,670 | (882,494 | ) | — | 10,445,176 | |||||||||||
Total Investments | $ | 726,254,312 | $ | 377,744,396 | $ | — | $ | 1,103,998,708 |
* | Unrealized appreciation (depreciation). |
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Consolidated Statement of Assets and Liabilities.
16 Invesco Balanced-Risk Commodity Strategy Fund
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2018:
Value | ||||
Derivative Assets | Commodity Risk | |||
Unrealized appreciation on futures contracts — Exchange-Traded(a) | $ | 11,327,670 | ||
Unrealized appreciation on swap agreements — OTC | 4,573,391 | |||
Total Derivative Assets | 15,901,061 | |||
Derivatives not subject to master netting agreements | (11,327,670 | ) | ||
Total Derivative Assets subject to master netting agreements | $ | 4,573,391 |
Value | ||||
Derivative Liabilities | Commodity Risk | |||
Unrealized depreciation on swap agreements — OTC | $ | (5,455,885 | ) | |
Derivatives not subject to master netting agreements | — | |||
Total Derivative Liabilities subject to master netting agreements | $ | (5,455,885 | ) |
(a) | The daily variation margin receivable at period-end is recorded in the Consolidated Statement of Assets and Liabilities. |
Offsetting Assets and Liabilities
The table below reflects the Fund’s exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of April 30, 2018.
Financial Derivative Assets | Financial Derivative Liabilities | Collateral (Received)/Pledged | ||||||||||||||||||||||
Counterparty | Swap Agreements | Swap Agreements | Net Value of Derivatives | Non-Cash | Cash | Net Amount | ||||||||||||||||||
Subsidiary | ||||||||||||||||||||||||
Barclays Bank PLC | $ | 2,842,224 | $ | (218,623 | ) | $ | 2,623,601 | $ | — | $ | — | $ | 2,623,601 | |||||||||||
Canadian Imperial Bank of Commerce | — | (1,048,445 | ) | (1,048,445 | ) | — | 1,048,445 | — | ||||||||||||||||
Goldman Sachs International | 226,035 | (3,219,542 | ) | (2,993,507 | ) | — | 2,993,507 | — | ||||||||||||||||
JPMorgan Chase Bank, N.A. | 267,134 | (209,883 | ) | 57,251 | — | — | 57,251 | |||||||||||||||||
Macquarie Bank Ltd. | 1,237,998 | (582,478 | ) | 655,520 | — | — | 655,520 | |||||||||||||||||
Merrill Lynch International | 645,113 | (1,616,230 | ) | (971,117 | ) | — | 971,117 | — | ||||||||||||||||
Morgan Stanley Capital Services LLC | — | (252,573 | ) | (252,573 | ) | — | — | (252,573 | ) | |||||||||||||||
Royal Bank of Canada | 4,125,739 | (88,314 | ) | 4,037,425 | — | — | 4,037,425 | |||||||||||||||||
Total | $ | 9,344,243 | $ | (7,236,088 | ) | $ | 2,108,155 | $ | — | $ | 5,013,069 | $ | 7,121,224 |
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Consolidated Statement of Operations | ||||
Commodity Risk | ||||
Realized Gain: | ||||
Futures contracts | $ | 5,109,803 | ||
Swap agreements | 25,300,332 | |||
Change in Net Unrealized Appreciation (Depreciation): | ||||
Futures contracts | 12,708,263 | |||
Swap agreements | (4,880,252 | ) | ||
Total | $ | 38,238,146 |
The table below summarizes the average notional value of futures contracts and swap agreements outstanding during the period.
Futures Contracts | Swap Agreements | |||||||
Average notional value | $ | 233,611,943 | $ | 742,195,617 |
17 Invesco Balanced-Risk Commodity Strategy Fund
NOTE 5—Investments in Affiliates
The Fund’s Adviser and the adviser for Invesco DB Gold Fund are subsidiaries of Invesco Ltd. and therefore, Invesco DB Gold Fund is considered to be affiliated with the Fund. The following is a summary of the transactions in, and earnings from, investments in Invesco DB Gold Fund for the six months ended April 30, 2018.
Value 10/31/17 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation | Realized Gain (Loss) | Value 04/30/18 | Dividend Income | ||||||||||||||||||||||
Invesco DB Gold Fund | $ | 8,284,050 | $ | 2,343,451 | $ | — | $ | 178,100 | $ | — | $ | 10,805,601 | $ | 8,614 |
NOTE 6—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $746.
NOTE 7—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 8—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Consolidated Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 9—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund had a capital loss carryforward as of October 31, 2017, as follows:
Capital Loss Carryforward* | ||||||||||||
Expiration | Short-Term | Long-Term | Total | |||||||||
Not subject to expiration | $ | 40,365,516 | $ | 5,005,707 | $ | 45,371,223 |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
18 Invesco Balanced-Risk Commodity Strategy Fund
NOTE 10—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $32,343,450 and $29,679,430, respectively. During the same period, purchases and sales of U.S. Treasury obligations were $126,880,000 and $115,890,000, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 38,192,690 | ||
Aggregate unrealized (depreciation) of investments | (13,685,469 | ) | ||
Net unrealized appreciation of investments | $ | 24,507,221 |
Cost of investments for tax purposes is $1,079,491,488.
NOTE 11—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 2,052,145 | $ | 14,146,938 | 4,563,865 | $ | 30,361,277 | ||||||||||
Class C | 585,429 | 3,899,539 | 632,764 | 4,089,805 | ||||||||||||
Class R | 75,172 | 514,572 | 210,342 | 1,356,759 | ||||||||||||
Class Y | 52,067,439 | 366,629,005 | 67,828,430 | 461,730,692 | ||||||||||||
Class R5 | 136,616 | 966,545 | 2,861,151 | 18,947,101 | ||||||||||||
Class R6 | 842,420 | 5,978,686 | 2,043,846 | 13,792,890 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | — | — | 149,749 | 1,006,312 | ||||||||||||
Class B(b) | — | — | 396 | 2,565 | ||||||||||||
Class C | — | — | 22,851 | 147,620 | ||||||||||||
Class R | — | — | 2,740 | 18,221 | ||||||||||||
Class Y | 8,118 | 54,310 | 1,163,388 | 7,934,306 | ||||||||||||
Class R5 | 9,913 | 66,518 | 763,850 | 5,224,733 | ||||||||||||
Class R6 | 825 | 5,556 | 8,252 | 56,525 | ||||||||||||
Conversion of Class B shares to Class A shares:(c) | ||||||||||||||||
Class A | 8,756 | 62,252 | 7,534 | 49,496 | ||||||||||||
Class B | (9,155 | ) | (62,252 | ) | (7,837 | ) | (49,496 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (4,106,984 | ) | (27,669,111 | ) | (2,258,911 | ) | (14,968,435 | ) | ||||||||
Class B(b) | (568 | ) | (3,746 | ) | (5,968 | ) | (38,729 | ) | ||||||||
Class C | (198,462 | ) | (1,304,906 | ) | (449,948 | ) | (2,811,798 | ) | ||||||||
Class R | (49,166 | ) | (335,540 | ) | (74,400 | ) | (482,419 | ) | ||||||||
Class Y | (17,643,593 | ) | (124,164,158 | ) | (67,046,653 | ) | (450,652,693 | ) | ||||||||
Class R5 | (2,461,648 | ) | (17,251,855 | ) | (1,674,504 | ) | (11,383,375 | ) | ||||||||
Class R6 | (147,122 | ) | (1,047,190 | ) | (541,057 | ) | (3,536,308 | ) | ||||||||
Net increase in share activity | 31,170,135 | $ | 220,485,163 | 8,199,880 | $ | 60,795,049 |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 83% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
(b) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(c) | Effective as of the close of business on January 26, 2018, all outstanding Class B shares were converted to Class A shares. |
19 Invesco Balanced-Risk Commodity Strategy Fund
NOTE 12—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 6.70 | $ | (0.00 | ) | $ | 0.37 | $ | 0.37 | $ | — | $ | 7.07 | 5.52 | % | $ | 45,163 | 1.44 | %(d) | 1.52 | %(d) | (0.12 | )%(d) | 63 | % | |||||||||||||||||||||||
Year ended 10/31/17 | 6.84 | (0.05 | ) | 0.08 | 0.03 | (0.17 | ) | 6.70 | 0.47 | 56,532 | 1.49 | 1.56 | (0.78 | ) | 10 | |||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.54 | (0.07 | ) | 0.37 | 0.30 | — | 6.84 | 4.59 | 40,844 | 1.47 | 1.56 | (1.11 | ) | 98 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 8.04 | (0.10 | ) | (1.40 | ) | (1.50 | ) | — | 6.54 | (18.66 | ) | 34,892 | 1.55 | 1.59 | (1.47 | ) | 17 | |||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.05 | (0.11 | ) | (0.90 | ) | (1.01 | ) | — | 8.04 | (11.16 | ) | 47,339 | 1.30 | 1.57 | (1.25 | ) | 21 | |||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.73 | (0.11 | ) | (1.35 | ) | (1.46 | ) | (0.22 | ) | 9.05 | (13.89 | ) | 69,350 | 1.22 | 1.47 | (1.14 | ) | 47 | ||||||||||||||||||||||||||||||
Class B | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18(e) | 6.42 | (0.01 | ) | 0.39 | 0.38 | — | 6.80 | 5.92 | — | 2.19 | (d) | 2.27 | (d) | (0.87 | )(d) | 63 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.58 | (0.10 | ) | 0.09 | 0.01 | (0.15 | ) | 6.42 | (0.19 | ) | 62 | 2.24 | 2.31 | (1.53 | ) | 10 | ||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.34 | (0.12 | ) | 0.36 | 0.24 | — | 6.58 | 3.79 | 152 | 2.22 | 2.31 | (1.86 | ) | 98 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 7.85 | (0.16 | ) | (1.35 | ) | (1.51 | ) | — | 6.34 | (19.24 | ) | 258 | 2.30 | 2.34 | (2.22 | ) | 17 | |||||||||||||||||||||||||||||||
Year ended 10/31/14 | 8.91 | (0.17 | ) | (0.89 | ) | (1.06 | ) | — | 7.85 | (11.90 | ) | 514 | 2.05 | 2.32 | (2.00 | ) | 21 | |||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.59 | (0.18 | ) | (1.33 | ) | (1.51 | ) | (0.17 | ) | 8.91 | (14.44 | ) | 1,096 | 1.97 | 2.22 | (1.89 | ) | 47 | ||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 6.40 | (0.03 | ) | 0.36 | 0.33 | — | 6.73 | 5.16 | 10,050 | 2.19 | (d) | 2.27 | (d) | (0.87 | )(d) | 63 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.57 | (0.10 | ) | 0.08 | (0.02 | ) | (0.15 | ) | 6.40 | (0.34 | ) | 7,086 | 2.24 | 2.31 | (1.53 | ) | 10 | |||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.33 | (0.12 | ) | 0.36 | 0.24 | — | 6.57 | 3.79 | 5,915 | 2.22 | 2.31 | (1.86 | ) | 98 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 7.84 | (0.15 | ) | (1.36 | ) | (1.51 | ) | — | 6.33 | (19.26 | ) | 2,544 | 2.30 | 2.34 | (2.22 | ) | 17 | |||||||||||||||||||||||||||||||
Year ended 10/31/14 | 8.89 | (0.17 | ) | (0.88 | ) | (1.05 | ) | — | 7.84 | (11.81 | ) | 3,612 | 2.05 | 2.32 | (2.00 | ) | 21 | |||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.58 | (0.18 | ) | (1.34 | ) | (1.52 | ) | (0.17 | ) | 8.89 | (14.55 | ) | 4,948 | 1.97 | 2.22 | (1.89 | ) | 47 | ||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 6.62 | (0.01 | ) | 0.36 | 0.35 | — | 6.97 | 5.29 | 1,955 | 1.69 | (d) | 1.77 | (d) | (0.37 | )(d) | 63 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.76 | (0.07 | ) | 0.09 | 0.02 | (0.16 | ) | 6.62 | 0.35 | 1,683 | 1.74 | 1.81 | (1.03 | ) | 10 | |||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.48 | (0.09 | ) | 0.37 | 0.28 | — | 6.76 | 4.32 | 782 | 1.72 | 1.81 | (1.36 | ) | 98 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 7.99 | (0.12 | ) | (1.39 | ) | (1.51 | ) | — | 6.48 | (18.90 | ) | 363 | 1.80 | 1.84 | (1.72 | ) | 17 | |||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.02 | (0.13 | ) | (0.90 | ) | (1.03 | ) | — | 7.99 | (11.42 | ) | 371 | 1.55 | 1.82 | (1.50 | ) | 21 | |||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.71 | (0.13 | ) | (1.36 | ) | (1.49 | ) | (0.20 | ) | 9.02 | (14.13 | ) | 504 | 1.47 | 1.72 | (1.39 | ) | 47 | ||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 6.82 | 0.00 | 0.38 | 0.38 | (0.00 | ) | 7.20 | 5.59 | 857,306 | 1.19 | (d) | 1.27 | (d) | 0.13 | (d) | 63 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.95 | (0.04 | ) | 0.10 | 0.06 | (0.19 | ) | 6.82 | 0.80 | 577,236 | 1.24 | 1.31 | (0.53 | ) | 10 | |||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.63 | (0.06 | ) | 0.38 | 0.32 | — | 6.95 | 4.83 | 574,878 | 1.22 | 1.31 | (0.86 | ) | 98 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 8.13 | (0.09 | ) | (1.41 | ) | (1.50 | ) | — | 6.63 | (18.45 | ) | 217,528 | 1.30 | 1.34 | (1.22 | ) | 17 | |||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.13 | (0.09 | ) | (0.91 | ) | (1.00 | ) | — | 8.13 | (10.95 | ) | 268,106 | 1.05 | 1.32 | (1.00 | ) | 21 | |||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.81 | (0.09 | ) | (1.36 | ) | (1.45 | ) | (0.23 | ) | 9.13 | (13.69 | ) | 250,463 | 0.97 | 1.22 | (0.89 | ) | 47 | ||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 6.84 | 0.01 | 0.37 | 0.38 | (0.00 | ) | 7.22 | 5.60 | 200,367 | 1.12 | (d) | 1.20 | (d) | 0.20 | (d) | 63 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.97 | (0.03 | ) | 0.09 | 0.06 | (0.19 | ) | 6.84 | 0.83 | 205,568 | 1.16 | 1.23 | (0.45 | ) | 10 | |||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.64 | (0.05 | ) | 0.38 | 0.33 | — | 6.97 | 4.97 | 195,777 | 1.13 | 1.22 | (0.77 | ) | 98 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 8.13 | (0.08 | ) | (1.41 | ) | (1.49 | ) | — | 6.64 | (18.33 | ) | 259,674 | 1.15 | 1.19 | (1.07 | ) | 17 | |||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.13 | (0.09 | ) | (0.91 | ) | (1.00 | ) | — | 8.13 | (10.95 | ) | 269,490 | 1.02 | 1.19 | (0.97 | ) | 21 | |||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.80 | (0.09 | ) | (1.35 | ) | (1.44 | ) | (0.23 | ) | 9.13 | (13.61 | ) | 266,031 | 0.97 | 1.20 | (0.89 | ) | 47 | ||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 6.86 | 0.01 | 0.37 | 0.38 | (0.00 | ) | 7.24 | 5.59 | 18,028 | 1.03 | (d) | 1.11 | (d) | 0.29 | (d) | 63 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.98 | (0.02 | ) | 0.09 | 0.07 | (0.19 | ) | 6.86 | 1.04 | 12,293 | 1.08 | 1.15 | (0.37 | ) | 10 | |||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.65 | (0.04 | ) | 0.37 | 0.33 | — | 6.98 | 4.96 | 1,971 | 1.03 | 1.12 | (0.67 | ) | 98 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 8.13 | (0.07 | ) | (1.41 | ) | (1.48 | ) | — | 6.65 | (18.20 | ) | 117,504 | 1.05 | 1.09 | (0.97 | ) | 17 | |||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.13 | (0.08 | ) | (0.92 | ) | (1.00 | ) | — | 8.13 | (10.95 | ) | 131,076 | 0.99 | 1.10 | (0.94 | ) | 21 | |||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.80 | (0.08 | ) | (1.36 | ) | (1.44 | ) | (0.23 | ) | 9.13 | (13.61 | ) | 124,497 | 0.97 | 1.12 | (0.89 | ) | 47 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $44,792, $61, $8,075, $1,801, $712,307, $201,641 and $14,068 for Class A, Class B, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
20 Invesco Balanced-Risk Commodity Strategy Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017, through April 30, 2018.
In addition to the fees and expenses which the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of the underlying funds in which the Fund invests. The amount of fees and expenses incurred indirectly by the Fund will vary because the underlying funds have varied expenses and fee levels and the Fund may own different proportions of the underlying funds at different times. Estimated underlying fund expenses are not expenses that are incurred directly by the Fund. They are expenses that are incurred directly by the underlying funds and are deducted from the value of the underlying funds the Fund invests in. The effect of the estimated underlying fund expenses that the Fund bears indirectly are included in the Fund’s total return.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, expenses shown in the table do not include the expenses of the underlying funds, which are borne indirectly by the Fund. If transaction costs and indirect expenses were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 1,055.20 | $ | 7.34 | $ | 1,017.65 | $ | 7.20 | 1.44 | % | ||||||||||||
C | 1,000.00 | 1,051.60 | 11.14 | 1,013.93 | 10.94 | 2.19 | ||||||||||||||||||
R | 1,000.00 | 1,052.90 | 8.60 | 1,016.41 | 8.45 | 1.69 | ||||||||||||||||||
Y | 1,000.00 | 1,055.90 | 6.07 | 1,018.89 | 5.96 | 1.19 | ||||||||||||||||||
R5 | 1,000.00 | 1,057.40 | 5.71 | 1,019.24 | 5.61 | 1.12 | ||||||||||||||||||
R6 | 1,000.00 | 1,055.90 | 5.25 | 1,019.69 | 5.16 | 1.03 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
21 Invesco Balanced-Risk Commodity Strategy Fund
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Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
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To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. BRCS-SAR-1 06142018 1518
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco Developing Markets Fund
| ||||
Nasdaq: | ||||
A: GTDDX ∎ C: GTDCX ∎ Y: GTDYX ∎ R5: GTDIX ∎ R6: GTDFX |
| ||||
2
| Fund Performance
| |||
4
| Letters to Shareholders
| |||
5
| Schedule of Investments
| |||
7
| Financial Statements
| |||
9
| Notes to Financial Statements
| |||
16
| Financial Highlights
| |||
17 | Fund Expenses
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | –1.61 | % | ||
Class C Shares | –1.96 | |||
Class Y Shares | –1.46 | |||
Class R5 Shares | –1.41 | |||
Class R6 Shares | –1.40 | |||
MSCI Emerging Markets Index▼ (Broad Market/Style-Specific Index) | 4.80 | |||
Lipper Emerging Market Funds Index∎ (Peer Group Index) | 4.01 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
The MSCI Emerging Markets IndexSM is an unmanaged index considered representative of stocks of developing countries. The index is computed using the net return, which withholds applicable taxes for non-resident investors.
The Lipper Emerging Market Funds Index is an unmanaged index considered representative of emerging market funds tracked by Lipper.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Developing Markets Fund
Average Annual Total Returns |
| |||
As of 4/30/18, including maximum applicable sales charges
| ||||
Class A Shares |
| |||
Inception (1/11/94) | 5.32 | % | ||
10 Years | 2.79 | |||
5 Years | 0.61 | |||
1 Year | 4.06 | |||
Class C Shares |
| |||
Inception (3/1/99) | 9.17 | % | ||
10 Years | 2.60 | |||
5 Years | 1.00 | |||
1 Year | 8.31 | |||
Class Y Shares |
| |||
10 Years | 3.62 | % | ||
5 Years | 2.01 | |||
1 Year | 10.41 | |||
Class R5 Shares |
| |||
Inception (10/25/05) | 8.73 | % | ||
10 Years | 3.80 | |||
5 Years | 2.14 | |||
1 Year | 10.52 | |||
Class R6 Shares |
| |||
10 Years | 3.62 | % | ||
5 Years | 2.18 | |||
1 Year | 10.57 |
Class Y shares incepted on October 3, 2008. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class Y,
Average Annual Total Returns |
| |||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||
Class A Shares |
| |||
Inception (1/11/94) | 5.57 | % | ||
10 Years | 3.79 | |||
5 Years | 1.95 | |||
1 Year | 12.14 | |||
Class C Shares |
| |||
Inception (3/1/99) | 9.51 | % | ||
10 Years | 3.60 | |||
5 Years | 2.34 | |||
1 Year | 16.77 | |||
Class Y Shares |
| |||
10 Years | 4.63 | % | ||
5 Years | 3.37 | |||
1 Year | 18.94 | |||
Class R5 Shares |
| |||
Inception (10/25/05) | 9.24 | % | ||
10 Years | 4.81 | |||
5 Years | 3.51 | |||
1 Year | 19.09 | |||
Class R6 Shares |
| |||
10 Years | 4.63 | % | ||
5 Years | 3.55 | |||
1 Year | 19.14 |
Class R5 and Class R6 shares was 1.43%, 2.18%, 1.18%, 1.06% and 1.02%, respectively.1 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class Y, Class R5 and Class R6 shares was 1.45%, 2.20%, 1.20%, 1.08% and 1.04%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not
waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco Developing Markets Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Developing Markets Fund
Schedule of Investments
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–88.63% |
| |||||||
Brazil–19.27% | ||||||||
Ambev S.A.–ADR | 12,247,028 | $ | 81,075,325 | |||||
Arcos Dorados Holdings, Inc.–Class A(a) | 9,746,094 | 88,689,455 | ||||||
B3 S.A.–Brasil, Bolsa, Balcão | 18,778,020 | 135,334,667 | ||||||
Banco Bradesco S.A.–ADR | 10,439,452 | 102,306,630 | ||||||
BR Malls Participacoes S.A. | 10,462,817 | 32,551,650 | ||||||
Duratex S.A. | 8,965,842 | 27,638,388 | ||||||
Fleury S.A. | 8,772,400 | 65,376,727 | ||||||
Kroton Educacional S.A. | 11,054,789 | 44,395,856 | ||||||
Raia Drogasil S.A. | 1,039,300 | 20,385,528 | ||||||
TOTVS S.A. | 1,387,900 | 12,633,119 | ||||||
Wilson Sons Ltd.–BDR | 962,600 | 10,852,776 | ||||||
621,240,121 | ||||||||
China–12.96% | ||||||||
Baidu, Inc.–ADR(b) | 98,098 | 24,612,788 | ||||||
China Mobile Ltd. | 4,998,000 | 47,530,948 | ||||||
Henan Shuanghui Investment & Development Co., Ltd.–Class A | 11,811,142 | 46,754,953 | ||||||
Industrial & Commercial Bank of China Ltd.–Class H | 58,050,000 | 51,059,823 | ||||||
Inner Mongolia Yili Industrial Group Co., Ltd.–Class A | 15,400,220 | 64,053,091 | ||||||
Kweichow Moutai Co., Ltd.–Class A | 362,161 | 38,006,586 | ||||||
Lee & Man Paper Manufacturing Ltd. | 33,323,000 | 36,823,147 | ||||||
NetEase, Inc.–ADR | 109,332 | 28,105,977 | ||||||
Sunny Optical Technology Group Co., Ltd. | 1,288,700 | 21,045,793 | ||||||
Want Want China Holdings Ltd. | 24,950,000 | 22,047,664 | ||||||
Wuliangye Yibin Co., Ltd.–Class A | 3,509,338 | 37,815,590 | ||||||
417,856,360 | ||||||||
Egypt–0.59% | ||||||||
Egyptian Financial Group-Hermes Holding Co. | 12,922,002 | 19,118,546 | ||||||
France–1.43% | ||||||||
Bollore S.A. | 9,268,497 | 45,969,579 | ||||||
Hong Kong–4.31% | ||||||||
Galaxy Entertainment Group Ltd. | 7,632,000 | 66,779,196 | ||||||
WH Group Ltd.–REGS(c) | 69,636,500 | 72,188,949 | ||||||
138,968,145 | ||||||||
Hungary–2.20% | ||||||||
Richter Gedeon Nyrt | 3,504,462 | 70,890,553 | ||||||
Indonesia–6.26% | ||||||||
PT Bank Central Asia Tbk | 46,011,600 | 72,753,138 | ||||||
PT Bank Mandiri Persero Tbk | 135,218,600 | 68,784,221 | ||||||
PT Telekomunikasi Indonesia Persero Tbk | 221,321,600 | 60,473,990 | ||||||
202,011,349 |
Shares | Value | |||||||
Israel–0.54% | ||||||||
Israel Chemicals Ltd. | 3,907,788 | $ | 17,477,350 | |||||
Malaysia–2.52% | ||||||||
Public Bank Bhd. | 13,492,400 | 81,132,524 | ||||||
Mexico–6.99% | ||||||||
Bolsa Mexicana de Valores, S.A.B. de C.V. | 20,598,400 | 39,799,839 | ||||||
Fomento Economico Mexicano, S.A.B. de C.V.–ADR | 894,371 | 86,449,901 | ||||||
GMexico Transportes, S.A.B. de | 21,580,534 | 34,343,871 | ||||||
Grupo Aeroportuario del Pacífico, S.A.B. de C.V.–Class B | 3,561,097 | 37,009,395 | ||||||
Kimberly-Clark de Mexico, S.A.B. de C.V.–Class A | 15,332,703 | 27,796,517 | ||||||
225,399,523 | ||||||||
Nigeria–1.20% | ||||||||
Zenith Bank PLC | 504,865,834 | 38,594,015 | ||||||
Peru–1.58% | ||||||||
Credicorp Ltd. | 218,960 | 50,906,010 | ||||||
Philippines–1.52% | ||||||||
SM Investments Corp. | 964,330 | 17,376,123 | ||||||
SM Prime Holdings Inc. | 47,832,400 | 31,553,431 | ||||||
48,929,554 | ||||||||
Russia–10.12% | ||||||||
Gazprom PAO–ADR | 8,031,713 | 37,099,474 | ||||||
Mobile TeleSystems PJSC–ADR | 2,786,494 | 29,258,187 | ||||||
Sberbank of Russia PJSC | 17,149,144 | 61,818,370 | ||||||
Sberbank of Russia PJSC–Preference Shares | 35,854,175 | 111,725,262 | ||||||
Yandex N.V.–Class A(b) | 2,592,126 | 86,473,323 | ||||||
326,374,616 | ||||||||
South Korea–5.78% | ||||||||
NAVER Corp. | 125,972 | 84,034,455 | ||||||
Samsung Electronics Co., Ltd. | 41,219 | 102,270,821 | ||||||
186,305,276 | ||||||||
Taiwan–2.35% | ||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 10,018,000 | 75,893,712 | ||||||
Thailand–3.02% | ||||||||
Kasikornbank PCL | 15,339,900 | 97,371,030 | ||||||
Turkey–4.89% | ||||||||
Anadolu Efes Biracilik ve Malt Sanayii A.S. | 3,181,985 | 20,915,477 | ||||||
EIS Eczacibasi Ilaç, Sinai ve Finansal Yatirimlar Sanayi ve Ticaret A.S. | 12,948,995 | 12,924,124 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Developing Markets Fund
Shares | Value | |||||||
Turkey–(continued) | ||||||||
Haci Omer Sabanci Holding A.S. | 36,920,553 | $ | 87,110,341 | |||||
Tupras-Turkiye Petrol Rafinerileri A.S. | 1,435,357 | 36,661,938 | ||||||
157,611,880 | ||||||||
United Arab Emirates–1.10% | ||||||||
Emaar Properties PJSC | 22,548,100 | 35,420,909 | ||||||
Total Common Stocks & Other Equity Interests |
| 2,857,471,052 | ||||||
Money Market Funds–11.21% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(d) | 126,505,462 | 126,505,462 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(d) | 90,342,527 | 90,351,562 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(d) | 144,577,671 | 144,577,671 | ||||||
Total Money Market Funds | 361,434,695 | |||||||
TOTAL INVESTMENTS IN SECURITIES–99.84% |
| 3,218,905,747 | ||||||
OTHER ASSETS LESS LIABILITIES–0.16% |
| 5,211,950 | ||||||
NET ASSETS–100.00% |
| $ | 3,224,117,697 |
Investment Abbreviations:
ADR | – American Depositary Receipt | |
BDR | – Brazilian Depositary Receipt | |
REGS | – Regulation S |
Notes to Schedule of Investments:
(a) | Affiliated company during the period. The Investment Company Act of 1940 defines an “affiliated person” as an issuance in which a fund holds 5% or more of the outstanding voting securities. The Fund has not owned enough of the outstanding voting securities of the issuer to have control (as defined in the Investment Company Act of 1940) of that issuer. The value of this security as of April 30, 2018 represented 2.75% of the Fund’s Net Assets. See Note 4. |
(b) | Non-income producing security. |
(c) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933” Act). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2018 was $106,532,820, which represented 3.30% of the Fund’s Net Assets. |
(d) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2018
Financials | 31.6 | % | ||
Consumer Staples | 16.4 | |||
Information Technology | 13.5 | |||
Consumer Discretionary | 6.2 | |||
Industrials | 4.5 | |||
Telecommunication Services | 4.3 | |||
Health Care | 4.2 | |||
Real Estate | 3.1 | |||
Materials | 2.5 | |||
Energy | 2.3 | |||
Money Market Funds Plus Other Assets Less Liabilities | 11.4 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Developing Markets Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $2,241,716,972) | $ | 2,768,781,597 | ||
Investments in affiliates, at value (Cost $460,184,204) | 450,124,150 | |||
Cash | 15,044,967 | |||
Foreign currencies, at value (Cost $4,854,047) | 4,660,700 | |||
Receivable for: | ||||
Fund shares sold | 4,638,118 | |||
Dividends | 3,732,946 | |||
Fund expenses absorbed | 6,736 | |||
Investment for trustee deferred compensation and retirement plans | 362,300 | |||
Other assets | 86,029 | |||
Total assets | 3,247,437,543 | |||
Liabilities: |
| |||
Payable for: | ||||
Investments purchased | 5,476,266 | |||
Fund shares reacquired | 7,477,229 | |||
Accrued foreign taxes | 8,111,748 | |||
Accrued fees to affiliates | 1,107,158 | |||
Accrued trustees’ and officers’ fees and benefits | 4,620 | |||
Accrued other operating expenses | 736,223 | |||
Trustee deferred compensation and retirement plans | 406,602 | |||
Total liabilities | 23,319,846 | |||
Net assets applicable to shares outstanding | $ | 3,224,117,697 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 2,704,718,932 | ||
Undistributed net investment income | 14,875,210 | |||
Undistributed net realized gain (loss) | (12,239,059 | ) | ||
Net unrealized appreciation | 516,762,614 | |||
$ | 3,224,117,697 |
Net Assets: |
| |||
Class A | $ | 718,947,230 | ||
Class C | $ | 79,892,379 | ||
Class Y | $ | 1,523,772,858 | ||
Class R5 | $ | 428,716,853 | ||
Class R6 | $ | 472,788,377 | ||
Shares outstanding, no par value, |
| |||
Class A | 20,075,529 | |||
Class C | 2,289,723 | |||
Class Y | 42,515,802 | |||
Class R5 | 11,988,791 | |||
Class R6 | 13,225,801 | |||
Class A: | ||||
Net asset value per share | $ | 35.81 | ||
Maximum offering price per share | ||||
(Net asset value of $35.81 ¸ 94.50%) | $ | 37.89 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 34.89 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 35.84 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 35.76 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 35.75 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Developing Markets Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of foreign withholding taxes of $3,966,342) | $ | 35,091,245 | ||
Dividends from affiliated underlying funds | 3,083,728 | |||
Total investment income | 38,174,973 | |||
Expenses: | ||||
Advisory fees | 15,057,118 | |||
Administrative services fees | 286,465 | |||
Custodian fees | 1,555,884 | |||
Distribution fees: | ||||
Class A | 986,903 | |||
Class B | 11,437 | |||
Class C | 436,358 | |||
Transfer agent fees — A, B, C and Y | 2,043,655 | |||
Transfer agent fees — R5 | 135,547 | |||
Transfer agent fees — R6 | 30,571 | |||
Trustees’ and officers’ fees and benefits | 34,092 | |||
Registration and filing fees | 92,437 | |||
Reports to shareholders | 178,353 | |||
Professional services fees | 57,589 | |||
Other | 28,500 | |||
Total expenses | 20,934,909 | |||
Less: Fees waived and expense offset arrangement(s) | (256,347 | ) | ||
Net expenses | 20,678,562 | |||
Net investment income | 17,496,411 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities (net of foreign taxes of $1,791,574) | 93,476,686 | |||
Foreign currencies | (1,289,215 | ) | ||
92,187,471 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities (net of foreign taxes of $2,872,214) | (151,410,147 | ) | ||
Foreign currencies | (80,513 | ) | ||
(151,490,660 | ) | |||
Net realized and unrealized gain (loss) | (59,303,189 | ) | ||
Net increase (decrease) in net assets resulting from operations | $ | (41,806,778 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Developing Markets Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income | $ | 17,496,411 | $ | 30,782,524 | ||||
Net realized gain | 92,187,471 | 119,640,254 | ||||||
Change in net unrealized appreciation (depreciation) | (151,490,660 | ) | 435,366,557 | |||||
Net increase (decrease) in net assets resulting from operations | (41,806,778 | ) | 585,789,335 | |||||
Distributions to shareholders from net investment income: | ||||||||
Class A | (5,600,666 | ) | (6,465,840 | ) | ||||
Class B | (237 | ) | (9,114 | ) | ||||
Class C | (4,392 | ) | (88,315 | ) | ||||
Class Y | (16,530,978 | ) | (11,463,530 | ) | ||||
Class R5 | (5,045,947 | ) | (3,838,802 | ) | ||||
Class R6 | (4,921,857 | ) | (2,041,422 | ) | ||||
Total distributions from net investment income | (32,104,077 | ) | (23,907,023 | ) | ||||
Share transactions–net: | ||||||||
Class A | (143,637,116 | ) | (91,568,138 | ) | ||||
Class B | (5,577,356 | ) | (4,910,609 | ) | ||||
Class C | (6,953,376 | ) | (9,310,384 | ) | ||||
Class Y | (20,018,243 | ) | 244,683,793 | |||||
Class R5 | (31,296,443 | ) | 64,225,172 | |||||
Class R6 | 60,191,392 | 217,227,291 | ||||||
Net increase (decrease) in net assets resulting from share transactions | (147,291,142 | ) | 420,347,125 | |||||
Net increase (decrease) in net assets | (221,201,997 | ) | 982,229,437 | |||||
Net assets: | ||||||||
Beginning of period | 3,445,319,694 | 2,463,090,257 | ||||||
End of period (includes undistributed net investment income of $14,875,210 and $29,482,876, respectively) | $ | 3,224,117,697 | $ | 3,445,319,694 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Developing Markets Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
As of the open of business on June 8, 2017, the Fund has closed public sales of its shares to new investors.
The Fund currently consists of five different classes of shares: Class A, Class C, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class Y, Class R5 and Class R6 shares are sold at net asset value. Effective November 30, 2010, new or additional investments in Class B shares are no longer permitted. Existing shareholders of Class B shares were permitted to continue to reinvest dividends and capital gains distributions in Class B shares until their conversion to Class A shares. Also, shareholders in Class B shares were able to exchange those shares for Class B shares of other Invesco Funds offering such shares until they converted to Class A shares. Generally, Class B shares automatically converted to Class A shares on or about the month-end, which was at least eight years after the date of purchase. Redemptions of Class B shares prior to the conversion date were subject to a CDSC. Effective January 26, 2018, all of the Fund’s outstanding Class B shares were converted to Class A shares, in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
9 Invesco Developing Markets Fund
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
10 Invesco Developing Markets Fund
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
J. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the
11 Invesco Developing Markets Fund
contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||||||
First $250 million | 0 | .935% | ||||||
Next $250 million | 0 | .91% | ||||||
Next $500 million | 0 | .885% | ||||||
Next $1.5 billion | 0 | .86% | ||||||
Next $2.5 billion | 0 | .835% | ||||||
Next $2.5 billion | 0 | .81% | ||||||
Next $2.5 billion | 0 | .785% | ||||||
Over $10 billion | 0 | .76% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.87%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waivers and/or reimbursements (excluding certain items discussed below) of Class A, Class C, Class Y, Class R5 and Class R6 shares to 2.25%, 3.00%, 2.00%, 2.00% and 2.00%, respectively, of the Fund’s average daily net assets (the “expense limits”). Prior to their conversion to Class A shares, the expense limit for Class B was 3.00% of average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $246,316.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A and Class C shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares and 1.00% of the average daily net assets of Class C shares. Prior to their conversion to Class A shares, the Fund paid an annual rate of 1.00% of the average daily net assets of Class B shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $21,001 in front-end sales commissions from the sale of Class A shares and $2,999 and $1,773 from Class A and Class C shares, respectively, for CDSC imposed on redemptions by shareholders.
12 Invesco Developing Markets Fund
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were transfers from Level 1 to Level 2 of $714,360,248, due to foreign fair value adjustments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Brazil | $ | 621,240,121 | $ | — | $ | — | $ | 621,240,121 | ||||||||
China | 52,718,765 | 365,137,595 | — | 417,856,360 | ||||||||||||
Egypt | — | 19,118,546 | — | 19,118,546 | ||||||||||||
France | — | 45,969,579 | — | 45,969,579 | ||||||||||||
Hong Kong | — | 138,968,145 | — | 138,968,145 | ||||||||||||
Hungary | 70,890,553 | — | — | 70,890,553 | ||||||||||||
Indonesia | — | 202,011,349 | — | 202,011,349 | ||||||||||||
Israel | — | 17,477,350 | — | 17,477,350 | ||||||||||||
Malaysia | — | 81,132,524 | — | 81,132,524 | ||||||||||||
Mexico | 225,399,523 | — | — | 225,399,523 | ||||||||||||
Nigeria | — | 38,594,015 | — | 38,594,015 | ||||||||||||
Peru | 50,906,010 | — | — | 50,906,010 | ||||||||||||
Philippines | — | 48,929,554 | — | 48,929,554 | ||||||||||||
Russia | 115,731,510 | 210,643,106 | — | 326,374,616 | ||||||||||||
South Korea | — | 186,305,276 | — | 186,305,276 | ||||||||||||
Taiwan | — | 75,893,712 | — | 75,893,712 | ||||||||||||
Thailand | — | 97,371,030 | — | 97,371,030 | ||||||||||||
Turkey | — | 157,611,880 | — | 157,611,880 | ||||||||||||
United Arab Emirates | — | 35,420,909 | — | 35,420,909 | ||||||||||||
Money Market Funds | 361,434,695 | — | — | 361,434,695 | ||||||||||||
Total Investments | $ | 1,498,321,177 | $ | 1,720,584,570 | $ | — | $ | 3,218,905,747 |
NOTE 4—Investments in Other Affiliates
The 1940 Act defines an “affiliated person” as an issuance in which a fund holds 5% or more of the outstanding voting securities. The Fund has not owned enough of the outstanding voting securities of the issuer to have control (as defined in the 1940 Act) of that issuer. The following is a summary of the investments in other affiliates (excluding affiliated money market funds) for the six months ended April 30, 2018.
Value 10/31/17 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation (Depreciation) | Realized Gain (Loss) | Value 04/30/18 | Dividend Income | ||||||||||||||||||||||
Arcos Dorados Holdings, Inc. — Class A | $ | 90,686,940 | $ | 6,939,938 | $ | — | $ | (8,937,423 | ) | $ | — | $ | 88,689,455 | $ | — |
13 Invesco Developing Markets Fund
NOTE 5—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $10,031.
NOTE 6—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 7—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 8—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund had a capital loss carryforward as of October 31, 2017, as follows:
Capital Loss Carryforward* | ||||||||||||
Expiration | Short-Term | Long-Term | Total | |||||||||
Not subject to expiration | $ | 7,328,822 | $ | 96,124,159 | $ | 103,452,981 |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
NOTE 9—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $279,056,783 and $306,001,224, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 714,605,596 | ||
Aggregate unrealized (depreciation) of investments | (200,765,893 | ) | ||
Net unrealized appreciation of investments | $ | 513,839,703 |
Cost of investments for tax purposes is $2,705,066,044.
14 Invesco Developing Markets Fund
NOTE 10—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 1,167,724 | $ | 44,172,206 | 5,580,960 | $ | 179,300,415 | ||||||||||
Class B(b) | 966 | 35,601 | 3,460 | 107,898 | ||||||||||||
Class C | 47,172 | 1,741,177 | 421,647 | 13,192,183 | ||||||||||||
Class Y | 7,796,495 | 292,003,514 | 23,586,261 | 742,795,060 | ||||||||||||
Class R5 | 1,342,466 | 51,300,761 | 5,214,837 | 169,419,983 | ||||||||||||
Class R6 | 2,615,105 | 99,446,964 | 7,776,259 | 262,410,342 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 140,820 | 5,158,251 | 204,009 | 5,975,421 | ||||||||||||
Class B(b) | 5 | 189 | 270 | 7,751 | ||||||||||||
Class C | 112 | 4,025 | 2,815 | 80,594 | ||||||||||||
Class Y | 272,609 | 9,985,678 | 224,203 | 6,566,919 | ||||||||||||
Class R5 | 114,412 | 4,179,476 | 124,103 | 3,625,047 | ||||||||||||
Class R6 | 104,419 | 3,812,321 | 69,519 | 2,029,942 | ||||||||||||
Conversion of Class B shares to Class A shares:(c) | ||||||||||||||||
Class A | 119,310 | 4,815,368 | 111,089 | 3,668,845 | ||||||||||||
Class B | (122,363 | ) | (4,815,368 | ) | (113,940 | ) | (3,668,845 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (5,328,459 | ) | (197,782,941 | ) | (8,807,768 | ) | (280,512,819 | ) | ||||||||
Class B(b) | (21,675 | ) | (797,778 | ) | (43,418 | ) | (1,357,413 | ) | ||||||||
Class C | (236,565 | ) | (8,698,578 | ) | (715,863 | ) | (22,583,161 | ) | ||||||||
Class Y | (8,438,282 | ) | (322,007,435 | ) | (15,253,958 | ) | (504,678,186 | ) | ||||||||
Class R5 | (2,295,029 | ) | (86,776,680 | ) | (3,301,481 | ) | (108,819,858 | ) | ||||||||
Class R6 | (1,145,266 | ) | (43,067,893 | ) | (1,435,306 | ) | (47,212,993 | ) | ||||||||
Net increase (decrease) in share activity | (3,866,024 | ) | $ | (147,291,142 | ) | 13,647,698 | $ | 420,347,125 |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and own 50% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as, securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
(b) | Class B shares activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(c) | Effective as of the close of business January 26, 2018, all outstanding Class B shares were converted to Class A shares. |
15 Invesco Developing Markets Fund
NOTE 11—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 36.66 | $ | 0.15 | $ | (0.73 | ) | $ | (0.58 | ) | $ | (0.27 | ) | $ | — | $ | (0.27 | ) | $ | 35.81 | (1.61 | )% | $ | 718,947 | 1.39 | %(d) | 1.40 | %(d) | 0.80 | %(d) | 9 | % | ||||||||||||||||||||||||
Year ended 10/31/17 | 30.67 | 0.28 | 5.96 | 6.24 | (0.25 | ) | — | (0.25 | ) | 36.66 | 20.55 | 878,910 | 1.41 | 1.43 | 0.86 | 16 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 25.84 | 0.27 | 4.80 | 5.07 | (0.24 | ) | — | (0.24 | ) | 30.67 | 19.88 | 824,702 | 1.40 | 1.41 | 1.01 | 3 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 33.77 | 0.28 | (7.32 | ) | (7.04 | ) | (0.33 | ) | (0.56 | ) | (0.89 | ) | 25.84 | (21.20 | ) | 795,042 | 1.43 | 1.44 | 0.96 | 9 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 34.42 | 0.38 | (0.65 | ) | (0.27 | ) | (0.28 | ) | (0.10 | ) | (0.38 | ) | 33.77 | (0.73 | ) | 1,251,018 | 1.39 | 1.41 | 1.13 | 13 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 32.70 | 0.30 | 1.66 | 1.96 | (0.24 | ) | — | (0.24 | ) | 34.42 | 6.03 | 1,494,412 | 1.38 | 1.40 | 0.89 | 14 | ||||||||||||||||||||||||||||||||||||||||
Class B | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18(e) | 35.64 | 0.00 | 3.81 | 3.81 | (0.00 | ) | — | (0.00 | ) | 39.45 | 10.69 | — | 2.14 | (d) | 2.15 | (d) | 0.05 | (d) | 9 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 29.82 | 0.03 | 5.82 | 5.85 | (0.03 | ) | — | (0.03 | ) | 35.64 | 19.65 | 5,098 | 2.16 | 2.18 | 0.11 | 16 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 25.06 | 0.07 | 4.69 | 4.76 | — | — | — | 29.82 | 18.99 | 8,848 | 2.15 | 2.16 | 0.26 | 3 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 32.72 | 0.06 | (7.11 | ) | (7.05 | ) | (0.05 | ) | (0.56 | ) | (0.61 | ) | 25.06 | (21.80 | ) | 12,710 | 2.18 | 2.19 | 0.21 | 9 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 33.31 | 0.12 | (0.61 | ) | (0.49 | ) | (0.00 | ) | (0.10 | ) | (0.10 | ) | 32.72 | (1.46 | ) | 28,314 | 2.14 | 2.16 | 0.38 | 13 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 31.66 | 0.04 | 1.61 | 1.65 | — | — | — | 33.31 | 5.21 | 44,403 | 2.13 | 2.15 | 0.14 | 14 | ||||||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 35.59 | 0.01 | (0.71 | ) | (0.70 | ) | (0.00 | ) | — | (0.00 | ) | 34.89 | (1.96 | ) | 79,892 | 2.14 | (d) | 2.15 | (d) | 0.05 | (d) | 9 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 29.78 | 0.03 | 5.81 | 5.84 | (0.03 | ) | — | (0.03 | ) | 35.59 | 19.65 | 88,231 | 2.16 | 2.18 | 0.11 | 16 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 25.03 | 0.07 | 4.68 | 4.75 | — | — | — | 29.78 | 18.98 | 82,513 | 2.15 | 2.16 | 0.26 | 3 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 32.68 | 0.06 | (7.10 | ) | (7.04 | ) | (0.05 | ) | (0.56 | ) | (0.61 | ) | 25.03 | (21.80 | ) | 82,395 | 2.18 | 2.19 | 0.21 | 9 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 33.27 | 0.12 | (0.61 | ) | (0.49 | ) | (0.00 | ) | (0.10 | ) | (0.10 | ) | 32.68 | (1.47 | ) | 137,867 | 2.14 | 2.16 | 0.38 | 13 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 31.62 | 0.04 | 1.61 | 1.65 | — | — | — | 33.27 | 5.22 | 168,313 | 2.13 | 2.15 | 0.14 | 14 | ||||||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 36.74 | 0.20 | (0.74 | ) | (0.54 | ) | (0.36 | ) | — | (0.36 | ) | 35.84 | (1.49 | ) | 1,523,773 | 1.14 | (d) | 1.15 | (d) | 1.05 | (d) | 9 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 30.74 | 0.37 | 5.95 | 6.32 | (0.32 | ) | — | (0.32 | ) | 36.74 | 20.84 | 1,575,401 | 1.16 | 1.18 | 1.11 | 16 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 25.92 | 0.35 | 4.79 | 5.14 | (0.32 | ) | — | (0.32 | ) | 30.74 | 20.18 | 1,055,132 | 1.15 | 1.16 | 1.26 | 3 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 33.90 | 0.36 | (7.35 | ) | (6.99 | ) | (0.43 | ) | (0.56 | ) | (0.99 | ) | 25.92 | (21.00 | ) | 1,016,382 | 1.18 | 1.19 | 1.21 | 9 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 34.55 | 0.46 | (0.64 | ) | (0.18 | ) | (0.37 | ) | (0.10 | ) | (0.47 | ) | 33.90 | (0.47 | ) | 1,463,586 | 1.14 | 1.16 | 1.38 | 13 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 32.83 | 0.38 | 1.66 | 2.04 | (0.32 | ) | — | (0.32 | ) | 34.55 | 6.27 | 1,175,003 | 1.13 | 1.15 | 1.14 | 14 | ||||||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 36.68 | 0.22 | (0.74 | ) | (0.52 | ) | (0.40 | ) | — | (0.40 | ) | 35.76 | (1.43 | ) | 428,717 | 1.04 | (d) | 1.05 | (d) | 1.15 | (d) | 9 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 30.69 | 0.41 | 5.94 | 6.35 | (0.36 | ) | — | (0.36 | ) | 36.68 | 20.97 | 470,436 | 1.04 | 1.06 | 1.23 | 16 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 25.90 | 0.38 | 4.79 | 5.17 | (0.38 | ) | — | (0.38 | ) | 30.69 | 20.33 | 331,079 | 1.03 | 1.04 | 1.38 | 3 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 33.87 | 0.40 | (7.33 | ) | (6.93 | ) | (0.48 | ) | (0.56 | ) | (1.04 | ) | 25.90 | (20.87 | ) | 352,779 | 1.03 | 1.04 | 1.36 | 9 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 34.52 | 0.51 | (0.66 | ) | (0.15 | ) | (0.40 | ) | (0.10 | ) | (0.50 | ) | 33.87 | (0.35 | ) | 686,180 | 0.99 | 1.01 | 1.53 | 13 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 32.80 | 0.42 | 1.67 | 2.09 | (0.37 | ) | — | (0.37 | ) | 34.52 | 6.43 | 666,769 | 1.01 | 1.03 | 1.26 | 14 | ||||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 36.67 | 0.22 | (0.72 | ) | (0.50 | ) | (0.42 | ) | — | (0.42 | ) | 35.75 | (1.40 | ) | 472,788 | 1.00 | (d) | 1.01 | (d) | 1.19 | (d) | 9 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 30.68 | 0.42 | 5.94 | 6.36 | (0.37 | ) | — | (0.37 | ) | 36.67 | 21.04 | 427,243 | 1.00 | 1.02 | 1.27 | 16 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 25.90 | 0.39 | 4.78 | 5.17 | (0.39 | ) | — | (0.39 | ) | 30.68 | 20.35 | 160,816 | 0.98 | 0.99 | 1.43 | 3 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 33.87 | 0.41 | (7.33 | ) | (6.92 | ) | (0.49 | ) | (0.56 | ) | (1.05 | ) | 25.90 | (20.84 | ) | 180,773 | 1.00 | 1.01 | 1.39 | 9 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 34.52 | 0.52 | (0.65 | ) | (0.13 | ) | (0.42 | ) | (0.10 | ) | (0.52 | ) | 33.87 | (0.31 | ) | 179,467 | 0.97 | 0.99 | 1.55 | 13 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 32.81 | 0.44 | 1.66 | 2.10 | (0.39 | ) | — | (0.39 | ) | 34.52 | 6.46 | 154,375 | 0.97 | 0.99 | 1.30 | 14 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $796,054, $4,803, $87,995, $1,679,339, $476,894 and $466,547 for Class A, Class B, Class C, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
16 Invesco Developing Markets Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 983.90 | $ | 6.84 | $ | 1,017.90 | $ | 6.95 | 1.39 | % | ||||||||||||
C | 1,000.00 | 980.40 | 10.51 | 1,014.18 | 10.69 | 2.14 | ||||||||||||||||||
Y | 1,000.00 | 985.40 | 5.61 | 1,019.14 | 5.71 | 1.14 | ||||||||||||||||||
R5 | 1,000.00 | 985.90 | 5.12 | 1,019.64 | 5.21 | 1.04 | ||||||||||||||||||
R6 | 1,000.00 | 986.00 | 4.92 | 1,019.84 | 5.01 | 1.00 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
17 Invesco Developing Markets Fund
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Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov.
The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. DVM-SAR-1 06252018 1007
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco Emerging Markets Equity Fund
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Nasdaq: | ||||
A: IEMAX ∎ C: IEMCX ∎ R: IEMRX ∎ Y: IEMYX ∎ R5: IEMIX ∎ R6: EMEFX |
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2
| Fund Performance
| |||
4
| Letters to Shareholders
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5
| Schedule of Investments
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7
| Financial Statements
| |||
9
| Notes to Financial Statements
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16
| Financial Highlights
| |||
17 | Fund Expenses
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For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 4.72 | % | ||
Class C Shares | 4.43 | |||
Class R Shares | 4.56 | |||
Class Y Shares | 4.86 | |||
Class R5 Shares | 4.86 | |||
Class R6 Shares | 4.87 | |||
MSCI EAFE Index▼ (Broad Market Index) | 3.41 | |||
MSCI Emerging Markets Index▼ (Style-Specific Index) | 4.80 | |||
Lipper Emerging Market Funds Index∎ (Peer Group Index) | 4.01 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
|
The MSCI EAFE® Index is an unmanaged index considered representative of stocks of Europe, Australasia and the Far East. The index is computed using the net return, which withholds applicable taxes for non-resident investors.
The MSCI Emerging Markets IndexSM is an unmanaged index considered representative of stocks of developing countries. The index is computed using the net return, which withholds applicable taxes for non-resident investors.
The Lipper Emerging Market Funds Index is an unmanaged index considered representative of emerging markets funds tracked by Lipper.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Emerging Markets Equity Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
| ||||||
Class A Shares |
| |||||
Inception (5/31/11) | -0.66 | % | ||||
5 Years | 4.12 | |||||
1 Year | 17.91 | |||||
Class C Shares |
| |||||
Inception (5/31/11) | -0.59 | % | ||||
5 Years | 4.52 | |||||
1 Year | 22.75 | |||||
Class R Shares |
| |||||
Inception (5/31/11) | -0.12 | % | ||||
5 Years | 5.02 | |||||
1 Year | 24.42 | |||||
Class Y Shares |
| |||||
Inception (5/31/11) | 0.39 | % | ||||
5 Years | 5.57 | |||||
1 Year | 24.94 | |||||
Class R5 Shares |
| |||||
Inception (5/31/11) | 0.39 | % | ||||
5 Years | 5.55 | |||||
1 Year | 24.95 | |||||
Class R6 Shares |
| |||||
Inception | 0.33 | % | ||||
5 Years | 5.53 | |||||
1 Year | 24.82 |
Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.34%, 2.09%, 1.59%, 1.09%, 1.09% and 1.09%, respectively.1 The
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (5/31/11) | -0.25 | % | ||||
5 Years | 4.71 | |||||
1 Year | 25.09 | |||||
Class C Shares |
| |||||
Inception (5/31/11) | -0.19 | % | ||||
5 Years | 5.08 | |||||
1 Year | 30.26 | |||||
Class R Shares |
| |||||
Inception (5/31/11) | 0.30 | % | ||||
5 Years | 5.59 | |||||
1 Year | 31.96 | |||||
Class Y Shares |
| |||||
Inception (5/31/11) | 0.81 | % | ||||
5 Years | 6.15 | |||||
1 Year | 32.77 | |||||
Class R5 Shares |
| |||||
Inception (5/31/11) | 0.81 | % | ||||
5 Years | 6.15 | |||||
1 Year | 32.60 | |||||
Class R6 Shares |
| |||||
Inception | 0.75 | % | ||||
5 Years | 6.13 | |||||
1 Year | 32.47 |
total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 2.46%, 3.21%, 2.71%, 2.21%, 1.92% and 1.92%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not
waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least February 28, 2019. See current prospectus for more information. |
3 Invesco Emerging Markets Equity Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Emerging Markets Equity Fund
Schedule of Investments
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–99.15% |
| |||||||
Argentina–4.45% | ||||||||
Banco Macro S.A.–ADR | 11,644 | $ | 1,128,536 | |||||
Grupo Financiero Galicia S.A.–ADR | 18,520 | 1,183,798 | ||||||
MercadoLibre Inc. | 2,589 | 879,250 | ||||||
3,191,584 | ||||||||
Brazil–5.46% | ||||||||
Grendene S.A. | 126,300 | 983,074 | ||||||
Itau Unibanco Holding S.A.–Preference Shares | 71,700 | 1,041,067 | ||||||
Multiplus S.A. | 91,300 | 746,609 | ||||||
Raia Drogasil S.A. | 58,500 | 1,147,458 | ||||||
3,918,208 | ||||||||
China–32.49% | ||||||||
Agricultural Bank of China Ltd.–Class H | 2,151,000 | 1,208,266 | ||||||
Alibaba Group Holding Ltd.–ADR(a) | 20,524 | 3,664,355 | ||||||
Baidu, Inc.–ADR(a) | 8,031 | 2,014,978 | ||||||
Bank of China Ltd.–Class H | 2,683,000 | 1,454,429 | ||||||
Hangzhou Robam Appliances Co. Ltd.–Class A | 223,130 | 1,172,201 | ||||||
Nexteer Automotive Group Ltd. | 742,000 | 1,142,649 | ||||||
PICC Property and Casualty Co. Ltd.–Class H | 414,000 | 741,726 | ||||||
Ping An Insurance (Group) Co. of China Ltd.–Class H | 199,000 | 1,943,510 | ||||||
Shenzhou International Group Holdings Ltd. | 121,000 | 1,318,058 | ||||||
TAL Education Group–ADR | 35,280 | 1,284,898 | ||||||
Tencent Holdings Ltd. | 90,700 | 4,453,079 | ||||||
Wuliangye Yibin Co., Ltd.–Class A | 97,586 | 1,051,558 | ||||||
Xiabuxiabu Catering Management China Holdings Co. Ltd.–REGS(b) | 573,000 | 983,193 | ||||||
Zhengzhou Yutong Bus Co., Ltd.–Class A | 274,400 | 887,370 | ||||||
23,320,270 | ||||||||
Hong Kong–3.72% | ||||||||
AIA Group Ltd. | 166,400 | 1,485,657 | ||||||
Techtronic Industries Co. Ltd. | 202,500 | 1,184,299 | ||||||
2,669,956 | ||||||||
India–11.05% | ||||||||
Asian Paints Ltd. | 51,906 | 931,842 | ||||||
Britannia Industries Ltd. | 9,965 | 821,309 | ||||||
Eicher Motors Ltd. | 2,501 | 1,164,732 | ||||||
HDFC Bank Ltd. | 60,881 | 1,772,731 | ||||||
Housing Development Finance Corp. Ltd. | 53,635 | 1,508,721 | ||||||
Maruti Suzuki India Ltd. | 7,608 | 1,000,964 | ||||||
Tata Consultancy Services Ltd. | 13,828 | 730,301 | ||||||
7,930,600 | ||||||||
Indonesia–2.33% | ||||||||
PT Bank Rakyat Indonesia (Persero) Tbk | 4,921,500 | 1,134,353 | ||||||
PT Link Net Tbk | 1,388,200 | 538,797 | ||||||
1,673,150 |
Shares | Value | |||||||
Malaysia–1.33% | ||||||||
My E.G. Services Bhd | 1,459,800 | $ | 952,991 | |||||
Mexico–3.20% | ||||||||
Fomento Economico Mexicano, S.A.B. | 10,905 | 1,054,077 | ||||||
Regional S.A.B. de C.V. | 195,300 | 1,243,642 | ||||||
2,297,719 | ||||||||
Peru–1.81% | ||||||||
Credicorp Ltd. | 5,575 | 1,296,132 | ||||||
Poland–2.02% | ||||||||
Benefit Systems S.A.(a) | 2,363 | 713,693 | ||||||
CCC S.A. | 10,028 | 735,867 | ||||||
1,449,560 | ||||||||
Russia–3.53% | ||||||||
Sberbank of Russia PJSC–ADR | 102,211 | 1,511,004 | ||||||
Yandex N.V.–Class A(a) | 30,737 | 1,025,386 | ||||||
2,536,390 | ||||||||
South Africa–4.13% | ||||||||
Clicks Group Ltd. | 67,851 | 1,151,027 | ||||||
Naspers Ltd.–Class N | 7,443 | 1,815,954 | ||||||
2,966,981 | ||||||||
South Korea–10.75% | ||||||||
Koh Young Technology Inc. | 14,685 | 1,393,029 | ||||||
Kakao M Corp. | 12,773 | 1,066,031 | ||||||
Ottogi Corp. | 1,463 | 1,083,677 | ||||||
Samsung Electronics Co., Ltd. | 1,682 | 4,173,306 | ||||||
7,716,043 | ||||||||
Taiwan–7.78% | ||||||||
King Slide Works Co., Ltd. | 79,000 | 1,116,323 | ||||||
President Chain Store Corp. | 109,000 | 1,071,155 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 448,000 | 3,393,929 | ||||||
5,581,407 | ||||||||
Thailand–3.75% | ||||||||
Beauty Community PCL–NVDR | 2,300,500 | 1,692,015 | ||||||
Kasikornbank PCL | 157,000 | 996,568 | ||||||
2,688,583 | ||||||||
United States–1.35% | ||||||||
EPAM Systems, Inc.(a) | 8,499 | 971,861 | ||||||
Total Common Stocks & Other Equity Interests |
| 71,161,435 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Emerging Markets Equity Fund
Shares | Value | |||||||
Money Market Funds–1.54% | ||||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(c) | 388,050 | $ | 388,050 | |||||
Invesco Liquid Assets Portfolio–Institutional | 277,131 | 277,159 | ||||||
Invesco Treasury Portfolio–Institutional | 443,486 | 443,486 | ||||||
Total Money Market Funds | 1,108,695 | |||||||
TOTAL INVESTMENTS IN SECURITIES–100.69% |
| 72,270,130 | ||||||
OTHER ASSETS LESS LIABILITIES–(0.69)% | (498,160 | ) | ||||||
NET ASSETS–100.00% | $ | 71,771,970 |
Investment Abbreviations:
ADR | – American Depositary Receipt | |
NVDR | – Non-Voting Depositary Receipt | |
REGS | – Regulation S |
Notes to Schedule of Investments:
(a) | Non-income producing security. |
(b) | Security purchased or received in transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The value of this security at April 30, 2018 represented 1.37% of the Fund’s Net Assets. |
(c) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2018
Information Technology | 33.0 | % | ||
Financials | 27.4 | |||
Consumer Discretionary | 21.1 | |||
Consumer Staples | 10.3 | |||
Industrials | 5.4 | |||
Materials | 1.3 | |||
Telecommunication Services | 0.7 | |||
Money Market Funds Plus Other Assets Less Liabilities | 0.8 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Emerging Markets Equity Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $60,848,275) | $ | 71,161,435 | ||
Investments in affiliated money market funds, at value (Cost $1,108,693) | 1,108,695 | |||
Cash | 31,964 | |||
Foreign currencies, at value (Cost $51,890) | 50,987 | |||
Receivable for: | ||||
Investments sold | 850,391 | |||
Fund shares sold | 162,356 | |||
Dividends | 84,386 | |||
Fund expenses absorbed | 21,186 | |||
Investment for trustee deferred compensation and retirement plans | 22,411 | |||
Other assets | 63,279 | |||
Total assets | 73,557,090 | |||
Liabilities: |
| |||
Payable for: | ||||
Investments purchased | 1,335,734 | |||
Fund shares reacquired | 149,932 | |||
Accrued foreign taxes | 179,278 | |||
Accrued fees to affiliates | 40,221 | |||
Accrued trustees’ and officers’ fees and benefits | 1,531 | |||
Accrued other operating expenses | 55,200 | |||
Trustee deferred compensation and retirement plans | 23,224 | |||
Total liabilities | 1,785,120 | |||
Net assets applicable to shares outstanding | $ | 71,771,970 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 65,813,982 | ||
Undistributed net investment income (loss) | (158,022 | ) | ||
Undistributed net realized gain (loss) | (4,198,758 | ) | ||
Net unrealized appreciation | 10,314,768 | |||
$ | 71,771,970 |
Net Assets: |
| |||
Class A | $ | 40,464,608 | ||
Class C | $ | 10,679,437 | ||
Class R | $ | 2,687,173 | ||
Class Y | $ | 15,655,165 | ||
Class R5 | $ | 2,055,992 | ||
Class R6 | $ | 229,595 | ||
Shares outstanding, no par value, |
| |||
Class A | 4,157,922 | |||
Class C | 1,132,434 | |||
Class R | 278,920 | |||
Class Y | 1,603,487 | |||
Class R5 | 210,574 | |||
Class R6 | 23,535 | |||
Class A: | ||||
Net asset value per share | $ | 9.73 | ||
Maximum offering price per share | ||||
(Net asset value of $9.73 ¸ 94.50%) | $ | 10.30 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 9.43 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 9.63 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 9.76 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 9.76 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 9.76 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Emerging Markets Equity Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of foreign withholding taxes of $29,112) | $ | 270,854 | ||
Dividends from affiliated money market funds | 9,100 | |||
Total investment income | 279,954 | |||
Expenses: | ||||
Advisory fees | 275,917 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 44,837 | |||
Distribution fees: | ||||
Class A | 41,784 | |||
Class C | 44,938 | |||
Class R | 6,412 | |||
Transfer agent fees — A, C, R and Y | 63,854 | |||
Transfer agent fees — R5 | 42 | |||
Transfer agent fees — R6 | 2 | |||
Trustees’ and officers’ fees and benefits | 11,379 | |||
Registration and filing fees | 47,027 | |||
Reports to shareholders | 9,916 | |||
Professional services fees | 34,137 | |||
Other | 6,050 | |||
Total expenses | 611,090 | |||
Less: Fees waived, expenses reimbursed and expense offset arrangement(s) | (199,967 | ) | ||
Net expenses | 411,123 | |||
Net investment income (loss) | (131,169 | ) | ||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities (net of foreign taxes of $27,640) | (41,611 | ) | ||
Foreign currencies | (59,199 | ) | ||
(100,810 | ) | |||
Change in net unrealized appreciation of: | ||||
Investment securities (net of foreign taxes of $74,762) | 1,373,522 | |||
Foreign currencies | 2,260 | |||
1,375,782 | ||||
Net realized and unrealized gain | 1,274,972 | |||
Net increase in net assets resulting from operations | $ | 1,143,803 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Emerging Markets Equity Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: | ||||||||
Net investment income (loss) | $ | (131,169 | ) | $ | 84,389 | |||
Net realized gain (loss) | (100,810 | ) | 1,767,893 | |||||
Change in net unrealized appreciation | 1,375,782 | 6,895,427 | ||||||
Net increase in net assets resulting from operations | 1,143,803 | 8,747,709 | ||||||
Distributions to shareholders from net investment income: | ||||||||
Class A | (26,510 | ) | (11,076 | ) | ||||
Class Y | (20,895 | ) | (17,401 | ) | ||||
Class R5 | (4,874 | ) | (4,962 | ) | ||||
Class R6 | (30 | ) | (22,501 | ) | ||||
Total distributions from net investment income | (52,309 | ) | (55,940 | ) | ||||
Share transactions–net: | ||||||||
Class A | 15,513,801 | 8,005,020 | ||||||
Class C | 3,715,993 | 2,423,355 | ||||||
Class R | 419,780 | 449,330 | ||||||
Class Y | 8,440,201 | 758,252 | ||||||
Class R5 | 4,821 | 4,962 | ||||||
Class R6 | 223,071 | (7,195,831 | ) | |||||
Net increase in net assets resulting from share transactions | 28,317,667 | 4,445,088 | ||||||
Net increase in net assets | 29,409,161 | 13,136,857 | ||||||
Net assets: | ||||||||
Beginning of period | 42,362,809 | 29,225,952 | ||||||
End of period (includes undistributed net investment income (loss) of $(158,022) and $25,456, respectively) | $ | 71,771,970 | $ | 42,362,809 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Emerging Markets Equity Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net
9 Invesco Emerging Markets Equity Fund
asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
10 Invesco Emerging Markets Equity Fund
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
J. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
11 Invesco Emerging Markets Equity Fund
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||||||
First $250 million | 0 | .935% | ||||||
Next $250 million | 0 | .91% | ||||||
Next $500 million | 0 | .885% | ||||||
Next $1.5 billion | 0 | .86% | ||||||
Next $2.5 billion | 0 | .835% | ||||||
Next $2.5 billion | 0 | .81% | ||||||
Next $2.5 billion | 0 | .785% | ||||||
Over $10 billion | 0 | .76% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.935%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.33%, 2.08%, 1.58%, 1.08%, 1.08% and 1.08%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $136,069 and reimbursed class level expenses of $36,763, $9,884, $2,821, $13,023, $42 and $2 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $17,217 in front-end sales commissions from the sale of Class A shares and $5 and $242 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
12 Invesco Emerging Markets Equity Fund
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were transfers from Level 1 to Level 2 of $24,819,798, due to foreign fair value adjustments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Argentina | $ | 3,191,584 | $ | — | $ | — | $ | 3,191,584 | ||||||||
Brazil | 3,918,208 | — | — | 3,918,208 | ||||||||||||
China | 7,851,601 | 15,468,669 | — | 23,320,270 | ||||||||||||
Hong Kong | — | 2,669,956 | — | 2,669,956 | ||||||||||||
India | — | 7,930,600 | — | 7,930,600 | ||||||||||||
Indonesia | 538,797 | 1,134,353 | — | 1,673,150 | ||||||||||||
Malaysia | — | 952,991 | — | 952,991 | ||||||||||||
Mexico | 2,297,719 | — | — | 2,297,719 | ||||||||||||
Peru | 1,296,132 | — | — | 1,296,132 | ||||||||||||
Poland | — | 1,449,560 | — | 1,449,560 | ||||||||||||
Russia | 1,025,386 | 1,511,004 | — | 2,536,390 | ||||||||||||
South Africa | — | 2,966,981 | — | 2,966,981 | ||||||||||||
South Korea | — | 7,716,043 | — | 7,716,043 | ||||||||||||
Taiwan | — | 5,581,407 | — | 5,581,407 | ||||||||||||
Thailand | — | 2,688,583 | — | 2,688,583 | ||||||||||||
United States | 971,861 | — | — | 971,861 | ||||||||||||
Money Market Funds | 1,108,695 | — | — | 1,108,695 | ||||||||||||
Total Investments | $ | 22,199,983 | $ | 50,070,147 | $ | — | $ | 72,270,130 |
NOTE 4—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $1,363.
NOTE 5—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
13 Invesco Emerging Markets Equity Fund
NOTE 6—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 7—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund had a capital loss carryforward as of October 31, 2017, as follows:
Capital Loss Carryforward* | ||||||||||||
Expiration | Short-Term | Long-Term | Total | |||||||||
Not subject to expiration | $ | 4,030,381 | $ | — | $ | 4,030,381 |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
NOTE 8—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $33,264,679 and $4,907,242, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 11,381,823 | ||
Aggregate unrealized (depreciation) of investments | (1,136,227 | ) | ||
Net unrealized appreciation of investments | $ | 10,245,596 |
Cost of investments for tax purposes is $62,024,534.
14 Invesco Emerging Markets Equity Fund
NOTE 9—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 2,276,278 | $ | 22,715,904 | 1,833,147 | $ | 14,913,268 | ||||||||||
Class C | 517,405 | 5,044,768 | 439,256 | 3,483,436 | ||||||||||||
Class R | 102,244 | 1,025,411 | 110,874 | 878,616 | ||||||||||||
Class Y | 945,519 | 9,480,189 | 709,532 | 5,538,744 | ||||||||||||
Class R6 | 23,917 | 239,592 | 51,683 | 344,289 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 2,661 | 25,488 | 1,567 | 10,624 | ||||||||||||
Class Y | 2,036 | 19,542 | 2,442 | 16,585 | ||||||||||||
Class R5 | 501 | 4,821 | 723 | 4,962 | ||||||||||||
Class R6 | — | — | 3,309 | 22,501 | ||||||||||||
Reacquired: | ||||||||||||||||
Class A | (734,094 | ) | (7,227,591 | ) | (885,522 | ) | (6,918,872 | ) | ||||||||
Class C | (136,777 | ) | (1,328,775 | ) | (139,344 | ) | (1,060,081 | ) | ||||||||
Class R | (61,139 | ) | (605,631 | ) | (51,809 | ) | (429,286 | ) | ||||||||
Class Y | (106,330 | ) | (1,059,530 | ) | (629,373 | ) | (4,797,077 | ) | ||||||||
Class R6 | (1,672 | ) | (16,521 | ) | (976,786 | ) | (7,562,621 | ) | ||||||||
Net increase in share activity | 2,830,549 | $ | 28,317,667 | 469,699 | $ | 4,445,088 |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 30% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
15 Invesco Emerging Markets Equity Fund
NOTE 10—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 9.30 | $ | (0.02 | ) | $ | 0.46 | $ | 0.44 | $ | (0.01 | ) | $ | 9.73 | 4.72 | % | $ | 40,465 | 1.33 | %(d) | 2.01 | %(d) | (0.38 | )%(d) | 8 | % | ||||||||||||||||||||||
Year ended 10/31/17 | 7.13 | 0.03 | 2.15 | 2.18 | (0.01 | ) | 9.30 | 30.57 | 24,297 | 1.36 | 2.45 | 0.30 | 57 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.53 | 0.02 | 0.58 | 0.60 | — | 7.13 | 9.19 | 11,855 | 1.66 | 2.59 | 0.33 | 47 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 7.58 | 0.02 | (1.04 | ) | (1.02 | ) | (0.03 | ) | 6.53 | (13.45 | ) | 10,516 | 1.85 | 2.58 | 0.23 | 97 | ||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 7.61 | 0.06 | (0.03 | ) | 0.03 | (0.06 | ) | 7.58 | 0.44 | 10,654 | 1.85 | 2.57 | 0.74 | 94 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 7.61 | 0.05 | 0.03 | 0.08 | (0.08 | ) | 7.61 | 1.06 | 15,284 | 1.85 | 2.75 | 0.68 | 41 | |||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.04 | (0.05 | ) | 0.44 | 0.39 | — | 9.43 | 4.31 | 10,679 | 2.08 | (d) | 2.76 | (d) | (1.13 | )(d) | 8 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.97 | (0.03 | ) | 2.10 | 2.07 | — | 9.04 | 29.70 | 6,793 | 2.11 | 3.20 | (0.45 | ) | 57 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.43 | (0.03 | ) | 0.57 | 0.54 | — | 6.97 | 8.40 | 3,149 | 2.41 | 3.34 | (0.42 | ) | 47 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 7.49 | (0.04 | ) | (1.02 | ) | (1.06 | ) | — | 6.43 | (14.15 | ) | 2,572 | 2.60 | 3.33 | (0.52 | ) | 97 | |||||||||||||||||||||||||||||||
Year ended 10/31/14 | 7.55 | (0.00 | ) | (0.03 | ) | (0.03 | ) | (0.03 | ) | 7.49 | (0.40 | ) | 2,825 | 2.60 | 3.32 | (0.01 | ) | 94 | ||||||||||||||||||||||||||||||
Year ended 10/31/13 | 7.55 | (0.01 | ) | 0.04 | 0.03 | (0.03 | ) | 7.55 | 0.40 | 2,191 | 2.60 | 3.50 | (0.07 | ) | 41 | |||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.21 | (0.03 | ) | 0.45 | 0.42 | — | 9.63 | 4.56 | 2,687 | 1.58 | (d) | 2.26 | (d) | (0.63 | )(d) | 8 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 7.07 | 0.00 | 2.14 | 2.14 | — | 9.21 | 30.27 | 2,190 | 1.61 | 2.70 | 0.05 | 57 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.50 | 0.01 | 0.56 | 0.57 | — | 7.07 | 8.77 | 1,263 | 1.91 | 2.84 | 0.08 | 47 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 7.55 | (0.00 | ) | (1.03 | ) | (1.03 | ) | (0.02 | ) | 6.50 | (13.71 | ) | 1,188 | 2.10 | 2.83 | (0.02 | ) | 97 | ||||||||||||||||||||||||||||||
Year ended 10/31/14 | 7.59 | 0.04 | (0.03 | ) | 0.01 | (0.05 | ) | 7.55 | 0.17 | 1,341 | 2.10 | 2.82 | 0.49 | 94 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 7.58 | 0.03 | 0.04 | 0.07 | (0.06 | ) | 7.59 | 0.97 | 739 | 2.10 | 3.00 | 0.43 | 41 | |||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.33 | (0.01 | ) | 0.46 | �� | 0.45 | (0.02 | ) | 9.76 | 4.86 | 15,655 | 1.08 | (d) | 1.76 | (d) | (0.13 | )(d) | 8 | ||||||||||||||||||||||||||||||
Year ended 10/31/17 | 7.15 | 0.04 | 2.16 | 2.20 | (0.02 | ) | 9.33 | 30.94 | 7,111 | 1.11 | 2.20 | 0.55 | 57 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.53 | 0.04 | 0.58 | 0.62 | — | 7.15 | 9.49 | 4,858 | 1.41 | 2.34 | 0.58 | 47 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 7.59 | 0.03 | (1.04 | ) | (1.01 | ) | (0.05 | ) | 6.53 | (13.28 | ) | 3,607 | 1.60 | 2.33 | 0.48 | 97 | ||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 7.62 | 0.08 | (0.04 | ) | 0.04 | (0.07 | ) | 7.59 | 0.60 | 3,295 | 1.60 | 2.32 | 0.99 | 94 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 7.61 | 0.07 | 0.04 | 0.11 | (0.10 | ) | 7.62 | 1.42 | 442 | 1.60 | 2.50 | 0.93 | 41 | |||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.33 | (0.01 | ) | 0.46 | 0.45 | (0.02 | ) | 9.76 | 4.86 | 2,056 | 1.08 | (d) | 1.54 | (d) | (0.13 | )(d) | 8 | |||||||||||||||||||||||||||||||
Year ended 10/31/17 | 7.15 | 0.04 | 2.16 | 2.20 | (0.02 | ) | 9.33 | 30.94 | 1,960 | 1.10 | 1.91 | 0.56 | 57 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.53 | 0.04 | 0.58 | 0.62 | — | 7.15 | 9.49 | 1,497 | 1.41 | 1.99 | 0.58 | 47 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 7.60 | 0.03 | (1.05 | ) | (1.02 | ) | (0.05 | ) | 6.53 | (13.40 | ) | 885 | 1.60 | 1.98 | 0.48 | 97 | ||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 7.62 | 0.07 | (0.02 | ) | 0.05 | (0.07 | ) | 7.60 | 0.74 | 896 | 1.60 | 2.02 | 0.99 | 94 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 7.61 | 0.07 | 0.04 | 0.11 | (0.10 | ) | 7.62 | 1.42 | 366 | 1.60 | 2.26 | 0.93 | 41 | |||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.32 | (0.01 | ) | 0.47 | 0.46 | (0.02 | ) | 9.76 | 4.97 | 230 | 1.08 | (d) | 1.54 | (d) | (0.13 | )(d) | 8 | |||||||||||||||||||||||||||||||
Year ended 10/31/17 | 7.15 | 0.04 | 2.15 | 2.19 | (0.02 | ) | 9.32 | 30.80 | 12 | 1.10 | 1.91 | 0.56 | 57 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.54 | 0.04 | 0.57 | 0.61 | — | 7.15 | 9.33 | 6,604 | 1.41 | 1.99 | 0.58 | 47 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 7.60 | 0.03 | (1.04 | ) | (1.01 | ) | (0.05 | ) | 6.54 | (13.26 | ) | 7,171 | 1.60 | 1.98 | 0.48 | 97 | ||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 7.62 | 0.07 | (0.02 | ) | 0.05 | (0.07 | ) | 7.60 | 0.73 | 8,116 | 1.60 | 2.00 | 0.99 | 94 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 7.62 | 0.07 | 0.03 | 0.10 | (0.10 | ) | 7.62 | 1.28 | 8,619 | 1.60 | 2.21 | 0.93 | 41 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $33,705, $9,062, $2,586, $11,939, $2,098 and $118 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
16 Invesco Emerging Markets Equity Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 1,047.20 | $ | 6.75 | $ | 1,018.20 | $ | 6.66 | 1.33 | % | ||||||||||||
C | 1,000.00 | 1,044.30 | 10.54 | 1,014.48 | 10.39 | 2.08 | ||||||||||||||||||
R | 1,000.00 | 1,045.60 | 8.01 | 1,016.96 | 7.90 | 1.58 | ||||||||||||||||||
Y | 1,000.00 | 1,048.60 | 5.49 | 1,019.44 | 5.41 | 1.08 | ||||||||||||||||||
R5 | 1,000.00 | 1,048.60 | 5.49 | 1,019.44 | 5.41 | 1.08 | ||||||||||||||||||
R6 | 1,000.00 | 1,048.70 | 5.49 | 1,019.44 | 5.41 | 1.08 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
17 Invesco Emerging Markets Equity Fund
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Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
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Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your house-hold, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. | ||
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. EME-SAR-1 06072018 1518 |
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
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Invesco Emerging Markets Flexible Bond Fund
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Nasdaq: | ||||
A: IAEMX ∎ C: ICEMX ∎ R: IREMX ∎ Y: IYEMX ∎ R5: IIEMX ∎ R6: IFEMX |
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2
| Fund Performance
| |||
4
| Letters to Shareholders
| |||
5
| Consolidated Schedule of Investments
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12
| Consolidated Financial Statements
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14
| Notes to Consolidated Financial Statements
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25
| Financial Highlights
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26
| Fund Expenses
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27
| Distribution Information
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes |
| |||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance.
|
| |||
Class A Shares | -2.74 | % | ||
Class C Shares | -2.96 | |||
Class R Shares | -2.72 | |||
Class Y Shares | -2.62 | |||
Class R5 Shares | -2.62 | |||
Class R6 Shares | -2.47 | |||
JP Morgan EMBI Global Diversified Index▼ (Broad Market Index) | -2.41 | |||
3-Month USD LIBOR Index∎ (Style-Specific Index) | 0.92 | |||
Lipper Emerging Markets Hard Currency Debt Funds Index◆ (Peer Group Index) | -1.01 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Bloomberg L.P.; ◆Lipper Inc. |
| |||
The JP Morgan EMBI Global Diversified Index is an unmanaged index that tracks the traded market for US dollar-denominated Brady bonds, eurobonds, traded loans and local market debt instruments issued by sovereign and quasi-sovereign entities. The 3-Month USD LIBOR Index is unmanaged index considered representative of the average interest rate at which a selection of banks in London are prepared to lend to one another in American dollars with a maturity of three months. The Lipper Emerging Markets Hard Currency Debt Funds Index is an unmanaged index considered representative of emerging market debt funds tracked by Lipper. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
|
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For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Emerging Markets Flexible Bond Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (6/16/10) | -0.63 | % | ||||
5 Years | -5.89 | |||||
1 Year | -4.07 | |||||
Class C Shares |
| |||||
Inception (6/16/10) | -0.82 | % | ||||
5 Years | -5.77 | |||||
1 Year | -1.44 | |||||
Class R Shares |
| |||||
Inception (6/16/10) | -0.34 | % | ||||
5 Years | -5.32 | |||||
1 Year | 0.02 | |||||
Class Y Shares |
| |||||
Inception (6/16/10) | 0.16 | % | ||||
5 Years | -4.84 | |||||
1 Year | 0.53 | |||||
Class R5 Shares |
| |||||
Inception (6/16/10) | 0.17 | % | ||||
5 Years | -4.81 | |||||
1 Year | 0.53 | |||||
Class R6 Shares |
| |||||
Inception | 0.09 | % | ||||
5 Years | -4.82 | |||||
1 Year | 0.53 |
Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.25%, 2.00%, 1.50%,
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (6/16/10) | -0.42 | % | ||||
5 Years | -5.03 | |||||
1 Year | -1.71 | |||||
Class C Shares |
| |||||
Inception (6/16/10) | -0.61 | % | ||||
5 Years | -4.94 | |||||
1 Year | 0.86 | |||||
Class R Shares |
| |||||
Inception (6/16/10) | -0.14 | % | ||||
5 Years | -4.48 | |||||
1 Year | 2.20 | |||||
Class Y Shares |
| |||||
Inception (6/16/10) | 0.38 | % | ||||
5 Years | -3.98 | |||||
1 Year | 2.87 | |||||
Class R5 Shares |
| |||||
Inception (6/16/10) | 0.39 | % | ||||
5 Years | -3.94 | |||||
1 Year | 2.88 | |||||
Class R6 Shares |
| |||||
Inception | 0.29 | % | ||||
5 Years | -3.99 | |||||
1 Year | 2.71 |
1.00%, 1.00% and 1.00%, respectively.1,2 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.93%, 2.68%, 2.18%, 1.68%, 1.33% and 1.33%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 4.25% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least February 28, 2019. See current prospectus for more information. |
2 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco Emerging Markets Flexible Bond Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s |
prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. |
Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Emerging Markets Flexible Bond Fund
Consolidated Schedule of Investments
April 30, 2018
(Unaudited)
Principal Amount | Value | |||||||
U.S. Dollar Denominated Bonds & Notes–70.23% |
| |||||||
Argentina–6.77% | ||||||||
Argentine Republic Government International Bond, Sr. Unsec. Global Bonds, 6.63%, 07/06/2028 | $ | 850,000 | $ | 822,800 | ||||
Sr. Unsec. Global Notes, 4.63%, 01/11/2023 | 419,000 | 400,459 | ||||||
5.88%, 01/11/2028 | 887,000 | 814,155 | ||||||
6.88%, 01/11/2048 | 753,000 | 670,452 | ||||||
Provincia de Río Negro, Sr. Unsec. Notes, 7.75%, 12/07/2025(a) | 150,000 | 137,625 | ||||||
2,845,491 | ||||||||
Bahrain–1.94% | ||||||||
CBB International Sukuk Co. 7 S.P.C., Sr. Unsec. Notes, 6.88%, 10/05/2025(a) | 600,000 | 600,522 | ||||||
Oil and Gas Holding Co. B.S.C.C. (The), Sr. Unsec. Notes, 7.50%, 10/25/2027(a) | 221,000 | 215,159 | ||||||
815,681 | ||||||||
Brazil–6.72% | ||||||||
Banco BTG Pactual S.A., Sr. Unsec. Notes, 5.50%, 01/31/2023(a) | 271,000 | 264,902 | ||||||
Banco Nacional de Desenvolvimento Economico e Social, Sr. Unsec. Notes, 4.75%, 05/09/2024(a) | 324,000 | 319,788 | ||||||
Brazilian Government International Bond, Sr. Unsec. Global Notes, 4.63%, 01/13/2028 | 219,000 | 211,171 | ||||||
Minerva Luxembourg S.A., Sr. Unsec. Gtd. Notes, 5.88%, 01/19/2028(a) | 900,000 | 804,105 | ||||||
Petrobras Global Finance B.V., |
| |||||||
Sr. Unsec. Gtd. Global Notes, 5.75%, 02/01/2029 | 713,000 | 677,707 | ||||||
7.25%, 03/17/2044 | 550,000 | 548,350 | ||||||
2,826,023 | ||||||||
Canada–0.91% | ||||||||
Gran Tierra Energy International Holdings Ltd., Sr. Unsec. Gtd. Notes, 6.25%, 02/15/2025(a) | 400,000 | 383,000 | ||||||
Chile–1.42% | ||||||||
GeoPark Ltd., Sr. Sec. First Lien Notes, 6.50%, 09/21/2024(a) | 200,000 | 199,500 | ||||||
REGS, Sr. Sec. First Lien Euro Notes, 6.50%, 09/21/2024(a) | 400,000 | 399,000 | ||||||
598,500 |
Principal Amount | Value | |||||||
China–1.39% | ||||||||
Panda Green Energy Group Ltd., REGS, Sr. Unsec. Gtd. Euro Bonds, 8.25%, 01/25/2020(a) | $ | 300,000 | $ | 290,950 | ||||
Ronshine China Holdings Ltd., REGS, Sr. Sec. Gtd. First Lien Euro Bonds, 6.95%, 12/08/2018(a)(b) | 300,000 | 294,710 | ||||||
585,660 | ||||||||
Colombia–4.02% | ||||||||
Canacol Energy Ltd., Sr. Unsec. Gtd. Notes, 7.25%, 05/03/2025(a) | 850,000 | 844,900 | ||||||
Colombia Telecomunicaciones S.A. ESP, REGS, Jr. Unsec. Sub. Euro Notes, 8.50%(a)(c) | 300,000 | 315,000 | ||||||
Ecopetrol S.A., Sr. Unsec. Global Notes, | 550,000 | 532,400 | ||||||
1,692,300 | ||||||||
Costa Rica–0.82% | ||||||||
Instituto Costarricense de Electricidad, REGS, Sr. Unsec. Euro Notes, 6.38%, 05/15/2043(a) | 400,000 | 346,500 | ||||||
El Salvador–1.73% | ||||||||
AES El Salvador Trust II, REGS, Sr. Unsec. Gtd. Euro Notes, 6.75%, 03/28/2023(a) | 600,000 | 582,750 | ||||||
El Salvador Government International Bond, | 127,000 | 145,415 | ||||||
728,165 | ||||||||
Ghana–0.65% | ||||||||
Tullow Oil PLC, Sr. Unsec. Notes, 7.00%, 03/01/2025(a) | 270,000 | 274,064 | ||||||
India–1.99% | ||||||||
Vedanta Resources PLC, |
| |||||||
Sr. Unsec. Notes, 6.13%, 08/09/2024(a) | 269,000 | 259,471 | ||||||
REGS, Sr. Unsec. Euro Notes, 6.13%, 08/09/2024(a) | 600,000 | 578,747 | ||||||
838,218 | ||||||||
Indonesia–0.45% | ||||||||
Indika Energy Capital III Pte., Ltd., Sr. Unsec. Gtd. Notes, 5.88%, 11/09/2024(a) | 200,000 | 188,880 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
5 Invesco Emerging Markets Flexible Bond Fund
Principal Amount | Value | |||||||
Israel–0.18% | ||||||||
Teva Pharmaceutical Finance Netherlands III B.V., | $ | 77,000 | $ | 74,780 | ||||
Jamaica–1.97% | ||||||||
Digicel Group Ltd., REGS, Sr. Unsec. Euro Notes, 8.25%, 09/30/2020(a) | 300,000 | 269,250 | ||||||
Jamaica Government International Bond, Sr. Unsec. Global Notes, 6.75%, 04/28/2028 | 505,000 | 559,161 | ||||||
828,411 | ||||||||
Jordan–0.81% | ||||||||
Jordan Government International Bond, Sr. Unsec. Bonds, | 350,000 | 342,084 | ||||||
Kenya–0.49% | ||||||||
Kenya Government International Bond, Sr. Unsec. Notes, | 200,000 | 206,907 | ||||||
Lebanon–1.32% | ||||||||
Lebanon Government International Bond, |
| |||||||
Sr. Unsec. Medium-Term Euro Notes, 6.40%, 05/26/2023 | 300,000 | 285,001 | ||||||
REGS, Sr. Unsec. Euro Notes, 6.75%, 11/29/2027(a) | 300,000 | 271,490 | ||||||
556,491 | ||||||||
Mexico–11.32% | ||||||||
ALFA, S.A.B. de C.V., REGS, Sr. Unsec. Euro Notes, 6.88%, 03/25/2044(a) | 550,000 | 564,806 | ||||||
Cometa Energia, S.A. de C.V., Sr. Sec. Gtd. Notes, 6.38%, 04/24/2035(a) | 425,000 | 418,094 | ||||||
Mexico City Airport Trust, REGS, Sr. Sec. Euro Bonds, | 923,000 | 824,931 | ||||||
Petróleos Mexicanos, |
| |||||||
Sr. Unsec. Gtd. Global Notes, 6.50%, 03/13/2027 | 66,000 | 68,260 | ||||||
Sr. Unsec. Gtd. Notes, 5.35%, 02/12/2028(a) | 104,000 | 99,466 | ||||||
Sr. Unsec. Notes, 6.35%, 02/12/2048(a) | 690,000 | 636,180 | ||||||
REGS, Sr. Unsec. Gtd. Euro Notes, 5.35%, 02/12/2028(a) | 430,000 | 411,252 | ||||||
Sr. Unsec. Euro Notes, | 350,000 | 322,700 | ||||||
SixSigma Networks Mexico, S.A. de C.V., Sr. Unsec. Gtd. Notes, 7.50%, 05/02/2025(a) | 550,000 | 542,438 | ||||||
REGS, Sr. Unsec. Gtd. Euro Notes, 8.25%, 11/07/2021(a) | 321,000 | 334,643 |
Principal Amount | Value | |||||||
Mexico–(continued) | ||||||||
Unifin Financiera, S.A.B. de C.V. SOFOM, E.N.R., | $ | 290,000 | $ | 282,387 | ||||
Sr. Unsec. Gtd. Bonds, 7.25%, 09/27/2023(a) | 250,000 | 253,600 | ||||||
4,758,757 | ||||||||
Oman–3.44% | ||||||||
Oman Government International Bond, Sr. Unsec. Notes, | 551,000 | 527,272 | ||||||
OmGrid Funding Ltd., | 200,000 | 187,903 | ||||||
Oztel Holdings SPC Ltd. |
| |||||||
Sr. Sec. Gtd. Bonds, 6.63%, 04/24/2028(a) | 384,000 | 375,122 | ||||||
Sr. Sec. Gtd. Notes, 5.63%, 10/24/2023(a) | 361,000 | 356,036 | ||||||
1,446,333 | ||||||||
Paraguay–0.48% | ||||||||
Paraguay Government International Bond, | 200,000 | 200,500 | ||||||
Peru–1.82% | ||||||||
Banco Internacional del Perú S.A.A. Interbank, REGS, Unsec. Sub. Euro Notes, 6.63%, 03/19/2029(a) | 300,000 | 324,000 | ||||||
Inkia Energy Ltd., | 234,000 | 224,055 | ||||||
Peru Enhanced Pass-Through Finance Ltd., REGS, Class A-2, Sr. Sec. First Lien Pass Through Euro Ctfs., 0.00%, 06/02/2025(a)(d) | 250,000 | 215,625 | ||||||
763,680 | ||||||||
Qatar–1.52% | ||||||||
Qatar Government International Bond, |
| |||||||
Sr. Unsec. Notes, | 254,000 | 253,886 | ||||||
5.10%, 04/23/2048(a) | 389,000 | 386,279 | ||||||
640,165 | ||||||||
Russia–4.18% | ||||||||
Russian Foreign Bond, |
| |||||||
Sr. Unsec. Bonds, 4.38%, 03/21/2029(a) | 600,000 | 582,275 | ||||||
5.25%, 06/23/2047(a) | 600,000 | 582,985 | ||||||
Evraz Group S.A., REGS, Sr. Unsec. Euro Notes, | 600,000 | 590,700 | ||||||
1,755,960 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
6 Invesco Emerging Markets Flexible Bond Fund
Principal Amount | Value | |||||||
Senegal–0.58% | ||||||||
Senegal Government International Bond, Unsec. Notes, 6.25%, 05/23/2033(a) | $ | 250,000 | $ | 241,708 | ||||
Singapore–0.67% | ||||||||
Puma International Financing S.A., Sr. Unsec. Gtd. Notes, 5.00%, 01/24/2026(a) | 300,000 | 282,633 | ||||||
South Africa–1.78% | ||||||||
Eskom Holdings SOC Ltd., REGS, Sr. Unsec. Medium-Term Euro Notes, 6.75%, 08/06/2023(a) | 400,000 | 405,804 | ||||||
Petra Diamonds US Treasury PLC, Sec. Gtd. Second Lien Notes, 7.25%, 05/01/2022(a) | 340,000 | 340,680 | ||||||
746,484 | ||||||||
Turkey–5.26% | ||||||||
Akbank T.A.S., | 300,000 | 296,184 | ||||||
REGS, Unsec. Sub. Medium-Term Euro Notes, 7.20%, 03/16/2027(a) | 550,000 | 560,687 | ||||||
Turkcell Iletisim Hizmetleri A.S., Sr. Unsec. Notes, 5.80%, 04/11/2028(a) | 200,000 | 195,212 | ||||||
Turkey Government International Bond, Sr. Unsec. Global Bonds, 6.13%, 10/24/2028 | 200,000 | 199,753 | ||||||
Turkiye Vakiflar Bankasi TAO, Sr. Unsec. Notes, 5.75%, 01/30/2023(a) | 450,000 | 437,310 | ||||||
Yapi ve Kredi Bankasi A.S., | ||||||||
Sr. Unsec. Notes, 5.85%, 06/21/2024(a) | 235,000 | 226,101 | ||||||
6.10%, 03/16/2023(a) | 300,000 | 296,000 | ||||||
2,211,247 | ||||||||
Ukraine–0.84% | ||||||||
Kernel Holding S.A., | 343,000 | 354,010 | ||||||
United Arab Emirates–0.47% | ||||||||
Abu Dhabi National Energy Co. PJSC, Sr. Unsec. Notes, 4.88%, 04/23/2030(a) | 200,000 | 198,626 | ||||||
United States–0.78% | ||||||||
Mattel, Inc., | 400,000 | 326,000 | ||||||
Zambia–3.51% | ||||||||
First Quantum Minerals Ltd., | ||||||||
Sr. Unsec. Gtd. Notes, 7.25%, 04/01/2023(a) | 325,000 | 324,935 | ||||||
7.50%, 04/01/2025(a) | 500,000 | 496,275 |
Principal Amount | Value | |||||||
Zambia–(continued) | ||||||||
Zambia Government International Bond, | $ | 250,000 | $ | 251,813 | ||||
REGS, Sr. Unsec. Euro Notes, 8.50%, 04/14/2024(a) | 200,000 | 202,537 | ||||||
8.97%, 07/30/2027(a) | 200,000 | 201,450 | ||||||
1,477,010 | ||||||||
Total U.S.Dollar Denominated Bonds & Notes |
| 29,534,268 | ||||||
Non U.S. Dollar Denominated Bonds & Notes–31.46%(e) |
| |||||||
Argentina–1.34% | ||||||||
Provincia de Buenos Aires, REGS, Unsec. Floating Rate Bonds, 27.00% (BADLAR + 3.75%), 04/12/2025(a)(f) | ARS | 11,460,000 | 564,248 | |||||
Brazil–3.52% | ||||||||
Brazil Notas do Tesouro Nacional, Series F, Unsec. Notes, 10.00%, 01/01/2023 | BRL | 5,000,000 | 1,481,771 | |||||
Colombia–2.05% | ||||||||
Colombian Titulos De Tesoreria, Class B, Sr. Unsec. Bonds, 10.00%, 07/24/2024 | COP | 2,000,000,000 | 863,985 | |||||
Dominican Republic–0.53% | ||||||||
Dominican Republic International Bond, Sr. Unsec. Notes, 8.90%, 02/15/2023(a) | DOP | 10,600,000 | 221,585 | |||||
India–1.67% | ||||||||
Province of British Columbia, Sr. Unsec. Bonds, 6.60%, 01/09/2020(a) | INR | 47,000,000 | 703,109 | |||||
Indonesia–9.62% | ||||||||
Indonesia Treasury Bond, | ||||||||
Series FR54, | ||||||||
Sr. Unsec. Bonds, 9.50%, 07/15/2031 | IDR | 32,000,000,000 | 2,712,228 | |||||
Series FR72, | ||||||||
Sr. Unsec. Bonds, 8.25%, 05/15/2036 | IDR | 7,000,000,000 | 540,358 | |||||
Series FR75, | ||||||||
Sr. Unsec. Bonds, 7.50%, 05/15/2038 | IDR | 11,000,000,000 | 792,999 | |||||
4,045,585 | ||||||||
Mexico–4.25% | ||||||||
Mexican Bonos, Series M, Sr. Unsec. Bonds, 7.75%, 11/13/2042 | MXN | 33,000,000 | 1,784,912 | |||||
Peru–1.15% | ||||||||
Peru Government Bond, REGS, Sr. Unsec. Bonds, 6.15%, 08/12/2032(a) | PEN | 1,500,000 | 485,188 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
7 Invesco Emerging Markets Flexible Bond Fund
Principal Amount | Value | |||||||
Russia–1.38% | ||||||||
Russian Federal Bond — OFZ, Series 6215, Unsec. Bonds, 7.00%, 08/16/2023 | RUB | 36,000,000 | $ | 578,435 | ||||
South Africa–4.59% | ||||||||
Republic of South Africa Government Bond, | ||||||||
Series 2048, Unsec. Bonds, 8.75%, 02/28/2048 | ZAR | 8,800,000 | 684,633 | |||||
Series 2044, Unsec. Bonds, 8.75%, 01/31/2044 | ZAR | 16,000,000 | 1,244,252 | |||||
1,928,885 | ||||||||
Uruguay–1.36% | ||||||||
Uruguay Government International Bond, Sr. Unsec. Global Notes, 4.38%, 12/15/2028 | UYU | 9,000,000 | 571,523 | |||||
Total Non U.S. Dollar Denominated Bonds & |
| 13,229,226 |
Shares | Value | |||||||
Money Market Funds–7.98% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(g) | 1,174,394 | $ | 1,174,394 | |||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(g) | 838,642 | 838,726 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(g) | 1,342,165 | 1,342,165 | ||||||
Total Money Market Funds |
| 3,355,285 | ||||||
Options Purchased–0.21%(h) |
| |||||||
(Cost $100,378) | 89,294 | |||||||
TOTAL INVESTMENTS IN SECURITIES–109.88% |
| 46,208,073 | ||||||
OTHER ASSETS LESS LIABILITIES–(9.88)% |
| (4,155,704 | ) | |||||
NET ASSETS–100.00% |
| $ | 42,052,369 |
Investment Abbreviations:
ARS | – Argentine Peso | |
BADLAR | – Buenos Aires Deposits of Large Amounts Rate | |
BRL | – Brazilian Real | |
COP | – Colombian Peso | |
Ctfs. | – Certificates | |
DOP | – Dominican Peso |
Gtd. | – Guaranteed | |
IDR | – Indonesian Rupiah | |
INR | – Indian Rupee | |
Jr. | – Junior | |
MXN | – Mexican Peso | |
PEN | – Peruvian Sol | |
REGS | – Regulation S |
RUB | – Russian Ruble | |
Sec. | – Secured | |
Sr. | – Senior | |
Sub. | – Subordinated | |
Unsec. | – Unsecured | |
UYU | – Uruguayan Peso | |
ZAR | – South Aftrican Rand |
Notes to Consolidated Schedule of Investments:
(a) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2018 was $25,392,729, which represented 60.38% of the Fund’s Net Assets. |
(b) | Security has an irrevocable call by the issuer or mandatory put by the holder. Maturity date reflects such call or put. |
(c) | Perpetual bond with no specified maturity date. |
(d) | Zero coupon bond issued at a discount. The interest rate shown represents the yield to maturity at issue. |
(e) | Foreign denominated security. Principal amount is denominated in the currency indicated. |
(f) | Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on April 30, 2018. |
(g) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
(h) | The table below details options purchased. See Notes 1M and 1N. |
Open Over-The-Counter Foreign Currency Options Purchased | ||||||||||||||||||||||||||||||||
Description | Type of Contract | Counterparty | Expiration Date | Exercise Price | Notional Value | Value | ||||||||||||||||||||||||||
EUR versus JPY | Call | Goldman Sachs International | 06/27/2018 | JPY | 140.000 | EUR | 2,000,000 | $ | 670 | |||||||||||||||||||||||
USD versus MXN | Put | Citigroup Global Markets Inc. | 07/17/2018 | MXN | 18.500 | USD | 1,700,000 | 23,747 | ||||||||||||||||||||||||
Subtotal Foreign Currency Options Purchased — Currency Risk |
| $ | 24,417 |
Open Over-The-Counter Interest Rate Swaptions Purchased — Interest Rate Risk | ||||||||||||||||||||||||||||||||||||
Description | Type of Contract | Counterparty | Exercise Rate | Pay/ Receive Exercise Rate | Floating Rate Index | Payment Frequency | Expiration Date | Notional Value | Value | |||||||||||||||||||||||||||
10 Year Interest Rate Swap | Put | Citigroup Global Markets Inc. | 2.860 | % | Pay | 3 Month USD LIBOR | Quarterly | 07/19/2025 | $ | 6,500,000 | $ | 64,877 | ||||||||||||||||||||||||
Total Options Purchased (Cost $100,378) |
| $ | 89,294 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
8 Invesco Emerging Markets Flexible Bond Fund
Open Over-The-Counter Foreign Currency Options Written — Currency Risk | ||||||||||||||||||||||||||||||||||||||||
Description | Type of Contract | Counterparty | Expiration Date | Exercise Price | Premiums Received | Notional Value | Value | Unrealized Appreciation | ||||||||||||||||||||||||||||||||
USD versus MXN | Call | Citigroup Global Markets Inc. | 07/17/2018 | MXN | 22.000 | $ | (38,412 | ) | USD | 1,700,000 | $ | (2,177 | ) | $ | 36,235 |
Open Forward Foreign Currency Contracts | ||||||||||||||||||||||
Settlement
| Counterparty | Contract to | Unrealized Appreciation (Depreciation) | |||||||||||||||||||
Deliver | Receive | |||||||||||||||||||||
05/03/2018 | Barclays Bank PLC | BRL | 4,000,000 | USD | 1,149,062 | $ | 7,707 | |||||||||||||||
05/03/2018 | Deutsche Bank Securities Inc. | BRL | 4,000,000 | USD | 1,149,062 | 7,707 | ||||||||||||||||
05/03/2018 | Goldman Sachs International | BRL | 6,710,000 | USD | 1,994,191 | 79,568 | ||||||||||||||||
05/03/2018 | Merrill Lynch International | BRL | 11,420,000 | USD | 3,298,107 | 39,539 | ||||||||||||||||
05/31/2018 | Barclays Bank PLC | CLP | 190,000,000 | USD | 310,412 | 817 | ||||||||||||||||
05/31/2018 | Barclays Bank PLC | EUR | 950,000 | USD | 1,177,664 | 27,684 | ||||||||||||||||
05/31/2018 | Barclays Bank PLC | JPY | 120,000,000 | USD | 1,128,368 | 28,265 | ||||||||||||||||
05/31/2018 | Barclays Bank PLC | RUB | 100,000,000 | USD | 1,606,023 | 24,162 | ||||||||||||||||
05/31/2018 | Barclays Bank PLC | TRY | 4,000,000 | USD | 1,015,859 | 41,338 | ||||||||||||||||
05/31/2018 | Citigroup Global Markets Inc. | TRY | 2,300,000 | USD | 586,593 | 26,243 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | CLP | 520,000,000 | USD | 858,511 | 11,198 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | EUR | 800,000 | USD | 992,448 | 24,044 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | HUF | 305,000,000 | USD | 1,209,363 | 33,027 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | IDR | 31,000,000,000 | USD | 2,237,944 | 20,060 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | JPY | 285,000,000 | USD | 2,687,161 | 74,416 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | RUB | 18,500,000 | USD | 297,380 | 4,735 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | ZAR | 11,500,000 | USD | 952,519 | 34,135 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | CLP | 430,000,000 | USD | 708,402 | 7,740 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | EUR | 460,000 | USD | 570,733 | 13,901 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | MYR | 7,000,000 | USD | 1,793,988 | 22,574 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | RUB | 50,000,000 | USD | 865,636 | 74,706 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 1,178,918 | COP | 3,400,000,000 | 33,807 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | ZAR | 22,000,000 | USD | 1,789,352 | 32,443 | ||||||||||||||||
05/31/2018 | J.P. Morgan Securities LLC | CZK | 3,000,000 | USD | 142,020 | 235 | ||||||||||||||||
05/31/2018 | Merrill Lynch International | IDR | 21,700,000,000 | USD | 1,583,017 | 30,498 | ||||||||||||||||
05/31/2018 | Merrill Lynch International | INR | 50,000,000 | USD | 763,242 | 13,774 | ||||||||||||||||
05/31/2018 | Merrill Lynch International | THB | 50,000,000 | USD | 1,587,806 | 3,462 | ||||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 1,234,138 | COP | 3,500,000,000 | 14,255 | ||||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 450,740 | MXN | 8,500,000 | 1,615 | ||||||||||||||||
05/31/2018 | Merrill Lynch International | ZAR | 6,780,000 | USD | 564,575 | 23,127 | ||||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | CLP | 740,000,000 | USD | 1,227,401 | 21,610 | ||||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | CZK | 47,000,000 | USD | 2,278,788 | 57,485 | ||||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | EUR | 450,000 | USD | 550,761 | 6,033 | ||||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | JPY | 150,000,000 | USD | 1,400,710 | 25,581 | ||||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | ZAR | 11,000,000 | USD | 928,190 | 49,735 | ||||||||||||||||
06/01/2018 | Deutsche Bank Securities Inc. | PLN | 3,500,000 | USD | 1,021,341 | 23,659 | ||||||||||||||||
06/01/2018 | Morgan Stanley & Co. LLC | PLN | 9,900,000 | USD | 2,902,727 | 80,712 | ||||||||||||||||
06/04/2018 | Merrill Lynch International | BRL | 2,510,000 | USD | 721,959 | 8,113 | ||||||||||||||||
Subtotal — Appreciation |
| 1,029,710 | ||||||||||||||||||||
05/03/2018 | Barclays Bank PLC | USD | 575,457 | BRL | 2,000,000 | (4,779 | ) | |||||||||||||||
05/03/2018 | Deutsche Bank Securities Inc. | USD | 577,134 | BRL | 2,000,000 | (6,457 | ) | |||||||||||||||
05/03/2018 | Goldman Sachs International | USD | 3,855,103 | BRL | 13,420,000 | (25,858 | ) | |||||||||||||||
05/03/2018 | Merrill Lynch International | USD | 2,519,329 | BRL | 8,710,000 | (34,029 | ) | |||||||||||||||
05/31/2018 | Barclays Bank PLC | MXN | 69,758,189 | USD | 3,684,420 | (27,991 | ) | |||||||||||||||
05/31/2018 | Barclays Bank PLC | USD | 2,973,519 | CLP | 1,770,000,000 | (89,398 | ) | |||||||||||||||
05/31/2018 | Barclays Bank PLC | USD | 3,040,267 | RUB | 174,000,000 | (287,830 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
9 Invesco Emerging Markets Flexible Bond Fund
Open Forward Foreign Currency Contracts–(continued) | ||||||||||||||||||||||
Settlement
| Counterparty | Contract to | Unrealized Appreciation (Depreciation) | |||||||||||||||||||
Deliver | Receive | |||||||||||||||||||||
05/31/2018 | Barclays Bank PLC | USD | 570,055 | ZAR | 6,700,000 | $ | (34,996 | ) | ||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | USD | 2,881,546 | CZK | 59,000,000 | (93,101 | ) | |||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | USD | 996,271 | EUR | 810,000 | (15,762 | ) | |||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | USD | 19,552 | HUF | 5,000,000 | (268 | ) | |||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | USD | 579,374 | IDR | 8,000,000,000 | (7,017 | ) | |||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | USD | 2,875,372 | JPY | 306,000,000 | (70,109 | ) | |||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | USD | 779,180 | TRY | 3,100,000 | (23,926 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | COP | 1,000,000,000 | USD | 356,179 | (505 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | TRY | 5,300,000 | USD | 1,288,938 | (2,303 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 582,072 | CLP | 350,000,000 | (11,766 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 1,234,540 | EUR | 1,000,000 | (24,035 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 1,199,607 | HUF | 300,000,000 | (42,554 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 1,782,985 | MYR | 7,000,000 | (11,571 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 1,873,033 | TRY | 7,600,000 | (21,443 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 976,109 | ZAR | 11,700,000 | (41,752 | ) | |||||||||||||||
05/31/2018 | J.P. Morgan Securities LLC | TRY | 2,300,000 | USD | 550,820 | (9,529 | ) | |||||||||||||||
05/31/2018 | J.P. Morgan Securities LLC | USD | 931,756 | EUR | 750,000 | (23,877 | ) | |||||||||||||||
05/31/2018 | J.P. Morgan Securities LLC | USD | 535,756 | ZAR | 6,700,000 | (697 | ) | |||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 572,150 | CLP | 340,000,000 | (18,138 | ) | |||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 1,437,929 | JPY | 150,000,000 | (62,800 | ) | |||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 1,609,788 | THB | 50,000,000 | (25,444 | ) | |||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 820,497 | TRY | 3,200,000 | (40,880 | ) | |||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 454,375 | ZAR | 5,500,000 | (15,148 | ) | |||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | COP | 3,100,000,000 | USD | 1,068,818 | (36,902 | ) | |||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | USD | 937,025 | JPY | 99,000,000 | (29,440 | ) | |||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | USD | 1,170,843 | MXN | 22,000,000 | (41 | ) | |||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | USD | 803,665 | RUB | 50,000,000 | (12,734 | ) | |||||||||||||||
06/01/2018 | Deutsche Bank Securities Inc. | USD | 1,188,756 | PLN | 4,000,000 | (48,548 | ) | |||||||||||||||
06/01/2018 | Goldman Sachs International | USD | 2,623,095 | PLN | 8,900,000 | (86,132 | ) | |||||||||||||||
06/01/2018 | Morgan Stanley & Co. LLC | USD | 574,380 | PLN | 2,000,000 | (4,275 | ) | |||||||||||||||
Subtotal — Depreciation |
| (1,292,035 | ) | |||||||||||||||||||
Total Foreign Currency Contracts — Currency Risk | $ | (262,325 | ) |
Open Over-The-Counter Interest Rate Swap Agreements — Interest Rate Risk | ||||||||||||||||||||||||||||||||||||||||||
Counterparty | Pay/ Receive Floating Rate | Floating Rate Index | Payment Frequency | (Pay)/ Receive Fixed Rate | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation | ||||||||||||||||||||||||||||||||
Citigroup Global Markets Inc. | Pay | CFETS 7-Day CNY Fixing Repo Rates | Quarterly | 3.91 | % | Quarterly | 03/05/2023 | CNY | 15,000,000 | $ | — | $ | 32,453 | $ | 32,453 |
Investment Abbreviations:
BRL | – Brazilian Real | |
CFETS | – China Foreign Exchange Trade System | |
CLP | – Chilean Peso | |
CNY | – Chinese Yuan | |
COP | – Colombian Peso | |
CZK | – Czech Koruna | |
EUR | – Euro | |
HUF | – Hungarian Forint | |
IDR | – Indonesian Rupiah | |
INR | – Indian Rupee |
JPY | – Japanese Yen | |
LIBOR | – London Interbank Offered Rate | |
MXN | – Mexican Peso | |
MYR | – Malaysian Ringgit | |
PLN | – Poland Zloty | |
RUB | – Russian Ruble | |
THB | – Thai Baht | |
TRY | – Turkish Lira | |
USD | – U.S. Dollar | |
ZAR | – South African Rand |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
10 Invesco Emerging Markets Flexible Bond Fund
Portfolio Composition
By industry, based on Total Investments
as of April 30, 2018
Sovereign Debt | 47.1 | % | ||
Integrated Oil & Gas | 7.1 | |||
Other Diversified Financial Services | 4.8 | |||
Diversified Banks | 4.6 | |||
Wireless Telecommunication Services | 3.8 | |||
Oil & Gas Exploration & Production | 3.7 | |||
Independent Power Producers & Energy Traders | 2.2 | |||
Diversified Metals & Mining | 1.8 | |||
Copper | 1.8 | |||
Packaged Foods & Meats | 1.7 | |||
Integrated Telecommunication Services | 1.4 | |||
Electric Utilities | 1.3 | |||
Steel | 1.3 | |||
Industrial Conglomerates | 1.2 | |||
Consumer Finance | 1.2 | |||
Industry Type Each Less Than 1% of Portfolio | 7.7 | |||
Money Market Funds | 7.3 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
11 Invesco Emerging Markets Flexible Bond Fund
Consolidated Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: | ||||
Investments in securities, at value (Cost $43,167,947) | $ | 42,852,788 | ||
Investments in affiliated money market funds, at value (Cost $3,355,188) | 3,355,285 | |||
Other investments: |
| |||
Swaps receivable — OTC | 14,463 | |||
Unrealized appreciation on forward foreign currency contracts outstanding | 1,029,710 | |||
Unrealized appreciation on swap agreements — OTC | 32,453 | |||
Deposits with brokers: |
| |||
Cash collateral — centrally cleared swap agreements | 70,000 | |||
Cash collateral OTC Derivatives | 320,000 | |||
Cash | 65,348 | |||
Receivable for: |
| |||
Investments sold | 10,323,886 | |||
Fund shares sold | 150,569 | |||
Dividends and interest | 756,664 | |||
Investment for trustee deferred compensation and retirement plans | 29,398 | |||
Other assets | 59,869 | |||
Total assets | 59,060,433 | |||
Liabilities: | ||||
Other investments: |
| |||
Options written, at value (premiums received $38,412) | 2,177 | |||
Swaps payable — OTC | 12,206 | |||
Unrealized depreciation on forward foreign currency contracts outstanding | 1,292,035 | |||
Payable for: |
| |||
Investments purchased | 2,525,116 | |||
Fund shares reacquired | 13,068,319 | |||
Accrued fees to affiliates | 15,227 | |||
Accrued trustees’ and officers’ fees and benefits | 1,518 | |||
Accrued other operating expenses | 60,941 | |||
Trustee deferred compensation and retirement plans | 30,525 | |||
Total liabilities | 17,008,064 | |||
Net assets applicable to shares outstanding | $ | 42,052,369 | ||
Net assets consist of: | ||||
Shares of beneficial interest | $ | 44,467,094 | ||
Undistributed net investment income | 246,628 | |||
Undistributed net realized gain (loss) | (2,126,646 | ) | ||
Net unrealized appreciation (depreciation) | (534,707 | ) | ||
$ | 42,052,369 |
Net Assets: | ||||
Class A | $ | 4,160,332 | ||
Class C | $ | 1,251,824 | ||
Class R | $ | 111,363 | ||
Class Y | $ | 2,189,640 | ||
Class R5 | $ | 6,543 | ||
Class R6 | $ | 34,332,667 | ||
Shares outstanding, no par value, |
| |||
Class A | 649,824 | |||
Class C | 195,467 | |||
Class R | 17,413 | |||
Class Y | 342,133 | |||
Class R5 | 1,023 | |||
Class R6 | 5,369,914 | |||
Class A: |
| |||
Net asset value per share | $ | 6.40 | ||
Maximum offering price per share | $ | 6.68 | ||
Class C: |
| |||
Net asset value and offering price per share | $ | 6.40 | ||
Class R: |
| |||
Net asset value and offering price per share | $ | 6.40 | ||
Class Y: |
| |||
Net asset value and offering price per share | $ | 6.40 | ||
Class R5: |
| |||
Net asset value and offering price per share | $ | 6.40 | ||
Class R6: |
| |||
Net asset value and offering price per share | $ | 6.39 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
12 Invesco Emerging Markets Flexible Bond Fund
Consolidated Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Interest (net of foreign withholding taxes of $24,071) | $ | 1,647,895 | ||
Dividends from affiliated money market funds | 25,776 | |||
Total investment income | 1,673,671 | |||
Expenses: |
| |||
Advisory fees | 214,340 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 23,959 | |||
Distribution fees: |
| |||
Class A | 5,710 | |||
Class B | 155 | |||
Class C | 7,008 | |||
Class R | 511 | |||
Transfer agent fees — A, B, C, R & Y | 11,955 | |||
Transfer agent fees — R6 | 90 | |||
Trustees’ and officers’ fees and benefits | 10,979 | |||
Registration and filing fees | 44,644 | |||
Reports to shareholders | 11,326 | |||
Professional services fees | 42,643 | |||
Other | 17,164 | |||
Total expenses | 415,279 | |||
Less: Fees waived, expenses reimbursed and expense offset arrangement(s) | (121,452 | ) | ||
Net expenses | 293,827 | |||
Net investment income | 1,379,844 | |||
Realized and unrealized gain (loss) from: |
| |||
Net realized gain (loss) from: |
| |||
Investment securities | (176,978 | ) | ||
Foreign currencies | (78,509 | ) | ||
Forward foreign currency contracts | (282,728 | ) | ||
Futures contracts | 76,143 | |||
Option contracts written | (10,299 | ) | ||
Swap agreements | (295,408 | ) | ||
(767,779 | ) | |||
Change in net unrealized appreciation (depreciation) of: |
| |||
Investment securities | (1,744,500 | ) | ||
Foreign currencies | (13,026 | ) | ||
Forward foreign currency contracts | (568,145 | ) | ||
Futures contracts | 42,905 | |||
Option contracts written | 35,277 | |||
Swap agreements | 143,961 | |||
(2,103,528 | ) | |||
Net realized and unrealized gain (loss) | (2,871,307 | ) | ||
Net increase (decrease) in net assets resulting from operations | $ | (1,491,463 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
13 Invesco Emerging Markets Flexible Bond Fund
Consolidated Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income | $ | 1,379,844 | $ | 3,383,259 | ||||
Net realized gain (loss) | (767,779 | ) | (374,815 | ) | ||||
Change in net unrealized appreciation (depreciation) | (2,103,528 | ) | 1,078,584 | |||||
Net increase (decrease) in net assets resulting from operations | (1,491,463 | ) | 4,087,028 | |||||
Distributions to shareholders from net investment income: |
| |||||||
Class A | (89,857 | ) | (163,006 | ) | ||||
Class B | (508 | ) | (2,408 | ) | ||||
Class C | (22,324 | ) | (34,538 | ) | ||||
Class R | (3,578 | ) | (9,158 | ) | ||||
Class Y | (43,069 | ) | (46,029 | ) | ||||
Class R5 | (140 | ) | (266 | ) | ||||
Class R6 | (1,012,176 | ) | (2,155,646 | ) | ||||
Total distributions from net investment income | (1,171,652 | ) | (2,411,051 | ) | ||||
Share transactions–net: |
| |||||||
Class A | (465,418 | ) | (467,124 | ) | ||||
Class B | (68,467 | ) | (54,285 | ) | ||||
Class C | 96,320 | (4,002 | ) | |||||
Class R | (165,552 | ) | 11,179 | |||||
Class Y | 314,251 | 1,593,643 | ||||||
Class R6 | (12,881,520 | ) | (12,694,404 | ) | ||||
Net increase (decrease) in net assets resulting from share transactions | (13,170,386 | ) | (11,614,993 | ) | ||||
Net increase (decrease) in net assets | (15,833,501 | ) | (9,939,016 | ) | ||||
Net assets: |
| |||||||
Beginning of period | 57,885,870 | 67,824,886 | ||||||
End of period (includes undistributed net investment income of $246,628 and $ $38,436, respectively) | $ | 42,052,369 | $ | 57,885,870 |
Notes to Consolidated Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Emerging Markets Flexible Bond Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these consolidated financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund will seek to gain exposure to the commodity markets primarily through investments in the Invesco Emerging Markets Flexible Bond Cayman Ltd. (the “Subsidiary”), a wholly-owned subsidiary of the Fund organized under the laws of the Cayman Islands. The Subsidiary was organized by the Fund to invest in commodity-linked derivatives and other securities that may provide leveraged and non-leveraged exposure to commodities. The Fund may invest up to 25% of its total assets in the Subsidiary.
The Fund’s investment objective is total return through growth of capital and current income.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Effective November 30, 2010, new or additional investments in Class B shares are no longer permitted. Existing shareholders of Class B shares were permitted to continue to reinvest dividends and capital gains distributions in Class B shares until their conversion to Class A shares. Also, shareholders in Class B shares were able to exchange those shares for Class B shares of other Invesco Funds offering such shares until they converted to Class A shares. Generally, Class B shares automatically converted to Class A shares on or about the month-end, which was at least eight years after the date of purchase. Redemptions of Class B shares prior to the conversion date were subject to a
14 Invesco Emerging Markets Flexible Bond Fund
CDSC. Effective January 26, 2018, all of the Fund’s outstanding Class B shares were converted to Class A shares, in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its consolidated financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the consolidated financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
15 Invesco Emerging Markets Flexible Bond Fund
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Consolidated Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Consolidated Statement of Operations and the Consolidated Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Consolidated Statement of Operations and the Consolidated Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Consolidated Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income, if any, are declared and paid quarterly and are recorded on the ex-dividend date. Distributions from net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the consolidated financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Subsidiary is classified as a controlled foreign corporation under Subchapter N of the Internal Revenue Code. Therefore, the Fund is required to increase its taxable income by its share of the Subsidiary’s income. Net investment losses of the Subsidiary cannot be deducted by the Fund in the current period nor carried forward to offset taxable income in future periods.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The financial statements are prepared on a consolidated basis in conformity with accounting principles generally accepted in the United States of America (“GAAP”), which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. The accompanying financial statements reflect the financial position of the Fund and its Subsidiary and the results of operations on a consolidated basis. All inter-company accounts and transactions have been eliminated in consolidation. |
In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the consolidated financial statements are released to print.
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust, and under the Subsidiary’s organizational documents, the directors and officers of the Subsidiary, are indemnified against certain liabilities that may arise out of the performance of their duties to the Fund and/or the Subsidiary, respectively. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Structured Securities — The Fund may invest in structured securities. Structured securities are a type of derivative security whose value is determined by reference to changes in the value of underlying securities, currencies, interest rates, commodities, indices or other financial indicators (“reference instruments”). Most structured securities are fixed-income securities that have maturities of three years or less. Structured securities may be positively or negatively indexed (i.e., their principal value or interest rates may increase or decrease if the underlying reference instrument appreciates) and may have return characteristics similar to direct investments in the underlying reference instrument. |
Structured securities may entail a greater degree of market risk than other types of debt securities because the investor bears the risk of the reference instruments. In addition to the credit risk of structured securities and the normal risks of price changes in response to changes in interest rates, the principal amount of structured notes or indexed securities may decrease as a result of changes in the value of the underlying reference instruments. Changes in the daily value of structured securities are recorded as unrealized gains (losses) in the Consolidated Statement of Operations. When the structured securities mature or are sold, the Fund recognizes a realized gain (loss) on the Consolidated Statement of Operations.
16 Invesco Emerging Markets Flexible Bond Fund
J. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Consolidated Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Consolidated Statement of Operations.
K. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Consolidated Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Consolidated Statement of Assets and Liabilities.
L. | Futures Contracts — The Fund may enter into futures contracts to equitize the Fund’s cash holdings or to manage exposure to interest rate, equity, commodity and market price movements and/or currency risks. A futures contract is an agreement between Counterparties to purchase or sell a specified underlying security, currency or commodity (or delivery of a cash settlement price, in the case of an index future) for a fixed price at a future date. The Fund currently invests only in exchange-traded futures and they are standardized as to maturity date and underlying financial instrument. Initial margin deposits required upon entering into futures contracts are satisfied by the segregation of specific securities or cash as collateral at the futures commission merchant (broker). During the period the futures contracts are open, changes in the value of the contracts are recognized as unrealized gains or losses by recalculating the value of the contracts on a daily basis. Subsequent or variation margin payments are received or made depending upon whether unrealized gains or losses are incurred. These amounts are reflected as receivables or payables on the Consolidated Statement of Assets and Liabilities. When the contracts are closed or expire, the Fund recognizes a realized gain or loss equal to the difference between the proceeds from, or cost of, the closing transaction and the Fund’s basis in the contract. The net realized gain (loss) and the change in unrealized gain (loss) on futures contracts held during the period is included on the Consolidated Statement of Operations. The primary risks associated with futures contracts are market risk and the absence of a liquid secondary market. If the Fund were unable to liquidate a futures contract and/or enter into an offsetting closing transaction, the Fund would continue to be subject to market risk with respect to the value of the contracts and continue to be required to maintain the margin deposits on the futures contracts. Futures contracts have minimal Counterparty risk since the exchange’s clearinghouse, as Counterparty to all exchange-traded futures, guarantees the futures against default. Risks may exceed amounts recognized in the Consolidated Statement of Assets and Liabilities. |
M. | Call Options Purchased and Written — The Fund may write covered call options and/or buy call options. A covered call option gives the purchaser of such option the right to buy, and the writer the obligation to sell, the underlying security or foreign currency at the stated exercise price during the option period. Options written by the Fund normally will have expiration dates between three and nine months from the date written. The exercise price of a call option may be below, equal to, or above the current market value of the underlying security at the time the option is written. |
Additionally, the Fund may enter into an option on a swap agreement, also called a “swaption”. A swaption is an option that gives the buyer the right, but not the obligation, to enter into a swap on a future date in exchange for paying a market-based premium. A receiver swaption gives the owner the right to receive the total return of a specified asset, reference rate or index. Swaptions also include options that allow an existing swap to be terminated or extended by one of the Counterparties.
When the Fund writes a covered call option, an amount equal to the premium received by the Fund is recorded as an asset and an equivalent liability in the Consolidated Statement of Assets and Liabilities. The amount of the liability is subsequently “marked-to-market” to reflect the current market value of the option written. If a written covered call option expires on the stipulated expiration date, or if the Fund enters into a closing purchase transaction, the Fund realizes a gain (or a loss if the closing purchase transaction exceeds the premium received when the option was written) without regard to any unrealized gain or loss on the underlying security, and the liability related to such option is extinguished. If a written covered call option is exercised, the Fund realizes a gain or a loss from the sale of the underlying security and the proceeds of the sale are increased by the premium originally received. Realized and unrealized gains and losses on call options written are included in the Consolidated Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Option contracts written. A risk in writing a covered call option is that the Fund gives up the opportunity for profit if the market price of the security increases and the option is exercised.
17 Invesco Emerging Markets Flexible Bond Fund
When the Fund buys a call option, an amount equal to the premium paid by the Fund is recorded as an investment on the Consolidated Statement of Assets and Liabilities. The amount of the investment is subsequently “marked-to-market” to reflect the current value of the option purchased. Realized and unrealized gains and losses on call options purchased are included in the Consolidated Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Investment securities. A risk in buying an option is that the Fund pays a premium whether or not the option is exercised. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased.
N. | Put Options Purchased and Written — The Fund may purchase and write put options including options on securities indexes, or foreign currency and/or futures contracts. By purchasing a put option, the Fund obtains the right (but not the obligation) to sell the option’s underlying instrument at a fixed strike price. In return for this right, the Fund pays an option premium. The option’s underlying instrument may be a security, securities index, or a futures contract. Put options may be used by the Fund to hedge securities it owns by locking in a minimum price at which the Fund can sell. If security prices fall, the put option could be exercised to offset all or a portion of the Fund’s resulting losses. At the same time, because the maximum the Fund has at risk is the cost of the option, purchasing put options does not eliminate the potential for the Fund to profit from an increase in the value of the underlying portfolio securities. The Fund may write put options to earn additional income in the form of option premiums if it expects the price of the underlying instrument to remain stable or rise during the option period so that the option will not be exercised. The risk in this strategy is that the price of the underlying securities may decline by an amount greater than the premium received. Put options written are reported as a liability in the Consolidated Statement of Assets and Liabilities. Realized and unrealized gains and losses on put options purchased and put options written are included in the Consolidated Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Investment securities and Option contracts written, respectively. A risk in buying an option is that the Fund pays a premium whether or not the option is exercised. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased. |
O. | Swap Agreements — The Fund may enter into various swap transactions, including interest rate, total return, index, currency and credit default swap contracts (“CDS”) for investment purposes or to manage interest rate, currency, commodity or credit risk. Such transactions are agreements between two parties (“Counterparties”). A swap agreement may be negotiated bilaterally and traded over-the-counter (“OTC”) between two parties (“uncleared/OTC”) or, in some instances, must be transacted through a future commission merchant (“FCM”) and cleared through a clearinghouse that serves as a central Counterparty (“centrally cleared swap”). These agreements may contain among other conditions, events of default and termination events, and various covenants and representations such as provisions that require the Fund to maintain a pre-determined level of net assets, and/or provide limits regarding the decline of the Fund’s NAV over specific periods of time. If the Fund were to trigger such provisions and have open derivative positions at that time, the Counterparty may be able to terminate such agreement and request immediate payment in an amount equal to the net liability positions, if any. |
Interest rate, total return, index, and currency swap agreements are two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a notional amount, i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate or return of an underlying asset, in a particular foreign currency, or in a “basket” of securities representing a particular index.
In a centrally cleared swap, the Fund’s ultimate Counterparty is a central clearinghouse. The Fund initially will enter into centrally cleared swaps through an executing broker. When a fund enters into a centrally cleared swap, it must deliver to the central Counterparty (via the FCM) an amount referred to as “initial margin.” Initial margin requirements are determined by the central Counterparty, but an FCM may require additional initial margin above the amount required by the central Counterparty. Initial margin deposits required upon entering into centrally cleared swaps are satisfied by cash or securities as collateral at the FCM. Securities deposited as initial margin are designated on the Consolidated Schedule of Investments and cash deposited is recorded on the Consolidated Statement of Assets and Liabilities. During the term of a cleared swap agreement, a “variation margin” amount may be required to be paid by the Fund or may be received by the Fund, based on the daily change in price of the underlying reference instrument subject to the swap agreement and is recorded as a receivable or payable for variation margin in the Consolidated Statement of Assets and Liabilities until the centrally cleared swap is terminated at which time a realized gain or loss is recorded.
A CDS is an agreement between Counterparties to exchange the credit risk of an issuer. A buyer of a CDS is said to buy protection by paying a fixed payment over the life of the agreement and in some situations an upfront payment to the seller of the CDS. If a defined credit event occurs (such as payment default or bankruptcy), the Fund as a protection buyer would cease paying its fixed payment, the Fund would deliver eligible bonds issued by the reference entity to the seller, and the seller would pay the full notional value, or the “par value”, of the referenced obligation to the Fund. A seller of a CDS is said to sell protection and thus would receive a fixed payment over the life of the agreement and an upfront payment, if applicable. If a credit event occurs, the Fund as a protection seller would cease to receive the fixed payment stream, the Fund would pay the buyer “par value” or the full notional value of the referenced obligation, and the Fund would receive the eligible bonds issued by the reference entity. In turn, these bonds may be sold in order to realize a recovery value. Alternatively, the seller of the CDS and its Counterparty may agree to net the notional amount and the market value of the bonds and make a cash payment equal to the difference to the buyer of protection. If no credit event occurs, the Fund receives the fixed payment over the life of the agreement. As the seller, the Fund would effectively add leverage to its portfolio because, in addition to its total net assets, the Fund would be subject to investment exposure on the notional amount of the CDS. In connection with these agreements, cash and securities may be identified as collateral in accordance with the terms of the respective swap agreements to provide assets of value and recourse in the event of default under the swap agreement or bankruptcy/insolvency of a party to the swap agreement. If a Counterparty becomes bankrupt or otherwise fails to perform its obligations due to financial difficulties, the Fund may experience significant delays in obtaining any recovery in a bankruptcy or other reorganization proceeding. The Fund may obtain only limited recovery or may obtain no recovery in such circumstances. The Fund’s maximum risk of loss from Counterparty risk, either as the protection seller or as the protection buyer, is the value of the contract. The risk may be mitigated by having a master netting arrangement between the Fund and the Counterparty and by the designation of collateral by the Counterparty to cover the Fund’s exposure to the Counterparty.
Implied credit spreads represent the current level at which protection could be bought or sold given the terms of the existing CDS contract and serve as an indicator of the current status of the payment/performance risk of the CDS. An implied spread that has widened or increased since
18 Invesco Emerging Markets Flexible Bond Fund
entry into the initial contract may indicate a deteriorating credit profile and increased risk of default for the reference entity. A declining or narrowing spread may indicate an improving credit profile or decreased risk of default for the reference entity. Alternatively, credit spreads may increase or decrease reflecting the general tolerance for risk in the credit markets.
An interest rate swap is an agreement between Counterparties pursuant to which the parties exchange a floating rate payment for a fixed rate payment based on a specified notional amount.
A total return swap is an agreement in which one party makes payments based on a set rate, either fixed or variable, while the other party makes payments based on the return of an underlying asset, which includes both the income generated and capital gains, if any. The unrealized appreciation (depreciation) on total return swaps includes dividends on the underlying securities and financing rate payable from the Counterparty. At the maturity date, a net cash flow is exchanged where the total return is equivalent to the return of the underlying reference less a financing rate, if any. As a receiver, the Fund would receive payments based on any positive total return and would owe payments in the event of a negative total return. As the payer, the Fund would owe payments on any net positive total return, and would receive payment in the event of a negative total return.
Changes in the value of centrally cleared and OTC swap agreements are recognized as unrealized gains (losses) in the Consolidated Statement of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Consolidated Statement of Assets and Liabilities and may be referred to as upfront payments. The Fund accrues for the fixed payment stream and amortizes upfront payments, if any, on swap agreements on a daily basis with the net amount, recorded as a component of realized gain (loss) on the Consolidated Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Consolidated Statement of Operations. The Fund segregates cash or liquid securities having a value at least equal to the amount of the potential obligation of a Fund under any swap transaction. Cash held as collateral is recorded as deposits with brokers on the Consolidated Statement of Assets and Liabilities. Entering into these agreements involves, to varying degrees, lack of liquidity and elements of credit, market, and Counterparty risk in excess of amounts recognized on the Consolidated Statement of Assets and Liabilities. Such risks involve the possibility that a swap is difficult to sell or liquidate; the Counterparty does not honor its obligations under the agreement and unfavorable interest rates and market fluctuations. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund’s exposure is unlimited.
Notional amounts of each individual credit default swap agreement outstanding as of April 30, 2018 for which the Fund is the seller of protection are disclosed in the open swap agreements table. These potential amounts would be partially offset by any recovery values of the respective referenced obligations, upfront payments received upon entering into the agreement, or net amounts received from the settlement of buy protection credit default swap agreements entered into by the Fund for the same referenced entity or entities.
P. | Other Risks — The Fund will seek to gain exposure to commodity markets primarily through an investment in the Subsidiary and through investments in exchange-traded funds and commodity-linked derivatives. The Subsidiary, unlike the Fund, may invest without limitation in commodities, commodity-linked derivatives and other securities, such as exchange-traded and commodity-linked notes, that may provide leveraged and non-leveraged exposure to commodity markets. The Fund is indirectly exposed to the risks associated with the Subsidiary’s investments. |
The Fund is non-diversified and may invest in securities of fewer issuers than if it were diversified. Thus, the value of the Fund’s shares may vary more widely and the Fund may be subject to greater market and credit risk than if the Fund invested more broadly.
Q. | Leverage Risk — Leverage exists when the Fund can lose more than it originally invests because it purchases or sells an instrument or enters into a transaction without investing an amount equal to the full economic exposure of the instrument or transaction. |
R. | Collateral — To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund’s practice to replace such collateral no later than the next business day. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $500 million | 0.75% | |||
Next $500 million | 0.70% | |||
Next $500 million | 0.67% | |||
Over $1.5 billion | 0.65% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.75%.
The Subsidiary has entered into a separate contract with the Adviser whereby the Adviser provides investment advisory and other services to the Subsidiary. In consideration of these services, the Subsidiary pays an advisory fee to the Adviser based on the annual rate of the Subsidiary’s average daily net assets as set forth in the table above.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
19 Invesco Emerging Markets Flexible Bond Fund
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.24%, 1.99%, 1.49%, 0.99%, 0.99% and 0.99%, respectively, of the Fund’s average daily net assets (the “expense limits”). Prior to their conversion to Class A shares, the expense limit for Class B shares was 1.99% of average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Acquired Fund Fees and Expenses are not operating expenses of the Fund directly, but are fees and expenses, including management fees, of the investment companies in which the Fund invests. As a result, the total annual fund operating expenses after expense reimbursement may exceed the expense limits above. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $109,407 and reimbursed class level expenses of $6,476, $44, $1,987, $290, $2,906 and $90 of Class A, Class C, Class R, Class Y and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Consolidated Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Consolidated Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. Prior to their conversion to Class A shares, the Fund paid an annual rate of 1.00% of the average daily net assets of Class B shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Consolidated Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $596 in front-end sales commissions from the sale of Class A shares.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the consolidated financial statements may materially differ from the value received upon actual sale of those investments.
20 Invesco Emerging Markets Flexible Bond Fund
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
U.S. Dollar Denominated Bonds & Notes | $ | — | $ | 29,534,268 | $ | — | $ | 29,534,268 | ||||||||
Non-U.S. Dollar Denominated Bonds & Notes | — | 13,229,226 | — | 13,229,226 | ||||||||||||
Money Market Funds | 3,355,285 | — | — | 3,355,285 | ||||||||||||
Options Purchased | — | 89,294 | — | 89,294 | ||||||||||||
Total Investments in Securities | 3,355,285 | 42,852,788 | — | 46,208,073 | ||||||||||||
Other Investments — Assets* | ||||||||||||||||
Forward Foreign Currency Contracts | — | 1,029,710 | — | 1,029,710 | ||||||||||||
Swap Agreements | — | 32,453 | — | 32,453 | ||||||||||||
— | 1,062,163 | — | 1,062,163 | |||||||||||||
Other Investments — Liabilities* | ||||||||||||||||
Forward Foreign Currency Contracts | — | (1,292,035 | ) | — | (1,292,035 | ) | ||||||||||
Options Written | — | (2,177 | ) | — | (2,177 | ) | ||||||||||
— | (1,294,212 | ) | — | (1,294,212 | ) | |||||||||||
Total Other Investments | — | (232,049 | ) | — | (232,049 | ) | ||||||||||
Total Investments | $ | 3,355,285 | $ | 42,620,739 | $ | — | $ | 45,976,024 |
* | Forward foreign currency contracts and swap agreements are valued at unrealized appreciation (depreciation). Options written are shown at value. |
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Consolidated Statement of Assets and Liabilities.
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2018:
Value | ||||||||||||
Derivative Assets | Currency Risk | Interest Rate Risk | Total | |||||||||
Unrealized appreciation on swap agreements — OTC | $ | — | $ | 32,453 | $ | 32,453 | ||||||
Options purchased, at value — OTC(a) | 24,417 | 64,877 | 89,294 | |||||||||
Unrealized appreciation on forward foreign currency contracts outstanding | 1,029,710 | — | 1,029,710 | |||||||||
Total Derivative Assets | 1,054,127 | 97,330 | 1,151,457 | |||||||||
Derivatives not subject to master netting agreements | — | — | — | |||||||||
Total Derivative Assets subject to master netting agreements | $ | 1,054,127 | $ | 97,330 | $ | 1,151,457 | ||||||
Value | ||||||||||||
Derivative Liabilities | Currency Risk | Interest Rate Risk | Total | |||||||||
Options written, at value — OTC | $ | (2,177 | ) | $ | — | $ | (2,177 | ) | ||||
Unrealized depreciation on forward foreign currency contracts outstanding | (1,292,035 | ) | — | (1,292,035 | ) | |||||||
Total Derivative Liabilities | (1,294,212 | ) | — | (1,294,212 | ) | |||||||
Derivatives not subject to master netting agreements | — | — | — | |||||||||
Total Derivative Liabilities subject to master netting agreements | $ | (1,294,212 | ) | $ | — | $ | (1,294,212 | ) |
(a) | Options purchased, at value, as reported in the Consolidated Schedule of Investments. |
21 Invesco Emerging Markets Flexible Bond Fund
Offsetting Assets and Liabilities
The table below reflects the Fund’s exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of April 30, 2018.
Financial Derivative Assets | Financial Derivative Liabilities | Collateral (Received)/Pledged | ||||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Options Purchased | Swap Agreements | Total Assets | Forward Foreign Currency Contracts | Options Written | Swap Agreements | Total Liabilities | Net Value of | Non-Cash | Cash | Net Amount | ||||||||||||||||||||||||||||||||||||
Parent | ||||||||||||||||||||||||||||||||||||||||||||||||
Barclays Bank PLC | $ | 129,973 | $ | — | $ | — | $ | 129,973 | $ | (444,994 | ) | $ | — | $ | — | $ | (444,994 | ) | $ | (315,021 | ) | $ | — | $ | 315,021 | $ | — | |||||||||||||||||||||
Citigroup Global Markets Inc. | 26,243 | 88,624 | 46,916 | 161,783 | — | (2,177 | ) | (12,206 | ) | (14,383 | ) | 147,400 | — | — | 147,400 | |||||||||||||||||||||||||||||||||
Deutsche Bank Securities Inc. | 232,981 | — | — | 232,981 | (265,188 | ) | — | — | (265,188 | ) | (32,207 | ) | — | — | (32,207 | ) | ||||||||||||||||||||||||||||||||
Goldman Sachs International | 264,739 | 670 | — | 265,409 | (267,919 | ) | — | — | (267,919 | ) | (2,510 | ) | — | — | (2,510 | ) | ||||||||||||||||||||||||||||||||
J.P. Morgan Securities LLC | 235 | — | — | 235 | (34,103 | ) | — | — | (34,103 | ) | (33,868 | ) | — | — | (33,868 | ) | ||||||||||||||||||||||||||||||||
Merrill Lynch International | 134,383 | — | — | 134,383 | (196,439 | ) | — | — | (196,439 | ) | (62,056 | ) | — | — | (62,056 | ) | ||||||||||||||||||||||||||||||||
Morgan Stanley & Co. LLC | 241,156 | — | — | 241,156 | (83,392 | ) | — | — | (83,392 | ) | 157,764 | — | — | 157,764 | ||||||||||||||||||||||||||||||||||
Total | $ | 1,029,710 | $ | 89,294 | $ | 46,916 | $ | 1,165,920 | $ | (1,292,035 | ) | $ | (2,177 | ) | $ | (12,206 | ) | $ | (1,306,418 | ) | $ | (140,498 | ) | $ | — | $ | 315,021 | $ | 174,523 |
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Consolidated Statement of Operations | ||||||||||||||||||||
Commodity Risk | Credit Risk | Currency Risk | Interest Rate Risk | Total | ||||||||||||||||
Realized Gain (Loss): | ||||||||||||||||||||
Forward foreign currency contracts | $ | — | $ | — | $ | (282,728 | ) | $ | — | $ | (282,728 | ) | ||||||||
Futures contracts | (25,882 | ) | — | — | 102,025 | 76,143 | ||||||||||||||
Options purchased(a) | — | — | (33,180 | ) | 87,552 | 54,372 | ||||||||||||||
Options written | — | — | (10,299 | ) | — | (10,299 | ) | |||||||||||||
Swap agreements | — | (15,600 | ) | — | (279,808 | ) | (295,408 | ) | ||||||||||||
Change in Net Unrealized Appreciation (Depreciation): | ||||||||||||||||||||
Forward foreign currency contracts | — | — | (568,145 | ) | — | (568,145 | ) | |||||||||||||
Futures contracts | 528 | — | — | 42,377 | 42,905 | |||||||||||||||
Options purchased(a) | — | — | (1,874 | ) | 900 | (974 | ) | |||||||||||||
Options written | — | — | 35,277 | — | 35,277 | |||||||||||||||
Swap agreements | — | (23,905 | ) | — | 167,866 | 143,961 | ||||||||||||||
Total | $ | (25,354 | ) | $ | (39,505 | ) | $ | (860,949 | ) | $ | 120,912 | $ | (804,896 | ) |
(a) | Options purchased are included in the net realized gain (loss) from investment securities and the change in net unrealized appreciation (depreciation) of investment securities. |
The table below summarizes the two-month average notional value of futures contracts and the six-month average notional value of forward foreign currency contracts, options purchased, options written and swap agreements.
Futures Contracts | Forward Foreign Currency Contracts | Options Purchased | Options Written | Swap Agreements | ||||||||||||||||
Average notional value | $ | 9,058,917 | $ | 66,983,506 | $ | 4,098,651 | $ | 1,700,000 | $ | 13,004,601 |
NOTE 5—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $252.
22 Invesco Emerging Markets Flexible Bond Fund
NOTE 6—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 7—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Consolidated Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 8—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund had a capital loss carryforward as of October 31, 2017, as follows:
Capital Loss Carryforward* | ||||||||||||
Expiration | Short-Term | Long-Term | Total | |||||||||
Not subject to expiration | $ | — | $ | 1,713,795 | $ | 1,713,795 |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
NOTE 9—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $68,576,932 and $73,239,390, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 1,822,406 | ||
Aggregate unrealized (depreciation) of investments | (2,798,341 | ) | ||
Net unrealized appreciation (depreciation) of investments | $ | (975,935 | ) |
Cost of investments for tax purposes is $46,951,959.
23 Invesco Emerging Markets Flexible Bond Fund
NOTE 10—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 118,092 | $ | 781,929 | 231,935 | $ | 1,537,198 | ||||||||||
Class B(b) | — | — | 4,146 | 27,896 | ||||||||||||
Class C | 79,454 | 531,730 | 57,250 | 378,197 | ||||||||||||
Class R | 1,609 | 10,691 | 5,432 | 35,646 | ||||||||||||
Class Y | 77,729 | 515,869 | 319,698 | 2,114,044 | ||||||||||||
Class R6 | 261,654 | 1,736,507 | 2,029 | 13,232 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 12,011 | 78,797 | 19,843 | 130,341 | ||||||||||||
Class B(b) | 42 | 280 | 320 | 2,095 | ||||||||||||
Class C | 2,125 | 13,958 | 4,072 | 26,779 | ||||||||||||
Class R | 525 | 3,456 | 1,353 | 8,886 | ||||||||||||
Class Y | 3,870 | 25,340 | 4,509 | 29,792 | ||||||||||||
Class R6 | 154,566 | 1,012,176 | 329,038 | 2,155,646 | ||||||||||||
Conversion of Class B shares to Class A shares:(c) | ||||||||||||||||
Class A | 9,784 | 65,942 | 8,303 | 54,831 | ||||||||||||
Class B | (9,790 | ) | (65,942 | ) | (8,306 | ) | (54,831 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (210,275 | ) | (1,392,086 | ) | (332,849 | ) | (2,189,494 | ) | ||||||||
Class B(b) | (420 | ) | (2,805 | ) | (4,555 | ) | (29,445 | ) | ||||||||
Class C | (68,037 | ) | (449,368 | ) | (62,177 | ) | (408,978 | ) | ||||||||
Class R | (26,879 | ) | (179,699 | ) | (5,144 | ) | (33,353 | ) | ||||||||
Class Y | (34,222 | ) | (226,958 | ) | (83,659 | ) | (550,193 | ) | ||||||||
Class R6(d) | (2,431,329 | ) | (15,630,203 | ) | (2,245,209 | ) | (14,863,282 | ) | ||||||||
Net increase (decrease) in share activity | (2,059,491 | ) | $ | (13,170,386 | ) | (1,753,971 | ) | $ | (11,614,993 | ) |
(a) | 82% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser. |
(b) | Class B shares activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(c) | Effective as of the close of business January 26, 2018, all outstanding Class B shares were converted to Class A shares. |
(d) | On May 1, 2017, 1,545,008 Class R6 shares valued at $10,243,403 were redeemed by affiliated mutual funds. |
24 Invesco Emerging Markets Flexible Bond Fund
NOTE 11—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Return of capital | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 6.71 | $ | 0.15 | $ | (0.33 | ) | $ | (0.18 | ) | $ | (0.13 | ) | $ | — | $ | (0.13 | ) | $ | 6.40 | (2.74 | )% | $ | 4,160 | 1.23 | %(d) | 1.91 | %(d) | 4.63 | %(d) | 136 | % | ||||||||||||||||||||||||
Year ended 10/31/17 | 6.53 | 0.35 | 0.07 | 0.42 | (0.24 | ) | — | (0.24 | ) | 6.71 | 6.62 | 4,832 | 1.23 | 1.91 | 5.25 | 245 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.77 | 0.27 | (0.25 | ) | 0.02 | — | (0.26 | ) | (0.26 | ) | 6.53 | 0.45 | 5,182 | 1.23 | 1.91 | 4.16 | 266 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 8.49 | 0.41 | (1.76 | ) | (1.35 | ) | — | (0.37 | ) | (0.37 | ) | 6.77 | (16.20 | ) | 6,282 | 1.24 | 1.89 | 5.46 | 50 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.17 | 0.46 | (0.77 | ) | (0.31 | ) | (0.06 | ) | (0.31 | ) | (0.37 | ) | 8.49 | (3.44 | ) | 9,379 | 1.24 | 1.84 | 5.29 | 69 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 9.88 | 0.48 | (0.79 | ) | (0.31 | ) | (0.29 | ) | (0.11 | ) | (0.40 | ) | 9.17 | (3.25 | ) | 12,998 | 1.24 | 1.77 | 4.96 | 31 | ||||||||||||||||||||||||||||||||||||
Class B | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18(e) | 6.71 | 0.06 | 0.02 | 0.08 | (0.05 | ) | — | (0.05 | ) | 6.74 | 1.23 | — | 1.98 | (d) | 2.66 | (d) | 3.88 | (d) | 136 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.53 | 0.30 | 0.07 | 0.37 | (0.19 | ) | — | (0.19 | ) | 6.71 | 5.82 | 68 | 1.98 | 2.66 | 4.50 | 245 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.77 | 0.22 | (0.25 | ) | (0.03 | ) | — | (0.21 | ) | (0.21 | ) | 6.53 | (0.37 | ) | 121 | 1.98 | 2.66 | 3.41 | 266 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 8.48 | 0.35 | (1.75 | ) | (1.40 | ) | — | (0.31 | ) | (0.31 | ) | 6.77 | (16.72 | ) | 296 | 1.99 | 2.64 | 4.71 | 50 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.16 | 0.40 | (0.78 | ) | (0.38 | ) | (0.05 | ) | (0.25 | ) | (0.30 | ) | 8.48 | (4.17 | ) | 349 | 1.99 | 2.59 | 4.54 | 69 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 9.87 | 0.41 | (0.79 | ) | (0.38 | ) | (0.22 | ) | (0.11 | ) | (0.33 | ) | 9.16 | (3.98 | ) | 570 | 1.99 | 2.52 | 4.21 | 31 | ||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 6.71 | 0.13 | (0.34 | ) | (0.21 | ) | (0.10 | ) | — | (0.10 | ) | 6.40 | (3.11 | ) | 1,252 | 1.98 | (d) | 2.66 | (d) | 3.88 | (d) | 136 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.54 | 0.30 | 0.06 | 0.36 | (0.19 | ) | — | (0.19 | ) | 6.71 | 5.66 | 1,221 | 1.98 | 2.66 | 4.50 | 245 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.77 | 0.22 | (0.24 | ) | (0.02 | ) | — | (0.21 | ) | (0.21 | ) | 6.54 | (0.21 | ) | 1,195 | 1.98 | 2.66 | 3.41 | 266 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 8.49 | 0.35 | (1.75 | ) | (1.40 | ) | — | (0.32 | ) | (0.32 | ) | 6.77 | (16.82 | ) | 1,385 | 1.99 | 2.64 | 4.71 | 50 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.17 | 0.40 | (0.78 | ) | (0.38 | ) | (0.05 | ) | (0.25 | ) | (0.30 | ) | 8.49 | (4.16 | ) | 2,244 | 1.99 | 2.59 | 4.54 | 69 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 9.88 | 0.41 | (0.79 | ) | (0.38 | ) | (0.22 | ) | (0.11 | ) | (0.33 | ) | 9.17 | (3.97 | ) | 3,532 | 1.99 | 2.52 | 4.21 | 31 | ||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 6.70 | 0.14 | (0.32 | ) | (0.18 | ) | (0.12 | ) | — | (0.12 | ) | 6.40 | (2.72 | ) | 111 | 1.48 | (d) | 2.16 | (d) | 4.38 | (d) | 136 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.53 | 0.33 | 0.07 | 0.40 | (0.23 | ) | — | (0.23 | ) | 6.70 | 6.20 | 283 | 1.48 | 2.16 | 5.00 | 245 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.76 | 0.25 | (0.24 | ) | 0.01 | — | (0.24 | ) | (0.24 | ) | 6.53 | 0.33 | 264 | 1.48 | 2.16 | 3.91 | 266 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 8.48 | 0.39 | (1.76 | ) | (1.37 | ) | — | (0.35 | ) | (0.35 | ) | 6.76 | (16.43 | ) | 363 | 1.49 | 2.14 | 5.21 | 50 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.17 | 0.44 | (0.78 | ) | (0.34 | ) | (0.06 | ) | (0.29 | ) | (0.35 | ) | 8.48 | (3.79 | ) | 460 | 1.49 | 2.09 | 5.04 | 69 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 9.87 | 0.46 | (0.78 | ) | (0.32 | ) | (0.27 | ) | (0.11 | ) | (0.38 | ) | 9.17 | (3.39 | ) | 776 | 1.49 | 2.02 | 4.71 | 31 | ||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 6.71 | 0.16 | (0.33 | ) | (0.17 | ) | (0.14 | ) | — | (0.14 | ) | 6.40 | (2.62 | ) | 2,190 | 0.98 | (d) | 1.66 | (d) | 4.88 | (d) | 136 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.53 | 0.36 | 0.08 | 0.44 | (0.26 | ) | — | (0.26 | ) | 6.71 | 6.89 | 1,977 | 0.98 | 1.66 | 5.50 | 245 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.77 | 0.29 | (0.25 | ) | 0.04 | — | (0.28 | ) | (0.28 | ) | 6.53 | 0.72 | 354 | 0.98 | 1.66 | 4.41 | 266 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 8.49 | 0.45 | (1.78 | ) | (1.33 | ) | — | (0.39 | ) | (0.39 | ) | 6.77 | (15.99 | ) | 304 | 0.99 | 1.64 | 5.71 | 50 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.17 | 0.49 | (0.78 | ) | (0.29 | ) | (0.06 | ) | (0.33 | ) | (0.39 | ) | 8.49 | (3.20 | ) | 2,911 | 0.99 | 1.59 | 5.54 | 69 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 9.88 | 0.51 | (0.79 | ) | (0.28 | ) | (0.32 | ) | (0.11 | ) | (0.43 | ) | 9.17 | (3.01 | ) | 1,529 | 0.99 | 1.52 | 5.21 | 31 | ||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 6.71 | 0.16 | (0.33 | ) | (0.17 | ) | (0.14 | ) | — | (0.14 | ) | 6.40 | (2.62 | ) | 7 | 0.98 | (d) | 1.36 | (d) | 4.88 | (d) | 136 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.53 | 0.36 | 0.08 | 0.44 | (0.26 | ) | — | (0.26 | ) | 6.71 | 6.89 | 7 | 0.98 | 1.31 | 5.50 | 245 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.77 | 0.29 | (0.25 | ) | 0.04 | — | (0.28 | ) | (0.28 | ) | 6.53 | 0.72 | 7 | 0.98 | 1.28 | 4.41 | 266 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 8.48 | 0.45 | (1.77 | ) | (1.32 | ) | — | (0.39 | ) | (0.39 | ) | 6.77 | (15.89 | ) | 7 | 0.99 | 1.34 | 5.71 | 50 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.16 | 0.49 | (0.78 | ) | (0.29 | ) | (0.06 | ) | (0.33 | ) | (0.39 | ) | 8.48 | (3.20 | ) | 186 | 0.99 | 1.31 | 5.54 | 69 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 9.87 | 0.51 | (0.79 | ) | (0.28 | ) | (0.32 | ) | (0.11 | ) | (0.43 | ) | 9.16 | (3.01 | ) | 291 | 0.99 | 1.36 | 5.21 | 31 | ||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 6.70 | 0.16 | (0.33 | ) | (0.17 | ) | (0.14 | ) | — | (0.14 | ) | 6.39 | (2.63 | ) | 34,333 | 0.98 | (d) | 1.36 | (d) | 4.88 | (d) | 136 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 6.53 | 0.36 | 0.07 | 0.43 | (0.26 | ) | — | (0.26 | ) | 6.70 | 6.73 | 49,498 | 0.98 | 1.31 | 5.50 | 245 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 6.77 | 0.29 | (0.25 | ) | 0.04 | — | (0.28 | ) | (0.28 | ) | 6.53 | 0.73 | 60,702 | 0.98 | 1.28 | 4.41 | 266 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 8.48 | 0.43 | (1.75 | ) | (1.32 | ) | — | (0.39 | ) | (0.39 | ) | 6.77 | (15.89 | ) | 37,373 | 0.99 | 1.33 | 5.71 | 50 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 9.16 | 0.49 | (0.78 | ) | (0.29 | ) | (0.06 | ) | (0.33 | ) | (0.39 | ) | 8.48 | (3.21 | ) | 39,617 | 0.99 | 1.30 | 5.54 | 69 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 9.87 | 0.50 | (0.78 | ) | (0.28 | ) | (0.32 | ) | (0.11 | ) | (0.43 | ) | 9.16 | (3.01 | ) | 33,125 | 0.99 | 1.29 | 5.21 | 31 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $4,606, $65, $1,413, $206, $2,067, $7 and $49,300 for Class A, Class B, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
25 Invesco Emerging Markets Flexible Bond Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 972.60 | $ | 6.02 | $ | 1,018.70 | $ | 6.16 | 1.23 | % | ||||||||||||
C | 1,000.00 | 970.40 | 9.67 | 1,014.98 | 9.89 | 1.98 | ||||||||||||||||||
R | 1,000.00 | 972.80 | 7.24 | 1,017.46 | 7.40 | 1.48 | ||||||||||||||||||
Y | 1,000.00 | 973.80 | 4.80 | 1,019.93 | 4.91 | 0.98 | ||||||||||||||||||
R5 | 1,000.00 | 973.80 | 4.80 | 1,019.93 | 4.91 | 0.98 | ||||||||||||||||||
R6 | 1,000.00 | 975.30 | 4.80 | 1,019.93 | 4.91 | 0.98 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
26 Invesco Emerging Markets Flexible Bond Fund
Distribution Information
Correction notice
The following table sets forth on a per share basis the distribution that was paid in December 2017. Included in the table is a written statement of the sources of the distribution on a generally accepted accounting principles (“GAAP”) basis.
Net Income | Gain from Sale of Securities | Return of Principal | Total Distribution | |||||||||||||||
12/13/2017 | Class A | $ | 0.0535 | $ | 0.000 | $ | 0.0107 | $ | 0.0642 | |||||||||
12/13/2017 | Class B | $ | 0.0408 | $ | 0.000 | $ | 0.0107 | $ | 0.0515 | |||||||||
12/13/2017 | Class C | $ | 0.0409 | $ | 0.000 | $ | 0.0107 | $ | 0.0516 | |||||||||
12/13/2017 | Class R | $ | 0.0492 | $ | 0.000 | $ | 0.0107 | $ | 0.0599 | |||||||||
12/13/2017 | Class Y | $ | 0.0577 | $ | 0.000 | $ | 0.0107 | $ | 0.0684 | |||||||||
12/13/2017 | Class R5 | $ | 0.0577 | $ | 0.000 | $ | 0.0107 | $ | 0.0684 | |||||||||
12/13/2017 | Class R6 | $ | 0.0576 | $ | 0.000 | $ | 0.0107 | $ | 0.0683 |
Please note that the information in the preceding chart is for financial accounting purposes only. Shareholders should be aware that the tax treatment of distributions likely differs from GAAP treatment. Form 1099-DIV for the calendar year will report distributions for U.S. federal income tax purposes. This Notice is sent to comply with certain U.S. Securities and Exchange Commission requirements.
27 Invesco Emerging Markets Flexible Bond Fund
Explore High-Conviction Investing with Invesco
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Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
∎ Quarterly statements
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∎ Tax forms
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. | ||
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. EMFB-SAR-1 06152018 0827 |
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco Endeavor Fund
| ||||
Nasdaq: | ||||
A: ATDAX ∎ C: ATDCX ∎ R: ATDRX ∎ Y: ATDYX ∎ R5: ATDIX ∎ R6: ATDFX |
| ||||
2
| Fund Performance
| |||
4
| Letters to Shareholders
| |||
5
| Schedule of Investments
| |||
7
| Financial Statements
| |||
9
| Notes to Financial Statements
| |||
15
| Financial Highlights
| |||
16
| Fund Expenses
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
|
Class A Shares | 0.81 | % | ||
Class C Shares | 0.45 | |||
Class R Shares | 0.68 | |||
Class Y Shares | 0.93 | |||
Class R5 Shares | 1.00 | |||
Class R6 Shares | 1.04 | |||
S&P 500 Index▼ (Broad Market Index) | 3.82 | |||
Russell Midcap Index▼ (Style-Specific Index) | 3.69 | |||
Lipper Mid-Cap Core Funds Index∎ (Peer Group Index) | 2.92 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
|
The S&P 500® Index is an unmanaged index considered representative of the US stock market.
The Russell Midcap® Index is an unmanaged index considered representative of mid-cap stocks. The Russell Midcap Index is a trademark/service mark of the Frank Russell Co. Russell® is a trademark of the Frank Russell Co.
The Lipper Mid-Cap Core Funds Index is an unmanaged index considered representative of mid-cap core funds tracked by Lipper.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Endeavor Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
| ||||||
Class A Shares |
| |||||
Inception (11/4/03) | 9.15 | % | ||||
10 Years | 8.84 | |||||
5 Years | 6.96 | |||||
1 Year | 3.18 | |||||
Class C Shares |
| |||||
Inception (11/4/03) | 8.78 | % | ||||
10 Years | 8.65 | |||||
5 Years | 7.37 | |||||
1 Year | 7.40 | |||||
Class R Shares |
| |||||
Inception (4/30/04) | 9.00 | % | ||||
10 Years | 9.20 | |||||
5 Years | 7.90 | |||||
1 Year | 8.90 | |||||
Class Y Shares |
| |||||
10 Years | 9.73 | % | ||||
5 Years | 8.44 | |||||
1 Year | 9.45 | |||||
Class R5 Shares |
| |||||
Inception (4/30/04) | 9.77 | % | ||||
10 Years | 9.97 | |||||
5 Years | 8.57 | |||||
1 Year | 9.60 | |||||
Class R6 Shares |
| |||||
10 Years | 9.75 | % | ||||
5 Years | 8.67 | |||||
1 Year | 9.71 |
Class Y shares incepted on October 3, 2008. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (11/4/03) | 9.24 | % | ||||
10 Years | 9.15 | |||||
5 Years | 7.06 | |||||
1 Year | 4.46 | |||||
Class C Shares |
| |||||
Inception (11/4/03) | 8.88 | % | ||||
10 Years | 8.96 | |||||
5 Years | 7.47 | |||||
1 Year | 8.73 | |||||
Class R Shares |
| |||||
Inception (4/30/04) | 9.10 | % | ||||
10 Years | 9.51 | |||||
5 Years | 8.00 | |||||
1 Year | 10.24 | |||||
Class Y Shares |
| |||||
10 Years | 10.04 | % | ||||
5 Years | 8.54 | |||||
1 Year | 10.83 | |||||
Class R5 Shares |
| |||||
Inception (4/30/04) | 9.86 | % | ||||
10 Years | 10.28 | |||||
5 Years | 8.67 | |||||
1 Year | 10.93 | |||||
Class R6 Shares |
| |||||
10 Years | 10.05 | % | ||||
5 Years | 8.77 | |||||
1 Year | 10.99 |
Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.37%, 2.12%, 1.62%, 1.12%, 0.99% and 0.91%, respectively.1 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.39%, 2.14%, 1.64%, 1.14%, 1.01% and 0.93%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco Endeavor Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Endeavor Fund
Schedule of Investments(a)
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–85.63% |
| |||||||
Agricultural & Farm Machinery–2.39% | ||||||||
Deere & Co. | 41,065 | $ | 5,557,326 | |||||
Air Freight & Logistics–2.66% | ||||||||
Echo Global Logistics, Inc.(b) | 226,792 | 6,191,422 | ||||||
Airlines–6.05% | ||||||||
Ryanair Holdings PLC–ADR (Ireland)(b) | 60,813 | 6,687,606 | ||||||
Spirit Airlines Inc.(b) | 207,235 | 7,402,434 | ||||||
14,090,040 | ||||||||
Apparel Retail–3.44% | ||||||||
Ross Stores, Inc. | 99,076 | 8,010,295 | ||||||
Asset Management & Custody Banks–6.58% | ||||||||
Affiliated Managers Group, Inc. | 43,687 | 7,202,239 | ||||||
Oaktree Capital Group LLC | 205,449 | 8,115,235 | ||||||
15,317,474 | ||||||||
Automotive Retail–5.83% | ||||||||
AutoZone, Inc.(b) | 9,082 | 5,671,891 | ||||||
CarMax, Inc.(b) | 126,486 | 7,905,375 | ||||||
13,577,266 | ||||||||
Communications Equipment–1.00% | ||||||||
Plantronics, Inc. | 35,727 | 2,327,614 | ||||||
Construction & Engineering–1.87% | ||||||||
Orion Group Holdings, Inc.(b) | 719,419 | 4,359,679 | ||||||
Consumer Finance–3.65% | ||||||||
Encore Capital Group, Inc.(b) | 190,343 | 8,489,298 | ||||||
Data Processing & Outsourced Services–2.11% | ||||||||
Alliance Data Systems Corp. | 24,247 | 4,923,353 | ||||||
Diversified Banks–2.32% | ||||||||
Bank of America Corp. | 180,747 | 5,407,950 | ||||||
Environmental & Facilities Services–2.57% | ||||||||
Stericycle, Inc.(b) | 102,090 | 5,993,704 | ||||||
Health Care Distributors–4.06% | ||||||||
McKesson Corp. | 60,513 | 9,452,736 | ||||||
Health Care Equipment–3.30% | ||||||||
Zimmer Biomet Holdings, Inc. | 66,803 | 7,693,701 | ||||||
Industrial Conglomerates–2.10% | ||||||||
DCC PLC (United Kingdom) | 50,956 | 4,901,143 | ||||||
Integrated Oil & Gas–1.87% | ||||||||
Cenovus Energy Inc. (Canada) | 433,667 | 4,344,440 | ||||||
IT Consulting & Other Services–4.21% | ||||||||
Cognizant Technology Solutions Corp.–Class A | 119,977 | 9,816,518 |
Shares | Value | |||||||
Life & Health Insurance–1.99% | ||||||||
Unum Group | 95,729 | $ | 4,631,369 | |||||
Managed Health Care–4.63% | ||||||||
UnitedHealth Group Inc. | 45,660 | 10,794,024 | ||||||
Multi-Line Insurance–2.04% | ||||||||
Vienna Insurance Group AG Wiener Versicherung Gruppe (Austria) | 146,205 | 4,749,010 | ||||||
Oil & Gas Exploration & Production–2.64% | ||||||||
Devon Energy Corp. | 169,120 | 6,144,130 | ||||||
Real Estate Operating Companies–5.68% | ||||||||
Brookfield Property Partners L.P. | 683,918 | 13,220,135 | ||||||
Research & Consulting Services–2.62% | ||||||||
Nielsen Holdings PLC | 193,755 | 6,093,595 | ||||||
Specialty Chemicals–2.43% | ||||||||
Axalta Coating Systems Ltd.(b) | 183,319 | 5,664,557 | ||||||
Systems Software–3.61% | ||||||||
Check Point Software Technologies Ltd. (Israel)(b) | 87,038 | 8,400,037 | ||||||
Trading Companies & Distributors–3.98% | ||||||||
Grafton Group PLC (United Kingdom)(c) | 304,859 | 3,151,473 | ||||||
Titan Machinery, Inc.(b) | 317,106 | 6,126,488 | ||||||
9,277,961 | ||||||||
Total Common Stocks & Other Equity Interests |
| 199,428,777 | ||||||
Money Market Funds–14.41% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(d) | 11,744,513 | 11,744,513 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(d) | 8,386,768 | 8,387,606 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(d) | 13,422,300 | 13,422,300 | ||||||
Total Money Market Funds |
| 33,554,419 | ||||||
TOTAL INVESTMENTS IN SECURITIES–100.04% |
| 232,983,196 | ||||||
OTHER ASSETS LESS LIABILITIES–(0.04)% |
| (91,426 | ) | |||||
NET ASSETS–100.00% |
| $ | 232,891,770 |
Investment Abbreviations:
ADR | – American Depositary Receipt |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Endeavor Fund
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | Each unit represents one ordinary share, seventeen Class A shares and one Class C share. |
(d) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
Portfolio Composition
By sector, based on Net Assets as of April 30, 2018
Industrials | 24.2 | % | ||
Financials | 16.6 | |||
Health Care | 12.0 | |||
Information Technology | 10.9 | |||
Consumer Discretionary | 9.3 | |||
Real Estate | 5.7 | |||
Energy | 4.5 | |||
Materials | 2.4 | |||
Money Market Funds Plus Other Assets Less Liabilities | 14.4 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Endeavor Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $153,382,369) | $ | 199,428,777 | ||
Investments in affiliated money market funds, at value (Cost $33,554,840) | 33,554,419 | |||
Foreign currencies, at value (Cost $192) | 200 | |||
Receivable for: | ||||
Fund shares sold | 150,689 | |||
Dividends | 133,893 | |||
Investment for trustee deferred compensation and retirement plans | 71,407 | |||
Other assets | 44,282 | |||
Total assets | 233,383,667 | |||
Liabilities: |
| |||
Payable for: | ||||
Fund shares reacquired | 191,693 | |||
Accrued fees to affiliates | 163,907 | |||
Accrued trustees’ and officers’ fees and benefits | 2,154 | |||
Accrued other operating expenses | 54,024 | |||
Trustee deferred compensation and retirement plans | 80,119 | |||
Total liabilities | 491,897 | |||
Net assets applicable to shares outstanding | $ | 232,891,770 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 185,655,038 | ||
Undistributed net investment income (loss) | (275,368 | ) | ||
Undistributed net realized gain | 1,463,161 | |||
Net unrealized appreciation | 46,048,939 | |||
$ | 232,891,770 |
Net Assets: |
| |||
Class A | $ | 131,193,467 | ||
Class C | $ | 28,549,728 | ||
Class R | $ | 12,128,547 | ||
Class Y | $ | 37,161,323 | ||
Class R5 | $ | 21,128,765 | ||
Class R6 | $ | 2,729,940 | ||
Shares outstanding, no par value, |
| |||
Class A | 6,749,148 | |||
Class C | 1,702,551 | |||
Class R | 650,692 | |||
Class Y | 1,852,793 | |||
Class R5 | 1,021,749 | |||
Class R6 | 131,277 | |||
Class A: | ||||
Net asset value per share | $ | 19.44 | ||
Maximum offering price per share | ||||
(Net asset value of $19.44 ¸ 94.50%) | $ | 20.57 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 16.77 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 18.64 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 20.06 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 20.68 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 20.80 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Endeavor Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of foreign withholding taxes of $5,044) | $ | 1,250,070 | ||
Dividends from affiliated money market funds | 276,723 | |||
Total investment income | 1,526,793 | |||
Expenses: | ||||
Advisory fees | 907,344 | |||
Administrative services fees | 42,426 | |||
Custodian fees | 6,703 | |||
Distribution fees: | ||||
Class A | 170,625 | |||
Class B | 1,399 | |||
Class C | 153,357 | |||
Class R | 33,637 | |||
Transfer agent fees — A, B, C, R and Y | 226,700 | |||
Transfer agent fees — R5 | 11,027 | |||
Transfer agent fees — R6 | 267 | |||
Trustees’ and officers’ fees and benefits | 12,515 | |||
Registration and filing fees | 51,283 | |||
Reports to shareholders | 20,605 | |||
Professional services fees | 35,540 | |||
Other | 10,984 | |||
Total expenses | 1,684,412 | |||
Less: Fees waived and expense offset arrangement(s) | (28,490 | ) | ||
Net expenses | 1,655,922 | |||
Net investment income (loss) | (129,129 | ) | ||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | 2,913,395 | |||
Foreign currencies | (19,291 | ) | ||
2,894,104 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | (569,154 | ) | ||
Foreign currencies | 1,446 | |||
(567,708 | ) | |||
Net realized and unrealized gain | 2,326,396 | |||
Net increase in net assets resulting from operations | $ | 2,197,267 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Endeavor Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income (loss) | $ | (129,129 | ) | $ | (361,707 | ) | ||
Net realized gain | 2,894,104 | 26,040,264 | ||||||
Change in net unrealized appreciation (depreciation) | (567,708 | ) | 37,845,677 | |||||
Net increase in net assets resulting from operations | 2,197,267 | 63,524,234 | ||||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | (3,714,684 | ) | (12,424,004 | ) | ||||
Class B | (17,894 | ) | (112,920 | ) | ||||
Class C | (970,910 | ) | (3,915,415 | ) | ||||
Class R | (405,139 | ) | (1,786,325 | ) | ||||
Class Y | (998,008 | ) | (2,904,478 | ) | ||||
Class R5 | (569,252 | ) | (2,170,163 | ) | ||||
Class R6 | (53,908 | ) | (4,593,195 | ) | ||||
Total distributions from net realized gains | (6,729,795 | ) | (27,906,500 | ) | ||||
Share transactions–net: | ||||||||
Class A | 1,036,277 | (1,049,715 | ) | |||||
Class B | (662,373 | ) | (628,934 | ) | ||||
Class C | (2,236,727 | ) | (3,264,441 | ) | ||||
Class R | (2,071,394 | ) | (5,371,596 | ) | ||||
Class Y | 788,788 | 13,558,855 | ||||||
Class R5 | (707,384 | ) | (2,388,568 | ) | ||||
Class R6 | 750,179 | (52,762,339 | ) | |||||
Net increase (decrease) in net assets resulting from share transactions | (3,102,634 | ) | (51,906,738 | ) | ||||
Net increase (decrease) in net assets | (7,635,162 | ) | (16,289,004 | ) | ||||
Net assets: | ||||||||
Beginning of period | 240,526,932 | 256,815,936 | ||||||
End of period (includes undistributed net investment income (loss) of $(275,368) and $(146,239), respectively) | $ | 232,891,770 | $ | 240,526,932 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Endeavor Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Effective November 30, 2010, new or additional investments in Class B shares are no longer permitted. Existing shareholders of Class B shares were permitted to continue to reinvest dividends and capital gains distributions in Class B shares until their conversion to Class A shares. Also, shareholders in Class B shares were able to exchange those shares for Class B shares of other Invesco Funds offering such shares until they converted to Class A shares. Generally, Class B shares automatically converted to Class A shares on or about the month-end, which was at least eight years after the date of purchase. Redemptions of Class B shares prior to the conversion date were subject to a CDSC. Effective January 26, 2018, all of the Fund’s outstanding Class B shares were converted to Class A shares, in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
9 Invesco Endeavor Fund
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
10 Invesco Endeavor Fund
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
J. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the
11 Invesco Endeavor Fund
Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||||||
First $250 million | 0 | .745% | ||||||
Next $250 million | 0 | .73% | ||||||
Next $500 million | 0 | .715% | ||||||
Next $1.5 billion | 0 | .70% | ||||||
Next $2.5 billion | 0 | .685% | ||||||
Next $2.5 billion | 0 | .67% | ||||||
Next $2.5 billion | 0 | .655% | ||||||
Over $10 billion | 0 | .64% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.745%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.00%, 2.75%, 2.25%, 1.75%, 1.75% and 1.75%, respectively, of the Fund’s average daily net assets (the “expense limits”). Prior to their conversion to Class A shares, the expense limit for Class B shares was 2.75% of average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $25,311.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. Prior to their conversion to Class A shares, the Fund paid an annual rate of 1.00% of the average daily net assets of Class B shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $15,021 in front-end sales commissions from the sale of Class A shares and $95 and $892 from Class A and Class C shares, respectively, for CDSC imposed on redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
12 Invesco Endeavor Fund
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were transfers from Level 1 to Level 2 of $7,900,483, due to foreign fair value adjustments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Common Stocks & Other Equity Interests | $ | 186,627,151 | $ | 12,801,626 | $ | — | $ | 199,428,777 | ||||||||
Money Market Funds | 33,554,419 | — | — | 33,554,419 | ||||||||||||
Total Investments | $ | 220,181,570 | $ | 12,801,626 | $ | — | $ | 232,983,196 |
NOTE 4—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $3,179.
NOTE 5—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 7—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2017.
13 Invesco Endeavor Fund
NOTE 8—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $31,304,374 and $28,551,359, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 56,040,560 | ||
Aggregate unrealized (depreciation) of investments | (11,464,365 | ) | ||
Net unrealized appreciation of investments | $ | 44,576,195 |
Cost of investments for tax purposes is $188,407,001.
NOTE 9—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 710,923 | $ | 14,245,025 | 1,807,365 | $ | 34,503,121 | ||||||||||
Class B(b) | 225 | 4,018 | 6,048 | 102,352 | ||||||||||||
Class C | 72,988 | 1,274,677 | 530,870 | 8,932,756 | ||||||||||||
Class R | 68,966 | 1,332,482 | 245,467 | 4,520,273 | ||||||||||||
Class Y | 312,609 | 6,476,350 | 1,335,758 | 26,384,134 | ||||||||||||
Class R5 | 88,315 | 1,891,778 | 182,739 | 3,694,560 | ||||||||||||
Class R6 | 57,632 | 1,241,821 | 92,237 | 1,821,200 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 180,366 | 3,600,097 | 646,548 | 12,001,370 | ||||||||||||
Class B(b) | 1,018 | 17,563 | 6,665 | 108,737 | ||||||||||||
Class C | 53,635 | 926,282 | 230,746 | 3,755,445 | ||||||||||||
Class R | 21,115 | 404,560 | 99,570 | 1,782,309 | ||||||||||||
Class Y | 42,480 | 874,239 | 142,134 | 2,700,939 | ||||||||||||
Class R5 | 26,729 | 566,931 | 110,165 | 2,160,340 | ||||||||||||
Class R6 | 2,510 | 53,507 | 233,120 | 4,593,195 | ||||||||||||
Conversion of Class B shares to Class A shares:(c) | ||||||||||||||||
Class A | 29,185 | 617,254 | 28,063 | 538,538 | ||||||||||||
Class B | (33,929 | ) | (617,254 | ) | (32,635 | ) | (538,538 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (868,625 | ) | (17,426,099 | ) | (2,510,541 | ) | (48,092,744 | ) | ||||||||
Class B(b) | (3,851 | ) | (66,700 | ) | (17,410 | ) | (301,485 | ) | ||||||||
Class C | (255,805 | ) | (4,437,686 | ) | (951,649 | ) | (15,952,642 | ) | ||||||||
Class R | (198,275 | ) | (3,808,436 | ) | (637,158 | ) | (11,674,178 | ) | ||||||||
Class Y | (317,856 | ) | (6,561,801 | ) | (794,777 | ) | (15,526,218 | ) | ||||||||
Class R5 | (148,256 | ) | (3,166,093 | ) | (411,566 | ) | (8,243,468 | ) | ||||||||
Class R6(d) | (25,417 | ) | (545,149 | ) | (3,022,821 | ) | (59,176,734 | ) | ||||||||
Net increase (decrease) in share activity | (183,318 | ) | $ | (3,102,634 | ) | (2,681,062 | ) | $ | (51,906,738 | ) |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 37% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
(b) | Class B shares activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(c) | Effective as of the close of business January 26, 2018, all outstanding Class B shares were converted to Class A shares. |
(d) | On May 5, 2017, 2,459,627 Class R6 shares valued at $47,864,341 were redeemed by affiliated mutual funds. |
14 Invesco Endeavor Fund
NOTE 10—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 19.81 | $ | (0.01 | ) | $ | 0.18 | $ | 0.17 | $ | — | $ | (0.54 | ) | $ | (0.54 | ) | $ | 19.44 | 0.81 | % | $ | 131,193 | 1.33 | %(d) | 1.35 | %(d) | (0.08 | )%(d) | 14 | % | |||||||||||||||||||||||||
Year ended 10/31/17 | 17.19 | (0.03 | ) | 4.57 | 4.54 | — | (1.92 | ) | (1.92 | ) | 19.81 | 27.44 | 132,670 | 1.34 | 1.36 | (0.13 | ) | 19 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 19.30 | (0.02 | ) | 0.21 | 0.19 | — | (2.30 | ) | (2.30 | ) | 17.19 | 2.08 | 115,588 | 1.34 | 1.36 | (0.12 | ) | 28 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 22.57 | (0.01 | ) | (1.25 | ) | (1.26 | ) | — | (2.01 | ) | (2.01 | ) | 19.30 | (5.80 | ) | 147,504 | 1.26 | 1.29 | (0.04 | ) | 27 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 21.18 | (0.09 | ) | 2.35 | 2.26 | (0.01 | ) | (0.86 | ) | (0.87 | ) | 22.57 | 11.13 | 192,326 | 1.26 | 1.29 | (0.43 | ) | 27 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 18.19 | (0.00 | ) | 4.78 | 4.78 | (0.06 | ) | (1.73 | ) | (1.79 | ) | 21.18 | 28.78 | 180,568 | 1.26 | 1.30 | (0.02 | ) | 20 | |||||||||||||||||||||||||||||||||||||
Class B |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18(e) | 17.21 | (0.03 | ) | 1.63 | 1.60 | — | (0.54 | ) | (0.54 | ) | 18.27 | 9.50 | — | 2.08 | (d) | 2.10 | (d) | (0.83 | )(d) | 14 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 15.25 | (0.15 | ) | 4.03 | 3.88 | — | (1.92 | ) | (1.92 | ) | 17.21 | 26.54 | 629 | 2.09 | 2.11 | (0.88 | ) | 19 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 17.52 | (0.13 | ) | 0.16 | 0.03 | — | (2.30 | ) | (2.30 | ) | 15.25 | 1.28 | 1,127 | 2.09 | 2.11 | (0.87 | ) | 28 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 20.82 | (0.15 | ) | (1.14 | ) | (1.29 | ) | — | (2.01 | ) | (2.01 | ) | 17.52 | (6.50 | ) | 2,161 | 2.01 | 2.04 | (0.79 | ) | 27 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 19.74 | (0.24 | ) | 2.18 | 1.94 | — | (0.86 | ) | (0.86 | ) | 20.82 | 10.27 | 4,855 | 2.01 | 2.04 | (1.18 | ) | 27 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 17.16 | (0.14 | ) | 4.49 | 4.35 | (0.04 | ) | (1.73 | ) | (1.77 | ) | 19.74 | 27.89 | 5,921 | 2.01 | 2.05 | (0.77 | ) | 20 | |||||||||||||||||||||||||||||||||||||
Class C |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 17.22 | (0.07 | ) | 0.16 | 0.09 | — | (0.54 | ) | (0.54 | ) | 16.77 | 0.45 | 28,550 | 2.08 | (d) | 2.10 | (d) | (0.83 | )(d) | 14 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 15.26 | (0.15 | ) | 4.03 | 3.88 | — | (1.92 | ) | (1.92 | ) | 17.22 | 26.52 | 31,548 | 2.09 | 2.11 | (0.88 | ) | 19 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 17.53 | (0.13 | ) | 0.16 | 0.03 | — | (2.30 | ) | (2.30 | ) | 15.26 | 1.27 | 30,857 | 2.09 | 2.11 | (0.87 | ) | 28 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 20.83 | (0.15 | ) | (1.14 | ) | (1.29 | ) | — | (2.01 | ) | (2.01 | ) | 17.53 | (6.49 | ) | 42,965 | 2.01 | 2.04 | (0.79 | ) | 27 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 19.75 | (0.24 | ) | 2.18 | 1.94 | — | (0.86 | ) | (0.86 | ) | 20.83 | 10.27 | 53,542 | 2.01 | 2.04 | (1.18 | ) | 27 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 17.17 | (0.14 | ) | 4.49 | 4.35 | (0.04 | ) | (1.73 | ) | (1.77 | ) | 19.75 | 27.87 | 49,344 | 2.01 | 2.05 | (0.77 | ) | 20 | |||||||||||||||||||||||||||||||||||||
Class R |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 19.04 | (0.03 | ) | 0.17 | 0.14 | — | (0.54 | ) | (0.54 | ) | 18.64 | 0.68 | 12,129 | 1.58 | (d) | 1.60 | (d) | (0.33 | )(d) | 14 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 16.62 | (0.07 | ) | 4.41 | 4.34 | — | (1.92 | ) | (1.92 | ) | 19.04 | 27.16 | 14,449 | 1.59 | 1.61 | (0.38 | ) | 19 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 18.78 | (0.06 | ) | 0.20 | 0.14 | — | (2.30 | ) | (2.30 | ) | 16.62 | 1.83 | 17,469 | 1.59 | 1.61 | (0.37 | ) | 28 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 22.08 | (0.06 | ) | (1.23 | ) | (1.29 | ) | — | (2.01 | ) | (2.01 | ) | 18.78 | (6.09 | ) | 24,855 | 1.51 | 1.54 | (0.29 | ) | 27 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 20.77 | (0.14 | ) | 2.31 | 2.17 | — | (0.86 | ) | (0.86 | ) | 22.08 | 10.89 | 34,634 | 1.51 | 1.54 | (0.68 | ) | 27 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 17.91 | (0.05 | ) | 4.69 | 4.64 | (0.05 | ) | (1.73 | ) | (1.78 | ) | 20.77 | 28.43 | 34,556 | 1.51 | 1.55 | (0.27 | ) | 20 | |||||||||||||||||||||||||||||||||||||
Class Y |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 20.40 | 0.02 | 0.18 | 0.20 | — | (0.54 | ) | (0.54 | ) | 20.06 | 0.93 | 37,161 | 1.08 | (d) | 1.10 | (d) | 0.17 | (d) | 14 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 17.61 | 0.02 | 4.69 | 4.71 | — | (1.92 | ) | (1.92 | ) | 20.40 | 27.77 | 37,034 | 1.09 | 1.11 | 0.12 | 19 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 19.66 | 0.02 | 0.23 | 0.25 | — | (2.30 | ) | (2.30 | ) | 17.61 | 2.37 | 19,938 | 1.09 | 1.11 | 0.13 | 28 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 22.91 | 0.04 | (1.28 | ) | (1.24 | ) | — | (2.01 | ) | (2.01 | ) | 19.66 | (5.61 | ) | 40,425 | 1.01 | 1.04 | 0.21 | 27 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 21.48 | (0.04 | ) | 2.38 | 2.34 | (0.05 | ) | (0.86 | ) | (0.91 | ) | 22.91 | 11.39 | 71,898 | 1.01 | 1.04 | (0.18 | ) | 27 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 18.38 | 0.05 | 4.84 | 4.89 | (0.06 | ) | (1.73 | ) | (1.79 | ) | 21.48 | 29.15 | 92,483 | 1.01 | 1.05 | 0.23 | 20 | |||||||||||||||||||||||||||||||||||||||
Class R5 |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 21.00 | 0.03 | 0.19 | 0.22 | — | (0.54 | ) | (0.54 | ) | 20.68 | 1.00 | 21,129 | 0.97 | (d) | 0.99 | (d) | 0.28 | (d) | 14 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.06 | 0.05 | 4.81 | 4.86 | — | (1.92 | ) | (1.92 | ) | 21.00 | 27.92 | 22,158 | 0.96 | 0.98 | 0.25 | 19 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.08 | 0.05 | 0.23 | 0.28 | — | (2.30 | ) | (2.30 | ) | 18.06 | 2.49 | 21,192 | 0.94 | 0.96 | 0.28 | 28 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 23.32 | 0.07 | (1.30 | ) | (1.23 | ) | — | (2.01 | ) | (2.01 | ) | 20.08 | (5.46 | ) | 33,854 | 0.89 | 0.92 | 0.33 | 27 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 21.84 | (0.02 | ) | 2.43 | 2.41 | (0.07 | ) | (0.86 | ) | (0.93 | ) | 23.32 | 11.51 | 49,356 | 0.90 | 0.93 | (0.07 | ) | 27 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 18.65 | 0.07 | 4.92 | 4.99 | (0.07 | ) | (1.73 | ) | (1.80 | ) | 21.84 | 29.24 | 31,593 | 0.91 | 0.95 | 0.33 | 20 | |||||||||||||||||||||||||||||||||||||||
Class R6 |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 21.11 | 0.04 | 0.19 | 0.23 | — | (0.54 | ) | (0.54 | ) | 20.80 | 1.04 | 2,730 | 0.89 | (d) | 0.91 | (d) | 0.36 | (d) | 14 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 18.13 | 0.07 | 4.83 | 4.90 | — | (1.92 | ) | (1.92 | ) | 21.11 | 28.04 | 2,038 | 0.88 | 0.90 | 0.33 | 19 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.13 | 0.06 | 0.24 | 0.30 | — | (2.30 | ) | (2.30 | ) | 18.13 | 2.59 | 50,645 | 0.85 | 0.87 | 0.37 | 28 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 23.35 | 0.09 | (1.30 | ) | (1.21 | ) | — | (2.01 | ) | (2.01 | ) | 20.13 | (5.36 | ) | 91,275 | 0.80 | 0.83 | 0.42 | 27 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 21.86 | 0.01 | 2.42 | 2.43 | (0.08 | ) | (0.86 | ) | (0.94 | ) | 23.35 | 11.62 | 100,410 | 0.81 | 0.84 | 0.02 | 27 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 18.65 | 0.08 | 4.93 | 5.01 | (0.07 | ) | (1.73 | ) | (1.80 | ) | 21.86 | 29.37 | 90,291 | 0.82 | 0.86 | 0.42 | 20 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $137,630, $588, $30,926, $13,566, $38,367, $22,236 and $2,504 for Class A, Class B, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
15 Invesco Endeavor Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 1,008.10 | $ | 6.62 | $ | 1,018.20 | $ | 6.66 | 1.33 | % | ||||||||||||
C | 1,000.00 | 1,004.50 | 10.34 | 1,014.48 | 10.39 | 2.08 | ||||||||||||||||||
R | 1,000.00 | 1,006.80 | 7.86 | 1,016.96 | 7.90 | 1.58 | ||||||||||||||||||
Y | 1,000.00 | 1,009.30 | 5.38 | 1,019.44 | 5.41 | 1.08 | ||||||||||||||||||
R5 | 1,000.00 | 1,010.00 | 4.83 | 1,019.98 | 4.86 | 0.97 | ||||||||||||||||||
R6 | 1,000.00 | 1,010.40 | 4.44 | 1,020.38 | 4.46 | 0.89 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
16 Invesco Endeavor Fund
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Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
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Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. END-SAR-1 06202018 1408
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Semiannual Report to Shareholders
| April 30, 2018 | |||
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Invesco Global Infrastructure Fund
| ||||
Nasdaq: | ||||
A: GIZAX ∎ C: GIZCX ∎ R: GIZRX ∎ Y: GIZYX ∎ R5: GIZFX ∎ R6: GIZSX |
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2
| Fund Performance
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4
| Letters to Shareholders
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5
| Schedule of Investments
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7
| Financial Statements
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9
| Notes to Financial Statements
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16
| Financial Highlights
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17
| Fund Expenses
| |||
18
| Distribution Information
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
| ||||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | -1.78 | % | ||
Class C Shares | -2.15 | |||
Class R Shares | -1.90 | |||
Class Y Shares | -1.66 | |||
Class R5 Shares | -1.66 | |||
Class R6 Shares | -1.66 | |||
MSCI World Index▼ (Broad Market Index) | 3.40 | |||
Dow Jones Brookfield Global Infrastructure Index▼ (Style-Specific Index) | -3.22 | |||
Lipper Global Infrastructure Funds Classification Average∎ (Peer Group) | -1.63 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
| |||
The MSCI World Index is an unmanaged index considered representative of stocks of developed countries. The index is computed using the net return, which withholds applicable taxes for non-resident investors. The Dow Jones Brookfield Global Infrastructure Index is designed to measure the stock performance of infrastructure companies domiciled globally and covers all sectors of the infrastructure market. The index is computed using the net return, which withholds applicable taxes for non-resident investors. The Lipper Global Infrastructure Funds Classification Average represents an average of all of the funds in the Lipper Global Infrastructure Funds classification. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
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For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Global Infrastructure Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
| ||||||
Class A Shares |
| |||||
Inception (5/2/14) | 1.52 | % | ||||
1 Year | -0.97 | |||||
Class C Shares |
| |||||
Inception (5/2/14) | 2.19 | % | ||||
1 Year | 3.00 | |||||
Class R Shares |
| |||||
Inception (5/2/14) | 2.69 | % | ||||
1 Year | 4.52 | |||||
Class Y Shares |
| |||||
Inception (5/2/14) | 3.20 | % | ||||
1 Year | 4.94 | |||||
Class R5 Shares |
| |||||
Inception (5/2/14) | 3.20 | % | ||||
1 Year | 4.94 | |||||
Class R6 Shares |
| |||||
Inception (5/2/14) | 3.20 | % | ||||
1 Year | 4.94 |
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.28%, 2.03%, 1.53%, 1.03%, 1.03% and 1.03%, respectively.1 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 2.87%, 3.62%, 3.12%, 2.62%, 2.54% and 2.54%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (5/2/14) | 1.19 | % | ||||
1 Year | -0.86 | |||||
Class C Shares |
| |||||
Inception (5/2/14) | 1.90 | % | ||||
1 Year | 3.10 | |||||
Class R Shares |
| |||||
Inception (5/2/14) | 2.41 | % | ||||
1 Year | 4.63 | |||||
Class Y Shares |
| |||||
Inception (5/2/14) | 2.91 | % | ||||
1 Year | 5.14 | |||||
Class R5 Shares |
| |||||
Inception (5/2/14) | 2.93 | % | ||||
1 Year | 5.14 | |||||
Class R6 Shares |
| |||||
Inception (5/2/14) | 2.91 | % | ||||
1 Year | 5.14 |
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 class shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least February 28, 2019. See current prospectus for more information. |
3 Invesco Global Infrastructure Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Global Infrastructure Fund
Schedule of Investments
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–98.87% |
| |||||||
Australia–5.03% | ||||||||
APA Group | 29,843 | $ | 187,051 | |||||
Macquarie Atlas Roads Group | 61,882 | 298,423 | ||||||
Transurban Group | 70,550 | 614,489 | ||||||
1,099,963 | ||||||||
Canada–13.36% | ||||||||
Enbridge Inc. | 31,345 | 949,604 | ||||||
Pembina Pipeline Corp. | 32,815 | 1,045,264 | ||||||
TransCanada Corp. | 21,831 | 925,824 | ||||||
2,920,692 | ||||||||
China–2.86% | ||||||||
Beijing Capital International Airport Co. | 106,000 | 144,492 | ||||||
China Merchants Port Holdings Co. Ltd. | 54,000 | 120,658 | ||||||
China Resources Gas Group Ltd. | 41,335 | 152,052 | ||||||
ENN Energy Holdings Ltd. | 10,000 | 94,030 | ||||||
Shenzhen Expressway Co. Ltd.–Class H | 112,000 | 113,651 | ||||||
624,883 | ||||||||
France–10.44% | ||||||||
Aéroports de Paris | 1,005 | 220,648 | ||||||
Eiffage S.A. | 3,611 | 428,910 | ||||||
Eutelsat Communications S.A. | 4,432 | 95,839 | ||||||
Getlink S.E. | 11,122 | 157,021 | ||||||
Vinci S.A. | 13,810 | 1,379,090 | ||||||
2,281,508 | ||||||||
Germany–1.06% | ||||||||
Fraport AG Frankfurt Airport Services Worldwide | 2,403 | 232,693 | ||||||
Hong Kong–1.38% | ||||||||
Hong Kong & China Gas Co., Ltd. (The) | 144,000 | 300,802 | ||||||
Italy–1.43% | ||||||||
Atlantia S.p.A. | 8,082 | 267,271 | ||||||
Infrastrutture Wireless Italiane S.p.A.–REGS(a) | 5,760 | 46,354 | ||||||
313,625 | ||||||||
Japan–1.65% | ||||||||
Japan Airport Terminal Co., Ltd. | 5,000 | 204,881 | ||||||
NIPPON GAS CO., LTD.(b) | 1,500 | 73,576 | ||||||
Tokyo Gas Co., Ltd. | 3,100 | 83,143 | ||||||
361,600 | ||||||||
Luxembourg–0.57% | ||||||||
SES S.A. | 8,056 | 124,235 | ||||||
Mexico–0.67% | ||||||||
Grupo Aeroportuario del Pacifico S.A.B. de C.V.–ADR | 1,395 | 145,317 | ||||||
Netherlands–0.58% | ||||||||
InterXion Holding N.V.(b) | 1,960 | 127,439 |
Shares | Value | |||||||
New Zealand–0.46% | ||||||||
Auckland International Airport Ltd. | 22,402 | $ | 100,135 | |||||
Spain–4.56% | ||||||||
Abertis Infraestructuras S.A. | 13,282 | 292,903 | ||||||
Aena SME, S.A.–REGS(a) | 1,636 | 337,228 | ||||||
Cellnex Telecom S.A.–REGS(a) | 5,619 | 150,112 | ||||||
Ferrovial, S.A. | 10,157 | 216,510 | ||||||
996,753 | ||||||||
United Kingdom–9.58% | ||||||||
John Laing Group PLC–REGS(a) | 56,762 | 220,820 | ||||||
National Grid PLC | 68,430 | 792,511 | ||||||
Pennon Group PLC | 44,920 | 427,332 | ||||||
Severn Trent PLC | 18,478 | 492,556 | ||||||
United Utilities Group PLC | 15,875 | 162,124 | ||||||
2,095,343 | ||||||||
United States–45.24% | ||||||||
American Tower Corp.–Class A | 11,780 | 1,606,321 | ||||||
Atmos Energy Corp. | 5,112 | 444,182 | ||||||
CenterPoint Energy, Inc. | 12,165 | 308,139 | ||||||
Cheniere Energy, Inc.(b) | 13,428 | 780,972 | ||||||
CMS Energy Corp. | 8,684 | 409,798 | ||||||
Consolidated Edison, Inc. | 4,545 | 364,191 | ||||||
Crown Castle International Corp. | 11,779 | 1,188,148 | ||||||
Edison International | 9,995 | 654,872 | ||||||
Kinder Morgan, Inc. | 27,395 | 433,389 | ||||||
NiSource Inc. | 19,158 | 467,264 | ||||||
ONEOK, Inc. | 13,554 | 816,222 | ||||||
PG&E Corp. | 19,678 | 907,156 | ||||||
SBA Communications Corp.–Class A(b) | 1,378 | 220,797 | ||||||
Sempra Energy | 6,532 | 730,278 | ||||||
Targa Resources Corp. | 3,756 | 176,419 | ||||||
Williams Cos., Inc. (The) | 14,877 | 382,785 | ||||||
9,890,933 | ||||||||
Total Common Stocks & Other Equity Interests |
| 21,615,921 | ||||||
Money Market Funds–0.67% |
| |||||||
Invesco Government & Agency | 42,549 | 42,549 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(c) | 55,294 | 55,299 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(c) | 48,628 | 48,628 | ||||||
Total Money Market Funds |
| 146,476 | ||||||
TOTAL INVESTMENTS IN SECURITIES–99.54% |
| 21,762,397 | ||||||
OTHER ASSETS LESS LIABILITIES–0.46% |
| 100,424 | ||||||
NET ASSETS–100.00% |
| $ | 21,862,821 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Global Infrastructure Fund
Investment Abbreviations:
ADR | – American Depositary Receipt | |
REGS | – Regulation S |
Notes to Schedule of Investments:
(a) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2018 was $754,514, which represented 3.45% of the Fund’s Net Assets. |
(b) | Non-income producing security. |
(c) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
Portfolio Composition
By Infrastructure Sector, based on Net Assets
as of April 30, 2018
Midstream Services | 26.5 | % | ||
Towers | 20.0 | |||
Gas Distribution | 15.3 | |||
Electric Utilities | 10.7 | |||
Diversified | 10.3 | |||
Tolls | 7.3 | |||
Airports | 6.5 | |||
Infrastructure Sectors each less than 2.0% of the portfolio | 2.3 | |||
Money Market Funds Plus Other Assets Less Liabilities | 1.1 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Global Infrastructure Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: | ||||
Investments in securities, at value (Cost $20,557,319) | $ | 21,615,921 | ||
Investments in affiliated money market funds, at value (Cost $146,469) | 146,476 | |||
Foreign currencies, at value (Cost $86,463) | 85,618 | |||
Receivable for: | ||||
Investments sold | 8,221 | |||
Fund shares sold | 3,968 | |||
Dividends | 39,169 | |||
Fund expenses absorbed | 17,865 | |||
Investment for trustee deferred compensation and retirement plans | 9,549 | |||
Other assets | 51,695 | |||
Total assets | 21,978,482 | |||
Liabilities: | ||||
Payable for: | ||||
Fund shares reacquired | 9,546 | |||
Amount due custodian | 36,106 | |||
Accrued fees to affiliates | 11,284 | |||
Accrued trustees’ and officers’ fees and benefits | 1,477 | |||
Accrued other operating expenses | 47,699 | |||
Trustee deferred compensation and retirement plans | 9,549 | |||
Total liabilities | 115,661 | |||
Net assets applicable to shares outstanding | $ | 21,862,821 | ||
Net assets consist of: | ||||
Shares of beneficial interest | $ | 21,420,915 | ||
Undistributed net investment income | 28,784 | |||
Undistributed net realized gain (loss) | (643,931 | ) | ||
Net unrealized appreciation | 1,057,053 | |||
$ | 21,862,821 |
Net Assets: | ||||
Class A | $ | 9,188,175 | ||
Class C | $ | 1,691,347 | ||
Class R | $ | 375,628 | ||
Class Y | $ | 10,390,340 | ||
Class R5 | $ | 10,184 | ||
Class R6 | $ | 207,147 | ||
Shares outstanding, no par value, |
| |||
Class A | 903,532 | |||
Class C | 166,659 | |||
Class R | 36,958 | |||
Class Y | 1,021,373 | |||
Class R5 | 1,001 | |||
Class R6 | 20,362 | |||
Class A: | ||||
Net asset value per share | $ | 10.17 | ||
Maximum offering price per share | ||||
(Net asset value of $10.17 ¸ 94.50%) | $ | 10.76 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 10.15 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 10.16 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 10.17 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 10.17 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 10.17 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Global Infrastructure Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: | ||||
Dividends (net of foreign withholding taxes of $26,750) | $ | 354,845 | ||
Dividends from affiliated money market funds | 1,273 | |||
Total investment income | 356,118 | |||
Expenses: | ||||
Advisory fees | 92,536 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 12,735 | |||
Distribution fees: | ||||
Class A | 11,490 | |||
Class C | 9,711 | |||
Class R | 815 | |||
Transfer agent fees — A, C, R and Y | 20,517 | |||
Transfer agent fees — R5 | 4 | |||
Transfer agent fees — R6 | 71 | |||
Trustees’ and officers’ fees and benefits | 10,875 | |||
Registration and filing fees | 50,499 | |||
Reports to shareholders | 9,726 | |||
Professional services fees | 33,258 | |||
Other | 6,000 | |||
Total expenses | 283,032 | |||
Less: Fees waived and expenses reimbursed | (147,647 | ) | ||
Net expenses | 135,385 | |||
Net investment income | 220,733 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | 151,483 | |||
Foreign currencies | (4,111 | ) | ||
147,372 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | (787,166 | ) | ||
Foreign currencies | (787 | ) | ||
(787,953 | ) | |||
Net realized and unrealized gain (loss) | (640,581 | ) | ||
Net increase (decrease) in net assets resulting from operations | $ | (419,848 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Global Infrastructure Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: | ||||||||
Net investment income | $ | 220,733 | $ | 429,571 | ||||
Net realized gain | 147,372 | 711,655 | ||||||
Change in net unrealized appreciation (depreciation) | (787,953 | ) | 1,300,196 | |||||
Net increase (decrease) in net assets resulting from operations | (419,848 | ) | 2,441,422 | |||||
Distributions to shareholders from net investment income: | ||||||||
Class A | (121,669 | ) | (133,550 | ) | ||||
Class C | (19,411 | ) | (16,079 | ) | ||||
Class R | (3,747 | ) | (3,225 | ) | ||||
Class Y | (152,893 | ) | (179,756 | ) | ||||
Class R5 | (155 | ) | (215 | ) | ||||
Class R6 | (2,871 | ) | (3,330 | ) | ||||
Total distributions from net investment income | (300,746 | ) | (336,155 | ) | ||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | (208,415 | ) | — | |||||
Class C | (46,749 | ) | — | |||||
Class R | (6,948 | ) | — | |||||
Class Y | (244,308 | ) | — | |||||
Class R5 | (248 | ) | — | |||||
Class R6 | (4,499 | ) | — | |||||
Total distributions from net realized gains | (511,167 | ) | — | |||||
Share transactions–net: | ||||||||
Class A | 813,313 | 3,866,129 | ||||||
Class C | (208,996 | ) | 1,400,904 | |||||
Class R | 96,980 | 202,316 | ||||||
Class Y | 268,998 | 4,473,703 | ||||||
Class R6 | 23,679 | 60,864 | ||||||
Net increase in net assets resulting from share transactions | 993,974 | 10,003,916 | ||||||
Net increase (decrease) in net assets | (237,787 | ) | 12,109,183 | |||||
Net assets: | ||||||||
Beginning of period | 22,100,608 | 9,991,425 | ||||||
End of period (includes undistributed net investment income of $28,784 and $108,797, respectively) | $ | 21,862,821 | $ | 22,100,608 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Global Infrastructure Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is total return through growth of capital and current income.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value.
9 Invesco Global Infrastructure Fund
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net
10 Invesco Global Infrastructure Fund
investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income, if any, are declared and paid quarterly and are recorded on the ex-dividend date. Distributions from net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Master Limited Partnerships — The Fund invests in Master Limited Partnerships (“MLPs”). MLPs are publicly traded partnerships and limited liability companies taxed as partnerships under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”). The Fund invests in MLPs engaged in, among other things, the transportation, storage, processing, refining, marketing, exploration, production and mining of minerals and natural resources. The Fund is a partner in each MLP; accordingly, the Fund is required to take into account the Fund’s allocable share of income, gains, losses, deductions, expenses, and tax credits recognized by each MLP. |
MLP’s may be less liquid and subject to more abrupt or erratic price movements than conventional publicly traded securities.
The Fund is non-diversified and will invest in securities of fewer issues than if it were diversified.
F. | Return of Capital — Distributions received from the Fund’s investments in MLPs generally are comprised of income and return of capital. The Fund records investment income and return of capital based on estimates made at the time such distributions are received. The return of capital portion of the distribution is a reduction to investment income that results in an equivalent reduction in the cost basis of the associated investments and increases net realized gains (losses) and change in unrealized appreciation (depreciation). Such estimates are based on historical information available from each MLP and other industry sources. These estimates will subsequently be revised and may materially differ primarily based on information received from the MLPs after their tax reporting periods are concluded. |
G. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
H. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
I. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
J. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
K. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
11 Invesco Global Infrastructure Fund
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
L. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||||||
First $2.5 billion | 0 | .84% | ||||||
Next $2 billion | 0 | .80% | ||||||
Next $3.5 billion | 0 | .785% | ||||||
Over $8 billion | 0 | .77% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.84%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.28%, 2.03%, 1.53%, 1.03%, 1.03% and 1.03%, respectively, of average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees and reimbursed fund level expenses of $127,055 and reimbursed class level expenses of $8,642, $1,826, $307, $9,742, $4 and $71 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
12 Invesco Global Infrastructure Fund
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $1,819 in front-end sales commissions from the sale of Class A shares and $49 from Class C shares for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period.
During the six months ended April 30, 2018, there were transfers from Level 1 to Level 2 of $5,444,585 and from Level 2 to Level 1 of $83,143, due to foreign fair value adjustments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Australia | $ | — | $ | 1,099,963 | $ | — | $ | 1,099,963 | ||||||||
Canada | 2,920,692 | — | — | 2,920,692 | ||||||||||||
China | 94,030 | 530,853 | — | 624,883 | ||||||||||||
France | 157,020 | 2,124,488 | — | 2,281,508 | ||||||||||||
Germany | — | 232,693 | — | 232,693 | ||||||||||||
Hong Kong | — | 300,802 | — | 300,802 | ||||||||||||
Italy | — | 313,625 | — | 313,625 | ||||||||||||
Japan | 83,143 | 278,457 | — | 361,600 | ||||||||||||
Luxembourg | — | 124,235 | — | 124,235 | ||||||||||||
Mexico | 145,317 | — | — | 145,317 | ||||||||||||
Netherlands | 127,439 | — | — | 127,439 | ||||||||||||
New Zealand | — | 100,135 | — | 100,135 | ||||||||||||
Spain | 292,903 | 703,850 | — | 996,753 | ||||||||||||
United Kingdom | 220,820 | 1,874,523 | — | 2,095,343 | ||||||||||||
United States | 9,890,933 | — | — | 9,890,933 | ||||||||||||
Money Market Funds | 146,476 | — | — | 146,476 | ||||||||||||
Total Investments | $ | 14,078,773 | $ | 7,683,624 | $ | — | $ | 21,762,397 |
NOTE 4—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the
13 Invesco Global Infrastructure Fund
Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Fund.
NOTE 5—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 6—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund had a capital loss carryforward as of October 31, 2017, which expires as follows:
Capital Loss Carryforward* | Total | |||||||||||
Expiration | Short-Term | Long-Term | ||||||||||
Not subject to expiration | $ | 236,436 | $ | — | $ | 236,436 |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
NOTE 7—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $12,691,936 and $12,377,946, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 1,091,376 | ||
Aggregate unrealized (depreciation) of investments | (556,578 | ) | ||
Net unrealized appreciation of investments | $ | 534,798 |
Cost of investments for tax purposes is $21,227,599.
14 Invesco Global Infrastructure Fund
NOTE 8—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 238,102 | $ | 2,517,254 | 540,397 | $ | 5,370,212 | ||||||||||
Class C | 20,787 | 217,748 | 167,142 | 1,644,192 | ||||||||||||
Class R | 10,830 | 111,899 | 27,781 | 281,761 | ||||||||||||
Class Y | 108,101 | 1,109,692 | 604,953 | 5,980,042 | ||||||||||||
Class R6 | 3,386 | 35,029 | 9,889 | 97,616 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 24,876 | 260,600 | 10,009 | 103,226 | ||||||||||||
Class C | 6,072 | 63,754 | 1,522 | 15,805 | ||||||||||||
Class R | 985 | 10,318 | 292 | 3,060 | ||||||||||||
Class Y | 25,395 | 266,108 | 13,517 | 139,417 | ||||||||||||
Class R6 | 666 | 6,967 | 304 | 3,114 | ||||||||||||
Reacquired: | ||||||||||||||||
Class A | (188,248 | ) | (1,964,541 | ) | (157,736 | ) | (1,607,309 | ) | ||||||||
Class C | (48,304 | ) | (490,498 | ) | (25,138 | ) | (259,093 | ) | ||||||||
Class R | (2,419 | ) | (25,237 | ) | (7,704 | ) | (82,505 | ) | ||||||||
Class Y | (106,971 | ) | (1,106,802 | ) | (161,852 | ) | (1,645,756 | ) | ||||||||
Class R6 | (1,761 | ) | (18,317 | ) | (4,001 | ) | (39,866 | ) | ||||||||
Net increase in share activity | 91,497 | $ | 993,974 | 1,019,375 | $ | 10,003,916 |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 46% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
In addition, 16% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser. |
15 Invesco Global Infrastructure Fund
NOTE 9—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 10.74 | $ | 0.10 | $ | (0.28 | ) | $ | (0.18 | ) | $ | (0.14 | ) | $ | (0.25 | ) | $ | (0.39 | ) | $ | 10.17 | (1.78 | )% | $ | 9,188 | 1.28 | %(d) | 2.62 | %(d) | 1.95 | %(d) | 56 | % | |||||||||||||||||||||||
Year ended 10/31/17 | 9.62 | 0.25 | (e) | 1.06 | 1.31 | (0.19 | ) | — | (0.19 | ) | 10.74 | 13.74 | 8,899 | 1.29 | 2.87 | 2.40 | (e) | 99 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.50 | 0.17 | 0.11 | 0.28 | (0.16 | ) | — | (0.16 | ) | 9.62 | 3.01 | 4,194 | 1.40 | 4.29 | 1.76 | 85 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.66 | 0.17 | (1.11 | ) | (0.94 | ) | (0.21 | ) | (0.01 | ) | (0.22 | ) | 9.50 | (8.85 | ) | 3,262 | 1.40 | 6.36 | 1.68 | 84 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.08 | 0.63 | 0.71 | (0.05 | ) | — | (0.05 | ) | 10.66 | 7.12 | 2,497 | 1.39 | (g) | 8.60 | (g) | 1.51 | (g) | 19 | |||||||||||||||||||||||||||||||||||||
Class C |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.72 | 0.06 | (0.28 | ) | (0.22 | ) | (0.10 | ) | (0.25 | ) | (0.35 | ) | 10.15 | (2.15 | ) | 1,691 | 2.03 | (d) | 3.37 | (d) | 1.20 | (d) | 56 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.60 | 0.17 | (e) | 1.06 | 1.23 | (0.11 | ) | — | (0.11 | ) | 10.72 | 12.92 | 2,016 | 2.04 | 3.62 | 1.65 | (e) | 99 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.48 | 0.10 | 0.11 | 0.21 | (0.09 | ) | — | (0.09 | ) | 9.60 | 2.24 | 428 | 2.15 | 5.04 | 1.01 | 85 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.64 | 0.09 | (1.10 | ) | (1.01 | ) | (0.14 | ) | (0.01 | ) | (0.15 | ) | 9.48 | (9.56 | ) | 279 | 2.15 | 7.11 | 0.93 | 84 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.04 | 0.63 | 0.67 | (0.03 | ) | — | (0.03 | ) | 10.64 | 6.71 | 181 | 2.14 | (g) | 9.35 | (g) | 0.76 | (g) | 19 | |||||||||||||||||||||||||||||||||||||
Class R |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.73 | 0.09 | (0.28 | ) | (0.19 | ) | (0.13 | ) | (0.25 | ) | (0.38 | ) | 10.16 | (1.90 | ) | 376 | 1.53 | (d) | 2.87 | (d) | 1.70 | (d) | 56 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.61 | 0.22 | (e) | 1.06 | 1.28 | (0.16 | ) | — | (0.16 | ) | 10.73 | 13.47 | 296 | 1.54 | 3.12 | 2.15 | (e) | 99 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.49 | 0.14 | 0.11 | 0.25 | (0.13 | ) | — | (0.13 | ) | 9.61 | 2.76 | 69 | 1.65 | 4.54 | 1.51 | 85 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.66 | 0.14 | (1.11 | ) | (0.97 | ) | (0.19 | ) | (0.01 | ) | (0.20 | ) | 9.49 | (9.18 | ) | 27 | 1.65 | 6.61 | 1.43 | 84 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.07 | 0.64 | 0.71 | (0.05 | ) | — | (0.05 | ) | 10.66 | 7.05 | 13 | 1.64 | (g) | 8.85 | (g) | 1.26 | (g) | 19 | |||||||||||||||||||||||||||||||||||||
Class Y |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.74 | 0.11 | (0.28 | ) | (0.17 | ) | (0.15 | ) | (0.25 | ) | (0.40 | ) | 10.17 | (1.66 | ) | 10,390 | 1.03 | (d) | 2.37 | (d) | 2.20 | (d) | 56 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.62 | 0.27 | (e) | 1.06 | 1.33 | (0.21 | ) | — | (0.21 | ) | 10.74 | 14.02 | 10,685 | 1.04 | 2.62 | 2.65 | (e) | 99 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.50 | 0.19 | 0.11 | 0.30 | (0.18 | ) | — | (0.18 | ) | 9.62 | 3.27 | 5,177 | 1.15 | 4.04 | 2.01 | 85 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.67 | 0.20 | (1.12 | ) | (0.92 | ) | (0.24 | ) | (0.01 | ) | (0.25 | ) | 9.50 | (8.70 | ) | 4,223 | 1.15 | 6.11 | 1.93 | 84 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.09 | 0.64 | 0.73 | (0.06 | ) | — | (0.06 | ) | 10.67 | 7.29 | 2,287 | 1.14 | (g) | 8.35 | (g) | 1.76 | (g) | 19 | |||||||||||||||||||||||||||||||||||||
Class R5 |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.74 | 0.11 | (0.28 | ) | (0.17 | ) | (0.15 | ) | (0.25 | ) | (0.40 | ) | 10.17 | (1.66 | ) | 10 | 1.03 | (d) | 2.25 | (d) | 2.20 | (d) | 56 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.62 | 0.27 | (e) | 1.06 | 1.33 | (0.21 | ) | — | (0.21 | ) | 10.74 | 14.02 | 11 | 1.04 | 2.54 | 2.65 | (e) | 99 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.50 | 0.19 | 0.11 | 0.30 | (0.18 | ) | — | (0.18 | ) | 9.62 | 3.27 | 10 | 1.15 | 4.02 | 2.01 | 85 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.67 | 0.20 | (1.12 | ) | (0.92 | ) | (0.24 | ) | (0.01 | ) | (0.25 | ) | 9.50 | (8.70 | ) | 10 | 1.15 | 6.00 | 1.93 | 84 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.09 | 0.64 | 0.73 | (0.06 | ) | — | (0.06 | ) | 10.67 | 7.29 | 11 | 1.14 | (g) | 8.34 | (g) | 1.76 | (g) | 19 | |||||||||||||||||||||||||||||||||||||
Class R6 |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.74 | 0.11 | (0.28 | ) | (0.17 | ) | (0.15 | ) | (0.25 | ) | (0.40 | ) | 10.17 | (1.66 | ) | 207 | 1.03 | (d) | 2.25 | (d) | 2.20 | (d) | 56 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.62 | 0.27 | (e) | 1.06 | 1.33 | (0.21 | ) | — | (0.21 | ) | 10.74 | 14.02 | 194 | 1.04 | 2.54 | 2.65 | (e) | 99 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.50 | 0.19 | 0.11 | 0.30 | (0.18 | ) | — | (0.18 | ) | 9.62 | 3.27 | 114 | 1.15 | 4.02 | 2.01 | 85 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.67 | 0.20 | (1.12 | ) | (0.92 | ) | (0.24 | ) | (0.01 | ) | (0.25 | ) | 9.50 | (8.70 | ) | 69 | 1.15 | 6.00 | 1.93 | 84 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.09 | 0.64 | 0.73 | (0.06 | ) | — | (0.06 | ) | 10.67 | 7.29 | 38 | 1.14 | (g) | 8.34 | (g) | 1.76 | (g) | 19 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $9,269, $1,958, $329, $10,447, $10 and $202 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Net investment income per share and the ratio of net investment income to average net assets includes significant dividends received during the period. Net investment income per share and the ratio of net investment income to average net assets excluding the significant dividends are $0.20 and 1.88%, $0.12 and 1.13%, $0.17 and 1.63%, $0.22 and 2.13%, $0.22 and 2.13% and $0.22 and 2.13% for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(f) | Commencement date of May 2, 2014. |
(g) | Annualized. |
16 Invesco Global Infrastructure Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 982.20 | $ | 6.29 | $ | 1,018.45 | $ | 6.41 | 1.28 | % | ||||||||||||
C | 1,000.00 | 978.50 | 9.96 | 1,014.73 | 10.14 | 2.03 | ||||||||||||||||||
R | 1,000.00 | 981.00 | 7.52 | 1,017.21 | 7.65 | 1.53 | ||||||||||||||||||
Y | 1,000.00 | 983.40 | 5.07 | 1,019.69 | 5.16 | 1.03 | ||||||||||||||||||
R5 | 1,000.00 | 983.40 | 5.07 | 1,019.69 | 5.16 | 1.03 | ||||||||||||||||||
R6 | 1,000.00 | 983.40 | 5.07 | 1,019.69 | 5.16 | 1.03 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
17 Invesco Global Infrastructure Fund
Distribution Information Correction notice
The following table sets forth on a per share basis the distribution that was paid in March 2018. Included in the table is a written statement of the sources of the distribution on a generally accepted accounting principles (“GAAP”) basis.
Net Income | Gain from Sale of Securities | Return of Principal | Total Distribution | |||||||||||||||
03/22/18 | Class A | $ | 0.0235 | $ | 0.0000 | $ | 0.0053 | $ | 0.0288 | |||||||||
03/22/18 | Class C | $ | 0.0051 | $ | 0.0000 | $ | 0.0053 | $ | 0.0104 | |||||||||
03/22/18 | Class R | $ | 0.0174 | $ | 0.0000 | $ | 0.0053 | $ | 0.0227 | |||||||||
03/22/18 | Class Y | $ | 0.0297 | $ | 0.0000 | $ | 0.0053 | $ | 0.0350 | |||||||||
03/22/18 | Class R5 | $ | 0.0297 | $ | 0.0000 | $ | 0.0053 | $ | 0.0350 | |||||||||
03/22/18 | Class R6 | $ | 0.0297 | $ | 0.0000 | $ | 0.0053 | $ | 0.0350 |
Please note that the information in the preceding chart is for financial accounting purposes only. Shareholders should be aware that the tax treatment of distributions likely differs from GAAP treatment. Form 1099-DIV for the calendar year will report distributions for U.S. federal income tax purposes. This Notice is sent to comply with certain U.S. Securities and Exchange Commission requirements.
18 Invesco Global Infrastructure Fund
Explore High-Conviction Investing with Invesco
Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
∎ Quarterly statements
∎ Daily confirmations
∎ Tax forms
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. GBLI-SAR-1 06192018 1425
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco Global Market Neutral Fund
| ||||
Nasdaq: | ||||
A: MKNAX ∎ C: MKNCX ∎ R: MKNRX ∎ Y: MKNYX ∎ R5: MKNFX ∎ R6: MKNSX |
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2
| Fund Performance
| |||
4
| Letters to Shareholders
| |||
5
| Schedule of Investments
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10
| Financial Statements
| |||
12
| Notes to Financial Statements
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20
| Financial Highlights
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21
| Fund Expenses
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | -1.32 | % | ||
Class C Shares | -1.78 | |||
Class R Shares | -1.43 | |||
Class Y Shares | -1.20 | |||
Class R5 Shares | -1.10 | |||
Class R6 Shares | -1.20 | |||
FTSE US 3-Month Treasury Bill Index▼ (Broad Market/Style-Specific Index) | 0.67 | |||
Lipper Alternative Equity Market Neutral Funds Index∎ (Peer Group Index) | 0.14 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
|
The FTSE US 3-Month Treasury Bill Index is an unmanaged index representative of three-month Treasury bills.
The Lipper Alternative Equity Market Neutral Funds Index is an unmanaged index considered representative of alternative equity market neutral funds tracked by Lipper.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Global Market Neutral Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (12/19/13) | -0.96 | %* | ||||
1 Year | -6.43 | |||||
Class C Shares |
| |||||
Inception (12/19/13) | -0.41 | %* | ||||
1 Year | -2.80 | |||||
Class R Shares |
| |||||
Inception (12/19/13) | 0.10 | %* | ||||
1 Year | -1.23 | |||||
Class Y Shares |
| |||||
Inception (12/19/13) | 0.58 | %* | ||||
1 Year | -0.80 | |||||
Class R5 Shares |
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Inception (12/19/13) | 0.61 | %* | ||||
1 Year | -0.71 | |||||
Class R6 Shares |
| |||||
Inception (12/19/13) | 0.58 | %* | ||||
1 Year | -0.81 | |||||
* Amount includes the effect of the Adviser pay-in for an economic loss of $0.41 per share for the fiscal period-end 2014 and $0.11 for fiscal period-end 2015. Had the pay-in not been made, average annual total returns were estimated at -2.27%, -1.76%, -1.23%, -0.73%, -0.70% and -0.73% for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
|
|
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.50%, 2.25%, 1.75%, 1.25%, 1.25% and 1.25%, respectively.1,2 The total annual Fund operating expense ratio set forth in the most
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (12/19/13) | -1.31 | %** | ||||
1 Year | -7.40 | |||||
Class C Shares |
| |||||
Inception (12/19/13) | -0.73 | %** | ||||
1 Year | -3.71 | |||||
Class R Shares |
| |||||
Inception (12/19/13) | -0.23 | %** | ||||
1 Year | -2.24 | |||||
Class Y Shares |
| |||||
Inception (12/19/13) | 0.27 | %** | ||||
1 Year | -1.70 | |||||
Class R5 Shares |
| |||||
Inception (12/19/13) | 0.29 | %** | ||||
1 Year | -1.60 | |||||
Class R6 Shares |
| |||||
Inception (12/19/13) | 0.27 | %** | ||||
1 Year | -1.71 | |||||
**Amount includes the effect of the Adviser pay-in for an economic loss of $0.41 per share for the fiscal period-end 2014 and $0.11 for fiscal period-end 2015. Had the pay-in not been made, average annual total returns were estimated at -2.65%, -2.12%, -1.61%, -1.09%, -1.06% and -1.09% for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
|
|
recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 2.88%, 3.63%, 3.13%, 2.63%, 2.55% and 2.55%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least February 28, 2019. See current prospectus for more information. |
2 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco Global Market Neutral Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s |
prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Global Market Neutral Fund
Schedule of Investments
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–92.48% |
| |||||||
Australia–1.09% | ||||||||
Beach Energy Ltd. | 31,882 | $ | 37,541 | |||||
Cochlear Ltd. | 177 | 25,756 | ||||||
Metcash Ltd. | 40,564 | 109,531 | ||||||
172,828 | ||||||||
Austria–1.02% | ||||||||
OMV AG | 2,623 | 162,448 | ||||||
Canada–5.24% | ||||||||
BRP Inc. | 3,618 | 146,388 | ||||||
Canfor Corp.(a) | 4,812 | 110,544 | ||||||
Enerplus Corp. | 16,411 | 190,484 | ||||||
Kinross Gold Corp.(a) | 20,800 | 80,530 | ||||||
Russel Metals Inc. | 4,133 | 93,948 | ||||||
Teck Resources Ltd.–Class B | 1,120 | 28,120 | ||||||
West Fraser Timber Co., Ltd. | 2,674 | 181,162 | ||||||
831,176 | ||||||||
China–1.05% | ||||||||
Yangzijiang Shipbuilding Holdings Ltd. | 190,600 | 166,435 | ||||||
Denmark–1.04% | ||||||||
Dfds A/S | 709 | 44,068 | ||||||
H. Lundbeck A/S | 1,480 | 86,116 | ||||||
Royal Unibrew A/S | 523 | 34,658 | ||||||
164,842 | ||||||||
Finland–1.66% | ||||||||
UPM-Kymmene Oyj | 7,365 | 262,742 | ||||||
France–3.65% | ||||||||
Bouygues S.A. | 586 | 29,759 | ||||||
Faurecia S.A. | 1,325 | 108,090 | ||||||
Nexity S.A. | 2,200 | 137,117 | ||||||
Peugeot S.A. | 12,324 | 303,293 | ||||||
578,259 | ||||||||
Germany–4.34% | ||||||||
CANCOM SE | 249 | 29,288 | ||||||
Covestro AG–REGS(b) | 2,625 | 238,580 | ||||||
Hochtief AG | 1,070 | 195,294 | ||||||
Siltronic AG | 773 | 124,085 | ||||||
Software AG | 1,244 | 61,221 | ||||||
TUI AG | 1,744 | 39,330 | ||||||
687,798 | ||||||||
Ireland–0.22% | ||||||||
Smurfit Kappa Group PLC | 828 | 35,266 | ||||||
Japan–22.27% | ||||||||
Aeon Mall Co., Ltd. | 1,900 | 38,274 | ||||||
Asahi Glass Co., Ltd. | 3,500 | 145,353 |
Shares | Value | |||||||
Japan–(continued) | ||||||||
Benesse Holdings, Inc. | 1,000 | $ | 36,498 | |||||
Brother Industries, Ltd. | 10,900 | 233,926 | ||||||
Citizen Watch Co., Ltd. | 6,300 | 46,860 | ||||||
Dai Nippon Printing Co., Ltd. | 10,000 | 215,015 | ||||||
Daiichikosho Co., Ltd. | 2,400 | 125,998 | ||||||
Daiwa House Industry Co., Ltd. | 2,500 | 91,703 | ||||||
Denka Co., Ltd. | 2,200 | 78,580 | ||||||
Electric Power Development Co., Ltd. | 1,300 | 35,261 | ||||||
Fujitsu Ltd. | 8,000 | 48,442 | ||||||
Haseko Corp. | 6,300 | 99,410 | ||||||
Ibiden Co., Ltd. | 17,300 | 285,919 | ||||||
JTEKT Corp. | 4,800 | 77,812 | ||||||
K’s Holdings Corp. | 12,400 | 179,085 | ||||||
Kurita Water Industries Ltd. | 1,000 | 32,474 | ||||||
Leopalace21 Corp. | 3,900 | 33,927 | ||||||
Marubeni Corp. | 17,400 | 131,044 | ||||||
Miraca Holdings Inc. | 2,000 | 77,652 | ||||||
Mitsubishi Corp. | 3,200 | 88,511 | ||||||
Mitsui & Co., Ltd. | 11,700 | 211,324 | ||||||
mixi, Inc. | 4,800 | 158,223 | ||||||
Nippon Express Co., Ltd. | 1,600 | 121,039 | ||||||
Nippon Telegraph & Telephone Corp. | 900 | 42,851 | ||||||
Nishimatsu Construction Co., Ltd. | 3,600 | 99,287 | ||||||
Penta-Ocean Construction Co., Ltd. | 21,900 | 173,285 | ||||||
TDK Corp. | 600 | 51,133 | ||||||
Tokyo Gas Co., Ltd. | 8,000 | 214,563 | ||||||
Toppan Printing Co., Ltd. | 19,000 | 159,050 | ||||||
West Japan Railway Co. | 2,800 | 198,500 | ||||||
3,530,999 | ||||||||
Malta–0.19% | ||||||||
Kindred Group PLC–SDR | 2,263 | 29,321 | ||||||
Netherlands–0.45% | ||||||||
BE Semiconductor Industries N.V. | 626 | 43,197 | ||||||
Koninklijke Ahold Delhaize N.V. | 1,195 | 28,811 | ||||||
72,008 | ||||||||
New Zealand–0.67% | ||||||||
a2 Milk Co. Ltd.(a) | 12,552 | 105,763 | ||||||
Norway–0.51% | ||||||||
SalMar ASA | 1,733 | 80,666 | ||||||
Panama–0.30% | ||||||||
Copa Holdings, S.A.–Class A | 408 | 47,805 | ||||||
Russia–0.82% | ||||||||
Evraz PLC | 20,544 | 129,276 | ||||||
Singapore–0.24% | ||||||||
SATS Ltd. | 9,300 | 38,637 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Global Market Neutral Fund
Shares | Value | |||||||
Spain–0.65% | ||||||||
Mediaset Espana Comunicacion S.A. | 10,715 | $ | 102,485 | |||||
Sweden–0.74% | ||||||||
Loomis AB–Class B | 1,489 | 54,356 | ||||||
Svenska Cellulosa AB SCA–Class B | 5,739 | 63,690 | ||||||
118,046 | ||||||||
Switzerland–2.13% | ||||||||
Bucher Industries AG | 645 | 235,976 | ||||||
Georg Fischer AG | 31 | 38,511 | ||||||
Oriflame Holding AG | 1,337 | 63,384 | ||||||
337,871 | ||||||||
United Kingdom–7.46% | ||||||||
Electrocomponents PLC | 15,299 | 127,970 | ||||||
Fiat Chrysler Automobiles N.V.(a) | 12,787 | 284,983 | ||||||
GlaxoSmithKline PLC | 4,297 | 86,221 | ||||||
Indivior PLC(a) | 11,018 | 68,143 | ||||||
Moneysupermarket.com Group PLC | 19,301 | 79,630 | ||||||
PageGroup PLC | 10,980 | 80,904 | ||||||
Persimmon PLC | 5,061 | 189,153 | ||||||
Royal Dutch Shell PLC–Class B | 1,828 | 65,295 | ||||||
SSP Group PLC | 3,806 | 34,106 | ||||||
Subsea 7 S.A. | 3,779 | 52,855 | ||||||
WH Smith PLC | 4,232 | 113,478 | ||||||
1,182,738 | ||||||||
United States–36.74% | ||||||||
Aaron’s, Inc. | 2,793 | 116,664 | ||||||
AbbVie Inc. | 2,202 | 212,603 | ||||||
American Equity Investment Life Holding Co. | 998 | 30,140 | ||||||
Amgen Inc. | 506 | 88,287 | ||||||
Assured Guaranty Ltd. | 1,540 | 55,887 | ||||||
AT&T Inc. | 2,603 | 85,118 | ||||||
Baxter International Inc. | 529 | 36,765 | ||||||
Best Buy Co., Inc. | 3,195 | 244,513 | ||||||
Biogen Inc.(a) | 717 | 196,171 | ||||||
Boeing Co. (The) | 874 | 291,531 | ||||||
CF Industries Holdings, Inc. | 901 | 34,959 | ||||||
Cisco Systems, Inc. | 6,385 | 282,792 | ||||||
Citigroup Inc. | 4,090 | 279,224 | ||||||
Darden Restaurants, Inc. | 1,562 | 145,047 | ||||||
Devon Energy Corp. | 3,743 | 135,983 | ||||||
Gap, Inc. (The) | 874 | 25,556 | ||||||
Gilead Sciences, Inc. | 3,045 | 219,940 | ||||||
Greif Inc.–Class A | 726 | 42,485 | ||||||
HollyFrontier Corp. | 1,574 | 95,526 |
Shares | Value | |||||||
United States–(continued) | ||||||||
HP Inc. | 12,803 | $ | 275,136 | |||||
HRG Group, Inc.(a) | 5,688 | 63,933 | ||||||
Humana Inc. | 263 | 77,369 | ||||||
Huntsman Corp. | 2,928 | 87,167 | ||||||
InterDigital, Inc. | 1,220 | 90,829 | ||||||
Juniper Networks, Inc. | 1,671 | 41,090 | ||||||
KB Home | 1,309 | 34,754 | ||||||
Kohl’s Corp. | 462 | 28,699 | ||||||
Lear Corp. | 806 | 150,698 | ||||||
Lincoln National Corp. | 678 | 47,894 | ||||||
LyondelllBasell Industries N.V.–Class A | 800 | 84,584 | ||||||
Macy’s, Inc. | 3,266 | 101,475 | ||||||
Michael Kors Holdings Ltd.(a) | 1,904 | 130,272 | ||||||
Newmont Mining Corp. | 3,910 | 153,624 | ||||||
PotlatchDeltic Corp. | 1,165 | 60,405 | ||||||
Royal Caribbean Cruises Ltd. | 264 | 28,562 | ||||||
Sanderson Farms, Inc. | 323 | 35,905 | ||||||
SBA Communications Corp.(a) | 818 | 131,068 | ||||||
Teradyne, Inc. | 1,627 | 52,959 | ||||||
Transocean Ltd.(a) | 13,091 | 161,936 | ||||||
United Therapeutics Corp.(a) | 404 | 44,484 | ||||||
Valero Energy Corp. | 2,887 | 320,255 | ||||||
VeriSign, Inc.(a) | 1,349 | 158,400 | ||||||
Vertex Pharmaceuticals Inc.(a) | 642 | 98,329 | ||||||
VMware, Inc.–Class A(a) | 769 | 102,477 | ||||||
Voya Financial, Inc. | 4,572 | 239,344 | ||||||
Walmart, Inc. | 634 | 56,084 | ||||||
WellCare Health Plans Inc.(a) | 1,406 | 288,455 | ||||||
Whiting Petroleum Corp.(a) | 1,429 | 58,332 | ||||||
5,823,710 | ||||||||
Total Common Stocks & Other Equity Interests |
| 14,661,119 | ||||||
Money Market Funds–6.76%(c) |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61% | 374,808 | 374,808 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85% | 267,671 | 267,698 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62% | 428,352 | 428,352 | ||||||
Total Money Market Funds |
| 1,070,858 | ||||||
TOTAL INVESTMENTS IN SECURITIES–99.24% |
| 15,731,977 | ||||||
OTHER ASSETS LESS LIABILITIES–0.76% |
| 120,981 | ||||||
NET ASSETS–100.00% |
| $ | 15,852,958 |
Investment Abbreviations:
REGS | – Regulation S | |
SDR | – Swedish Depositary Receipt |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Global Market Neutral Fund
Notes to Schedule of Investments:
(a) | Non-income producing security. |
(b) | Security purchased or received in transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The value of this security at April 30, 2018 represented 1.50% of the Fund’s Net Assets. |
(c) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
Open Over-The-Counter Total Return Swap Agreements | ||||||||||||||||||||||||||||||||||
Reference Entity | Counterparty | Maturity Date | Floating Rate Index(1) | Payment Frequency | Notional Value | Upfront Payments (Received) | Value(2)(3) | Unrealized Appreciation | Net Value of Reference Entities | |||||||||||||||||||||||||
Australia Equity Securities-Short | Morgan Stanley & Co. LLC | 01/23/2019 | | Federal Funds floating rate | | Monthly | $ | (147,573 | ) | $ | — | $ | 855 | $ | 855 | $ | (146,753 | ) | ||||||||||||||||
Canada Equity Securities-Short | Morgan Stanley & Co. LLC | 01/23/2019 | | Federal Funds floating rate | | Monthly | (696,054 | ) | — | 8,283 | 8,283 | (685,952 | ) | |||||||||||||||||||||
Denmark Equity Securities-Short | Morgan Stanley & Co. LLC | 01/23/2019 | | Federal Funds floating rate | | Monthly | (305,186 | ) | — | 4,087 | 4,087 | (301,170 | ) | |||||||||||||||||||||
Euro Area Equity Securities-Short | Morgan Stanley & Co. LLC | 01/23/2019 | | Federal Funds floating rate | | Monthly | (1,954,778 | ) | — | 40,564 | 40,564 | (1,911,439 | ) | |||||||||||||||||||||
Hong Kong Equity Securities-Short | Morgan Stanley & Co. LLC | 10/17/2019 | | Federal Funds floating rate | | Monthly | (36,523 | ) | — | 29 | 29 | (36,496 | ) | |||||||||||||||||||||
Japan Equity Securities-Short | Morgan Stanley & Co. LLC | 01/23/2019 | | Federal Funds floating rate | | Monthly | (3,690,559 | ) | — | 11,136 | 11,136 | (3,680,352 | ) | |||||||||||||||||||||
New Zealand Equity Securities-Short | Morgan Stanley & Co. LLC | 03/24/2020 | | Federal Funds floating rate | | Monthly | (77,300 | ) | — | 99 | 99 | (77,219 | ) | |||||||||||||||||||||
Singapore Equity Securities-Short | Morgan Stanley & Co. LLC | 01/23/2019 | | Federal Funds floating rate | | Monthly | (260,673 | ) | — | 11,367 | 11,367 | (247,749 | ) | |||||||||||||||||||||
Spain Equity Securities-Short | Morgan Stanley & Co. LLC | 02/25/2019 | | Federal Funds floating rate | | Monthly | (136,752 | ) | — | 6,710 | 6,710 | (130,079 | ) | |||||||||||||||||||||
Sweden Equity Securities-Short | Morgan Stanley & Co. LLC | 01/23/2019 | | Federal Funds floating rate | | Monthly | (110,496 | ) | — | 562 | 562 | (109,964 | ) | |||||||||||||||||||||
Switzerland Equity Securities-Short | Morgan Stanley & Co. LLC | 01/23/2019 | | Federal Funds floating rate | | Monthly | (176,889 | ) | — | 13,261 | 13,261 | (163,666 | ) | |||||||||||||||||||||
United Kingdom Equity Securities-Short | Morgan Stanley & Co. LLC | 01/23/2019 | | Federal Funds floating rate | | Monthly | (1,098,657 | ) | — | 392 | 392 | (1,084,225 | ) | |||||||||||||||||||||
Subtotal — Appreciation |
| — | 97,345 | 97,345 | (8,575,064 | ) | ||||||||||||||||||||||||||||
Norway Equity Securities-Short | Morgan Stanley & Co. LLC | 01/23/2019 | | Federal Funds floating rate | | Monthly | (91,175 | ) | — | (1,421 | ) | (1,421 | ) | (92,620 | ) | |||||||||||||||||||
United States Equity Securities-Short | Morgan Stanley & Co. LLC | 12/23/2019 | | Federal Funds floating rate | | Monthly | (5,971,062 | ) | — | (39,739 | ) | (39,739 | ) | (5,992,701 | ) | |||||||||||||||||||
Subtotal — Depreciation |
| — | (41,160 | ) | (41,160 | ) | (6,085,321 | ) | ||||||||||||||||||||||||||
Total Return Swap Agreements — Equity Risk |
| $ | — | $ | 56,185 | $ | 56,185 | $ | (14,660,385 | ) |
(1) | The Fund receives or pays the total return on the short positions underlying the total return swap, and receives a specific Federal Funds floating rate. The total return swaps are settled in U.S. Dollars. |
(2) | Amount includes $(37,107) of dividends payable and financing fees related to the reference entities. |
(3) | Swap agreements collateralized by $50,000 cash held with Morgan Stanley & Co. LLC, the Counterparty. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Global Market Neutral Fund
The following table represents the individual short positions and related values of equity securities underlying the total return swaps with Morgan Stanley & Co. LLC, as of April 30, 2018.
Shares | Value | Percentage of Reference Entities | ||||||||||
Equity Securities — Short |
| |||||||||||
Australia | ||||||||||||
Brambles Ltd. | (4,096 | ) | $ | (30,430 | ) | 0.20 | ||||||
National Australia Bank Ltd. | (4,078 | ) | (88,862 | ) | 0.61 | |||||||
QBE Insurance Group Ltd. | (3,663 | ) | (27,461 | ) | 0.19 | |||||||
(146,753 | ) | |||||||||||
Canada | ||||||||||||
Emera Inc. | (3,049 | ) | (94,983 | ) | 0.66 | |||||||
Enbridge Inc. | (927 | ) | (28,084 | ) | 0.20 | |||||||
EnerCare Inc. | (2,578 | ) | (34,863 | ) | 0.24 | |||||||
Hydro One Ltd. | (5,009 | ) | (79,562 | ) | 0.55 | |||||||
Ivanhoe Mines Ltd. | (20,523 | ) | (42,367 | ) | 0.31 | |||||||
SNC-Lavalin Group Inc. | (2,400 | ) | (105,239 | ) | 0.72 | |||||||
Stella-Jones Inc. | (3,516 | ) | (127,444 | ) | 0.84 | |||||||
Waste Connections, Inc. | (647 | ) | (46,772 | ) | 0.32 | |||||||
Wheaton Precious Metals Corp. | (6,100 | ) | (126,638 | ) | 0.88 | |||||||
(685,952 | ) | |||||||||||
Denmark | ||||||||||||
Chr. Hansen Holding A/S | (335 | ) | (30,470 | ) | 0.21 | |||||||
Genmab A/S | (1,334 | ) | (270,700 | ) | 1.86 | |||||||
(301,170 | ) | |||||||||||
Euro Area | ||||||||||||
ANDRITZ AG | (527 | ) | (28,361 | ) | 0.20 | |||||||
Anheuser-Busch InBev S.A./N.V. | (1,322 | ) | (132,069 | ) | 0.93 | |||||||
Banco BPM S.p.A. | (25,730 | ) | (93,735 | ) | 0.65 | |||||||
Banco Comercial Portugues S.A. | (233,456 | ) | (78,409 | ) | 0.56 | |||||||
Bayerische Motoren Werke AG | (1,367 | ) | (152,661 | ) | 1.03 | |||||||
Bollore S.A. | (25,568 | ) | (127,158 | ) | 0.95 | |||||||
Cairn Homes PLC | (12,550 | ) | (27,221 | ) | 0.19 | |||||||
Daimler AG | (3,584 | ) | (283,510 | ) | 1.94 | |||||||
GEA Group AG | (1,792 | ) | (70,142 | ) | 0.50 | |||||||
Getlink | (5,916 | ) | (83,522 | ) | 0.58 | |||||||
Koninklijke Vopak N.V. | (1,175 | ) | (58,039 | ) | 0.39 | |||||||
Leonardo S.p.A. | (2,606 | ) | (30,245 | ) | 0.22 | |||||||
Nokia Oyj | (46,872 | ) | (281,791 | ) | 1.88 | |||||||
Outokumpu Oyj | (4,345 | ) | (28,231 | ) | 0.22 | |||||||
Renault S.A. | (1,246 | ) | (135,191 | ) | 0.97 | |||||||
Rocket Internet SE | (5,078 | ) | (148,902 | ) | 1.01 | |||||||
Unione di Banche Italiane S.p.A. | (6,717 | ) | (34,679 | ) | 0.23 | |||||||
Valeo S.A. | (1,756 | ) | (117,573 | ) | 0.80 | |||||||
(1,911,439 | ) | |||||||||||
Hong Kong | ||||||||||||
MGM China Holdings Ltd | (13,200 | ) | (36,496 | ) | 0.25 | |||||||
Japan | ||||||||||||
CyberAgent, Inc. | (800 | ) | (44,201 | ) | 0.27 | |||||||
Daifuku Co., Ltd. | (1,800 | ) | (96,817 | ) | 0.68 | |||||||
Fast Retailing Co., Ltd. | (100 | ) | (44,100 | ) | 0.30 |
Shares | Value | Percentage of Reference Entities | ||||||||||
Japan–(continued) |
| |||||||||||
Hamamatsu Photonics K.K. | (6,900 | ) | $ | (266,356 | ) | 1.84 | ||||||
JGC Corp. | (13,400 | ) | (329,116 | ) | 2.21 | |||||||
Kansai Paint Co., Ltd. | (10,600 | ) | (238,917 | ) | 1.63 | |||||||
Keihan Holdings Co., Ltd. | (4,400 | ) | (142,481 | ) | 0.94 | |||||||
Keyence Corp. | (400 | ) | (245,042 | ) | 1.60 | |||||||
Kintetsu Group Holdings Co., Ltd. | (800 | ) | (32,602 | ) | 0.21 | |||||||
Koito Manufacturing Co., Ltd. | (2,000 | ) | (134,468 | ) | 0.93 | |||||||
Kyudenko Corp. | (600 | ) | (28,156 | ) | 0.20 | |||||||
Kyushu Electric Power Co., Inc. | (6,100 | ) | (75,441 | ) | 0.49 | |||||||
LINE Corp. | (800 | ) | (29,235 | ) | 0.20 | |||||||
M3 Inc. | (2,300 | ) | (87,207 | ) | 0.66 | |||||||
Maruichi Steel Tube Ltd. | (1,400 | ) | (47,960 | ) | 0.31 | |||||||
MISUMI Group Inc. | (9,100 | ) | (252,223 | ) | 1.74 | |||||||
Nidec Corp. | (1,600 | ) | (250,860 | ) | 1.67 | |||||||
Nihon M&A Center Inc. | (7,000 | ) | (205,543 | ) | 1.45 | |||||||
Nintendo Co., Ltd. | (100 | ) | (42,234 | ) | 0.29 | |||||||
Nitori Holdings Co., Ltd. | (1,000 | ) | (169,045 | ) | 1.15 | |||||||
Ryohin Keikaku Co., Ltd. | (300 | ) | (103,046 | ) | 0.69 | |||||||
Seria Co., Ltd. | (700 | ) | (34,321 | ) | 0.23 | |||||||
Shimadzu Corp. | (5,000 | ) | (136,114 | ) | 0.95 | |||||||
Shimano Inc. | (600 | ) | (79,802 | ) | 0.53 | |||||||
Start Today Co., Ltd. | (1,000 | ) | (28,906 | ) | 0.20 | |||||||
Tokuyama Corp. | (2,000 | ) | (59,733 | ) | 0.43 | |||||||
Topcon Corp. | (7,500 | ) | (149,561 | ) | 0.99 | |||||||
Toshiba Corp. | (36,000 | ) | (96,487 | ) | 0.67 | |||||||
Tsuruha Holdings Inc. | (1,100 | ) | (158,278 | ) | 1.04 | |||||||
Welcia Holdings Co., Ltd. | (1,400 | ) | (72,100 | ) | 0.48 | |||||||
(3,680,352 | ) | |||||||||||
New Zealand | ||||||||||||
Fletcher Building Ltd. | (16,507 | ) | (73,287 | ) | 0.50 | |||||||
Fletcher Building Ltd., Wts. expiring 05/31/2018 | (3,701 | ) | (3,932 | ) | 0.03 | |||||||
(77,219 | ) | |||||||||||
Norway | ||||||||||||
Schibsted ASA–Class A | (925 | ) | (27,052 | ) | 0.18 | |||||||
Schibsted ASA–Class B | (2,435 | ) | (65,568 | ) | 0.44 | |||||||
(92,620 | ) | |||||||||||
Singapore | ||||||||||||
Sembcorp Industries Ltd. | (107,000 | ) | (247,749 | ) | 1.77 | |||||||
Spain | ||||||||||||
Cellnex Telecom S.A. | (4,843 | ) | (130,079 | ) | 0.93 | |||||||
Sweden | ||||||||||||
Lundin Petroleum AB | (2,469 | ) | (68,294 | ) | 0.47 | |||||||
Skanska AB–Class B | (2,130 | ) | (41,670 | ) | 0.27 | |||||||
(109,964 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Global Market Neutral Fund
Shares | Value | Percentage of Reference Entities | ||||||||||
Switzerland | ||||||||||||
ams AG | (793 | ) | $ | (65,920 | ) | 0.53 | ||||||
Panalpina Welttransport Holding AG | (770 | ) | (97,746 | ) | 0.67 | |||||||
(163,666 | ) | |||||||||||
United Kingdom | ||||||||||||
BBA Aviation PLC | (34,143 | ) | (150,310 | ) | 1.04 | |||||||
British American Tobacco PLC | (550 | ) | (30,278 | ) | 0.20 | |||||||
Cairn Energy PLC | (14,423 | ) | (44,991 | ) | 0.31 | |||||||
Dixons Carphone PLC | (11,903 | ) | (33,263 | ) | 0.23 | |||||||
Essentra PLC | (13,715 | ) | (83,261 | ) | 0.59 | |||||||
Fresnillo PLC | (11,081 | ) | (194,490 | ) | 1.33 | |||||||
Just Eat PLC | (15,709 | ) | (167,334 | ) | 1.12 | |||||||
Paddy Power Betfair PLC | (2,265 | ) | (223,872 | ) | 1.57 | |||||||
Serco Group PLC | (30,457 | ) | (40,355 | ) | 0.28 | |||||||
Shire PLC | (2,181 | ) | (116,071 | ) | 0.78 | |||||||
(1,084,225 | ) | |||||||||||
United States | ||||||||||||
ABM Industries, Inc. | (947 | ) | (29,480 | ) | 0.21 | |||||||
ACADIA Pharmaceuticals, Inc. | (4,363 | ) | (68,979 | ) | 0.59 | |||||||
Advance Auto Parts, Inc. | (427 | ) | (48,870 | ) | 0.31 | |||||||
Advanced Micro Devices, Inc. | (3,876 | ) | (42,171 | ) | 0.26 | |||||||
Alphabet Inc.–Class A | (32 | ) | (32,595 | ) | 0.23 | |||||||
Alphabet Inc.–Class C | (133 | ) | (135,305 | ) | 0.96 | |||||||
Avnet, Inc. | (1,462 | ) | (57,354 | ) | 0.41 | |||||||
Ball Corp. | (4,734 | ) | (189,786 | ) | 1.30 | |||||||
Bank of the Ozarks | (864 | ) | (40,435 | ) | 0.28 | |||||||
Callon Petroleum Co. | (14,411 | ) | (200,457 | ) | 1.39 | |||||||
Charter Communications, Inc.–Class A | (146 | ) | (39,608 | ) | 0.31 | |||||||
Cheniere Energy, Inc. | (3,164 | ) | (184,018 | ) | 1.25 | |||||||
Chipotle Mexican Grill, Inc. | (256 | ) | (108,373 | ) | 0.57 | |||||||
Compass Minerals International, Inc. | (1,348 | ) | (90,720 | ) | 0.62 | |||||||
Coty, Inc.–Class A | (10,215 | ) | (177,230 | ) | 1.15 | |||||||
Dentsply Sirona, Inc. | (1,433 | ) | (72,137 | ) | 0.48 | |||||||
DexCom, Inc. | (2,411 | ) | (176,437 | ) | 1.20 | |||||||
Diamondback Energy, Inc. | (1,567 | ) | (201,281 | ) | 1.36 | |||||||
Dominion Energy, Inc. | (972 | ) | (64,696 | ) | 0.43 | |||||||
Education Realty Trust, Inc. | (1,480 | ) | (48,707 | ) | 0.32 | |||||||
Ellie Mae, Inc. | (582 | ) | (56,378 | ) | 0.35 | |||||||
Envision Healthcare Corp. | (3,701 | ) | (137,566 | ) | 0.94 | |||||||
FireEye, Inc. | (3,073 | ) | (55,468 | ) | 0.39 | |||||||
Gartner, Inc. | (922 | ) | (111,829 | ) | 0.74 | |||||||
General Electric Co. | (4,686 | ) | (65,932 | ) | 0.46 | |||||||
Gulfport Energy Corp. | (9,282 | ) | (86,323 | ) | 0.56 | |||||||
Hexcel Corp. | (1,256 | ) | (83,486 | ) | 0.55 | |||||||
Howard Hughes Corp. | (1,625 | ) | (219,863 | ) | 1.50 | |||||||
II-VI, Inc. | (667 | ) | (25,413 | ) | 0.18 | |||||||
IQVIA Holdings, Inc. | (296 | ) | (28,345 | ) | 0.20 | |||||||
Johnson Controls International PLC | (5,548 | ) | (187,911 | ) | 1.28 | |||||||
Kennedy-Wilson Holdings, Inc. | (8,592 | ) | (162,818 | ) | 1.09 |
Shares | Value | Percentage of Reference Entities | ||||||||||
United States–(continued) | ||||||||||||
LCI Industries | (283 | ) | $ | (26,970 | ) | 0.18 | ||||||
Markel Corp. | (210 | ) | (237,308 | ) | 1.66 | |||||||
Martin Marietta Materials, Inc. | (728 | ) | (141,793 | ) | 0.97 | |||||||
Mattel, Inc. | (17,626 | ) | (260,865 | ) | 1.65 | |||||||
Medicines Co. (The) | (3,974 | ) | (119,578 | ) | 0.79 | |||||||
Monro Muffler Brake, Inc. | (2,191 | ) | (122,586 | ) | 0.81 | |||||||
Murphy USA, Inc. | (980 | ) | (61,319 | ) | 0.42 | |||||||
Nevro Corp. | (1,530 | ) | (136,721 | ) | 0.93 | |||||||
Newell Brands, Inc. | (5,944 | ) | (164,233 | ) | 1.07 | |||||||
O’Reilly Automotive, Inc. | (222 | ) | (56,848 | ) | 0.33 | |||||||
Parsley Energy, Inc.–Class A | (7,579 | ) | (227,597 | ) | 1.58 | |||||||
PriceSmart, Inc | (1,225 | ) | (107,310 | ) | 0.74 | |||||||
TESARO, Inc. | (3,770 | ) | (191,931 | ) | 1.33 | |||||||
Tractor Supply Co. | (1,851 | ) | (125,868 | ) | 0.77 | |||||||
Ultimate Software Group, Inc. (The) | (400 | ) | (95,968 | ) | 0.66 | |||||||
Ultragenyx Pharmaceutical, Inc. | (631 | ) | (32,080 | ) | 0.23 | |||||||
United Bankshares, Inc. | (4,117 | ) | (139,772 | ) | 0.98 | |||||||
U.S. Silica Holdings, Inc. | (1,603 | ) | (48,266 | ) | 0.30 | |||||||
ViaSat, Inc. | (3,193 | ) | (204,288 | ) | 1.39 | |||||||
Vulcan Materials Co. | (260 | ) | (29,039 | ) | 0.20 | |||||||
Wabtec Corp. | (1,185 | ) | (105,240 | ) | 0.71 | |||||||
Wayfair, Inc.–Class A | (445 | ) | (27,724 | ) | 0.22 | |||||||
Zayo Group Holdings, Inc. | (2,739 | ) | (99,426 | ) | 0.70 | |||||||
(5,992,701 | ) | |||||||||||
Total Equity Securities — Short |
| $ | (14,660,385 | ) |
Abbreviations:
Wts. | – Warrants |
Portfolio Composition
By sector, based on total net assets
as of April 30, 2018
Equity Long(1) | Securities Short(2) | Gross Exposure(3) | Net Exposure(4) | |||||||||||||
Industrials | 18.7 | % | 19.0 | % | 37.7 | % | (0.3 | )% | ||||||||
Consumer Discretionary | 17.6 | 17.8 | 35.4 | (0.2 | ) | |||||||||||
Information Technology | 14.5 | 14.8 | 29.3 | (0.3 | ) | |||||||||||
Materials | 10.2 | 9.5 | 19.7 | 0.7 | ||||||||||||
Health Care | 10.1 | 9.1 | 19.2 | 1.0 | ||||||||||||
Energy | 8.1 | 7.2 | 15.3 | 0.9 | ||||||||||||
Financials | 4.1 | 4.7 | 8.8 | (0.6 | ) | |||||||||||
Consumer Staples | 3.7 | 4.3 | 8.0 | (0.6 | ) | |||||||||||
Real Estate | 3.1 | 2.7 | 5.8 | 0.4 | ||||||||||||
Utilities | 1.6 | 2.0 | 3.6 | (0.4 | ) | |||||||||||
Telecommunication Services | 0.8 | 1.4 | 2.2 | (0.6 | ) | |||||||||||
Money Market Funds Plus Other Assets Less Liabilities | 7.5 | — | 7.5 | 7.5 | ||||||||||||
Total | 100.0 | % | 92.5 | % | 192.5 | % | 7.5 | % |
(1) | Represents the value of the equity securities in the portfolio. |
(2) | Represents the value of the equity securities underlying the Fund’s equity short portfolio swaps. |
(3) | Represents the cumulative exposure of the Fund’s long and short positions. |
(4) | Represents the net exposure of the Fund’s long and short positions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Global Market Neutral Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: | ||||
Investments in securities, at value (Cost $11,458,830) | $ | 14,661,119 | ||
Investments in affiliated money market funds, at value | 1,070,858 | |||
Other investments: | ||||
Unrealized appreciation on swap agreements — OTC | 97,345 | |||
Deposits with brokers: | ||||
Cash Collateral — OTC derivatives | 50,000 | |||
Foreign currencies, at value (Cost $12,750) | 12,569 | |||
Receivable for: | ||||
Fund shares sold | 285 | |||
Dividends | 72,238 | |||
Fund expenses absorbed | 10,615 | |||
Investment for trustee deferred compensation and retirement plans | 10,586 | |||
Other assets | 38,607 | |||
Total assets | 16,024,222 | |||
Liabilities: |
| |||
Other investments: | ||||
Unrealized depreciation on swap agreements — OTC | 41,160 | |||
Payable for: | ||||
Fund shares reacquired | 4,000 | |||
Amount due custodian | 49,027 | |||
Accrued fees to affiliates | 3,389 | |||
Accrued trustees’ and officers’ fees and benefits | 1,485 | |||
Accrued other operating expenses | 61,617 | |||
Trustee deferred compensation and retirement plans | 10,586 | |||
Total liabilities | 171,264 | |||
Net assets applicable to shares outstanding | $ | 15,852,958 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 12,865,609 | ||
Undistributed net investment income | (2,874 | ) | ||
Undistributed net realized gain (loss) | (266,903 | ) | ||
Net unrealized appreciation | 3,257,126 | |||
$ | 15,852,958 |
Net Assets: |
| |||
Class A | $ | 7,374,137 | ||
Class C | $ | 143,053 | ||
Class R | $ | 45,014 | ||
Class Y | $ | 6,914,413 | ||
Class R5 | $ | 466,987 | ||
Class R6 | $ | 909,354 | ||
Shares outstanding, no par value, |
| |||
Class A | 797,968 | |||
Class C | 15,978 | |||
Class R | 4,921 | |||
Class Y | 741,293 | |||
Class R5 | 50,001 | |||
Class R6 | 97,444 | |||
Class A: | ||||
Net asset value per share | $ | 9.24 | ||
Maximum offering price per share | ||||
(Net asset value of $9.24 ¸ 94.50%) | $ | 9.78 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 8.95 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 9.15 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 9.33 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 9.34 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 9.33 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco Global Market Neutral Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of foreign withholding taxes of $14,625) | $ | 158,334 | ||
Dividends from affiliated money market funds | 6,594 | |||
Total investment income | 164,928 | |||
Expenses: | ||||
Advisory fees | 76,043 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 4,459 | |||
Distribution fees: | ||||
Class A | 9,128 | |||
Class C | 1,313 | |||
Class R | 94 | |||
Transfer agent fees — A, C, R and Y | 5,961 | |||
Transfer agent fees — R5 | 18 | |||
Transfer agent fees — R6 | 36 | |||
Trustees’ and officers’ fees and benefits | 11,132 | |||
Registration and filing fees | 39,754 | |||
Reports to shareholders | 10,291 | |||
Professional services fees | 46,285 | |||
Other | 10,000 | |||
Total expenses | 239,309 | |||
Less: Fees waived and expenses reimbursed | (129,257 | ) | ||
Net expenses | 110,052 | |||
Net investment income | 54,876 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | 887,990 | |||
Foreign currencies | (2,231 | ) | ||
Swap agreements | (1,089,226 | ) | ||
(203,467 | ) | |||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | (217,911 | ) | ||
Foreign currencies | (1,243 | ) | ||
Swap agreements | 148,507 | |||
(70,647 | ) | |||
Net realized and unrealized gain (loss) | (274,114 | ) | ||
Net increase (decrease) in net assets resulting from operations | $ | (219,238 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco Global Market Neutral Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income | $ | 54,876 | $ | 117,392 | ||||
Net realized gain (loss) | (203,467 | ) | (1,415,189 | ) | ||||
Change in net unrealized appreciation (depreciation) | (70,647 | ) | 1,626,538 | |||||
Net increase (decrease) in net assets resulting from operations | (219,238 | ) | 328,741 | |||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | (523,418 | ) | — | |||||
Class C | (25,478 | ) | — | |||||
Class R | (2,226 | ) | — | |||||
Class Y | (505,288 | ) | — | |||||
Class R5 | (34,326 | ) | — | |||||
Class R6 | (65,827 | ) | — | |||||
Total distributions from net realized gains | (1,156,563 | ) | — | |||||
Share transactions–net: | ||||||||
Class A | 344,750 | (190,910 | ) | |||||
Class C | (204,745 | ) | (256,799 | ) | ||||
Class R | 15,628 | 8,513 | ||||||
Class Y | 34,460 | (4,966,606 | ) | |||||
Class R6 | 21,678 | 162,755 | ||||||
Net increase (decrease) in net assets resulting from share transactions | 211,771 | (5,243,047 | ) | |||||
Net increase (decrease) in net assets | (1,164,030 | ) | (4,914,306 | ) | ||||
Net assets: | ||||||||
Beginning of period | 17,016,988 | 21,931,294 | ||||||
End of period (includes undistributed net investment income of $(2,874) and $(57,750), respectively) | $ | 15,852,958 | $ | 17,016,988 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Global Market Neutral Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek to provide a positive return over a full market cycle from a broadly diversified portfolio of stocks while seeking to limit exposure to the general risks associated with stock market investing.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded.
12 Invesco Global Market Neutral Fund
Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
13 Invesco Global Market Neutral Fund
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
J. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the
14 Invesco Global Market Neutral Fund
Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
K. | Swap Agreements — The Fund may enter into various swap transactions, including interest rate, total return, volatility, variance, index, currency and credit default swap contracts (“CDS”) for investment purposes or to manage interest rate, equity, currency or credit risk. Such transactions are agreements between Counterparties. These agreements may contain among other conditions, events of default and termination events, and various covenants and representations such as provisions that require the Fund to maintain a pre-determined level of net assets, and/or provide limits regarding the decline of the Fund’s NAV over specific periods of time. If the Fund were to trigger such provisions and have open derivative positions at that time, the Counterparty may be able to terminate such agreement and request immediate payment in an amount equal to the net liability positions, if any. |
Interest rate, total return, volatility, variance, index, and currency swap agreements are two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a notional amount, i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate or return of an underlying asset, in a particular foreign currency, or in a “basket” of securities representing a particular index.
A total return swap is an agreement in which one party makes payments based on a set rate, either fixed or variable, while the other party makes payments based on the return of an underlying asset, which includes both the income generated and capital gains, if any. The unrealized appreciation (depreciation) on total return swaps includes dividends on the underlying equity securities and financing rate payable from the Counterparty. At the maturity date, a net cash flow is exchanged where the total return is equivalent to the return of the underlying reference less a financing rate, if any. As a receiver, the Fund would receive payments based on any positive total return and would owe payments in the event of a negative total return. As the payer, the Fund would owe payments on any net positive total return, and would receive payment in the event of a negative total return.
Changes in the value of swap agreements are recognized as unrealized gains (losses) in the Statement of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Statement of Assets and Liabilities and may be referred to as upfront payments. The Fund accrues for the fixed payment stream and amortizes upfront payments, if any, on swap agreements on a daily basis with the net amount, recorded as a component of realized gain (loss) on the Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Statement of Operations. The Fund segregates cash or liquid securities having a value at least equal to the amount of the potential obligation of a Fund under any swap transaction. Cash held as collateral is recorded as deposits with brokers on the Statement of Assets and Liabilities. Entering into these agreements involves, to varying degrees, lack of liquidity and elements of credit, market, and Counterparty risk in excess of amounts recognized on the Statement of Assets and Liabilities. Such risks involve the possibility that a swap is difficult to sell or liquidate; the Counterparty does not honor its obligations under the agreement and unfavorable interest rates and market fluctuations. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund’s exposure is unlimited.
L. | Leverage Risk — Leverage exists when the Fund can lose more than it originally invests because it purchases or sells an instrument or enters into a transaction without investing an amount equal to the full economic exposure of the instrument or transaction. |
M. | Collateral — To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund’s practice to replace such collateral no later than the next business day. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $250 million | 0.95% | |||
Next $250 million | 0.93% | |||
Next $500 million | 0.91% | |||
Next $1.5 billion | 0.89% | |||
Next $2.5 billion | 0.87% | |||
Next $2.5 billion | 0.85% | |||
Next $2.5 billion | 0.83% | |||
Over $10 billion | 0.81% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.95%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
15 Invesco Global Market Neutral Fund
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.50%, 2.25%, 1.75%, 1.25%, 1.25% and 1.25% of average daily net assets (the “expense limits”), respectively. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $123,242 and reimbursed class level expenses of $2,980, $107, $15, $2,859, $18 and $36 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $34 in front-end sales commissions from the sale of Class A shares. No CDSC were imposed upon redemptions by shareholders during the period.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
16 Invesco Global Market Neutral Fund
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were transfers from Level 1 to Level 2 of $2,389,569 and from Level 2 to Level 1 of $1,222,489, due to foreign fair value adjustments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Australia | $ | — | $ | 172,828 | $ | — | $ | 172,828 | ||||||||
Austria | — | 162,448 | — | 162,448 | ||||||||||||
Canada | 831,176 | — | — | 831,176 | ||||||||||||
China | — | 166,435 | — | 166,435 | ||||||||||||
Denmark | 86,116 | 78,726 | — | 164,842 | ||||||||||||
Finland | — | 262,742 | — | 262,742 | ||||||||||||
France | — | 578,259 | — | 578,259 | ||||||||||||
Germany | — | 687,798 | — | 687,798 | ||||||||||||
Ireland | 35,266 | — | — | 35,266 | ||||||||||||
Japan | 1,288,889 | 2,242,110 | — | 3,530,999 | ||||||||||||
Malta | 29,321 | — | — | 29,321 | ||||||||||||
Netherlands | — | 72,008 | — | 72,008 | ||||||||||||
New Zealand | — | 105,763 | — | 105,763 | ||||||||||||
Norway | — | 80,666 | — | 80,666 | ||||||||||||
Panama | 47,805 | — | — | 47,805 | ||||||||||||
Russia | — | 129,276 | — | 129,276 | ||||||||||||
Singapore | — | 38,637 | — | 38,637 | ||||||||||||
Spain | — | 102,485 | — | 102,485 | ||||||||||||
Sweden | — | 118,046 | — | 118,046 | ||||||||||||
Switzerland | — | 337,871 | — | 337,871 | ||||||||||||
United Kingdom | 268,783 | 913,955 | — | 1,182,738 | ||||||||||||
United States | 5,823,710 | — | — | 5,823,710 | ||||||||||||
Money Market Funds | 1,070,858 | — | — | 1,070,858 | ||||||||||||
Total Investments in Securities | 9,481,924 | 6,250,053 | — | 15,731,977 | ||||||||||||
Other Investments — Assets* | ||||||||||||||||
Swap Agreements | — | 97,345 | — | 97,345 | ||||||||||||
Other Investments — Liabilities* | ||||||||||||||||
Swap Agreements | — | (41,160 | ) | — | (41,160 | ) | ||||||||||
Total Other Investments | 56,185 | 56,185 | ||||||||||||||
Total Investments | $ | 9,481,924 | $ | 6,306,238 | $ | — | $ | 15,788,162 |
* | Unrealized appreciation (depreciation). |
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Statement of Assets and Liabilities.
17 Invesco Global Market Neutral Fund
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2018:
Value | ||||
Derivative Assets | Equity Risk | |||
Unrealized appreciation on swap agreements — OTC | $ | 97,345 | ||
Derivatives not subject to master netting agreements | — | |||
Total Derivative Assets subject to master netting agreements | $ | 97,345 | ||
Derivative Liabilities | Equity Risk | |||
Unrealized depreciation on swap agreements — OTC | $ | (41,160 | ) | |
Derivatives not subject to master netting agreements | — | |||
Total Derivative Liabilities subject to master netting agreements | $ | (41,160 | ) |
Offsetting Assets and Liabilities
The table below reflects the Fund’s exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of April 30, 2018.
Financial Derivative Assets | Financial Derivative Liabilities | Net Value of | Collateral (Received)/Pledged | Net | ||||||||||||||||||||
Counterparty | Swap Agreements | Swap Agreements | Non-Cash | Cash | ||||||||||||||||||||
Morgan Stanley & Co. LLC | $ | 97,345 | $ | (41,160 | ) | $ | 56,185 | $ | — | $ | — | $ | 56,185 |
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Statement of Operations | ||||
Equity Risk | ||||
Realized Gain (Loss): | ||||
Swap agreements | $ | (1,089,226 | ) | |
Change in Net Unrealized Appreciation: | ||||
Swap agreements | 148,507 | |||
Total | $ | (940,719 | ) |
The table below summarizes the average notional value of swap agreements outstanding during the period.
Swap Agreements | ||||
Average notional value | $ | 15,050,971 |
NOTE 5—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Fund.
NOTE 6—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 7—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
18 Invesco Global Market Neutral Fund
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2017.
NOTE 8—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $2,676,102 and $4,690,530, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 3,596,833 | ||
Aggregate unrealized (depreciation) of investments | (450,430 | ) | ||
Net unrealized appreciation of investments | $ | 3,146,403 |
Cost of investments for tax purposes is $12,641,759.
NOTE 9—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 27,875 | $ | 259,766 | 50,956 | $ | 506,412 | ||||||||||
Class C | 249 | 2,238 | 8,688 | 84,771 | ||||||||||||
Class R | 1,522 | 14,089 | 863 | 8,513 | ||||||||||||
Class Y | 5,101 | 47,230 | 87,656 | 880,836 | ||||||||||||
Class R6 | 6,754 | 64,297 | 32,982 | 330,711 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 23,313 | 215,178 | — | — | ||||||||||||
Class C | 1,398 | 12,539 | — | — | ||||||||||||
Class R | 168 | 1,539 | — | — | ||||||||||||
Class Y | 21,188 | 197,049 | — | — | ||||||||||||
Class R6 | 3,384 | 31,502 | — | — | ||||||||||||
Reacquired: | ||||||||||||||||
Class A | (13,952 | ) | (130,194 | ) | (69,912 | ) | (697,322 | ) | ||||||||
Class C | (24,544 | ) | (219,522 | ) | (34,891 | ) | (341,570 | ) | ||||||||
Class Y | (22,482 | ) | (209,819 | ) | (581,028 | ) | (5,847,442 | ) | ||||||||
Class R6 | (7,903 | ) | (74,121 | ) | (16,681 | ) | (167,956 | ) | ||||||||
Net increase (decrease) in share activity | 22,071 | $ | 211,771 | (521,367 | ) | $ | (5,243,047 | ) |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 32% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
In addition, 59% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser. |
19 Invesco Global Market Neutral Fund
NOTE 10—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 10.06 | $ | 0.03 | $ | (0.16 | ) | $ | (0.13 | ) | $ | — | $ | (0.69 | ) | $ | (0.69 | ) | $ | 9.24 | (1.32 | )% | $ | 7,374 | 1.49 | %(d) | 3.11 | %(d) | 0.57 | %(d) | 18 | % | ||||||||||||||||||||||||
Year ended 10/31/17 | 9.91 | 0.05 | 0.10 | 0.15 | — | — | — | 10.06 | 1.51 | 7,654 | 1.52 | 2.93 | 0.51 | 35 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.31 | 0.10 | (0.47 | ) | (0.37 | ) | — | (0.03 | ) | (0.03 | ) | 9.91 | (3.64 | ) | 7,729 | 1.61 | 2.89 | 1.00 | 79 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.49 | 0.07 | (0.06 | ) | 0.01 | (0.18 | ) | (0.01 | ) | (0.19 | ) | 10.31 | 0.16 | (e) | 5,716 | 1.61 | 3.28 | 0.69 | 77 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.04 | 0.45 | 0.49 | — | — | — | 10.49 | 4.90 | (g) | 5,197 | 1.61 | (h) | 4.61 | (h) | 0.43 | (h) | 46 | ||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.81 | (0.01 | ) | (0.16 | ) | (0.17 | ) | — | (0.69 | ) | (0.69 | ) | 8.95 | (1.78 | ) | 143 | 2.24 | (d) | 3.86 | (d) | (0.18 | )(d) | 18 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.74 | (0.02 | ) | 0.09 | 0.07 | — | — | — | 9.81 | 0.72 | 381 | 2.27 | 3.68 | (0.24 | ) | 35 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.20 | 0.03 | (0.46 | ) | (0.43 | ) | — | (0.03 | ) | (0.03 | ) | 9.74 | (4.27 | ) | 634 | 2.36 | 3.64 | 0.25 | 79 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.41 | (0.01 | ) | (0.03 | ) | (0.04 | ) | (0.16 | ) | (0.01 | ) | (0.17 | ) | 10.20 | (0.35 | )(e) | 603 | 2.36 | 4.03 | (0.06 | ) | 77 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.03 | ) | 0.44 | 0.41 | — | — | — | 10.41 | 4.10 | (g) | 123 | 2.36 | (h) | 5.36 | (h) | (0.32 | )(h) | 46 | |||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.98 | 0.01 | (0.15 | ) | (0.14 | ) | — | (0.69 | ) | (0.69 | ) | 9.15 | (1.43 | ) | 45 | 1.74 | (d) | 3.36 | (d) | 0.32 | (d) | 18 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.86 | 0.03 | 0.09 | 0.12 | — | — | — | 9.98 | 1.22 | 32 | 1.77 | 3.18 | 0.26 | 35 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.27 | 0.08 | (0.46 | ) | (0.38 | ) | — | (0.03 | ) | (0.03 | ) | 9.86 | (3.75 | ) | 23 | 1.86 | 3.14 | 0.75 | 79 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.46 | 0.05 | (0.05 | ) | (0.00 | ) | (0.18 | ) | (0.01 | ) | (0.19 | ) | 10.27 | (0.01 | )(e) | 17 | 1.86 | 3.53 | 0.44 | 77 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.02 | 0.44 | 0.46 | — | — | — | 10.46 | 4.60 | (g) | 14 | 1.86 | (h) | 4.86 | (h) | 0.18 | (h) | 46 | ||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.14 | 0.04 | (0.16 | ) | (0.12 | ) | — | (0.69 | ) | (0.69 | ) | 9.33 | (1.20 | ) | 6,914 | 1.24 | (d) | 2.86 | (d) | 0.82 | (d) | 18 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.96 | 0.08 | 0.10 | 0.18 | — | — | — | 10.14 | 1.81 | 7,476 | 1.27 | 2.68 | 0.76 | 35 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.34 | 0.13 | (0.48 | ) | (0.35 | ) | — | (0.03 | ) | (0.03 | ) | 9.96 | (3.43 | ) | 12,261 | 1.36 | 2.64 | 1.25 | 79 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.52 | 0.10 | (0.06 | ) | 0.04 | (0.21 | ) | (0.01 | ) | (0.22 | ) | 10.34 | 0.38 | (e) | 12,305 | 1.36 | 3.03 | 0.94 | 77 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.06 | 0.46 | 0.52 | — | — | — | 10.52 | 5.20 | (g) | 7,311 | 1.36 | (h) | 4.36 | (h) | 0.68 | (h) | 46 | ||||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.14 | 0.04 | (0.15 | ) | (0.11 | ) | — | (0.69 | ) | (0.69 | ) | 9.34 | (1.10 | ) | 467 | 1.24 | (d) | 2.79 | (d) | 0.82 | (d) | 18 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.96 | 0.08 | 0.10 | 0.18 | — | — | — | 10.14 | 1.81 | 507 | 1.26 | 2.60 | 0.77 | 35 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.34 | 0.13 | (0.48 | ) | (0.35 | ) | — | (0.03 | ) | (0.03 | ) | 9.96 | (3.43 | ) | 498 | 1.36 | 2.56 | 1.25 | 79 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.51 | 0.10 | (0.05 | ) | 0.05 | (0.21 | ) | (0.01 | ) | (0.22 | ) | 10.34 | 0.47 | (e) | 517 | 1.36 | 2.97 | 0.94 | 77 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.06 | 0.45 | 0.51 | — | — | — | 10.51 | 5.10 | (g) | 671 | 1.36 | (h) | 4.33 | (h) | 0.68 | (h) | 46 | ||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.14 | 0.04 | (0.16 | ) | (0.12 | ) | — | (0.69 | ) | (0.69 | ) | 9.33 | (1.20 | ) | 909 | 1.24 | (d) | 2.79 | (d) | 0.82 | (d) | 18 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 9.97 | 0.08 | 0.09 | 0.17 | — | — | — | 10.14 | 1.71 | 966 | 1.26 | 2.60 | 0.77 | 35 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.34 | 0.13 | (0.47 | ) | (0.34 | ) | — | (0.03 | ) | (0.03 | ) | 9.97 | (3.33 | ) | 786 | 1.36 | 2.56 | 1.25 | 79 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.51 | 0.10 | (0.05 | ) | 0.05 | (0.21 | ) | (0.01 | ) | (0.22 | ) | 10.34 | 0.47 | (e) | 664 | 1.36 | 2.97 | 0.94 | 77 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.06 | 0.45 | 0.51 | — | — | — | 10.51 | 5.10 | (g) | 573 | 1.36 | (h) | 4.33 | (h) | 0.68 | (h) | 46 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $7,363 , $265 , $38 , $7,065 , $474 and $937 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Amount includes the effect of the Adviser pay-in for an economic loss of $0.11 per share. Had the pay-in not been made, the total return would have been (0.91)%, (1.42)%, (1.09)%, (0.69)%, (0.60)% and (0.60)% for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(f) | Commencement December 19, 2013. |
(g) | Amount includes the effect of the Adviser pay-in for the economic loss of $0.41 per share. Had the pay-in not been made, the total return would have been 0.80%, 0.10%, 0.60%, 1.00%, 1.00% and 1.00% for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(h) | Annualized. |
20 Invesco Global Market Neutral Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 986.80 | $ | 7.34 | $ | 1,017.41 | $ | 7.45 | 1.49 | % | ||||||||||||
C | 1,000.00 | 982.20 | 11.01 | 1,013.69 | 11.18 | 2.24 | ||||||||||||||||||
R | 1,000.00 | 985.70 | 8.57 | 1,016.17 | 8.70 | 1.74 | ||||||||||||||||||
Y | 1,000.00 | 988.00 | 6.11 | 1,018.65 | 6.21 | 1.24 | ||||||||||||||||||
R5 | 1,000.00 | 989.00 | 6.12 | 1,018.65 | 6.21 | 1.24 | ||||||||||||||||||
R6 | 1,000.00 | 988.00 | 6.11 | 1,018.65 | 6.21 | 1.24 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
21 Invesco Global Market Neutral Fund
Explore High-Conviction Investing with Invesco
Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
∎ Quarterly statements
∎ Daily confirmations
∎ Tax forms
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. | GMN-SAR-1 06252018 0953 |
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco Global Targeted Returns Fund
| ||||
Nasdaq: | ||||
A: GLTAX ∎ C: GLTCX ∎ R: GLTRX ∎ Y: GLTYX ∎ R5: GLTFX ∎ R6: GLTSX |
| ||||
2
| Fund Performance
| |||
4
| Letters to Shareholders
| |||
5
| Consolidated Schedule of Investments
| |||
41
| Consolidated Financial Statements
| |||
44
| Notes to Consolidated Financial Statements
| |||
55
| Financial Highlights
| |||
56
| Fund Expenses
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | -1.00 | % | ||
Class C Shares | -1.33 | |||
Class R Shares | -1.11 | |||
Class Y Shares | -0.90 | |||
Class R5 Shares | -0.90 | |||
Class R6 Shares | -0.90 | |||
FTSE US 3-Month Treasury Bill Index▼ (Broad Market/Style-Specific Index) | 0.67 | |||
Source(s): ▼FactSet Research Systems Inc. |
|
The FTSE US 3-Month Treasury Bill Index is an unmanaged index representative of three-month US Treasury bills. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Global Targeted Returns Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
| ||||||
Class A Shares |
| |||||
Inception (12/19/13) | 0.31 | % | ||||
1 Year | -6.25 | |||||
Class C Shares |
| |||||
Inception (12/19/13) | 0.85 | % | ||||
1 Year | -2.61 | |||||
Class R Shares |
| |||||
Inception (12/19/13) | 1.36 | % | ||||
1 Year | -1.11 | |||||
Class Y Shares |
| |||||
Inception (12/19/13) | 1.85 | % | ||||
1 Year | -0.60 | |||||
Class R5 Shares |
| |||||
Inception (12/19/13) | 1.88 | % | ||||
1 Year | -0.60 | |||||
Class R6 Shares |
| |||||
Inception (12/19/13) | 1.85 | % | ||||
1 Year | -0.60 |
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.44%, 2.19%, 1.69%, 1.19%, 1.19% and 1.19%, respectively.1,2 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 2.11%, 2.86%, 2.36%, 1.86%, 1.82% and 1.76%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (12/19/13) | 0.39 | % | ||||
1 Year | -5.25 | |||||
Class C Shares |
| |||||
Inception (12/19/13) | 0.97 | % | ||||
1 Year | -1.41 | |||||
Class R Shares |
| |||||
Inception (12/19/13) | 1.46 | % | ||||
1 Year | 0.10 | |||||
Class Y Shares |
| |||||
Inception (12/19/13) | 1.96 | % | ||||
1 Year | 0.60 | |||||
Class R5 Shares |
| |||||
Inception (12/19/13) | 1.99 | % | ||||
1 Year | 0.60 | |||||
Class R6 Shares |
| |||||
Inception (12/19/13) | 1.96 | % | ||||
1 Year | 0.60 |
report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 class shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least February 28, 2019. See current prospectus for more information. |
2 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco Global Targeted Returns Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including performance, holdings and portfolio manager commentaries. You can access information about |
your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Global Targeted Returns Fund
Consolidated Schedule of Investments
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–35.93% |
| |||||||
Australia–0.33% | ||||||||
Alumina Ltd. | 10,563 | $ | 20,813 | |||||
Amcor Ltd. | 6,212 | 64,093 | ||||||
BHP Billiton PLC | 6,008 | 127,347 | ||||||
Fairfax Media Ltd. | 26,334 | 14,099 | ||||||
Metcash Ltd. | 15,187 | 41,008 | ||||||
Newcrest Mining Ltd. | 2,237 | 35,482 | ||||||
Origin Energy Ltd.(a) | 4,372 | 31,885 | ||||||
QBE Insurance Group Ltd. | 6,529 | 48,809 | ||||||
Woodside Petroleum Ltd. | 2,702 | 65,285 | ||||||
448,821 | ||||||||
Austria–0.07% | ||||||||
OMV AG | 1,106 | 68,497 | ||||||
voestalpine AG | 597 | 31,408 | ||||||
99,905 | ||||||||
Belgium–0.12% | ||||||||
Colruyt S.A. | 300 | 16,871 | ||||||
Proximus S.A. | 1,729 | 52,774 | ||||||
UCB S.A. | 1,197 | 90,211 | ||||||
159,856 | ||||||||
Brazil–0.20% | ||||||||
EZ Tec Empreendimentos e Participacoes S.A. | 16,300 | 92,398 | ||||||
Kroton Educacional S.A. | 9,700 | 38,955 | ||||||
Telefonica Brasil S.A.–Preference Shares | 10,487 | 147,839 | ||||||
279,192 | ||||||||
Canada–0.34% | ||||||||
Agnico Eagle Mines Ltd. | 869 | 36,576 | ||||||
Canadian Natural Resources Ltd. | 6,696 | 241,613 | ||||||
Goldcorp, Inc. | 4,586 | 60,948 | ||||||
Methanex Corp. | 1,211 | 73,145 | ||||||
PrairieSky Royalty Ltd. | 2,887 | 64,028 | ||||||
476,310 | ||||||||
China–2.20% | ||||||||
51job, Inc.–ADR(a) | 2,089 | 172,426 | ||||||
Alibaba Group Holding Ltd.–ADR(a) | 739 | 131,941 | ||||||
Baidu, Inc.–ADR(a) | 1,214 | 304,593 | ||||||
Bank of China Ltd.–Class H | 226,000 | 122,512 | ||||||
Bitauto Holdings Ltd.–ADR(a) | 2,763 | 58,493 | ||||||
Changyou.com Ltd.–ADR | 339 | 6,451 | ||||||
China Communications Services Corp. Ltd.–Class H | 54,000 | 33,985 | ||||||
China Conch Venture Holdings Ltd. | 32,000 | 99,335 | ||||||
China Mobile Ltd. | 33,000 | 313,830 | ||||||
China Resources Power Holdings Co. Ltd. | 42,000 | 80,509 | ||||||
CNOOC Ltd. | 155,000 | 261,519 |
Shares | Value | |||||||
China–(continued) | ||||||||
Dongfeng Motor Group Co. Ltd.–Class H | 34,000 | $ | 37,623 | |||||
ENN Energy Holdings Ltd. | 10,000 | 94,030 | ||||||
FIH Mobile Ltd.(a) | 13,000 | 2,229 | ||||||
Industrial & Commercial Bank of China Ltd.–Class H | 260,000 | 228,692 | ||||||
JD.com, Inc.–ADR(a) | 9,480 | 346,115 | ||||||
Minth Group Ltd. | 24,000 | 114,045 | ||||||
NetEase, Inc.–ADR | 912 | 234,448 | ||||||
Qingdao Port International Co., Ltd.–Class H–REGS(b) | 80,000 | 65,641 | ||||||
Sohu.com Inc.(a) | 349 | 10,812 | ||||||
Tencent Holdings Ltd. | 5,500 | 270,032 | ||||||
Zhejiang Expressway Co., Ltd.–Class H | 36,000 | 36,881 | ||||||
3,026,142 | ||||||||
Denmark–0.44% | ||||||||
A.P. Møller — Maersk A/S–Class B | 69 | 110,486 | ||||||
Carlsberg A/S–Class B | 875 | 97,828 | ||||||
Danske Bank A/S | 3,304 | 115,108 | ||||||
GN Store Nord A/S | 1,015 | 35,589 | ||||||
H. Lundbeck A/S | 1,234 | 71,802 | ||||||
Novo Nordisk A/S–Class B | 2,431 | 114,136 | ||||||
Rockwool International A/S–Class B | 51 | 15,364 | ||||||
Sydbank A/S | 391 | 14,462 | ||||||
William Demant Holding A/S(a) | 863 | 33,582 | ||||||
608,357 | ||||||||
Faroe Islands–0.01% | ||||||||
Bakkafrost P/F | 142 | 8,145 | ||||||
Finland–0.65% | ||||||||
Nokia Oyj | 35,607 | 214,833 | ||||||
Stora Enso Oyj–Class R | 14,329 | 283,073 | ||||||
UPM-Kymmene Oyj | 11,074 | 395,058 | ||||||
892,964 | ||||||||
France–2.39% | ||||||||
Airbus S.E. | 2,247 | 263,254 | ||||||
AXA S.A. | 2,771 | 79,218 | ||||||
BNP Paribas S.A. | 3,255 | 250,896 | ||||||
Bouygues S.A. | 1,105 | 56,115 | ||||||
Capgemini SE | 1,977 | 271,354 | ||||||
Cie Generale des Etablissements Michelin SCA | 1,809 | 253,886 | ||||||
Dassault Aviation S.A. | 18 | 35,898 | ||||||
Engie S.A. | 7,663 | 134,310 | ||||||
Faurecia S.A. | 1,514 | 123,508 | ||||||
Legrand S.A. | 926 | 71,817 | ||||||
Nexity S.A. | 260 | 16,205 | ||||||
Orange S.A. | 23,008 | 418,260 | ||||||
Peugeot S.A. | 1,549 | 38,121 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
5 Invesco Global Targeted Returns Fund
Shares | Value | |||||||
France–(continued) | ||||||||
Safran S.A. | 949 | $ | 111,309 | |||||
Société Générale S.A. | 2,072 | 113,503 | ||||||
TOTAL S.A. | 16,871 | 1,059,526 | ||||||
3,297,180 | ||||||||
Germany–1.56% | ||||||||
Allianz S.E. | 441 | 104,334 | ||||||
Aurubis AG | 318 | 28,330 | ||||||
BASF S.E. | 2,331 | 242,191 | ||||||
Bayer AG | 4,325 | 517,787 | ||||||
Beiersdorf AG | 239 | 27,084 | ||||||
Covestro AG–REGS(b) | 1,161 | 105,520 | ||||||
Deutsche Post AG | 8,782 | 382,450 | ||||||
Deutsche Telekom AG | 7,053 | 123,331 | ||||||
Fraport AG Frankfurt Airport Services Worldwide | 695 | 67,300 | ||||||
Hochtief AG | 270 | 49,280 | ||||||
Muenchener Rueckversicherungs-Gesellschaft AG | 211 | 48,352 | ||||||
Rheinmetall AG | 496 | 64,884 | ||||||
SAP S.E. | 902 | 100,544 | ||||||
Software AG | 322 | 15,847 | ||||||
TAG Immobilien AG | 1,341 | 28,325 | ||||||
TUI AG | 5,542 | 124,980 | ||||||
Volkswagen AG–Preference Shares | 568 | 117,634 | ||||||
2,148,173 | ||||||||
Hong Kong–0.70% | ||||||||
AIA Group Ltd. | 41,800 | 373,200 | ||||||
CK Asset Holdings Ltd. | 17,000 | 146,553 | ||||||
CK Hutchison Holdings Ltd. | 22,000 | 259,835 | ||||||
Pacific Basin Shipping Ltd.(a) | 60,000 | 15,946 | ||||||
Standard Chartered PLC | 14,400 | 151,142 | ||||||
Yue Yuen Industrial (Holdings) Ltd.(a) | 7,500 | 21,357 | ||||||
968,033 | ||||||||
India–0.75% | ||||||||
Adani Ports & Special Economic Zone Ltd. | 9,412 | 57,222 | ||||||
Godrej Consumer Products Ltd. | 4,577 | 76,509 | ||||||
HDFC Bank Ltd.–ADR | 3,150 | 301,801 | ||||||
Housing Development Finance Corp. Ltd. | 1,566 | 44,051 | ||||||
ICICI Bank Ltd.–ADR | 19,438 | 165,419 | ||||||
Infosys Ltd.–ADR | 7,822 | 138,215 | ||||||
Tata Consultancy Services Ltd. | 560 | 29,575 | ||||||
UPL Ltd. | 13,145 | 143,159 | ||||||
Zee Entertainment Enterprises Ltd. | 8,852 | 77,832 | ||||||
1,033,783 | ||||||||
Indonesia–0.06% | ||||||||
PT Bank Negara Indonesia (Persero) Tbk | 131,000 | 75,436 | ||||||
PT Telekomunikasi Indonesia Persero Tbk | 29,200 | 7,979 | ||||||
83,415 |
Shares | Value | |||||||
Ireland–0.12% | ||||||||
Kingspan Group PLC | 3,019 | $ | 136,406 | |||||
UDG Healthcare PLC | 2,467 | 31,001 | ||||||
167,407 | ||||||||
Italy–0.71% | ||||||||
A2A S.p.A. | 10,600 | 21,279 | ||||||
Banco BPM S.p.A.(a) | 42,085 | 152,725 | ||||||
Eni S.p.A. | 8,524 | 166,358 | ||||||
Intesa Sanpaolo S.p.A. | 103,678 | 394,195 | ||||||
Iren S.p.A. | 7,260 | 22,061 | ||||||
Telecom Italia S.p.A.(a) | 228,610 | 225,101 | ||||||
981,719 | ||||||||
Japan–0.35% | ||||||||
INPEX Corp. | 3,000 | 38,423 | ||||||
Mitsubishi Estate Co., Ltd. | 2,700 | 49,458 | ||||||
NEXON Co., Ltd.(a) | 5,500 | 80,145 | ||||||
Sumitomo Mitsui Financial Group, Inc. | 3,500 | 145,269 | ||||||
Toyota Motor Corp. | 2,500 | 163,757 | ||||||
477,052 | ||||||||
Jersey–0.08% | ||||||||
Randgold Resources Ltd. | 1,292 | 104,615 | ||||||
Luxembourg–0.01% | ||||||||
RTL Group S.A. | 226 | 18,590 | ||||||
Malaysia–0.01% | ||||||||
British American Tobacco Malaysia Bhd. | 1,400 | 8,742 | ||||||
Malta–0.02% | ||||||||
Kindred Group PLC–SDR | 2,251 | 29,165 | ||||||
Mexico–0.13% | ||||||||
Fibra Uno Administracion S.A. de C.V. | 111,400 | 184,555 | ||||||
Netherlands–0.88% | ||||||||
ASM International N.V. | 612 | 36,587 | ||||||
ASR Nederland N.V. | 669 | 31,545 | ||||||
BE Semiconductor Industries N.V. | 287 | 19,804 | ||||||
Heineken Holding N.V. | 441 | 44,681 | ||||||
ING Groep N.V. | 21,796 | 365,699 | ||||||
Koninklijke Ahold Delhaize N.V. | 20,786 | 501,137 | ||||||
Koninklijke DSM N.V. | 429 | 44,273 | ||||||
Philips Lighting N.V. | 475 | 14,436 | ||||||
SBM Offshore N.V. | 5,466 | 91,546 | ||||||
Wolters Kluwer N.V. | 1,095 | 59,084 | ||||||
1,208,792 | ||||||||
Norway–0.65% | ||||||||
Orkla ASA | 5,755 | 53,204 | ||||||
SalMar ASA | 787 | 36,633 | ||||||
Statoil ASA | 22,556 | 577,847 | ||||||
Telenor ASA | 5,692 | 125,898 | ||||||
TGS NOPEC Geophysical Co. ASA | 1,264 | 39,934 | ||||||
Yara International ASA | 1,437 | 60,357 | ||||||
893,873 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
6 Invesco Global Targeted Returns Fund
Shares | Value | |||||||
Philippines–0.03% | ||||||||
Robinsons Retail Holdings, Inc. | 24,140 | $ | 42,456 | |||||
Russia–0.06% | ||||||||
Evraz PLC | 6,607 | 41,576 | ||||||
Sberbank of Russia PJSC–ADR | 3,168 | 46,833 | ||||||
88,409 | ||||||||
Singapore–0.21% | ||||||||
DBS Group Holdings Ltd. | 4,400 | 101,653 | ||||||
Parkway Life REIT | 4,600 | 9,658 | ||||||
United Overseas Bank Ltd. | 7,800 | 176,193 | ||||||
287,504 | ||||||||
South Africa–0.04% | ||||||||
Naspers Ltd.–Class N | 225 | 54,896 | ||||||
South Korea–1.56% | ||||||||
E-MART Inc. | 135 | 33,994 | ||||||
Hyundai Motor Co. | 922 | 137,922 | ||||||
Hyundai Motor Co.–Preference Shares | 1,466 | 157,656 | ||||||
Hyundai Steel Co. | 650 | 36,794 | ||||||
Kangwon Land, Inc. | 1,467 | 39,695 | ||||||
KB Financial Group Inc. | 2,887 | 164,632 | ||||||
Korea Electric Power Corp. | 5,560 | 194,955 | ||||||
Korea Investment Holdings Co., Ltd. | 209 | 17,644 | ||||||
LG Chem Ltd. | 91 | 30,383 | ||||||
LG Corp. | 1,514 | 114,361 | ||||||
LG Uplus Corp. | 1,280 | 14,663 | ||||||
POSCO | 429 | 147,577 | ||||||
Samsung Electronics Co., Ltd. | 245 | 607,884 | ||||||
Samsung Electronics Co., Ltd.–Preference Shares | 139 | 276,556 | ||||||
Samsung Fire & Marine Insurance Co., Ltd. | 197 | 49,265 | ||||||
Shinhan Financial Group Co., Ltd. | 2,997 | 132,987 | ||||||
2,156,968 | ||||||||
Spain–0.65% | ||||||||
Amadeus IT Group S.A. | 1,774 | 129,292 | ||||||
Atresmedia Corp. de Medios de Comunicación, S.A. | 5,347 | 50,150 | ||||||
Banco Bilbao Vizcaya Argentaria, S.A. | 14,153 | 114,646 | ||||||
Banco Santander S.A. | 11,420 | 73,639 | ||||||
Bankia S.A. | 25,320 | 111,158 | ||||||
CaixaBank S.A. | 51,913 | 252,357 | ||||||
Industria de Diseno Textil, S.A. | 1,817 | 56,287 | ||||||
Mediaset Espana Comunicacion S.A. | 3,807 | 36,412 | ||||||
Merlin Properties SOCIMI, S.A. | 3,328 | 51,347 | ||||||
Obrascon Huarte Lain, S.A.(a) | 5,431 | 25,339 | ||||||
900,627 | ||||||||
Sweden–0.41% | ||||||||
Autoliv, Inc. | 331 | 44,371 | ||||||
Electrolux AB–Series B | 3,607 | 94,828 | ||||||
Loomis AB–Class B | 601 | 21,940 | ||||||
Lundin Petroleum AB(a) | 1,983 | 54,768 |
Shares | Value | |||||||
Sweden–(continued) | ||||||||
Sandvik AB | 5,220 | $ | 88,810 | |||||
SSAB AB–Class A | 4,348 | 24,431 | ||||||
SSAB AB–Class B | 10,931 | 49,132 | ||||||
Svenska Cellulosa AB SCA–Class B | 7,900 | 87,672 | ||||||
Swedish Match AB | 2,232 | 99,767 | ||||||
565,719 | ||||||||
Switzerland–1.90% | ||||||||
Adecco Group AG | 2,798 | 185,193 | ||||||
Barry Callebaut AG | 19 | 34,124 | ||||||
Bucher Industries AG | 63 | 23,049 | ||||||
Coca-Cola HBC AG | 1,890 | 63,480 | ||||||
Flughafen Zürich AG | 140 | 29,213 | ||||||
Georg Fischer AG | 38 | 47,207 | ||||||
Glencore PLC | 55,829 | 268,757 | ||||||
Logitech International S.A. | 3,120 | 115,253 | ||||||
Novartis AG | 6,367 | 489,725 | ||||||
Roche Holding AG | 2,829 | 627,647 | ||||||
SGS S.A. | 51 | 123,704 | ||||||
Sika AG | 11 | 79,721 | ||||||
Swisscom AG | 261 | 125,165 | ||||||
UBS Group AG | 10,740 | 180,447 | ||||||
VAT Group AG–REGS(b) | 166 | 24,464 | ||||||
Zurich Insurance Group AG | 626 | 199,688 | ||||||
2,616,837 | ||||||||
Taiwan–0.81% | ||||||||
Asustek Computer Inc. | 6,000 | 56,176 | ||||||
China Life Insurance Co., Ltd. | 22,170 | 24,023 | ||||||
Delta Electronics Inc. | 9,000 | 32,603 | ||||||
Gigabyte Technology Co., Ltd. | 8,000 | 17,426 | ||||||
Hon Hai Precision Industry Co., Ltd. | 47,000 | 130,754 | ||||||
MediaTek Inc. | 11,000 | 125,192 | ||||||
Quanta Computer Inc. | 13,000 | 23,630 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd.–ADR | 14,087 | 541,645 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 22,000 | 166,666 | ||||||
Yageo Corp. | 1 | 15 | ||||||
1,118,130 | ||||||||
Thailand–0.11% | ||||||||
Bangkok Bank PCL–NVDR | 6,500 | 39,592 | ||||||
Bangkok Bank PCL | 15,500 | 98,761 | ||||||
CPN Retail Growth Leasehold REIT | 19,700 | 14,102 | ||||||
152,455 | ||||||||
United Kingdom–13.63% | ||||||||
Anglo American PLC | 4,031 | 94,598 | ||||||
AstraZeneca PLC | 4,866 | 341,131 | ||||||
Aviva PLC | 98,929 | 719,133 | ||||||
Babcock International Group PLC | 24,129 | 243,858 | ||||||
BAE Systems PLC | 104,956 | 880,707 | ||||||
Balfour Beatty PLC | 27,932 | 112,880 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
7 Invesco Global Targeted Returns Fund
Shares | Value | |||||||
United Kingdom–(continued) | ||||||||
Barclays PLC | 262,899 | $ | 750,052 | |||||
Barratt Developments PLC | 13,453 | 103,167 | ||||||
Beazley PLC | 28,982 | 235,989 | ||||||
Bellway PLC | 1,317 | 59,838 | ||||||
BP PLC | 214,422 | �� | 1,584,113 | |||||
British American Tobacco PLC | 12,297 | 675,712 | ||||||
British Land Co. PLC (The) | 19,853 | 182,971 | ||||||
BT Group PLC | 205,217 | 702,575 | ||||||
BTG PLC(a) | 21,135 | 198,448 | ||||||
Bunzl PLC | 6,072 | 175,791 | ||||||
Capita PLC | 21,533 | 56,586 | ||||||
Dairy Crest Group PLC | 12,232 | 91,153 | ||||||
Derwent London PLC | 4,799 | 210,508 | ||||||
easyJet PLC | 26,485 | 576,802 | ||||||
Electrocomponents PLC | 4,499 | 37,632 | ||||||
Essentra PLC | 13,504 | 81,980 | ||||||
esure Group PLC | 19,641 | 60,863 | ||||||
Experian PLC | 984 | 22,463 | ||||||
Fiat Chrysler Automobiles N.V.(a) | 2,859 | 63,718 | ||||||
G4S PLC | 103,297 | 367,165 | ||||||
GlaxoSmithKline PLC | 16,929 | 339,687 | ||||||
Hays PLC | 11,311 | 27,839 | ||||||
Hiscox Ltd. | 16,004 | 327,009 | ||||||
Howden Joinery Group PLC | 3,059 | 20,074 | ||||||
HSBC Holdings PLC | 9,200 | 91,841 | ||||||
Imperial Brands PLC | 7,357 | 262,679 | ||||||
Indivior PLC(a) | 6,568 | 40,621 | ||||||
InterContinental Hotels Group PLC | 1,328 | 83,706 | ||||||
International Consolidated Airlines Group, S.A. | 14,371 | 123,706 | ||||||
International Consolidated Airlines Group, S.A. | 27,788 | 239,783 | ||||||
Intertek Group PLC | 1,126 | 75,575 | ||||||
J D Wetherspoon PLC | 5,032 | 80,446 | ||||||
J Sainsbury PLC | 123,131 | 521,684 | ||||||
Lancashire Holdings Ltd. | 13,663 | 112,099 | ||||||
Legal & General Group PLC | 214,309 | 794,790 | ||||||
Marks & Spencer Group PLC | 83,773 | 330,457 | ||||||
N Brown Group PLC | 20,699 | 58,299 | ||||||
NewRiver REIT PLC | 38,958 | 155,526 | ||||||
Next PLC | 6,212 | 447,524 | ||||||
PageGroup PLC | 3,027 | 22,304 | ||||||
Pearson PLC | 7,580 | 86,646 | ||||||
Persimmon PLC | 3,387 | 126,588 | ||||||
Provident Financial PLC(a) | 16,395 | 150,086 | ||||||
RELX PLC | 17,918 | 382,722 | ||||||
Rentokil Initial PLC | 55,128 | 232,370 | ||||||
Rightmove PLC | 811 | 50,886 | ||||||
Rolls-Royce Holdings PLC | 34,654 | 398,706 | ||||||
Rolls-Royce Holdings PLC–Preference | 2,459,227 | 3,385 | ||||||
Royal Bank of Scotland Group PLC (The)(a) | 67,820 | 251,782 |
Shares | Value | |||||||
United Kingdom–(continued) | ||||||||
Royal Dutch Shell PLC–Class A | 33,635 | $ | 1,168,989 | |||||
Royal Dutch Shell PLC–Class A | 12,737 | 445,532 | ||||||
Royal Dutch Shell PLC–Class B | 7,346 | 262,394 | ||||||
Royal Mail PLC | 12,923 | 103,202 | ||||||
RSA Insurance Group PLC | 26,610 | 240,496 | ||||||
Smith & Nephew PLC | 3,372 | 64,677 | ||||||
SSE PLC | 7,251 | 137,599 | ||||||
SSP Group PLC | 2,186 | 19,588 | ||||||
Stagecoach Group PLC | 29,677 | 63,559 | ||||||
Standard Chartered PLC | 7,163 | 75,446 | ||||||
TalkTalk Telecom Group PLC | 77,292 | 136,206 | ||||||
Tesco PLC | 121,978 | 396,111 | ||||||
Thomas Cook Group PLC | 175,739 | 298,536 | ||||||
TP ICAP PLC | 17,382 | 112,517 | ||||||
Vectura Group PLC(a) | 37,778 | 42,144 | ||||||
Victrex PLC | 482 | 17,330 | ||||||
Vodafone Group PLC | 190,413 | 553,994 | ||||||
WH Smith PLC | 1,011 | 27,109 | ||||||
William Hill PLC | 13,199 | 53,201 | ||||||
Wm Morrison Supermarkets PLC | 27,822 | 92,953 | ||||||
18,780,236 | ||||||||
United States–3.65% | ||||||||
Allergan PLC | 470 | 72,216 | ||||||
Altria Group, Inc. | 4,432 | 248,680 | ||||||
American Express Co. | 1,444 | 142,595 | ||||||
Amgen Inc. | 553 | 96,487 | ||||||
Aon PLC | 788 | 112,266 | ||||||
Apache Corp. | 1,873 | 76,699 | ||||||
Baker Hughes, a GE Co. | 3,203 | 115,660 | ||||||
Berkshire Hathaway Inc.–Class B(a) | 611 | 118,369 | ||||||
Biogen Inc.(a) | 223 | 61,013 | ||||||
Booking Holdings Inc.(a) | 32 | 69,696 | ||||||
Broadcom Inc. | 499 | 114,481 | ||||||
Carnival PLC | 1,992 | 128,724 | ||||||
Chevron Corp. | 2,386 | 298,512 | ||||||
Citigroup Inc. | 4,434 | 302,709 | ||||||
eBay Inc.(a) | 2,934 | 111,140 | ||||||
First Republic Bank | 2,788 | 258,922 | ||||||
Gilead Sciences, Inc. | 2,423 | 175,013 | ||||||
JPMorgan Chase & Co. | 3,296 | 358,539 | ||||||
Las Vegas Sands Corp. | 2,998 | 219,843 | ||||||
Markel Corp.(a) | 77 | 87,013 | ||||||
Mastercard Inc.–Class A | 239 | 42,607 | ||||||
Microsoft Corp. | 1,530 | 143,086 | ||||||
Nasdaq, Inc. | 2,527 | 223,185 | ||||||
National Oilwell Varco Inc. | 3,944 | 152,515 | ||||||
Newmont Mining Corp. | 1,390 | 54,613 | ||||||
Nielsen Holdings PLC | 4,583 | 144,135 | ||||||
Pfizer Inc. | 6,118 | 223,980 | ||||||
Samsonite International S.A. | 12,000 | 54,214 | ||||||
TE Connectivity Ltd. | 1,384 | 126,982 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
8 Invesco Global Targeted Returns Fund
Shares | Value | |||||||
United States–(continued) | ||||||||
Union Pacific Corp. | 815 | $ | 108,908 | |||||
United Rentals, Inc.(a) | 328 | 49,200 | ||||||
United Technologies Corp. | 2,061 | 247,629 | ||||||
Wells Fargo & Co. | 4,176 | 216,985 | ||||||
Williams-Sonoma, Inc. | 1,439 | 68,784 | ||||||
5,025,400 | ||||||||
Zambia–0.09% | ||||||||
First Quantum Minerals Ltd. | 8,435 | 121,560 | ||||||
Total Common Stocks & Other Equity Interests |
| 49,515,983 | ||||||
Principal Amount | ||||||||
Non-U.S. Dollar Denominated Bonds & |
| |||||||
Australia–0.09% | ||||||||
Origin Energy Finance Ltd., REGS, Unsec. Sub. Gtd. Euro Bonds, 4.00%, 09/16/2074(b) | EUR | 100,000 | 125,849 | |||||
Belgium–0.10% | ||||||||
Solvay Finance S.A., REGS, Jr. Unsec. Sub. Gtd. Euro Bonds, 5.87%(b)(d) | EUR | 100,000 | 142,864 | |||||
Canada–0.02% | ||||||||
Parkland Fuel Corp., Sr. Unsec. Gtd. Notes, 5.63%, 05/09/2025 | CAD | 40,000 | 31,433 | |||||
France–0.58% | ||||||||
Burger King France S.A.S., Sr. Sec. Gtd. Floating Rate Bonds, | EUR | 100,000 | 122,853 | |||||
La Financière ATALIAN S.A.S, Sr. Unsec. Notes, 6.63%, 05/15/2025(b) | GBP | 100,000 | 139,570 | |||||
Orange S.A., REGS, Jr. Unsec. Sub. Euro Notes, 5.88%(b)(d) | GBP | 100,000 | 153,222 | |||||
Picard Groupe S.A.S., Sr. Sec. Gtd. Floating Rate Notes, | EUR | 100,000 | 120,515 | |||||
TOTAL S.A., REGS, Jr. Unsec. Sub. Medium-Term Euro Notes, 2.25%(b)(d) | EUR | 100,000 | 124,918 | |||||
Électricité de France S.A., REGS, Jr. Unsec. Sub. Medium-Term Euro Notes, 5.88%(b)(d) | GBP | 100,000 | 140,474 | |||||
801,552 | ||||||||
Germany–0.27% | ||||||||
CBR Fashion Finance B.V., Sr. Sec. Gtd. Bonds, 5.13%, 10/01/2022(b) | EUR | 100,000 | 106,258 | |||||
Deutsche Bank AG, REGS, Jr. Unsec. Sub. Euro Notes, 7.13%(b)(d) | GBP | 100,000 | 136,291 | |||||
Unitymedia Hessen GmbH & Co. KG/Unitymedia NRW GmbH, REGS, Sr. Sec. Gtd. First Lien Euro Bonds, 4.63%, 02/15/2026(b) | EUR | 100,000 | 133,107 | |||||
375,656 |
Principal Amount | Value | |||||||
Israel–0.09% | ||||||||
Teva Pharmaceutical Finance Netherlands II B.V., Sr. Unsec. Gtd. Notes, 4.50%, 03/01/2025(b) | EUR | 100,000 | $ | 122,782 | ||||
Italy–5.89% | ||||||||
Italy Buoni Poliennali Del Tesoro, Sr. Unsec. Euro Bonds, 1.25%, 12/01/2026 | EUR | 55,000 | 64,921 | |||||
Unsec. Euro Bonds, 2.00%, 02/01/2028 | EUR | 3,050,000 | 3,758,146 | |||||
Unsec. Euro Bonds, 2.20%, 06/01/2027 | EUR | 3,118,000 | 3,938,766 | |||||
Mercury Bondco PLC, Sr. Sec. Gtd. First Lien PIK Bonds, 7.88% PIK Rate, 7.13% Cash Rate, | EUR | 100,000 | 125,235 | |||||
Pro-Gest S.p.A., Sr. Unsec. Bonds, 3.25%, 12/15/2024(b) | EUR | 100,000 | 118,303 | |||||
Wind Tre S.p.A., Sr. Sec. Gtd. Floating Rate First Lien Notes, 2.75% (3 mo. EURIBOR + 2.75%), 01/20/2024(b)(e) | EUR | 100,000 | 112,352 | |||||
8,117,723 | ||||||||
Japan–0.08% | ||||||||
SoftBank Group Corp., REGS, Sr. Unsec. Gtd. Euro Notes, 3.13%, 09/19/2025(b) | EUR | 100,000 | 112,156 | |||||
Mexico–3.36% | ||||||||
Mexican Bonos, Series M, | ||||||||
6.50%, 06/09/2022 | MXN | 43,100,000 | 2,235,637 | |||||
7.50%, 06/03/2027 | MXN | 1,500,000 | 80,343 | |||||
8.00%, 12/07/2023 | MXN | 40,400,000 | 2,225,189 | |||||
Petróleos Mexicanos, REGS, Sr. Unsec. Gtd. Medium-Term Euro Notes, 8.25%, 06/02/2022(b) | GBP | 50,000 | 83,798 | |||||
4,624,967 | ||||||||
Netherlands–0.26% | ||||||||
Constellium N.V., Sr. Unsec. Notes, 4.25%, 02/15/2026(b) | EUR | 100,000 | 122,572 | |||||
HEMA Bondco I B.V., Sr. Sec. Gtd. Floating Rate First Lien Notes, 6.25% (3 mo. EURIBOR + 6.25%), 07/15/2022(b)(e) | EUR | 100,000 | 121,304 | |||||
UPC Holding B.V., REGS, Sr. Sec. First Lien Euro Bonds, 3.88%, 06/15/2029(b) | EUR | 100,000 | 115,015 | |||||
358,891 | ||||||||
Poland–2.95% | ||||||||
Republic of Poland Government Bond, Series 0726, Unsec. Bonds, | ||||||||
2.50%, 07/25/2026 | PLN | 14,306,000 | 3,945,422 | |||||
Series 0727, Unsec. Bonds, | ||||||||
2.50%, 07/25/2027 | PLN | 440,000 | 119,965 | |||||
4,065,387 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
9 Invesco Global Targeted Returns Fund
Principal Amount | Value | |||||||
Portugal–0.06% | ||||||||
Portugal Obrigações do Tesouro, REGS, Sr. Unsec. Euro Bonds, 2.88%, 10/15/2025(b) | EUR | 60,000 | $ | 81,472 | ||||
South Africa–0.13% | ||||||||
Republic of South Africa Government Bond, Series 2048, Unsec. Bonds, 8.75%, 02/28/2048 | ZAR | 2,300,000 | 178,938 | |||||
Spain–0.39% | ||||||||
Caixabank S.A., REGS, Jr. Unsec. Sub. Euro Bonds, 6.75%(b)(d) | EUR | 200,000 | 271,746 | |||||
Naviera Armas, S.A., Sr. Sec. Gtd. Floating Rate Bonds, 6.50% (3 mo. EURIBOR + 6.50%), 07/31/2023(b)(e) | EUR | 100,000 | 127,945 | |||||
Spain Government Bond, REGS, Sr. Unsec. Euro Bonds, 1.95%, 04/30/2026(b) | EUR | 55,000 | 71,390 | |||||
Spain Government Inflation Linked Bond, REGS, Sr. Unsec. Euro Bonds, 0.55%, 11/30/2019(b) | EUR | 50,000 | 62,997 | |||||
534,078 | ||||||||
Switzerland–0.20% | ||||||||
ELM B.V. for Swiss Reinsurance Co. Ltd., REGS, Jr. Unsec. Sub. Medium-Term Euro Notes, 6.30%(b)(d) | GBP | 100,000 | 143,472 | |||||
LafargeHolcim Sterling Finance (Netherlands) B.V., REGS, Sr. Unsec. Gtd. Medium-Term Euro Notes, 3.00%, 05/12/2032(b) | GBP | 100,000 | 132,491 | |||||
275,963 | ||||||||
United Kingdom–3.55% | ||||||||
AA Bond Co. Ltd., REGS, Sec. Second Lien Euro Notes, 5.50%, 07/31/2043(b) | GBP | 100,000 | 130,096 | |||||
B.A.T. International Finance PLC, REGS, Sr. Unsec. Gtd. Medium-Term Euro Notes, 2.25%, 09/09/2052(b) | GBP | 100,000 | 108,145 | |||||
Barclays Bank PLC, Series RCI, REGS, Jr. Unsec. Sub. Euro Bonds, | GBP | 150,000 | 231,873 | |||||
Boparan Finance PLC, REGS, Sr. Sec. Gtd. First Lien Euro Notes, 5.50%, 07/15/2021(b) | GBP | 100,000 | 131,344 | |||||
BP Capital Markets PLC, REGS, Sr. Unsec. Gtd. Medium-Term Euro Notes, 1.18%, 08/12/2023(b) | GBP | 100,000 | 134,208 | |||||
Centrica PLC, REGS, Jr. Unsec. Sub. Euro Bonds, 5.25%, 04/10/2075(b) | GBP | 100,000 | 146,514 | |||||
CYBG PLC, REGS, Unsec. Sub. Euro Bonds, 5.00%, 02/09/2026(b) | GBP | 100,000 | 143,191 | |||||
Ei Group PLC, Sr. Sec. First Mortgage Euro Bonds, 6.50%, 12/06/2018 | GBP | 50,000 | 70,106 | |||||
Fidelity International Ltd., REGS, Sr. Unsec. Medium-Term Euro Notes, 6.75%, 10/19/2020(b) | GBP | 50,000 | 77,080 |
Principal Amount | Value | |||||||
United Kingdom–(continued) | ||||||||
HBOS Capital Funding L.P., REGS, Jr. Unsec. Sub. Gtd. Euro Notes, | GBP | 100,000 | $ | 141,199 | ||||
Heathrow Finance PLC, REGS, Sr. Sec. First Lien Euro Notes, 5.75%, 03/03/2025(b) | GBP | 100,000 | 150,978 | |||||
InterContinental Hotels Group PLC, REGS, Sr. Unsec. Gtd. Medium-Term Euro Notes, 2.13%, 08/24/2026(b) | GBP | 100,000 | 131,227 | |||||
Jaguar Land Rover Automotive PLC, REGS, Sr. Unsec. Gtd. Euro Notes, 3.88%, 03/01/2023(b) | GBP | 100,000 | 138,715 | |||||
John Lewis PLC, REGS, Sr. Unsec. Euro Bonds, 4.25%, 12/18/2034(b) | GBP | 100,000 | 141,967 | |||||
Lloyds Banking Group PLC, REGS, Jr. Unsec. Sub. Euro Bonds, 7.88%(b)(d) | GBP | 200,000 | 333,825 | |||||
Marks & Spencer PLC, REGS, Sr. Unsec. Medium-Term Euro Notes, 4.75%, 06/12/2025(b) | GBP | 100,000 | 151,138 | |||||
Matalan Finance PLC, Sr. Sec. First Lien Bonds, 6.75%, 01/31/2023(b) | GBP | 100,000 | 128,007 | |||||
Nationwide Building Society, REGS, Jr. Unsec. Sub. Bonds, 10.25%(b)(d) | GBP | 68,000 | 147,785 | |||||
NatWest Markets PLC, Series 352, Jr. Unsec. Sub. Medium-Term Euro Notes, 6.20%(d) | GBP | 13,000 | 19,788 | |||||
New Look Secured Issuer PLC, REGS, Sr. Sec. Gtd. First Lien Euro Bonds, 6.50%, 07/01/2022(b) | GBP | 100,000 | 62,879 | |||||
Next PLC, REGS, Sr. Unsec. Euro Bonds, 3.63%, 05/18/2028(b) | GBP | 100,000 | 138,725 | |||||
Ocado Group PLC, Sr. Sec. Gtd. Notes, 4.00%, 06/15/2024(b) | GBP | 100,000 | 136,662 | |||||
Phoenix Group Holdings, REGS, Sr. Unsec. Euro Bonds, 5.75%, 07/07/2021(b) | GBP | 100,000 | 153,694 | |||||
RAC Bond Co. PLC, REGS, Sr. Sec. Gtd. First Lien Medium-Term Euro Notes, 4.87%, 05/06/2026(b) | GBP | 100,000 | 144,963 | |||||
RL Finance Bonds No. 3 PLC, REGS, Unsec. Gtd. Sub. Euro Bonds, 6.13%, 11/13/2028(b) | GBP | 100,000 | 159,134 | |||||
Rothesay Life PLC, REGS, Unsec. Sub. Euro Bonds, 8.00%, 10/30/2025(b) | GBP | 100,000 | 167,976 | |||||
Royal Bank of Scotland Group PLC (The), REGS, Jr. Unsec. Sub. Variable Rate Euro Notes, 2.00% (3 mo. EURIBOR + 2.33%)(b)(d)(e) | EUR | 100,000 | 120,275 | |||||
SSE PLC, REGS, Jr. Unsec. Sub. Euro Bonds, 3.88%(b)(d) | GBP | 100,000 | 142,311 | |||||
Tesco Property Finance 2 PLC, REGS, Sr. Sec. First Lien Mortgage-Backed Euro Bonds, 6.05%, 10/13/2039(b) | GBP | 43,549 | 71,895 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
10 Invesco Global Targeted Returns Fund
Principal Amount | Value | |||||||
United Kingdom–(continued) | ||||||||
Thames Water Utilities Cayman Finance Ltd., REGS, Sr. Sec. Gtd. First Lien Medium-Term Euro Notes, 1.88%, 01/24/2024(b) | GBP | 100,000 | $ | 134,165 | ||||
Travis Perkins PLC, REGS, Sr. Unsec. Gtd. Euro Bonds, 4.50%, 09/07/2023(b) | GBP | 100,000 | 142,992 | |||||
United Kingdom Gilt Inflation-Linked, REGS, Unsec. Bonds, 0.13%, 03/22/2026(b) | GBP | 60,000 | 94,807 | |||||
Virgin Media Secured Finance PLC, REGS, Sr. Sec. Gtd. First Lien Euro Notes, 6.25%, 03/28/2029(b) | GBP | 100,000 | 145,923 | |||||
Vodafone Group PLC, REGS, Sr. Unsec. Medium-Term Euro Notes, 3.38%, 08/08/2049(b) | GBP | 100,000 | 127,342 | |||||
Whitbread Group PLC, REGS, Sr. Unsec. Gtd. Euro Bonds, 3.38%, 10/16/2025(b) | GBP | 100,000 | 139,448 | |||||
Yorkshire Building Society (The), REGS, Sr. Unsec. Medium-Term Euro Notes, 3.50%, 04/21/2026(b) | GBP | 100,000 | 147,253 | |||||
4,887,630 | ||||||||
United States–0.25% | ||||||||
AT&T Inc., Sr. Unsec. Euro Bonds, 3.55%, 09/14/2037 | GBP | 100,000 | 139,133 | |||||
Johnson & Johnson, Sr. Unsec. Global Notes, 5.50%, 11/06/2024 | GBP | 50,000 | 85,329 | |||||
Netflix, Inc., Sr. Unsec. Notes, 3.63%, 05/15/2027(b) | EUR | 100,000 | 120,328 | |||||
344,790 | ||||||||
Total Non-U.S. Dollar Denominated Bonds & Notes |
| 25,182,131 | ||||||
U.S. Dollar Denominated Bonds & Notes–10.01% |
| |||||||
Argentina–0.11% | ||||||||
Transportadora de Gas del Sur S.A., Sr. Unsec. Notes, 6.75%, 05/02/2025(b) | $ | 150,000 | 150,075 | |||||
Australia–0.01% | ||||||||
Nufarm Australia Ltd./Nufarm Americas Inc., Sr. Unsec. Gtd. Notes, 5.75%, 04/30/2026 (b) | 16,000 | 15,980 | ||||||
Belgium–0.07% | ||||||||
Anheuser-Busch InBev Finance, Inc., Sr. Unsec. Gtd. Global Notes, 3.70%, 02/01/2024 | 100,000 | 100,403 | ||||||
Brazil–0.21% | ||||||||
JBS USA Lux S.A./JBS USA Finance, Inc., REGS, Sr. Unsec. Gtd. Euro Notes, 5.75%, 06/15/2025(b) | 45,000 | 42,512 | ||||||
MARB BondCo PLC, Sr. Unsec. Gtd. Notes, 7.00%, 03/15/2024(b) | 200,000 | 191,502 |
Principal Amount | Value | |||||||
Brazil–(continued) | ||||||||
Petrobras Global Finance B.V., | ||||||||
Sr. Unsec. Gtd. Global Notes, | ||||||||
5.75%, 02/01/2029 | $ | 28,000 | $ | 26,614 | ||||
8.75%, 05/23/2026 | 25,000 | 29,425 | ||||||
290,053 | ||||||||
Canada–0.34% | ||||||||
1011778 BC ULC/ New Red Finance, Inc., Sec. Gtd. Second Lien Notes, 5.00%, 10/15/2025(b) | 99,000 | 95,752 | ||||||
Air Canada, Sr. Unsec. Gtd. Notes, 7.75%, 04/15/2021(b) | 25,000 | 27,469 | ||||||
Bombardier Inc., | ||||||||
Sr. Unsec. Notes, | ||||||||
6.13%, 01/15/2023(b) | 65,000 | 65,731 | ||||||
7.50%, 03/15/2025(b) | 18,000 | 18,810 | ||||||
Cott Holdings Inc., Sr. Unsec. Gtd. Notes, 5.50%, 04/01/2025(b) | 50,000 | 49,750 | ||||||
HudBay Minerals, Inc., Sr. Unsec. Gtd. Notes, 7.63%, 01/15/2025(b) | 31,000 | 32,986 | ||||||
Mercer International Inc., | ||||||||
Sr. Unsec. Global Notes, | ||||||||
6.50%, 02/01/2024 | 15,000 | 15,638 | ||||||
Sr. Unsec. Notes, | ||||||||
5.50%, 01/15/2026(b) | 10,000 | 9,850 | ||||||
Parkland Fuel Corp., Sr. Unsec. Notes, 6.00%, 04/01/2026 (b) | 23,000 | 23,058 | ||||||
Precision Drilling Corp., Sr. Unsec. Gtd. Global Notes, | ||||||||
5.25%, 11/15/2024 | 65,000 | 61,568 | ||||||
6.50%, 12/15/2021 | 11,000 | 11,275 | ||||||
Teck Resources Ltd., | ||||||||
Sr. Unsec. Gtd. Global Notes, | ||||||||
4.75%, 01/15/2022 | 25,000 | 25,484 | ||||||
Sr. Unsec. Notes, | ||||||||
6.13%, 10/01/2035 | 33,000 | 35,227 | ||||||
472,598 | ||||||||
France–0.38% | ||||||||
AXA S.A., Series A, Jr. Unsec. Sub. Notes, 6.46%(b)(d) | 100,000 | 100,750 | ||||||
BNP Paribas S.A., REGS, Jr. Unsec. Sub. Euro Notes, 7.38%(b)(d) | 200,000 | 218,250 | ||||||
Societe Generale S.A., Unsec. Sub. Notes, 4.25%, 04/14/2025(b) | 200,000 | 196,508 | ||||||
515,508 | ||||||||
Germany–0.13% | ||||||||
Allianz S.E., REGS, Series DIP, Jr. Unsec. Sub. Medium-Term Euro Notes, 3.88%(b)(d) | 200,000 | 178,625 | ||||||
Israel–0.03% | ||||||||
Teva Pharmaceutical Finance IV, B.V., Sr. Unsec. Gtd. Global Notes, 3.65%, 11/10/2021 | 25,000 | 23,266 | ||||||
Teva Pharmaceutical Finance Netherlands III B.V., Sr. Unsec. Gtd. Notes, 6.00%, 04/15/2024(b) | 19,000 | 18,452 | ||||||
41,718 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
11 Invesco Global Targeted Returns Fund
Principal Amount | Value | |||||||
Italy–0.17% | ||||||||
Telecom Italia Capital S.A., | ||||||||
Sr. Unsec. Gtd. Global Notes, | ||||||||
6.38%, 11/15/2033 | $ | 7,000 | $ | 7,643 | ||||
7.20%, 07/18/2036 | 16,000 | 18,440 | ||||||
Telecom Italia S.p.A., Sr. Unsec. Notes, 5.30%, 05/30/2024(b) | 200,000 | 204,450 | ||||||
230,533 | ||||||||
Luxembourg–0.21% | ||||||||
Altice Financing S.A., Sr. Sec. Gtd. First Lien Bonds, 7.50%, 05/15/2026(b) | 200,000 | 197,000 | ||||||
Intelsat Jackson Holdings S.A., | ||||||||
Sr. Unsec. Gtd. Global Bonds, | ||||||||
5.50%, 08/01/2023 | 22,000 | 18,507 | ||||||
Sr. Unsec. Gtd. Global Notes, | ||||||||
7.25%, 10/15/2020 | 51,000 | 50,044 | ||||||
7.50%, 04/01/2021 | 29,000 | 27,586 | ||||||
293,137 | ||||||||
Mexico–0.13% | ||||||||
Fomento Economico Mexicano S.A.B. de C.V., Sr. Unsec. Global Notes, 2.88%, 05/10/2023 | 150,000 | 144,643 | ||||||
Petróleos Mexicanos, Sr. Unsec. Gtd. Notes, 5.35%, 02/12/2028(b) | 29,000 | 27,735 | ||||||
172,378 | ||||||||
Spain–0.11% | ||||||||
Telefónica Emisiones, S.A.U., Sr. Unsec. Gtd. Global Notes, 4.90%, 03/06/2048 | 150,000 | 148,889 | ||||||
Switzerland–0.15% | ||||||||
Cloverie PLC for Zurich Insurance Co. Ltd., REGS, Unsec. Sub. Medium-Term Euro Notes, 5.63%, 06/24/2046(b) | 200,000 | 207,700 | ||||||
United Kingdom–0.46% | ||||||||
HSBC Holdings PLC, Jr. Unsec. Sub. Global Bonds, 6.00%(d) | 200,000 | 198,040 | ||||||
Noble Holding International Ltd., Sr. Unsec. Gtd. Global Notes, 7.75%, 01/15/2024 | 28,000 | 26,390 | ||||||
Royal Bank of Scotland Group PLC (The), | ||||||||
Jr. Unsec. Sub. Bonds, 7.50%(d) | 200,000 | 210,550 | ||||||
Unsec. Sub. Global Bonds, | ||||||||
5.13%, 05/28/2024 | 100,000 | 101,654 | ||||||
Series U, Jr. Unsec. Sub. Variable Rate Global Notes, 4.62% (3 mo. USD LIBOR + 2.32%)(d)(e) | 100,000 | 101,250 | ||||||
637,884 | ||||||||
United States–7.46% | ||||||||
AES Corp. (The), Sr. Unsec. Notes, 5.50%, 04/15/2025 | 85,000 | 87,337 | ||||||
Aircastle Ltd., | ||||||||
Sr. Unsec. Global Notes, | ||||||||
7.63%, 04/15/2020 | 10,000 | 10,738 | ||||||
Sr. Unsec. Notes, | ||||||||
5.00%, 04/01/2023 | 13,000 | 13,390 |
Principal Amount | Value | |||||||
United States–(continued) | ||||||||
Albertsons Cos. LLC/ Safeway Inc./New Albertson’s, Inc./Albertson’s LLC, Sr. Unsec. Gtd. Global Notes, 6.63%, 06/15/2024 | $ | 47,000 | $ | 44,062 | ||||
Ally Financial Inc., | ||||||||
Sr. Unsec. Global Notes, | ||||||||
4.63%, 05/19/2022 | 25,000 | 25,219 | ||||||
Sr. Unsec. Gtd. Global Notes, | ||||||||
8.00%, 03/15/2020 | 30,000 | 32,400 | ||||||
AMC Entertainment Holdings, Inc., | ||||||||
Sr. Unsec. Gtd. Sub. Global Notes, | ||||||||
5.75%, 06/15/2025 | 70,000 | 68,162 | ||||||
5.88%, 11/15/2026 | 30,000 | 29,288 | ||||||
AMC Networks Inc., Sr. Unsec. Gtd. Global Notes, 5.00%, 04/01/2024 | 60,000 | 58,800 | ||||||
AmeriGas Partners, L.P./AmeriGas Finance Corp., Sr. Unsec. Global Notes, 5.88%, 08/20/2026 | 75,000 | 74,812 | ||||||
Antero Resources Corp., Sr. Unsec. Gtd. Global Notes, 5.63%, 06/01/2023 | 48,000 | 49,260 | ||||||
Apple Inc., Sr. Unsec. Global Notes, 3.45%, 02/09/2045 | 50,000 | 44,694 | ||||||
Aramark Services, Inc., Sr. Unsec. Gtd. Notes, 5.00%, 04/01/2025(b) | 30,000 | 30,263 | ||||||
Archrock Partners, L.P./Archrock Partners Finance Corp., Sr. Unsec. Gtd. Global Notes, 6.00%, 10/01/2022 | 15,000 | 15,075 | ||||||
Ascent Resources—Utica, LLC /ARU Finance Corp., Sr. Unsec. Notes, 10.00%, 04/01/2022(b) | 30,000 | 32,400 | ||||||
Ashland LLC, Sr. Unsec. Gtd. Global Notes, 4.75%, 08/15/2022 | 60,000 | 60,675 | ||||||
Ashton Woods USA LLC/Ashton Woods Finance Co., Sr. Unsec. Notes, | ||||||||
6.75%, 08/01/2025(b) | 24,000 | 23,280 | ||||||
6.88%, 02/15/2021(b) | 36,000 | 36,090 | ||||||
Avis Budget Car Rental LLC/Avis Budget Finance Inc., Sr. Unsec. Gtd. Notes, 5.25%, 03/15/2025(b) | 18,000 | 17,393 | ||||||
B&G Foods, Inc., Sr. Unsec. Gtd. Notes, 5.25%, 04/01/2025 | 22,000 | 20,185 | ||||||
Ball Corp., | ||||||||
Sr. Unsec. Gtd. Global Bonds, | ||||||||
4.00%, 11/15/2023 | 50,000 | 49,187 | ||||||
Sr. Unsec. Gtd. Global Notes, | ||||||||
5.25%, 07/01/2025 | 60,000 | 62,025 | ||||||
Bank of America Corp., Series M, Jr. Unsec. Sub. Bonds, 8.13%(d) | 100,000 | 100,325 | ||||||
BBA U.S. Holdings, Inc., Sr. Unsec. Notes, 5.38%, 05/01/2026(b) | 12,000 | 12,097 | ||||||
Beazer Homes USA, Inc., Sr. Unsec. Gtd. Global Notes, | ||||||||
5.88%, 10/15/2027 | 6,000 | 5,520 | ||||||
6.75%, 03/15/2025 | 40,000 | 39,500 | ||||||
8.75%, 03/15/2022 | 25,000 | 27,063 | ||||||
BMC East, LLC, Sr. Sec. Gtd. First Lien Notes, 5.50%, 10/01/2024(b) | 50,000 | 49,687 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
12 Invesco Global Targeted Returns Fund
Principal Amount | Value | |||||||
United States–(continued) | ||||||||
Booking Holdings Inc., Sr. Unsec. Global Notes, 3.60%, 06/01/2026 | $ | 100,000 | $ | 97,008 | ||||
Boyd Gaming Corp., Sr. Unsec. Gtd. Global Notes, 6.38%, 04/01/2026 | 40,000 | 41,979 | ||||||
Brink’s Co. (The), Sr. Unsec. Gtd. Notes, 4.63%, 10/15/2027(b) | 62,000 | 57,195 | ||||||
Callon Petroleum Co., Sr. Unsec. Gtd. Global Notes, 6.13%, 10/01/2024 | 60,000 | 61,500 | ||||||
Calpine Corp., Sr. Unsec. Global Notes, 5.38%, 01/15/2023 | 25,000 | 24,063 | ||||||
Carrols Restaurant Group, Inc., Sec. Gtd. Second Lien Global Notes, 8.00%, 05/01/2022 | 13,000 | 13,569 | ||||||
CB Escrow Corp., Sr. Unsec. Notes, 8.00%, 10/15/2025 (b) | 6,000 | 5,730 | ||||||
CCO Holdings LLC/CCO Holdings Capital Corp., | ||||||||
Sr. Unsec. Global Notes, | ||||||||
5.75%, 09/01/2023 | 20,000 | 20,300 | ||||||
Sr. Unsec. Notes, | ||||||||
5.13%, 05/01/2027(b) | 100,000 | 93,947 | ||||||
5.75%, 02/15/2026(b) | 110,000 | 109,450 | ||||||
CDW LLC/CDW Finance Corp., Sr. Unsec. Gtd. Notes, 5.00%, 09/01/2025 | 15,000 | 15,033 | ||||||
CenturyLink, Inc., | ||||||||
Series S, Sr. Unsec. Notes, | ||||||||
6.45%, 06/15/2021 | 38,000 | 39,021 | ||||||
Series Y, Sr. Unsec. Global Notes, | ||||||||
7.50%, 04/01/2024 | 30,000 | 30,675 | ||||||
Charles River Laboratories International, Inc., Sr. Unsec. Notes, 5.50%, 04/01/2026(b) | 9,000 | 9,177 | ||||||
Chemours Co. (The), Sr. Unsec. Gtd. Global Notes, 7.00%, 05/15/2025 | 65,000 | 70,281 | ||||||
Cincinnati Bell Inc., Sr. Unsec. Gtd. Notes, 7.00%, 07/15/2024(b) | 40,000 | 36,896 | ||||||
CIT Group Inc., | ||||||||
Sr. Unsec. Global Notes, | ||||||||
5.00%, 08/01/2023 | 53,000 | 53,927 | ||||||
Unsec. Sub. Global Notes, | ||||||||
6.13%, 03/09/2028 | 6,000 | 6,218 | ||||||
Clear Channel Worldwide Holdings, Inc., | ||||||||
Series B, Sr. Unsec. Gtd. Global Notes, | ||||||||
6.50%, 11/15/2022 | 50,000 | 51,437 | ||||||
Sr. Unsec. Gtd. Sub. Global Notes, | ||||||||
7.63%, 03/15/2020 | 30,000 | 30,188 | ||||||
Cleaver-Brooks, Inc., Sr. Sec. Notes, 7.88%, 03/01/2023(b) | 52,000 | 53,820 | ||||||
Cleveland-Cliffs Inc., Sr. Unsec. Gtd. Notes, 5.75%, 03/01/2025(b) | 40,000 | 38,725 | ||||||
CommScope Technologies LLC, Sr. Unsec. Gtd. Notes, 6.00%, 06/15/2025(b) | 55,000 | 56,925 | ||||||
Community Health Systems, Inc., | ||||||||
Sr. Sec. Gtd. First Lien Global Notes, | ||||||||
5.13%, 08/01/2021 | 40,000 | 37,000 | ||||||
Sr. Sec. Gtd. First Lien Notes, | ||||||||
6.25%, 03/31/2023 | 38,000 | 34,746 |
Principal Amount | Value | |||||||
United States–(continued) | ||||||||
Continental Resources Inc., Sr. Unsec. Gtd. Global Notes, 3.80%, 06/01/2024 | $ | 40,000 | $ | 39,150 | ||||
Core & Main LP, Sr. Unsec. Notes, 6.13%, 08/15/2025(b) | 40,000 | 39,400 | ||||||
Coty Inc., Sr. Unsec. Notes, 6.50%, 04/15/2026(b) | 70,000 | 68,250 | ||||||
Crown Americas LLC/Crown Americas Capital Corp. V, Sr. Unsec. Gtd. Global Notes, 4.25%, 09/30/2026 | 20,000 | 18,550 | ||||||
CSC Holdings LLC, Sr. Unsec. Global Notes, 6.75%, 11/15/2021 | 121,000 | 127,655 | ||||||
CyrusOne L.P./CyrusOne Finance Corp., | ||||||||
Sr. Unsec. Gtd. Global Notes, | ||||||||
5.00%, 03/15/2024 | 10,000 | 10,050 | ||||||
5.38%, 03/15/2027 | 50,000 | 50,125 | ||||||
Dana Inc., Sr. Unsec. Notes, 5.50%, 12/15/2024 | 60,000 | 61,350 | ||||||
DaVita Inc., Sr. Unsec. Gtd. Global Notes, 5.00%, 05/01/2025 | 10,000 | 9,502 | ||||||
Dell International LLC/ EMC Corp., | ||||||||
Sr. Sec. Gtd. First Lien Notes, | ||||||||
8.35%, 07/15/2046(b) | 10,000 | 12,321 | ||||||
Sr. Unsec. Gtd. Notes, | ||||||||
7.13%, 06/15/2024(b) | 85,000 | 90,606 | ||||||
Delphi Technologies PLC, Sr. Unsec. Gtd. Notes, 5.00%, 10/01/2025(b) | 27,000 | 26,038 | ||||||
Diebold Nixdorf, Inc., Sr. Unsec. Gtd. Global Notes, 8.50%, 04/15/2024 | 29,000 | 30,196 | ||||||
Discover Financial Services, Inc., Series C, Jr. Unsec. Sub. Global Notes, 5.50%(d) | 21,000 | 20,606 | ||||||
DISH DBS Corp., Sr. Unsec. Gtd. Global Notes, | ||||||||
5.88%, 11/15/2024 | 146,000 | 125,377 | ||||||
7.88%, 09/01/2019 | 25,000 | 25,910 | ||||||
Eagle Holding Co. II, LLC, Sr. Unsec. PIK Notes, 8.38% PIK Rate, 7.63% Cash Rate, 05/15/2022(b)(f) | 45,000 | 45,675 | ||||||
Encompass Health Corp., Sr. Unsec. Gtd. Global Notes, 5.75%, 09/15/2025 | 65,000 | 66,787 | ||||||
Energy Transfer Equity, L.P., Sr. Sec. First Lien Notes, 5.88%, 01/15/2024 | 54,000 | 55,282 | ||||||
Energy Transfer Partners, L.P., Series A, Jr. Unsec. Sub. Global Notes, 6.25%(d) | 24,000 | 22,912 | ||||||
EnerSys, Sr. Unsec. Gtd. Notes, 5.00%, 04/30/2023(b) | 60,000 | 60,525 | ||||||
Ensco PLC, Sr. Unsec. Global Notes, | ||||||||
4.50%, 10/01/2024 | 3,000 | 2,453 | ||||||
7.75%, 02/01/2026 | 31,000 | 29,256 | ||||||
Entegris Inc., Sr. Unsec. Gtd. Notes, 4.63%, 02/10/2026(b) | 15,000 | 14,550 | ||||||
Envision Healthcare Corp., Sr. Unsec. Gtd. Notes, 6.25%, 12/01/2024(b) | 12,000 | 12,540 | ||||||
EP Energy LLC/Everest Acquisition Finance Inc., Sr. Sec. Gtd. First Lien Notes, 8.00%, 11/29/2024(b) | 60,000 | 62,400 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
13 Invesco Global Targeted Returns Fund
Principal Amount | Value | |||||||
United States–(continued) | ||||||||
Equinix Inc., Sr. Unsec. Notes, 5.88%, 01/15/2026 | $ | 85,000 | $ | 88,187 | ||||
Ferrellgas L.P./Ferrellgas Finance Corp., Sr. Unsec. Global Notes, 6.50%, 05/01/2021 | 25,000 | 24,063 | ||||||
First Data Corp., Sr. Unsec. Gtd. Notes, 7.00%, 12/01/2023(b) | 106,000 | 111,181 | ||||||
Flexi-Van Leasing, Inc., Sec. Second Lien Notes, 10.00%, 02/15/2023(b) | 9,000 | 8,978 | ||||||
Freeport-McMoRan Inc., Sr. Unsec. Gtd. Global Notes, 5.40%, 11/14/2034 | 59,000 | 54,722 | ||||||
Frontier Communications Corp., Sr. Unsec. Global Notes, | ||||||||
10.50%, 09/15/2022 | 51,000 | 45,087 | ||||||
11.00%, 09/15/2025 | 27,000 | 20,858 | ||||||
Gulfport Energy Corp., Sr. Unsec. Gtd. Global Notes, 6.00%, 10/15/2024 | 65,000 | 62,075 | ||||||
H&E Equipment Services, Inc., Sr. Unsec. Gtd. Global Notes, 5.63%, 09/01/2025 | 55,000 | 55,412 | ||||||
Hanesbrands Inc., Sr. Unsec. Gtd. Notes, 4.63%, 05/15/2024(b) | 100,000 | 96,750 | ||||||
HCA, Inc., | ||||||||
Sr. Sec. Gtd. First Lien Notes, | ||||||||
5.25%, 04/15/2025 | 116,000 | 117,740 | ||||||
Sr. Unsec. Gtd. Notes, | ||||||||
5.88%, 02/15/2026 | 85,000 | 86,275 | ||||||
Heartland Dental, LLC, Sr. Unsec. Notes, 8.50%, 05/01/2026(b) | 28,000 | 28,133 | ||||||
Herc Rentals Inc., Sec. Gtd. Second Lien Notes, 7.75%, 06/01/2024(b) | 41,000 | 44,434 | ||||||
Hertz Corp. (The), Sec. Gtd. Second Lien Notes, 7.63%, 06/01/2022(b) | 112,000 | 114,240 | ||||||
Hewlett Packard Enterprise Co., Sr. Unsec. Global Notes, 4.90%, 10/15/2025 | 50,000 | 51,448 | ||||||
Hill-Rom Holdings, Inc., Sr. Unsec. Gtd. Notes, 5.00%, 02/15/2025(b) | 39,000 | 38,923 | ||||||
Hillman Group Inc. (The), Sr. Unsec. Gtd. Notes, 6.38%, 07/15/2022(b) | 53,000 | 51,547 | ||||||
Holly Energy Partners L.P./Holly Energy Finance Corp., Sr. Unsec. Gtd. Notes, 6.00%, 08/01/2024(b) | 30,000 | 30,225 | ||||||
Hot Topic, Inc., Sr. Sec. Gtd. First Lien Notes, 9.25%, 06/15/2021(b) | 60,000 | 59,250 | ||||||
HUB International Ltd., Sr. Unsec. Notes, 7.00%, 05/01/2026(b) | 12,000 | 12,060 | ||||||
Hughes Satellite Systems Corp., | ||||||||
Sr. Sec. Gtd. First Lien Global Notes, | ||||||||
5.25%, 08/01/2026 | 35,000 | 34,344 | ||||||
Sr. Unsec. Gtd. Global Notes, | ||||||||
7.63%, 06/15/2021 | 50,000 | 53,812 | ||||||
Ingles Markets, Inc., Sr. Unsec. Global Notes, 5.75%, 06/15/2023 | 64,000 | 64,160 | ||||||
IRB Holding Corp., Sr. Unsec. Gtd. Notes, 6.75%, 02/15/2026(b) | 35,000 | 33,863 | ||||||
Iron Mountain Inc., Sr. Unsec. Gtd. Notes, 6.00%, 08/15/2023 | 127,000 | 131,445 |
Principal Amount | Value | |||||||
United States–(continued) | ||||||||
Iron Mountain US Holdings, Inc., Sr. Unsec. Gtd. Notes, 5.38%, 06/01/2026(b) | $ | 35,000 | $ | 33,950 | ||||
Itron, Inc., Sr. Unsec. Gtd. Notes, 5.00%, 01/15/2026(b) | 27,000 | 26,452 | ||||||
J.C. Penney Corp., Inc., | ||||||||
Sec. Gtd. Second Lien Notes, | ||||||||
8.63%, 03/15/2025(b) | 50,000 | 46,469 | ||||||
Sr. Unsec. Gtd. Deb., | ||||||||
7.40%, 04/01/2037 | 50,000 | 33,250 | ||||||
Sr. Unsec. Gtd. Notes, | ||||||||
6.38%, 10/15/2036 | 50,000 | 31,500 | ||||||
J.B. Poindexter & Co., Inc., Sr. Unsec. Bonds, 7.13%, 04/15/2026(b) | 58,000 | 59,305 | ||||||
Jagged Peak Energy LLC, Sr. Unsec. Gtd. Notes, 5.88%, 05/01/2026(b) | 17,000 | 17,096 | ||||||
Jaguar Holding Co. II/Pharmaceutical Product Development, LLC, Sr. Unsec. Gtd. Notes, 6.38%, 08/01/2023(b) | 15,000 | 15,225 | ||||||
KB Home, Sr. Unsec. Gtd. Notes, 7.50%, 09/15/2022 | 23,000 | 25,358 | ||||||
Kenan Advantage Group Inc. (The), Sr. Unsec. Notes, 7.88%, 07/31/2023(b) | 60,000 | 61,200 | ||||||
KFC Holding Co./Pizza Hut Holdings LLC/Taco Bell of America LLC, Sr. Unsec. Gtd. Notes, 4.75%, 06/01/2027(b) | 16,000 | 15,420 | ||||||
Koppers Inc., Sr. Unsec. Gtd. Notes, 6.00%, 02/15/2025(b) | 35,000 | 35,700 | ||||||
Kraton Polymers LLC/Kraton Polymers Capital Corp., Sr. Unsec. Gtd. Notes, 10.50%, 04/15/2023(b) | 40,000 | 44,350 | ||||||
L Brands, Inc., Sr. Unsec. Gtd. Global Notes, | ||||||||
5.63%, 02/15/2022 | 20,000 | 20,852 | ||||||
6.88%, 11/01/2035 | 30,000 | 28,500 | ||||||
Lamar Media Corp., Sr. Unsec. Gtd. Global Notes, 5.75%, 02/01/2026 | 60,000 | 62,062 | ||||||
Lamb Weston Holdings, Inc., Sr. Unsec. Gtd. Notes, 4.63%, 11/01/2024(b) | 60,000 | 59,775 | ||||||
Lennar Corp., | ||||||||
Sr. Unsec. Gtd. Global Notes, | ||||||||
4.75%, 11/15/2022 | 50,000 | 50,241 | ||||||
Sr. Unsec. Gtd. Notes, | ||||||||
5.25%, 06/01/2026(b) | 23,000 | 22,715 | ||||||
Level 3 Financing, Inc., Sr. Unsec. Gtd. Global Notes, 5.25%, 03/15/2026 | 65,000 | 63,030 | ||||||
Levi Strauss & Co., Sr. Unsec. Global Notes, 5.00%, 05/01/2025 | 50,000 | 50,500 | ||||||
LifePoint Health, Inc., Sr. Unsec. Gtd. Global Notes, 5.38%, 05/01/2024 | 60,000 | 57,375 | ||||||
Lithia Motors, Inc., Sr. Unsec. Gtd. Notes, 5.25%, 08/01/2025(b) | 17,000 | 16,873 | ||||||
LPL Holdings Inc., Sr. Unsec. Gtd. Notes, 5.75%, 09/15/2025(b) | 32,000 | 31,120 | ||||||
Mattel, Inc., | ||||||||
Sr. Unsec. Global Notes, | ||||||||
5.45%, 11/01/2041 | 13,000 | 10,595 | ||||||
Sr. Unsec. Gtd. Notes, | ||||||||
6.75%, 12/31/2025(b) | 53,000 | 51,733 | ||||||
Sr. Unsec. Notes, | ||||||||
6.20%, 10/01/2040 | 7,000 | 5,968 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
14 Invesco Global Targeted Returns Fund
Principal Amount | Value | |||||||
United States–(continued) | ||||||||
MEDNAX, Inc., Sr. Unsec. Gtd. Notes, 5.25%, 12/01/2023(b) | $ | 25,000 | $ | 24,875 | ||||
Meredith Corp., Sr. Unsec. Notes, 6.88%, 02/01/2026(b) | 53,000 | 53,795 | ||||||
Meritage Homes Corp., Sr. Unsec. Gtd. Global Notes, 6.00%, 06/01/2025 | 21,000 | 21,761 | ||||||
Meritor Inc., Sr. Unsec. Gtd. Notes, 6.25%, 02/15/2024 | 60,000 | 61,987 | ||||||
MGM Resorts International, Sr. Unsec. Gtd. Notes, 4.63%, 09/01/2026 | 60,000 | 57,075 | ||||||
Microsoft Corp., Sr. Unsec. Global Bonds, 2.40%, 08/08/2026 | 80,000 | 73,540 | ||||||
Molina Healthcare, Inc., Sr. Unsec. Gtd. Notes, 4.88%, 06/15/2025(b) | 24,000 | 22,920 | ||||||
MPH Acquisition Holdings LLC, Sr. Unsec. Gtd. Notes, 7.13%, 06/01/2024(b) | 60,000 | 61,225 | ||||||
MPT Operating Partnership L.P./MPT Finance Corp., Sr. Unsec. Gtd. Global Notes, 5.00%, 10/15/2027 | 50,000 | 47,500 | ||||||
MSCI Inc., Sr. Unsec. Gtd. Notes, 5.75%, 08/15/2025(b) | 50,000 | 52,390 | ||||||
Mueller Industries, Inc., Unsec. Sub. Deb., 6.00%, 03/01/2027 | 25,000 | 24,938 | ||||||
Murphy Oil USA, Inc., Sr. Unsec. Gtd. Global Notes, 5.63%, 05/01/2027 | 52,000 | 51,935 | ||||||
Navient Corp., Sr. Unsec. Medium-Term Notes, | ||||||||
7.25%, 01/25/2022 | 25,000 | 26,531 | ||||||
8.00%, 03/25/2020 | 45,000 | 48,037 | ||||||
Netflix, Inc., Sr. Unsec. Global Notes, 5.75%, 03/01/2024 | 33,000 | 34,279 | ||||||
Newfield Exploration Co., Sr. Unsec. Global Notes, 5.63%, 07/01/2024 | 48,000 | 51,120 | ||||||
NGPL PipeCo. LLC, Sr. Unsec. Bonds, 4.88%, 08/15/2027(b) | 7,000 | 6,832 | ||||||
Novelis Corp., Sr. Unsec. Gtd. Notes, | ||||||||
5.88%, 09/30/2026(b) | 4,000 | 3,980 | ||||||
6.25%, 08/15/2024(b) | 50,000 | 51,062 | ||||||
NRG Energy, Inc., Sr. Unsec. Gtd. Global Notes, 6.63%, 01/15/2027 | 32,000 | 33,120 | ||||||
Oasis Petroleum Inc., Sr. Unsec. Gtd. Global Notes, 6.88%, 01/15/2023 | 60,000 | 61,800 | ||||||
OI European Group B.V., Sr. Unsec. Gtd. Notes, 4.00%, 03/15/2023(b) | 9,000 | 8,573 | ||||||
Oshkosh Corp., Sr. Unsec. Gtd. Global Notes, 5.38%, 03/01/2025 | 30,000 | 31,125 | ||||||
Parsley Energy LLC/Parsley Finance Corp., Sr. Unsec. Gtd. Notes, 6.25%, 06/01/2024(b) | 65,000 | 68,087 | ||||||
Penske Automotive Group Inc., Sr. Unsec. Sub. Gtd. Notes, 5.50%, 05/15/2026 | 43,000 | 41,818 | ||||||
Pisces Midco, Inc., Sr. Sec. Notes, 8.00%, 04/15/2026(b) | 10,000 | 10,053 | ||||||
Plains All American Pipeline, L.P., Series B, Jr. Unsec. Sub. Notes, 6.13%(d) | 25,000 | 24,344 |
Principal Amount | Value | |||||||
United States–(continued) | ||||||||
Plastipak Holdings Inc., Sr. Unsec. Notes, 6.25%, 10/15/2025(b) | $ | 34,000 | $ | 33,150 | ||||
Platform Specialty Products Corp., Sr. Unsec. Gtd. Notes, 5.88%, 12/01/2025(b) | 49,000 | 47,836 | ||||||
PolyOne Corp., Sr. Unsec. Global Notes, 5.25%, 03/15/2023 | 50,000 | 51,437 | ||||||
Prime Security Services Borrower, LLC/Prime Finance, Inc., Sec. Gtd. Second Lien Notes, 9.25%, 05/15/2023(b) | 74,000 | 79,642 | ||||||
QEP Resources, Inc., | ||||||||
Sr. Unsec. Global Notes, | ||||||||
5.63%, 03/01/2026 | 13,000 | 12,496 | ||||||
Sr. Unsec. Notes, | ||||||||
6.88%, 03/01/2021 | 60,000 | 64,800 | ||||||
Rackspace Hosting, Inc., Sr. Unsec. Gtd. Notes, 8.63%, 11/15/2024(b) | 20,000 | 20,325 | ||||||
Range Resources Corp., Sr. Unsec. Gtd. Global Notes, | ||||||||
4.88%, 05/15/2025 | 34,000 | 31,641 | ||||||
5.88%, 07/01/2022 | 29,000 | 29,508 | ||||||
Rayonier A.M. Products Inc., Sr. Unsec. Gtd. Notes, 5.50%, 06/01/2024(b) | 55,000 | 53,487 | ||||||
Reynolds Group Issuer Inc./LLC, Sr. Unsec. Gtd. Notes, 7.00%, 07/15/2024(b) | 80,000 | 83,450 | ||||||
RSP Permian, Inc., Sr. Unsec. Gtd. Global Notes, 5.25%, 01/15/2025 | 65,000 | 67,437 | ||||||
SBA Communications Corp., Sr. Unsec. Global Notes, 4.88%, 09/01/2024 | 65,000 | 62,644 | ||||||
Scientific Games International Inc., Sr. Unsec. Gtd. Global Notes, 10.00%, 12/01/2022 | 50,000 | 54,063 | ||||||
SemGroup Corp./ Rose Rock Finance Corp., Sr. Unsec. Gtd. Global Notes, 5.63%, 11/15/2023 | 30,000 | 28,425 | ||||||
ServiceMaster Co., LLC (The), Sr. Unsec. Gtd. Notes, 5.13%, 11/15/2024(b) | 90,000 | 87,885 | ||||||
SESI, L.L.C., Sr. Unsec. Gtd. Global Notes, 7.13%, 12/15/2021 | 61,000 | 62,144 | ||||||
Sirius XM Radio Inc., Sr. Unsec. Gtd. Notes, | ||||||||
5.38%, 07/15/2026(b) | 30,000 | 29,478 | ||||||
6.00%, 07/15/2024(b) | 34,000 | 35,016 | ||||||
Six Flags Entertainment Corp., Sr. Unsec. Gtd. Notes, 4.88%, 07/31/2024(b) | 35,000 | 34,213 | ||||||
SM Energy Co., Sr. Unsec. Global Notes, 6.13%, 11/15/2022 | 36,000 | 36,540 | ||||||
Southwestern Energy Co., Sr. Unsec. Gtd. Global Notes, | ||||||||
4.10%, 03/15/2022 | 55,000 | 53,625 | ||||||
7.50%, 04/01/2026 | 22,000 | 22,715 | ||||||
Spectrum Brands, Inc., Sr. Unsec. Gtd. Global Notes, 5.75%, 07/15/2025 | 60,000 | 60,243 | ||||||
Sprint Communications Inc., Sr. Unsec. Global Notes, 11.50%, 11/15/2021 | 40,000 | 48,000 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
15 Invesco Global Targeted Returns Fund
Principal Amount | Value | |||||||
United States–(continued) | ||||||||
Sprint Corp., Sr. Unsec. Gtd. Global Notes, | ||||||||
7.25%, 09/15/2021 | $ | 35,000 | $ | 37,188 | ||||
7.63%, 02/15/2025 | 6,000 | 6,330 | ||||||
7.88%, 09/15/2023 | 110,000 | 118,250 | ||||||
Standard Industries Inc., Sr. Unsec. Notes, 6.00%, 10/15/2025(b) | 57,000 | 59,422 | ||||||
Steel Dynamics, Inc., Sr. Unsec. Gtd. Global Notes, 5.00%, 12/15/2026 | 35,000 | 34,738 | ||||||
Suburban Propane Partners, L.P./Suburban Energy Finance Corp., Sr. Unsec. Global Notes, 5.50%, 06/01/2024 | 79,000 | 76,432 | ||||||
SunCoke Energy Partners, L.P./ SunCoke Energy Partners Finance Corp., Sr. Unsec. Gtd. Notes, | 30,000 | 30,975 | ||||||
Sunoco LP/Sunoco Finance Corp., Sr. Unsec. Gtd. Notes, | 22,000 | 21,713 | ||||||
Surgery Center Holdings, Inc., Sr. Unsec. Gtd. Notes, | ||||||||
6.75%, 07/01/2025(b) | 14,000 | 13,300 | ||||||
8.88%, 04/15/2021(b) | 7,000 | 7,228 | ||||||
T-Mobile USA, Inc., | ||||||||
Sr. Unsec. Gtd. Global Bonds, | ||||||||
6.50%, 01/15/2026 | 105,000 | 111,825 | ||||||
Sr. Unsec. Gtd. Notes, | ||||||||
6.00%, 04/15/2024 | 50,000 | 52,485 | ||||||
Targa Resources Partners L.P./Targa Resources Partners Finance Corp., | ||||||||
Sr. Unsec. Gtd. Global Bonds, | ||||||||
5.13%, 02/01/2025 | 34,000 | 33,065 | ||||||
Sr. Unsec. Gtd. Notes, | ||||||||
5.88%, 04/15/2026(b) | 15,000 | 14,944 | ||||||
Taylor Morrison Communities Inc./ Taylor Morrison Holdings II, Inc., Sr. Unsec. Gtd. Notes, 5.88%, 04/15/2023(b) | 30,000 | 30,825 | ||||||
Tenet Healthcare Corp., Sr. Unsec. Global Notes, | ||||||||
6.75%, 06/15/2023 | 75,000 | 74,016 | ||||||
8.13%, 04/01/2022 | 30,000 | 31,350 | ||||||
Terex Corp., Sr. Unsec. Gtd. Notes, 5.63%, 02/01/2025(b) | 65,000 | 64,756 | ||||||
Titan International, Inc., Sr. Sec. Gtd. First Lien Notes, 6.50%, 11/30/2023(b) | 57,000 | 57,980 | ||||||
TransDigm Inc., Sr. Unsec. Gtd. Sub. Global Notes, 6.50%, 05/15/2025 | 87,000 | 88,740 | ||||||
Transocean Inc., Sr. Unsec. Gtd. Global Notes, 7.50%, 04/15/2031 | 40,000 | 37,200 | ||||||
TreeHouse Foods, Inc., Sr. Unsec. Gtd. Notes, 6.00%, 02/15/2024(b) | 60,000 | 59,925 | ||||||
Tribune Media Co., Sr. Unsec. Gtd. Global Notes, 5.88%, 07/15/2022 | 60,000 | 61,050 | ||||||
Trinseo Materials Operating S.C.A./Trinseo Materials Finance, Inc., Sr. Unsec. Gtd. Notes, 5.38%, 09/01/2025(b) | 18,000 | 17,775 |
Principal Amount | Value | |||||||
United States–(continued) | ||||||||
United Rentals North America, Inc., | ||||||||
Sr. Unsec. Gtd. Global Notes, | ||||||||
5.50%, 07/15/2025 | $ | 75,000 | $ | 76,969 | ||||
Sr. Unsec. Gtd. Notes, | ||||||||
5.88%, 09/15/2026 | 12,000 | 12,555 | ||||||
United States Steel Corp., Sr. Unsec. Global Notes, 6.88%, 08/15/2025 | 58,000 | 59,450 | ||||||
US Foods, Inc., Sr. Unsec. Gtd. Notes, 5.88%, 06/15/2024(b) | 60,000 | 61,350 | ||||||
Valeant Pharmaceuticals International, Inc., | ||||||||
5.50%, 11/01/2025(b) | 21,000 | 20,974 | ||||||
Sr. Unsec. Gtd. Notes, | ||||||||
5.63%, 12/01/2021(b) | 60,000 | 58,275 | ||||||
6.13%, 04/15/2025(b) | 65,000 | 58,872 | ||||||
Valvoline Inc., Sr. Unsec. Gtd. Global Notes, 5.50%, 07/15/2024 | 60,000 | 61,650 | ||||||
Verizon Communications Inc., Sr. Unsec. Global Notes, 4.40%, 11/01/2034 | 50,000 | 48,414 | ||||||
VFH Parent LLC/Orchestra Co-Issuer Inc., Sec. Gtd. Second Lien Notes, 6.75%, 06/15/2022(b) | 12,000 | 12,476 | ||||||
Vistra Energy Corp., Sr. Unsec. Gtd. Global Notes, 7.38%, 11/01/2022 | 20,000 | 21,125 | ||||||
Wal-Mart Inc., Sr. Unsec. Notes, 2.65%, 12/15/2024 | 100,000 | 95,868 | ||||||
Walt Disney Co. (The), Sr. Unsec. Global Notes, 3.00%, 02/13/2026 | 50,000 | 48,205 | ||||||
Waste Pro USA, Inc., Sr. Unsec. Notes, 5.50%, 02/15/2026(b) | 15,000 | 14,883 | ||||||
Weatherford International Ltd., Sr. Unsec. Gtd. Notes, 6.50%, 08/01/2036 | 45,000 | 34,425 | ||||||
WellCare Health Plans Inc., Sr. Unsec. Notes, 5.25%, 04/01/2025 | 60,000 | 60,456 | ||||||
Western Digital Corp., Sr. Unsec. Gtd. Notes, 4.75%, 02/15/2026 | 60,000 | 59,250 | ||||||
Whiting Petroleum Corp., Sr. Unsec. Gtd. Global Notes, 6.25%, 04/01/2023 | 75,000 | 77,344 | ||||||
WildHorse Resource Development Corp., Sr. Unsec. Gtd. Global Notes, 6.88%, 02/01/2025 | 7,000 | 7,140 | ||||||
William Lyon Homes Inc., Sr. Unsec. Notes, 6.00%, 09/01/2023(b) | 8,000 | 8,018 | ||||||
Williams Cos., Inc. (The), | ||||||||
Sr. Unsec. Global Notes, | ||||||||
4.55%, 06/24/2024 | 40,000 | 40,050 | ||||||
Sr. Unsec. Notes, | ||||||||
7.88%, 09/01/2021 | 22,000 | 24,530 | ||||||
WPX Energy Inc., Sr. Unsec. Notes, 5.25%, 09/15/2024 | 65,000 | 65,812 | ||||||
Wrangler Buyer Corp., Sr. Unsec. Notes, 6.00%, 10/01/2025(b) | 8,000 | 7,920 | ||||||
Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp., REGS, Sr. Unsec. Gtd. Euro Notes, 5.25%, 05/15/2027(b) | 25,000 | 24,226 | ||||||
10,277,680 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
16 Invesco Global Targeted Returns Fund
Principal Amount | Value | |||||||
Zambia–0.04% | ||||||||
First Quantum Minerals Ltd., Sr. Unsec. Gtd. Notes, 7.00%, 02/15/2021(b) | $ | 60,000 | $ | 60,450 | ||||
Total U.S. Dollar Denominated Bonds & Notes |
| 13,793,611 | ||||||
U.S. Treasury Securities–0.55% |
| |||||||
U.S. Treasury Notes–0.42% | ||||||||
1.25%, 12/31/2018 | 486,900 | 484,009 | ||||||
1.63%, 05/15/2026 | 100,000 | 90,631 | ||||||
574,640 | ||||||||
U.S. Treasury Inflation — Indexed Notes–0.13% | ||||||||
0.13%, 04/15/2021 | 182,561 | (g) | 180,042 | |||||
Total U.S. Treasury Securities | 754,682 | |||||||
Shares | ||||||||
Preferred Stocks–0.04% |
| |||||||
United States–0.04% | ||||||||
CIT Group Inc., Series A, 5.80% Pfd. | 10,000 | 9,975 | ||||||
Wells Fargo & Co., Class A, Series L, $75.00 Conv. Pfd. | 30 | 38,418 | ||||||
Total Preferred Stocks | 48,393 |
Shares | Value | |||||||
Money Market Funds–20.56% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(h) | 7,786,347 | $ | 7,786,347 | |||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(h) | 6,180,300 | 6,180,918 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(h) | 8,898,682 | 8,898,682 | ||||||
STIC (Global Series) PLC–U.S. Dollar Liquidity Portfolio (Ireland)–Institutional Class, | 5,469,989 | 5,469,989 | ||||||
Total Money Market Funds | 28,335,936 | |||||||
Options Purchased–5.80% | ||||||||
(Cost $9,467,376) | 7,999,354 | |||||||
TOTAL INVESTMENTS IN | 125,630,090 | |||||||
OTHER ASSETS LESS LIABILITIES–8.84% | 12,176,923 | |||||||
NET ASSETS–100.00% | $ | 137,807,013 |
Investment Abbreviations:
ADR | – American Depositary Receipt | |
CAD | – Canadian Dollar | |
Conv. | – Convertible | |
Deb. | – Debentures | |
DIP | – Debtor-in-Possession | |
EUR | – Euro | |
EURIBOR | – Euro Interbank Offered Rate | |
GBP | – British Pound Sterling | |
Gtd. | – Guaranteed | |
Jr. | – Junior | |
LIBOR | – London Interbank Offered Rate | |
MXN | – Mexican Peso | |
NVDR | – Non-Voting Depositary Receipt | |
Pfd. | – Preferred | |
PIK | – Pay-in-Kind | |
PLN | – Poland Zloty | |
REGS | – Regulation S | |
REIT | – Real Estate Investment Trust | |
SDR | – Swedish Depositary Receipt | |
Sec. | – Secured | |
Sr. | – Senior | |
Sub. | – Subordinated | |
Unsec. | – Unsecured | |
USD | – U.S. Dollar | |
ZAR | – South African Rand |
Notes to Consolidated Schedule of Investments:
(a) | Non-income producing security. |
(b) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2018 was $14,394,493, which represented 10.45% of the Fund’s Net Assets. |
(c) | Foreign denominated security. Principal amount is denominated in the currency indicated. |
(d) | Perpetual bond with no specified maturity date. |
(e) | Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on April 30, 2018. |
(f) | All or a portion of this security is Pay-in-Kind. Pay-in-Kind securities pay interest income in the form of securities. |
(g) | Principal amount of security and interest payments are adjusted for inflation. See Note 1I. |
(h) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
17 Invesco Global Targeted Returns Fund
Open Over-The-Counter Index Options Purchased | ||||||||||||||||||||||||||
Description | Type of Contract | Broker/Counterparty | Expiration Date | Number of Contracts | Exercise Price | Notional Value(i) | Value | |||||||||||||||||||
CBOE SPX Volatility Index | Call | Barclays Bank PLC | 08/22/2018 | 419 | USD | 18 | USD | 754,200 | $ | 100,683 | ||||||||||||||||
CBOE SPX Volatility Index | Call | Barclays Bank PLC | 09/19/2018 | 424 | USD | 19 | USD | 805,600 | 104,940 | |||||||||||||||||
CBOE SPX Volatility Index | Call | Barclays Bank PLC | 10/17/2018 | 410 | USD | 18 | USD | 738,000 | 126,917 | |||||||||||||||||
CBOE SPX Volatility Index | Call | Morgan Stanley Capital Services LLC | 05/16/2018 | 353 | USD | 17 | USD | 600,100 | 42,373 | |||||||||||||||||
CBOE SPX Volatility Index | Call | Normuda International PLC | 05/16/2018 | 107 | USD | 17 | USD | 181,900 | 12,845 | |||||||||||||||||
EURO STOXX 50 Index | Call | Goldman Sachs International | 12/20/2019 | 41 | EUR | 3,400 | EUR | 1,394,000 | 115,505 | |||||||||||||||||
EURO STOXX 50 Index | Call | J.P. Morgan Securities LLC | 12/20/2019 | 103 | EUR | 3,350 | EUR | 3,450,500 | 322,594 | |||||||||||||||||
EURO STOXX 50 Index | Call | J.P. Morgan Securities LLC | 12/20/2019 | 144 | EUR | 3,400 | EUR | 4,896,000 | 405,677 | |||||||||||||||||
EURO STOXX 50 Index | Call | UBS | 12/20/2019 | 103 | EUR | 3,350 | EUR | 3,450,500 | 322,594 | |||||||||||||||||
FTSE 100 Index | Call | Barclays Bank PLC | 09/21/2018 | 220 | GBP | 7,400 | GBP | 8,140,000 | 628,999 | |||||||||||||||||
FTSE 100 Index | Call | Societe Generale | 09/21/2018 | 110 | GBP | 7,150 | GBP | 7,865,000 | 569,335 | |||||||||||||||||
FTSE 100 Index | Call | Societe Generale | 09/21/2018 | 110 | GBP | 7,400 | GBP | 8,140,000 | 314,500 | |||||||||||||||||
FTSE 100 Index | Call | Societe Generale | 09/21/2018 | 162 | GBP | 7,650 | GBP | 12,393,000 | 203,078 | |||||||||||||||||
FTSE 100 Index | Call | Societe Generale | 09/21/2018 | 156 | GBP | 7,725 | GBP | 12,051,000 | 145,622 | |||||||||||||||||
FTSE 100 Index | Call | Societe Generale | 12/21/2018 | 5 | GBP | 7,100 | GBP | 355,000 | 28,034 | |||||||||||||||||
FTSE 100 Index | Call | UBS | 12/21/2018 | 15 | GBP | 7,100 | GBP | 1,065,000 | 84,103 | |||||||||||||||||
Hang Seng China Enterprise Index | Call | J.P. Morgan Securities LLC | 12/28/2018 | 55 | HKD | 11,200 | HKD | 30,800,000 | 462,791 | |||||||||||||||||
Hang Seng China Enterprise Index | Call | J.P. Morgan Securities LLC | 12/28/2018 | 5 | HKD | 12,400 | HKD | 3,100,000 | 20,804 | |||||||||||||||||
Hang Seng China Enterprise Index | Call | J.P. Morgan Chase Bank, N.A. | 12/28/2018 | 21 | HKD | 11,200 | HKD | 11,760,000 | 176,702 | |||||||||||||||||
Hang Seng China Enterprise Index | Call | Societe Generale | 12/28/2018 | 83 | HKD | 11,200 | HKD | 35,280,000 | 698,394 | |||||||||||||||||
Hang Seng China Enterprise Index | Call | UBS | 12/28/2018 | 56 | HKD | 11,200 | HKD | 22,400,000 | 471,205 | |||||||||||||||||
Nikkei 225 Index | Call | BNP Paribas S.A. | 12/14/2018 | 2 | JPY | 21,750 | JPY | 43,500,000 | 26,560 | |||||||||||||||||
Nikkei 225 Index | Call | UBS | 12/14/2018 | 45 | JPY | 22,750 | JPY | 1,023,750,000 | 377,880 | |||||||||||||||||
S&P 500 Index | Call | Bank of America Merrill Lynch | 07/20/2018 | 78 | USD | 2,740 | USD | 21,372,000 | 208,692 | |||||||||||||||||
S&P 500 Index | Call | Bank of America Merrill Lynch | 07/20/2018 | 78 | USD | 2,775 | USD | 21,645,000 | 126,090 | |||||||||||||||||
S&P 500 Index | Call | Deutsche Bank Securities Inc. | 09/21/2018 | 36 | USD | 3,300 | USD | 11,880,000 | 445 | |||||||||||||||||
Subtotal — Over-The-Counter Index Call Options Purchased | 3,341 | 6,097,362 | ||||||||||||||||||||||||
CBOE SPX Volatility Index | Put | Barclays Bank PLC | 05/16/2018 | 419 | USD | 17 | USD | 712,300 | 69,118 | |||||||||||||||||
CBOE SPX Volatility Index | Put | Barclays Bank PLC | 06/20/2018 | 419 | USD | 17 | USD | 712,300 | 87,990 | |||||||||||||||||
CBOE SPX Volatility Index | Put | Barclays Bank PLC | 07/18/2018 | 410 | USD | 17 | USD | 697,000 | 90,199 | |||||||||||||||||
FTSE 100 Index | Put | Barclays Bank PLC | 06/15/2018 | 26 | GBP | 7,150 | GBP | 1,501,500 | 11,553 | |||||||||||||||||
FTSE 100 Index | Put | Citigroup Global Markets Inc. | 06/15/2018 | 29 | GBP | 7,150 | GBP | 2,073,500 | 12,886 | |||||||||||||||||
FTSE 100 Index | Put | Deutsche Bank Securities Inc. | 06/15/2018 | 43 | GBP | 7,150 | GBP | 3,074,500 | 19,107 | |||||||||||||||||
FTSE 100 Index | Put | Deutsche Bank Securities Inc. | 06/15/2018 | 16 | GBP | 7,400 | GBP | 1,184,000 | 17,899 | |||||||||||||||||
FTSE 100 Index | Put | HSBC New York | 06/15/2018 | 11 | GBP | 7,150 | GBP | 786,500 | 4,888 | |||||||||||||||||
FTSE 100 Index | Put | J.P. Morgan Chase Bank, N.A. | 06/15/2018 | 25 | GBP | 7,150 | GBP | 1,787,500 | 11,109 | |||||||||||||||||
FTSE 100 Index | Put | Societe Generale | 09/21/2018 | 55 | GBP | 6,800 | GBP | 3,740,000 | 56,450 | |||||||||||||||||
FTSE 100 Index | Put | Societe Generale | 12/21/2018 | 7 | GBP | 6,600 | GBP | 462,000 | 11,028 | |||||||||||||||||
FTSE 100 Index | Put | UBS | 06/15/2018 | 19 | GBP | 7,150 | GBP | 1,358,500 | 8,443 | |||||||||||||||||
FTSE 100 Index | Put | UBS | 12/21/2018 | 16 | GBP | 6,600 | GBP | 1,056,000 | 25,207 | |||||||||||||||||
Hang Seng China Enterprise Index | Put | Deutsche Bank Securities Inc. | 12/28/2018 | 16 | HKD | 10,000 | HKD | 8,000,000 | 20,386 | |||||||||||||||||
Hang Seng China Enterprise Index | Put | Deutsche Bank Securities Inc. | 12/28/2018 | 14 | HKD | 10,400 | HKD | 7,280,000 | 23,641 | |||||||||||||||||
Hang Seng China Enterprise Index | Put | J.P. Morgan Securities LLC | 12/28/2018 | 58 | HKD | 10,800 | HKD | 31,320,000 | 129,517 | |||||||||||||||||
Hang Seng China Enterprise Index | Put | J.P. Morgan Securities LLC | 12/28/2018 | 6 | HKD | 11,400 | HKD | 3,420,000 | 20,152 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
18 Invesco Global Targeted Returns Fund
Open Over-The-Counter Index Options Purchased—(continued) | ||||||||||||||||||||||||||
Description | Type of Contract | Broker/Counterparty | Expiration Date | Number of Contracts | Exercise Price | Notional Value(i) | Value | |||||||||||||||||||
Hang Seng China Enterprise Index | Put | J.P. Morgan Chase Bank, N.A. | 12/28/2018 | 21 | HKD | 10,800 | HKD | 11,340,000 | $ | 46,894 | ||||||||||||||||
Hang Seng China Enterprise Index | Put | Societe Generale | 12/28/2018 | 84 | HKD | 10,800 | HKD | 39,960,000 | 187,576 | |||||||||||||||||
Hang Seng China Enterprise Index | Put | UBS | 12/28/2018 | 56 | HKD | 10,800 | HKD | 21,600,000 | 125,051 | |||||||||||||||||
SMI Index | Put | Citigroup Global Markets Inc. | 06/15/2018 | 22 | CHF | 8,000 | CHF | 1,760,000 | 2,046 | |||||||||||||||||
SMI Index | Put | Citigroup Global Markets Inc. | 06/15/2018 | 20 | CHF | 8,200 | CHF | 1,640,000 | 3,645 | |||||||||||||||||
SMI Index | Put | Citigroup Global Markets Inc. | 06/15/2018 | 15 | CHF | 8,600 | CHF | 1,290,000 | 9,380 | |||||||||||||||||
SMI Index | Put | Deutsche Bank Securities Inc. | 06/15/2018 | 11 | CHF | 8,000 | CHF | 880,000 | 1,023 | |||||||||||||||||
SMI Index | Put | Deutsche Bank Securities Inc. | 06/15/2018 | 8 | CHF | 8,200 | CHF | 656,000 | 1,458 | |||||||||||||||||
SMI Index | Put | Deutsche Bank Securities Inc. | 06/15/2018 | 7 | CHF | 8,600 | CHF | 602,000 | 4,377 | |||||||||||||||||
SMI Index | Put | Goldman Sachs International | 06/15/2018 | 31 | CHF | 8,000 | CHF | 2,480,000 | 2,883 | |||||||||||||||||
SMI Index | Put | Goldman Sachs International | 06/15/2018 | 30 | CHF | 8,200 | CHF | 2,460,000 | 5,468 | |||||||||||||||||
SMI Index | Put | Goldman Sachs International | 06/15/2018 | 26 | CHF | 8,300 | CHF | 2,158,000 | 6,530 | |||||||||||||||||
SMI Index | Put | Goldman Sachs International | 06/15/2018 | 93 | CHF | 8,600 | CHF | 7,998,000 | 58,156 | |||||||||||||||||
SMI Index | Put | Goldman Sachs International | 06/15/2018 | 16 | CHF | 8,900 | CHF | 1,424,000 | 25,668 | |||||||||||||||||
SMI Index | Put | Goldman Sachs International | 12/21/2018 | 23 | CHF | 8,000 | CHF | 1,840,000 | 32,794 | |||||||||||||||||
SMI Index | Put | Goldman Sachs International | 12/21/2018 | 22 | CHF | 8,100 | CHF | 1,782,000 | 35,399 | |||||||||||||||||
SMI Index | Put | Goldman Sachs International | 12/21/2018 | 21 | CHF | 8,200 | CHF | 1,722,000 | 38,139 | |||||||||||||||||
SMI Index | Put | J.P. Morgan Securities LLC | 06/15/2018 | 44 | CHF | 8,600 | CHF | 3,784,000 | 27,515 | |||||||||||||||||
SMI Index | Put | J.P. Morgan Securities LLC | 12/21/2018 | 8 | CHF | 8,000 | CHF | 640,000 | 11,407 | |||||||||||||||||
SMI Index | Put | J.P. Morgan Securities LLC | 12/21/2018 | 7 | CHF | 8,100 | CHF | 567,000 | 11,264 | |||||||||||||||||
SMI Index | Put | J.P. Morgan Securities LLC | 12/21/2018 | 7 | CHF | 8,200 | CHF | 574,000 | 12,713 | |||||||||||||||||
SMI Index | Put | J.P. Morgan Chase Bank, N.A. | 06/15/2018 | 8 | CHF | 7,700 | CHF | 616,000 | 252 | |||||||||||||||||
SMI Index | Put | J.P. Morgan Chase Bank, N.A. | 06/15/2018 | 7 | CHF | 8,000 | CHF | 560,000 | 651 | |||||||||||||||||
SMI Index | Put | J.P. Morgan Chase Bank, N.A. | 06/15/2018 | 6 | CHF | 8,200 | CHF | 492,000 | 1,094 | |||||||||||||||||
SMI Index | Put | J.P. Morgan Chase Bank, N.A. | 06/15/2018 | 61 | CHF | 8,600 | CHF | 5,246,000 | 38,146 | |||||||||||||||||
SMI Index | Put | Societe Generale | 06/15/2018 | 3 | CHF | 8,200 | CHF | 246,000 | 547 | |||||||||||||||||
SMI Index | Put | Societe Generale | 06/15/2018 | 3 | CHF | 8,600 | CHF | 258,000 | 1,876 | |||||||||||||||||
SMI Index | Put | UBS | 06/15/2018 | 12 | CHF | 7,700 | CHF | 924,000 | 379 | |||||||||||||||||
SMI Index | Put | UBS | 06/15/2018 | 24 | CHF | 8,000 | CHF | 1,920,000 | 2,231 | |||||||||||||||||
SMI Index | Put | UBS | 06/15/2018 | 51 | CHF | 8,200 | CHF | 4,182,000 | 9,295 | |||||||||||||||||
SMI Index | Put | UBS | 06/15/2018 | 35 | CHF | 8,600 | CHF | 3,010,000 | 21,887 | |||||||||||||||||
Subtotal — Over-The-Counter Index Put Options Purchased | 2,371 | 1,345,317 | ||||||||||||||||||||||||
Total Over-The-Counter Index Options Purchased — Equity Risk | 5,712 | $ | 7,442,679 |
(i) | Notional Value is calculated by multiplying the Number of Contracts by the Exercise Price by the multiplier. |
Open Over-The-Counter Foreign Currency Options Purchased | ||||||||||||||||||||||
Description | Type of Contract | Counterparty | Expiration Date | Exercise Price | Notional Value | Value | ||||||||||||||||
CHF versus JPY | Call | Barclays Bank PLC | 07/02/2018 | JPY | 117.100 | CHF | 2,642,000 | $ | 782 | |||||||||||||
CHF versus JPY | Call | Citigroup Global Markets Inc. | 05/02/2018 | JPY | 123.000 | CHF | 1,393,374 | 0 | ||||||||||||||
CHF versus JPY | Call | Morgan Stanley Capital Services LLC | 05/02/2018 | JPY | 120.000 | CHF | 1,393,372 | 0 | ||||||||||||||
CHF versus JPY | Call | Morgan Stanley Capital Services LLC | 06/04/2018 | JPY | 120.000 | CHF | 2,786,744 | 22 | ||||||||||||||
EUR versus SEK | Call | J.P. Morgan Securities LLC | 06/19/2018 | SEK | 10.500 | EUR | 2,709,490 | 44,715 | ||||||||||||||
EUR versus SEK | Call | J.P. Morgan Securities LLC | 07/17/2018 | SEK | 10.600 | EUR | 5,584,020 | 75,600 | ||||||||||||||
EUR versus SEK | Call | Morgan Stanley Capital Services LLC | 08/21/2018 | SEK | 10.700 | EUR | 670,956 | 8,186 | ||||||||||||||
EUR versus SEK | Call | Morgan Stanley Capital Services LLC | 08/21/2018 | SEK | 10.850 | EUR | 1,143,926 | 8,584 | ||||||||||||||
EUR versus USD | Call | Citigroup Global Markets Inc. | 02/05/2019 | USD | 1.286 | EUR | 603,100 | 7,940 | ||||||||||||||
EUR versus USD | Call | J.P. Morgan Securities LLC | 02/05/2019 | USD | 1.351 | EUR | 8,333,600 | 37,391 | ||||||||||||||
USD versus BRL | Call | J.P. Morgan Securities LLC | 01/17/2019 | BRL | 3.750 | USD | 728,000 | 20,283 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
19 Invesco Global Targeted Returns Fund
Open Over-The-Counter Foreign Currency Options Purchased—(continued) | ||||||||||||||||||||||
Description | Type of Contract | Counterparty | Expiration Date | Exercise Price | Notional Value | Value | ||||||||||||||||
USD versus BRL | Call | Morgan Stanley Capital Services LLC | 01/17/2019 | BRL | 3.750 | USD | 1,922,000 | $ | 53,548 | |||||||||||||
Subtotal — Over-The-Counter Foreign Currency Call Options Purchased | 257,051 | |||||||||||||||||||||
EUR versus USD | Put | J.P. Morgan Securities LLC | 02/05/2019 | USD | 1.248 | EUR | 8,333,600 | 299,624 | ||||||||||||||
Subtotal — Over-The-Counter Foreign Currency Put Options Purchased | 299,624 | |||||||||||||||||||||
Total — Over-The-Counter Foreign Currency Options Purchased — Currency Risk |
| 556,675 | ||||||||||||||||||||
Total — Options Purchased (Cost $9,467,376) | $ | 7,999,354 |
Open Over-The-Counter Index Options Written | ||||||||||||||||||||||||||||||||||
Description | Type of Contract | Counterparty | Expiration Date | Number of Contracts | Exercise Price | Premiums Received | Notional Value(j) | Value | Unrealized Appreciation (Depreciation) | |||||||||||||||||||||||||
CBOE SPX Volatility Index | Call | Barclays Bank PLC | 05/16/2018 | 460 | USD | 17 | $ | (105,800 | ) | USD | 782,000 | $ | (55,217 | ) | $ | 50,583 | ||||||||||||||||||
FTSE 100 Index | Call | Barclays Bank PLC | 09/21/2018 | 73 | GBP | 7,150 | (182,628 | ) | GBP | 5,219,500 | (377,831 | ) | (195,203 | ) | ||||||||||||||||||||
FTSE 100 Index | Call | Societe Generale | 09/21/2018 | 37 | GBP | 7,150 | (94,677 | ) | GBP | 2,645,500 | (191,504 | ) | (96,827 | ) | ||||||||||||||||||||
FTSE 100 Index | Call | Societe Generale | 09/21/2018 | 52 | GBP | 7,500 | (110,725 | ) | GBP | 3,900,000 | (110,152 | ) | 573 | |||||||||||||||||||||
FTSE 100 Index | Call | Societe Generale | 09/21/2018 | 54 | GBP | 7,425 | (112,499 | ) | GBP | 4,009,500 | (143,773 | ) | (31,274 | ) | ||||||||||||||||||||
FTSE 100 Index | Call | Societe Generale | 09/21/2018 | 330 | GBP | 7,400 | (840,121 | ) | GBP | 24,420,000 | (943,498 | ) | (103,377 | ) | ||||||||||||||||||||
Hang Seng China Enterprise Index | Call | J.P. Morgan Chase Bank, N.A. | 12/28/2018 | 23 | HKD | 11,200 | (151,684 | ) | HKD | 12,880,000 | (193,531 | ) | (41,847 | ) | ||||||||||||||||||||
Hang Seng China Enterprise Index | Call | Societe Generale | 12/28/2018 | 52 | HKD | 11,200 | (594,000 | ) | HKD | 29,120,000 | (437,548 | ) | 156,452 | |||||||||||||||||||||
Hang Seng China Enterprise Index | Call | UBS | 12/28/2018 | 39 | HKD | 11,200 | (607,446 | ) | HKD | 21,840,000 | (328,161 | ) | 279,285 | |||||||||||||||||||||
Nikkei 225 Index | Call | BNP Paribas S.A. | 12/14/2018 | 2 | JPY | 24,000 | (8,348 | ) | JPY | 48,000,000 | (8,520 | ) | (172 | ) | ||||||||||||||||||||
Nikkei 225 Index | Call | UBS | 12/14/2018 | 45 | JPY | 25,000 | (257,216 | ) | JPY | 1,125,000,000 | (104,694 | ) | 152,522 | |||||||||||||||||||||
S&P 500 Index | Call | Bank of America Merrill Lynch | 05/31/2018 | 26 | USD | 2,740 | (56,619 | ) | USD | 7,124,000 | (20,916 | ) | 35,703 | |||||||||||||||||||||
S&P 500 Index | Call | Bank of America Merrill Lynch | 05/31/2018 | 26 | USD | 2,775 | (29,760 | ) | USD | 7,215,000 | (8,145 | ) | 21,615 | |||||||||||||||||||||
S&P 500 Index | Call | Bank of America Merrill Lynch | 07/20/2018 | 26 | USD | 2,630 | (263,226 | ) | USD | 6,838,000 | (214,926 | ) | 48,300 | |||||||||||||||||||||
S&P 500 Index | Call | Bank of America Merrill Lynch | 07/20/2018 | 26 | USD | 2,670 | (219,711 | ) | USD | 6,942,000 | (152,755 | ) | 66,956 | |||||||||||||||||||||
Subtotal — Over-The-Counter Index Call Options Written |
| 1,271 | (3,634,460 | ) | (3,291,171 | ) | 343,289 | |||||||||||||||||||||||||||
FTSE 100 Index | Put | Barclays Bank PLC | 06/15/2018 | 34 | GBP | 7,150 | (134,197 | ) | GBP | 2,431,000 | (15,108 | ) | 119,089 | |||||||||||||||||||||
FTSE 100 Index | Put | Barclays Bank PLC | 09/21/2018 | 37 | GBP | 6,800 | (96,522 | ) | GBP | 2,516,000 | (37,976 | ) | 58,546 | |||||||||||||||||||||
FTSE 100 Index | Put | Deutsche Bank Securities Inc. | 06/15/2018 | 5 | GBP | 7,150 | (13,733 | ) | GBP | 357,500 | (2,222 | ) | 11,511 | |||||||||||||||||||||
FTSE 100 Index | Put | Societe Generale | 09/21/2018 | 18 | GBP | 6,800 | (48,041 | ) | GBP | 1,224,000 | (18,475 | ) | 29,566 | |||||||||||||||||||||
FTSE 100 Index | Put | Societe Generale | 09/21/2018 | 26 | GBP | 7,150 | (45,329 | ) | GBP | 1,859,000 | (48,852 | ) | (3,523 | ) | ||||||||||||||||||||
FTSE 100 Index | Put | Societe Generale | 09/21/2018 | 27 | GBP | 7,050 | (51,266 | ) | GBP | 1,903,500 | (42,457 | ) | 8,809 | |||||||||||||||||||||
FTSE 100 Index | Put | UBS | 06/15/2018 | 7 | GBP | 7,150 | (29,352 | ) | GBP | 500,500 | (3,111 | ) | 26,241 | |||||||||||||||||||||
Hang Seng China Enterprise Index | Put | J.P. Morgan Chase Bank, N.A. | 12/28/2018 | 24 | HKD | 10,800 | (118,665 | ) | HKD | 12,960,000 | (53,593 | ) | 65,072 | |||||||||||||||||||||
Hang Seng China Enterprise Index | Put | Societe Generale | 12/28/2018 | 65 | HKD | 10,800 | (182,122 | ) | HKD | 35,100,000 | (145,148 | ) | 36,974 | |||||||||||||||||||||
Hang Seng China Enterprise Index | Put | UBS | 12/28/2018 | 57 | HKD | 10,800 | (100,313 | ) | HKD | 30,780,000 | (127,283 | ) | (26,970 | ) | ||||||||||||||||||||
Nikkei 225 Index | Put | BNP Paribas S.A. | 12/14/2018 | 2 | JPY | 20,000 | (15,828 | ) | JPY | 40,000,000 | (8,367 | ) | 7,461 | |||||||||||||||||||||
Nikkei 225 Index | Put | UBS | 12/14/2018 | 45 | JPY | 21,000 | (414,597 | ) | JPY | 945,000,000 | (287,221 | ) | 127,376 | |||||||||||||||||||||
S&P 500 Index | Put | Bank of America Merrill Lynch | 07/20/2018 | 13 | USD | 2,370 | (43,198 | ) | USD | 3,081,000 | (21,050 | ) | 22,148 | |||||||||||||||||||||
S&P 500 Index | Put | Bank of America Merrill Lynch | 07/20/2018 | 13 | USD | 2,405 | (29,871 | ) | USD | 3,126,500 | (24,993 | ) | 4,878 | |||||||||||||||||||||
SMI Index | Put | Citigroup Global Markets Inc. | 06/15/2018 | 3 | CHF | 7,700 | (538 | ) | CHF | 231,000 | (95 | ) | 443 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
20 Invesco Global Targeted Returns Fund
Open Over-The-Counter Index Options Written—(continued) | ||||||||||||||||||||||||||||||||||
Description | Type of Contract | Counterparty | Expiration Date | Number of Contracts | Exercise Price | Premiums Received | Notional Value(j) | Value | Unrealized Appreciation (Depreciation) | |||||||||||||||||||||||||
SMI Index | Put | Citigroup Global Markets Inc. | 06/15/2018 | 11 | CHF | 8,000 | $ | (3,369 | ) | CHF | 880,000 | $ | (1,023 | ) | $ | 2,346 | ||||||||||||||||||
SMI Index | Put | Citigroup Global Markets Inc. | 06/15/2018 | 14 | CHF | 8,200 | (6,369 | ) | CHF | 1,148,000 | (2,552 | ) | 3,817 | |||||||||||||||||||||
SMI Index | Put | Citigroup Global Markets Inc. | 06/15/2018 | 3 | CHF | 8,300 | (1,826 | ) | CHF | 249,000 | (754 | ) | 1,072 | |||||||||||||||||||||
SMI Index | Put | Citigroup Global Markets Inc. | 06/15/2018 | 17 | CHF | 8,600 | (20,623 | ) | CHF | 1,462,000 | (10,631 | ) | 9,992 | |||||||||||||||||||||
SMI Index | Put | Citigroup Global Markets Inc. | 06/15/2018 | 2 | CHF | 8,900 | (5,339 | ) | CHF | 178,000 | (3,208 | ) | 2,131 | |||||||||||||||||||||
SMI Index | Put | Deutsche Bank Securities Inc. | 06/15/2018 | 10 | CHF | 8,000 | (13,033 | ) | CHF | 800,000 | (930 | ) | 12,103 | |||||||||||||||||||||
SMI Index | Put | Deutsche Bank Securities Inc. | 06/15/2018 | 8 | CHF | 8,200 | (12,992 | ) | CHF | 656,000 | (1,458 | ) | 11,534 | |||||||||||||||||||||
SMI Index | Put | Deutsche Bank Securities Inc. | 06/15/2018 | 6 | CHF | 8,600 | (15,347 | ) | CHF | 516,000 | (3,752 | ) | 11,595 | |||||||||||||||||||||
SMI Index | Put | Goldman Sachs International | 06/15/2018 | 2 | CHF | 8,000 | (5,147 | ) | CHF | 160,000 | (186 | ) | 4,961 | |||||||||||||||||||||
SMI Index | Put | Goldman Sachs International | 06/15/2018 | 2 | CHF | 8,200 | (5,462 | ) | CHF | 164,000 | (364 | ) | 5,098 | |||||||||||||||||||||
SMI Index | Put | Goldman Sachs International | 06/15/2018 | 85 | CHF | 8,600 | (281,430 | ) | CHF | 7,310,000 | (53,152 | ) | 228,278 | |||||||||||||||||||||
SMI Index | Put | J.P. Morgan Chase Bank, N.A. | 06/15/2018 | 5 | CHF | 7,700 | (422 | ) | CHF | 385,000 | (158 | ) | 264 | |||||||||||||||||||||
SMI Index | Put | J.P. Morgan Chase Bank, N.A. | 06/15/2018 | 21 | CHF | 8,000 | (3,585 | ) | CHF | 1,680,000 | (1,953 | ) | 1,632 | |||||||||||||||||||||
SMI Index | Put | J.P. Morgan Chase Bank, N.A. | 06/15/2018 | 29 | CHF | 8,200 | (8,197 | ) | CHF | 2,378,000 | (5,286 | ) | 2,911 | |||||||||||||||||||||
SMI Index | Put | J.P. Morgan Chase Bank, N.A. | 06/15/2018 | 7 | CHF | 8,300 | (2,533 | ) | CHF | 581,000 | (1,759 | ) | 774 | |||||||||||||||||||||
SMI Index | Put | J.P. Morgan Chase Bank, N.A. | 06/15/2018 | 36 | CHF | 8,600 | (29,615 | ) | CHF | 3,096,000 | (22,512 | ) | 7,103 | |||||||||||||||||||||
SMI Index | Put | J.P. Morgan Chase Bank, N.A. | 06/15/2018 | 4 | CHF | 8,900 | (7,862 | ) | CHF | 356,000 | (6,416 | ) | 1,446 | |||||||||||||||||||||
SMI Index | Put | Societe Generale | 06/15/2018 | 7 | CHF | 7,700 | (1,018 | ) | CHF | 539,000 | (221 | ) | 797 | |||||||||||||||||||||
SMI Index | Put | Societe Generale | 06/15/2018 | 28 | CHF | 8,000 | (7,889 | ) | CHF | 2,240,000 | (2,603 | ) | 5,286 | |||||||||||||||||||||
SMI Index | Put | Societe Generale | 06/15/2018 | 36 | CHF | 8,200 | (16,112 | ) | CHF | 2,952,000 | (6,561 | ) | 9,551 | |||||||||||||||||||||
SMI Index | Put | Societe Generale | 06/15/2018 | 9 | CHF | 8,300 | (5,127 | ) | CHF | 747,000 | (2,261 | ) | 2,866 | |||||||||||||||||||||
SMI Index | Put | Societe Generale | 06/15/2018 | 76 | CHF | 8,600 | (141,793 | ) | CHF | 6,536,000 | (47,525 | ) | 94,268 | |||||||||||||||||||||
SMI Index | Put | Societe Generale | 06/15/2018 | 6 | CHF | 8,900 | (15,642 | ) | CHF | 534,000 | (9,625 | ) | 6,017 | |||||||||||||||||||||
Subtotal — Over-The-Counter Index Put Options Written | 800 | (1,934,304 | ) | (1,020,841 | ) | 913,463 | ||||||||||||||||||||||||||||
Total — Index Options Written — Equity Risk | 2,071 | $ | (5,568,764 | ) | $ | (4,312,012 | ) | $ | 1,256,752 |
(j) | Notional Value is calculated by multiplying the Number of Contracts by the Exercise Price by the multiplier. |
Open Over-The-Counter Foreign Currency Options Written | ||||||||||||||||||||||||||||||
Description | Type of Contract | Counterparty | Expiration Date | Exercise Price | Premiums Received | Notional Value | Value | Unrealized Appreciation (Depreciation) | ||||||||||||||||||||||
EUR versus USD | Call | Citigroup Global Markets Inc. | 02/05/2019 | USD | 1.351 | $ | (4,996 | ) | EUR | 603,100 | $ | (2,706 | ) | $ | 2,290 | |||||||||||||||
EUR versus USD | Call | J.P. Morgan Chase Bank, N.A. | 02/05/2019 | USD | 1.286 | (283,704 | ) | EUR | 8,333,600 | (109,708 | ) | 173,996 | ||||||||||||||||||
USD versus BRL | Call | J.P. Morgan Chase Bank, N.A. | 01/17/2019 | BRL | 3.750 | (3,510 | ) | USD | 178,000 | (4,959 | ) | (1,449 | ) | |||||||||||||||||
USD versus CAD | Call | Bank of America Merrill Lynch | 05/17/2018 | CAD | 1.270 | (15,094 | ) | USD | 4,096,000 | (51,812 | ) | (36,718 | ) | |||||||||||||||||
Subtotal — Over-The-Counter Foreign Currency Call Options Written |
| (307,304 | ) | (169,185 | ) | 138,119 | ||||||||||||||||||||||||
CHF versus JPY | Put | Barclays Bank PLC | 07/02/2018 | JPY | 105.900 | (5,768 | ) | CHF | 2,642,000 | (3,073 | ) | 2,695 | ||||||||||||||||||
CHF versus JPY | Put | Citigroup Global Markets Inc. | 05/02/2018 | JPY | 112.000 | (2,810 | ) | CHF | 1,393,374 | (21,676 | ) | (18,866 | ) | |||||||||||||||||
CHF versus JPY | Put | Morgan Stanley Capital Services LLC | 05/02/2018 | JPY | 108.000 | (2,143 | ) | CHF | 1,393,372 | (1 | ) | 2,142 | ||||||||||||||||||
CHF versus JPY | Put | Morgan Stanley Capital Services LLC | 06/04/2018 | JPY | 108.000 | (5,645 | ) | CHF | 2,786,744 | (3,765 | ) | 1,880 | ||||||||||||||||||
EUR versus USD | Put | Citigroup Global Markets Inc. | 02/05/2019 | USD | 1.248 | (13,301 | ) | EUR | 603,100 | (21,683 | ) | (8,382 | ) | |||||||||||||||||
Subtotal — Over-The-Counter Foreign Currency Put Options Written |
| (29,667 | ) | (50,198 | ) | (20,531 | ) | |||||||||||||||||||||||
Total — Foreign Currency Options Written — Currency Risk | (336,971 | ) | (219,383 | ) | 117,588 | |||||||||||||||||||||||||
Total — Options Written | $ | (5,905,735 | ) | $ | (4,531,395 | ) | $ | 1,374,340 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
21 Invesco Global Targeted Returns Fund
Open Futures Contracts(k) | ||||||||||||||||||||
Long Futures Contracts | Number of Contracts | Expiration Month | Notional Value | Value | Unrealized Appreciation (Depreciation) | |||||||||||||||
CAC 40 Index | 162 | May-2018 | $ | 10,707,782 | $ | 376,135 | $ | 376,135 | ||||||||||||
MSCI Taiwan Index | 91 | May-2018 | 3,580,850 | 12,746 | 12,746 | |||||||||||||||
Swiss Market Index | 38 | June-2018 | 3,388,557 | 110,965 | 110,965 | |||||||||||||||
Subtotal — Equity Risk | 499,846 | 499,846 | ||||||||||||||||||
Euro Bonds | 1 | June-2018 | 191,710 | 1,746 | 1,746 | |||||||||||||||
Euro-Boxl 30 Year Bonds | 2 | June-2018 | 395,015 | 6,218 | 6,218 | |||||||||||||||
Euro-Schatz 2 Year Bonds | 10 | June-2018 | 1,351,597 | 1,220 | 1,220 | |||||||||||||||
U.S. Treasury Long Bonds | 1 | June-2018 | 143,844 | 1,617 | 1,617 | |||||||||||||||
Subtotal — Interest Rate Risk | 10,801 | 10,801 | ||||||||||||||||||
Subtotal — Long Futures Contracts | 510,647 | 510,647 | ||||||||||||||||||
Short Futures Contracts | ||||||||||||||||||||
Bovespa Index | 95 | June-2018 | (2,347,139 | ) | (17,741 | ) | (17,741 | ) | ||||||||||||
DAX Index | 28 | June-2018 | (10,661,213 | ) | (225,123 | ) | (225,123 | ) | ||||||||||||
EURO STOXX 50 Index | 253 | June-2018 | (10,614,741 | ) | (466,790 | ) | (466,790 | ) | ||||||||||||
E-Mini S&P 500 Index | 66 | June-2018 | (8,735,100 | ) | 330,147 | 330,147 | ||||||||||||||
FTSE 100 Index | 146 | June-2018 | (14,993,377 | ) | (578,641 | ) | (578,641 | ) | ||||||||||||
Hang Seng China Enterprises Index | 48 | May-2018 | (3,750,478 | ) | (52,879 | ) | (52,879 | ) | ||||||||||||
Mexican Bolsa IPC Index | 28 | June-2018 | (725,497 | ) | 10,527 | 10,527 | ||||||||||||||
MSCI AC Asia ex Japan Index | 53 | June-2018 | (2,711,401 | ) | 50,741 | 50,741 | ||||||||||||||
Nikkei 225 Index | 13 | June-2018 | (1,338,707 | ) | (68,332 | ) | (68,332 | ) | ||||||||||||
Russell UK Mid 150 Futures Index | 65 | June-2018 | (3,493,241 | ) | (120,259 | ) | (120,259 | ) | ||||||||||||
Subtotal — Equity Risk | (1,138,350 | ) | (1,138,350 | ) | ||||||||||||||||
Long Gilt | 11 | June-2018 | (1,851,334 | ) | (25,882 | ) | (25,882 | ) | ||||||||||||
Subtotal — Interest Rate Risk | (25,882 | ) | (25,882 | ) | ||||||||||||||||
Subtotal — Short Futures Contracts | (1,164,232 | ) | (1,164,232 | ) | ||||||||||||||||
Total — Futures Contracts | $ | (653,585 | ) | $ | (653,585 | ) |
(k) | Futures contracts collateralized by $4,195,646 cash held with Bank of America Merrill Lynch, the futures commission merchant. |
Open Centrally Cleared Credit Default Swap Agreements(l) | ||||||||||||||||||||||||||||||||||||
Reference Entity | Buy/Sell Protection | (Pay)/ Receive Fixed Rate | Payment Frequency | Maturity Date | Implied Credit Spread(m) | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation)(n) | |||||||||||||||||||||||||||
Markit CDX North America Investment Grade Index, Series 29, Version 1 | Buy | (1.00)% | Quarterly | 12/20/2022 | 0.531% | USD | 21,768,000 | $ | (488,332 | ) | $ | (442,043 | ) | $ | 46,289 | |||||||||||||||||||||
Markit CDX North America Investment Grade Index, Series 30, Version 1 | Buy | (1.00) | Quarterly | 06/20/2023 | 0.608 | USD | 5,941,153 | (112,472 | ) | (110,114 | ) | 2,358 | ||||||||||||||||||||||||
Markit iTraxx Europe Index, Series 28, Version 1 | Sell | 1.00 | Quarterly | 12/20/2022 | 0.459 | EUR | 4,072,000 | 108,346 | 122,870 | 14,524 | ||||||||||||||||||||||||||
Markit iTraxx Europe Index, Series 29, Version 1 | Sell | 1.00 | Quarterly | 06/20/2023 | 0.543 | EUR | 599,000 | 16,686 | 16,777 | 91 | ||||||||||||||||||||||||||
Subtotal — Appreciation |
| (475,772 | ) | (412,510 | ) | 63,262 | ||||||||||||||||||||||||||||||
Markit iTraxx Crossover Index, Series 29, Version 1 | Buy | (5.00) | Quarterly | 06/20/2023 | 2.703 | EUR | 300,000 | (37,355 | ) | (38,589 | ) | (1,234 | ) | |||||||||||||||||||||||
Markit iTraxx Europe Index, Series 27, Version 1 | Buy | (1.00) | Quarterly | 06/20/2022 | 0.364 | EUR | 21,323,000 | (268,705 | ) | (677,966 | ) | (409,261 | ) | |||||||||||||||||||||||
Markit iTraxx Europe Index, Series 29, Version 1 | Buy | (1.00 | ) | Quarterly | 06/20/2023 | 0.543 | EUR | 300,000 | (7,700 | ) | (8,403 | ) | (703 | ) | ||||||||||||||||||||||
Subtotal — Depreciation |
| (313,760 | ) | (724,958 | ) | (411,198 | ) | |||||||||||||||||||||||||||||
Total Credit Default Swap Agreements — Credit Risk |
| $ | (789,532 | ) | $ | (1,137,468 | ) | $ | (347,936 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
22 Invesco Global Targeted Returns Fund
(m) | Implied credit spreads represent the current level as of April 30, 2018 at which protection could be bought or sold given the terms of the existing credit default swap contract and serve as an indicator of the current status of the payment/performance risk of the credit default swap contract. An implied credit spread that has widened or increased since entry into the initial contract may indicate a deteriorating credit profile and increased risk of default for the reference entity. A declining or narrowing spread may indicate an improving credit profile or decreased risk of default for the reference entity. Alternatively, credit spreads may increase or decrease reflecting the general tolerance for risk in the credit spread markets generally. |
(n) | The daily variation margin receivable (payable) at period end is recorded in the Consolidated Statement of Assets and Liabilities. |
Open Centrally Cleared Interest Rate Swap Agreements(l) | ||||||||||||||||||||||||||||||
Pay/Receive Floating Rate | Floating Rate Index | Payment Frequency | (Pay)/ Receive Fixed | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation)(o) | |||||||||||||||||||||
Receive | 3 Month CDOR | Semi-Annually | 2.113 | % | Semi-Annually | 12/20/2022 | CAD | 792,000 | $ | — | $ | 10,513 | $ | 10,513 | ||||||||||||||||
Receive | 3 Month CDOR | Semi-Annually | 2.133 | Semi-Annually | 12/20/2022 | CAD | 998,000 | — | 12,560 | 12,560 | ||||||||||||||||||||
Receive | 3 Month CDOR | Semi-Annually | 2.420 | Semi-Annually | 12/20/2022 | CAD | 1,838,630 | — | 6,354 | 6,354 | ||||||||||||||||||||
Receive | 3 Month CDOR | Semi-Annually | 2.430 | Semi-Annually | 12/20/2022 | CAD | 1,838,630 | — | 5,741 | 5,741 | ||||||||||||||||||||
Receive | 3 Month CDOR | Semi-Annually | 2.435 | Semi-Annually | 12/20/2022 | CAD | 3,677,259 | — | 10,869 | 10,869 | ||||||||||||||||||||
Receive | 3 Month CDOR | Semi-Annually | 2.453 | Semi-Annually | 12/20/2022 | CAD | 1,838,630 | — | 4,361 | 4,361 | ||||||||||||||||||||
Receive | 3 Month CDOR | Semi-Annually | 2.455 | Semi-Annually | 12/20/2022 | CAD | 1,838,630 | — | 4,208 | 4,208 | ||||||||||||||||||||
Receive | 3 Month CDOR | Semi-Annually | 2.460 | Semi-Annually | 12/20/2022 | CAD | 1,838,630 | — | 3,902 | 3,902 | ||||||||||||||||||||
Receive | 3 Month CDOR | Semi-Annually | 2.463 | Semi-Annually | 12/20/2022 | CAD | 1,838,630 | — | 3,748 | 3,748 | ||||||||||||||||||||
Receive | 3 Month CDOR | Semi-Annually | 2.478 | Semi-Annually | 12/20/2022 | CAD | 2,006,110 | — | 3,086 | 3,086 | ||||||||||||||||||||
Receive | 3 Month STIBOR | Quarterly | (0.036 | ) | Annually | 09/21/2021 | SEK | 10,167,000 | — | 7,788 | 7,788 | |||||||||||||||||||
Receive | 3 Month STIBOR | Quarterly | 0.020 | Annually | 09/21/2021 | SEK | 11,493,000 | — | 6,309 | 6,309 | ||||||||||||||||||||
Receive | 3 Month STIBOR | Quarterly | 0.020 | Annually | 12/21/2021 | SEK | 16,053,000 | — | 13,382 | 13,382 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.655 | Semi-Annually | 03/18/2027 | USD | 2,005,530 | — | 49,889 | 49,889 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.661 | Semi-Annually | 03/18/2027 | USD | 4,228,055 | — | 103,666 | 103,666 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.665 | Semi-Annually | 03/18/2027 | USD | 3,971,347 | — | 96,379 | 96,379 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.671 | Semi-Annually | 09/15/2047 | USD | 1,083,000 | — | 32,074 | 32,074 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.672 | Semi-Annually | 03/18/2027 | USD | 4,003,118 | — | 95,478 | 95,478 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.676 | Semi-Annually | 03/18/2027 | USD | 4,034,889 | — | 95,256 | 95,256 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.678 | Semi-Annually | 03/18/2027 | USD | 4,011,061 | — | 94,206 | 94,206 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.678 | Semi-Annually | 09/15/2047 | USD | 428,000 | — | 12,428 | 12,428 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.693 | Semi-Annually | 12/15/2047 | USD | 395,000 | — | 10,726 | 10,726 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.752 | Semi-Annually | 12/15/2047 | USD | 608,000 | — | 13,468 | 13,468 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.758 | Semi-Annually | 03/21/2023 | USD | 3,693,735 | — | 29,052 | 29,052 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.770 | Semi-Annually | 03/21/2023 | USD | 3,693,735 | — | 26,999 | 26,999 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.777 | Semi-Annually | 03/21/2023 | USD | 416,284 | — | 2,910 | 2,910 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.791 | Semi-Annually | 12/15/2047 | USD | 439,000 | — | 8,304 | 8,304 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.909 | Semi-Annually | 03/18/2027 | USD | 2,264,000 | — | 21,389 | 21,389 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.969 | Semi-Annually | 06/15/2048 | USD | 1,656,000 | — | 4,931 | 4,931 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 2.983 | Semi-Annually | 03/18/2027 | USD | 4,845,000 | — | 23,992 | 23,992 | ||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 3.002 | Semi-Annually | 06/17/2023 | USD | 2,129,000 | — | 2,467 | 2,467 | ||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.012 | Annually | 06/20/2028 | EUR | 454,000 | — | 941 | 941 | ||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.638 | Annually | 06/21/2028 | EUR | 961,000 | — | 1,060 | 1,060 | ||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.714 | Annually | 06/15/2048 | EUR | 483,000 | — | 4,545 | 4,545 | ||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.760 | Annually | 12/15/2047 | EUR | 504,000 | — | 2,934 | 2,934 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.443 | Semi-Annually | 06/16/2047 | GBP | 264,000 | — | 9,174 | 9,174 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.494 | Semi-Annually | 09/15/2047 | GBP | 86,000 | — | 2,224 | 2,224 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.500 | Semi-Annually | 12/15/2047 | GBP | 304,000 | — | 7,227 | 7,227 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.523 | Semi-Annually | 09/15/2047 | GBP | 589,211 | — | 12,555 | 12,555 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.544 | Semi-Annually | 09/15/2047 | GBP | 1,206,492 | — | 21,794 | 21,794 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.545 | Semi-Annually | 09/15/2047 | GBP | 566,313 | — | 10,142 | 10,142 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.549 | Semi-Annually | 09/15/2047 | GBP | 1,206,492 | — | 20,909 | 20,909 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.552 | Semi-Annually | 03/16/2048 | GBP | 1,792,964 | — | 26,542 | 26,542 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.558 | Semi-Annually | 09/15/2047 | GBP | 1,206,492 | — | 19,278 | 19,278 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
23 Invesco Global Targeted Returns Fund
Open Centrally Cleared Interest Rate Swap Agreements(l)—(continued) | ||||||||||||||||||||||||||||||
Pay/Receive Floating Rate | Floating Rate Index | Payment Frequency | (Pay)/ Receive Fixed | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation)(o) | |||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.576 | % | Semi-Annually | 03/16/2048 | GBP | 896,482 | $ | — | $ | 10,002 | $ | 10,002 | ||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.581 | Semi-Annually | 03/16/2048 | GBP | 621,229 | — | 6,407 | 6,407 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.598 | Semi-Annually | 12/15/2047 | GBP | 570,000 | — | 5,010 | 5,010 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.608 | Semi-Annually | 12/15/2047 | GBP | 571,000 | — | 4,096 | 4,096 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.614 | Semi-Annually | 03/16/2048 | GBP | 1,361,325 | — | 7,247 | 7,247 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.615 | Semi-Annually | 09/17/2046 | GBP | 4,229,880 | — | 47,141 | 47,141 | ||||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.648 | Semi-Annually | 12/15/2047 | GBP | 586,000 | — | 593 | 593 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.559 | Quarterly | 03/18/2022 | AUD | 2,969,629 | — | 274 | 274 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.560 | Quarterly | 03/18/2022 | AUD | 2,913,304 | — | 310 | 310 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.564 | Quarterly | 03/18/2022 | AUD | 3,458,371 | — | 563 | 563 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.568 | Quarterly | 03/18/2022 | AUD | 2,913,304 | — | 639 | 639 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.575 | Quarterly | 03/18/2022 | AUD | 3,120,098 | — | 992 | 992 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.583 | Quarterly | 03/18/2022 | AUD | 3,007,286 | — | 1,296 | 1,296 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.585 | Quarterly | 03/18/2022 | AUD | 3,458,371 | — | 1,588 | 1,588 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.597 | Quarterly | 03/18/2022 | AUD | 3,120,098 | — | 1,962 | 1,962 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.631 | Quarterly | 03/18/2022 | AUD | 3,767,034 | — | 4,177 | 4,177 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.636 | Quarterly | 06/17/2022 | AUD | 2,142,088 | — | 1,081 | 1,081 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.642 | Quarterly | 03/18/2022 | AUD | 3,458,372 | — | 4,372 | 4,372 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.653 | Quarterly | 06/17/2022 | AUD | 2,142,088 | — | 1,577 | 1,577 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.662 | Quarterly | 06/17/2022 | AUD | 3,496,472 | — | 3,040 | 3,040 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.663 | Quarterly | 06/17/2022 | AUD | 2,142,088 | — | 1,878 | 1,878 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.664 | Quarterly | 06/17/2022 | AUD | 2,142,088 | — | 1,923 | 1,923 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.665 | Quarterly | 06/17/2022 | AUD | 2,142,088 | — | 1,953 | 1,953 | ||||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.688 | Quarterly | 06/17/2022 | AUD | 2,142,088 | — | 2,644 | 2,644 | ||||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.390 | Semi-Annually | 06/20/2021 | CAD | 3,685,472 | — | 310 | 310 | ||||||||||||||||||||
Pay | 3 Month STIBOR | Quarterly | 0.598 | Annually | 06/20/2023 | SEK | 4,290,000 | — | 536 | 536 | ||||||||||||||||||||
Pay | 3 Month STIBOR | Quarterly | 2.234 | Annually | 03/15/2028 | SEK | 3,058,000 | — | 3,502 | 3,502 | ||||||||||||||||||||
Pay | 3 Month STIBOR | Quarterly | 2.265 | Annually | 03/15/2028 | SEK | 3,668,000 | — | 4,799 | 4,799 | ||||||||||||||||||||
Pay | 3 Month STIBOR | Quarterly | 2.313 | Annually | 01/19/2026 | SEK | 21,817,000 | — | 92,457 | 92,457 | ||||||||||||||||||||
Pay | 3 Month STIBOR | Quarterly | 2.534 | Annually | 12/17/2025 | SEK | 36,231,000 | — | 203,173 | 203,173 | ||||||||||||||||||||
Pay | 3 Month STIBOR | Quarterly | 2.655 | Annually | 01/04/2026 | SEK | 34,380,000 | — | 212,756 | 212,756 | ||||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 3.010 | Semi-Annually | 03/16/2048 | USD | 1,214,517 | — | 22 | 22 | ||||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 3.038 | Semi-Annually | 03/16/2048 | USD | 1,089,017 | — | 2,534 | 2,534 | ||||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 3.048 | Semi-Annually | 03/16/2048 | USD | 1,089,950 | — | 3,451 | 3,451 | ||||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 3.055 | Semi-Annually | 06/15/2048 | USD | 946,000 | — | 3,979 | 3,979 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 0.386 | Annually | 03/21/2023 | EUR | 13,474,598 | — | 1,429 | 1,429 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 0.444 | Annually | 03/21/2023 | EUR | 334,000 | — | 1,353 | 1,353 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.689 | Annually | 03/21/2028 | EUR | 5,493,000 | — | 22,367 | 22,367 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.788 | Annually | 03/21/2028 | EUR | 243,000 | — | 2,373 | 2,373 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.798 | Annually | 06/15/2048 | EUR | 217,000 | — | 367 | 367 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.812 | Annually | 03/16/2048 | EUR | 254,418 | — | 597 | 597 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.813 | Annually | 03/16/2048 | EUR | 249,329 | — | 601 | 601 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.814 | Annually | 03/16/2048 | EUR | 254,100 | — | 663 | 663 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.816 | Annually | 09/15/2047 | EUR | 652,000 | — | 209 | 209 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.817 | Annually | 03/16/2048 | EUR | 251,559 | — | 756 | 756 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.820 | Annually | 03/16/2048 | EUR | 255,516 | — | 853 | 853 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.821 | Annually | 09/15/2047 | EUR | 1,304,000 | — | 1,298 | 1,298 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.822 | Annually | 09/15/2047 | EUR | 654,000 | — | 734 | 734 | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.824 | Annually | 09/15/2047 | EUR | 653,000 | — | 907 | 907 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
24 Invesco Global Targeted Returns Fund
Open Centrally Cleared Interest Rate Swap Agreements(l)—(continued) | ||||||||||||||||||||||||||||||||||||
Pay/Receive Floating Rate | Floating Rate Index | Payment Frequency | (Pay)/ Receive Fixed | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation)(o) | |||||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.830 | % | Annually | 09/15/2047 | EUR | 652,000 | $ | — | $ | 1,385 | $ | 1,385 | ||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.833 | Annually | 03/16/2048 | EUR | 260,371 | — | 1,335 | 1,335 | ||||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.835 | Annually | 03/16/2048 | EUR | 254,245 | — | 1,354 | 1,354 | ||||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.841 | Annually | 09/15/2047 | EUR | 1,305,000 | — | 4,778 | 4,778 | ||||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.848 | Annually | 03/16/2048 | EUR | 251,702 | — | 1,791 | 1,791 | ||||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.850 | Annually | 03/16/2048 | EUR | 255,516 | — | 1,869 | 1,869 | ||||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.866 | Annually | 03/16/2048 | EUR | 254,244 | — | 2,399 | 2,399 | ||||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.893 | Annually | 12/15/2047 | EUR | 353,048 | — | 4,161 | 4,161 | ||||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.899 | Annually | 12/15/2047 | EUR | 685,952 | — | 8,710 | 8,710 | ||||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.937 | Annually | 12/15/2047 | EUR | 179,000 | — | 3,165 | 3,165 | ||||||||||||||||||||||||||
Pay | 6 Month GBP LIBOR | Semi-Annually | 1.650 | Semi-Annually | 03/16/2048 | GBP | 737,000 | — | 240 | 240 | ||||||||||||||||||||||||||
Pay | 6 Month GBP LIBOR | Semi-Annually | 1.661 | Semi-Annually | 12/15/2047 | GBP | 643,000 | — | 666 | 666 | ||||||||||||||||||||||||||
Pay | 6 Month GBP LIBOR | Semi-Annually | 1.670 | Semi-Annually | 09/15/2047 | GBP | 538,000 | — | 754 | 754 | ||||||||||||||||||||||||||
Subtotal — Appreciation |
| — | 1,661,158 | 1,661,158 | ||||||||||||||||||||||||||||||||
Receive | 3 Month CDOR | Semi-Annually | 2.525 | Semi-Annually | 12/20/2022 | CAD | 2,718,440 | — | (124 | ) | (124 | ) | ||||||||||||||||||||||||
Receive | 3 Month STIBOR | Quarterly | 0.348 | Annually | 06/21/2022 | SEK | 14,426,000 | — | (865 | ) | (865 | ) | ||||||||||||||||||||||||
Receive | 3 Month STIBOR | Quarterly | 0.354 | Annually | 06/21/2022 | SEK | 5,530,800 | — | (482 | ) | (482 | ) | ||||||||||||||||||||||||
Receive | 3 Month STIBOR | Quarterly | 0.390 | Annually | 04/29/2021 | SEK | 111,635,138 | — | (123,112 | ) | (123,112 | ) | ||||||||||||||||||||||||
Receive | 3 Month STIBOR | Quarterly | 0.720 | Annually | 03/21/2023 | SEK | 3,671,000 | — | (4,541 | ) | (4,541 | ) | ||||||||||||||||||||||||
Receive | 3 Month USD LIBOR | Quarterly | 3.048 | Semi-Annually | 03/16/2048 | USD | 202,000 | — | (643 | ) | (643 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.082 | Annually | 06/20/2021 | EUR | 8,767,000 | — | (2,570 | ) | (2,570 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.087 | Annually | 06/20/2021 | EUR | 17,534,000 | — | (8,523 | ) | (8,523 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.088 | Annually | 06/20/2021 | EUR | 26,301,000 | — | (13,933 | ) | (13,933 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.414 | Annually | 03/21/2023 | EUR | 374,835 | 7 | (843 | ) | (850 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.415 | Annually | 03/21/2023 | EUR | 2,317,131 | 6 | (5,338 | ) | (5,344 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.417 | Annually | 03/21/2023 | EUR | 411,559 | (43 | ) | (1,006 | ) | (963 | ) | |||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.418 | Annually | 03/21/2023 | EUR | 4,124,942 | — | (10,298 | ) | (10,298 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.419 | Annually | 03/21/2023 | EUR | 1,588,293 | 224 | (4,066 | ) | (4,290 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.420 | Annually | 03/21/2023 | EUR | 849,606 | 116 | (2,221 | ) | (2,337 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.422 | Annually | 03/21/2023 | EUR | 1,300,336 | (393 | ) | (3,561 | ) | (3,168 | ) | |||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.423 | Annually | 03/21/2023 | EUR | 773,550 | 186 | (2,160 | ) | (2,346 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.424 | Annually | 03/21/2023 | EUR | 852,874 | 342 | (2,431 | ) | (2,773 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.425 | Annually | 03/21/2023 | EUR | 1,254,613 | (156 | ) | (3,649 | ) | (3,493 | ) | |||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.426 | Annually | 03/21/2023 | EUR | 1,246,560 | (15 | ) | (3,701 | ) | (3,686 | ) | |||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.427 | Annually | 03/21/2023 | EUR | 9,432,655 | 529 | (28,474 | ) | (29,003 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.430 | Annually | 03/21/2023 | EUR | 380,484 | 81 | (1,211 | ) | (1,292 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.432 | Annually | 03/21/2023 | EUR | 1,585,187 | (597 | ) | (5,268 | ) | (4,671 | ) | |||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.433 | Annually | 03/21/2023 | EUR | 1,093,070 | 81 | (3,692 | ) | (3,773 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.435 | Annually | 03/21/2023 | EUR | 846,885 | 255 | (2,976 | ) | (3,231 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.437 | Annually | 03/21/2023 | EUR | 1,250,432 | 78 | (4,525 | ) | (4,603 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.443 | Annually | 03/21/2023 | EUR | 380,376 | 86 | (1,511 | ) | (1,597 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.493 | Annually | 03/21/2023 | EUR | 503,500 | — | (3,494 | ) | (3,494 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.497 | Annually | 03/21/2023 | EUR | 503,500 | — | (3,598 | ) | (3,598 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 0.503 | Annually | 03/21/2023 | EUR | 1,298,000 | — | (9,773 | ) | (9,773 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.004 | Annually | 03/21/2028 | EUR | 554,371 | — | (1,552 | ) | (1,552 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.005 | Annually | 03/21/2028 | EUR | 561,658 | — | (1,638 | ) | (1,638 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.019 | Annually | 03/21/2028 | EUR | 554,371 | — | (2,555 | ) | (2,555 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.020 | Annually | 03/21/2028 | EUR | 554,372 | — | (2,587 | ) | (2,587 | ) | ||||||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.032 | Annually | 03/21/2028 | EUR | 554,372 | — | (3,395 | ) | (3,395 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
25 Invesco Global Targeted Returns Fund
Open Centrally Cleared Interest Rate Swap Agreements(l)—(continued) | ||||||||||||||||||||||||||||||
Pay/Receive Floating Rate | Floating Rate Index | Payment Frequency | (Pay)/ Receive Fixed | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation)(o) | |||||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.035 | % | Annually | 03/21/2028 | EUR | 554,371 | $ | — | $ | (3,557 | ) | $ | (3,557 | ) | ||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.035 | Annually | 03/23/2028 | EUR | 2,217,484 | 818 | (14,207 | ) | (15,025 | ) | ||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.803 | Annually | 03/16/2048 | EUR | 295,000 | — | (336 | ) | (336 | ) | ||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.811 | Annually | 12/15/2047 | EUR | 407,000 | — | (393 | ) | (393 | ) | ||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.880 | Annually | 03/16/2048 | EUR | 607,331 | — | (6,889 | ) | (6,889 | ) | ||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.886 | Annually | 03/16/2048 | EUR | 641,071 | — | (7,739 | ) | (7,739 | ) | ||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.911 | Annually | 03/16/2048 | EUR | 640,397 | — | (9,852 | ) | (9,852 | ) | ||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.915 | Annually | 03/16/2048 | EUR | 624,201 | — | (9,975 | ) | (9,975 | ) | ||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.940 | Annually | 09/15/2047 | EUR | 199,000 | — | (3,362 | ) | (3,362 | ) | ||||||||||||||||||
Receive | 6 Month EUR LIBOR | Semi-Annually | 1.952 | Annually | 12/15/2047 | EUR | 391,000 | — | (7,689 | ) | (7,689 | ) | ||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.693 | Semi-Annually | 09/17/2046 | GBP | 1,178,120 | — | (1,247 | ) | (1,247 | ) | ||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.694 | Semi-Annually | 03/16/2048 | GBP | 300,300 | — | (2,099 | ) | (2,099 | ) | ||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.695 | Semi-Annually | 03/16/2048 | GBP | 300,300 | — | (2,168 | ) | (2,168 | ) | ||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.702 | Semi-Annually | 03/16/2048 | GBP | 309,400 | — | (2,566 | ) | (2,566 | ) | ||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.708 | Semi-Annually | 06/15/2048 | GBP | 442,000 | — | (4,496 | ) | (4,496 | ) | ||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.713 | Semi-Annually | 06/15/2048 | GBP | 442,000 | — | (4,834 | ) | (4,834 | ) | ||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.733 | Semi-Annually | 03/16/2048 | GBP | 267,000 | — | (3,485 | ) | (3,485 | ) | ||||||||||||||||||
Receive | 6 Month GBP LIBOR | Semi-Annually | 1.743 | Semi-Annually | 03/16/2048 | GBP | 267,000 | — | (3,895 | ) | (3,895 | ) | ||||||||||||||||||
Pay | 28 Day MXN TIIE | Monthly | 6.925 | Monthly | 06/16/2021 | MXN | 1,500,000 | — | (512 | ) | (512 | ) | ||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.490 | Quarterly | 06/17/2022 | AUD | 2,022,372 | — | (3,124 | ) | (3,124 | ) | ||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.493 | Quarterly | 06/17/2022 | AUD | 1,862,985 | — | (2,813 | ) | (2,813 | ) | ||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.534 | Quarterly | 03/18/2022 | AUD | 2,454,172 | — | (640 | ) | (640 | ) | ||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.545 | Quarterly | 03/18/2022 | AUD | 2,950,961 | — | (311 | ) | (311 | ) | ||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.560 | Quarterly | 06/17/2022 | AUD | 2,064,896 | — | (1,161 | ) | (1,161 | ) | ||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.565 | Quarterly | 06/17/2022 | AUD | 4,167,854 | — | (2,051 | ) | (2,051 | ) | ||||||||||||||||||
Pay | 3 Month AUD BBSW | Quarterly | 2.570 | Quarterly | 06/17/2022 | AUD | 5,911,893 | — | (2,494 | ) | (2,494 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.030 | Semi-Annually | 12/20/2022 | CAD | 351,536 | — | (5,665 | ) | (5,665 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.038 | Semi-Annually | 12/20/2022 | CAD | 1,282,813 | — | (20,340 | ) | (20,340 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.040 | Semi-Annually | 12/20/2022 | CAD | 1,282,814 | — | (20,229 | ) | (20,229 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.043 | Semi-Annually | 12/20/2022 | CAD | 1,120,930 | — | (17,580 | ) | (17,580 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.045 | Semi-Annually | 12/20/2022 | CAD | 1,795,907 | — | (28,012 | ) | (28,012 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.140 | Semi-Annually | 09/18/2022 | CAD | 509,225 | — | (5,747 | ) | (5,747 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.145 | Semi-Annually | 09/15/2022 | CAD | 1,261,963 | — | (13,988 | ) | (13,988 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.150 | Semi-Annually | 09/15/2022 | CAD | 1,261,963 | — | (13,782 | ) | (13,782 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.153 | Semi-Annually | 09/15/2022 | CAD | 1,261,962 | — | (13,680 | ) | (13,680 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.155 | Semi-Annually | 09/18/2022 | CAD | 1,261,963 | — | (13,625 | ) | (13,625 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.160 | Semi-Annually | 09/18/2022 | CAD | 1,261,962 | — | (13,419 | ) | (13,419 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.163 | Semi-Annually | 09/18/2022 | CAD | 1,261,962 | — | (13,316 | ) | (13,316 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.169 | Semi-Annually | 12/20/2022 | CAD | 1,245,463 | — | (14,109 | ) | (14,109 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.170 | Semi-Annually | 12/20/2022 | CAD | 1,245,462 | — | (14,066 | ) | (14,066 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.174 | Semi-Annually | 12/20/2022 | CAD | 1,245,463 | — | (13,916 | ) | (13,916 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.175 | Semi-Annually | 12/20/2022 | CAD | 2,878,150 | — | (31,997 | ) | (31,997 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.190 | Semi-Annually | 12/20/2022 | CAD | 1,245,462 | — | (13,209 | ) | (13,209 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.340 | Semi-Annually | 06/20/2021 | CAD | 3,377,816 | — | (3,542 | ) | (3,542 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.348 | Semi-Annually | 06/20/2021 | CAD | 3,377,816 | — | (2,968 | ) | (2,968 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.350 | Semi-Annually | 06/20/2021 | CAD | 3,377,816 | — | (2,776 | ) | (2,776 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.355 | Semi-Annually | 06/20/2021 | CAD | 3,377,816 | — | (2,394 | ) | (2,394 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.368 | Semi-Annually | 06/20/2021 | CAD | 3,377,816 | — | (1,437 | ) | (1,437 | ) | ||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.370 | Semi-Annually | 06/20/2021 | CAD | 3,377,816 | — | (1,246 | ) | (1,246 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
26 Invesco Global Targeted Returns Fund
Open Centrally Cleared Interest Rate Swap Agreements(l)—(continued) | ||||||||||||||||||||||||||||||
Pay/Receive Floating Rate | Floating Rate Index | Payment Frequency | (Pay)/ Receive Fixed | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation)(o) | |||||||||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.378 | % | Semi-Annually | 06/20/2021 | CAD | 3,377,816 | $ | — | $ | (672 | ) | $ | (672 | ) | ||||||||||||||
Pay | 3 Month CDOR | Semi-Annually | 2.380 | Semi-Annually | 06/20/2021 | CAD | 3,377,816 | — | (481 | ) | (481 | ) | ||||||||||||||||||
Pay | 3 Month STIBOR | Quarterly | 1.613 | Annually | 09/15/2026 | SEK | 16,053,000 | — | (9,062 | ) | (9,062 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.155 | Semi-Annually | 09/17/2046 | USD | 751,000 | — | (57,987 | ) | (57,987 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.163 | Semi-Annually | 09/17/2046 | USD | 1,123,000 | — | (85,928 | ) | (85,928 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.453 | Semi-Annually | 03/24/2046 | USD | 4,233,688 | — | (223,655 | ) | (223,655 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.510 | Semi-Annually | 06/18/2046 | USD | 491,000 | — | (23,092 | ) | (23,092 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.535 | Semi-Annually | 03/18/2023 | USD | 4,293,033 | — | (60,124 | ) | (60,124 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.538 | Semi-Annually | 03/18/2023 | USD | 9,079,468 | — | (126,563 | ) | (126,563 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.547 | Semi-Annually | 03/18/2023 | USD | 8,578,125 | — | (117,429 | ) | (117,429 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.549 | Semi-Annually | 03/18/2023 | USD | 8,578,125 | — | (116,984 | ) | (116,984 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.549 | Semi-Annually | 03/21/2023 | USD | 5,355,119 | — | (89,779 | ) | (89,779 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.553 | Semi-Annually | 03/18/2023 | USD | 17,156,249 | — | (232,085 | ) | (232,085 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.553 | Semi-Annually | 03/21/2023 | USD | 2,496,881 | — | (41,368 | ) | (41,368 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.591 | Semi-Annually | 09/15/2047 | USD | 131,000 | — | (4,778 | ) | (4,778 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.623 | Semi-Annually | 06/16/2047 | USD | 376,000 | — | (12,946 | ) | (12,946 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.625 | Semi-Annually | 04/28/2046 | USD | 574,000 | — | (21,428 | ) | (21,428 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.691 | Semi-Annually | 12/15/2047 | USD | 515,531 | — | (14,074 | ) | (14,074 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.697 | Semi-Annually | 12/15/2047 | USD | 515,735 | — | (13,843 | ) | (13,843 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.701 | Semi-Annually | 06/20/2021 | USD | 6,035,500 | — | (27,876 | ) | (27,876 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.703 | Semi-Annually | 12/15/2047 | USD | 515,734 | — | (13,590 | ) | (13,590 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.709 | Semi-Annually | 12/15/2047 | USD | 384,000 | — | (9,892 | ) | (9,892 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.713 | Semi-Annually | 06/16/2047 | USD | 959,000 | — | (25,635 | ) | (25,635 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.715 | Semi-Annually | 06/20/2021 | USD | 6,035,500 | — | (25,362 | ) | (25,362 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.779 | Semi-Annually | 03/16/2048 | USD | 450,000 | — | (8,726 | ) | (8,726 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.788 | Semi-Annually | 12/15/2047 | USD | 400,000 | — | (7,667 | ) | (7,667 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.789 | Semi-Annually | 03/16/2048 | USD | 441,551 | — | (8,192 | ) | (8,192 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.794 | Semi-Annually | 03/16/2048 | USD | 450,562 | — | (8,170 | ) | (8,170 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.796 | Semi-Annually | 03/16/2048 | USD | 445,500 | — | (8,003 | ) | (8,003 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.832 | Semi-Annually | 03/18/2023 | USD | 7,064,000 | — | (41,441 | ) | (41,441 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.847 | Semi-Annually | 03/16/2048 | USD | 461,105 | — | (6,290 | ) | (6,290 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.858 | Semi-Annually | 03/16/2048 | USD | 452,509 | — | (5,774 | ) | (5,774 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.863 | Semi-Annually | 03/16/2048 | USD | 452,508 | — | (5,565 | ) | (5,565 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.869 | Semi-Annually | 03/16/2048 | USD | 450,256 | — | (5,310 | ) | (5,310 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.885 | Semi-Annually | 03/16/2048 | USD | 445,753 | — | (4,658 | ) | (4,658 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.895 | Semi-Annually | 03/16/2048 | USD | 450,256 | — | (4,327 | ) | (4,327 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.899 | Semi-Annually | 03/16/2048 | USD | 919,000 | — | (8,586 | ) | (8,586 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 2.938 | Semi-Annually | 03/18/2023 | USD | 10,154,000 | — | (30,103 | ) | (30,103 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 3.005 | Semi-Annually | 03/16/2048 | USD | 1,214,516 | — | (488 | ) | (488 | ) | ||||||||||||||||||
Pay | 3 Month USD LIBOR | Quarterly | 3.023 | Semi-Annually | 06/17/2027 | USD | 1,132,000 | — | (3,047 | ) | (3,047 | ) | ||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 0.371 | Annually | 03/21/2023 | EUR | 1,181,595 | — | (1,335 | ) | (1,335 | ) | ||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 0.372 | Annually | 03/21/2023 | EUR | 2,211,236 | — | (2,372 | ) | (2,372 | ) | ||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 0.377 | Annually | 03/21/2023 | EUR | 4,491,533 | — | (1,784 | ) | (1,784 | ) | ||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 0.382 | Annually | 03/21/2023 | EUR | 8,983,065 | — | (1,249 | ) | (1,249 | ) | ||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.567 | Annually | 03/21/2028 | EUR | 929,635 | 57 | (2,773 | ) | (2,830 | ) | ||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.570 | Annually | 03/21/2028 | EUR | 980,247 | 158 | (2,727 | ) | (2,885 | ) | ||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.575 | Annually | 03/21/2028 | EUR | 971,128 | (44 | ) | (2,428 | ) | (2,384 | ) | |||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.585 | Annually | 03/21/2028 | EUR | 968,975 | 250 | (1,866 | ) | (2,116 | ) | ||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.590 | Annually | 03/21/2028 | EUR | 957,200 | 467 | (1,568 | ) | (2,035 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
27 Invesco Global Targeted Returns Fund
Open Centrally Cleared Interest Rate Swap Agreements(l)—(continued) | ||||||||||||||||||||||||||||||||||||
Pay/Receive Floating Rate | Floating Rate Index | Payment Frequency | (Pay)/ Receive Fixed | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation)(o) | |||||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.592 | % | Annually | 03/21/2028 | EUR | 946,335 | $ | 364 | $ | (1,468 | ) | $ | (1,832 | ) | ||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.593 | Annually | 03/21/2028 | EUR | 1,335,294 | (380 | ) | (1,957 | ) | (1,577 | ) | |||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.594 | Annually | 03/21/2028 | EUR | 1,533,210 | (844 | ) | (2,167 | ) | (1,323 | ) | |||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.595 | Annually | 03/21/2028 | EUR | 949,976 | 342 | (1,283 | ) | (1,625 | ) | ||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.607 | Annually | 03/21/2028 | EUR | 2,393,000 | — | (1,580 | ) | (1,580 | ) | ||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.789 | Annually | 03/16/2048 | EUR | 237,000 | — | (182 | ) | (182 | ) | ||||||||||||||||||||||||
Pay | 6 Month EUR LIBOR | Semi-Annually | 1.804 | Annually | 12/15/2047 | EUR | 250,000 | — | (5 | ) | (5 | ) | ||||||||||||||||||||||||
Pay | 6 Month GBP LIBOR | Semi-Annually | 1.468 | Semi-Annually | 06/16/2047 | GBP | 260,000 | — | (8,028 | ) | (8,028 | ) | ||||||||||||||||||||||||
Pay | 6 Month GBP LIBOR | Semi-Annually | 1.470 | Semi-Annually | 03/17/2047 | GBP | 229,000 | — | (7,245 | ) | (7,245 | ) | ||||||||||||||||||||||||
Pay | 6 Month GBP LIBOR | Semi-Annually | 1.501 | Semi-Annually | 12/15/2047 | GBP | 548,000 | — | (12,994 | ) | (12,994 | ) | ||||||||||||||||||||||||
Pay | 6 Month GBP LIBOR | Semi-Annually | 1.509 | Semi-Annually | 12/15/2047 | GBP | 548,000 | — | (12,303 | ) | (12,303 | ) | ||||||||||||||||||||||||
Pay | 6 Month GBP LIBOR | Semi-Annually | 1.531 | Semi-Annually | 12/15/2047 | GBP | 549,000 | — | (10,465 | ) | (10,465 | ) | ||||||||||||||||||||||||
Pay | 6 Month GBP LIBOR | Semi-Annually | 1.566 | Semi-Annually | 03/17/2047 | GBP | 187,000 | — | (3,126 | ) | (3,126 | ) | ||||||||||||||||||||||||
Pay | 6 Month GBP LIBOR | Semi-Annually | 1.635 | Semi-Annually | 06/15/2048 | GBP | 1,747,000 | — | (1,720 | ) | (1,720 | ) | ||||||||||||||||||||||||
Subtotal — Depreciation |
| 1,975 | (2,246,859 | ) | (2,248,834 | ) | ||||||||||||||||||||||||||||||
Total — Interest Rate Swap Agreements — Interest Rate Risk |
| $ | 1,975 | $ | (585,701 | ) | $ | (587,676 | ) |
(l) | Centrally cleared interest rate swap agreements collateralized by $1,886,774 cash held with Credit Suisse Securities (USA) LLC. |
(o) | The daily variation margin receivable (payable) at period end is recorded in the Consolidated Statement of Assets and Liabilities. |
Open Over-The-Counter Inflation Swap Agreements(p) | ||||||||||||||||||||||||||||||||||||
Counterparty | Pay/Receive Floating Rate | Floating Rate Index | Payment Frequency | Fixed Rate | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation) | ||||||||||||||||||||||||||
Barclays Bank PLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 1.955 | % | At Maturity | 10/18/2026 | USD | 1,314,000 | $ | — | $ | 51,399 | $ | 51,399 | |||||||||||||||||||||
Barclays Bank PLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 1.960 | At Maturity | 10/18/2026 | USD | 1,314,000 | — | 50,769 | 50,769 | |||||||||||||||||||||||||
Barclays Bank PLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 1.995 | At Maturity | 10/19/2026 | USD | 1,314,000 | — | 46,384 | 46,384 | |||||||||||||||||||||||||
Barclays Bank PLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 2.000 | At Maturity | 10/19/2026 | USD | 1,288,000 | — | 44,847 | 44,847 | |||||||||||||||||||||||||
Barclays Bank PLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 2.010 | At Maturity | 10/20/2026 | USD | 1,314,000 | — | 44,522 | 44,522 | |||||||||||||||||||||||||
Barclays Bank PLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 1.993 | At Maturity | 10/21/2026 | USD | 1,288,000 | — | 45,843 | 45,843 | |||||||||||||||||||||||||
Barclays Bank PLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 2.010 | At Maturity | 10/21/2026 | USD | 1,314,000 | — | 44,556 | 44,556 | |||||||||||||||||||||||||
Barclays Bank PLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 1.995 | At Maturity | 10/24/2026 | USD | 1,314,000 | — | 46,557 | 46,557 | |||||||||||||||||||||||||
Barclays Bank PLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 2.225 | At Maturity | 11/16/2026 | USD | 1,825,000 | — | 23,669 | 23,669 | |||||||||||||||||||||||||
Barclays Bank PLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 2.255 | At Maturity | 11/17/2026 | USD | 1,867,000 | — | 18,679 | 18,679 | |||||||||||||||||||||||||
Goldman Sachs International | Receive | United States CPI Urban Consumers NSA | At Maturity | 2.040 | At Maturity | 11/01/2026 | USD | 1,320,000 | — | 41,325 | 41,325 | |||||||||||||||||||||||||
Goldman Sachs International | Receive | United States CPI Urban Consumers NSA | At Maturity | 2.218 | At Maturity | 11/16/2026 | USD | 1,762,000 | — | 24,146 | 24,146 | |||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 2.048 | At Maturity | 11/01/2026 | USD | 1,299,000 | — | 39,727 | 39,727 | |||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 2.249 | At Maturity | 11/16/2026 | USD | 1,493,000 | — | 15,851 | 15,851 | |||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Receive | United States CPI Urban Consumers NSA | At Maturity | 2.259 | At Maturity | 11/16/2026 | USD | 1,276,000 | — | 12,294 | 12,294 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
28 Invesco Global Targeted Returns Fund
Open Over-The-Counter Inflation Swap Agreements(p)—(continued) | ||||||||||||||||||||||||||||||||||||||
Counterparty | Pay/Receive Floating Rate | Floating Rate Index | Payment Frequency | Fixed Rate | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation) | ||||||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Receive | | United States CPI Urban Consumers NSA | | At Maturity | 2.284 | % | At Maturity | 11/16/2026 | USD | 2,776,000 | $ | — | $ | 19,921 | $ | 19,921 | |||||||||||||||||||||
Morgan Stanley Capital Services LLC | Receive | | United States CPI Urban Consumers NSA | | At Maturity | 2.255 | At Maturity | 11/17/2026 | USD | 1,867,000 | — | 18,771 | 18,771 | |||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Pay | United Kingdom RPI | At Maturity | 3.250 | At Maturity | 07/10/2025 | GBP | 830,852 | — | 10,718 | 10,718 | |||||||||||||||||||||||||||
Subtotal — Appreciation |
| — | 599,978 | 599,978 | ||||||||||||||||||||||||||||||||||
Barclays Bank PLC | Receive | United Kingdom RPI | At Maturity | 3.574 | At Maturity | 12/15/2026 | GBP | 3,132,000 | — | (102,207 | ) | (102,207 | ) | |||||||||||||||||||||||||
Barclays Bank PLC | Pay | United Kingdom RPI | At Maturity | 3.106 | At Maturity | 06/15/2026 | GBP | 1,294,000 | — | (55,163 | ) | (55,163 | ) | |||||||||||||||||||||||||
Barclays Bank PLC | Pay | | United States CPI Urban Consumers NSA | | At Maturity | 2.233 | At Maturity | 12/19/2026 | USD | 2,578,000 | — | (29,057 | ) | (29,057 | ) | |||||||||||||||||||||||
Citigroup Global Markets Inc. | Pay | United Kingdom RPI | At Maturity | 2.949 | At Maturity | 09/15/2025 | GBP | 840,423 | — | (32,018 | ) | (32,018 | ) | |||||||||||||||||||||||||
Citigroup Global Markets Inc. | Pay | United Kingdom RPI | At Maturity | 2.801 | At Maturity | 05/15/2026 | GBP | 1,018,000 | — | (84,047 | ) | (84,047 | ) | |||||||||||||||||||||||||
Goldman Sachs International | Pay | United Kingdom RPI | At Maturity | 3.060 | At Maturity | 12/29/2025 | GBP | 3,450,000 | — | (105,918 | ) | (105,918 | ) | |||||||||||||||||||||||||
Goldman Sachs International | Pay | United Kingdom RPI | At Maturity | 2.964 | At Maturity | 03/15/2026 | GBP | 2,298,000 | — | (124,249 | ) | (124,249 | ) | |||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Pay | United Kingdom RPI | At Maturity | 2.923 | At Maturity | 02/27/2025 | GBP | 11,857,170 | — | (222,759 | ) | (222,759 | ) | |||||||||||||||||||||||||
Subtotal — Depreciation |
| — | (755,418 | ) | (755,418 | ) | ||||||||||||||||||||||||||||||||
Subtotal — Over-The-Counter Inflation Swap Agreements |
| $ | — | $ | (155,440 | ) | $ | (155,440 | ) |
Centrally Cleared Inflation Swap Agreements(p) | ||||||||||||||||||||||||||||||||||
Pay/Receive Floating Rate | Floating Rate Index | Payment Frequency | Fixed Rate | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation)(q) | |||||||||||||||||||||||||
Receive | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.176 | % | At Maturity | 07/15/2022 | EUR | 2,754,047 | $ | — | $ | 36,635 | $ | 36,635 | ||||||||||||||||||||
Receive | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.180 | At Maturity | 07/15/2022 | EUR | 2,666,152 | — | 34,795 | 34,795 | ||||||||||||||||||||||||
Receive | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.202 | At Maturity | 07/15/2022 | EUR | 3,984,578 | — | 46,563 | 46,563 | ||||||||||||||||||||||||
Receive | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.222 | At Maturity | 07/15/2022 | EUR | 3,999,227 | — | 41,490 | 41,490 | ||||||||||||||||||||||||
Receive | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.310 | At Maturity | 08/15/2022 | EUR | 6,650,145 | — | 48,250 | 48,250 | ||||||||||||||||||||||||
Receive | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.315 | At Maturity | 08/15/2022 | EUR | 2,996,344 | — | 20,750 | 20,750 | ||||||||||||||||||||||||
Receive | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.520 | At Maturity | 04/15/2028 | EUR | 1,201,000 | — | 4,880 | 4,880 | ||||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.420 | At Maturity | 06/15/2047 | GBP | 23,000 | — | 229 | 229 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.069 | At Maturity | 08/25/2027 | USD | 220,120 | — | 7,187 | 7,187 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.074 | At Maturity | 08/23/2027 | USD | 436,000 | — | 14,022 | 14,022 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.079 | At Maturity | 08/22/2027 | USD | 237,000 | — | 7,504 | 7,504 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.082 | At Maturity | 08/24/2027 | USD | 436,000 | — | 13,685 | 13,685 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.093 | At Maturity | 08/21/2027 | USD | 948,000 | — | 28,734 | 28,734 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.123 | At Maturity | 10/19/2027 | USD | 617,000 | — | 17,879 | 17,879 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.131 | At Maturity | 10/19/2027 | USD | 617,000 | — | 17,382 | 17,382 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
29 Invesco Global Targeted Returns Fund
Centrally Cleared Inflation Swap Agreements(p)—(continued) | ||||||||||||||||||||||||||||||||||
Pay/Receive Floating Rate | Floating Rate Index | Payment Frequency | Fixed Rate | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation)(q) | |||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.131 | % | At Maturity | 10/23/2027 | USD | 308,000 | $ | — | $ | 8,617 | $ | 8,617 | ||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.147 | At Maturity | 04/25/2027 | USD | 198,000 | — | 3,565 | 3,565 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.148 | At Maturity | 10/20/2027 | USD | 617,000 | — | 16,390 | 16,390 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.150 | At Maturity | 10/20/2027 | USD | 308,000 | — | 8,109 | 8,109 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.199 | At Maturity | 04/26/2027 | USD | 397,000 | — | 5,149 | 5,149 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.294 | At Maturity | 01/12/2027 | USD | 866,000 | — | 4,574 | 4,574 | ||||||||||||||||||||||||
Receive | United States CPI Urban Consumers NSA | At Maturity | 2.300 | At Maturity | 01/12/2027 | USD | 866,000 | — | 4,064 | 4,064 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.352 | At Maturity | 10/15/2027 | GBP | 1,109,860 | — | 11,684 | 11,684 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.353 | At Maturity | 08/15/2027 | GBP | 426,036 | — | 400 | 400 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.370 | At Maturity | 06/15/2027 | GBP | 255,000 | — | 770 | 770 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.374 | At Maturity | 08/15/2027 | GBP | 972,670 | — | 4,339 | 4,339 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.378 | At Maturity | 08/15/2027 | GBP | 972,670 | — | 4,945 | 4,945 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.381 | At Maturity | 10/15/2027 | GBP | 1,700,380 | — | 25,944 | 25,944 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.388 | At Maturity | 10/15/2027 | GBP | 2,280,760 | — | 37,537 | 37,537 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.411 | At Maturity | 05/15/2027 | GBP | 1,022,000 | — | 14,027 | 14,027 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.430 | At Maturity | 04/15/2048 | GBP | 91,000 | — | 1,435 | 1,435 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.480 | At Maturity | 12/15/2047 | GBP | 110,000 | — | 4,922 | 4,922 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.480 | At Maturity | 02/15/2048 | GBP | 125,000 | — | 7,270 | 7,270 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.480 | At Maturity | 03/15/2048 | GBP | 47,000 | — | 2,276 | 2,276 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.483 | At Maturity | 10/15/2047 | GBP | 111,000 | — | 6,148 | 6,148 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.485 | At Maturity | 06/15/2047 | GBP | 102,000 | — | 4,022 | 4,022 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.505 | At Maturity | 09/15/2047 | GBP | 131,000 | — | 8,576 | 8,576 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.630 | At Maturity | 01/15/2027 | GBP | 644,421 | — | 28,198 | 28,198 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.633 | At Maturity | 01/15/2027 | GBP | 885,159 | — | 39,186 | 39,186 | ||||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.635 | At Maturity | 01/15/2027 | GBP | 644,420 | — | 28,749 | 28,749 | ||||||||||||||||||||||||
Subtotal — Appreciation |
| — | 620,881 | 620,881 | ||||||||||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.312 | At Maturity | 04/15/2028 | GBP | 1,279,000 | — | (1,785 | ) | (1,785 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.350 | At Maturity | 02/15/2028 | GBP | 1,420,000 | — | (15,999 | ) | (15,999 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.353 | At Maturity | 10/15/2027 | GBP | 1,269,000 | — | (13,385 | ) | (13,385 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.365 | At Maturity | 12/15/2027 | GBP | 1,258,000 | — | (7,395 | ) | (7,395 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.379 | At Maturity | 03/15/2028 | GBP | 303,000 | — | (2,818 | ) | (2,818 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.390 | At Maturity | 09/15/2027 | GBP | 1,479,000 | — | (18,159 | ) | (18,159 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.423 | At Maturity | 06/15/2027 | GBP | 1,100,000 | — | (12,942 | ) | (12,942 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.443 | At Maturity | 08/15/2047 | GBP | 34,066 | — | (303 | ) | (303 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.453 | At Maturity | 08/15/2047 | GBP | 68,926 | — | (1,134 | ) | (1,134 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.454 | At Maturity | 08/15/2047 | GBP | 67,943 | — | (1,183 | ) | (1,183 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.458 | At Maturity | 08/15/2047 | GBP | 34,463 | — | (698 | ) | (698 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.478 | At Maturity | 08/15/2047 | GBP | 80,661 | — | (2,900 | ) | (2,900 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.480 | At Maturity | 08/15/2047 | GBP | 80,661 | — | (3,016 | ) | (3,016 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.495 | At Maturity | 10/15/2047 | GBP | 85,540 | — | (5,523 | ) | (5,523 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.505 | At Maturity | 02/15/2027 | GBP | 1,235,000 | — | (32,729 | ) | (32,729 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.518 | At Maturity | 10/15/2047 | GBP | 143,957 | — | (11,836 | ) | (11,836 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.524 | At Maturity | 05/15/2047 | GBP | 458,250 | — | (33,733 | ) | (33,733 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.531 | At Maturity | 10/15/2047 | GBP | 200,503 | — | (18,634 | ) | (18,634 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
30 Invesco Global Targeted Returns Fund
Centrally Cleared Inflation Swap Agreements(p)—(continued) | ||||||||||||||||||||||||||||||||||
Pay/Receive Floating Rate | Floating Rate Index | Payment Frequency | Fixed Rate | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation)(q) | |||||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.549 | % | At Maturity | 05/15/2047 | GBP | 458,250 | $ | — | $ | (42,696 | ) | $ | (42,696 | ) | ||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.552 | At Maturity | 05/15/2047 | GBP | 458,250 | — | (43,770 | ) | (43,770 | ) | ||||||||||||||||||||||
Receive | United Kingdom RPI | At Maturity | 3.564 | At Maturity | 05/15/2047 | GBP | 458,250 | — | (48,244 | ) | (48,244 | ) | ||||||||||||||||||||||
Pay | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.334 | At Maturity | 06/15/2027 | EUR | 338,000 | — | (8,491 | ) | (8,491 | ) | ||||||||||||||||||||||
Pay | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.370 | At Maturity | 04/15/2023 | EUR | 890,000 | — | (1,784 | ) | (1,784 | ) | ||||||||||||||||||||||
Pay | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.375 | At Maturity | 07/15/2027 | EUR | 2,754,047 | — | (53,102 | ) | (53,102 | ) | ||||||||||||||||||||||
Pay | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.380 | At Maturity | 07/15/2027 | EUR | 2,666,152 | — | (49,706 | ) | (49,706 | ) | ||||||||||||||||||||||
Pay | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.388 | At Maturity | 07/15/2027 | EUR | 3,984,578 | — | (70,003 | ) | (70,003 | ) | ||||||||||||||||||||||
Pay | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.406 | At Maturity | 07/15/2027 | EUR | 3,999,227 | — | (61,452 | ) | (61,452 | ) | ||||||||||||||||||||||
Pay | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.462 | At Maturity | 08/15/2027 | EUR | 6,650,145 | — | (71,036 | ) | (71,036 | ) | ||||||||||||||||||||||
Pay | Eurostat Eurozone HICP Ex Tobacco Unrevised Series NSA | At Maturity | 1.465 | At Maturity | 08/15/2027 | EUR | 2,996,344 | — | (31,005 | ) | (31,005 | ) | ||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.321 | At Maturity | 08/15/2027 | GBP | 334,383 | — | (1,428 | ) | (1,428 | ) | ||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.335 | At Maturity | 08/15/2027 | GBP | 839,930 | — | (1,644 | ) | (1,644 | ) | ||||||||||||||||||||||
Pay | United Kingdom RPI | At Maturity | 3.343 | At Maturity | 08/15/2027 | GBP | 852,071 | — | (610 | ) | (610 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.055 | At Maturity | 06/08/2027 | USD | 3,860,000 | — | (119,723 | ) | (119,723 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.081 | At Maturity | 05/18/2027 | USD | 3,154,000 | — | (83,868 | ) | (83,868 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.093 | At Maturity | 06/07/2027 | USD | 819,000 | — | (22,427 | ) | (22,427 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.120 | At Maturity | 05/12/2027 | USD | 3,231,000 | — | (71,359 | ) | (71,359 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.133 | At Maturity | 05/15/2027 | USD | 1,117,000 | — | (23,973 | ) | (23,973 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.135 | At Maturity | 05/11/2027 | USD | 890,000 | — | (18,264 | ) | (18,264 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.138 | At Maturity | 05/11/2027 | USD | 1,574,000 | — | (31,922 | ) | (31,922 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.144 | At Maturity | 05/11/2027 | USD | 1,574,000 | — | (30,940 | ) | (30,940 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.165 | At Maturity | 10/25/2027 | USD | 693,000 | — | (17,111 | ) | (17,111 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.170 | At Maturity | 09/18/2027 | USD | 437,000 | — | (10,642 | ) | (10,642 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.174 | At Maturity | 12/13/2027 | USD | 590,000 | — | (12,054 | ) | (12,054 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.281 | At Maturity | 03/01/2027 | USD | 919,000 | — | (5,885 | ) | (5,885 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.315 | At Maturity | 03/15/2028 | USD | 147,000 | — | (930 | ) | (930 | ) | ||||||||||||||||||||||
Pay | United States CPI Urban Consumers NSA | At Maturity | 2.342 | At Maturity | 04/16/2028 | USD | 439,000 | — | (1,157 | ) | (1,157 | ) | ||||||||||||||||||||||
Subtotal — Depreciation |
| — | (1,119,398 | ) | (1,119,398 | ) | ||||||||||||||||||||||||||||
Subtotal — Centrally Cleared Inflation Swap Agreements |
| — | (498,517 | ) | (498,517 | ) | ||||||||||||||||||||||||||||
Total — Interest Rate and Inflation Swap Agreements — Interest Rate Risk |
| $ | 1,975 | $ | (1,239,658 | ) | $ | (1,241,633 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
31 Invesco Global Targeted Returns Fund
(p) | Centrally cleared inflation swap agreements collateralized by $969,916 cash held with Credit Suisse Securities (USA) LLC. |
(q) | The daily variation margin receivable (payable) at period end is recorded in the Consolidated Statement of Assets and Liabilities. |
Open Over-The-Counter Variance Swap Agreements | ||||||||||||||||||||||||||||
Counterparty | Reference Entity | Pay/ Receive | Volatility Strike Rate | Payment Frequency | Maturity Date | Notional Value | Unrealized Appreciation (Depreciation) | |||||||||||||||||||||
BNP Paribas S.A. | S&P 500 Index | Pay | 17.65 | % | At Maturity | 12/21/2018 | USD | 6,188 | $ | 11,409 | ||||||||||||||||||
BNP Paribas S.A. | S&P 500 Index | Pay | 17.75 | At Maturity | 12/21/2018 | USD | 2,071 | 3,808 | ||||||||||||||||||||
Citigroup Global Markets Inc. | S&P 500 Index | Pay | 15.40 | At Maturity | 06/15/2018 | USD | 2,788 | 4,117 | ||||||||||||||||||||
Citigroup Global Markets Inc. | S&P 500 Index | Pay | 16.26 | At Maturity | 06/15/2018 | USD | 2,334 | 5,638 | ||||||||||||||||||||
Citigroup Global Markets Inc. | S&P 500 Index | Pay | 16.65 | At Maturity | 12/21/2018 | USD | 3,485 | 2,215 | ||||||||||||||||||||
Citigroup Global Markets Inc. | S&P 500 Index | Pay | 17.41 | At Maturity | 12/21/2018 | USD | 3,890 | 5,792 | ||||||||||||||||||||
Citigroup Global Markets Inc. | S&P 500 Index | Pay | 17.55 | At Maturity | 12/21/2018 | USD | 3,886 | 8,464 | ||||||||||||||||||||
J.P. Morgan Chase Bank, N.A. | S&P 500 Index | Pay | 17.31 | At Maturity | 12/21/2018 | USD | 2,784 | 1,195 | ||||||||||||||||||||
J.P. Morgan Chase Bank, N.A. | S&P 500 Index | Pay | 17.45 | At Maturity | 12/21/2018 | USD | 4,851 | 3,673 | ||||||||||||||||||||
J.P. Morgan Chase Bank, N.A. | S&P 500 Index | Pay | 17.95 | At Maturity | 12/21/2018 | USD | 23,318 | 60,118 | ||||||||||||||||||||
J.P. Morgan Chase Bank, N.A. | S&P 500 Index | Pay | 18.58 | At Maturity | 12/21/2018 | USD | 2,374 | 379 | ||||||||||||||||||||
Societe Generale | KOSPI 200 Index | Pay | 20.00 | At Maturity | 12/13/2018 | KRW | 7,789,108 | 26,916 | ||||||||||||||||||||
Societe Generale | S&P 500 Index | Pay | 14.95 | At Maturity | 06/15/2018 | USD | 3,269 | 2,922 | ||||||||||||||||||||
Societe Generale | S&P 500 Index | Pay | 15.90 | At Maturity | 06/15/2018 | USD | 2,617 | 4,374 | ||||||||||||||||||||
Societe Generale | S&P 500 Index | Pay | 16.85 | At Maturity | 12/21/2018 | USD | 4,362 | 2,682 | ||||||||||||||||||||
Societe Generale | S&P 500 Index | Pay | 17.36 | At Maturity | 12/21/2018 | USD | 9,742 | 4,866 | ||||||||||||||||||||
Societe Generale | S&P 500 Index | Pay | 17.70 | At Maturity | 12/21/2018 | USD | 23,318 | 54,952 | ||||||||||||||||||||
Societe Generale | S&P 500 Index | Pay | 17.80 | At Maturity | 12/21/2018 | USD | 7,772 | 18,594 | ||||||||||||||||||||
Societe Generale | S&P 500 Index | Pay | 18.15 | At Maturity | 12/21/2018 | USD | 2,666 | 6,362 | ||||||||||||||||||||
UBS | KOSPI 200 Index | Pay | 19.00 | At Maturity | 12/13/2018 | KRW | 7,721,467 | 20,358 | ||||||||||||||||||||
UBS | KOSPI 200 Index | Pay | 19.60 | At Maturity | 12/13/2018 | KRW | 7,712,584 | 25,389 | ||||||||||||||||||||
UBS | KOSPI 200 Index | Pay | 19.70 | At Maturity | 12/13/2018 | KRW | 4,834,372 | 16,280 | ||||||||||||||||||||
UBS | KOSPI 200 Index | Pay | 20.30 | At Maturity | 12/13/2018 | KRW | 13,155,600 | 58,263 | ||||||||||||||||||||
UBS | S&P 500 Index | Pay | 14.80 | At Maturity | 06/15/2018 | USD | 4,359 | 3,279 | ||||||||||||||||||||
UBS | S&P 500 Index | Pay | 15.25 | At Maturity | 06/15/2018 | USD | 2,091 | 2,803 | ||||||||||||||||||||
UBS | S&P 500 Index | Pay | 15.61 | At Maturity | 06/15/2018 | USD | 2,701 | 4,820 | ||||||||||||||||||||
UBS | S&P 500 Index | Pay | 15.90 | At Maturity | 06/15/2018 | USD | 3,490 | 5,833 | ||||||||||||||||||||
UBS | S&P 500 Index | Pay | 16.96 | At Maturity | 12/21/2018 | USD | 4,501 | 4,601 | ||||||||||||||||||||
UBS | S&P 500 Index | Pay | 17.20 | At Maturity | 12/21/2018 | USD | 9,701 | 5,039 | ||||||||||||||||||||
UBS | S&P 500 Index | Pay | 17.40 | At Maturity | 12/21/2018 | USD | 3,742 | 7,664 | ||||||||||||||||||||
UBS | S&P 500 Index | Pay | 17.60 | At Maturity | 12/21/2018 | USD | 3,887 | 8,633 | ||||||||||||||||||||
UBS | S&P 500 Index | Pay | 18.00 | At Maturity | 12/21/2018 | USD | 24,915 | 63,773 | ||||||||||||||||||||
Subtotal — Appreciation | 455,211 | |||||||||||||||||||||||||||
BNP Paribas S.A. | KOSPI 200 Index | Receive | 19.89 | At Maturity | 12/13/2018 | KRW | 3,322,882 | (13,277 | ) | |||||||||||||||||||
BNP Paribas S.A. | KOSPI 200 Index | Receive | 20.19 | At Maturity | 12/13/2018 | KRW | 3,470,917 | (14,239 | ) | |||||||||||||||||||
BNP Paribas S.A. | S&P/ASX 200 Index | Receive | 15.75 | At Maturity | 12/20/2018 | AUD | 4,923 | (7,614 | ) | |||||||||||||||||||
Citigroup Global Markets Inc. | | Hang Seng China Enterprise Index | | Receive | 22.72 | At Maturity | 06/28/2018 | HKD | 20,501 | (4,302 | ) | |||||||||||||||||
Citigroup Global Markets Inc. | Hang Seng Index | Receive | 19.87 | At Maturity | 06/28/2018 | HKD | 19,853 | (7,072 | ) | |||||||||||||||||||
Citigroup Global Markets Inc. | KOSPI 200 Index | Receive | 18.72 | At Maturity | 12/13/2018 | KRW | 1,008,074 | (2,890 | ) | |||||||||||||||||||
Citigroup Global Markets Inc. | KOSPI 200 Index | Receive | 19.59 | At Maturity | 12/13/2018 | KRW | 2,276,485 | (8,282 | ) | |||||||||||||||||||
Citigroup Global Markets Inc. | KOSPI 200 Index | Receive | 19.85 | At Maturity | 12/13/2018 | KRW | 4,414,436 | (18,742 | ) | |||||||||||||||||||
Citigroup Global Markets Inc. | S&P 500 Index | Receive | 17.62 | At Maturity | 12/21/2018 | USD | 14,398 | (13,881 | ) | |||||||||||||||||||
J.P. Morgan Chase Bank, N.A. | | Hang Seng China Enterprise Index | | Receive | 23.99 | At Maturity | 06/28/2018 | HKD | 15,696 | (4,924 | ) | |||||||||||||||||
J.P. Morgan Chase Bank, N.A. | | Hang Seng China Enterprise Index | | Receive | 25.59 | At Maturity | 12/28/2018 | HKD | 13,305 | (3,209 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
32 Invesco Global Targeted Returns Fund
Open Over-The-Counter Variance Swap Agreements—(continued) | ||||||||||||||||||||||||
Counterparty | Reference Entity | Pay/ Receive | Volatility Strike Rate | Payment Frequency | Maturity Date | Notional Value | Unrealized Appreciation (Depreciation) | |||||||||||||||||
J.P. Morgan Chase Bank, N.A. | Hang Seng Index | Receive | 21.09 | % | At Maturity | 12/28/2018 | HKD | 13,915 | $ | (1,782 | ) | |||||||||||||
J.P. Morgan Chase Bank, N.A. | Hang Seng Index | Receive | 21.43 | At Maturity | 12/28/2018 | HKD | 34,156 | (4,583 | ) | |||||||||||||||
J.P. Morgan Chase Bank, N.A. | Hang Seng Index | Receive | 21.50 | At Maturity | 12/28/2018 | HKD | 35,751 | (8,222 | ) | |||||||||||||||
J.P. Morgan Chase Bank, N.A. | Hang Seng Index | Receive | 21.85 | At Maturity | 12/28/2018 | HKD | 25,293 | (6,035 | ) | |||||||||||||||
J.P. Morgan Chase Bank, N.A. | Hang Seng Index | Receive | 22.39 | At Maturity | 12/28/2018 | HKD | 40,215 | (13,977 | ) | |||||||||||||||
J.P. Morgan Chase Bank, N.A. | Hang Seng Index | Receive | �� | 22.44 | At Maturity | 12/28/2018 | HKD | 11,809 | (3,968 | ) | ||||||||||||||
J.P. Morgan Chase Bank, N.A. | KOSPI 200 Index | Receive | 18.79 | At Maturity | 12/13/2018 | KRW | 26,414,363 | (89,277 | ) | |||||||||||||||
J.P. Morgan Chase Bank, N.A. | S&P/ASX 200 Index | Receive | 14.28 | At Maturity | 12/20/2018 | AUD | 4,715 | (330 | ) | |||||||||||||||
J.P. Morgan Chase Bank, N.A. | S&P/ASX 200 Index | Receive | 14.50 | At Maturity | 12/20/2018 | AUD | 4,716 | (965 | ) | |||||||||||||||
J.P. Morgan Chase Bank, N.A. | S&P/ASX 200 Index | Receive | 15.59 | At Maturity | 12/20/2018 | AUD | 4,403 | (5,684 | ) | |||||||||||||||
Societe Generale | Hang Seng China Enterprise Index | Receive | 25.95 | At Maturity | 12/28/2018 | HKD | 25,936 | (7,881 | ) | |||||||||||||||
Societe Generale | Hang Seng China Enterprise Index | Receive | 26.00 | At Maturity | 12/28/2018 | HKD | 25,936 | (8,029 | ) | |||||||||||||||
Societe Generale | Hang Seng Index | Receive | 19.00 | At Maturity | 06/28/2018 | HKD | 29,185 | (6,269 | ) | |||||||||||||||
Societe Generale | Hang Seng Index | Receive | 20.63 | At Maturity | 06/28/2018 | HKD | 12,274 | (4,652 | ) | |||||||||||||||
Societe Generale | KOSPI 200 Index | Receive | 18.35 | At Maturity | 12/13/2018 | KRW | 3,878,625 | (9,946 | ) | |||||||||||||||
Societe Generale | KOSPI 200 Index | Receive | 19.00 | At Maturity | 12/13/2018 | KRW | 17,608,798 | (62,264 | ) | |||||||||||||||
Societe Generale | KOSPI 200 Index | Receive | 19.40 | At Maturity | 12/13/2018 | KRW | 8,794,672 | (34,405 | ) | |||||||||||||||
Societe Generale | KOSPI 200 Index | Receive | 19.90 | At Maturity | 12/13/2018 | KRW | 8,824,892 | (37,780 | ) | |||||||||||||||
Societe Generale | KOSPI 200 Index | Receive | 19.97 | At Maturity | 12/13/2018 | KRW | 4,560,014 | (18,895 | ) | |||||||||||||||
Societe Generale | KOSPI 200 Index | Receive | 20.28 | At Maturity | 12/13/2018 | KRW | 4,951,830 | (19,853 | ) | |||||||||||||||
UBS | Hang Seng China Enterprise Index | Receive | 22.28 | At Maturity | 06/28/2018 | HKD | 51,884 | (7,229 | ) | |||||||||||||||
UBS | Hang Seng China Enterprise Index | Receive | 24.35 | At Maturity | 06/28/2018 | HKD | 16,365 | (5,900 | ) | |||||||||||||||
UBS | Hang Seng China Enterprise Index | Receive | 25.00 | At Maturity | 12/28/2018 | HKD | 51,858 | (8,846 | ) | |||||||||||||||
UBS | Hang Seng China Enterprise Index | Receive | 25.30 | At Maturity | 12/28/2018 | HKD | 51,871 | (13,550 | ) | |||||||||||||||
UBS | Hang Seng China Enterprise Index | Receive | 26.04 | At Maturity | 12/28/2018 | HKD | 103,115 | (34,586 | ) | |||||||||||||||
UBS | Hang Seng Index | Receive | 19.29 | At Maturity | 06/28/2018 | HKD | 21,916 | (5,748 | ) | |||||||||||||||
UBS | Hang Seng Index | Receive | 19.49 | At Maturity | 06/28/2018 | HKD | 18,235 | (5,526 | ) | |||||||||||||||
UBS | Hang Seng Index | Receive | 21.48 | At Maturity | 12/28/2018 | HKD | 28,725 | (4,200 | ) | |||||||||||||||
UBS | Hang Seng Index | �� | Receive | 21.68 | At Maturity | 12/28/2018 | HKD | 28,721 | (6,721 | ) | ||||||||||||||
UBS | Hang Seng Index | Receive | 21.79 | At Maturity | 12/28/2018 | HKD | 18,601 | (5,394 | ) | |||||||||||||||
UBS | KOSPI 200 Index | Receive | 18.60 | At Maturity | 12/13/2018 | KRW | 17,588,568 | (58,455 | ) | |||||||||||||||
UBS | KOSPI 200 Index | Receive | 19.30 | At Maturity | 12/13/2018 | KRW | 10,458,789 | (40,008 | ) | |||||||||||||||
UBS | KOSPI 200 Index | Receive | 19.44 | At Maturity | 12/13/2018 | KRW | 1,758,023 | (6,123 | ) | |||||||||||||||
UBS | KOSPI 200 Index | Receive | 19.80 | At Maturity | 12/13/2018 | KRW | 4,414,527 | (18,585 | ) | |||||||||||||||
UBS | KOSPI 200 Index | Receive | 19.95 | At Maturity | 12/13/2018 | KRW | 5,617,288 | (23,797 | ) | |||||||||||||||
UBS | S&P/ASX 200 Index | Receive | 14.38 | At Maturity | 12/20/2018 | AUD | 3,773 | (376 | ) | |||||||||||||||
UBS | S&P/ASX 200 Index | Receive | 15.55 | At Maturity | 12/20/2018 | AUD | 11,600 | (16,788 | ) | |||||||||||||||
UBS | S&P/ASX 200 Index | Receive | 15.65 | At Maturity | 12/20/2018 | AUD | 21,214 | (32,419 | ) | |||||||||||||||
UBS | S&P/ASX 200 Index | Receive | 15.69 | At Maturity | 12/20/2018 | AUD | 4,922 | (7,484 | ) | |||||||||||||||
UBS | S&P/ASX 200 Index | Receive | 15.77 | At Maturity | 12/20/2018 | AUD | 4,922 | (7,676 | ) | |||||||||||||||
UBS | S&P/ASX 200 Index | Receive | 16.03 | At Maturity | 12/20/2018 | AUD | 6,961 | (11,944 | ) | |||||||||||||||
Goldman Sachs International | S&P 500 Index | Pay | 16.65 | At Maturity | 12/21/2018 | USD | 15,210 | (21,637 | ) | |||||||||||||||
J.P. Morgan Chase Bank, N.A. | S&P 500 Index | Pay | 16.55 | At Maturity | 12/21/2018 | USD | 892 | (917 | ) | |||||||||||||||
J.P. Morgan Chase Bank, N.A. | S&P 500 Index | Pay | 16.70 | At Maturity | 12/21/2018 | USD | 5,204 | (3,537 | ) | |||||||||||||||
J.P. Morgan Chase Bank, N.A. | S&P 500 Index | Pay | 16.90 | At Maturity | 12/21/2018 | USD | 6,548 | (633 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
33 Invesco Global Targeted Returns Fund
Open Over-The-Counter Variance Swap Agreements—(continued) | ||||||||||||||||||||||||||||
Counterparty | Reference Entity | Pay/ Receive | Volatility Strike Rate | Payment Frequency | Maturity Date | Notional Value | Unrealized Appreciation (Depreciation) | |||||||||||||||||||||
J.P. Morgan Chase Bank, N.A. | S&P 500 Index | Pay | 18.09 | % | At Maturity | 12/21/2018 | USD | 2,373 | $ | (646 | ) | |||||||||||||||||
Societe Generale | S&P 500 Index | Pay | 15.95 | At Maturity | 12/21/2018 | USD | 5,448 | (958 | ) | |||||||||||||||||||
Societe Generale | S&P 500 Index | Pay | 16.41 | At Maturity | 12/21/2018 | USD | 2,343 | (4,905 | ) | |||||||||||||||||||
UBS | S&P 500 Index | Pay | 15.25 | At Maturity | 12/21/2018 | USD | 3,810 | (15,886 | ) | |||||||||||||||||||
UBS | S&P 500 Index | Pay | 15.35 | At Maturity | 12/21/2018 | USD | 10,698 | (42,907 | ) | |||||||||||||||||||
UBS | S&P 500 Index | Pay | 17.75 | At Maturity | 12/21/2018 | USD | 6,906 | (526 | ) | |||||||||||||||||||
UBS | S&P 500 Index | Pay | 18.05 | At Maturity | 12/21/2018 | USD | 1,629 | (566 | ) | |||||||||||||||||||
Subtotal — Depreciation | (857,702 | ) | ||||||||||||||||||||||||||
Total — Variance Swap Agreements — Equity Risk |
| $ | (402,491 | ) |
Open Over-The-Counter Total Return Swap Agreements(r) | ||||||||||||||||||||||||||||||||||||
Counterparty | Pay/ Receive | Reference Entity(s) | Fixed Rate | Payment Frequency | Number of Contracts | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized (Depreciation) | ||||||||||||||||||||||||||
Macquarie Bank Ltd. | Pay | Macquarie MQCP575 Index | 0.25 | % | Monthly | 5,528 | 02/21/2019 | USD | 986,962 | $ | — | $ | 156 | $ | 156 | |||||||||||||||||||||
Macquarie Bank Ltd. | Pay | Macquarie MQCP252 Index | 0.12 | Monthly | 49,221 | 02/21/2019 | USD | 5,578,477 | — | 61,802 | 61,802 | |||||||||||||||||||||||||
BNP Paribas S.A. | Receive | BNP Paribas DR Alpha ex-Agriculture and Livestock Index | 0.15 | Monthly | 21,693 | 06/25/2018 | USD | 6,463,195 | — | 2,097 | 2,097 | |||||||||||||||||||||||||
Subtotal — Commodity Risk |
| — | 64,055 | 64,055 | ||||||||||||||||||||||||||||||||
Goldman Sachs International | Pay | Mexican Bolsa Index | — | Monthly | 490 | 06/15/2018 | MXN | 24,125,353 | — | 1,655 | 1,655 | |||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Pay | Morgan Stanley Systematic 5-Month Dispersion Index | 0.10 | Monthly | 1,218 | 04/09/2019 | USD | 231,695 | — | 841 | 841 | |||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Receive | Morgan Stanley Systematic 5-Month Dispersion Index | 0.10 | Monthly | 30,027 | 04/09/2019 | USD | 5,685,312 | — | 5,104 | 5,104 | |||||||||||||||||||||||||
Subtotal — Equity Risk |
| — | 7,600 | 7,600 | ||||||||||||||||||||||||||||||||
Subtotal — Appreciation |
| — | 71,655 | 71,655 | ||||||||||||||||||||||||||||||||
BNP Paribas S.A. | Pay | BNP Paribas DR Alpha ex-Agriculture and Livestock Index | 0.15 | Monthly | 4,530 | 06/25/2018 | USD | 1,349,665 | — | (438 | ) | (438 | ) | |||||||||||||||||||||||
Macquarie Bank Ltd. | Receive | Macquarie MQCP575 Index | 0.25 | Monthly | 120,686 | 02/21/2019 | USD | 21,547,122 | — | (3,404 | ) | (3,404 | ) | |||||||||||||||||||||||
Macquarie Bank Ltd. | Receive | Macquarie MQCP252 Index | 0.12 | Monthly | 4,177 | 02/21/2019 | USD | 472,677 | — | (4,520 | ) | (4,520 | ) | |||||||||||||||||||||||
Subtotal — Commodity Risk |
| — | (8,362 | ) | (8,362 | ) | ||||||||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Pay | Morgan Stanley Systematic 6-Month European Dispersion Index | 0.10 | Monthly | 786 | 09/212018 | EUR | 128,237 | — | (66 | ) | (66 | ) | |||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Pay | Morgan Stanley Systematic 6-Month European Dispersion (Wednesday) Index | 0.10 | Monthly | 777 | 09/21/2018 | EUR | 127,646 | — | (28 | ) | (28 | ) | |||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Receive | Morgan Stanley Systematic 6-Month European Dispersion Index | 0.10 | Monthly | 4,181 | 09/21/2018 | EUR | 682,130 | — | (353 | ) | (353 | ) | |||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Receive | Morgan Stanley Systematic 6-Month European Dispersion (Wednesday) Index | 0.10 | Monthly | 4,148 | 09/21/2018 | EUR | 681,433 | — | (150 | ) | (150 | ) | |||||||||||||||||||||||
Subtotal — Equity Risk |
| — | (597 | ) | (597 | ) | ||||||||||||||||||||||||||||||
Subtotal — Depreciation |
| — | (8,959 | ) | (8,959 | ) | ||||||||||||||||||||||||||||||
Total Over-The-Counter Total Return Swap Agreements |
| $ | — | $ | 62,696 | $ | 62,696 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
34 Invesco Global Targeted Returns Fund
Index Information:
Morgan Stanley Systematic 6-Month European Dispersion Index | – An index comprising cash, equity securities, options on equity securities and stock market index futures. | |
Morgan Stanley Systematic 6-Month European Dispersion (Wednesday) Index | – An index comprising cash, equity securities, options on equity securities and stock market index futures. |
(r) | The Fund receives or pays payments based on any positive or negative return on the Reference Entity, respectively. |
(s) | The tables below include additional information regarding the underlying components of certain reference entities that are not publicly available. |
Reference Entity Components | ||||||
Reference Entity | Underlying Components | Percentage | ||||
Macquarie MQCP575 Index |
| |||||
Long Futures Contracts | ||||||
Aluminum | 13.76 | % | ||||
Heating Oil | 8.57 | |||||
High Grade Copper | 19.16 | |||||
Natural Gas | 19.02 | |||||
Nickel | 6.75 | |||||
Unleaded Gasoline | 8.73 | |||||
WTI Crude | 16.18 | |||||
Zinc | 7.83 | |||||
Short Futures Contracts | ||||||
Aluminum | (13.76 | )% | ||||
Heating Oil | (8.57 | ) | ||||
High Grade Copper | (19.16 | ) | ||||
Natural Gas | (19.02 | ) | ||||
Nickel | (6.75 | ) | ||||
Unleaded Gasoline | (8.73 | ) | ||||
WTI Crude | (16.18 | ) | ||||
Zinc | (7.83 | ) | ||||
Macquarie MQCP252 Index |
| |||||
Short Futures Contracts | ||||||
Aluminum | (13.76 | )% | ||||
Heating Oil | (8.57 | ) | ||||
High Grade Copper | (19.16 | ) | ||||
Natural Gas | (19.02 | ) | ||||
Nickel | (6.75 | ) | ||||
Unleaded Gasoline | (8.73 | ) | ||||
WTI Crude | (16.18 | ) | ||||
Zinc | (7.83 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
35 Invesco Global Targeted Returns Fund
Morgan Stanley Systematic 5-Month Dispersion Index |
Top 50 Underlying Reference Entity Components | ||||||||
Description | Percentage | |||||||
Currencies | ||||||||
U.S. Dollars | 41.69 | % | ||||||
Long Futures Contracts | Expiration Month | |||||||
SPX Index | June–2018 | 63.44 | % | |||||
Short Equity Securities | ||||||||
Adobe Systems Inc. | (0.17 | )% | ||||||
Amazon.com, Inc. | (5.94 | ) | ||||||
Bank of America Corp. | (1.64 | ) | ||||||
Chevron Corp. | (2.11 | ) | ||||||
Cisco Systems, Inc. | (1.72 | ) | ||||||
Exxon Mobil Corp. | (0.30 | ) | ||||||
Home Depot, Inc. (The) | (0.95 | ) | ||||||
Intel Corp. | (2.12 | ) | ||||||
JPMorgan Chase & Co. | (0.26 | ) | ||||||
Mastercard Inc. | (0.86 | ) | ||||||
McDonald’s Corp. | (0.54 | ) | ||||||
Merck & Co., Inc. | (1.01 | ) | ||||||
Microsoft Corp. | (3.35 | ) | ||||||
Netflix, Inc. | (0.52 | ) | ||||||
NVIDIA Corp. | (0.21 | ) | ||||||
Pfizer Inc. | (0.91 | ) | ||||||
Union Pacific Corp. | (0.18 | ) | ||||||
UnitedHealth Group Inc. | (1.63 | ) | ||||||
Verizon Communications Inc. | (0.39 | ) | ||||||
Visa Inc. | (2.25 | ) | ||||||
Long Equity Securities | ||||||||
3M Co. | 0.63 | % | ||||||
Alphabet Inc.–Class A | 0.74 | |||||||
Alphabet Inc.–Class C | 0.78 | |||||||
Altria Group Inc. | 0.58 | |||||||
Apple Inc. | 0.64 | |||||||
AT&T Inc. | 0.79 | |||||||
Bank of America | 0.29 | |||||||
Berkshire Hathaway Inc. | 0.50 | |||||||
Bristol-Myers Squibb Co. | 0.42 | |||||||
Citigroup Inc. | 0.71 | |||||||
Coca Cola Co. (The) | 0.54 | |||||||
Comcast Corp. | 0.64 | |||||||
Dow Dupont Inc. | 0.54 | |||||||
Gilead Sciences, Inc. | 0.21 | |||||||
Honeywell International Inc. | 0.29 | |||||||
IBM | 0.43 | |||||||
Johnson & Johnson | 0.69 | |||||||
Oracle Corp. | 0.34 | |||||||
PepsiCo., Inc. | 0.65 | |||||||
Philip Morris International Inc. | 0.83 | |||||||
Procter & Gamble Co. | 0.82 | |||||||
Walmart Inc. | 0.19 | |||||||
Wells Fargo & Co. | 0.63 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
36 Invesco Global Targeted Returns Fund
Top 50 Underlying Reference Entity Components—(continued) | ||||||||||||||||
Options Written | ||||||||||||||||
Type of Contract | Expiration Date | Exercise Price | Percentage | |||||||||||||
SPX Index | Call | 09/21/2018 | $ | 2,775 | (0.62 | )% | ||||||||||
SPX Index | Call | 09/21/2018 | 2,725 | (0.42 | ) | |||||||||||
SPX Index | Call | 07/20/2018 | 2,685 | (0.23 | ) | |||||||||||
SPX Index | Call | 09/21/2018 | 2,925 | (0.21 | ) | |||||||||||
SPX Index | Call | 09/21/2018 | 2,700 | (0.20 | ) |
Open Over-The-Counter Total Return Swap Agreements(t) | ||||||||||||||||||||||||||||||||||||||
Counterparty | Pay/ Receive | Reference Entity | Floating Rate Index | Payment Frequency | Number of Contracts | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized (Depreciation) | ||||||||||||||||||||||||||||
UBS | Pay | MSCI World Energy Sector Total Return Index | | 3 Month LIBOR + 0.385 | % | Monthly | 1,893 | 09/25/2018 | $ | 615,873 | $ | — | $ | (51,711 | ) | $ | (51,711 | ) | ||||||||||||||||||||
J.P. Morgan Chase Bank, N.A. | Receive | MSCI World Energy Sector Total Return Index | | 3 Month LIBOR – 0.300 | % | Monthly | 3,818 | 01/23/2019 | 1,242,245 | — | 104,303 | 104,303 | ||||||||||||||||||||||||||
UBS | Receive | MSCI World Energy Sector Total Return Index | | 3 Month LIBOR – 0.385 | % | Monthly | 12,621 | 09/26/2018 | 4,105,042 | — | 344,675 | 344,675 | ||||||||||||||||||||||||||
Total Open Over-The-Counter Total Return Swap Agreements — Equity Risk |
| $ | — | $ | 397,267 | $ | 397,267 |
(t) | The Fund receives or pays payments based on any positive or negative return on the Reference Entity, respectively. |
Open Forward Foreign Currency Contracts | ||||||||||||||||||||||
Settlement
| Counterparty | Contract to | Unrealized Appreciation (Depreciation) | |||||||||||||||||||
Deliver | Receive | |||||||||||||||||||||
05/11/2018 | Barclays Bank PLC | USD | 3,364 | IDR | 47,196,000 | $ | 22 | |||||||||||||||
05/11/2018 | Barclays Bank PLC | USD | 3,067,536 | MXN | 58,642,999 | 63,717 | ||||||||||||||||
05/11/2018 | Citigroup Global Markets Inc. | CLP | 476,470,671 | USD | 796,057 | 19,637 | ||||||||||||||||
05/11/2018 | Citigroup Global Markets Inc. | TWD | 70,122,206 | USD | 2,409,943 | 39,794 | ||||||||||||||||
05/11/2018 | Deutsche Bank Securities Inc. | AUD | 2,721,834 | USD | 2,158,480 | 109,713 | ||||||||||||||||
05/11/2018 | Deutsche Bank Securities Inc. | CAD | 1,814,650 | USD | �� | 1,457,351 | 43,438 | |||||||||||||||
05/11/2018 | Deutsche Bank Securities Inc. | CHF | 2,959,467 | JPY | 348,568,982 | 201,769 | ||||||||||||||||
05/11/2018 | Goldman Sachs International | BRL | 500,000 | USD | 154,178 | 11,629 | ||||||||||||||||
05/11/2018 | Goldman Sachs International | EUR | 702,539 | USD | 877,963 | 28,810 | ||||||||||||||||
05/11/2018 | Goldman Sachs International | NZD | 1,664,333 | USD | 1,215,487 | 44,547 | ||||||||||||||||
05/14/2018 | Goldman Sachs International | EUR | 1,073,000 | USD | 1,328,269 | 31,052 | ||||||||||||||||
05/14/2018 | Goldman Sachs International | GBP | 1,225,000 | USD | 1,708,330 | 20,821 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | AUD | 442,000 | USD | 342,158 | 9,449 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | BRL | 697,000 | USD | 205,696 | 7,244 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | CAD | 410,000 | USD | 325,072 | 5,526 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | CHF | 3,812,913 | USD | 3,943,731 | 87,683 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | CNY | 18,274,976 | USD | 2,911,744 | 27,122 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | DKK | 3,170,671 | USD | 527,617 | 12,630 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | EUR | 11,559,656 | USD | 14,316,934 | 330,257 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | GBP | 14,878,046 | USD | 21,138,720 | 631,630 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | HKD | 35,346,732 | USD | 4,507,305 | 647 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | IDR | 1,318,309,000 | USD | 95,412 | 1,013 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | INR | 29,557,000 | USD | 447,349 | 4,204 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | JPY | 73,596,161 | USD | 685,189 | 10,782 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | KRW | 2,208,863,643 | USD | 2,083,970 | 19,659 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | MXN | 2,416,000 | USD | 132,235 | 3,533 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | NOK | 7,498,071 | USD | 964,739 | 29,176 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
37 Invesco Global Targeted Returns Fund
Open Forward Foreign Currency Contracts—(continued) | ||||||||||||||||||||||
Settlement
| Counterparty | Contract to | Unrealized Appreciation (Depreciation) | |||||||||||||||||||
Deliver | Receive | |||||||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | SEK | 8,973,647 | USD | 1,061,057 | $ | 34,233 | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | SGD | 396,518 | USD | 302,921 | 3,711 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | TWD | 16,970,602 | USD | 579,459 | 5,368 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 13,236 | CAD | 17,000 | 14 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 14,968 | INR | 1,003,000 | 70 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 5,247 | MXN | 99,000 | 26 | ||||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | ZAR | 675,000 | USD | 56,189 | 2,238 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | CAD | 78,866 | USD | 62,149 | 675 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 31,029 | CAD | 40,000 | 150 | ||||||||||||||||
06/07/2018 | Barclays Bank PLC | EUR | 1,314,141 | USD | 1,630,111 | 38,424 | ||||||||||||||||
06/07/2018 | Barclays Bank PLC | NZD | 1,565,000 | USD | 1,133,412 | 32,493 | ||||||||||||||||
06/07/2018 | Barclays Bank PLC | USD | 3,054,562 | MXN | 58,642,999 | 62,999 | ||||||||||||||||
06/07/2018 | Citigroup Global Markets Inc. | EUR | 4,381,193 | USD | 5,445,005 | 138,503 | ||||||||||||||||
06/07/2018 | Deutsche Bank Securities Inc. | AUD | 2,745,667 | USD | 2,128,738 | 61,876 | ||||||||||||||||
06/07/2018 | Deutsche Bank Securities Inc. | CHF | 2,441,367 | JPY | 275,729,209 | 57,183 | ||||||||||||||||
06/07/2018 | Deutsche Bank Securities Inc. | KRW | 233,209,400 | USD | 219,089 | 1,164 | ||||||||||||||||
06/07/2018 | Goldman Sachs International | KRW | 349,814,100 | USD | 329,077 | 2,189 | ||||||||||||||||
06/07/2018 | J.P. Morgan Chase Bank, N.A. | EUR | 2,628,281 | USD | 3,264,110 | 80,735 | ||||||||||||||||
06/07/2018 | J.P. Morgan Chase Bank, N.A. | KRW | 349,814,100 | USD | 329,082 | 2,194 | ||||||||||||||||
06/07/2018 | Standard Chartered Bank PLC | KRW | 233,209,400 | USD | 218,986 | 1,061 | ||||||||||||||||
06/07/2018 | Standard Chartered Bank PLC | TWD | 70,122,206 | USD | 2,415,321 | 40,787 | ||||||||||||||||
06/14/2018 | Goldman Sachs International | GBP | 1,000,000 | USD | 1,396,130 | 16,405 | ||||||||||||||||
07/12/2018 | Barclays Bank PLC | CNY | 15,000,000 | USD | 2,372,026 | 9,797 | ||||||||||||||||
07/12/2018 | Barclays Bank PLC | INR | 38,731,000 | USD | 588,036 | 10,451 | ||||||||||||||||
07/12/2018 | Barclays Bank PLC | MXN | 2,807,000 | USD | 152,779 | 4,358 | ||||||||||||||||
07/12/2018 | Barclays Bank PLC | NZD | 1,614,667 | USD | 1,175,766 | 39,875 | ||||||||||||||||
07/12/2018 | Deutsche Bank Securities Inc. | AUD | 3,605,667 | USD | 2,771,366 | 56,539 | ||||||||||||||||
07/12/2018 | Deutsche Bank Securities Inc. | BRL | 168,000 | USD | 50,284 | 2,669 | ||||||||||||||||
07/12/2018 | Deutsche Bank Securities Inc. | CAD | 851,700 | USD | 668,262 | 3,648 | ||||||||||||||||
07/12/2018 | Deutsche Bank Securities Inc. | MXN | 4,117,000 | USD | 223,738 | 6,052 | ||||||||||||||||
07/12/2018 | Goldman Sachs International | CHF | 2,959,467 | JPY | 330,415,316 | 32,266 | ||||||||||||||||
07/12/2018 | Goldman Sachs International | EUR | 1,375,703 | USD | 1,699,557 | 28,568 | ||||||||||||||||
07/12/2018 | Goldman Sachs International | TWD | 70,122,206 | USD | 2,422,434 | 40,764 | ||||||||||||||||
07/16/2018 | Goldman Sachs International | EUR | 904,000 | USD | 1,127,409 | 29,021 | ||||||||||||||||
07/16/2018 | Goldman Sachs International | GBP | 2,690,000 | USD | 3,869,022 | 151,600 | ||||||||||||||||
10/12/2018 | Citigroup Global Markets Inc. | CLP | 788,171,396 | USD | 1,300,807 | 16,954 | ||||||||||||||||
10/12/2018 | Deutsche Bank Securities Inc. | CLP | 216,700,000 | USD | 362,921 | 9,938 | ||||||||||||||||
11/09/2018 | Deutsche Bank Securities Inc. | AUD | 2,721,834 | USD | 2,160,517 | 108,803 | ||||||||||||||||
Subtotal — Appreciation |
| 2,929,305 | ||||||||||||||||||||
05/11/2018 | Barclays Bank PLC | MXN | 18,705,000 | USD | 991,581 | (7,176 | ) | |||||||||||||||
05/11/2018 | Barclays Bank PLC | RUB | 57,441,001 | USD | 892,224 | (18,704 | ) | |||||||||||||||
05/11/2018 | Barclays Bank PLC | USD | 2,763,922 | CLP | 1,666,700,000 | (47,995 | ) | |||||||||||||||
05/11/2018 | Barclays Bank PLC | USD | 4,635,022 | INR | 300,678,507 | (125,584 | ) | |||||||||||||||
05/11/2018 | Barclays Bank PLC | USD | 104,328 | NZD | 142,000 | (4,424 | ) | |||||||||||||||
05/11/2018 | Barclays Bank PLC | USD | 1,003,512 | RUB | 57,441,001 | (92,584 | ) | |||||||||||||||
05/11/2018 | Barclays Bank PLC | USD | 8,083 | TWD | 239,000 | (4 | ) | |||||||||||||||
05/11/2018 | Citigroup Global Markets Inc. | USD | 383,566 | AUD | 507,392 | (1,645 | ) | |||||||||||||||
05/11/2018 | Deutsche Bank Securities Inc. | CNY | 25,651,331 | USD | 4,047,739 | (2,034 | ) | |||||||||||||||
05/11/2018 | Goldman Sachs International | EUR | 4,201,591 | SEK | 41,317,000 | (355,774 | ) | |||||||||||||||
05/11/2018 | Morgan Stanley & Co. LLC | USD | 246,931 | EUR | 199,911 | (5,300 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
38 Invesco Global Targeted Returns Fund
Open Forward Foreign Currency Contracts—(continued) | ||||||||||||||||||||||
Settlement
| Counterparty | Contract to | Unrealized Appreciation (Depreciation) | |||||||||||||||||||
Deliver | Receive | |||||||||||||||||||||
05/11/2018 | State Street Bank & Trust Co. | USD | 47,494 | GBP | 34,000 | $ | (664 | ) | ||||||||||||||
05/11/2018 | State Street Bank & Trust Co. | USD | 8,650 | NOK | 68,000 | (169 | ) | |||||||||||||||
05/11/2018 | State Street Bank & Trust Co. | USD | 16,759 | SEK | 142,000 | (528 | ) | |||||||||||||||
05/15/2018 | J.P. Morgan Chase Bank, N.A. | USD | 80,388 | MXN | 1,500,000 | (348 | ) | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 91,925 | AUD | 120,354 | (1,331 | ) | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 301,101 | CHF | 296,000 | (1,687 | ) | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 140,259 | EUR | 115,000 | (850 | ) | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 268,658 | GBP | 194,000 | (1,265 | ) | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 119,243 | HKD | 935,000 | (32 | ) | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 4,161 | IDR | 58,095,000 | (1 | ) | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 94,325 | JPY | 10,171,000 | (1,122 | ) | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 318,628 | KRW | 337,925,761 | (2,817 | ) | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 18,511 | NOK | 147,000 | (102 | ) | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 60,620 | SEK | 515,000 | (1,691 | ) | |||||||||||||||
05/25/2018 | State Street Bank & Trust Co. | USD | 47,864 | TWD | 1,408,000 | (234 | ) | |||||||||||||||
06/07/2018 | Barclays Bank PLC | KRW | 7,895,166,862 | USD | 7,335,239 | (42,493 | ) | |||||||||||||||
06/07/2018 | Barclays Bank PLC | USD | 7,408,184 | JPY | 778,278,612 | (269,667 | ) | |||||||||||||||
06/07/2018 | Citigroup Global Markets Inc. | USD | 388,812 | AUD | 514,312 | (1,653 | ) | |||||||||||||||
06/07/2018 | Citigroup Global Markets Inc. | USD | 412,984 | JPY | 43,650,900 | (12,610 | ) | |||||||||||||||
06/07/2018 | Citigroup Global Markets Inc. | USD | 55,623 | NZD | 78,744 | (230 | ) | |||||||||||||||
06/07/2018 | Deutsche Bank Securities Inc. | CAD | 2,796,850 | USD | 2,177,783 | (2,745 | ) | |||||||||||||||
06/07/2018 | Deutsche Bank Securities Inc. | CNY | 33,911,862 | USD | 5,312,924 | (37,378 | ) | |||||||||||||||
06/07/2018 | Deutsche Bank Securities Inc. | USD | 276,141 | JPY | 29,100,600 | (9,225 | ) | |||||||||||||||
06/07/2018 | Goldman Sachs International | EUR | 4,067,683 | SEK | 41,317,000 | (191,631 | ) | |||||||||||||||
06/07/2018 | Goldman Sachs International | USD | 2,723,984 | BRL | 8,960,000 | (176,442 | ) | |||||||||||||||
06/07/2018 | Goldman Sachs International | USD | 571,934 | CLP | 343,000,000 | (13,033 | ) | |||||||||||||||
06/07/2018 | Goldman Sachs International | USD | 2,462,766 | INR | 162,431,707 | (30,103 | ) | |||||||||||||||
06/07/2018 | Goldman Sachs International | USD | 137,934 | JPY | 14,550,300 | (4,475 | ) | |||||||||||||||
06/07/2018 | Goldman Sachs International | USD | 1,319,354 | RUB | 75,575,887 | (124,773 | ) | |||||||||||||||
06/07/2018 | J.P. Morgan Chase Bank, N.A. | RUB | 75,575,887 | USD | 1,159,826 | (34,755 | ) | |||||||||||||||
06/07/2018 | Morgan Stanley & Co. LLC | USD | 138,393 | JPY | 14,550,300 | (4,934 | ) | |||||||||||||||
06/07/2018 | Standard Chartered Bank PLC | USD | 276,560 | JPY | 29,100,600 | (9,644 | ) | |||||||||||||||
06/15/2018 | Goldman Sachs International | USD | 408,706 | EUR | 331,750 | (6,627 | ) | |||||||||||||||
06/15/2018 | Goldman Sachs International | USD | 161,854 | GBP | 115,000 | (3,177 | ) | |||||||||||||||
06/15/2018 | Goldman Sachs International | USD | 146,362 | JPY | 15,600,000 | (3,193 | ) | |||||||||||||||
06/15/2018 | Goldman Sachs International | USD | 21,196 | ZAR | 255,000 | (870 | ) | |||||||||||||||
06/22/2018 | Goldman Sachs International | EUR | 58,700 | GBP | 51,501 | (98 | ) | |||||||||||||||
07/12/2018 | Barclays Bank PLC | USD | 4,441,144 | INR | 29,174,7607 | (90,386 | ) | |||||||||||||||
07/12/2018 | Citigroup Global Markets Inc. | USD | 478,287 | AUD | 632,498 | (2,058 | ) | |||||||||||||||
07/12/2018 | Citigroup Global Markets Inc. | USD | 210,029 | CAD | 264,300 | (3,785 | ) | |||||||||||||||
07/12/2018 | Deutsche Bank Securities Inc. | JPY | 40,704,230 | CHF | 364,900 | (3,650 | ) | |||||||||||||||
07/12/2018 | Deutsche Bank Securities Inc. | USD | 351,012 | AUD | 453,000 | (9,933 | ) | |||||||||||||||
07/12/2018 | Deutsche Bank Securities Inc. | USD | 164,219 | NZD | 223,000 | (7,343 | ) | |||||||||||||||
07/12/2018 | Goldman Sachs International | EUR | 3,306,497 | SEK | 34,047,000 | (105,062 | ) | |||||||||||||||
07/12/2018 | Goldman Sachs International | RUB | 73,867,499 | USD | 1,127,197 | (35,767 | ) | |||||||||||||||
07/12/2018 | Goldman Sachs International | USD | 70,677 | MXN | 1,296,000 | (2,151 | ) | |||||||||||||||
07/12/2018 | Goldman Sachs International | USD | 1,268,950 | RUB | 73,867,499 | (105,985 | ) | |||||||||||||||
07/12/2018 | J.P. Morgan Chase Bank, N.A. | USD | 875,195 | CNY | 5,518,200 | (6,178 | ) | |||||||||||||||
07/12/2018 | State Street Bank & Trust Co. | USD | 472,723 | EUR | 381,511 | (9,323 | ) | |||||||||||||||
07/16/2018 | Deutsche Bank Securities Inc. | EUR | 268,729 | GBP | 233,000 | (4,522 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
39 Invesco Global Targeted Returns Fund
Open Forward Foreign Currency Contracts—(continued) | ||||||||||||||||||||||
Settlement
| Counterparty | Contract to | Unrealized Appreciation (Depreciation) | |||||||||||||||||||
Deliver | Receive | |||||||||||||||||||||
10/12/2018 | Barclays Bank PLC | USD | 144,845 | CLP | 86,900,000 | $ | (3,294 | ) | ||||||||||||||
10/12/2018 | Deutsche Bank Securities Inc. | USD | 6,293,357 | CLP | 3,815,000,000 | (79,099 | ) | |||||||||||||||
11/09/2018 | Citigroup Global Markets Inc. | USD | 384,111 | AUD | 507,392 | (1,640 | ) | |||||||||||||||
Subtotal — Depreciation |
| (2,123,997 | ) | |||||||||||||||||||
Total Forward Foreign Currency Contracts — Currency Risk |
| $ | 805,308 |
Investment Abbreviations:
AUD | – Australian Dollar | |
BBSW | – Australian Bank Bill Swap Rate | |
BRL | – Brazilian Real | |
CAD | – Canadian Dollar | |
CDOR | – Canadian Dealer Offered Rate | |
CHF | – Swiss Franc | |
CLP | – Chilean Peso | |
CNY | – Chinese Yuan | |
CPI | – Consumer Price Index | |
DKK | – Danish Krone | |
EUR | – Euro |
GBP | – British Pound Sterling | |
HICP | – Harmonised Index of Consumer Prices | |
HKD | – Hong Kong Dollar | |
IDR | – Indonesian Rupiah | |
INR | – Indian Rupee | |
JPY | – Japanese Yen | |
KRW | – South Korean Won | |
LIBOR | – London Interbank Offered Rate | |
MXN | – Mexican New Peso | |
NOK | – Norwegian Krone | |
NSA | – Non-Seasonally Adjusted |
NZD | – New Zealand Dollar | |
RPI | – Retail Price Index | |
RUB | – Russian Ruble | |
SEK | – Swedish Krona | |
SGD | – Singapore Dollar | |
STIBOR | – Stockholm Interbank Offered Rate | |
TIIE | – Interbank Equilibrium Interest Rate | |
TWD | – New Taiwan Dollar | |
USD | – U.S. Dollar | |
ZAR | – South African Rand |
Portfolio Composition
By Asset Type
Risk Allocation(1) | Notional Value as % of Total Net Assets(2) | Value as % of Total Net Assets(3) | ||||||||||
Commodity | 6.41 | % | 26.41 | % | 0.04 | % | ||||||
Credit | 6.66 | % | 43.41 | % | 15.80 | % | ||||||
Currency | 30.37 | % | 209.55 | % | 1.07 | % | ||||||
Equity | 28.88 | % | 383.86 | % | 42.11 | % | ||||||
Inflation | 6.99 | % | 132.79 | % | 0.07 | % | ||||||
Interest Rate | 17.76 | % | 405.51 | % | 11.80 | % | ||||||
Volatility(4) | 2.93 | % | 0.40 | % | (0.29 | )% | ||||||
Money Market Funds Plus Other Assets less Liabilities | — | — | 29.40 | % |
(1) | The values in this column represent the Adviser’s proprietary measure of risk that each asset type contributes to the Fund. The risk associated with each asset type is calculated by aggregating the independent risk, as of the end of the fiscal period, of each of the Fund’s investment ideas that are included in that asset type. Independent risk is determined by measuring the historical price volatility of the assets or asset classes that comprise the investment idea using a statistical measurement called standard deviation. Standard deviation measures how much historical prices vary from their average over a certain period of time. The risk of each investment idea takes into account the Adviser’s evaluation of the risk dynamics and expected correlation of the components of the investment idea based on historical price movements. Historical price movements may not be representative of future price movements and, therefore, the actual risk of each asset type may be much greater or lower than the values shown. In addition, there are ways to measure risk other than standard deviation which, if used, may have resulted in a different risk allocation. |
(2) | The values in this column represent the gross notional amount of the derivative instruments and other investments held by the Fund, including purchased and written options, futures, forwards, swaps and investment companies. The notional amount of a derivative is the nominal or face amount used to calculate payments made on the instrument. The gross notional amount does not reflect any offsetting or netting of long and short positions. The notional amounts of derivatives and other investments denominated in foreign currencies have been adjusted to the U.S. dollar equivalent using spot exchange rates. See the Consolidated Schedule of Investments for a complete list of derivative instruments held by the Fund as of April 30, 2018. |
(3) | The percentages in this column were calculated by adding the market value of purchased options, the net unrealized appreciation/depreciation of written options, futures, swaps and forwards, and the net asset value of affiliated money market funds held by the Fund. See the Consolidated Schedule of Investments for the complete list of derivative instruments held by the Fund as of April 30, 2018. |
(4) | Includes the volatility and variance swaps held by the Fund, the gains and losses on which are driven by the volatility (i.e., the positive and negative changes in value over time) of a particular asset, such as stocks or currencies, and not by the asset itself. |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
40 Invesco Global Targeted Returns Fund
Consolidated Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: | ||||
Investments in securities, at value (Cost $92,589,073) | $ | 97,294,154 | ||
Investments in affiliates, at value (Cost $28,335,653) | 28,335,936 | |||
Other investments: | ||||
Variation margin receivable — futures contracts | 36,352 | |||
Variation margin receivable — centrally cleared swap agreements | 118,073 | |||
Swaps receivable — OTC | 160,056 | |||
Unrealized appreciation on forward foreign currency contracts outstanding | 2,929,305 | |||
Unrealized appreciation on swap agreements — OTC | 1,575,822 | |||
Deposits with brokers: | ||||
Cash collateral — exchange-traded futures contracts | 4,195,646 | |||
Cash collateral — exchange-traded swap agreements | 2,856,690 | |||
Cash collateral OTC Derivatives | 2,031,897 | |||
Foreign currencies, at value (Cost $5,600,635) | 5,546,102 | |||
Receivable for: | ||||
Investments sold | 870,820 | |||
Fund shares sold | 3,081,976 | |||
Dividends and interest | 909,333 | |||
Fund expenses absorbed | 112,395 | |||
Investment for trustee deferred compensation and retirement plans | 11,247 | |||
Other assets | 600,754 | |||
Total assets | 150,666,558 | |||
Liabilities: |
| |||
Other investments: | ||||
Options written, at value (premiums received $5,905,735) | 4,531,395 | |||
Swaps payable — OTC | 41,926 | |||
Unrealized depreciation on forward foreign currency contracts outstanding | 2,123,997 | |||
Unrealized depreciation on swap agreements — OTC | 1,673,790 | |||
Payable for: | ||||
Investments purchased | 1,360,330 | |||
Fund shares reacquired | 350,604 | |||
Accrued foreign taxes | 5,242 | |||
Amount due custodian | 2,359,395 | |||
Accrued fees to affiliates | 38,930 | |||
Accrued trustees’ and officers’ fees and benefits | 1,596 | |||
Accrued other operating expenses | 361,093 | |||
Trustee deferred compensation and retirement plans | 11,247 | |||
Total liabilities | 12,859,545 | |||
Net assets applicable to shares outstanding | $ | 137,807,013 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 144,587,010 | ||
Undistributed net investment income | 848,979 | |||
Undistributed net realized gain (loss) | (12,271,036 | ) | ||
Net unrealized appreciation | 4,642,060 | |||
$ | 137,807,013 |
Net Assets: |
| |||
Class A | $ | 16,324,724 | ||
Class C | $ | 9,456,431 | ||
Class R | $ | 25,881 | ||
Class Y | $ | 100,532,382 | ||
Class R5 | $ | 9,956 | ||
Class R6 | $ | 11,457,639 | ||
Shares outstanding, no par value, |
| |||
Class A | 1,649,630 | |||
Class C | 978,220 | |||
Class R | 2,634 | |||
Class Y | 10,102,262 | |||
Class R5 | 1,000 | |||
Class R6 | 1,151,670 | |||
Class A: | ||||
Net asset value per share | $ | 9.90 | ||
Maximum offering price per share | ||||
(Net asset value of $9.90 ¸ 94.50%) | $ | 10.48 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 9.67 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 9.83 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 9.95 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 9.96 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 9.95 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
41 Invesco Global Targeted Returns Fund
Consolidated Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of foreign withholding taxes of $63,546) | $ | 811,799 | ||
Dividends from affiliated underlying funds | 223,875 | |||
Interest (net of foreign withholding taxes of $1,232) | 673,789 | |||
Total investment income | 1,709,463 | |||
Expenses: | ||||
Advisory fees | 785,183 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 159,693 | |||
Distribution fees: | ||||
Class A | 21,972 | |||
Class C | 52,586 | |||
Class R | 64 | |||
Transfer agent fees — A, C, R and Y | 60,024 | |||
Transfer agent fees — R6 | 133 | |||
Trustees’ and officers’ fees and benefits | 11,498 | |||
Registration and filing fees | 42,670 | |||
Licensing Fees | 68,574 | |||
Reports to shareholders | 18,282 | |||
Professional services fees | 67,019 | |||
Other | 295,829 | |||
Total expenses | 1,608,322 | |||
Less: Fees waived, expenses reimbursed and expense offset arrangement(s) | (716,176 | ) | ||
Net expenses | 892,146 | |||
Net investment income | 817,317 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | (4,684,154 | ) | ||
Foreign currencies | 300,424 | |||
Forward foreign currency contracts | (4,926,172 | ) | ||
Futures contracts | (1,609,230 | ) | ||
Option contracts written | 3,610,177 | |||
Swap agreements | (1,523,845 | ) | ||
(8,832,800 | ) | |||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | 4,657,993 | |||
Foreign currencies | (50,518 | ) | ||
Forward foreign currency contracts | 1,558,078 | |||
Futures contracts | 1,185,491 | |||
Option contracts written | (199,275 | ) | ||
Swap agreements | (571,436 | ) | ||
6,580,333 | ||||
Net realized and unrealized gain (loss) | (2,252,467 | ) | ||
Net increase (decrease) in net assets resulting from operations | $ | (1,435,150 | ) |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
42 Invesco Global Targeted Returns Fund
Consolidated Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income | $ | 817,317 | $ | 2,485,856 | ||||
Net realized gain (loss) | (8,832,800 | ) | (4,483,613 | ) | ||||
Change in net unrealized appreciation | 6,580,333 | 4,018,356 | ||||||
Net increase (decrease) in net assets resulting from operations | (1,435,150 | ) | 2,020,599 | |||||
Distributions to shareholders from net investment income: | ||||||||
Class A | — | (302,695 | ) | |||||
Class C | — | (93,125 | ) | |||||
Class R | — | (177 | ) | |||||
Class Y | — | (2,306,952 | ) | |||||
Class R5 | — | (921 | ) | |||||
Class R6 | — | (151 | ) | |||||
Total distributions from net investment income | — | (2,704,021 | ) | |||||
Return of capital: | ||||||||
Class A | — | (11,454 | ) | |||||
Class C | — | (3,524 | ) | |||||
Class R | — | (7 | ) | |||||
Class Y | — | (87,296 | ) | |||||
Class R5 | — | (35 | ) | |||||
Class R6 | — | (6 | ) | |||||
Total return of capital | — | (102,322 | ) | |||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | — | (757,865 | ) | |||||
Class C | — | (493,617 | ) | |||||
Class R | — | (538 | ) | |||||
Class Y | — | (4,799,192 | ) | |||||
Class R5 | — | (1,917 | ) | |||||
Class R6 | — | (314 | ) | |||||
Total distributions from net realized gains | — | (6,053,443 | ) | |||||
Share transactions–net: | ||||||||
Class A | (2,845,630 | ) | (9,083,175 | ) | ||||
Class C | (2,660,483 | ) | (3,618,751 | ) | ||||
Class R | 150 | 10,007 | ||||||
Class Y | (6,512,119 | ) | (61,768,547 | ) | ||||
Class R5 | — | (51,152 | ) | |||||
Class R6 | 2,907,390 | 8,592,340 | ||||||
Net increase (decrease) in net assets resulting from share transactions | (9,110,692 | ) | (65,919,278 | ) | ||||
Net increase (decrease) in net assets | (10,545,842 | ) | (72,758,465 | ) | ||||
Net assets: | ||||||||
Beginning of period | 148,352,855 | 221,111,320 | ||||||
End of period (includes undistributed net investment income of $848,979 and $31,662, respectively) | $ | 137,807,013 | $ | 148,352,855 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
43 Invesco Global Targeted Returns Fund
Notes to Consolidated Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Global Targeted Returns Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these consolidated financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund will seek to gain exposure to the commodity markets primarily through investments in the Invesco Cayman Commodity Fund VII Ltd. (the “Subsidiary”), a wholly-owned subsidiary of the Fund organized under the laws of the Cayman Islands. The Subsidiary was organized by the Fund to invest in commodity-linked derivatives and other securities that may provide leveraged and non-leveraged exposure to commodities. The Fund may invest up to 25% of its total assets in the Subsidiary.
The Fund’s investment objective is to seek a positive total return over the long term in all market environments.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its consolidated financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
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Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the consolidated financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Consolidated Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Consolidated Statement of Operations and the Consolidated Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Consolidated Statement of Operations and the Consolidated Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Consolidated Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the consolidated financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Subsidiary is classified as a controlled foreign corporation under Subchapter N of the Internal Revenue Code. Therefore, the Fund is required to increase its taxable income by its share of the Subsidiary’s income. Net investment losses of the Subsidiary cannot be deducted by the Fund in the current period nor carried forward to offset taxable income in future periods.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The financial statements are prepared on a consolidated basis in conformity with accounting principles generally accepted in the United States of America (“GAAP”), which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. The accompanying financial statements reflect the financial position of the Fund and its Subsidiary and the results of operations on a consolidated basis. All inter-company accounts and transactions have been eliminated in consolidation. |
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In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the consolidated financial statements are released to print.
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust, and under the Subsidiary’s organizational documents, the directors and officers of the Subsidiary, are indemnified against certain liabilities that may arise out of the performance of their duties to the Fund and/or the Subsidiary, respectively. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Treasury Inflation-Protected Securities — The Fund may invest in Treasury Inflation-Protected Securities (“TIPS”). TIPS are fixed income securities whose principal value is periodically adjusted to the rate of inflation. The principal value of TIPS will be adjusted upward or downward, and any increase or decrease in the principal amount of TIPS will be included as interest income in the Statement of Operations, even though investors do not receive their principal until maturity. |
J. | Structured Securities — The Fund may invest in structured securities. Structured securities are a type of derivative security whose value is determined by reference to changes in the value of underlying securities, currencies, interest rates, commodities, indices or other financial indicators (“reference instruments”). Most structured securities are fixed-income securities that have maturities of three years or less. Structured securities may be positively or negatively indexed (i.e., their principal value or interest rates may increase or decrease if the underlying reference instrument appreciates) and may have return characteristics similar to direct investments in the underlying reference instrument. |
Structured securities may entail a greater degree of market risk than other types of debt securities because the investor bears the risk of the reference instruments. In addition to the credit risk of structured securities and the normal risks of price changes in response to changes in interest rates, the principal amount of structured notes or indexed securities may decrease as a result of changes in the value of the underlying reference instruments. Changes in the daily value of structured securities are recorded as unrealized gains (losses) in the Consolidated Statement of Operations. When the structured securities mature or are sold, the Fund recognizes a realized gain (loss) on the Consolidated Statement of Operations.
K. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Consolidated Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Consolidated Statement of Operations.
L. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Consolidated Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Consolidated Statement of Assets and Liabilities.
M. | Futures Contracts — The Fund may enter into futures contracts to equitize the Fund’s cash holdings or to manage exposure to interest rate, equity, commodity and market price movements and/or currency risks. A futures contract is an agreement between Counterparties to purchase or sell a specified underlying security, currency or commodity (or delivery of a cash settlement price, in the case of an index future) for a fixed price at a future date. The Fund currently invests only in exchange-traded futures and they are standardized as to maturity date and underlying financial instrument. Initial margin deposits required upon entering into futures contracts are satisfied by the segregation of specific securities or cash as collateral at the futures commission merchant (broker). During the period the futures contracts are open, changes in the value of the contracts are recognized as unrealized gains or losses by recalculating the value of the contracts on a daily basis. Subsequent or variation margin payments are received or made depending upon whether unrealized gains or losses are incurred. These amounts are reflected as receivables or payables on the Consolidated Statement of Assets and Liabilities. When the contracts are closed or expire, the Fund recognizes a realized gain or loss equal to the difference between the proceeds from, or cost of, the closing transaction and the Fund’s basis in the contract. The net realized gain (loss) and the change in unrealized gain (loss) on futures contracts held during the period is included on the Consolidated Statement of |
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Operations. The primary risks associated with futures contracts are market risk and the absence of a liquid secondary market. If the Fund were unable to liquidate a futures contract and/or enter into an offsetting closing transaction, the Fund would continue to be subject to market risk with respect to the value of the contracts and continue to be required to maintain the margin deposits on the futures contracts. Futures contracts have minimal Counterparty risk since the exchange’s clearinghouse, as Counterparty to all exchange-traded futures, guarantees the futures against default. Risks may exceed amounts recognized in the Consolidated Statement of Assets and Liabilities. |
N. | Call Options Purchased and Written — The Fund may write covered call options and/or buy call options. A covered call option gives the purchaser of such option the right to buy, and the writer the obligation to sell, the underlying security or foreign currency at the stated exercise price during the option period. Options written by the Fund normally will have expiration dates between three and nine months from the date written. The exercise price of a call option may be below, equal to, or above the current market value of the underlying security at the time the option is written. |
When the Fund writes a covered call option, an amount equal to the premium received by the Fund is recorded as an asset and an equivalent liability in the Consolidated Statement of Assets and Liabilities. The amount of the liability is subsequently “marked-to-market” to reflect the current market value of the option written. If a written covered call option expires on the stipulated expiration date, or if the Fund enters into a closing purchase transaction, the Fund realizes a gain (or a loss if the closing purchase transaction exceeds the premium received when the option was written) without regard to any unrealized gain or loss on the underlying security, and the liability related to such option is extinguished. If a written covered call option is exercised, the Fund realizes a gain or a loss from the sale of the underlying security and the proceeds of the sale are increased by the premium originally received. Realized and unrealized gains and losses on call options written are included in the Consolidated Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Option contracts written. A risk in writing a covered call option is that the Fund gives up the opportunity for profit if the market price of the security increases and the option is exercised.
When the Fund buys a call option, an amount equal to the premium paid by the Fund is recorded as an investment on the Consolidated Statement of Assets and Liabilities. The amount of the investment is subsequently “marked-to-market” to reflect the current value of the option purchased. Realized and unrealized gains and losses on call options purchased are included in the Consolidated Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Investment securities. A risk in buying an option is that the Fund pays a premium whether or not the option is exercised. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased.
O. | Put Options Purchased and Written — The Fund may purchase and write put options including options on securities indexes, or foreign currency and/or futures contracts. By purchasing a put option, the Fund obtains the right (but not the obligation) to sell the option’s underlying instrument at a fixed strike price. In return for this right, the Fund pays an option premium. The option’s underlying instrument may be a security, securities index, or a futures contract. Put options may be used by the Fund to hedge securities it owns by locking in a minimum price at which the Fund can sell. If security prices fall, the put option could be exercised to offset all or a portion of the Fund’s resulting losses. At the same time, because the maximum the Fund has at risk is the cost of the option, purchasing put options does not eliminate the potential for the Fund to profit from an increase in the value of the underlying portfolio securities. The Fund may write put options to earn additional income in the form of option premiums if it expects the price of the underlying instrument to remain stable or rise during the option period so that the option will not be exercised. The risk in this strategy is that the price of the underlying securities may decline by an amount greater than the premium received. Put options written are reported as a liability in the Consolidated Statement of Assets and Liabilities. Realized and unrealized gains and losses on put options purchased and put options written are included in the Consolidated Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Investment securities and Option contracts written, respectively. A risk in buying an option is that the Fund pays a premium whether or not the option is exercised. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased. |
P. | Swap Agreements — The Fund may enter into various swap transactions, including interest rate, total return, volatility, variance, index, currency and credit default swap contracts (“CDS”) for investment purposes or to manage interest rate, equity, currency, commodity or credit risk. Such transactions are agreements between two parties (“Counterparties”). A swap agreement may be negotiated bilaterally and traded over-the-counter (“OTC”) between two parties (“uncleared/OTC”) or, in some instances, must be transacted through a future commission merchant (“FCM”) and cleared through a clearinghouse that serves as a central Counterparty (“centrally cleared swap”). These agreements may contain among other conditions, events of default and termination events, and various covenants and representations such as provisions that require the Fund to maintain a pre-determined level of net assets, and/or provide limits regarding the decline of the Fund’s NAV over specific periods of time. If the Fund were to trigger such provisions and have open derivative positions at that time, the Counterparty may be able to terminate such agreement and request immediate payment in an amount equal to the net liability positions, if any. |
Interest rate, total return, volatility, variance, index and currency swap agreements are two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a notional amount, i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate or return of an underlying asset, in a particular foreign currency, or in a “basket” of securities representing a particular index.
Inflation swap agreements are contracts in which one party agrees to pay the cumulative percentage increase in a price index, such as the Consumer Price Index, over the term of the swap, and the other party pays a compounded fixed rate.
In a centrally cleared swap, the Fund’s ultimate Counterparty is a central clearinghouse. The Fund will initially enter into centrally cleared swaps through an executing broker. When a fund enters into a centrally cleared swap, it must deliver to the central Counterparty (via the FCM) an amount referred to as “initial margin.” Initial margin requirements are determined by the central Counterparty, but an FCM may require additional initial margin above the amount required by the central Counterparty. Initial margin deposits required upon entering into centrally cleared swaps are satisfied by cash or securities as collateral at the FCM. Securities deposited as initial margin are designated on the Consolidated Schedule of Investments and cash deposited is recorded on the Consolidated Statement of Assets and Liabilities. During the term of a cleared swap agreement, a “variation margin” amount may be required to be paid by the Fund or may be received by the Fund, based on the daily change in price of the underlying reference instrument subject to the swap agreement and is recorded as a receivable or payable for variation margin in the Consolidated Statement of Assets and Liabilities until the centrally cleared swap is terminated, at which time a realized gain or loss is recorded.
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A CDS is an agreement between Counterparties to exchange the credit risk of an issuer. A buyer of a CDS is said to buy protection by paying a fixed payment over the life of the agreement and in some situations an upfront payment to the seller of the CDS. If a defined credit event occurs (such as payment default or bankruptcy), the Fund as a protection buyer would cease paying its fixed payment, the Fund would deliver eligible bonds issued by the reference entity to the seller, and the seller would pay the full notional value, or the “par value”, of the referenced obligation to the Fund. A seller of a CDS is said to sell protection and thus would receive a fixed payment over the life of the agreement and an upfront payment, if applicable. If a credit event occurs, the Fund as a protection seller would cease to receive the fixed payment stream, the Fund would pay the buyer “par value” or the full notional value of the referenced obligation, and the Fund would receive the eligible bonds issued by the reference entity. In turn, these bonds may be sold in order to realize a recovery value. Alternatively, the seller of the CDS and its Counterparty may agree to net the notional amount and the market value of the bonds and make a cash payment equal to the difference to the buyer of protection. If no credit event occurs, the Fund receives the fixed payment over the life of the agreement. As the seller, the Fund would effectively add leverage to its portfolio because, in addition to its total net assets, the Fund would be subject to investment exposure on the notional amount of the CDS. In connection with these agreements, cash and securities may be identified as collateral in accordance with the terms of the respective swap agreements to provide assets of value and recourse in the event of default under the swap agreement or bankruptcy/insolvency of a party to the swap agreement. If a Counterparty becomes bankrupt or otherwise fails to perform its obligations due to financial difficulties, the Fund may experience significant delays in obtaining any recovery in a bankruptcy or other reorganization proceeding. The Fund may obtain only limited recovery or may obtain no recovery in such circumstances. The Fund’s maximum risk of loss from Counterparty risk, either as the protection seller or as the protection buyer, is the value of the contract. The risk may be mitigated by having a master netting arrangement between the Fund and the Counterparty and by the designation of collateral by the Counterparty to cover the Fund’s exposure to the Counterparty.
Implied credit spreads represent the current level at which protection could be bought or sold given the terms of the existing CDS contract and serve as an indicator of the current status of the payment/performance risk of the CDS. An implied spread that has widened or increased since entry into the initial contract may indicate a deteriorating credit profile and increased risk of default for the reference entity. A declining or narrowing spread may indicate an improving credit profile or decreased risk of default for the reference entity. Alternatively, credit spreads may increase or decrease reflecting the general tolerance for risk in the credit markets.
A volatility swap involves an exchange between the Fund and a Counterparty of periodic payments based on the measured volatility of an underlying security, currency, commodity, interest rate, index or other reference asset over a specified time frame. Depending on the structure of the swap, either the Fund’s or the Counterparty’s payment obligation will typically be based on the realized volatility of the reference asset as measured by changes in its price or level over a specified time period, while the other party’s payment obligation will be based on a specified rate representing expected volatility for the reference asset at the time the swap is executed, or the measured volatility of a different reference asset over a specified time period. The Fund will typically make or lose money on a volatility swap depending on the magnitude of the reference asset’s volatility, or size of the movements in its price, over a specified time period, rather than general increases or decreases in the price of the reference asset. Volatility swaps are often used to speculate on future volatility levels, to trade the spread between realized and expected volatility, or to decrease the volatility exposure of other investments held by the Fund. Variance swaps are similar to volatility swaps, except payments are based on the difference between the implied and measured volatility mathematically squared.
An interest rate swap is an agreement between Counterparties pursuant to which the parties exchange a floating rate payment for a fixed rate payment based on a specified notional amount.
Changes in the value of centrally cleared and OTC swap agreements are recognized as unrealized gains (losses) in the Consolidated Statement of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Consolidated Statement of Assets and Liabilities and may be referred to as upfront payments. The Fund accrues for the fixed payment stream and amortizes upfront payments, if any, on swap agreements on a daily basis with the net amount, recorded as a component of realized gain (loss) on the Consolidated Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Consolidated Statement of Operations. The Fund segregates cash or liquid securities having a value at least equal to the amount of the potential obligation of the Fund under any swap transaction. Cash held as collateral is recorded as deposits with brokers on the Consolidated Statement of Assets and Liabilities. Entering into these agreements involves, to varying degrees, lack of liquidity and elements of credit, market, and Counterparty risk in excess of amounts recognized on the Consolidated Statement of Assets and Liabilities. Such risks involve the possibility that a swap is difficult to sell or liquidate, the Counterparty does not honor its obligations under the agreement and unfavorable interest rates and market fluctuations. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund’s exposure is unlimited.
Notional amounts of each individual credit default swap agreement outstanding as of April 30, 2018 for which the Fund is the seller of protection are disclosed in the open swap agreements table. These potential amounts would be partially offset by any recovery values of the respective referenced obligations, upfront payments received upon entering into the agreement, or net amounts received from the settlement of buy protection credit default swap agreements entered into by the Fund for the same referenced entity or entities.
Q. | Other Risks — The Fund will seek to gain exposure to commodity markets primarily through an investment in the Subsidiary and through investments in exchange-traded funds and commodity-linked derivatives. The Subsidiary, unlike the Fund, may invest without limitation in commodities, commodity-linked derivatives and other securities, such as exchange-traded and commodity-linked notes, that may provide leveraged and non-leveraged exposure to commodity markets. The Fund is indirectly exposed to the risks associated with the Subsidiary’s investments. |
R. | Leverage Risk — Leverage exists when the Fund can lose more than it originally invests because it purchases or sells an instrument or enters into a transaction without investing an amount equal to the full economic exposure of the instrument or transaction. |
S. | Collateral — To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund’s practice to replace such collateral no later than the next business day. |
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NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $250 million | 1.10% | |||
Next $250 million | 1.08% | |||
Next $500 million | 1.05% | |||
Next $1.5 billion | 1.03% | |||
Next $2.5 billion | 1.00% | |||
Next $2.5 billion | 0.98% | |||
Next $2.5 billion | 0.95% | |||
Over $10 billion | 0.93% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 1.10%.
The Subsidiary has entered into a separate contract with the Adviser whereby the Adviser provides investment advisory and other services to the Subsidiary. In consideration of these services, the Subsidiary pays an advisory fee to the Adviser based on the annual rate of the Subsidiary’s average daily net assets as set forth in the table above.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (including prior fiscal year-end Acquired Fund Fees and Expenses of 0.03% and excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.44%, 2.19%, 1.69%, 1.19%, 1.19% and 1.19%, respectively, of average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Acquired Fund Fees and Expenses are not operating expenses of the Fund directly, but are fees and expenses, including management fees of the investment companies in which the Fund invests. As a result, the total annual fund operating expenses after expense reimbursement may exceed the expense limits above. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives on the Fund’s investments in certain affiliated funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $656,019 and reimbursed class level expenses of $7,840, $4,691, $12, $47,346, $0 and $133 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Consolidated Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Consolidated Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Consolidated Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $604 in
49 Invesco Global Targeted Returns Fund
front-end sales commissions from the sale of Class A shares and $9,606 and $177 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were transfers from Level 1 to Level 2 of $23,700,597 and from Level 2 to Level 1 of $657,405, due to foreign fair value adjustments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Common Stocks & Other Equity Interests | $ | 11,752,917 | $ | 37,763,066 | $ | — | $ | 49,515,983 | ||||||||
Non-U.S. Dollar Denominated Bonds & Notes | — | 25,182,131 | — | 25,182,131 | ||||||||||||
U.S. Dollar Denominated Bonds & Notes | — | 13,793,611 | — | 13,793,611 | ||||||||||||
U.S. Treasury Securities | — | 754,682 | — | 754,682 | ||||||||||||
Preferred Stocks | 38,418 | 9,975 | — | 48,393 | ||||||||||||
Money Market Funds | 28,335,936 | — | — | 28,335,936 | ||||||||||||
Options Purchased | — | 7,999,354 | — | 7,999,354 | ||||||||||||
Total Investments in Securities | 40,127,271 | 85,502,819 | — | 125,630,090 | ||||||||||||
Other Investments — Assets* | ||||||||||||||||
Forward Foreign Currency Contracts | — | 2,929,305 | — | 2,929,305 | ||||||||||||
Futures Contracts | 902,062 | — | — | 902,062 | ||||||||||||
Swap Agreements | — | 3,921,123 | — | 3,921,123 | ||||||||||||
902,062 | 6,850,428 | — | 7,752,490 | |||||||||||||
Other Investments — Liabilities* | ||||||||||||||||
Forward Foreign Currency Contracts | — | (2,123,997 | ) | — | (2,123,997 | ) | ||||||||||
Futures Contracts | (1,555,647 | ) | — | — | (1,555,647 | ) | ||||||||||
Options Written | — | (4,531,395 | ) | — | (4,531,395 | ) | ||||||||||
Swap Agreements | — | (5,453,220 | ) | — | (5,453,220 | ) | ||||||||||
(1,555,647 | ) | (12,108,612 | ) | — | (13,664,259 | ) | ||||||||||
Total Other Investments | (653,585 | ) | (5,258,184 | ) | — | (5,911,769 | ) | |||||||||
Total Investments | $ | 39,473,686 | $ | 80,244,635 | $ | — | $ | 119,718,321 |
* | Forward foreign currency contracts, futures contracts and swap agreements are valued at unrealized appreciation (depreciation). Options written are shown at value. |
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
50 Invesco Global Targeted Returns Fund
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Consolidated Statement of Assets and Liabilities.
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2018:
Value | ||||||||||||||||||||||||
Derivative Assets | Commodity Risk | Credit Risk | Currency Risk | Equity Risk | Interest Rate Risk | Total | ||||||||||||||||||
Unrealized appreciation on futures contracts — Exchange-Traded(a) | $ | — | $ | — | $ | — | $ | 891,261 | $ | 10,801 | $ | 902,062 | ||||||||||||
Unrealized appreciation on swap agreements — Centrally Cleared(a) | — | 63,262 | — | — | 2,282,039 | 2,345,301 | ||||||||||||||||||
Unrealized appreciation on swap agreements — OTC | 64,055 | — | — | 911,789 | 599,978 | 1,575,822 | ||||||||||||||||||
Options purchased, at value — OTC(b) | — | — | 556,675 | 7,442,679 | — | 7,999,354 | ||||||||||||||||||
Unrealized appreciation on forward foreign currency contracts outstanding | — | — | 2,929,305 | — | — | 2,929,305 | ||||||||||||||||||
Total Derivative Assets | 64,055 | 63,262 | 3,485,980 | 9,245,729 | 2,892,818 | 15,751,844 | ||||||||||||||||||
Derivatives not subject to master netting agreements | — | (63,262 | ) | — | (891,261 | ) | (2,292,840 | ) | (3,247,363 | ) | ||||||||||||||
Total Derivative Assets subject to master netting agreements | $ | 64,055 | $ | — | $ | 3,485,980 | $ | 8,354,468 | $ | 599,978 | $ | 12,504,481 | ||||||||||||
Value | ||||||||||||||||||||||||
Derivative Liabilities | Commodity Risk | Credit Risk | Currency Risk | Equity Risk | Interest Rate Risk | Total | ||||||||||||||||||
Unrealized depreciation on futures contracts — Exchange-Traded(a) | $ | — | $ | — | $ | — | $ | (1,529,765 | ) | $ | (25,882 | ) | $ | (1,555,647 | ) | |||||||||
Unrealized depreciation on swap agreements — Centrally Cleared(a) | — | (411,198 | ) | — | — | (3,368,232 | ) | (3,779,430 | ) | |||||||||||||||
Unrealized depreciation on swap agreements — OTC | (8,362 | ) | — | — | (910,010 | ) | (755,418 | ) | (1,673,790 | ) | ||||||||||||||
Options written, at value — OTC | — | — | (219,383 | ) | (4,312,012 | ) | — | (4,531,395 | ) | |||||||||||||||
Unrealized depreciation on forward foreign currency contracts outstanding | — | — | (2,123,997 | ) | — | — | (2,123,997 | ) | ||||||||||||||||
Total Derivative Liabilities | (8,362 | ) | (411,198 | ) | (2,343,380 | ) | (6,751,787 | ) | (4,149,532 | ) | (13,664,259 | ) | ||||||||||||
Derivatives not subject to master netting agreements | — | 411,198 | — | 1,529,765 | 3,394,114 | 5,335,077 | ||||||||||||||||||
Total Derivative Liabilities subject to master netting agreements | $ | (8,362 | ) | $ | — | $ | (2,343,380 | ) | $ | (5,222,022 | ) | $ | (755,418 | ) | $ | (8,329,182 | ) |
(a) | The daily variation margin receivable (payable) at period-end is recorded in the Consolidated Statement of Assets and Liabilities. |
(b) | Options purchased, at value as reported in the Consolidated Schedule of Investments. |
51 Invesco Global Targeted Returns Fund
Offsetting Assets and Liabilities
The table below reflects the Fund’s exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of April 30, 2018.
Financial Derivative Assets | Financial Derivative Liabilities | Collateral (Received)/Pledged | Net Amount(a) | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Options Purchased | Swap Agreements | Total Assets | Forward Foreign Currency Contracts | Options Written | Swap Agreements | Total Liabilities | Net Value of Derivatives | Non-Cash | Cash | |||||||||||||||||||||||||||||||||||||
Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
Bank of America Merrill Lynch | $ | — | $ | 334,782 | $ | — | $ | 334,782 | $ | — | $ | (494,597 | ) | $ | — | $ | (494,597 | ) | $ | (159,815 | ) | $ | — | $ | — | $ | (159,815 | ) | ||||||||||||||||||||
Barclays Bank PLC | 262,136 | 1,221,181 | — | 1,483,317 | (702,311 | ) | (489,205 | ) | — | (1,191,516 | ) | 291,801 | — | (291,801 | ) | — | ||||||||||||||||||||||||||||||||
BNP Paribas S.A. | — | 26,560 | 15,217 | 41,777 | — | (16,887 | ) | (35,130 | ) | (52,017 | ) | (10,240 | ) | — | 10,240 | — | ||||||||||||||||||||||||||||||||
Citigroup Global Markets Inc. | 214,888 | 35,897 | 26,226 | 277,011 | (23,621 | ) | (64,328 | ) | (55,169 | ) | (143,118 | ) | 133,893 | — | (133,893 | ) | — | |||||||||||||||||||||||||||||||
Deutsche Bank Securities Inc. | 662,792 | 88,336 | — | 751,128 | (155,929 | ) | (8,362 | ) | — | (164,291 | ) | 586,837 | — | (586,837 | ) | — | ||||||||||||||||||||||||||||||||
Goldman Sachs International | 438,497 | 320,542 | 1,655 | 760,694 | (1,159,161 | ) | (53,702 | ) | (21,637 | ) | (1,234,500 | ) | (473,806 | ) | — | 380,000 | (93,806 | ) | ||||||||||||||||||||||||||||||
HSBC New York | — | 4,888 | — | 4,888 | — | — | — | — | 4,888 | — | — | 4,888 | ||||||||||||||||||||||||||||||||||||
J.P. Morgan Chase Bank, N.A. | 82,929 | 274,848 | 329,724 | 687,501 | (41,281 | ) | (399,875 | ) | (190,615 | ) | (631,771 | ) | 55,730 | — | (55,730 | ) | — | |||||||||||||||||||||||||||||||
J.P. Morgan Securities LLC | — | 1,902,047 | — | 1,902,047 | — | — | — | — | 1,902,047 | — | — | 1,902,047 | ||||||||||||||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | — | 112,713 | — | 112,713 | (10,234 | ) | (3,766 | ) | — | (14,000 | ) | 98,713 | — | (98,713 | ) | — | ||||||||||||||||||||||||||||||||
Normuda International PLC | — | 12,845 | — | 12,845 | — | — | — | — | 12,845 | — | (12,845 | ) | — | |||||||||||||||||||||||||||||||||||
Societe Generale | — | 2,216,440 | 121,668 | 2,338,108 | — | (2,150,203 | ) | (215,837 | ) | (2,366,040 | ) | (27,932 | ) | — | — | (27,932 | ) | |||||||||||||||||||||||||||||||
Standard Chartered Bank PLC | 41,848 | — | — | 41,848 | (9,644 | ) | — | — | (9,644 | ) | 32,204 | — | — | 32,204 | ||||||||||||||||||||||||||||||||||
State Street Bank & Trust Co. | 1,226,215 | — | — | 1,226,215 | (21,816 | ) | — | — | (21,816 | ) | 1,204,399 | — | (1,110,000 | ) | 94,399 | |||||||||||||||||||||||||||||||||
UBS | — | 1,448,275 | 571,410 | 2,019,685 | — | (850,470 | ) | (432,951 | ) | (1,283,421 | ) | 736,264 | — | (430,000 | ) | 306,264 | ||||||||||||||||||||||||||||||||
Subtotal — Fund | 2,929,305 | 7,999,354 | 1,065,900 | 11,994,559 | (2,123,997 | ) | (4,531,395 | ) | (951,339 | ) | (7,606,731 | ) | 4,387,828 | — | (2,329,579 | ) | 2,058,249 | |||||||||||||||||||||||||||||||
Subsidiary | ||||||||||||||||||||||||||||||||||||||||||||||||
Barclays Bank PLC | — | — | 417,225 | 417,225 | — | — | (186,427 | ) | (186,427 | ) | 230,798 | — | (180,000 | ) | 50,798 | |||||||||||||||||||||||||||||||||
BNP Paribas S.A. | — | — | 2,097 | 2,097 | — | — | (438 | ) | (438 | ) | 1,659 | — | — | 1,659 | ||||||||||||||||||||||||||||||||||
Citigroup Global Markets Inc. | — | — | — | — | — | — | (116,065 | ) | (116,065 | ) | (116,065 | ) | — | 116,065 | — | |||||||||||||||||||||||||||||||||
Goldman Sachs International | — | — | 65,471 | 65,471 | — | — | (230,167 | ) | (230,167 | ) | (164,696 | ) | — | 164,696 | — | |||||||||||||||||||||||||||||||||
Macquarie Bank Ltd. | — | — | 61,958 | 61,958 | — | — | (7,924 | ) | (7,924 | ) | 54,034 | — | — | 54,034 | ||||||||||||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | — | — | 123,227 | 123,227 | — | — | (223,356 | ) | (223,356 | ) | (100,129 | ) | — | 50,000 | (50,129 | ) | ||||||||||||||||||||||||||||||||
Subtotal — Subsidiary | $ | — | $ | — | $ | 669,978 | $ | 669,978 | $ | — | $ | — | $ | (764,377 | ) | $ | (764,377 | ) | $ | (94,399 | ) | $ | — | $ | 150,761 | $ | 56,362 | |||||||||||||||||||||
Total | $ | 2,929,305 | $ | 7,999,354 | $ | 1,735,878 | $ | 12,664,537 | $ | (2,123,997 | ) | $ | (4,531,395 | ) | $ | (1,715,716 | ) | $ | (8,371,108 | ) | $ | 4,293,429 | $ | — | $ | (2,178,818 | ) | $ | 2,114,611 |
(a) | The Fund and the Subsidiary are recognized as separate legal entities and as such are subject to separate netting arrangements with the Counterparty. |
52 Invesco Global Targeted Returns Fund
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Consolidated Statement of Operations | ||||||||||||||||||||||||
Commodity Risk | Credit Risk | Currency Risk | Equity Risk | Interest Rate Risk | Total | |||||||||||||||||||
Realized Gain (Loss): | ||||||||||||||||||||||||
Forward foreign currency contracts | $ | — | $ | — | $ | (4,926,172 | ) | $ | — | $ | — | $ | (4,926,172 | ) | ||||||||||
Futures contracts | — | — | — | (1,587,595 | ) | (21,635 | ) | (1,609,230 | ) | |||||||||||||||
Options purchased(a) | — | — | (4,050,497 | ) | (3,953,740 | ) | — | (8,004,237 | ) | |||||||||||||||
Options written | — | — | 1,268,752 | 2,341,425 | — | 3,610,177 | ||||||||||||||||||
Swap agreements | (1,343,798 | ) | (155,334 | ) | — | (638,757 | ) | 614,044 | (1,523,845 | ) | ||||||||||||||
Change in Net Unrealized Appreciation (Depreciation): |
| |||||||||||||||||||||||
Forward foreign currency contracts | — | — | 1,558,078 | — | — | 1,558,078 | ||||||||||||||||||
Futures contracts | — | — | — | 941,026 | 244,465 | 1,185,491 | ||||||||||||||||||
Options purchased(a) | — | — | 2,106,767 | 3,790,450 | — | 5,897,217 | ||||||||||||||||||
Options written | — | — | (424,257 | ) | 224,982 | — | (199,275 | ) | ||||||||||||||||
Swap agreements | 77,932 | 26,220 | — | 505,513 | (1,181,101 | ) | (571,436 | ) | ||||||||||||||||
Total | $ | (1,265,866 | ) | $ | (129,114 | ) | $ | (4,467,329 | ) | $ | 1,623,304 | $ | (344,227 | ) | $ | (4,583,232 | ) |
(a) | Options purchased are included in the net realized gain (loss) from investment securities and the change in net unrealized appreciation (depreciation) of investment securities. |
The table below summarizes the average notional value of forward foreign currency contracts, futures contracts, options purchased, options written and swap agreements outstanding during the period.
Forward Foreign Currency Contracts | Futures Contracts | Index Options Purchased | Index Options Written | Foreign Currency Options | Swap Agreements | |||||||||||||||||||
Average notional value | $ | 258,320,797 | $ | 92,196,776 | $ | 162,684,834 | $ | 70,274,137 | $ | 115,895,487 | $ | 775,426,571 | ||||||||||||
Average contracts | — | — | 6,157 | 1,684 | — | — |
NOTE 5—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $135.
NOTE 6—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Fund.
NOTE 7—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Consolidated Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 8—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
53 Invesco Global Targeted Returns Fund
The Fund had a capital loss carryforward as of October 31, 2017, which expires as follows:
Capital Loss Carryforward* | ||||||||||||
Expiration | Short-Term | Long-Term | Total | |||||||||
Not subject to expiration | $ | — | $ | 6,333,130 | $ | 6,333,130 |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
NOTE 9—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $34,567,970 and $48,257,817, respectively. During the same period, purchases and sales of U.S. Treasury obligations were $907,412 and $1,293,751, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 25,464,484 | ||
Aggregate unrealized (depreciation) of investments | (17,831,826 | ) | ||
Net unrealized appreciation of investments | $ | 7,632,658 |
Cost of investments for tax purposes is $111,298,106.
NOTE 10—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 158,603 | $ | 1,579,881 | 432,607 | $ | 4,320,006 | ||||||||||
Class C | 18,279 | 178,004 | 170,628 | 1,667,723 | ||||||||||||
Class R | 15 | 150 | 981 | 9,707 | ||||||||||||
Class Y | 2,487,174 | 25,000,963 | 5,299,391 | 52,987,480 | ||||||||||||
Class R6 | 318,193 | 3,167,385 | 869,493 | 8,703,963 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | — | — | 109,618 | 1,068,780 | ||||||||||||
Class C | — | — | 60,540 | 582,399 | ||||||||||||
Class R | — | — | 31 | 300 | ||||||||||||
Class Y | — | — | 736,278 | 7,193,440 | ||||||||||||
Class R5 | — | — | 246 | 2,402 | ||||||||||||
Reacquired: | ||||||||||||||||
Class A | (445,578 | ) | (4,425,511 | ) | (1,444,640 | ) | (14,471,961 | ) | ||||||||
Class C | (291,109 | ) | (2,838,487 | ) | (601,188 | ) | (5,868,873 | ) | ||||||||
Class Y | (3,148,023 | ) | (31,513,082 | ) | (12,178,368 | ) | (121,949,467 | ) | ||||||||
Class R5 | — | — | (5,347 | ) | (53,554 | ) | ||||||||||
Class R6 | (25,949 | ) | (259,995 | ) | (11,067 | ) | (111,623 | ) | ||||||||
Net increase (decrease) in share activity | (928,395 | ) | $ | (9,110,692 | ) | (6,560,797 | ) | $ | (65,919,278 | ) |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 59% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
In addition, 8% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser. |
54 Invesco Global Targeted Returns Fund
NOTE 11—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Return of capital | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | ||||||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 10.00 | $ | 0.05 | $ | (0.15 | ) | $ | (0.10 | ) | $ | — | $ | — | $ | — | $ | — | $ | 9.90 | (1.00 | )% | $ | 16,325 | 1.39 | %(d) | 2.40 | %(d) | 1.00 | %(d) | 38 | % | ||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.32 | 0.12 | 0.00 | 0.12 | (0.12 | ) | (0.01 | ) | (0.31 | ) | (0.44 | ) | 10.00 | 1.32 | 19,360 | 1.29 | 2.16 | 1.24 | 121 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.33 | 0.05 | 0.14 | 0.19 | (0.06 | ) | — | (0.14 | ) | (0.20 | ) | 10.32 | 1.90 | 29,309 | 1.31 | (e) | 2.35 | 0.51 | 23 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.44 | 0.01 | 0.04 | 0.05 | (0.06 | ) | — | (0.10 | ) | (0.16 | ) | 10.33 | 0.49 | 23,688 | 1.33 | (e) | 2.38 | 0.05 | 79 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.02 | ) | 0.46 | 0.44 | — | — | — | — | 10.44 | 4.40 | 13,504 | 1.29 | (e)(g) | 3.16 | (g) | (0.18 | )(g) | 20 | |||||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.80 | 0.01 | (0.14 | ) | (0.13 | ) | — | — | — | — | 9.67 | (1.33 | ) | 9,456 | 2.14 | (d) | 3.15 | (d) | 0.25 | (d) | 38 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.13 | 0.05 | (0.01 | ) | 0.04 | (0.06 | ) | (0.00 | ) | (0.31 | ) | (0.37 | ) | 9.80 | 0.52 | 12,263 | 2.04 | 2.91 | 0.49 | 121 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.19 | (0.02 | ) | 0.14 | 0.12 | (0.04 | ) | — | (0.14 | ) | (0.18 | ) | 10.13 | 1.17 | 16,428 | 2.06 | (e) | 3.10 | (0.24 | ) | 23 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.37 | (0.07 | ) | 0.04 | (0.03 | ) | (0.05 | ) | — | (0.10 | ) | (0.15 | ) | 10.19 | (0.27 | ) | 11,524 | 2.08 | (e) | 3.13 | (0.70 | ) | 79 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.08 | ) | 0.45 | 0.37 | — | — | — | — | 10.37 | 3.70 | 444 | 2.04 | (e)(g) | 3.91 | (g) | (0.93 | )(g) | 20 | |||||||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.94 | 0.04 | (0.15 | ) | (0.11 | ) | — | — | — | — | 9.83 | (1.11 | ) | 26 | 1.64 | (d) | 2.65 | (d) | 0.75 | (d) | 38 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.27 | 0.10 | (0.01 | ) | 0.09 | (0.10 | ) | (0.01 | ) | (0.31 | ) | (0.42 | ) | 9.94 | 0.99 | 26 | 1.54 | 2.41 | 0.99 | 121 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.29 | 0.03 | 0.14 | 0.17 | (0.05 | ) | — | (0.14 | ) | (0.19 | ) | 10.27 | 1.65 | 17 | 1.56 | (e) | 2.60 | 0.26 | 23 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.42 | (0.02 | ) | 0.04 | 0.02 | (0.05 | ) | — | (0.10 | ) | (0.15 | ) | 10.29 | 0.27 | 10 | 1.58 | (e) | 2.63 | (0.20 | ) | 79 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.04 | ) | 0.46 | 0.42 | — | — | — | — | 10.42 | 4.20 | 10 | 1.54 | (e)(g) | 3.41 | (g) | (0.43 | )(g) | 20 | |||||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.04 | 0.06 | (0.15 | ) | (0.09 | ) | — | — | — | — | 9.95 | (0.90 | ) | 100,532 | 1.14 | (d) | 2.15 | (d) | 1.25 | (d) | 38 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.37 | 0.15 | (0.01 | ) | 0.14 | (0.15 | ) | (0.01 | ) | (0.31 | ) | (0.47 | ) | 10.04 | 1.48 | 108,068 | 1.04 | 1.91 | 1.49 | 121 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.37 | 0.08 | 0.15 | 0.23 | (0.09 | ) | — | (0.14 | ) | (0.23 | ) | 10.37 | 2.24 | 175,284 | 1.06 | (e) | 2.10 | 0.76 | 23 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.46 | 0.03 | 0.04 | 0.07 | (0.06 | ) | — | (0.10 | ) | (0.16 | ) | 10.37 | 0.72 | 97,703 | 1.08 | (e) | 2.13 | 0.30 | 79 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.01 | 0.45 | 0.46 | — | — | — | — | 10.46 | 4.60 | 16,352 | 1.04 | (e)(g) | 2.91 | (g) | 0.07 | (g) | 20 | ||||||||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.05 | 0.06 | (0.15 | ) | (0.09 | ) | — | — | — | — | 9.96 | (0.90 | ) | 10 | 1.14 | (d) | 2.06 | (d) | 1.25 | (d) | 38 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.37 | 0.15 | 0.00 | 0.15 | (0.15 | ) | (0.01 | ) | (0.31 | ) | (0.47 | ) | 10.05 | 1.58 | 10 | 1.04 | 1.87 | 1.49 | 121 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.38 | 0.08 | 0.14 | 0.22 | (0.09 | ) | — | (0.14 | ) | (0.23 | ) | 10.37 | 2.15 | 63 | 1.06 | (e) | 2.09 | 0.76 | 23 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.46 | 0.03 | 0.05 | 0.08 | (0.06 | ) | — | (0.10 | ) | (0.16 | ) | 10.38 | 0.82 | 62 | 1.08 | (e) | 2.07 | 0.30 | 79 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.01 | 0.45 | 0.46 | — | — | — | — | 10.46 | 4.60 | 2,724 | 1.04 | (e)(g) | 2.87 | (g) | 0.07 | (g) | 20 | ||||||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.04 | 0.06 | (0.15 | ) | (0.09 | ) | — | — | — | — | 9.95 | (0.90 | ) | 11,458 | 1.14 | (d) | 2.06 | (d) | 1.25 | (d) | 38 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.36 | 0.15 | 0.00 | 0.15 | (0.15 | ) | (0.01 | ) | (0.31 | ) | (0.47 | ) | 10.04 | 1.59 | 8,626 | 1.04 | 1.81 | 1.49 | 121 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.37 | 0.08 | 0.14 | 0.22 | (0.09 | ) | — | (0.14 | ) | (0.23 | ) | 10.36 | 2.14 | 10 | 1.06 | (e) | 2.00 | 0.76 | 23 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.46 | 0.03 | 0.04 | 0.07 | (0.06 | ) | — | (0.10 | ) | (0.16 | ) | 10.37 | 0.73 | 8,063 | 1.08 | (e) | 2.07 | 0.30 | 79 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.01 | 0.45 | 0.46 | — | — | — | — | 10.46 | 4.60 | 9,298 | 1.04 | (e)(g) | 2.87 | (g) | 0.07 | (g) | 20 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $17,723, $10,604, $26, $107,028, $10 and $8,552 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | In addition to the fees and expenses which the Fund bears directly; the Fund indirectly bears a pro rata share of the fees and expenses of the underlying funds in which the Fund invests. Because the underlying funds have varied expenses and fee levels and the Fund may own different proportions at different times, the amount of fees and expenses incurred indirectly by the Fund will vary. Estimated underlying fund expenses are not expenses that are incurred directly by your Fund. They are expenses that are incurred directly by the underlying funds and are deducted from the value of the funds your Fund invests in. The effect of the estimated underlying fund expenses that you bear indirectly is included in your Fund’s total return. Estimated acquired fund fees from underlying funds were 0.44%, 0.44% and 0.50% for the years ended October 31, 2016 and 2015 and the period ended October 31, 2014. |
(f) | Commencement date of December 19, 2013. |
(g) | Annualized. |
55 Invesco Global Targeted Returns Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 990.00 | $ | 6.86 | $ | 1,017.90 | $ | 6.95 | 1.39 | % | ||||||||||||
C | 1,000.00 | 986.70 | 10.54 | 1,014.18 | 10.69 | 2.14 | ||||||||||||||||||
R | 1,000.00 | 988.90 | 8.09 | 1,016.66 | 8.20 | 1.64 | ||||||||||||||||||
Y | 1,000.00 | 991.00 | 5.63 | 1,019.14 | 5.71 | 1.14 | ||||||||||||||||||
R5 | 1,000.00 | 991.00 | 5.63 | 1,019.14 | 5.71 | 1.14 | ||||||||||||||||||
R6 | 1,000.00 | 991.00 | 5.63 | 1,019.14 | 5.71 | 1.14 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
56 Invesco Global Targeted Returns Fund
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Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
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To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. GTR-SAR-1 06142018 0953
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco Greater China Fund
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Nasdaq: | ||||
A: AACFX ∎ C: CACFX ∎ Y: AMCYX ∎ R5: IACFX ∎ R6: CACSX |
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2
| Fund Performance
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4
| Letters to Shareholders
| |||
5
| Schedule of Investments
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7
| Financial Statements
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9
| Notes to Financial Statements
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15
| Financial Highlights
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16
| Fund Expenses
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For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 0.08 | % | ||
Class C Shares | -0.28 | |||
Class Y Shares | 0.22 | |||
Class R5 Shares | 0.29 | |||
Class R6 Shares | 0.28 | |||
MSCI Golden Dragon Index▼ (Broad Market/Style-Specific) | 4.34 | |||
Lipper China Region Funds Index∎ (Peer Group Index) | 6.09 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
|
The MSCI Golden Dragon Index captures the equity market performance of large- and mid-cap China securities and non-domestic China securities listed in Hong Kong and Taiwan. The index is computed using the net return, which withholds applicable taxes for non-resident investors.
The Lipper China Region Funds Index is an unmanaged index considered representative of China region funds tracked by Lipper.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Greater China Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
| ||||||
Class A Shares |
| |||||
Inception (3/31/06) | 9.71 | % | ||||
10 Years | 4.47 | |||||
5 Years | 8.63 | |||||
1 Year | 15.75 | |||||
Class C Shares |
| |||||
Inception (3/31/06) | 9.40 | % | ||||
10 Years | 4.29 | |||||
5 Years | 9.05 | |||||
1 Year | 20.60 | |||||
Class Y Shares |
| |||||
10 Years | 5.31 | % | ||||
5 Years | 10.14 | |||||
1 Year | 22.83 | |||||
Class R5 Shares |
| |||||
Inception (3/31/06) | 10.74 | % | ||||
10 Years | 5.58 | |||||
5 Years | 10.37 | |||||
1 Year | 23.06 | |||||
Class R6 Shares |
| |||||
10 Years | 5.11 | % | ||||
5 Years | 9.96 | |||||
1 Year | 23.00 |
Class Y shares incepted on October 3, 2008. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
Class R6 shares incepted on April 4, 2017. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C,
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (3/31/06) | 10.10 | % | ||||
10 Years | 6.15 | |||||
5 Years | 9.83 | |||||
1 Year | 23.91 | |||||
Class C Shares |
| |||||
Inception (3/31/06) | 9.80 | % | ||||
10 Years | 5.96 | |||||
5 Years | 10.25 | |||||
1 Year | 29.14 | |||||
Class Y Shares |
| |||||
10 Years | 7.00 | % | ||||
5 Years | 11.35 | |||||
1 Year | 31.42 | |||||
Class R5 Shares |
| |||||
Inception (3/31/06) | 11.14 | % | ||||
10 Years | 7.28 | |||||
5 Years | 11.58 | |||||
1 Year | 31.66 | |||||
Class R6 Shares |
| |||||
10 Years | 6.79 | % | ||||
5 Years | 11.17 | |||||
1 Year | 31.65 |
Class Y, Class R5 and Class R6 shares was 1.93%, 2.68%, 1.68%, 1.50% and 1.47%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
3 Invesco Greater China Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including performance, holdings and portfolio manager commentaries. You can access information about |
your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Greater China Fund
Schedule of Investments(a)
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–98.88%(b) |
| |||||||
Apparel Retail–1.57% | ||||||||
Pou Sheng International (Holdings) Ltd. (Hong Kong) | 9,261,000 | $ | 1,545,742 | |||||
Auto Parts & Equipment–5.35% | ||||||||
Hu Lane Associate Inc. (Taiwan) | 257,000 | 1,201,743 | ||||||
HUAYU Automotive Systems Co., Ltd.–Class A | 630,104 | 2,199,423 | ||||||
Minth Group Ltd. | 396,000 | 1,881,740 | ||||||
5,282,906 | ||||||||
Automobile Manufacturers–0.44% | ||||||||
Jiangling Motors Corp., Ltd.–Class B | 311,100 | 430,861 | ||||||
Commodity Chemicals–4.28% | ||||||||
Formosa Chemicals & Fibre Corp. (Taiwan) | 532,000 | 1,952,625 | ||||||
Formosa Plastics Corp. (Taiwan) | 646,000 | 2,266,295 | ||||||
4,218,920 | ||||||||
Construction Materials–0.73% | ||||||||
Asia Cement China Holdings Corp. | 1,343,500 | 720,009 | ||||||
Diversified Banks–0.45% | ||||||||
BOC Hong Kong (Holdings) Ltd. | 86,500 | 446,783 | ||||||
Electrical Components & Equipment–3.97% | ||||||||
Voltronic Power Technology Corp. (Taiwan) | 59,150 | 1,051,501 | ||||||
Zhuzhou CRRC Times Electric Co., Ltd.–Class H | 539,900 | 2,862,776 | ||||||
3,914,277 | ||||||||
Electronic Components–3.33% | ||||||||
Chin-Poon Industrial Co., Ltd. (Taiwan) | 647,000 | 851,971 | ||||||
Largan Precision Co., Ltd. (Taiwan) | 21,000 | 2,434,938 | ||||||
3,286,909 | ||||||||
Electronic Equipment & Instruments–0.58% | ||||||||
Flytech Technology Co., Ltd. (Taiwan) | 220,000 | 575,145 | ||||||
Electronic Manufacturing Services–4.28% | ||||||||
FIH Mobile Ltd. | 877,000 | 150,377 | ||||||
Hon Hai Precision Industry Co., Ltd. (Taiwan) | 1,465,000 | 4,075,648 | ||||||
4,226,025 | ||||||||
Food Retail–2.75% | ||||||||
President Chain Store Corp. (Taiwan) | 276,000 | 2,712,283 | ||||||
Footwear–1.06% | ||||||||
Stella International Holdings Ltd. | 886,000 | 1,046,457 | ||||||
Gas Utilities–3.13% | ||||||||
ENN Energy Holdings Ltd. | 131,000 | 1,231,787 | ||||||
Towngas China Co. Ltd. | 2,082,000 | 1,853,681 | ||||||
3,085,468 | ||||||||
Health Care Distributors–1.50% | ||||||||
Sinopharm Group Co. Ltd.–Class H | 350,400 | 1,477,746 |
Shares | Value | |||||||
Health Care Equipment–2.16% | ||||||||
MicroPort Scientific Corp. | 1,832,000 | $ | 2,136,337 | |||||
Health Care Supplies–1.90% | ||||||||
Shandong Weigao Group Medical Polymer Co. Ltd.–Class H | 3,036,000 | 1,872,212 | ||||||
Home Entertainment Software–1.09% | ||||||||
Changyou.com Ltd.–ADR | 56,500 | 1,075,195 | ||||||
Hotels, Resorts & Cruise Lines–1.72% | ||||||||
China International Travel Service Corp Ltd.–Class A | 90,100 | 736,134 | ||||||
Shanghai Jinjiang International Hotels Development Co., Ltd.–Class B | 381,578 | 956,594 | ||||||
1,692,728 | ||||||||
Hypermarkets & Super Centers–2.86% | ||||||||
Sun Art Retail Group Ltd. (Hong Kong) | 2,515,000 | 2,825,762 | ||||||
Industrial Conglomerates–1.02% | ||||||||
Beijing Enterprises Holdings Ltd. | 200,500 | 1,001,927 | ||||||
Industrial Machinery–1.25% | ||||||||
CIMC Enric Holdings Ltd.(c) | 1,190,000 | 1,233,201 | ||||||
Internet & Direct Marketing Retail–1.77% | ||||||||
Vipshop Holdings Ltd.–ADR(c) | 112,670 | 1,744,132 | ||||||
Internet Software & Services–17.58% | ||||||||
Alibaba Group Holding Ltd.–ADR(c) | 42,389 | 7,568,132 | ||||||
Autohome Inc.–ADR | 21,800 | 2,126,590 | ||||||
PChome Online Inc. (Taiwan) | 159,305 | 737,931 | ||||||
Tencent Holdings Ltd. | 89,800 | 4,408,891 | ||||||
YY Inc.–ADR(c) | 26,000 | 2,506,140 | ||||||
17,347,684 | ||||||||
Leisure Products–1.77% | ||||||||
Goodbaby International Holdings Ltd. | 2,750,000 | 1,744,240 | ||||||
Marine Ports & Services–2.84% | ||||||||
China Merchants Port Holdings Co. Ltd. | 682,000 | 1,523,868 | ||||||
Qingdao Port International Co., Ltd.–Class H–REGS(d) | 1,562,000 | 1,281,642 | ||||||
2,805,510 | ||||||||
Packaged Foods & Meats–1.84% | ||||||||
Qinqin Foodstuffs Group (Cayman) Co. Ltd.(c) | 55,600 | 16,506 | ||||||
Uni-President China Holdings Ltd. | 1,904,000 | 1,800,984 | ||||||
1,817,490 | ||||||||
Personal Products–2.09% | ||||||||
Hengan International Group Co. Ltd. | 232,500 | 2,063,153 | ||||||
Pharmaceuticals–0.24% | ||||||||
Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co., Ltd.–Class H | 477,000 | 232,385 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Greater China Fund
Shares | Value | |||||||
Research & Consulting Services–1.70% | ||||||||
Centre Testing International Group Co., Ltd.–Class A | 2,244,795 | $ | 1,676,330 | |||||
Restaurants–2.73% | ||||||||
Ajisen (China) Holdings Ltd. (Hong Kong) | 3,195,000 | 1,510,263 | ||||||
Café de Coral Holdings Ltd. (Hong Kong) | 332,000 | 814,929 | ||||||
Xiabuxiabu Catering Management China Holdings Co. Ltd.–REGS(d) | 217,000 | 372,344 | ||||||
2,697,536 | ||||||||
Semiconductor Equipment–2.49% | ||||||||
ASM Pacific Technology Ltd. (Hong Kong) | 179,500 | 2,452,361 | ||||||
Semiconductors–6.50% | ||||||||
MediaTek Inc. (Taiwan) | 207,000 | 2,355,886 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd. (Taiwan) | 536,000 | 4,060,594 | ||||||
6,416,480 | ||||||||
Steel–5.12% | ||||||||
Angang Steel Co. Ltd.–Class H | 1,696,000 | 1,818,167 | ||||||
Baoshan Iron & Steel Co., Ltd.–Class A | 2,208,209 | 3,233,538 | ||||||
5,051,705 | ||||||||
Technology Hardware, Storage & Peripherals–0.51% | ||||||||
Asustek Computer Inc. (Taiwan) | 54,000 | 505,587 |
Shares | Value | |||||||
Tires & Rubber–0.73% | ||||||||
Cheng Shin Rubber Industry Co., Ltd. (Taiwan) | 447,000 | $ | 719,752 | |||||
Wireless Telecommunication Services–5.55% | ||||||||
China Mobile Ltd. | 518,000 | 4,926,177 | ||||||
SmarTone Telecommunications Holdings Ltd. (Hong Kong) | 521,500 | 551,061 | ||||||
5,477,238 | ||||||||
Total Common Stocks & Other Equity Interests |
| 97,558,476 | ||||||
Money Market Funds–0.00% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(e) | 62 | 62 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(e) | 70 | 70 | ||||||
Total Money Market Funds |
| 132 | ||||||
TOTAL INVESTMENTS IN SECURITIES–98.88% |
| 97,558,608 | ||||||
OTHER ASSETS LESS LIABILITIES–1.12% |
| 1,106,959 | ||||||
NET ASSETS–100.00% |
| $ | 98,665,567 |
Investment Abbreviations:
ADR | – American Depositary Receipt | |
REGS | – Regulation S |
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Country of issuer and/or credit risk exposure listed in Common Stocks & Other Equity Interests has been determined to be China unless otherwise noted. |
(c) | Non-income producing security. |
(d) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2018 was $1,653,986, which represented 1.68% of the Fund’s Net Assets. |
(e) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2018
Information Technology | 36.4 | % | ||
Consumer Discretionary | 17.1 | |||
Industrials | 10.8 | |||
Materials | 10.1 | |||
Consumer Staples | 9.5 | |||
Health Care | 5.8 | |||
Telecommunication Services | 5.6 | |||
Utilities | 3.1 | |||
Financials | 0.5 | |||
Money Market Funds Plus Other Assets Less Liabilities | 1.1 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Greater China Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $89,205,190) | $ | 97,558,476 | ||
Investments in affiliated money market funds, at value and cost | 132 | |||
Cash | 295,507 | |||
Receivable for: | ||||
Investments sold | 2,001,147 | |||
Fund shares sold | 113,159 | |||
Dividends | 1,003 | |||
Investment for trustee deferred compensation and retirement plans | 55,661 | |||
Other assets | 48,313 | |||
Total assets | 100,073,398 | |||
Liabilities: |
| |||
Payable for: | ||||
Investments purchased | 299,774 | |||
Fund shares reacquired | 213,659 | |||
Amount due custodian — foreign (Cost $693,232) | 693,310 | |||
Accrued fees to affiliates | 72,670 | |||
Accrued trustees’ and officers’ fees and benefits | 1,525 | |||
Accrued other operating expenses | 65,612 | |||
Trustee deferred compensation and retirement plans | 61,281 | |||
Total liabilities | 1,407,831 | |||
Net assets applicable to shares outstanding | $ | 98,665,567 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 80,245,460 | ||
Undistributed net investment income (loss) | (729,100 | ) | ||
Undistributed net realized gain | 10,796,563 | |||
Net unrealized appreciation | 8,352,644 | |||
$ | 98,665,567 |
Net Assets: | ||||
Class A | $ | 73,367,860 | ||
Class C | $ | 12,765,075 | ||
Class Y | $ | 11,717,820 | ||
Class R5 | $ | 71,552 | ||
Class R6 | $ | 743,260 | ||
Shares outstanding, no par value, |
| |||
Class A | 2,507,557 | |||
Class C | 450,009 | |||
Class Y | 400,258 | |||
Class R5 | 2,444 | |||
Class R6 | 25,406 | |||
Class A: | ||||
Net asset value per share | $ | 29.26 | ||
Maximum offering price per share | ||||
(Net asset value of $29.26 ¸ 94.50%) | $ | 30.96 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 28.37 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 29.28 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 29.28 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 29.26 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Greater China Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of foreign withholding taxes of $11,424) | $ | 687,946 | ||
Dividends from affiliated money market funds | 11,600 | |||
Total investment income | 699,546 | |||
Expenses: | ||||
Advisory fees | 465,847 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 55,422 | |||
Distribution fees: | ||||
Class A | 92,020 | |||
Class B | 1,709 | |||
Class C | 67,099 | |||
Transfer agent fees — A, B, C and Y | 119,710 | |||
Transfer agent fees — R5 | 34 | |||
Transfer agent fees — R6 | 237 | |||
Trustees’ and officers’ fees and benefits | 11,379 | |||
Registration and filing fees | 42,413 | |||
Reports to shareholders | 15,686 | |||
Professional services fees | 38,217 | |||
Other | 6,485 | |||
Total expenses | 941,053 | |||
Less: Fees waived and expense offset arrangement(s) | (5,709 | ) | ||
Net expenses | 935,344 | |||
Net investment income (loss) | (235,798 | ) | ||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: |
| |||
Investment securities | 10,960,407 | |||
Foreign currencies | (20,430 | ) | ||
10,939,977 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | (10,908,003 | ) | ||
Foreign currencies | (617 | ) | ||
(10,908,620 | ) | |||
Net realized and unrealized gain | 31,357 | |||
Net increase (decrease) in net assets resulting from operations | $ | (204,441 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Greater China Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income (loss) | $ | (235,798 | ) | $ | 86,056 | |||
Net realized gain | 10,939,977 | 3,508,172 | ||||||
Change in net unrealized appreciation (depreciation) | (10,908,620 | ) | 18,738,674 | |||||
Net increase (decrease) in net assets resulting from operations | (204,441 | ) | 22,332,902 | |||||
Distributions to shareholders from net investment income: | ||||||||
Class A | (385,286 | ) | (354,279 | ) | ||||
Class Y | (84,412 | ) | (45,730 | ) | ||||
Class R5 | (635 | ) | (619 | ) | ||||
Class R6 | (996 | ) | — | |||||
Total distributions from net investment income | (471,329 | ) | (400,628 | ) | ||||
Share transactions–net: | ||||||||
Class A | 4,125,825 | 1,136,916 | ||||||
Class B | (834,194 | ) | (720,092 | ) | ||||
Class C | (636,540 | ) | (1,792,194 | ) | ||||
Class Y | 338,286 | 4,144,381 | ||||||
Class R5 | 257 | 243 | ||||||
Class R6 | 696,315 | 104,144 | ||||||
Net increase (decrease) in net assets resulting from share transactions | 3,689,949 | (2,873,398 | ) | |||||
Net increase in net assets | 3,014,179 | 24,805,672 | ||||||
Net assets: | ||||||||
Beginning of period | 95,651,388 | 70,845,716 | ||||||
End of period (includes undistributed net investment income (loss) of $(729,100) and $(21,973), respectively) | $ | 98,665,567 | $ | 95,651,388 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Greater China Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of five different classes of shares: Class A, Class C, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class Y, Class R5 and Class R6 shares are sold at net asset value. Effective November 30, 2010, new or additional investments in Class B shares are no longer permitted. Existing shareholders of Class B shares were permitted to continue to reinvest dividends and capital gains distributions in Class B shares until their conversion to Class A shares. Also, shareholders in Class B shares were able to exchange those shares for Class B shares of other Invesco Funds offering such shares until they converted to Class A shares. Generally, Class B shares automatically converted to Class A shares on or about the month-end, which was at least eight years after the date of purchase. Redemptions of Class B shares prior to the conversion date were subject to a CDSC. Effective January 26, 2018, all of the Fund’s outstanding Class B shares were converted to Class A shares, in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a
9 Invesco Greater China Fund
particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer |
10 Invesco Greater China Fund
derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
J. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
11 Invesco Greater China Fund
K. | Other Risks — Investing in a single-country mutual fund involves greater risk than investing in a more diversified fund due to lack of exposure to other countries. The political and economic conditions and changes in regulatory, tax or economic policy in a single country could significantly affect the market in that country and in surrounding or related countries. |
Investing in developing countries can add additional risk, such as high rates of inflation or sharply devalued currencies against the U.S. dollar.
Transaction costs are often higher and there may be delays in settlement procedures.
Certain securities issued by companies in China may be less liquid, harder to sell or more volatile than U.S. securities.
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||||||
First $250 million | 0 | .935% | ||||||
Next $250 million | 0 | .91% | ||||||
Next $500 million | 0 | .885% | ||||||
Next $1.5 billion | 0 | .86% | ||||||
Next $2.5 billion | 0 | .835% | ||||||
Next $2.5 billion | 0 | .81% | ||||||
Next $2.5 billion | 0 | .785% | ||||||
Over $10 billion | 0 | .76% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.935%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class Y, Class R5 and Class R6 shares to 2.25%, 3.00%, 2.00%, 2.00% and 2.00%, respectively, of the Fund’s average daily net assets (the “expense limits”). Prior to their conversion to Class A shares, the expense limit for Class B shares was 3.00% of average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $1,194.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A and Class C shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares and 1.00% of the average daily net assets of Class C shares. Prior to their conversion to Class A shares, the Fund paid an annual rate of 1.00% of the average daily net assets of Class B shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
12 Invesco Greater China Fund
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $21,948 in front-end sales commissions from the sale of Class A shares and $21 and $771 from Class A and Class C shares, respectively, for CDSC imposed on redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period.
During the six months ended April 30, 2018, there were transfers from Level 1 to Level 2 of $31,211,383 and from Level 2 to Level 1 of $1,046,457, due to foreign fair value adjustments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Common Stocks & Other Equity Interests | $ | 24,151,763 | $ | 73,406,713 | $ | — | $ | 97,558,476 | ||||||||
Money Market Funds | 132 | — | — | 132 | ||||||||||||
Total Investments | $ | 24,151,895 | $ | 73,406,713 | $ | — | $ | 97,558,608 |
NOTE 4—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $4,515.
NOTE 5—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 7—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
13 Invesco Greater China Fund
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2017.
NOTE 8—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $31,227,615 and $29,422,751, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 17,296,854 | ||
Aggregate unrealized (depreciation) of investments | (9,509,930 | ) | ||
Net unrealized appreciation of investments | $ | 7,786,924 |
Cost of investments for tax purposes is $89,771,684.
NOTE 9—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 403,665 | $ | 12,297,129 | 569,913 | $ | 14,502,235 | ||||||||||
Class B(b) | — | — | 1,033 | 23,318 | ||||||||||||
Class C | 40,787 | 1,201,430 | 45,152 | 1,130,270 | ||||||||||||
Class Y | 77,851 | 2,358,207 | 346,947 | 8,827,823 | ||||||||||||
Class R6(c) | 28,219 | 892,305 | 3,633 | 104,144 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 12,961 | 372,496 | 15,781 | 339,129 | ||||||||||||
Class Y | 2,244 | 64,471 | 1,898 | 40,746 | ||||||||||||
Class R5 | 15 | 444 | 20 | 432 | ||||||||||||
Class R6 | 31 | 881 | — | — | ||||||||||||
Conversion of Class B shares to Class A shares:(d) | ||||||||||||||||
Class A | 1,337 | 43,321 | 21,353 | 537,044 | ||||||||||||
Class B | (1,507 | ) | (43,321 | ) | (21,965 | ) | (537,044 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (286,105 | ) | (8,587,121 | ) | (592,344 | ) | (14,241,492 | ) | ||||||||
Class B(b) | (25,297 | ) | (790,873 | ) | (8,760 | ) | (206,366 | ) | ||||||||
Class C | (62,546 | ) | (1,837,970 | ) | (125,409 | ) | (2,922,464 | ) | ||||||||
Class Y | (68,568 | ) | (2,084,392 | ) | (194,454 | ) | (4,724,188 | ) | ||||||||
Class R5 | (6 | ) | (187 | ) | (8 | ) | (189 | ) | ||||||||
Class R6 | (6,477 | ) | (196,871 | ) | — | — | ||||||||||
Net increase in share activity | 116,604 | $ | 3,689,949 | 62,790 | $ | 2,873,398 |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 33% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
(b) | Class B shares activity for the period November 1, 2017 through January 26, 2018 (date of conversion) |
(c) | Commencement date of April 4, 2017. |
(d) | Effective as of the close of business January 26, 2018, all outstanding Class B shares were converted to Class A shares. |
14 Invesco Greater China Fund
NOTE 10—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||
Class A |
| |||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 29.40 | $ | (0.06 | )(d) | $ | 0.08 | $ | 0.02 | $ | (0.16 | ) | $ | 29.26 | 0.08 | % | $ | 73,368 | 1.81 | %(e) | 1.82 | %(e) | (0.41 | )%(d)(e) | 30 | % | ||||||||||||||||||||||
Year ended 10/31/17 | 22.23 | 0.05 | 7.27 | 7.32 | (0.15 | ) | 29.40 | 33.19 | 69,843 | 1.93 | 1.93 | 0.22 | 56 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 21.10 | 0.15 | 1.20 | 1.35 | (0.22 | ) | 22.23 | 6.51 | 52,479 | 1.93 | 1.93 | 0.74 | 52 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 19.93 | 0.18 | 1.08 | 1.26 | (0.09 | ) | 21.10 | 6.36 | 53,087 | 1.88 | 1.88 | 0.85 | 130 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 20.31 | (0.03 | ) | (0.13 | ) | (0.16 | ) | (0.22 | ) | 19.93 | (0.87 | ) | 62,957 | 1.85 | 1.85 | (0.15 | ) | 124 | ||||||||||||||||||||||||||||||
Year ended 10/31/13 | 17.90 | 0.09 | 2.44 | 2.53 | (0.12 | ) | 20.31 | 14.18 | 76,691 | 1.78 | 1.78 | 0.50 | 148 | |||||||||||||||||||||||||||||||||||
Class B |
| |||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18(f) | 28.50 | (0.08 | )(d) | 3.10 | 3.02 | — | 31.52 | 10.60 | — | 2.56 | (e) | 2.57 | (e) | (1.16 | )(d)(e) | 30 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 21.56 | (0.13 | ) | 7.07 | 6.94 | — | 28.50 | 32.19 | 764 | 2.68 | 2.68 | (0.53 | ) | 56 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.43 | (0.00 | ) | 1.16 | 1.16 | (0.03 | ) | 21.56 | 5.72 | 1,218 | 2.68 | 2.68 | (0.01 | ) | 52 | |||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 19.35 | 0.02 | 1.06 | 1.08 | — | 20.43 | 5.58 | 2,600 | 2.63 | 2.63 | 0.10 | 130 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 19.71 | (0.18 | ) | (0.14 | ) | (0.32 | ) | (0.04 | ) | 19.35 | (1.61 | ) | 5,303 | 2.60 | 2.60 | (0.90 | ) | 124 | ||||||||||||||||||||||||||||||
Year ended 10/31/13 | 17.39 | (0.05 | ) | 2.37 | 2.32 | — | 19.71 | 13.34 | 7,411 | 2.53 | 2.53 | (0.25 | ) | 148 | ||||||||||||||||||||||||||||||||||
Class C |
| |||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 28.45 | (0.17 | )(d) | 0.09 | (0.08 | ) | — | 28.37 | (0.28 | ) | 12,765 | 2.56 | (e) | 2.57 | (e) | (1.16 | )(d)(e) | 30 | ||||||||||||||||||||||||||||||
Year ended 10/31/17 | 21.52 | (0.13 | ) | 7.06 | 6.93 | — | 28.45 | 32.20 | 13,422 | 2.68 | 2.68 | (0.53 | ) | 56 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.39 | (0.00 | ) | 1.16 | 1.16 | (0.03 | ) | 21.52 | 5.73 | 11,879 | 2.68 | 2.68 | (0.01 | ) | 52 | |||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 19.32 | 0.02 | 1.05 | 1.07 | — | 20.39 | 5.54 | 13,922 | 2.63 | 2.63 | 0.10 | 130 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 19.68 | (0.18 | ) | (0.14 | ) | (0.32 | ) | (0.04 | ) | 19.32 | (1.62 | ) | 15,978 | 2.60 | 2.60 | (0.90 | ) | 124 | ||||||||||||||||||||||||||||||
Year ended 10/31/13 | 17.36 | (0.05 | ) | 2.37 | 2.32 | — | 19.68 | 13.36 | 21,366 | 2.53 | 2.53 | (0.25 | ) | 148 | ||||||||||||||||||||||||||||||||||
Class Y |
| |||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 29.44 | (0.02 | )(d) | 0.08 | 0.06 | (0.22 | ) | 29.28 | 0.22 | 11,718 | 1.56 | (e) | 1.57 | (e) | (0.16 | )(d)(e) | 30 | |||||||||||||||||||||||||||||||
Year ended 10/31/17 | 22.26 | 0.12 | 7.27 | 7.39 | (0.21 | ) | 29.44 | 33.53 | 11,444 | 1.68 | 1.68 | 0.47 | 56 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 21.14 | 0.21 | 1.19 | 1.40 | (0.28 | ) | 22.26 | 6.77 | 5,216 | 1.68 | 1.68 | 0.99 | 52 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 19.98 | 0.23 | 1.08 | 1.31 | (0.15 | ) | 21.14 | 6.62 | 3,449 | 1.63 | 1.63 | 1.10 | 130 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 20.36 | 0.02 | (0.13 | ) | (0.11 | ) | (0.27 | ) | 19.98 | (0.62 | ) | 4,494 | 1.60 | 1.60 | 0.10 | 124 | ||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 17.95 | 0.14 | 2.44 | 2.58 | (0.17 | ) | 20.36 | 14.43 | 4,531 | 1.53 | 1.53 | 0.75 | 148 | |||||||||||||||||||||||||||||||||||
Class R5 |
| |||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 29.46 | (0.00 | )(d) | 0.08 | 0.08 | (0.26 | ) | 29.28 | 0.29 | 72 | 1.42 | (e) | 1.42 | (e) | (0.02 | )(d)(e) | 30 | |||||||||||||||||||||||||||||||
Year ended 10/31/17 | 22.28 | 0.16 | 7.28 | 7.44 | (0.26 | ) | 29.46 | 33.80 | 72 | 1.50 | 1.50 | 0.65 | 56 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 21.17 | 0.25 | 1.19 | 1.44 | (0.33 | ) | 22.28 | 7.00 | 54 | 1.45 | 1.45 | 1.22 | 52 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 20.01 | 0.28 | 1.08 | 1.36 | (0.20 | ) | 21.17 | 6.88 | 75 | 1.41 | 1.41 | 1.32 | 130 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 20.38 | 0.06 | (0.14 | ) | (0.08 | ) | (0.29 | ) | 20.01 | (0.46 | ) | 104 | 1.39 | 1.39 | 0.31 | 124 | ||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 17.97 | 0.18 | 2.45 | 2.63 | (0.22 | ) | 20.38 | 14.71 | 411 | 1.33 | 1.33 | 0.95 | 148 | |||||||||||||||||||||||||||||||||||
Class R6 |
| |||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 29.45 | (0.00 | )(d) | 0.08 | 0.08 | (0.27 | ) | 29.26 | 0.28 | 743 | 1.42 | (e) | 1.42 | (e) | (0.02 | )(d)(e) | 30 | |||||||||||||||||||||||||||||||
Year ended 10/31/17(g) | 23.28 | 0.25 | 5.92 | 6.17 | — | 29.45 | 26.50 | 107 | 1.47 | (h) | 1.47 | (h) | 0.68 | (h) | 56 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets includes significant dividends received during the six months ended April 30, 2018. Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets excluding the significant dividends are $(0.25) and (1.04)%, $(0.27) and (1.79)%, $(0.36) and (1.79)%, $(0.21) and (0.79)%, $(0.19) and (0.65)% and $(0.19) and (0.65)% for Class A, Class B, Class C, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $74,226, $718, $13,531, $11,788, $74, and $508 for Class A, Class B, Class C, Class Y, Class R5 and Class R6 shares, respectively. |
(f) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(g) | Commencement date of April 4, 2017 for Class R6 shares. |
(h) | Annualized. |
15 Invesco Greater China Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | ACTUAL | HYPOTHETICAL (5% annual return before | Annualized Expense Ratio | |||||||||||||||||||||
Beginning Account Value (11/01/17) | Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | ||||||||||||||||||||
A | $ | 1,000.00 | $ | 1,000.80 | $ | 8.98 | $ | 1,015.82 | $ | 9.05 | 1.81 | % | ||||||||||||
C | 1,000.00 | 997.20 | 12.68 | 1,012.10 | 12.77 | 2.56 | ||||||||||||||||||
Y | 1,000.00 | 1,002.20 | 7.74 | 1,017.06 | 7.80 | 1.56 | ||||||||||||||||||
R5 | 1,000.00 | 1,002.90 | 7.05 | 1,017.75 | 7.10 | 1.42 | ||||||||||||||||||
R6 | 1,000.00 | 1,002.80 | 7.05 | 1,017.75 | 7.10 | 1.42 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
16 Invesco Greater China Fund
Explore High-Conviction Investing with Invesco
Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
∎ Quarterly statements
∎ Daily confirmations
∎ Tax forms
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. CHI-SAR-1 06082018 1257
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco Health Care Fund
| ||||
Effective April 30, 2018, Invesco Global Health Care Fund was renamed Invesco Health Care Fund.
| ||||
Nasdaq: | ||||
A: GGHCX ∎ C: GTHCX ∎ Y: GGHYX ∎ Investor: GTHIX ∎ R6: GGHSX |
| ||||
2
| Fund Performance
| |||
4
| Letters to Shareholders
| |||
5
| Schedule of Investments
| |||
7
| Financial Statements
| |||
9
| Notes to Financial Statements
| |||
16
| Financial Highlights
| |||
17
| Fund Expenses
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | -1.33 | % | ||
Class C Shares | -1.70 | |||
Class Y Shares | -1.20 | |||
Investor Class Shares | -1.33 | |||
Class R6 Shares | -1.20 | |||
MSCI World Index▼ (Broad Market Index) | 3.40 | |||
MSCI World Health Care Index▼ (Style-Specific Index) | 1.90 | |||
Lipper Global Health/Biotechnology Funds Index∎ (Peer Group Index) | 1.16 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
|
The MSCI World IndexSM is an unmanaged index considered representative of stocks of developed countries. The index is computed using the net return, which withholds applicable taxes for non-resident investors.
The MSCI World Health Care Index is an unmanaged index considered representative of health care stocks of developed countries. The index is computed using the net return, which withholds applicable taxes for non-resident investors.
The Lipper Global Health/Biotechnology Funds Index is an unmanaged index considered representative of global health/biotechnology funds tracked by Lipper.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Health Care Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
| ||||||
Class A Shares |
| |||||
Inception (8/7/89) | 10.23 | % | ||||
10 Years | 8.13 | |||||
5 Years | 6.94 | |||||
1 Year | -3.40 | |||||
Class C Shares |
| |||||
Inception (3/1/99) | 7.62 | % | ||||
10 Years | 7.93 | |||||
5 Years | 7.35 | |||||
1 Year | 0.52 | |||||
Class Y Shares |
| |||||
10 Years | 9.00 | % | ||||
5 Years | 8.42 | |||||
1 Year | 2.47 | |||||
Investor Class Shares |
| |||||
Inception (7/15/05) | 7.89 | % | ||||
10 Years | 8.75 | |||||
5 Years | 8.15 | |||||
1 Year | 2.21 | |||||
Class R6 Shares |
| |||||
10 Years | 8.78 | % | ||||
5 Years | 8.22 | |||||
1 Year | 2.50 |
Class Y shares incepted on October 3, 2008. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
Class R6 shares incepted on April 4, 2017. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (8/7/89) | 10.23 | % | ||||
10 Years | 8.23 | |||||
5 Years | 7.57 | |||||
1 Year | -2.44 | |||||
Class C Shares |
| |||||
Inception (3/1/99) | 7.61 | % | ||||
10 Years | 8.03 | |||||
5 Years | 7.97 | |||||
1 Year | 1.55 | |||||
Class Y Shares |
| |||||
10 Years | 9.10 | % | ||||
5 Years | 9.06 | |||||
1 Year | 3.48 | |||||
Investor Class Shares |
| |||||
Inception (7/15/05) | 7.87 | % | ||||
10 Years | 8.84 | |||||
5 Years | 8.78 | |||||
1 Year | 3.22 | |||||
Class R6 Shares |
| |||||
10 Years | 8.88 | % | ||||
5 Years | 8.85 | |||||
1 Year | 3.56 |
The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class Y, Investor Class and Class R6 shares was 1.12%, 1.87%, 0.87%, 1.12% and 0.80%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class Y, Investor Class and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
3 Invesco Health Care Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including performance, holdings and portfolio manager commentaries. You can access information about |
your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Health Care Fund
Schedule of Investments(a)
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–94.87% |
| |||||||
Biotechnology–23.94% | ||||||||
ACADIA Pharmaceuticals Inc.(b) | 181,196 | $ | 2,864,709 | |||||
Alexion Pharmaceuticals, Inc.(b) | 282,444 | 33,223,888 | ||||||
Amarin Corp. PLC–ADR (Ireland)(b) | 984,512 | 2,707,408 | ||||||
Array BioPharma Inc.(b) | 857,073 | 11,621,910 | ||||||
BioCryst Pharmaceuticals, Inc.(b) | 639,339 | 3,145,548 | ||||||
Biogen Inc.(b) | 106,364 | 29,101,190 | ||||||
BioMarin Pharmaceutical Inc.(b) | 383,269 | 32,006,794 | ||||||
bluebird bio, Inc.(b) | 58,211 | 9,904,602 | ||||||
Celgene Corp.(b) | 291,461 | 25,386,253 | ||||||
Clovis Oncology Inc.(b) | 234,518 | 10,173,391 | ||||||
DBV Technologies S.A.–ADR (France)(b) | 626,020 | 13,741,139 | ||||||
Exact Sciences Corp.(b) | 259,028 | 12,953,990 | ||||||
Heron Therapeutics, Inc.(b) | 308,054 | 9,334,036 | ||||||
Incyte Corp.(b) | 144,139 | 8,927,970 | ||||||
Loxo Oncology, Inc.(b) | 54,666 | 6,882,996 | ||||||
Momenta Pharmaceuticals, Inc.(b) | 385,306 | 8,014,365 | ||||||
Neurocrine Biosciences, Inc.(b) | 129,531 | 10,502,373 | ||||||
REGENXBIO Inc.(b) | 168,086 | 6,278,012 | ||||||
Sarepta Therapeutics, Inc.(b) | 124,594 | 9,513,998 | ||||||
Seattle Genetics, Inc.(b) | 187,024 | 9,573,758 | ||||||
Shire PLC–ADR | 157,662 | 25,136,053 | ||||||
TESARO, Inc.(b) | 113,910 | 5,799,158 | ||||||
Vertex Pharmaceuticals Inc.(b) | 160,932 | 24,648,345 | ||||||
311,441,886 | ||||||||
Drug Retail–0.50% | ||||||||
Raia Drogasil S.A. (Brazil) | 331,578 | 6,503,793 | ||||||
Health Care Equipment–15.06% | ||||||||
Abbott Laboratories | 277,510 | 16,131,656 | ||||||
Baxter International Inc. | 312,834 | 21,741,963 | ||||||
Boston Scientific Corp.(b) | 831,578 | 23,882,920 | ||||||
Edwards Lifesciences Corp.(b) | 121,302 | 15,449,023 | ||||||
Koninklijke Philips N.V. (Netherlands) | 406,717 | 17,170,853 | ||||||
Medtronic PLC | 255,602 | 20,481,388 | ||||||
Olympus Corp. (Japan) | 356,600 | 13,286,039 | ||||||
Siemens Healthineers AG–REGS (Germany)(b)(c) | 220,324 | 8,590,564 | ||||||
Wright Medical Group N.V.(b) | 879,249 | 17,242,073 | ||||||
Zimmer Biomet Holdings, Inc. | 363,570 | 41,872,357 | ||||||
195,848,836 | ||||||||
Health Care Facilities–1.21% | ||||||||
HCA Healthcare, Inc. | 164,633 | 15,761,963 | ||||||
Health Care Services–0.75% | ||||||||
Envision Healthcare Corp.(b) | 261,736 | 9,728,727 |
Shares | Value | |||||||
Health Care Supplies–3.12% | ||||||||
Align Technology, Inc.(b) | 56,890 | $ | 14,213,966 | |||||
DENTSPLY SIRONA Inc. | 525,126 | 26,434,843 | ||||||
40,648,809 | ||||||||
Health Care Technology–0.51% | ||||||||
HMS Holdings Corp.(b) | 365,977 | 6,591,246 | ||||||
Life Sciences Tools & Services–7.06% | ||||||||
Agilent Technologies, Inc. | 110,427 | 7,259,471 | ||||||
Eurofins Scientific S.E. (Luxembourg) | 25,957 | 13,959,340 | ||||||
Illumina, Inc.(b) | 66,786 | 16,090,751 | ||||||
Thermo Fisher Scientific, Inc. | 259,406 | 54,566,052 | ||||||
91,875,614 | ||||||||
Managed Health Care–14.67% | ||||||||
Anthem, Inc. | 110,623 | 26,105,922 | ||||||
Centene Corp.(b) | 203,348 | 22,079,526 | ||||||
Cigna Corp. | 69,760 | 11,986,163 | ||||||
Hapvida Participacoes e Investimentos S.A.–REGS (Brazil)(b)(c) | 1,026,700 | 8,102,827 | ||||||
HealthEquity, Inc.(b) | 148,938 | 9,780,758 | ||||||
Humana Inc. | 136,210 | 40,070,258 | ||||||
Molina Healthcare Inc.(b) | 41,112 | 3,422,574 | ||||||
Notre Dame Intermedica Participacoes S.A. (Brazil)(b) | 1,026,461 | 5,959,246 | ||||||
Qualicorp S.A. (Brazil) | 667,900 | 4,622,970 | ||||||
UnitedHealth Group Inc. | 248,448 | 58,733,107 | ||||||
190,863,351 | ||||||||
Pharmaceuticals–27.92% | ||||||||
Aclaris Therapeutics, Inc.(b) | 391,396 | 6,947,279 | ||||||
Aerie Pharmaceuticals, Inc.(b) | 184,846 | 9,464,115 | ||||||
Allergan PLC | 119,368 | 18,340,893 | ||||||
Assembly Biosciences, Inc.(b) | 58,770 | 2,555,319 | ||||||
AstraZeneca PLC–ADR (United Kingdom) | 1,196,873 | 42,524,898 | ||||||
Bayer AG (Germany) | 284,484 | 34,058,290 | ||||||
Bristol-Myers Squibb Co. | 356,583 | 18,588,672 | ||||||
Dermira, Inc.(b) | 355,028 | 3,234,305 | ||||||
Eli Lilly and Co. | 512,367 | 41,537,593 | ||||||
Jazz Pharmaceuticals PLC(b) | 70,872 | 10,775,379 | ||||||
Merck & Co., Inc. | 561,618 | 33,062,451 | ||||||
Nippon Shinyaku Co., Ltd. (Japan) | 199,000 | 14,816,500 | ||||||
Novartis AG–ADR (Switzerland) | 688,804 | 52,824,379 | ||||||
Novo Nordisk A/S–Class B (Denmark) | 639,217 | 30,011,277 | ||||||
Odonate Therapeutics, Inc.(b) | 280,651 | 5,916,123 | ||||||
Roche Holding AG (Switzerland) | 86,253 | 19,136,243 | ||||||
Supernus Pharmaceuticals Inc.(b) | 214,823 | 10,075,199 | ||||||
Zogenix, Inc.(b) | 237,270 | 9,324,711 | ||||||
363,193,626 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Health Care Fund
Shares | Value | |||||||
Systems Software–0.13% | ||||||||
Ping An Healthcare and Technology Co. Ltd.–REGS (China)(b)(c) | 246,400 | $ | 1,720,399 | |||||
Total Common Stocks & Other Equity Interests |
| 1,234,178,250 | ||||||
Preferred Stock–0.00% | ||||||||
Health Care Equipment–0.00% | ||||||||
Intact Medical Corp., Series C, 3.33% Pfd. (Acquired 03/26/2001; | 2,439,026 | 0 | ||||||
Money Market Funds–5.58% |
| |||||||
Invesco Government & Agency Portfolio–Institutional | 25,400,929 | 25,400,929 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(f) | 18,139,755 | 18,141,569 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(f) | 29,029,634 | 29,029,634 | ||||||
Total Money Market Funds |
| 72,572,132 | ||||||
TOTAL INVESTMENTS IN SECURITIES–100.45% |
| 1,306,750,382 | ||||||
OTHER ASSETS LESS LIABILITIES–(0.45)% |
| (5,882,939 | ) | |||||
NET ASSETS–100.00% |
| $ | 1,300,867,443 |
Investment Abbreviations:
ADR | – American Depositary Receipt | |
Pfd. | – Preferred | |
REGS | – Regulation S |
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2018 was $18,413,790, which represented 1.42% of the Fund’s Net Assets. |
(d) | Security is considered venture capital. See Note 1K. |
(e) | Security valued using significant unobservable inputs (Level 3). See Note 3. |
(f) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2018
Health Care | 94.3 | % | ||
Consumer Staples | 0.5 | |||
Information Technology | 0.1 | |||
Money Market Funds Plus Other Assets Less Liabilities | 5.1 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Health Care Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $938,348,496) | $ | 1,234,178,250 | ||
Investments in affiliated money market funds, at value (Cost $72,570,600) | 72,572,132 | |||
Foreign currencies, at value (Cost $1,004) | 694 | |||
Receivable for: | ||||
Investments sold | 3,120,322 | |||
Fund shares sold | 240,007 | |||
Dividends | 1,877,728 | |||
Investment for trustee deferred compensation and retirement plans | 287,928 | |||
Other assets | 144,371 | |||
Total assets | 1,312,421,432 | |||
Liabilities: |
| |||
Payable for: | ||||
Investments purchased | 1,892,013 | |||
Fund shares reacquired | 811,593 | |||
Amount due custodian | 7,667,730 | |||
Accrued fees to affiliates | 684,767 | |||
Accrued trustees’ and officers’ fees and benefits | 2,606 | |||
Accrued other operating expenses | 124,357 | |||
Trustee deferred compensation and retirement plans | 370,923 | |||
Total liabilities | 11,553,989 | |||
Net assets applicable to shares outstanding | $ | 1,300,867,443 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 916,174,345 | ||
Undistributed net investment income (loss) | (2,582,986 | ) | ||
Undistributed net realized gain | 91,449,344 | |||
Net unrealized appreciation | 295,826,740 | |||
$ | 1,300,867,443 |
Net Assets: |
| |||
Class A | $ | 662,288,298 | ||
Class C | $ | 47,942,715 | ||
Class Y | $ | 32,486,325 | ||
Investor Class | $ | 558,110,700 | ||
Class R6 | $ | 39,405 | ||
Shares outstanding, no par value, |
| |||
Class A | 18,960,640 | |||
Class C | 1,977,784 | |||
Class Y | 912,604 | |||
Investor Class | 15,975,298 | |||
Class R6 | 1,106 | |||
Class A: | ||||
Net asset value per share | $ | 34.93 | ||
Maximum offering price per share | ||||
(Net asset value of $34.93 ¸ 94.50%) | $ | 36.96 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 24.24 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 35.60 | ||
Investor Class: | ||||
Net asset value and offering price per share | $ | 34.94 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 35.63 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Health Care Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of foreign withholding taxes of $917,755) | $ | 7,012,791 | ||
Dividends from affiliated money market funds | 295,187 | |||
Total investment income | 7,307,978 | |||
Expenses: | ||||
Advisory fees | 4,248,111 | |||
Administrative services fees | 166,984 | |||
Custodian fees | 69,164 | |||
Distribution fees: | ||||
Class A | 863,108 | |||
Class B | 4,559 | |||
Class C | 260,961 | |||
Investor Class | 721,452 | |||
Transfer agent fees — A, B, C, Y and Investor Class | 1,010,444 | |||
Transfer agent fees — R6 | 12 | |||
Trustees’ and officers’ fees and benefits | 21,136 | |||
Registration and filing fees | 55,080 | |||
Reports to shareholders | 75,974 | |||
Professional services fees | 69,194 | |||
Other | 28,216 | |||
Total expenses | 7,594,395 | |||
Less: Fees waived and expense offset arrangement(s) | (49,599 | ) | ||
Net expenses | 7,544,796 | |||
Net investment income (loss) | (236,818 | ) | ||
Realized and unrealized gain (loss) from: | ||||
Net realized gain from: | ||||
Investment securities | 92,023,202 | |||
Foreign currencies | 25,895 | |||
92,049,097 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | (109,057,950 | ) | ||
Foreign currencies | 39,925 | |||
(109,018,025 | ) | |||
Net realized and unrealized gain (loss) | (16,968,928 | ) | ||
Net increase (decrease) in net assets resulting from operations | $ | (17,205,746 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Health Care Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income (loss) | $ | (236,818 | ) | $ | (2,102,543 | ) | ||
Net realized gain | 92,049,097 | 91,355,823 | ||||||
Change in net unrealized appreciation (depreciation) | (109,018,025 | ) | 141,437,481 | |||||
Net increase (decrease) in net assets resulting from operations | (17,205,746 | ) | 230,690,761 | |||||
Distributions to shareholders from net investment income: | ||||||||
Class A | — | (1,607,275 | ) | |||||
Class Y | — | (118,323 | ) | |||||
Investor Class | — | (1,255,558 | ) | |||||
Total distributions from net investment income | — | (2,981,156 | ) | |||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | (45,906,720 | ) | (15,823,825 | ) | ||||
Class B | (174,565 | ) | (135,902 | ) | ||||
Class C | (4,951,203 | ) | (1,930,498 | ) | ||||
Class Y | (2,282,310 | ) | (507,868 | ) | ||||
Investor Class | (38,238,241 | ) | (12,361,129 | ) | ||||
Class R6 | (873 | ) | — | |||||
Total distributions from net realized gains | (91,553,912 | ) | (30,759,222 | ) | ||||
Share transactions–net: | ||||||||
Class A | (5,557,798 | ) | (105,311,767 | ) | ||||
Class B | (2,032,988 | ) | (3,051,588 | ) | ||||
Class C | (3,044,632 | ) | (17,796,792 | ) | ||||
Class Y | (803,089 | ) | 9,660,440 | |||||
Investor Class | 7,838,367 | (49,623,544 | ) | |||||
Class R6 | 26,752 | 13,272 | ||||||
Net increase (decrease) in net assets resulting from share transactions | (3,573,388 | ) | (166,109,979 | ) | ||||
Net increase (decrease) in net assets | (112,333,046 | ) | 30,840,404 | |||||
Net assets: | ||||||||
Beginning of period | 1,413,200,489 | 1,382,360,085 | ||||||
End of period (includes undistributed net investment income (loss) of $(2,582,986) and $(2,346,168), respectively) | $ | 1,300,867,443 | $ | 1,413,200,489 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Health Care Fund, formerly Invesco Global Health Care Fund, (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of five different classes of shares: Class A, Class C, Class Y, Investor Class and Class R6. Class Y and Investor Class shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class Y and Investor Class shares are sold at net asset value. Effective November 30, 2010, new or additional investments in Class B shares are no longer permitted. Existing shareholders of Class B shares were permitted to continue to reinvest dividends and capital gains distributions in Class B shares until their conversion to Class A shares. Also, shareholders in Class B shares were able to exchange those shares for Class B shares of other Invesco Funds offering such shares until they converted to Class A shares. Generally, Class B shares automatically converted to Class A shares on or
9 Invesco Health Care Fund
about the month-end, which was at least eight years after the date of purchase. Redemptions of Class B shares prior to the conversion date were subject to a CDSC. Effective January 26, 2018, all of the Fund’s outstanding Class B shares were converted to Class A shares, in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net
10 Invesco Health Care Fund
realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R6 are charged to such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
J. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
11 Invesco Health Care Fund
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
K. | Other Risks — The Fund’s performance is vulnerable to factors affecting the health care industry, including government regulation, obsolescence caused by scientific advances and technological innovations. |
The Fund has invested in non-publicly traded companies, some of which are in the startup or development stages. These investments are inherently risky, as the market for the technologies or products these companies are developing are typically in the early stages and may never materialize. The Fund could lose its entire investment in these companies. These investments are valued at fair value as determined in good faith in accordance with procedures approved by the Board of Trustees. Investments in privately held venture capital securities are illiquid.
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||||||
First $350 million | 0 | .75% | ||||||
Next $350 million | 0 | .65% | ||||||
Next $1.3 billion | 0 | .55% | ||||||
Next $2 billion | 0 | .45% | ||||||
Next $2 billion | 0 | .40% | ||||||
Next $2 billion | 0 | .375% | ||||||
Over $8 billion | 0 | .35% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.63%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class Y, Investor Class and Class R6 shares to 2.00%, 2.75%, 1.75%, 2.00% and 1.75% of average daily net assets (the “expense limits”), respectively. Prior to their conversion to Class A shares, the expense limit for Class B shares was 2.75% of average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $28,215.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, the expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class Y, Investor Class and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Investor Class shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.25% of the
12 Invesco Health Care Fund
average daily net assets of Investor Class shares. Prior to their conversion to Class A shares, the Fund paid an annual rate of 1.00% of the average daily net assets of Class B shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plan are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $35,171 in front-end sales commissions from the sale of Class A shares and $427 and $602 from Class A and Class C shares, respectively, for CDSC imposed on redemptions by shareholders.
For the six months ended April 30, 2018, the Fund incurred $7,069 in brokerage commissions with Invesco Capital Markets, Inc., an affiliate of the Adviser and IDI, for portfolio transactions executed on behalf of the Fund.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Common Stocks & Other Equity Interests | $ | 1,090,019,309 | $ | 144,158,941 | $ | — | $ | 1,234,178,250 | ||||||||
Preferred Stock | — | — | 0 | 0 | ||||||||||||
Money Market Funds | 72,572,132 | — | — | 72,572,132 | ||||||||||||
Total Investments | $ | 1,162,591,441 | $ | 144,158,941 | $ | 0 | $ | 1,306,750,382 |
NOTE 4—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $21,384.
NOTE 5—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
13 Invesco Health Care Fund
NOTE 6—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 7—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2017.
NOTE 8—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $228,411,065 and $347,831,612, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 354,806,976 | ||
Aggregate unrealized (depreciation) of investments | (59,441,343 | ) | ||
Net unrealized appreciation of investments | $ | 295,365,633 |
Cost of investments for tax purposes is $1,011,384,749.
14 Invesco Health Care Fund
NOTE 9—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 427,597 | $ | 15,626,392 | 1,046,320 | $ | 37,489,570 | ||||||||||
Class B(b) | 494 | 13,144 | 6,634 | 167,650 | ||||||||||||
Class C | 74,855 | 1,900,342 | 310,753 | 8,133,539 | ||||||||||||
Class Y | 162,343 | 5,930,679 | 640,928 | 23,573,301 | ||||||||||||
Investor Class | 101,649 | 3,677,800 | 183,690 | 6,634,297 | ||||||||||||
Class R6(c) | 783 | 27,981 | 357 | 13,272 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 1,203,273 | 42,764,308 | 512,170 | 16,973,305 | ||||||||||||
Class B(b) | 6,763 | 166,983 | 5,664 | 135,083 | ||||||||||||
Class C | 191,734 | 4,743,503 | 79,740 | 1,904,968 | ||||||||||||
Class Y | 52,405 | 1,896,535 | 16,752 | 563,212 | ||||||||||||
Investor Class | 1,022,012 | 36,332,522 | 396,403 | 13,140,754 | ||||||||||||
Class R6 | 5 | 199 | — | — | ||||||||||||
Conversion of Class B shares to Class A shares:(d) | ||||||||||||||||
Class A | 3,710 | 141,604 | 66,739 | 2,401,525 | ||||||||||||
Class B | (5,473 | ) | (141,604 | ) | (92,917 | ) | (2,401,525 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (1,773,175 | ) | (64,090,102 | ) | (4,546,739 | ) | (162,176,167 | ) | ||||||||
Class B(b) | (78,556 | ) | (2,071,511 | ) | (37,363 | ) | (952,796 | ) | ||||||||
Class C | (382,634 | ) | (9,688,477 | ) | (1,086,586 | ) | (27,835,299 | ) | ||||||||
Class Y | (235,899 | ) | (8,630,303 | ) | (397,427 | ) | (14,476,073 | ) | ||||||||
Investor Class | (890,259 | ) | (32,171,955 | ) | (1,944,467 | ) | (69,398,595 | ) | ||||||||
Class R6 | (39 | ) | (1,428 | ) | — | — | ||||||||||
Net increase (decrease) in share activity | (118,412 | ) | $ | (3,573,388 | ) | (4,839,349 | ) | $ | (166,109,979 | ) |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 13% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
(b) | Class B shares activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(c) | Commencement date of April 4, 2017. |
(d) | Effective as of the close of business January 26, 2018, all outstanding Class B shares were converted to Class A shares. |
15 Invesco Health Care Fund
NOTE 10—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 37.84 | $ | (0.00 | ) | $ | (0.46 | ) | $ | (0.46 | ) | $ | — | $ | (2.45 | ) | $ | (2.45 | ) | $ | 34.93 | (1.33 | )% | $ | 662,288 | 1.09 | %(d) | 1.09 | %(d) | (0.01 | )%(d) | 17 | % | |||||||||||||||||||||||
Year ended 10/31/17 | 32.93 | (0.05 | ) | 5.77 | 5.72 | (0.07 | ) | (0.74 | ) | (0.81 | ) | 37.84 | 17.73 | 722,643 | 1.12 | 1.12 | (0.12 | ) | 36 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 43.70 | 0.08 | (5.09 | ) | (5.01 | ) | — | (5.76 | ) | (5.76 | ) | 32.93 | (12.87 | ) | 725,053 | 1.09 | 1.09 | 0.23 | 21 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 47.08 | 0.02 | 1.53 | 1.55 | — | (4.93 | ) | (4.93 | ) | 43.70 | 3.56 | 981,963 | 1.04 | 1.05 | 0.04 | 47 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 40.38 | 0.01 | 10.15 | 10.16 | (0.01 | ) | (3.45 | ) | (3.46 | ) | 47.08 | 27.20 | 906,858 | 1.07 | 1.08 | 0.04 | 24 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 32.09 | 0.07 | 10.63 | 10.70 | (0.17 | ) | (2.24 | ) | (2.41 | ) | 40.38 | 35.79 | 737,071 | 1.10 | 1.11 | 0.21 | 37 | |||||||||||||||||||||||||||||||||||||||
Class B | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18(e) | 27.06 | (0.05 | ) | 1.93 | 1.88 | — | (2.45 | ) | (2.45 | ) | 26.49 | 7.60 | — | 1.84 | (d) | 1.84 | (d) | (0.76 | )(d) | 17 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 23.87 | (0.22 | ) | 4.15 | 3.93 | — | (0.74 | ) | (0.74 | ) | 27.06 | 16.87 | 2,077 | 1.87 | 1.87 | (0.87 | ) | 36 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 33.51 | (0.14 | ) | (3.74 | ) | (3.88 | ) | — | (5.76 | ) | (5.76 | ) | 23.87 | (13.52 | ) | 4,649 | 1.84 | 1.84 | (0.52 | ) | 21 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 37.50 | (0.25 | ) | 1.19 | 0.94 | — | (4.93 | ) | (4.93 | ) | 33.51 | 2.76 | 11,262 | 1.79 | 1.80 | (0.71 | ) | 47 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 33.06 | (0.24 | ) | 8.13 | 7.89 | — | (3.45 | ) | (3.45 | ) | 37.50 | 26.26 | 14,239 | 1.82 | 1.83 | (0.71 | ) | 24 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 26.72 | (0.16 | ) | 8.74 | 8.58 | — | (2.24 | ) | (2.24 | ) | 33.06 | 34.81 | 17,101 | 1.85 | 1.86 | (0.54 | ) | 37 | ||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 27.10 | (0.10 | ) | (0.31 | ) | (0.41 | ) | — | (2.45 | ) | (2.45 | ) | 24.24 | (1.70 | ) | 47,943 | 1.84 | (d) | 1.84 | (d) | (0.76 | )(d) | 17 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 23.91 | (0.22 | ) | 4.15 | 3.93 | — | (0.74 | ) | (0.74 | ) | 27.10 | 16.84 | 56,741 | 1.87 | 1.87 | (0.87 | ) | 36 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 33.56 | (0.14 | ) | (3.75 | ) | (3.89 | ) | — | (5.76 | ) | (5.76 | ) | 23.91 | (13.53 | ) | 66,699 | 1.84 | 1.84 | (0.52 | ) | 21 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 37.54 | (0.25 | ) | 1.20 | 0.95 | — | (4.93 | ) | (4.93 | ) | 33.56 | 2.78 | 107,976 | 1.79 | 1.80 | (0.71 | ) | 47 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 33.09 | (0.24 | ) | 8.14 | 7.90 | — | (3.45 | ) | (3.45 | ) | 37.54 | 26.26 | 81,439 | 1.82 | 1.83 | (0.71 | ) | 24 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 26.75 | (0.16 | ) | 8.74 | 8.58 | — | (2.24 | ) | (2.24 | ) | 33.09 | 34.76 | 57,536 | 1.85 | 1.86 | (0.54 | ) | 37 | ||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 38.47 | 0.04 | (0.46 | ) | (0.42 | ) | — | (2.45 | ) | (2.45 | ) | 35.60 | (1.20 | ) | 32,486 | 0.84 | (d) | 0.84 | (d) | 0.24 | (d) | 17 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 33.48 | 0.05 | 5.85 | 5.90 | (0.17 | ) | (0.74 | ) | (0.91 | ) | 38.47 | 18.01 | 35,924 | 0.87 | 0.87 | 0.13 | 36 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 44.24 | 0.17 | (5.17 | ) | (5.00 | ) | — | (5.76 | ) | (5.76 | ) | 33.48 | (12.67 | ) | 22,548 | 0.84 | 0.84 | 0.48 | 21 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 47.51 | 0.14 | 1.53 | 1.67 | (0.01 | ) | (4.93 | ) | (4.94 | ) | 44.24 | 3.82 | 39,443 | 0.79 | 0.80 | 0.29 | 47 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 40.71 | 0.13 | 10.22 | 10.35 | (0.10 | ) | (3.45 | ) | (3.55 | ) | 47.51 | 27.52 | 31,016 | 0.82 | 0.83 | 0.29 | 24 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 32.34 | 0.16 | 10.70 | 10.86 | (0.25 | ) | (2.24 | ) | (2.49 | ) | 40.71 | 36.10 | 15,502 | 0.85 | 0.86 | 0.46 | 37 | |||||||||||||||||||||||||||||||||||||||
Investor Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 37.85 | (0.00 | ) | (0.46 | ) | (0.46 | ) | — | (2.45 | ) | (2.45 | ) | 34.94 | (1.33 | ) | 558,111 | 1.09 | (d) | 1.09 | (d) | (0.01 | )(d) | 17 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 32.94 | (0.04 | ) | 5.76 | 5.72 | (0.07 | ) | (0.74 | ) | (0.81 | ) | 37.85 | 17.72 | 595,801 | 1.12 | 1.12 | (0.12 | ) | 36 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 43.71 | 0.08 | (5.09 | ) | (5.01 | ) | — | (5.76 | ) | (5.76 | ) | 32.94 | (12.87 | ) | 563,411 | 1.09 | 1.09 | 0.23 | 21 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 47.09 | 0.02 | 1.53 | 1.55 | — | (4.93 | ) | (4.93 | ) | 43.71 | 3.57 | 714,351 | 1.04 | 1.05 | 0.04 | 47 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 40.39 | 0.01 | 10.15 | 10.16 | (0.01 | ) | (3.45 | ) | (3.46 | ) | 47.09 | 27.19 | 730,280 | 1.07 | 1.08 | 0.04 | 24 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 32.10 | 0.07 | 10.63 | 10.70 | (0.17 | ) | (2.24 | ) | (2.41 | ) | 40.39 | 35.78 | 607,408 | 1.10 | 1.11 | 0.21 | 37 | |||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 38.49 | 0.05 | (0.46 | ) | (0.41 | ) | — | (2.45 | ) | (2.45 | ) | 35.63 | (1.17 | ) | 39 | 0.80 | (d) | 0.80 | (d) | 0.28 | (d) | 17 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/17(f) | 36.35 | 0.05 | 2.09 | 2.14 | — | — | — | 38.49 | 5.89 | 14 | 0.78 | (g) | 0.78 | (g) | 0.22 | (g) | 36 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $696,203, $1,915, $52,625, $34,943, $581,945 and $24 for Class A, Class B, Class C, Class Y, Investor Class and Class R6 shares, respectively. |
(e) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(f) | Commencement date of April 4, 2017 for Class R6 shares. |
(g) | Annualized. |
16 Invesco Health Care Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 986.70 | $ | 5.37 | $ | 1,019.39 | $ | 5.46 | 1.09 | % | ||||||||||||
C | 1,000.00 | 983.00 | 9.05 | 1,015.67 | 9.20 | 1.84 | ||||||||||||||||||
Y | 1,000.00 | 988.00 | 4.14 | 1,020.63 | 4.21 | 0.84 | ||||||||||||||||||
Investor | 1,000.00 | 986.70 | 5.37 | 1,019.39 | 5.46 | 1.09 | ||||||||||||||||||
R6 | 1,000.00 | 988.00 | 3.94 | 1,020.83 | 4.01 | 0.80 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
17 Invesco Health Care Fund
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Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. GHC-SAR-1 06122018 0908
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco Long/Short Equity Fund
| ||||
Nasdaq: | ||||
A: LSQAX ∎ C: LSQCX ∎ R: LSQRX ∎ Y: LSQYX ∎ R5: LSQFX ∎ R6: LSQSX |
| ||||
2
| Fund Performance
| |||
4
| Letters to Shareholders
| |||
5
| Schedule of Investments
| |||
13
| Financial Statements
| |||
15
| Notes to Financial Statements
| |||
22
| Financial Highlights
| |||
23
| Fund Expenses
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 2.72 | % | ||
Class C Shares | 2.34 | |||
Class R Shares | 2.51 | |||
Class Y Shares | 2.81 | |||
Class R5 Shares | 2.91 | |||
Class R6 Shares | 2.84 | |||
S&P 500 Index▼ (Broad Market Index) | 3.82 | |||
FTSE US 3-Month Treasury Bill Index▼ (Style-Specific Index) | 0.67 | |||
Lipper Alternative Long/Short Equity Funds Index∎ (Peer Group Index) | 1.32 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
| |||
The S&P 500® Index is an unmanaged index considered representative of the US stock market. The FTSE US 3-Month Treasury Bill Index is an unmanaged index representative of three-month US Treasury bills. The Lipper Alternative Long/Short Equity Funds Index is an unmanaged index considered representative of alternative long/short equity funds tracked by Lipper. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Long/Short Equity Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
| ||||||
Class A Shares |
| |||||
Inception (12/19/13) | 7.25 | % | ||||
1 Year | 9.28 | |||||
Class C Shares |
| |||||
Inception (12/19/13) | 7.85 | % | ||||
1 Year | 13.85 | |||||
Class R Shares |
| |||||
Inception (12/19/13) | 8.38 | % | ||||
1 Year | 15.32 | |||||
Class Y Shares |
| |||||
Inception (12/19/13) | 8.92 | % | ||||
1 Year | 15.94 | |||||
Class R5 Shares |
| |||||
Inception (12/19/13) | 8.97 | % | ||||
1 Year | 16.04 | |||||
Class R6 Shares |
| |||||
Inception (12/19/13) | 8.97 | % | ||||
1 Year | 16.04 |
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.55%, 2.30%, 1.80%, 1.30%, 1.18% and 1.18%, respectively.1 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.56%, 2.31%, 1.81%, 1.31%, 1.19% and 1.19%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (12/19/13) | 7.29 | % | ||||
1 Year | 6.24 | |||||
Class C Shares |
| |||||
Inception (12/19/13) | 7.89 | % | ||||
1 Year | 10.64 | |||||
Class R Shares |
| |||||
Inception (12/19/13) | 8.43 | % | ||||
1 Year | 12.11 | |||||
Class Y Shares |
| |||||
Inception (12/19/13) | 8.99 | % | ||||
1 Year | 12.76 | |||||
Class R5 Shares |
| |||||
Inception (12/19/13) | 9.01 | % | ||||
1 Year | 12.86 | |||||
Class R6 Shares |
| |||||
Inception (12/19/13) | 9.01 | % | ||||
1 Year | 12.86 |
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 class shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco Long/Short Equity Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, |
including performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Long/Short Equity Fund
Schedule of Investments(a)
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–91.50% |
| |||||||
Advertising–1.51% | ||||||||
Interpublic Group of Cos., Inc. (The) | 51,300 | $ | 1,210,167 | |||||
Aerospace & Defense–1.35% | ||||||||
Spirit AeroSystems Holdings, Inc.–Class A | 13,400 | 1,076,958 | ||||||
Apparel Retail–1.64% | ||||||||
Gap, Inc. (The) | 44,850 | 1,311,414 | ||||||
Apparel, Accessories & Luxury Goods–3.34% | ||||||||
Michael Kors Holdings Ltd.(b) | 19,550 | 1,337,611 | ||||||
Ralph Lauren Corp. | 12,150 | 1,334,677 | ||||||
2,672,288 | ||||||||
Application Software–1.34% | ||||||||
ANSYS, Inc. | 6,650 | 1,075,039 | ||||||
Asset Management & Custody Banks–1.51% | ||||||||
T. Rowe Price Group Inc. | 10,600 | 1,206,492 | ||||||
Auto Parts & Equipment–1.55% | ||||||||
BorgWarner, Inc.(b) | 25,300 | 1,238,182 | ||||||
Biotechnology–3.35% | ||||||||
United Therapeutics Corp. | 11,050 | 1,216,715 | ||||||
Vertex Pharmaceuticals Inc. | 9,550 | 1,462,678 | ||||||
2,679,393 | ||||||||
Building Products–0.11% | ||||||||
Owens Corning | 1,400 | 91,686 | ||||||
Cable & Satellite–1.36% | ||||||||
GCI Liberty, Inc.–Class A | 20,250 | 903,150 | ||||||
Liberty Global PLC–Class C (United Kingdom)(b) | 6,300 | 183,330 | ||||||
1,086,480 | ||||||||
Commodity Chemicals–1.58% | ||||||||
Westlake Chemical Corp. | 11,850 | 1,267,595 | ||||||
Communications Equipment–3.48% | ||||||||
F5 Networks, Inc. | 9,250 | 1,508,582 | ||||||
Motorola Solutions, Inc. | 11,600 | 1,274,028 | ||||||
2,782,610 | ||||||||
Construction Machinery & Heavy Trucks–2.51% | ||||||||
Allison Transmission Holdings, Inc. | 34,200 | 1,333,458 | ||||||
Cummins Inc.(b) | 4,200 | 671,412 | ||||||
2,004,870 | ||||||||
Consumer Finance–1.68% | ||||||||
Ally Financial Inc. | 51,350 | 1,340,235 | ||||||
Copper–0.09% | ||||||||
Freeport-McMoRan Inc. | 4,700 | 71,487 |
Shares | Value | |||||||
Data Processing & Outsourced Services–1.89% | ||||||||
Broadridge Financial Solutions, Inc.(b) | 8,750 | $ | 938,087 | |||||
Total System Services, Inc. | 6,800 | 571,608 | ||||||
1,509,695 | ||||||||
Department Stores–3.83% | ||||||||
Kohl’s Corp. | 24,250 | 1,506,410 | ||||||
Macy’s, Inc. | 50,100 | 1,556,607 | ||||||
3,063,017 | ||||||||
Diversified Chemicals–3.05% | ||||||||
Eastman Chemical Co. | 12,150 | 1,240,272 | ||||||
Huntsman Corp. | 40,200 | 1,196,754 | ||||||
2,437,026 | ||||||||
Diversified Metals & Mining–1.74% | ||||||||
Teck Resources Ltd.–Class B (Canada) | 55,450 | 1,393,459 | ||||||
Diversified Support Services–0.82% | ||||||||
KAR Auction Services, Inc. | 12,550 | 652,475 | ||||||
Electric Utilities–1.57% | ||||||||
Entergy Corp. | 15,370 | 1,254,038 | ||||||
Electrical Components & Equipment–1.37% | ||||||||
AMETEK, Inc. | 15,700 | 1,095,860 | ||||||
Fertilizers & Agricultural Chemicals–1.47% | ||||||||
CF Industries Holdings, Inc. | 30,300 | 1,175,640 | ||||||
Food Distributors–1.50% | ||||||||
US Foods Holding Corp.(b) | 35,100 | 1,199,718 | ||||||
Gold–0.25% | ||||||||
Newmont Mining Corp. | 5,150 | 202,344 | ||||||
Health Care Equipment–0.97% | ||||||||
Varian Medical Systems, Inc. | 6,700 | 774,453 | ||||||
Health Care Services–1.06% | ||||||||
Laboratory Corp. of America Holdings(b) | 4,950 | 845,213 | ||||||
Homebuilding–3.31% | ||||||||
NVR, Inc. | 440 | 1,364,000 | ||||||
Toll Brothers, Inc. | 30,450 | 1,283,772 | ||||||
2,647,772 | ||||||||
Hotel & Resort REITs–1.44% | ||||||||
Host Hotels & Resorts Inc.(b) | 59,100 | 1,155,996 | ||||||
Hotels, Resorts & Cruise Lines–1.51% | ||||||||
Hyatt Hotels Corp.–Class A | 15,700 | 1,206,859 | ||||||
Independent Power Producers & Energy Traders–1.97% | ||||||||
NRG Energy, Inc. | 50,900 | 1,577,900 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Long/Short Equity Fund
Shares | Value | |||||||
Internet & Direct Marketing Retail–1.51% | ||||||||
Qurate Retail Group, Inc.–Class A | 51,550 | $ | 1,206,786 | |||||
Internet Software & Services–4.21% | ||||||||
Akamai Technologies, Inc.(b) | 13,050 | 935,032 | ||||||
IAC/InterActiveCorp.(b) | 5,700 | 924,198 | ||||||
VeriSign, Inc. | 12,850 | 1,508,847 | ||||||
3,368,077 | ||||||||
IT Consulting & Other Services–0.06% | ||||||||
Teradata Corp. | 1,200 | 49,104 | ||||||
Life & Health Insurance–2.72% | ||||||||
Lincoln National Corp. | 16,350 | 1,154,964 | ||||||
Unum Group(b) | 21,050 | 1,018,399 | ||||||
2,173,363 | ||||||||
Managed Health Care–1.71% | ||||||||
WellCare Health Plans Inc.(b) | 6,650 | 1,364,314 | ||||||
Office REITs–1.55% | ||||||||
SL Green Realty Corp. | 12,650 | 1,236,411 | ||||||
Oil & Gas Exploration & Production–4.96% | ||||||||
ConocoPhillips | 13,300 | 871,150 | ||||||
Marathon Oil Corp. | 90,250 | 1,647,062 | ||||||
Murphy Oil Corp. | 48,050 | 1,446,786 | ||||||
3,964,998 | ||||||||
Oil & Gas Refining & Marketing–2.04% | ||||||||
HollyFrontier Corp.(b) | 26,850 | 1,629,526 | ||||||
Oil & Gas Storage & Transportation–1.42% | ||||||||
Plains GP Holdings LP–Class A | 46,950 | 1,137,129 | ||||||
Packaged Foods & Meats–0.49% | ||||||||
Conagra Brands, Inc. | 10,600 | 392,942 | ||||||
Pharmaceuticals–1.27% | ||||||||
Perrigo Co. PLC(b) | 13,050 | 1,019,727 | ||||||
Property & Casualty Insurance–1.23% | ||||||||
FNF Group | 26,650 | 981,520 | ||||||
Real Estate Services–1.72% | ||||||||
Jones Lang LaSalle Inc. | 8,100 | 1,373,031 |
Shares | Value | |||||||
Regional Banks–1.81% | ||||||||
Citizens Financial Group, Inc.(b) | 34,950 | $ | 1,450,076 | |||||
Residential REITs–1.98% | ||||||||
Equity LifeStyle Properties, Inc. | 14,000 | 1,248,240 | ||||||
Sun Communities, Inc. | 3,550 | 333,167 | ||||||
1,581,407 | ||||||||
Semiconductor Equipment–1.09% | ||||||||
Teradyne, Inc. | 26,750 | 870,713 | ||||||
Specialized Consumer Services–1.61% | ||||||||
H&R Block, Inc. | 46,550 | 1,287,108 | ||||||
Specialized REITs–2.18% | ||||||||
Extra Space Storage Inc. | 15,150 | 1,357,288 | ||||||
Four Corners Property Trust, Inc. | 17,150 | 388,619 | ||||||
1,745,907 | ||||||||
Systems Software–0.45% | ||||||||
Fortinet Inc.(b) | 6,550 | 362,608 | ||||||
Technology Hardware, Storage & Peripherals–3.34% | ||||||||
HP Inc. | 66,900 | 1,437,681 | ||||||
Xerox Corp.(b) | 39,150 | 1,231,267 | ||||||
2,668,948 | ||||||||
Total Common Stocks & Other Equity Interests |
| 73,170,056 | ||||||
Money Market Funds–9.02% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(c) | 2,525,174 | 2,525,174 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(c) | 1,803,311 | 1,803,491 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(c) | 2,885,913 | 2,885,913 | ||||||
Total Money Market Funds |
| 7,214,578 | ||||||
TOTAL INVESTMENTS IN SECURITIES–100.52% |
| 80,384,634 | ||||||
OTHER ASSETS LESS LIABILITIES–(0.52)% |
| (413,398 | ) | |||||
NET ASSETS–100.00% |
| $ | 79,971,236 |
Investment Abbreviations:
REIT | – Real Estate Investment Trust |
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Long/Short Equity Fund
Open Over-The-Counter Total Return Swap Agreements | ||||||||||||||||||||||||||||||||
Reference Entity | Counterparty | Maturity Dates | Floating Rate Index(1) | Payment Frequency | Notional Amount | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation) | Net Value of Reference Entities | |||||||||||||||||||||||
Equity Securities — Long | Morgan Stanley & Co. LLC | 12/23/2019 | Federal Funds floating rate | Monthly | $ | 81,826,832 | $ | — | $ | (833,796 | )(2) | $ | (833,796 | ) (2) | $ | 80,959,341 | ||||||||||||||||
Equity Securities — Short | Morgan Stanley & Co. LLC | 12/23/2019 | Federal Funds floating rate | Monthly | (81,952,294 | ) | — | (170,299 | )(3) | (170,299 | ) (3) | (82,082,212 | ) | |||||||||||||||||||
Total Return Swap Agreements — Equity Risk | $ | — | $ | (1,004,095 | )(4) | $ | (1,004,095 | ) (4) | $ | (1,122,871 | ) |
(1) | The Fund receives or pays the total return on the long and short positions underlying the total return swap and pays or receives a specific Federal Funds floating rate. |
(2) | Amount includes $33,695 of dividends receivable and financing fees related to the reference entities. |
(3) | Amount includes $(40,381) of dividends payable and financing fees related to the reference entities. |
(4) | Swaps are collaterized by $168,510 cash held with Morgan Stanley & Co. LLC, the Counterparty. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Long/Short Equity Fund
The following table represents the individual long and short positions and related values of equity securities underlying the total return swap with Morgan Stanley & Co. LLC as of April 30, 2018.
Shares | Value | Percentage of Reference Entities | ||||||||||
Equity Securities — Long |
| |||||||||||
Aerospace & Defense | ||||||||||||
Boeing Co. (The) | 4,600 | $ | 1,534,376 | 1.90 | ||||||||
Spirit AeroSystems Holdings, Inc.–Class A | 3,350 | 269,240 | 0.33 | |||||||||
1,803,616 | ||||||||||||
Airlines | ||||||||||||
Delta Air Lines, Inc. | 11,000 | 574,420 | 0.73 | |||||||||
Application Software | ||||||||||||
Adobe Systems, Inc. | 1,800 | 398,880 | 0.49 | |||||||||
Asset Management & Custody Banks | ||||||||||||
Ameriprise Financial Inc. | 8,600 | 1,205,806 | 1.53 | |||||||||
T Rowe Price Group, Inc. | 550 | 62,601 | 0.07 | |||||||||
1,268,407 | ||||||||||||
Auto Parts & Equipment | ||||||||||||
Magna International, Inc. (Canada) | 21,650 | 1,277,350 | 1.57 | |||||||||
Biotechnology | ||||||||||||
AbbVie, Inc. | 13,800 | 1,332,390 | 1.57 | |||||||||
Alexion Pharmaceuticals, Inc. | 10,450 | 1,229,233 | 1.38 | |||||||||
Amgen, Inc. | 7,150 | 1,247,532 | 1.53 | |||||||||
Biogen, Inc. | 4,640 | 1,269,504 | 1.47 | |||||||||
Gilead Sciences, Inc. | 16,900 | 1,220,687 | 1.53 | |||||||||
Regeneron Pharmaceuticals, Inc. | 2,400 | 728,832 | 0.93 | |||||||||
7,028,178 | ||||||||||||
Cable & Satellite | ||||||||||||
Liberty Global PLC (United Kingdom)–Class C | 30,950 | 900,645 | 1.20 | |||||||||
Casinos & Gaming | ||||||||||||
Las Vegas Sands Corp. | 16,900 | 1,239,277 | 1.54 | |||||||||
Commodity Chemicals | ||||||||||||
LyondellBasell Industries N.V.–Class A | 11,150 | 1,178,889 | 1.48 | |||||||||
Computer & Electronics Retail | ||||||||||||
Best Buy Co., Inc. | 21,300 | 1,630,089 | 1.91 | |||||||||
Construction Machinery & Heavy Trucks | ||||||||||||
Cummins, Inc. | 3,150 | 503,559 | 0.65 | |||||||||
Copper | ||||||||||||
Freeport–McMoRan, Inc. | 81,800 | 1,244,178 | 1.88 | |||||||||
Data Processing & Outsourced Services | ||||||||||||
Mastercard Inc.–Class A | 7,000 | 1,247,890 | 1.50 | |||||||||
Total System Services, Inc. | 7,550 | 634,653 | 0.80 | |||||||||
1,882,543 | ||||||||||||
Department Stores | ||||||||||||
Macy’s Inc. | 1,850 | 57,480 | 0.07 |
Shares | Value | Percentage of Reference Entities | ||||||||||
Diversified Banks | ||||||||||||
Bank of Montreal (Canada) | 14,050 | $ | 1,066,816 | 1.29 | ||||||||
Canadian Imperial Bank of Commerce (Canada) | 13,350 | 1,162,117 | 1.41 | |||||||||
Citigroup Inc. | 19,500 | 1,331,265 | 1.65 | |||||||||
Toronto-Dominion Bank (The) (Canada) | 21,950 | 1,232,493 | 1.48 | |||||||||
4,792,691 | ||||||||||||
Electric Utilities | ||||||||||||
Entergy Corp. | 180 | 14,686 | 0.02 | |||||||||
Exelon Corp. | 31,550 | 1,251,904 | 1.49 | |||||||||
FirstEnergy Corp. | 35,650 | 1,226,360 | 1.50 | |||||||||
Fortis, Inc. (Canada) | 2,550 | 85,400 | 0.10 | |||||||||
2,578,350 | ||||||||||||
General Merchandise Stores | ||||||||||||
Dollar General Corp. | 12,650 | 1,221,104 | 1.50 | |||||||||
Target Corp. | 20,000 | 1,452,000 | 1.73 | |||||||||
2,673,104 | ||||||||||||
Gold | ||||||||||||
Newmont Mining Corp. | 28,600 | 1,123,694 | 1.44 | |||||||||
Health Care Facilities | ||||||||||||
HCA Healthcare, Inc. | 12,550 | 1,201,537 | 1.50 | |||||||||
Health Care Services | ||||||||||||
Laboratory Corp. of America Holdings | 2,250 | 384,188 | 0.46 | |||||||||
Hotel & Resort REITs | ||||||||||||
Host Hotels & Resorts Inc. | 4,550 | 88,998 | 0.11 | |||||||||
Hotels, Resorts & Cruise Lines | ||||||||||||
Hilton Worldwide Holdings, Inc. | 17,700 | 1,395,468 | 1.78 | |||||||||
Royal Caribbean Cruises Ltd. | 9,250 | 1,000,757 | 1.35 | |||||||||
2,396,225 | ||||||||||||
Hypermarkets & Super Centers | ||||||||||||
Wal-Mart Stores, Inc. | 15,400 | 1,362,284 | 1.62 | |||||||||
Industrial REITs | ||||||||||||
Prologis, Inc. | 19,100 | 1,239,781 | 1.51 | |||||||||
Integrated Oil & Gas | ||||||||||||
Chevron Corp. | 9,700 | 1,213,567 | 1.46 | |||||||||
Occidental Petroleum Corp. | 17,750 | 1,371,365 | 1.68 | |||||||||
Suncor Energy, Inc. (Canada) | 32,700 | 1,250,121 | 1.52 | |||||||||
3,835,053 | ||||||||||||
Integrated Telecommunication Services | ||||||||||||
Verizon Communications Inc. | 23,150 | 1,142,453 | 1.38 | |||||||||
Internet Software & Services | ||||||||||||
Akamai Technologies Inc. | 4,100 | 293,765 | 0.35 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Long/Short Equity Fund
Shares | Value | Percentage of Reference Entities | ||||||||||
Internet Software & Services–(continued) | ||||||||||||
eBay, Inc. | 30,000 | $ | 1,136,400 | 1.53 | ||||||||
IAC/InterActiveCorp. | 4,200 | 680,988 | 0.83 | |||||||||
Twitter, Inc. | 6,700 | 203,077 | 0.26 | |||||||||
2,314,230 | ||||||||||||
IT Consulting & Other Services | ||||||||||||
Cognizant Technology Solutions Corp.–Class A | 14,600 | 1,194,572 | 1.45 | |||||||||
Teradata Corp. | 9,700 | 396,924 | 0.48 | |||||||||
1,591,496 | ||||||||||||
Life & Health Insurance | ||||||||||||
Aflac, Inc. | 30,900 | 1,408,113 | 1.71 | |||||||||
Lincoln National Corp. | 300 | 21,192 | 0.03 | |||||||||
1,429,305 | ||||||||||||
Managed Health Care | ||||||||||||
Anthem, Inc. | 6,200 | 1,463,138 | 1.72 | |||||||||
Centene Corp. | 11,550 | 1,254,099 | 1.56 | |||||||||
Humana Inc. | 4,350 | 1,279,683 | 1.57 | |||||||||
3,996,920 | ||||||||||||
Oil & Gas Equipment & Services | ||||||||||||
Halliburton Co. | 28,850 | 1,528,761 | 1.84 | |||||||||
Oil & Gas Exploration & Production | ||||||||||||
ConocoPhillips | 11,500 | 753,250 | 0.92 | |||||||||
Continental Resources, Inc. | 9,250 | 611,055 | 0.74 | |||||||||
1,364,305 | ||||||||||||
Oil & Gas Refining & Marketing | ||||||||||||
Marathon Petroleum Corp. | 18,200 | 1,363,362 | 1.78 | |||||||||
Valero Energy Corp. | 14,950 | 1,658,404 | 2.00 | |||||||||
3,021,766 | ||||||||||||
Packaged Foods & Meats | ||||||||||||
Conagra Brands, Inc. | 23,500 | 871,145 | 1.05 | |||||||||
J.M. Smucker Co. (The) | 10,600 | 1,209,248 | 1.49 | |||||||||
2,080,393 | ||||||||||||
Personal Products | ||||||||||||
Estee Lauder Cos, Inc. (The)-Class A | 9,050 | 1,340,214 | 1.64 | |||||||||
Pharmaceuticals | ||||||||||||
Pfizer, Inc. | 6,050 | 221,491 | 0.27 |
Shares | Value | Percentage of Reference Entities | ||||||||||
Property & Casualty Insurance | ||||||||||||
Allstate Corp. (The) | 10,850 | $ | 1,061,347 | 1.31 | ||||||||
CNA Financial Corp. | 9,150 | 461,709 | 0.56 | |||||||||
Progressive Corp. (The) | 23,650 | 1,425,858 | 1.77 | |||||||||
2,948,914 | ||||||||||||
Regional Banks | ||||||||||||
BB&T Corp. | 22,050 | 1,164,240 | 1.44 | |||||||||
Citizens Financial Group, Inc. | 650 | 26,969 | 0.03 | |||||||||
Fifth Third BanCorp | 38,750 | 1,285,337 | 1.51 | |||||||||
Regions Financial Corp. | 36,450 | 681,615 | 0.85 | |||||||||
SunTrust Banks, Inc. | 17,850 | 1,192,380 | 1.47 | |||||||||
4,350,541 | ||||||||||||
Residential REITs | ||||||||||||
Equity Residential | 16,750 | 1,033,642 | 1.24 | |||||||||
Essex Property Trust, Inc. | 700 | 167,783 | 0.20 | |||||||||
1,201,425 | ||||||||||||
Semiconductors | ||||||||||||
Micron Technology, Inc. | 29,700 | 1,365,606 | 1.78 | |||||||||
Specialized REITs | ||||||||||||
Crown Castle International Corp. | 11,100 | 1,119,657 | 1.42 | |||||||||
SBA Communications Corp. | 7,600 | 1,217,748 | 1.54 | |||||||||
2,337,405 | ||||||||||||
Systems Software | ||||||||||||
Fortinet, Inc. | 15,350 | 849,776 | 1.06 | |||||||||
Technology Hardware, Storage & Peripherals | ||||||||||||
HP, Inc. | 1,450 | 31,161 | 0.04 | |||||||||
NetApp, Inc. | 20,150 | 1,341,587 | 1.68 | |||||||||
Seagate Technology PLC | 20,350 | 1,178,062 | 1.45 | |||||||||
Western Digital Corp. | 13,850 | 1,091,242 | 1.47 | |||||||||
3,642,052 | ||||||||||||
Trading Companies & Distributors | ||||||||||||
United Rentals Inc. | 2,300 | 345,000 | 0.44 | |||||||||
W.W. Grainger, Inc. | 4,350 | 1,223,872 | 1.48 | |||||||||
1,568,872 | ||||||||||||
Total Equity Securities — Long |
| $ | 80,959,341 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Long/Short Equity Fund
Shares | Value | Percentage of Reference Entities | ||||||||||
Equity Securities — Short |
| |||||||||||
Airlines | ||||||||||||
Alaska Air Group Inc. | (18,600 | ) | $ | (1,207,698 | ) | (1.57 | ) | |||||
Airport Services | ||||||||||||
Macquarie Infrastructure Corp. | (26,850 | ) | (1,017,615 | ) | (1.27 | ) | ||||||
Apparel, Accessories & Luxury Goods | ||||||||||||
Under Armour, Inc.–Class C | (81,550 | ) | (1,251,793 | ) | (1.45 | ) | ||||||
Application Software | ||||||||||||
Autodesk Inc. | (9,800 | ) | (1,233,820 | ) | (1.54 | ) | ||||||
Tyler Technologies, Inc. | (5,400 | ) | (1,182,168 | ) | (1.50 | ) | ||||||
Ultimate Software Group Inc. (The) | (4,850 | ) | (1,163,612 | ) | (1.45 | ) | ||||||
Workday, Inc.–Class A | (2,750 | ) | (343,310 | ) | (0.44 | ) | ||||||
(3,922,910 | ) | |||||||||||
Asset Management & Custody Banks | ||||||||||||
Brookfield Asset Management Inc. (Canada)–Class A | (31,600 | ) | (1,252,624 | ) | (1.48 | ) | ||||||
Automobile Manufacturers | ||||||||||||
Tesla, Inc. | (3,620 | ) | (1,063,918 | ) | (1.25 | ) | ||||||
Automotive Retail | ||||||||||||
CarMax, Inc. | (19,500 | ) | (1,218,750 | ) | (1.46 | ) | ||||||
Biotechnology | ||||||||||||
Seattle Genetics Inc. | (22,250 | ) | (1,138,978 | ) | (1.35 | ) | ||||||
TESARO, Inc. | (16,950 | ) | (862,925 | ) | (1.08 | ) | ||||||
(2,001,903 | ) | |||||||||||
Building Products | ||||||||||||
Johnson Controls International plc | (36,550 | ) | (1,237,948 | ) | (1.52 | ) | ||||||
Cable & Satellite | ||||||||||||
Liberty Broadband Corp.–Class C | (13,100 | ) | (928,659 | ) | (1.33 | ) | ||||||
Construction Machinery & Heavy Trucks | ||||||||||||
Wabtec Corp./DE | (13,450 | ) | (1,194,495 | ) | (1.44 | ) | ||||||
Construction Materials | ||||||||||||
Martin Marietta Materials, Inc. | (6,250 | ) | (1,217,313 | ) | (1.50 | ) | ||||||
Vulcan Materials Co. | (10,900 | ) | (1,217,421 | ) | (1.51 | ) | ||||||
(2,434,734 | ) | |||||||||||
Data Processing & Outsourced Services | ||||||||||||
Square, Inc.–Class A | (26,400 | ) | (1,249,776 | ) | (1.60 | ) | ||||||
Distributors | ||||||||||||
Genuine Parts Co. | (11,450 | ) | (1,011,264 | ) | (1.24 | ) | ||||||
Electronic Equipment & Instruments | ||||||||||||
Cognex Corp. | (25,100 | ) | (1,160,875 | ) | (1.51 | ) |
Shares | Value | Percentage of Reference Entities | ||||||||||
Financial Exchanges & Data | ||||||||||||
Cboe Global Markets, Inc. | (11,500 | ) | $ | (1,227,970 | ) | (1.51 | ) | |||||
MarketAxess Holdings Inc. | (6,050 | ) | (1,201,712 | ) | (1.49 | ) | ||||||
Thomson Reuters Corp. (Canada) | (19,450 | ) | (782,279 | ) | (0.94 | ) | ||||||
(3,211,961 | ) | |||||||||||
Footwear | ||||||||||||
NIKE Inc.–Class B | (17,550 | ) | (1,200,245 | ) | (1.43 | ) | ||||||
Health Care Distributors | ||||||||||||
Henry Schein Inc. | (16,050 | ) | (1,219,800 | ) | (1.45 | ) | ||||||
Health Care Equipment | ||||||||||||
Boston Scientific Corp. | (42,200 | ) | (1,211,984 | ) | (1.48 | ) | ||||||
DexCom, Inc. | (16,200 | ) | (1,185,516 | ) | (1.45 | ) | ||||||
(2,397,500 | ) | |||||||||||
Health Care REITs | ||||||||||||
Omega Healthcare Investors Inc. | (44,100 | ) | (1,145,718 | ) | (1.37 | ) | ||||||
Welltower, Inc. | (23,850 | ) | (1,274,544 | ) | (1.47 | ) | ||||||
(2,420,262 | ) | |||||||||||
Health Care Services | ||||||||||||
Envision Healthcare Corp. | (30,350 | ) | (1,128,109 | ) | (1.38 | ) | ||||||
Health Care Supplies | ||||||||||||
DENTSPLY SIRONA Inc. | (24,900 | ) | (1,253,466 | ) | (1.50 | ) | ||||||
Home Entertainment Software | ||||||||||||
Take-Two Interactive Software, Inc. | (12,600 | ) | (1,256,346 | ) | (1.48 | ) | ||||||
Home Furnishings | ||||||||||||
Leggett & Platt, Inc. | (25,900 | ) | (1,050,245 | ) | (1.36 | ) | ||||||
Household Appliances | ||||||||||||
Whirlpool Corp. | (7,800 | ) | (1,208,610 | ) | (1.48 | ) | ||||||
Housewares & Specialties | ||||||||||||
Newell Brands Inc. | (45,050 | ) | (1,244,732 | ) | (1.46 | ) | ||||||
Industrial Conglomerates | ||||||||||||
Carlisle Cos Inc. | (10,000 | ) | (1,077,300 | ) | (1.25 | ) | ||||||
General Electric Co. | (82,850 | ) | (1,165,699 | ) | (1.47 | ) | ||||||
(2,242,999 | ) | |||||||||||
Industrial Machinery | ||||||||||||
Flowserve Corp. | (26,400 | ) | (1,172,424 | ) | (1.51 | ) | ||||||
Middleby Corp. (The) | (9,500 | ) | (1,195,480 | ) | (1.48 | ) | ||||||
(2,367,904 | ) | |||||||||||
Internet & Direct Marketing Retail | ||||||||||||
Amazon.com, Inc. | (780 | ) | (1,221,581 | ) | (1.44 | ) | ||||||
Investment Banking & Brokerage | ||||||||||||
Charles Schwab Corp. (The) | (22,250 | ) | (1,238,880 | ) | (1.50 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco Long/Short Equity Fund
Shares | Value | Percentage of Reference Entities | ||||||||||
IT Consulting & Other Services | ||||||||||||
Gartner Inc. | (10,300 | ) | $ | (1,249,287 | ) | (1.48 | ) | |||||
Movies & Entertainment | ||||||||||||
Liberty Media Corp.–Class A | (4,300 | ) | (94,471 | ) | (0.12 | ) | ||||||
Liberty Media Corp.–Class C | (39,650 | ) | (1,170,468 | ) | (1.45 | ) | ||||||
(1,264,939 | ) | |||||||||||
Office REITs | ||||||||||||
Vornado Realty Trust | (18,550 | ) | (1,261,957 | ) | (1.47 | ) | ||||||
Oil & Gas Exploration & Production | ||||||||||||
Diamondback Energy Inc. | (9,650 | ) | (1,239,542 | ) | (1.51 | ) | ||||||
Hess Corp. | (21,100 | ) | (1,202,489 | ) | (1.51 | ) | ||||||
Parsley Energy Inc.–Class A | (40,900 | ) | (1,228,227 | ) | (1.53 | ) | ||||||
Range Resources Corp. | (79,600 | ) | (1,102,460 | ) | (1.33 | ) | ||||||
(4,772,718 | ) | |||||||||||
Oil & Gas Storage & Transportation | ||||||||||||
Cheniere Energy, Inc. | (11,550 | ) | (671,748 | ) | (0.82 | ) | ||||||
Enbridge, Inc. (Canada) | (41,400 | ) | (1,253,178 | ) | (1.56 | ) | ||||||
Pembina Pipeline Corp. (Canada) | (16,300 | ) | (519,318 | ) | (0.64 | ) | ||||||
Targa Resources Corp. | (25,500 | ) | (1,197,735 | ) | (1.49 | ) | ||||||
TransCanada Corp. (Canada) | (4,950 | ) | (210,128 | ) | (0.26 | ) | ||||||
(3,852,107 | ) | |||||||||||
Packaged Foods & Meats | ||||||||||||
Kraft Heinz Co. (The) | (21,500 | ) | (1,212,170 | ) | (1.50 | ) | ||||||
Personal Products | ||||||||||||
Coty Inc.–Class A | (73,650 | ) | (1,277,827 | ) | (1.50 | ) | ||||||
Property & Casualty Insurance | ||||||||||||
Arch Capital Group Ltd. | (12,550 | ) | (1,005,631 | ) | (1.24 | ) | ||||||
Axis Capital Holdings Ltd. | (20,850 | ) | (1,223,895 | ) | (1.44 | ) | ||||||
Cincinnati Financial Corp. | (14,050 | ) | (988,277 | ) | (1.30 | ) | ||||||
Markel Corp. | (955 | ) | (1,079,188 | ) | (1.36 | ) | ||||||
(4,296,991 | ) | |||||||||||
Railroads | ||||||||||||
Canadian National Railway Co. (Canada) | (16,200 | ) | (1,251,936 | ) | (1.51 | ) |
Shares | Value | Percentage of Reference Entities | ||||||||||
Real Estate Development | ||||||||||||
Howard Hughes Corp. (The) | (8,500 | ) | $ | (1,150,050 | ) | (1.42 | ) | |||||
Regional Banks | ||||||||||||
Bank of the Ozarks | (23,600 | ) | (1,104,480 | ) | (1.36 | ) | ||||||
First Republic Bank | (12,850 | ) | (1,193,379 | ) | (1.47 | ) | ||||||
Signature Bank/New York NY | (5,150 | ) | (654,823 | ) | (0.81 | ) | ||||||
(2,952,682 | ) | |||||||||||
Reinsurance | ||||||||||||
Alleghany Corp. | (1,920 | ) | (1,103,366 | ) | (1.38 | ) | ||||||
Renaissance Holdings Ltd. (Bermuda) | (8,600 | ) | (1,169,944 | ) | (1.44 | ) | ||||||
(2,273,310 | ) | |||||||||||
Research & Consulting Services | ||||||||||||
IHS Markit Ltd. | (23,500 | ) | (1,154,555 | ) | (1.41 | ) | ||||||
Residential REITs | ||||||||||||
American Campus Communities Inc. | (6,250 | ) | (244,437 | ) | (0.29 | ) | ||||||
Mid-America Apartment Communities Inc. | (3,400 | ) | (310,964 | ) | (0.37 | ) | ||||||
(555,401 | ) | |||||||||||
Restaurants | ||||||||||||
Chipotle Mexican Grill, Inc. | (3,600 | ) | (1,523,988 | ) | (1.45 | ) | ||||||
Semiconductors | ||||||||||||
Advanced Micro Devices Inc. | (116,750 | ) | (1,270,240 | ) | (1.43 | ) | ||||||
Analog Devices, Inc. | (13,850 | ) | (1,209,797 | ) | (1.49 | ) | ||||||
(2,480,037 | ) | |||||||||||
Specialty Chemicals | ||||||||||||
Albemarle Corp. | (12,500 | ) | (1,212,000 | ) | (1.48 | ) | ||||||
Specialty Stores | ||||||||||||
Ulta Beauty Inc. | (5,100 | ) | (1,279,641 | ) | (1.49 | ) | ||||||
Trucking | ||||||||||||
AMERCO | (720 | ) | (243,014 | ) | (0.30 | ) | ||||||
Total Equity Securities — Short |
| $ | (82,082,212 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco Long/Short Equity Fund
Portfolio Composition
By sector, based on total net assets
as of April 30, 2018
Equity Securities | Gross Exposure3 | Net Exposure4 | ||||||||||||||
Long1 | Short2 | |||||||||||||||
Consumer Discretionary | 33.9 | % | 19.3 | % | 53.2 | % | 14.6 | % | ||||||||
Information Technology | 30.9 | 14.2 | 45.1 | 16.7 | ||||||||||||
Financials | 27.4 | 19.0 | 46.4 | 8.4 | ||||||||||||
Health Care | 24.4 | 10.0 | 34.4 | 14.4 | ||||||||||||
Energy | 20.6 | 10.8 | 31.4 | 9.8 | ||||||||||||
Real Estate | 15.0 | 6.7 | 21.7 | 8.3 | ||||||||||||
Materials | 12.6 | 4.6 | 17.2 | 8.0 | ||||||||||||
Industrials | 11.7 | 14.9 | 26.6 | -3.2 | ||||||||||||
Consumer Staples | 8.0 | 3.1 | 11.1 | 4.9 | ||||||||||||
Utilities | 6.8 | — | 6.8 | 6.8 | ||||||||||||
Telecommunication Services | 1.4 | — | 1.4 | 1.4 | ||||||||||||
Money Market Funds Plus Other Assets Less Liabilities | 8.5 | — | 8.5 | 8.5 | ||||||||||||
Total | 201.2 | % | 102.6 | % | 303.8 | % | 98.6 | % |
1 | Represents the value of the equity securities in the portfolio and the equity securities underlying the Fund’s equity long portfolio swap. |
2 | Represents the value of the equity securities underlying the Fund’s equity short portfolio swap. |
3 | Represents the cumulative exposure of the Fund’s long and short positions. |
4 | Represents the net exposure of the Fund’s long and short positions. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
12 Invesco Long/Short Equity Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $63,769,733) | $ | 73,170,056 | ||
Investments in affiliated money market funds, at value (Cost $7,214,449) | 7,214,578 | |||
Deposits with brokers: | 168,510 | |||
Receivable for: | ||||
Investments sold | 5,063 | |||
Fund shares sold | 492,289 | |||
Dividends and interest | 55,529 | |||
Investment for trustee deferred compensation and retirement plans | 10,778 | |||
Other assets | 37,433 | |||
Total assets | 81,154,236 | |||
Liabilities: |
| |||
Other investments: | ||||
Unrealized depreciation on swap agreements — OTC | 1,004,095 | |||
Payable for: | ||||
Fund shares reacquired | 41,398 | |||
Amount due custodian | 48,904 | |||
Accrued fees to affiliates | 13,284 | |||
Accrued trustees’ and officers’ fees and benefits | 1,504 | |||
Accrued other operating expenses | 63,037 | |||
Trustee deferred compensation and retirement plans | 10,778 | |||
Total liabilities | 1,183,000 | |||
Net assets applicable to shares outstanding | $ | 79,971,236 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 68,955,446 | ||
Undistributed net investment income (loss) | (273,589 | ) | ||
Undistributed net realized gain | 2,893,046 | |||
Net unrealized appreciation | 8,396,333 | |||
$ | 79,971,236 |
Net Assets: |
| |||
Class A | $ | 16,143,601 | ||
Class C | $ | 4,250,001 | ||
Class R | $ | 176,546 | ||
Class Y | $ | 14,131,999 | ||
Class R5 | $ | 47,741 | ||
Class R6 | $ | 45,221,348 | ||
Shares outstanding, no par value, |
| |||
Class A | 1,386,688 | |||
Class C | 373,608 | |||
Class R | 15,281 | |||
Class Y | 1,205,518 | |||
Class R5 | 4,071 | |||
Class R6 | 3,854,316 | |||
Class A: | ||||
Net asset value per share | $ | 11.64 | ||
Maximum offering price per share | ||||
(Net asset value of $11.64 ¸ 94.50%) | $ | 12.32 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 11.38 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 11.55 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 11.72 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 11.73 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 11.73 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
13 Invesco Long/Short Equity Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of foreign withholding taxes of $4,272) | $ | 581,249 | ||
Dividends from affiliated money market funds | 39,724 | |||
Total investment income | 620,973 | |||
Expenses: | ||||
Advisory fees | 313,458 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 3,652 | |||
Distribution fees: | ||||
Class A | 17,940 | |||
Class C | 17,442 | |||
Class R | 381 | |||
Transfer agent fees — A, C, R and Y | 22,052 | |||
Transfer agent fees — R5 | 14 | |||
Transfer agent fees — R6 | 120 | |||
Trustees’ and officers’ fees and benefits | 11,484 | |||
Registration and filing fees | 40,432 | |||
Reports to shareholders | 13,709 | |||
Professional services fees | 52,009 | |||
Other | 5,328 | |||
Total expenses | 522,816 | |||
Less: Fees waived and expense offset arrangement(s) | (3,237 | ) | ||
Net expenses | 519,579 | |||
Net investment income | 101,394 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | 4,404,537 | |||
Swap agreements | (1,459,108 | ) | ||
2,945,429 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | 81,709 | |||
Foreign currencies | (24 | ) | ||
Swap agreements | (1,313,343 | ) | ||
(1,231,658 | ) | |||
Net realized and unrealized gain | 1,713,771 | |||
Net increase in net assets resulting from operations | $ | 1,815,165 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
14 Invesco Long/Short Equity Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income | $ | 101,394 | $ | 366,854 | ||||
Net realized gain | 2,945,429 | 11,443,698 | ||||||
Change in net unrealized appreciation (depreciation) | (1,231,658 | ) | 5,648,778 | |||||
Net increase in net assets resulting from operations | 1,815,165 | 17,459,330 | ||||||
Distributions to shareholders from net investment income: | ||||||||
Class A | (863,669 | ) | — | |||||
Class C | (187,386 | ) | — | |||||
Class R | (9,291 | ) | — | |||||
Class Y | (914,098 | ) | — | |||||
Class R5 | (3,460 | ) | — | |||||
Class R6 | (3,373,404 | ) | — | |||||
Total distributions from net investment income | (5,351,308 | ) | — | |||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | (882,363 | ) | (81,636 | ) | ||||
Class C | (210,556 | ) | (16,680 | ) | ||||
Class R | (9,787 | ) | (593 | ) | ||||
Class Y | (901,461 | ) | (52,325 | ) | ||||
Class R5 | (3,369 | ) | (3,814 | ) | ||||
Class R6 | (3,285,105 | ) | (296,699 | ) | ||||
Total distributions from net realized gains | (5,292,641 | ) | (451,747 | ) | ||||
Share transactions–net: | ||||||||
Class A | 6,324,202 | (2,845,486 | ) | |||||
Class C | 1,868,213 | (155,873 | ) | |||||
Class R | 62,549 | 25,428 | ||||||
Class Y | 3,645,954 | 2,198,569 | ||||||
Class R5 | 6,485 | (614,953 | ) | |||||
Class R6 | 3,067,595 | (10,273,941 | ) | |||||
Net increase (decrease) in net assets resulting from share transactions | 14,974,998 | (11,666,256 | ) | |||||
Net increase in net assets | 6,146,214 | 5,341,327 | ||||||
Net assets: | ||||||||
Beginning of period | 73,825,022 | 68,483,695 | ||||||
End of period (includes undistributed net investment income of $(273,589) and $4,976,325, respectively) | $ | 79,971,236 | $ | 73,825,022 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Long/Short Equity Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek long-term capital appreciation.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances
15 Invesco Long/Short Equity Fund
load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
16 Invesco Long/Short Equity Fund
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Swap Agreements — The Fund may enter into various swap transactions, including interest rate, total return, volatility, variance, index, currency and credit default swap contracts (“CDS”) for investment purposes or to manage interest rate, equity, currency or credit risk. Such transactions are agreements between two parties (“Counterparties”). These agreements may contain among other conditions, events of default and termination events, and various covenants and representations such as provisions that require the Fund to maintain a pre-determined level of net assets, and/or provide limits regarding the decline of the Fund’s NAV over specific periods of time. If the Fund were to trigger such provisions and have open derivative positions at that time, the Counterparty may be able to terminate such agreement and request immediate payment in an amount equal to the net liability positions, if any. |
Interest rate, total return, volatility, variance, index, and currency swap agreements are two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a notional amount, i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate or return of an underlying asset, in a particular foreign currency, or in a “basket” of securities representing a particular index.
A total return swap is an agreement in which one party makes payments based on a set rate, either fixed or variable, while the other party makes payments based on the return of an underlying asset, which includes both the income generated and capital gains, if any. The unrealized appreciation (depreciation) on total return swaps includes dividends on the underlying equity securities and financing rate payable from the Counterparty. At the maturity date, a net cash flow is exchanged where the total return is equivalent to the return of the underlying reference less a financing rate, if any. As a receiver, the Fund would receive payments based on any positive total return and would owe payments in the event of a negative total return. As the payer, the Fund would owe payments on any net positive total return, and would receive payment in the event of a negative total return.
17 Invesco Long/Short Equity Fund
Changes in the value of swap agreements are recognized as unrealized gains (losses) in the Statement of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Statement of Assets and Liabilities and may be referred to as upfront payments. The Fund accrues for the fixed payment stream and amortizes upfront payments, if any, on swap agreements on a daily basis with the net amount, recorded as a component of realized gain (loss) on the Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Statement of Operations. The Fund segregates cash or liquid securities having a value at least equal to the amount of the potential obligation of a Fund under any swap transaction. Cash held as collateral is recorded as deposits with brokers on the Statement of Assets and Liabilities. Entering into these agreements involves, to varying degrees, lack of liquidity and elements of credit, market, and Counterparty risk in excess of amounts recognized on the Statement of Assets and Liabilities. Such risks involve the possibility that a swap is difficult to sell or liquidate; the Counterparty does not honor its obligations under the agreement and unfavorable interest rates and market fluctuations. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund’s exposure is unlimited.
J. | Leverage Risk — Leverage exists when the Fund can lose more than it originally invests because it purchases or sells an instrument or enters into a transaction without investing an amount equal to the full economic exposure of the instrument or transaction. |
K. | Collateral — To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund’s practice to replace such collateral no later than the next business day. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $250 million | 0.80% | |||
Next $250 million | 0.77% | |||
Next $500 million | 0.75% | |||
Next $1.5 billion | 0.72% | |||
Next $2.5 billion | 0.70% | |||
Next $2.5 billion | 0.67% | |||
Next $2.5 billion | 0.65% | |||
Over $10 billion | 0.62% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.80%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.59%, 2.34%, 1.84%, 1.34%, 1.34% and 1.34%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $2,982.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
18 Invesco Long/Short Equity Fund
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $6,326 in front-end sales commissions from the sale of Class A shares and $1 and $112 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Common Stocks & Other Equity Interests | $ | 73,170,056 | $ | — | $ | — | $ | 73,170,056 | ||||||||
Money Market Funds | 7,214,578 | — | — | 7,214,578 | ||||||||||||
Total Investments in Securities | 80,384,634 | — | — | 80,384,634 | ||||||||||||
Other Investments — Liabilities* | ||||||||||||||||
Swap Agreements | — | (1,004,095 | ) | — | (1,004,095 | ) | ||||||||||
Total Investments | $ | 80,384,634 | $ | (1,004,095 | ) | $ | — | $ | 79,380,539 |
* | Unrealized appreciation (depreciation). |
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Statement of Assets and Liabilities.
19 Invesco Long/Short Equity Fund
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2018:
Value | ||||
Derivative Liabilities | Equity Risk | |||
Unrealized depreciation on swap agreements — OTC | $ | (1,004,095 | ) | |
Derivatives not subject to master netting agreements | — | |||
Total Derivative Liabilities subject to master netting agreements | $ | (1,004,095 | ) |
Offsetting Assets and Liabilities
The table below reflects the Fund’s exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of April 30, 2018.
Financial Derivative Assets | Financial Derivative Liabilities | Collateral (Received)/Pledged | ||||||||||||||||||||||
Counterparty | Swap Agreements | Swap Agreements | Net Value of Derivatives | Non-Cash | Cash | Net Amount | ||||||||||||||||||
Morgan Stanley & Co. LLC | $ | — | $ | (1,004,095 | ) | $ | (1,004,095 | ) | $ | — | $ | 168,510 | $ | (835,585 | ) |
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Statement of Operations | ||||
Equity Risk | ||||
Realized Gain (Loss): | ||||
Swap agreements | $ | (1,459,108 | ) | |
Change in Net Unrealized Appreciation (Depreciation): | ||||
Swap agreements | (1,313,343 | ) | ||
Total | $ | (2,772,451 | ) |
The table below summarizes the average notional value of swap agreements outstanding during the period.
Swap Agreements | ||||
Average notional value | $ | 132,100,084 |
NOTE 5—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $255.
NOTE 6—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Fund.
NOTE 7—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
20 Invesco Long/Short Equity Fund
NOTE 8—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2017.
NOTE 9—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $36,332,655 and $37,280,862, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 10,466,716 | ||
Aggregate unrealized (depreciation) of investments | (2,388,297 | ) | ||
Net unrealized appreciation of investments | $ | 8,078,419 |
Cost of investments for tax purposes is $71,302,120.
NOTE 10—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: |
| |||||||||||||||
Class A | 565,462 | $ | 6,986,589 | 304,596 | $ | 3,646,029 | ||||||||||
Class C | 167,348 | 2,007,357 | 46,302 | 524,043 | ||||||||||||
Class R | 4,211 | 51,018 | 3,850 | 46,256 | ||||||||||||
Class Y | 748,990 | 9,166,266 | 431,307 | 5,111,591 | ||||||||||||
Class R5 | 114 | 1,418 | 1,004 | 11,943 | ||||||||||||
Class R6 | 187,625 | 2,211,577 | 278,872 | 3,188,531 | ||||||||||||
Issued as reinvestment of dividends: |
| |||||||||||||||
Class A | 145,295 | 1,699,950 | 5,622 | 66,343 | ||||||||||||
Class C | 32,792 | 375,798 | 1,371 | 15,922 | ||||||||||||
Class R | 1,483 | 17,226 | 44 | 519 | ||||||||||||
Class Y | 66,645 | 784,426 | 1,371 | 16,268 | ||||||||||||
Class R5 | 450 | 5,291 | 11 | 129 | ||||||||||||
Class R6 | 565,588 | 6,656,973 | 24,685 | 293,014 | ||||||||||||
Reacquired: |
| |||||||||||||||
Class A | (195,044 | ) | (2,362,337 | ) | (545,259 | ) | (6,557,858 | ) | ||||||||
Class C | (45,273 | ) | (514,942 | ) | (60,626 | ) | (695,838 | ) | ||||||||
Class R | (488 | ) | (5,695 | ) | (1,834 | ) | (21,347 | ) | ||||||||
Class Y | (526,531 | ) | (6,304,738 | ) | (240,137 | ) | (2,929,290 | ) | ||||||||
Class R5 | (19 | ) | (224 | ) | (49,229 | ) | (627,025 | ) | ||||||||
Class R6 | (459,554 | ) | (5,800,955 | ) | (1,150,985 | ) | (13,755,486 | ) | ||||||||
Net increase (decrease) in share activity | 1,259,094 | $ | 14,974,998 | (949,035 | ) | $ | (11,666,256 | ) |
(a) | There is an entity that is a record owner of more than 5% of the outstanding shares of the Fund and owns 24% of the outstanding shares of the Fund. IDI has an agreement with this entity to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to this entity, which is considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as, securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by this entity is also owned beneficially. |
In addition, 56% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser. |
21 Invesco Long/Short Equity Fund
NOTE 11—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 13.15 | $ | 0.00 | $ | 0.37 | $ | 0.37 | $ | (0.93 | ) | $ | (0.95 | ) | $ | (1.88 | ) | $ | 11.64 | 2.72 | % | $ | 16,144 | 1.56 | %(d) | 1.57 | %(d) | 0.02 | %(d) | 50 | % | |||||||||||||||||||||||||
Year ended 10/31/17 | 10.45 | 0.03 | 2.74 | 2.77 | — | (0.07 | ) | (0.07 | ) | 13.15 | 26.62 | 11,457 | 1.57 | 1.62 | 0.27 | 95 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.50 | 0.06 | (e) | (0.50 | ) | (0.44 | ) | (0.55 | ) | (0.06 | ) | (0.61 | ) | 10.45 | (4.03 | ) | 11,562 | 1.85 | 2.08 | 0.58 | (e) | 102 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 11.00 | 0.01 | 0.49 | 0.50 | — | (0.00 | ) | — | 11.50 | 4.57 | 12,854 | 1.85 | 2.76 | 0.11 | 89 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.02 | ) | 1.02 | 1.00 | — | — | — | 11.00 | 10.00 | 16,796 | 1.85 | (g) | 3.04 | (g) | (0.25 | )(g) | 102 | ||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 12.86 | (0.04 | ) | 0.35 | 0.31 | (0.84 | ) | (0.95 | ) | (1.79 | ) | 11.38 | 2.34 | 4,250 | 2.31 | (d) | 2.32 | (d) | (0.73 | )(d) | 50 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.30 | (0.06 | ) | 2.69 | 2.63 | — | (0.07 | ) | (0.07 | ) | 12.86 | 25.65 | 2,812 | 2.32 | 2.37 | (0.48 | ) | 95 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.34 | (0.02 | )(e) | (0.48 | ) | (0.50 | ) | (0.48 | ) | (0.06 | ) | (0.54 | ) | 10.30 | (4.68 | ) | 2,385 | 2.60 | 2.83 | (0.17 | )(e) | 102 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.92 | (0.07 | ) | 0.49 | 0.42 | — | (0.00 | ) | — | 11.34 | 3.87 | 2,350 | 2.60 | 3.51 | (0.64 | ) | 89 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.10 | ) | 1.02 | 0.92 | — | — | — | 10.92 | 9.20 | 2,618 | 2.60 | (g) | 3.79 | (g) | (1.00 | )(g) | 102 | ||||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 13.06 | (0.01 | ) | 0.35 | 0.34 | (0.90 | ) | (0.95 | ) | (1.85 | ) | 11.55 | 2.51 | 177 | 1.81 | (d) | 1.82 | (d) | (0.23 | )(d) | 50 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.40 | 0.00 | 2.73 | 2.73 | — | (0.07 | ) | (0.07 | ) | 13.06 | 26.37 | 132 | 1.82 | 1.87 | 0.02 | 95 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.45 | 0.04 | (e) | (0.50 | ) | (0.46 | ) | (0.53 | ) | (0.06 | ) | (0.59 | ) | 10.40 | (4.27 | ) | 83 | 2.10 | 2.33 | 0.33 | (e) | 102 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.98 | (0.02 | ) | 0.49 | 0.47 | — | (0.00 | ) | — | 11.45 | 4.31 | 40 | 2.10 | 3.01 | (0.14 | ) | 89 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | (0.04 | ) | 1.02 | 0.98 | — | — | — | 10.98 | 9.80 | 27 | 2.10 | (g) | 3.29 | (g) | (0.50 | )(g) | 102 | ||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 13.25 | 0.02 | 0.36 | 0.38 | (0.96 | ) | (0.95 | ) | (1.91 | ) | 11.72 | 2.81 | 14,132 | 1.31 | (d) | 1.32 | (d) | 0.27 | (d) | 50 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.51 | 0.06 | 2.75 | 2.81 | — | (0.07 | ) | (0.07 | ) | 13.25 | 26.85 | 12,145 | 1.32 | 1.37 | 0.52 | 95 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.56 | 0.09 | (e) | (0.50 | ) | (0.41 | ) | (0.58 | ) | (0.06 | ) | (0.64 | ) | 10.51 | (3.74 | ) | 7,604 | 1.60 | 1.83 | 0.83 | (e) | 102 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 11.02 | 0.04 | 0.50 | 0.54 | — | (0.00 | ) | — | 11.56 | 4.93 | 7,709 | 1.60 | 2.51 | 0.36 | 89 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.00 | 1.02 | 1.02 | — | — | — | 11.02 | 10.20 | 12,389 | 1.60 | (g) | 2.79 | (g) | 0.00 | (g) | 102 | |||||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 13.26 | 0.02 | 0.37 | 0.39 | (0.97 | ) | (0.95 | ) | (1.92 | ) | 11.73 | 2.91 | 48 | 1.23 | (d) | 1.24 | (d) | 0.35 | (d) | 50 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.50 | 0.07 | 2.76 | 2.83 | — | (0.07 | ) | (0.07 | ) | 13.26 | 27.07 | 47 | 1.22 | 1.25 | 0.62 | 95 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.56 | 0.09 | (e) | (0.51 | ) | (0.42 | ) | (0.58 | ) | (0.06 | ) | (0.64 | ) | 10.50 | (3.83 | ) | 543 | 1.60 | 1.71 | 0.83 | (e) | 102 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 11.02 | 0.04 | 0.50 | 0.54 | — | (0.00 | ) | — | 11.56 | 4.93 | 578 | 1.60 | 2.38 | 0.36 | 89 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.00 | 1.02 | 1.02 | — | — | — | 11.02 | 10.20 | 718 | 1.60 | (g) | 2.69 | (g) | 0.00 | (g) | 102 | |||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 13.26 | 0.03 | 0.36 | 0.39 | (0.97 | ) | (0.95 | ) | (1.92 | ) | 11.73 | 2.91 | 45,221 | 1.18 | (d) | 1.19 | (d) | 0.40 | (d) | 50 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.50 | 0.07 | 2.76 | 2.83 | — | (0.07 | ) | (0.07 | ) | 13.26 | 27.07 | 47,232 | 1.22 | 1.25 | 0.62 | 95 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 11.56 | 0.09 | (e) | (0.51 | ) | (0.42 | ) | (0.58 | ) | (0.06 | ) | (0.64 | ) | 10.50 | (3.83 | ) | 46,305 | 1.60 | 1.71 | 0.83 | (e) | 102 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 11.02 | 0.04 | 0.50 | 0.54 | — | (0.00 | ) | — | 11.56 | 4.93 | 609 | 1.60 | 2.38 | 0.36 | 89 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(f) | 10.00 | 0.00 | 1.02 | 1.02 | — | — | — | 11.02 | 10.20 | 562 | 1.60 | (g) | 2.69 | (g) | 0.00 | (g) | 102 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $14,471, $3,517, $154, $13,769, $49 and $47,054 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Net investment income per share and the ratio of net investment income to average net assets include significant dividends received during the period. Net investment income per share and the ratio of net investment income to average net assets excluding the significant dividends are $(0.00) and (0.00)%, $(0.08) and (0.75)%, $(0.02) and (0.25)%, $0.03 and 0.25%, $0.03 and 0.25% and $0.03 and 0.25% for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(f) | Commencement date of December 19, 2013. |
(g) | Annualized. |
22 Invesco Long/Short Equity Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 1,027.20 | $ | 7.84 | $ | 1,017.06 | $ | 7.80 | 1.56 | % | ||||||||||||
C | 1,000.00 | 1,023.40 | 11.59 | 1,013.34 | 11.53 | 2.31 | ||||||||||||||||||
R | 1,000.00 | 1,025.10 | 9.09 | 1,015.82 | 9.05 | 1.81 | ||||||||||||||||||
Y | 1,000.00 | 1,028.10 | 6.59 | 1,018.30 | 6.56 | 1.31 | ||||||||||||||||||
R5 | 1,000.00 | 1,029.10 | 6.19 | 1,018.70 | 6.16 | 1.23 | ||||||||||||||||||
R6 | 1,000.00 | 1,028.40 | 5.93 | 1,018.94 | 5.91 | 1.18 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
23 Invesco Long/Short Equity Fund
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Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
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Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. LSE-SAR-1 06132018 1011
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Semiannual Report to Shareholders
| April 30, 2018 | |||
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Invesco Low Volatility Emerging Markets Fund
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Nasdaq: | ||||
A: LVLAX ∎ C: LVLCX ∎ R: LVLRX ∎ Y: LVLYX ∎ R5: LVLFX ∎ R6: LVLSX |
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2
| Fund Performance
| |||
4
| Letters to Shareholders
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5
| Schedule of Investments
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8
| Financial Statements
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10
| Notes to Financial Statements
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18
| Financial Highlights
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19
| Fund Expenses
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For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
|
Class A Shares | 3.95 | % | ||
Class C Shares | 3.56 | |||
Class R Shares | 3.97 | |||
Class Y Shares | 4.12 | |||
Class R5 Shares | 4.12 | |||
Class R6 Shares | 4.13 | |||
MSCI All Country World Index▼ (Broad Market Index) | 3.56 | |||
MSCI Emerging Markets Index▼ (Style-Specific Index) | 4.80 | |||
Lipper Emerging Market Funds Index∎ (Peer Group Index) | 4.01 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
|
The MSCI All Country World Index is an unmanaged index considered representative of large- and mid-cap stocks across developed and emerging markets. The index is computed using the net return, which withholds applicable taxes for non-resident investors.
The MSCI Emerging Markets Index is an unmanaged index considered representative of stocks of developing countries. The index is computed using the net return, which withholds applicable taxes for non-resident investors.
The Lipper Emerging Market Funds Index is an unmanaged index considered representative of emerging market funds tracked by Lipper.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Low Volatility Emerging Markets Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (12/17/13) | 1.48 | % | ||||
1 Year | 5.36 | |||||
Class C Shares |
| |||||
Inception (12/17/13) | 2.02 | % | ||||
1 Year | 9.72 | |||||
Class R Shares |
| |||||
Inception (12/17/13) | 2.57 | % | ||||
1 Year | 11.43 | |||||
Class Y Shares |
| |||||
Inception (12/17/13) | 3.06 | % | ||||
1 Year | 11.81 | |||||
Class R5 Shares |
| |||||
Inception (12/17/13) | 3.06 | % | ||||
1 Year | 11.81 | |||||
Class R6 Shares |
| |||||
Inception (12/17/13) | 3.04 | % | ||||
1 Year | 11.83 |
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.33%, 2.08%, 1.58%, 1.08%, 1.08% and 1.08%, respectively.1 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 2.09%, 2.84%, 2.34%, 1.84%, 1.65% and 1.65%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (12/17/13) | 1.81 | % | ||||
1 Year | 8.86 | |||||
Class C Shares | ||||||
Inception (12/17/13) | 2.36 | % | ||||
1 Year | 13.25 | |||||
Class R Shares | ||||||
Inception (12/17/13) | 2.90 | % | ||||
1 Year | 15.01 | |||||
Class Y Shares |
| |||||
Inception (12/17/13) | 3.42 | % | ||||
1 Year | 15.53 | |||||
Class R5 Shares | ||||||
Inception (12/17/13) | 3.42 | % | ||||
1 Year | 15.53 | |||||
Class R6 Shares | ||||||
Inception (12/17/13) | 3.40 | % | ||||
1 Year | 15.55 |
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 class shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least February 28, 2019. See current prospectus for more information. |
3 Invesco Low Volatility Emerging Markets Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Low Volatility Emerging Markets Fund
Schedule of Investments
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–95.56% |
| |||||||
Brazil–5.11% | ||||||||
Braskem S.A.–Preference Shares–ADR | 39,500 | $ | 512,198 | |||||
Ecorodovias Infraestrutura e Logistica S.A. | 156,900 | 448,286 | ||||||
Estacio Participacoes S.A. | 29,600 | 267,908 | ||||||
Qualicorp S.A. | 47,300 | 327,394 | ||||||
SLC Agricola S.A. | 23,300 | 298,541 | ||||||
Transmissora Alianca de Energia Eletrica | 71,000 | 433,478 | ||||||
2,287,805 | ||||||||
Chile–0.26% | ||||||||
Embotelladora Andina S.A.–Preference Shares–Class B | 23,201 | 115,385 | ||||||
China–12.58% | ||||||||
Autohome Inc.–ADR | 5,677 | 553,791 | ||||||
China Lilang Ltd. | 118,000 | 147,820 | ||||||
China Shenhua Energy Co. Ltd.–Class H | 232,500 | 571,316 | ||||||
China Shineway Pharmaceutical Group Ltd. | 143,000 | 293,865 | ||||||
Chongqing Rural Commercial Bank Co., Ltd.–Class H | 799,000 | 610,790 | ||||||
Guangzhou Automobile Group Co., Ltd.–Class H | 240,000 | 442,150 | ||||||
Jiangsu Expressway Co. Ltd.–Class H | 134,000 | 183,398 | ||||||
Kingboard Chemical Holdings Ltd. | 103,000 | 419,165 | ||||||
Longfor Properties Co. Ltd. | 204,000 | 609,638 | ||||||
Yangtze Optical Fibre and Cable Joint Stock Ltd. Co.–REGS,–Class H(b)(c) | 60,000 | 254,353 | ||||||
Yantai Changyu Pioneer Wine Co. Ltd.–Class B | 64,900 | 164,966 | ||||||
YiChang HEC ChangJiang Pharmaceutical Co. Ltd.–REGS,–Class H(b) | 54,800 | 259,617 | ||||||
Yuzhou Properties Co. Ltd. | 845,000 | 614,283 | ||||||
YY Inc.–ADR(c) | 5,267 | 507,686 | ||||||
5,632,838 | ||||||||
Hong Kong–0.29% | ||||||||
Kingboard Laminates Holdings Ltd. | 96,000 | 128,168 | ||||||
India–11.53% | ||||||||
DCM Shriram Ltd. | 12,964 | 64,195 | ||||||
Hero MotoCorp Ltd. | 9,468 | 529,535 | ||||||
InterGlobe Aviation Ltd.–REGS(b) | 24,729 | 519,050 | ||||||
KEC International Ltd. | 94,406 | 570,938 | ||||||
NHPC Ltd. | 660,346 | 280,985 | ||||||
NMDC Ltd. | 293,897 | 547,887 | ||||||
Power Finance Corp. Ltd. | 265,111 | 348,242 | ||||||
Rural Electrification Corp. Ltd. | 208,383 | 396,779 | ||||||
Sun TV Network Ltd. | 39,856 | 522,748 | ||||||
Tata Global Beverages Ltd. | 76,950 | 341,168 | ||||||
Tata Steel Ltd. | 54,124 | 479,392 | ||||||
Vedanta Ltd. | 126,484 | 561,148 | ||||||
5,162,067 |
Shares | Value | |||||||
Malaysia–6.77% | ||||||||
AirAsia Group Bhd. | 609,600 | $ | 582,487 | |||||
Kuala Lumpur Kepong Bhd. | 85,400 | 552,904 | ||||||
Petronas Dagangan Bhd. | 31,300 | 214,540 | ||||||
PPB Group Bhd. | 45,300 | 221,703 | ||||||
Public Bank Bhd. | 95,400 | 573,659 | ||||||
Tenaga Nasional Bhd. | 120,100 | 481,480 | ||||||
Top Glove Corp. Bhd. | 166,800 | 402,573 | ||||||
3,029,346 | ||||||||
Mexico–5.47% | ||||||||
Coca-Cola FEMSA, S.A.B. de C.V.–Series L | 60,300 | 391,271 | ||||||
Gruma, S.A.B. de C.V.–Class B | 15,260 | 186,674 | ||||||
Grupo Aeroportuario del Centro Norte, S.A.B. de C.V. | 106,800 | 563,597 | ||||||
Industrias Bachoco, S.A.B. de C.V.–Series B | 36,100 | 185,271 | ||||||
Industrias Peñoles, S.A.B. de C.V. | 7,010 | 147,367 | ||||||
Megacable Holdings S.A.B. de C.V.–Series | 90,200 | 414,621 | ||||||
Wal-Mart de México, S.A.B. de C.V.–Series V | 200,600 | 558,000 | ||||||
2,446,801 | ||||||||
Poland–2.20% | ||||||||
LPP S.A. | 165 | 429,441 | ||||||
Powszechny Zaklad Ubezpieczen S.A. | 45,554 | 553,872 | ||||||
983,313 | ||||||||
Qatar–0.42% | ||||||||
Qatar Islamic Bank (S.A.Q) | 6,376 | 186,547 | ||||||
Russia–4.10% | ||||||||
LUKOIL PJSC–ADR | 9,757 | 650,198 | ||||||
Magnitogorsk Iron & Steel Works PJSC | 783,800 | 605,932 | ||||||
Novolipetsk Steel PJSC–GDR–REGS(b) | 17,448 | 446,067 | ||||||
Unipro PJSC | 3,070,000 | 135,338 | ||||||
1,837,535 | ||||||||
South Africa–10.88% | ||||||||
AECI Ltd. | 17,036 | 160,573 | ||||||
African Rainbow Minerals Ltd. | 45,685 | 373,294 | ||||||
Astral Foods Ltd. | 21,102 | 520,195 | ||||||
AVI Ltd. | 60,079 | 549,454 | ||||||
Barclays Africa Group Ltd. | 41,468 | 604,725 | ||||||
Bidvest Group Ltd. (The) | 23,931 | 468,276 | ||||||
Kumba Iron Ore Ltd. | 22,532 | 483,461 | ||||||
Liberty Holdings Ltd. | 55,324 | 588,158 | ||||||
Mondi Ltd. | 18,236 | 531,020 | ||||||
Reunert Ltd. | 54,452 | 339,532 | ||||||
Super Group Ltd.(c) | 24,341 | 72,499 | ||||||
Tsogo Sun Holdings Ltd. | 98,915 | 179,879 | ||||||
4,871,066 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Low Volatility Emerging Markets Fund
Shares | Value | |||||||
South Korea–19.76% | ||||||||
Chong Kun Dang Pharmaceutical Corp. | 4,444 | $ | 483,423 | |||||
Daewon Pharmaceutical Co., Ltd. | 8,376 | 155,897 | ||||||
Grand Korea Leisure Co., Ltd. | 23,036 | 584,225 | ||||||
Hanwha Corp. | 16,405 | 610,186 | ||||||
HITEJINRO Co., Ltd. | 29,177 | 592,706 | ||||||
Hyundai Development Co. | 13,904 | 604,041 | ||||||
Korea United Pharm., Inc. | 8,850 | 232,799 | ||||||
KT&G Corp. | 6,280 | 573,611 | ||||||
Kwang Dong Pharmaceutical Co., Ltd. | 14,396 | 123,410 | ||||||
LG Corp. | 7,461 | 563,573 | ||||||
Lotte Chemical Corp. | 315 | 121,524 | ||||||
LOTTE Fine Chemical Co., Ltd. | 6,009 | 382,579 | ||||||
LOTTE Himart Co., Ltd. | 8,918 | 619,400 | ||||||
LS Industrial Systems Co., Ltd. | 7,012 | 446,836 | ||||||
Samjin Pharmaceutical Co., Ltd. | 3,993 | 166,249 | ||||||
Samsung Electronics Co., Ltd. | 230 | 570,666 | ||||||
SK Hynix Inc. | 8,001 | 626,477 | ||||||
SK Telecom Co., Ltd. | 2,661 | 569,298 | ||||||
SL Corp. | 8,141 | 168,397 | ||||||
Woori Bank | 43,423 | 648,974 | ||||||
8,844,271 | ||||||||
Taiwan–4.92% | ||||||||
Chipbond Technology Corp. | 283,000 | 559,684 | ||||||
Chunghwa Telecom Co., Ltd. | 150,000 | 570,718 | ||||||
Powertech Technology Inc. | 192,000 | 549,598 | ||||||
St. Shine Optical Co., Ltd. | 16,000 | 430,868 | ||||||
Syncmold Enterprise Corp. | 42,000 | 91,978 | ||||||
2,202,846 | ||||||||
Thailand–7.11% | ||||||||
Advanced Info Service PCL | 96,100 | 630,928 | ||||||
Airports of Thailand PCL | 267,700 | 602,030 | ||||||
Intouch Holdings PCL | 172,222 | 312,910 |
Shares | Value | |||||||
Thailand–(continued) | ||||||||
Mega Lifesciences PCL | 305,400 | $ | 396,947 | |||||
PTT Global Chemical PCL | 102,900 | 317,681 | ||||||
Ratchaburi Electricity Generating Holding PCL | 133,300 | 220,388 | ||||||
Thai Oil PCL | 195,900 | 581,897 | ||||||
Thai Vegetable Oil PCL | 108,500 | 120,891 | ||||||
3,183,672 | ||||||||
Turkey–2.52% | ||||||||
BIM Birlesik Magazalar A.S. | 32,071 | 543,356 | ||||||
Soda Sanayii A.S. | 2 | 2 | ||||||
Tekfen Holding A.S. | 155,564 | 587,236 | ||||||
1,130,594 | ||||||||
United Arab Emirates–1.64% | ||||||||
Air Arabia PJSC | 489,452 | 162,573 | ||||||
Aldar Properties PJSC | 876,734 | 501,264 | ||||||
DAMAC Properties Dubai Co. PJSC | 94,034 | 70,916 | ||||||
734,753 | ||||||||
Total Common Stocks & Other Equity Interests |
| 42,777,007 | ||||||
Money Market Funds–3.13% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(e) | 491,401 | 491,401 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(e) | 351,000 | 351,035 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(e) | 561,602 | 561,602 | ||||||
Total Money Market Funds |
| 1,404,038 | ||||||
TOTAL INVESTMENTS IN SECURITIES–98.69% |
| 44,181,045 | ||||||
OTHER ASSETS LESS LIABILITIES–1.31% |
| 584,614 | ||||||
NET ASSETS–100.00% |
| $ | 44,765,659 |
Investment Abbreviations:
ADR | – American Depositary Receipt | |
CPO | – Certificates of Ordinary Participation | |
GDR | – Global Depositary Receipt | |
REGS | – Regulation S |
Notes to Schedule of Investments:
(a) | Each unit represents two preferred shares and one common share. |
(b) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2018 was $1,479,087, which represented 3.30% of the Fund’s Net Assets. |
(c) | Non-income producing security. |
(d) | Each CPO represents two Series A shares. |
(e) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Low Volatility Emerging Markets Fund
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2018
Industrials | 16.4 | % | ||
Consumer Staples | 13.2 | |||
Materials | 12.8 | |||
Financials | 10.1 | |||
Consumer Discretionary | 9.8 | |||
Information Technology | 9.3 | |||
Health Care | 7.3 | |||
Telecommunication Services | 4.7 | |||
Energy | 4.5 | |||
Real Estate | 4.0 | |||
Utilities | 3.5 | |||
Money Market Funds Plus Other Assets Less Liabilities | 4.4 |
Open Futures Contracts — Equity Risk(a) | ||||||||||||||||||||
Long Futures Contracts | Number of Contracts | Expiration Month | Notional Value | Value | Unrealized Appreciation (Depreciation) | |||||||||||||||
MSCI Emerging Markets Mini Index | 50 | June-2018 | $ | 2,880,500 | $ | (131,144 | ) | $ | (131,144 | ) |
(a) | Futures contracts collateralized by $130,000 cash held with Bank of America Merrill Lynch, the futures commission merchant. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Low Volatility Emerging Markets Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $37,655,908) | $ | 42,777,007 | ||
Investments in affiliated money market funds, at value (Cost $1,404,005) | 1,404,038 | |||
Deposits with brokers: | ||||
Cash collateral — exchange-traded futures contracts | 130,000 | |||
Foreign currencies, at value (Cost $1,941,308) | 1,905,634 | |||
Receivable for: |
| |||
Fund shares sold | 458,014 | |||
Dividends | 24,189 | |||
Fund expenses absorbed | 18,139 | |||
Investment for trustee deferred compensation and retirement plans | 10,630 | |||
Other assets | 41,622 | |||
Total assets | 46,769,273 | |||
Liabilities: |
| |||
Other investments: | ||||
Variation margin payable — futures contracts | 4,000 | |||
Payable for: |
| |||
Fund shares reacquired | 1,798,793 | |||
Accrued foreign taxes | 110,724 | |||
Amount due custodian | 19,711 | |||
Accrued fees to affiliates | 5,444 | |||
Accrued trustees’ and officers’ fees and benefits | 1,514 | |||
Accrued other operating expenses | 52,798 | |||
Trustee deferred compensation and retirement plans | 10,630 | |||
Total liabilities | 2,003,614 | |||
Net assets applicable to shares outstanding | $ | 44,765,659 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 36,275,154 | ||
Undistributed net investment income | 377,975 | |||
Undistributed net realized gain | 3,158,435 | |||
Net unrealized appreciation | 4,954,095 | |||
$ | 44,765,659 |
Net Assets: |
| |||
Class A | $ | 8,065,469 | ||
Class C | $ | 315,965 | ||
Class R | $ | 35,053 | ||
Class Y | $ | 2,240,729 | ||
Class R5 | $ | 8,815 | ||
Class R6 | $ | 34,099,628 | ||
Shares outstanding, no par value, |
| |||
Class A | 933,503 | |||
Class C | 36,774 | |||
Class R | 4,059 | |||
Class Y | 259,012 | |||
Class R5 | 1,019 | |||
Class R6 | 3,945,922 | |||
Class A: | ||||
Net asset value per share | $ | 8.64 | ||
Maximum offering price per share | ||||
(Net asset value of $8.64 ¸ 94.50%) | $ | 9.14 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 8.59 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 8.64 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 8.65 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 8.65 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 8.64 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Low Volatility Emerging Markets Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of foreign withholding taxes of $75,665) | $ | 734,196 | ||
Dividends from affiliated money market funds | 974 | |||
Total investment income | 735,170 | |||
Expenses: | ||||
Advisory fees | 220,060 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 40,059 | |||
Distribution fees: | ||||
Class A | 9,981 | |||
Class C | 1,642 | |||
Class R | 69 | |||
Transfer agent fees — A, C, R and Y | 11,024 | |||
Transfer agent fees — R6 | 76 | |||
Trustees’ and officers’ fees and benefits | 11,651 | |||
Registration and filing fees | 40,650 | |||
Reports to shareholders | 10,245 | |||
Professional services fees | 40,256 | |||
Other | 7,500 | |||
Total expenses | 418,008 | |||
Less: Fees waived, expenses reimbursed and expense offset arrangement(s) | (154,999 | ) | ||
Net expenses | 263,009 | |||
Net investment income | 472,161 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain from: | ||||
Investment securities (net of foreign taxes of $40,434) | 3,098,463 | |||
Foreign currencies | 42,429 | |||
Futures contracts | 80,406 | |||
3,221,298 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities (net of foreign taxes of $(25,873)) | (1,561,368 | ) | ||
Foreign currencies | (25,117 | ) | ||
Futures contracts | (142,854 | ) | ||
(1,729,339 | ) | |||
Net realized and unrealized gain | 1,491,959 | |||
Net increase in net assets resulting from operations | $ | 1,964,120 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Low Volatility Emerging Markets Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income | $ | 472,161 | $ | 972,811 | ||||
Net realized gain | 3,221,298 | 5,723,909 | ||||||
Change in net unrealized appreciation (depreciation) | (1,729,339 | ) | 1,372,754 | |||||
Net increase in net assets resulting from operations | 1,964,120 | 8,069,474 | ||||||
Distributions to shareholders from net investment income: | ||||||||
Class A | (144,942 | ) | (35,912 | ) | ||||
Class C | (4,916 | ) | (179 | ) | ||||
Class R | (429 | ) | (235 | ) | ||||
Class Y | (43,634 | ) | (29,372 | ) | ||||
Class R5 | (222 | ) | (1,859 | ) | ||||
Class R6 | (817,876 | ) | (563,343 | ) | ||||
Total distributions from net investment income | (1,012,019 | ) | (630,900 | ) | ||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | (913,293 | ) | (103,932 | ) | ||||
Class C | (42,922 | ) | (3,794 | ) | ||||
Class R | (2,990 | ) | (935 | ) | ||||
Class Y | (243,456 | ) | (72,517 | ) | ||||
Class R5 | (1,241 | ) | (4,589 | ) | ||||
Class R6 | (4,563,323 | ) | (1,390,853 | ) | ||||
Total distributions from net realized gains | (5,767,225 | ) | (1,576,620 | ) | ||||
Share transactions–net: | ||||||||
Class A | 1,363,687 | 3,026,098 | ||||||
Class C | 29,516 | 59,423 | ||||||
Class R | 14,775 | (5,494 | ) | |||||
Class Y | 632,768 | (543,569 | ) | |||||
Class R5 | — | (138,308 | ) | |||||
Class R6 | 1,352,628 | (5,053,148 | ) | |||||
Net increase (decrease) in net assets resulting from share transactions | 3,393,374 | (2,654,998 | ) | |||||
Net increase (decrease) in net assets | (1,421,750 | ) | 3,206,956 | |||||
Net assets: | ||||||||
Beginning of period | 46,187,409 | 42,980,453 | ||||||
End of period (includes undistributed net investment income of $377,975 and $917,833, respectively) | $ | 44,765,659 | $ | 46,187,409 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Low Volatility Emerging Markets Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value.
10 Invesco Low Volatility Emerging Markets Fund
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net
11 Invesco Low Volatility Emerging Markets Fund
investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
J. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are
12 Invesco Low Volatility Emerging Markets Fund
measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
K. | Futures Contracts — The Fund may enter into futures contracts to manage exposure to interest rate, equity and market price movements and/or currency risks. A futures contract is an agreement between Counterparties to purchase or sell a specified underlying security, currency or commodity (or delivery of a cash settlement price, in the case of an index future) for a fixed price at a future date. The Fund currently invests only in exchange-traded futures and they are standardized as to maturity date and underlying financial instrument. Initial margin deposits required upon entering into futures contracts are satisfied by the segregation of specific securities or cash as collateral at the futures commission merchant (broker). During the period the futures contracts are open, changes in the value of the contracts are recognized as unrealized gains or losses by recalculating the value of the contracts on a daily basis. Subsequent or variation margin payments are received or made depending upon whether unrealized gains or losses are incurred. These amounts are reflected as receivables or payables on the Statement of Assets and Liabilities. When the contracts are closed or expire, the Fund recognizes a realized gain or loss equal to the difference between the proceeds from, or cost of, the closing transaction and the Fund’s basis in the contract. The net realized gain (loss) and the change in unrealized gain (loss) on futures contracts held during the period is included on the Statement of Operations. The primary risks associated with futures contracts are market risk and the absence of a liquid secondary market. If the Fund were unable to liquidate a futures contract and/or enter into an offsetting closing transaction, the Fund would continue to be subject to market risk with respect to the value of the contracts and continue to be required to maintain the margin deposits on the futures contracts. Futures contracts have minimal Counterparty risk since the exchange’s clearinghouse, as Counterparty to all exchange-traded futures, guarantees the futures against default. Risks may exceed amounts recognized in the Statement of Assets and Liabilities. |
L. | Collateral — To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund’s practice to replace such collateral no later than the next business day. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $250 million | 0.935% | |||
Next $250 million | 0.910% | |||
Next $500 million | 0.885% | |||
Next $1.5 billion | 0.860% | |||
Next $2.5 billion | 0.835% | |||
Next $2.5 billion | 0.810% | |||
Next $2.5 billion | 0.785% | |||
Over $10 billion | 0.760% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.935%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.33%, 2.08%, 1.58%, 1.08%, 1.08% and 1.08%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $143,899 and reimbursed class level expenses of $8,182, $337, $28, $2,198 and $77 of Class A, Class C, Class R, Class Y and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
13 Invesco Low Volatility Emerging Markets Fund
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $949 in front-end sales commissions from the sale of Class A shares and $665 and $17 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
14 Invesco Low Volatility Emerging Markets Fund
During the six months ended April 30, 2018, there were transfers from Level 1 to Level 2 of $18,726,989 and from Level 2 to Level 1 of $729,333, due to foreign fair value adjustments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Brazil | $ | 2,287,805 | $ | — | $ | — | $ | 2,287,805 | ||||||||
Chile | 115,385 | — | — | 115,385 | ||||||||||||
China | 1,226,443 | 4,406,395 | — | 5,632,838 | ||||||||||||
Hong Kong | — | 128,168 | — | 128,168 | ||||||||||||
India | — | 5,162,067 | — | 5,162,067 | ||||||||||||
Malaysia | — | 3,029,346 | — | 3,029,346 | ||||||||||||
Mexico | 2,446,801 | — | — | 2,446,801 | ||||||||||||
Poland | — | 983,313 | — | 983,313 | ||||||||||||
Qatar | 186,547 | — | — | 186,547 | ||||||||||||
Russia | — | 1,837,535 | — | 1,837,535 | ||||||||||||
South Africa | 1,837,686 | 3,033,380 | — | 4,871,066 | ||||||||||||
South Korea | 569,298 | 8,274,973 | — | 8,844,271 | ||||||||||||
Taiwan | — | 2,202,846 | — | 2,202,846 | ||||||||||||
Thailand | 602,030 | 2,581,642 | — | 3,183,672 | ||||||||||||
Turkey | — | 1,130,594 | — | 1,130,594 | ||||||||||||
United Arab Emirates | 734,753 | — | — | 734,753 | ||||||||||||
Money Market Funds | 1,404,038 | — | — | 1,404,038 | ||||||||||||
Total Investments in Securities | 11,410,786 | 32,770,259 | — | 44,181,045 | ||||||||||||
Other Investments — Liabilities* | ||||||||||||||||
Futures Contracts | (131,144 | ) | — | — | (131,144 | ) | ||||||||||
Total Investments | $ | 11,279,642 | $ | 32,770,259 | $ | — | $ | 44,049,901 |
* | Unrealized appreciation (depreciation). |
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Statement of Assets and Liabilities.
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2018:
Value | ||||
Derivative Liabilities | Equity Risk | |||
Unrealized depreciation on futures contracts — Exchange-Traded(a) | $ | (131,144 | ) | |
Derivatives not subject to master netting agreements | 131,144 | |||
Total Derivative Liabilities subject to master netting agreements | $ | — |
(a) | The daily variation margin receivable (payable) at period-end is recorded in the Statement of Assets and Liabilities. |
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Statement of Operations | ||||
Equity Risk | ||||
Realized Gain: | ||||
Futures contracts | $ | 80,406 | ||
Change in Net Unrealized Appreciation (Depreciation): | ||||
Futures contracts | (142,854 | ) | ||
Total | $ | (62,448 | ) |
15 Invesco Low Volatility Emerging Markets Fund
The table below summarizes the average notional value of futures contracts outstanding during the period.
Futures Contracts | ||||
Average notional value | $ | 1,313,188 |
NOTE 5—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $278.
NOTE 6—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Obligations under the deferred compensation plan represent unsecured claims against the general assets of the Fund.
NOTE 7—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 8—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund does not have a capital loss carryforward as of October 31, 2017.
NOTE 9—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $12,404,661 and $15,449,338, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 7,259,197 | ||
Aggregate unrealized (depreciation) of investments | (2,199,697 | ) | ||
Net unrealized appreciation of investments | $ | 5,059,500 |
Cost of investments for tax purposes is $38,990,401.
16 Invesco Low Volatility Emerging Markets Fund
NOTE 10—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 348,391 | $ | 3,184,797 | 1,066,732 | $ | 9,578,200 | ||||||||||
Class C | 7,189 | 65,045 | 38,430 | 348,928 | ||||||||||||
Class R | 2,082 | 18,710 | 459 | 4,242 | ||||||||||||
Class Y | 62,534 | 574,156 | 199,976 | 1,764,679 | ||||||||||||
Class R6 | 109,266 | 958,204 | 1,113,879 | 9,802,466 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 124,439 | 1,036,572 | 9,568 | 76,541 | ||||||||||||
Class C | 5,593 | 46,480 | 456 | 3,652 | ||||||||||||
Class R | 243 | 2,025 | 98 | 786 | ||||||||||||
Class Y | 33,652 | 280,324 | 5,460 | 43,731 | ||||||||||||
Class R6 | 646,603 | 5,379,736 | 243,469 | 1,947,749 | ||||||||||||
Reacquired: | ||||||||||||||||
Class A | (308,032 | ) | (2,857,682 | ) | (726,230 | ) | (6,628,643 | ) | ||||||||
Class C | (9,504 | ) | (82,009 | ) | (34,600 | ) | (293,157 | ) | ||||||||
Class R | (688 | ) | (5,960 | ) | (1,163 | ) | (10,522 | ) | ||||||||
Class Y | (24,285 | ) | (221,712 | ) | (247,850 | ) | (2,351,979 | ) | ||||||||
Class R5 | — | — | (13,982 | ) | (138,308 | ) | ||||||||||
Class R6 | (562,968 | ) | (4,985,312 | ) | (1,877,418 | ) | (16,803,363 | ) | ||||||||
Net increase (decrease) in share activity | 434,515 | $ | 3,393,374 | (222,716 | ) | $ | (2,654,998 | ) |
(a) | There is an entity that is a record owner of more than 5% of the outstanding shares of the Fund and owns 6% of the outstanding shares of the Fund. IDI has an agreement with this entity to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to this entity, which is considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by this entity are also owned beneficially. |
In addition, 76% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser. |
17 Invesco Low Volatility Emerging Markets Fund
NOTE 11—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 9.72 | $ | 0.08 | $ | 0.25 | $ | 0.33 | $ | (0.19 | ) | $ | (1.22 | ) | $ | (1.41 | ) | $ | 8.64 | 3.95 | % | $ | 8,065 | 1.31 | %(d) | 2.14 | %(d) | 1.81 | %(d) | 27 | % | |||||||||||||||||||||||||
Year ended 10/31/17 | 8.64 | 0.17 | 1.32 | 1.49 | (0.10 | ) | (0.31 | ) | (0.41 | ) | 9.72 | 18.29 | 7,471 | 1.39 | 2.09 | 1.89 | 54 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 8.08 | 0.17 | 0.46 | 0.63 | (0.07 | ) | — | (0.07 | ) | 8.64 | 7.98 | 3,617 | 1.72 | 2.27 | 2.08 | 63 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.32 | 0.14 | (1.91 | ) | (1.77 | ) | (0.35 | ) | (0.12 | ) | (0.47 | ) | 8.08 | (17.67 | ) | 1,531 | 1.72 | 7.99 | 1.52 | 105 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(e) | 10.00 | 0.15 | 0.17 | 0.32 | — | — | — | 10.32 | 3.20 | 1,705 | 1.71 | (f) | 10.36 | (f) | 1.69 | (f) | 38 | |||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.65 | 0.05 | 0.25 | 0.30 | (0.14 | ) | (1.22 | ) | (1.36 | ) | 8.59 | 3.56 | 316 | 2.06 | (d) | 2.89 | (d) | 1.06 | (d) | 27 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 8.55 | 0.10 | 1.32 | 1.42 | (0.01 | ) | (0.31 | ) | (0.32 | ) | 9.65 | 17.38 | 323 | 2.14 | 2.84 | 1.14 | 54 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 8.00 | 0.11 | 0.45 | 0.56 | (0.01 | ) | — | (0.01 | ) | 8.55 | 7.08 | 250 | 2.47 | 3.02 | 1.33 | 63 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.26 | 0.07 | (1.90 | ) | (1.83 | ) | (0.31 | ) | (0.12 | ) | (0.43 | ) | 8.00 | (18.29 | ) | 41 | 2.47 | 8.74 | 0.77 | 105 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(e) | 10.00 | 0.09 | 0.17 | 0.26 | — | — | — | 10.26 | 2.60 | 57 | 2.46 | (f) | 11.11 | (f) | 0.94 | (f) | 38 | |||||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.70 | 0.07 | 0.26 | 0.33 | (0.17 | ) | (1.22 | ) | (1.39 | ) | 8.64 | 3.97 | 35 | 1.56 | (d) | 2.39 | (d) | 1.56 | (d) | 27 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 8.62 | 0.14 | 1.32 | 1.46 | (0.07 | ) | (0.31 | ) | (0.38 | ) | 9.70 | 17.91 | 23 | 1.64 | 2.34 | 1.64 | 54 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 8.06 | 0.15 | 0.46 | 0.61 | (0.05 | ) | — | (0.05 | ) | 8.62 | 7.68 | 26 | 1.97 | 2.52 | 1.83 | 63 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.30 | 0.12 | (1.90 | ) | (1.78 | ) | (0.34 | ) | (0.12 | ) | (0.46 | ) | 8.06 | (17.81 | ) | 23 | 1.97 | 8.24 | 1.27 | 105 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(e) | 10.00 | 0.13 | 0.17 | 0.30 | — | — | — | 10.30 | 3.00 | 14 | 1.96 | (f) | 10.61 | (f) | 1.44 | (f) | 38 | |||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.74 | 0.09 | 0.26 | 0.35 | (0.22 | ) | (1.22 | ) | (1.44 | ) | 8.65 | 4.12 | 2,241 | 1.06 | (d) | 1.89 | (d) | 2.06 | (d) | 27 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 8.66 | 0.19 | 1.32 | 1.51 | (0.12 | ) | (0.31 | ) | (0.43 | ) | 9.74 | 18.51 | 1,823 | 1.14 | 1.84 | 2.14 | 54 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 8.10 | 0.19 | 0.46 | 0.65 | (0.09 | ) | — | (0.09 | ) | 8.66 | 8.25 | 1,987 | 1.47 | 2.02 | 2.33 | 63 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.35 | 0.16 | (1.92 | ) | (1.76 | ) | (0.37 | ) | (0.12 | ) | (0.49 | ) | 8.10 | (17.50 | ) | 1,337 | 1.47 | 7.74 | 1.77 | 105 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(e) | 10.00 | 0.18 | 0.17 | 0.35 | — | — | — | 10.35 | 3.50 | 1,411 | 1.46 | (f) | 10.11 | (f) | 1.94 | (f) | 38 | |||||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.74 | 0.09 | 0.26 | 0.35 | (0.22 | ) | (1.22 | ) | (1.44 | ) | 8.65 | 4.12 | 9 | 1.07 | (d) | 1.68 | (d) | 2.05 | (d) | 27 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 8.66 | 0.19 | 1.32 | 1.51 | (0.12 | ) | (0.31 | ) | (0.43 | ) | 9.74 | 18.51 | 10 | 1.14 | 1.65 | 2.14 | 54 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 8.10 | 0.18 | 0.47 | 0.65 | (0.09 | ) | — | (0.09 | ) | 8.66 | 8.25 | 130 | 1.47 | 1.87 | 2.33 | 63 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.35 | 0.16 | (1.92 | ) | (1.76 | ) | (0.37 | ) | (0.12 | ) | (0.49 | ) | 8.10 | (17.50 | ) | 122 | 1.47 | 7.64 | 1.77 | 105 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(e) | 10.00 | 0.18 | 0.17 | 0.35 | — | — | — | 10.35 | 3.50 | 477 | 1.46 | (f) | 10.06 | (f) | 1.94 | (f) | 38 | |||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.74 | 0.09 | 0.25 | 0.34 | (0.22 | ) | (1.22 | ) | (1.44 | ) | 8.64 | 4.02 | 34,100 | 1.07 | (d) | 1.68 | (d) | 2.05 | (d) | 27 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 8.65 | 0.19 | 1.33 | 1.52 | (0.12 | ) | (0.31 | ) | (0.43 | ) | 9.74 | 18.65 | 36,536 | 1.14 | 1.65 | 2.14 | 54 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 8.10 | 0.19 | 0.45 | 0.64 | (0.09 | ) | — | (0.09 | ) | 8.65 | 8.12 | 36,970 | 1.47 | 1.87 | 2.33 | 63 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.35 | 0.16 | (1.92 | ) | (1.76 | ) | (0.37 | ) | (0.12 | ) | (0.49 | ) | 8.10 | (17.50 | ) | 122 | 1.47 | 7.64 | 1.77 | 105 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/14(e) | 10.00 | 0.18 | 0.17 | 0.35 | — | — | — | 10.35 | 3.50 | 155 | 1.46 | (f) | 10.06 | (f) | 1.94 | (f) | 38 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $8,051, $331, $28, $2,163, $9, and $36,880 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Commencement date of December 17, 2013. |
(f) | Annualized. |
18 Invesco Low Volatility Emerging Markets Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning | ACTUAL | HYPOTHETICAL (5% annual return before | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 1,039.50 | $ | 6.62 | $ | 1,018.30 | $ | 6.56 | 1.31 | % | ||||||||||||
C | 1,000.00 | 1,035.60 | 10.40 | 1,014.58 | 10.29 | 2.06 | ||||||||||||||||||
R | 1,000.00 | 1,039.70 | 7.89 | 1,017.06 | 7.80 | 1.56 | ||||||||||||||||||
Y | 1,000.00 | 1,041.20 | 5.36 | 1,019.54 | 5.31 | 1.06 | ||||||||||||||||||
R5 | 1,000.00 | 1,041.20 | 5.42 | 1,019.49 | 5.36 | 1.07 | ||||||||||||||||||
R6 | 1,000.00 | 1,041.30 | 5.42 | 1,019.49 | 5.36 | 1.07 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
19 Invesco Low Volatility Emerging Markets Fund
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Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
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Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. LVEM-SAR-1 06112018 0904
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Semiannual Report to Shareholders
| April 30, 2018 | |||
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Invesco Macro Allocation Strategy Fund
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Nasdaq: | ||||
A: GMSDX ∎ C: GMSEX ∎ R: GMSJX ∎ Y: GMSHX ∎ R5: GMSKX ∎ R6: GMSLX |
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2
| Fund Performance
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4
| Letters to Shareholders
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5
| Consolidated Schedule of Investments
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9
| Consolidated Financial Statements
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11
| Notes to Consolidated Financial Statements
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20
| Financial Highlights
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21 | Fund Expenses
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For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 3.60 | % | ||
Class C Shares | 3.18 | |||
Class R Shares | 3.49 | |||
Class Y Shares | 3.80 | |||
Class R5 Shares | 3.69 | |||
Class R6 Shares | 3.80 | |||
Bloomberg Barclays 3-Month Treasury Bellwether Index▼ (Broad Market/Style-Specific Index) | 0.69 | |||
Lipper Absolute Return Funds Index∎ (Peer Group Index) | 0.90 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. | ||||
The Bloomberg Barclays 3-Month Treasury Bellwether Index measures the performance of Treasury bills with maturities of less than three months. The Lipper Absolute Return Funds Index is an unmanaged index considered representative of absolute return funds tracked by Lipper. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
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For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Macro Allocation Strategy Fund
Average Annual Total Returns |
| |||
As of 4/30/18, including maximum applicable sales charges
| ||||
Class A Shares |
| |||
Inception | 3.45 | % | ||
5 Years | 2.55 | |||
1 Year | 1.27 | |||
Class C Shares |
| |||
Inception | 3.74 | % | ||
5 Years | 2.97 | |||
1 Year | 5.40 | |||
Class R Shares |
| |||
Inception | 4.28 | % | ||
5 Years | 3.51 | |||
1 Year | 6.94 | |||
Class Y Shares |
| |||
Inception (9/26/12) | 4.80 | % | ||
5 Years | 4.02 | |||
1 Year | 7.59 | |||
Class R5 Shares |
| |||
Inception | 4.79 | % | ||
5 Years | 4.02 | |||
1 Year | 7.48 | |||
Class R6 Shares |
| |||
Inception | 4.78 | % | ||
5 Years | 4.00 | |||
1 Year | 7.48 |
On August 28, 2013, Class H1 shares converted to Class Y shares.
Class A shares incepted on August 28, 2013. Performance shown prior to that date is that of Class H1 shares and includes the 12b-1 fees applicable to Class H1 shares.
Class C shares incepted on August 28, 2013. Performance shown prior to that date is that of Class H1 shares and includes the 12b-1 fees applicable to Class H1 shares.
Class R shares incepted on August 28, 2013. Performance shown prior to that date is that of Class H1 shares and includes the 12b-1 fees applicable to Class H1 shares.
Class R5 shares incepted on August 28, 2013. Performance shown prior to that date is that of Class H1 shares and includes the 12b-1 fees applicable to Class H1 shares.
Class R6 shares incepted on August 28, 2013. Performance shown prior to that date is that of Class H1 shares and includes the 12b-1 fees applicable to Class H1 shares.
Average Annual Total Returns |
| |||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||
Class A Shares |
| |||
Inception | 3.10 | % | ||
5 Years | 2.48 | |||
1 Year | -0.45 | |||
Class C Shares |
| |||
Inception | 3.42 | % | ||
5 Years | 2.91 | |||
1 Year | 3.60 | |||
Class R Shares |
| |||
Inception | 3.94 | % | ||
5 Years | 3.43 | |||
1 Year | 5.14 | |||
Class Y Shares |
| |||
Inception (9/26/12) | 4.45 | % | ||
5 Years | 3.93 | |||
1 Year | 5.57 | |||
Class R5 Shares |
| |||
Inception | 4.47 | % | ||
5 Years | 3.95 | |||
1 Year | 5.69 | |||
Class R6 Shares |
| |||
Inception | 4.43 | % | ||
5 Years | 3.91 | |||
1 Year | 5.58 |
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.46%, 2.21%, 1.71%, 1.21%, 1.21% and 1.21%, respectively.1,2 The total annual Fund operating expense ratio set forth in the most recent Fund
prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 2.31%, 3.06%, 2.56%, 2.06%, 1.98% and 1.98%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least February 28, 2019. See current prospectus for more information. |
2 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco Macro Allocation Strategy Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Macro Allocation Strategy Fund
Consolidated Schedule of Investments
April 30, 2018
(Unaudited)
Interest Rate | Maturity Date | Principal Amount | Value | |||||||||||||
U.S. Treasury Securities–31.59% |
| |||||||||||||||
U.S. Treasury Bills–12.87%(a)(b) | ||||||||||||||||
U.S. Treasury Bills | 1.56 | % | 07/05/2018 | $ | 635,000 | $ | 633,005 | |||||||||
U.S. Treasury Bills | 1.67 | % | 08/09/2018 | 4,880,000 | 4,855,009 | |||||||||||
5,488,014 | ||||||||||||||||
U.S. Treasury Notes–18.72%(c) | ||||||||||||||||
U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate + 0.17%) | 2.01 | % | 07/31/2018 | 2,500,000 | 2,501,424 | |||||||||||
U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate) | 1.84 | % | 01/31/2020 | 3,100,000 | 3,099,864 | |||||||||||
U.S. Treasury Floating Rate Notes (3 mo. U.S. Treasury Bill Money Market Yield Rate + 0.03%) | 1.87 | % | 04/30/2020 | 2,380,000 | 2,380,378 | |||||||||||
7,981,666 | ||||||||||||||||
Total U.S. Treasury Securities (Cost $13,470,565) | 13,469,680 | |||||||||||||||
Shares | ||||||||||||||||
Money Market Funds–66.68% |
| |||||||||||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(d) | 11,561,476 | 11,561,476 | ||||||||||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(d) | 5,022,912 | 5,023,415 | ||||||||||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(d) | 8,038,258 | 8,038,258 | ||||||||||||||
STIC (Global Series) PLC–U.S. Dollar Liquidity Portfolio (Ireland)–Institutional Class, 1.84%(d) | 3,802,765 | 3,802,765 | ||||||||||||||
Total Money Market Funds (Cost $28,426,230) | 28,425,914 | |||||||||||||||
TOTAL INVESTMENTS IN SECURITIES–98,27% (Cost $41,896,795) | 41,895,594 | |||||||||||||||
OTHER ASSETS LESS LIABILITIES–1.73% | 735,462 | |||||||||||||||
NET ASSETS–100.00% | $ | 42,631,056 |
Open Futures Contracts | ||||||||||||||||||||
Long Futures Contracts | Number of Contracts | Expiration Month | Notional Value | Value | Unrealized Appreciation (Depreciation) | |||||||||||||||
Brent Crude | 28 | August-2018 | $ | 2,076,760 | $ | 12,796 | $ | 12,796 | ||||||||||||
Cocoa | 52 | July-2018 | 1,469,000 | 227,316 | 227,316 | |||||||||||||||
Corn | 1 | July-2018 | 20,038 | 1,234 | 1,234 | |||||||||||||||
Cotton No. 2 | 9 | December-2018 | 354,510 | 15,172 | 15,172 | |||||||||||||||
Gas Oil Intercontinental Exchange | 1 | June-2018 | 65,050 | 9,847 | 9,847 | |||||||||||||||
Gasoline Reformulated Blendstock Oxygenate Blending | 6 | June-2018 | 536,962 | 18,563 | 18,563 | |||||||||||||||
Globex Gasoline Reformulated Blendstock Oxygenate Blending | 20 | June-2018 | 1,789,872 | 66,898 | 66,898 | |||||||||||||||
Lean Hogs | 33 | December-2018 | 784,410 | 11,223 | 11,223 | |||||||||||||||
New York Harbor Ultra-Low-Sulfur Diesel | 22 | June-2018 | 1,985,953 | 212,238 | 212,238 | |||||||||||||||
Soybean Oil | 1 | July-2018 | 18,372 | (1,654 | ) | (1,654 | ) | |||||||||||||
Soybeans | 25 | July-2018 | 1,310,625 | 12,399 | 12,399 | |||||||||||||||
Wheat | 13 | July-2018 | 331,825 | (5,268 | ) | (5,268 | ) | |||||||||||||
WTI Crude | 23 | October-2018 | 1,543,070 | 132,093 | 132,093 | |||||||||||||||
Subtotal — Commodity Risk | 712,857 | 712,857 | ||||||||||||||||||
Dow Jones EURO STOXX 50 Index | 16 | June-2018 | 671,288 | 29,078 | 29,078 | |||||||||||||||
E-Mini Russell 2000 Index | 21 | June-2018 | �� | 1,620,990 | (61,755 | ) | (61,755 | ) | ||||||||||||
E-Mini S&P 500 Index | 13 | June-2018 | 1,720,550 | (52,839 | ) | (52,839 | ) | |||||||||||||
FTSE 100 Index | 7 | June-2018 | 718,861 | 38,711 | 38,711 | |||||||||||||||
Hang Seng Index | 10 | May-2018 | 1,953,533 | 27,542 | 27,542 | |||||||||||||||
Mini MSCI Emerging Markets Index | 27 | June-2018 | 1,555,470 | (10,389 | ) | (10,389 | ) | |||||||||||||
S&P/TSX 60 Index | 17 | June-2018 | 2,436,442 | 66,378 | 66,378 | |||||||||||||||
Tokyo Stock Price Index | 27 | June-2018 | 4,395,033 | 173,981 | 173,981 | |||||||||||||||
Subtotal — Equity Risk | $ | 210,707 | $ | 210,707 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
5 Invesco Macro Allocation Strategy Fund
Open Futures Contracts–(continued) | ||||||||||||||||||||
Long Futures Contracts | Number of Contracts | Expiration Month | Notional Value | Value | Unrealized Appreciation (Depreciation) | |||||||||||||||
Australia 10 Year Bonds | 113 | June-2018 | $ | 10,877,977 | $ | (143,529 | ) | $ | (143,529 | ) | ||||||||||
Canada 10 Year Bonds | 27 | June-2018 | 2,764,781 | (35,850 | ) | (35,850 | ) | |||||||||||||
Euro Bonds | 26 | June-2018 | 4,984,468 | (21,218 | ) | (21,218 | ) | |||||||||||||
Long Gilt | 11 | June-2018 | 1,851,334 | (8,987 | ) | (8,987 | ) | |||||||||||||
Subtotal — Interest Rate Risk | (209,584 | ) | (209,584 | ) | ||||||||||||||||
Subtotal — Long Futures Contracts | 713,980 | 713,980 | ||||||||||||||||||
Short Futures Contracts | ||||||||||||||||||||
Coffee | 7 | July-2018 | (322,350 | ) | (9,084 | ) | (9,084 | ) | ||||||||||||
Subtotal — Commodity Risk | (9,084 | ) | (9,084 | ) | ||||||||||||||||
U.S. Treasury Long Bonds | 3 | June-2018 | (431,531 | ) | 1,399 | 1,399 | ||||||||||||||
Subtotal — Interest Rate Risk | 1,399 | 1,399 | ||||||||||||||||||
Total Short Futures Contracts | (7,685 | ) | (7,685 | ) | ||||||||||||||||
Total Futures Contracts | $ | 706,295 | $ | 706,295 |
Open Over-The-Counter Total Return Swap Agreements(e)(f) | ||||||||||||||||||||||||||||||||||||
Counterparty | Pay/ Receive | Reference Entity(g) | Fixed Rate | Payment Frequency | Number of Contracts | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation (Depreciation) | ||||||||||||||||||||||||||
Barclays Bank PLC | Receive | Barclays Live Cattle Roll Yield Excess Return Index | 0.47 | % | Monthly | 12,080 | January-2019 | $ | 1,439,378 | $ | — | $ | 26,598 | $ | 26,598 | |||||||||||||||||||||
Barclays Bank PLC | Receive | Barclays Soybean Meal S2 Nearby Excess Return Index | 0.30 | Monthly | 1,470 | March-2019 | 1,687,034 | — | 52,113 | 52,113 | ||||||||||||||||||||||||||
Goldman Sachs International | Receive | Enhanced Strategy AB31 on the S&P GSCI Cotton Excess Return Index | 0.45 | Monthly | 37,000 | October-2018 | 1,656,389 | — | 7,195 | 7,195 | ||||||||||||||||||||||||||
Goldman Sachs International | Receive | Enhanced Strategy AB44 on the S&P GSCI Corn Excess Return Index | 0.30 | Monthly | 34,700 | September-2018 | 932,963 | — | 4,092 | 4,092 | ||||||||||||||||||||||||||
Goldman Sachs International | Pay | Enhanced Strategy AB141 on the S&P GSCI Sugar Excess Return Index | 0.15 | Monthly | 180 | October-2018 | 32,200 | — | 2.036 | 2,036 | ||||||||||||||||||||||||||
JPMorgan Chase Bank, N.A. | Receive | J.P. Morgan Contag Beta Gas Oil Excess Return Index | 0.25 | Monthly | 7,680 | April-2019 | 2,077,058 | — | 22,594 | 22,594 | ||||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Pay | S&P GSCI Aluminum Dynamic Roll Index Excess Return | 0.38 | Monthly | 8,900 | April-2019 | 1,106,641 | — | 53,679 | 53,679 | ||||||||||||||||||||||||||
Subtotal — Appreciation | — | 168,307 | 168,307 | |||||||||||||||||||||||||||||||||
Barclays Bank PLC | Receive | Barclays Commodity Strategy 1452 Excess Return Index | 0.33 | Monthly | 500 | October-2018 | 279,662 | — | (4,288 | ) | (4,288 | ) | ||||||||||||||||||||||||
Canadian Imperial Bank of Commerce | Receive | CIBC Silver Index | 0.11 | Monthly | 6,600 | February-2019 | 623,776 | — | (16,045 | ) | (16,045 | ) | ||||||||||||||||||||||||
JPMorgan Chase Bank, N.A. | Receive | S&P GSCI Gold Index Excess Return | 0.09 | Monthly | 9,400 | October-2018 | 1,001,934 | — | (3,633 | ) | (3,633 | ) | ||||||||||||||||||||||||
Merrill Lynch International | Receive | Merrill Lynch Gold Excess Return Index | 0.14 | Monthly | 8,370 | June-2018 | 1,393,107 | — | 0 | 0 | ||||||||||||||||||||||||||
Merrill Lynch International | Receive | MLCX Natural Gas Annual Excess Return Index | 0.25 | Monthly | 20,400 | November-2018 | 855,455 | — | 0 | 0 | ||||||||||||||||||||||||||
Merrill Lynch International | Receive | MLCXLXAE Excess Return Index | 0.25 | Monthly | 3,320 | March-2019 | 917,449 | — | 0 | 0 | ||||||||||||||||||||||||||
Morgan Stanley Capital Services LLC | Receive | MS Soybean Oil Dynamic Roll Index | 0.30 | Monthly | 3,800 | April-2019 | 547,475 | — | (6,246 | ) | (6,246 | ) | ||||||||||||||||||||||||
Subtotal — Depreciation | — | (30,212 | ) | (30,212 | ) | |||||||||||||||||||||||||||||||
Total — Open Over-The-Counter Total Return Swap Agreements — Commodity Risk |
| — | $ | 138,095 | $ | 138,095 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
6 Invesco Macro Allocation Strategy Fund
Notes to Schedule of Investments:
(a) | Security traded on a discount basis. The interest rate shown represents the discount rate at the time of purchase by the Fund. |
(b) | All or a portion of the value was pledged as collateral to cover margin requirements for open futures contracts. See Note 1L. |
(c) | Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on April 30, 2018. |
(d) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
(e) | The Fund receives or pays payments based on any positive or negative return on the Reference Entity, respectively. |
(f) | Open Over-The-Counter total return swap agreements are collateralized by cash held with Counterparties in the amount of $590,000. |
(g) | The table below includes additional information regarding the underlying components of certain reference entities that are not publically available. |
Reference Entity Components | ||||||
Reference Entity | Underlying Components | Percentage | ||||
Barclays Live Cattle Roll Yield Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Live Cattle | 100.00 | % | ||||
Barclays Soybean Meal S2 Nearby Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Soybean Meal | 100.00 | % | ||||
Enhanced Strategy AB31 on the S&P GSCI Cotton Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Cotton No.2 | 100.00 | % | ||||
Enhanced Strategy AB44 on the S&P GSCI Corn Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Corn | 100.00 | % | ||||
Enhanced Strategy AB141 on the S&P GSCI Sugar Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Sugar | 100.00 | % | ||||
J.P. Morgan Contag Beta Gas Oil Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Gas Oil | 100.00 | % | ||||
S&P GSCI Aluminum Dynamic Roll Index Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Aluminum | 100.00 | % | ||||
Barclays Commodity Strategy 1452 Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Copper | 100.00 | % | ||||
CIBC Silver Index |
| |||||
Long Futures Contracts | ||||||
Silver | 100.00 | % | ||||
S&P GSCI Gold Index Excess Return |
| |||||
Long Futures Contracts | ||||||
Gold | 100.00 | % | ||||
Merrill Lynch Gold Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Gold | 100.00 | % |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
7 Invesco Macro Allocation Strategy Fund
Reference Entity Components–(continued) | ||||||
Reference Entity | Underlying Components | Percentage | ||||
MLCX Natural Gas Annual Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Natural Gas | 100.00 | % | ||||
MLCXLXAE Excess Return Index |
| |||||
Long Futures Contracts | ||||||
Zinc | 100.00 | % | ||||
MS Soybean Oil Dynamic Roll Index |
| |||||
Long Futures Contracts | ||||||
Soybean Oil | 100.00 | % |
Target Risk Allocation and Notional Asset Weights
By asset class, based on Net Assets as of April 30, 2018
Asset Class | Risk Allocation* | % of Total Net Assets** | ||||||
Equities | 30.14 | % | 34.66 | |||||
Fixed Income | -0.23 | % | 48.40 | |||||
Commodities | 70.09 | % | 55.84 | |||||
Total | 100.00 | % | 138.90 |
* | Reflects the risk that each asset class is expected to contribute to the overall risk of the Fund as measured by standard deviation and estimates of risk based on the historical data. Standard deviation measures the annualized fluctuations (volatility) of monthly returns. |
** | Proprietary models determine the Notional Asset Weights necessary to achieve the Target Risk Allocations. Total Notional Asset Weight greater than 100% is achieved through derivatives and other instruments that create leverage. |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
8 Invesco Macro Allocation Strategy Fund
Consolidated Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $13,470,565) | $ | 13,469,680 | ||
Investments in affiliated money market funds, at value | 28,425,914 | |||
Other investments: | ||||
Variation margin receivable — futures contracts | 93,414 | |||
Swaps receivable — OTC | 2,169 | |||
Unrealized appreciation on swap agreements — OTC | 168,307 | |||
Cash | 101,561 | |||
Deposits with brokers: | ||||
Cash collateral — OTC derivatives | 590,000 | |||
Receivable for: | ||||
Fund shares sold | 42,522 | |||
Dividends and interest | 38,702 | |||
Investment for trustee deferred compensation and retirement plans | 18,686 | |||
Other assets | 27,531 | |||
Total assets | 42,978,486 | |||
Liabilities: |
| |||
Other investments: | ||||
Swaps payable — OTC | 68,093 | |||
Unrealized depreciation on swap agreements — OTC | 30,212 | |||
Payable for: |
| |||
Fund shares reacquired | 151,345 | |||
Accrued fees to affiliates | 22,661 | |||
Accrued trustees’ and officers’ fees and benefits | 1,501 | |||
Accrued other operating expenses | 53,913 | |||
Trustee deferred compensation and retirement plans | 19,705 | |||
Total liabilities | 347,430 | |||
Net assets applicable to shares outstanding | $ | 42,631,056 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 41,501,128 | ||
Undistributed net investment income | 24,701 | |||
Undistributed net realized gain | 262,038 | |||
Net unrealized appreciation | 843,189 | |||
$ | 42,631,056 |
Net Assets: |
| |||
Class A | $ | 5,161,243 | ||
Class C | $ | 7,597,973 | ||
Class R | $ | 71,893 | ||
Class Y | $ | 29,355,697 | ||
Class R5 | $ | 9,107 | ||
Class R6 | $ | 435,143 | ||
Shares outstanding, no par value, |
| |||
Class A | 542,520 | |||
Class C | 804,725 | |||
Class R | 7,560 | |||
Class Y | 3,069,020 | |||
Class R5 | 952 | |||
Class R6 | 45,531 | |||
Class A: | ||||
Net asset value per share | $ | 9.51 | ||
Maximum offering price per share | ||||
(Net asset value of $9.51 ¸ 94.50%) | $ | 10.06 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 9.44 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 9.51 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 9.57 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 9.57 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 9.56 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
9 Invesco Macro Allocation Strategy Fund
Consolidated Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends from affiliated money market funds | $ | 197,837 | ||
Interest | 96,165 | |||
Total investment income | 294,002 | |||
Expenses: | ||||
Advisory fees | 237,034 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 5,439 | |||
Distribution fees: | ||||
Class A | 6,305 | |||
Class C | 37,814 | |||
Class R | 146 | |||
Transfer agent fees — A, C, R and Y | 24,569 | |||
Transfer agent fees — R5 | 3 | |||
Transfer agent fees — R6 | 115 | |||
Trustees’ and officers’ fees and benefits | 11,299 | |||
Registration and filing fees | 43,976 | |||
Reports to shareholders | 8,566 | |||
Professional services fees | 41,391 | |||
Other | 9,554 | |||
Total expenses | 451,006 | |||
Less: Fees waived, expenses reimbursed and expense offset arrangement(s) | (167,961 | ) | ||
Net expenses | 283,045 | |||
Net investment income | 10,957 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | (181 | ) | ||
Foreign currencies | 23,643 | |||
Futures contracts | 2,163,480 | |||
Swap agreements | (168,220 | ) | ||
2,018,722 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | (8,124 | ) | ||
Futures contracts | (655,282 | ) | ||
Swap agreements | 167,007 | |||
(496,399 | ) | |||
Net realized and unrealized gain | 1,522,323 | |||
Net increase in net assets resulting from operations | $ | 1,533,280 |
See accompanying Notes to Consolidated Financial Statements which are an integral part of the financial statements.
10 Invesco Macro Allocation Strategy Fund
Consolidated Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income (loss) | $ | 10,957 | $ | (259,121 | ) | |||
Net realized gain | 2,018,722 | 2,189,791 | ||||||
Change in net unrealized appreciation (depreciation) | (496,399 | ) | 1,068,041 | |||||
Net increase in net assets resulting from operations | 1,533,280 | 2,998,711 | ||||||
Distributions to shareholders from net investment income: | ||||||||
Class A | — | (772,744 | ) | |||||
Class C | — | (831,705 | ) | |||||
Class R | — | (5,116 | ) | |||||
Class Y | — | (4,694,776 | ) | |||||
Class R5 | — | (1,244 | ) | |||||
Class R6 | — | (30,239 | ) | |||||
Total distributions from net investment income | — | (6,335,824 | ) | |||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | (212,490 | ) | — | |||||
Class C | (323,365 | ) | — | |||||
Class R | (2,400 | ) | — | |||||
Class Y | (1,337,441 | ) | — | |||||
Class R5 | (404 | ) | — | |||||
Class R6 | (15,400 | ) | — | |||||
Total distributions from net realized gains | (1,891,500 | ) | — | |||||
Share transactions–net: | ||||||||
Class A | 554,759 | (789,636 | ) | |||||
Class C | 284,120 | 283,439 | ||||||
Class R | 18,056 | 14,526 | ||||||
Class Y | (1,068,179 | ) | (4,893,657 | ) | ||||
Class R6 | 92,345 | 121,068 | ||||||
Net increase (decrease) in net assets resulting from share transactions | (118,899 | ) | (5,264,260 | ) | ||||
Net increase (decrease) in net assets | (477,119 | ) | (8,601,373 | ) | ||||
Net assets: | ||||||||
Beginning of period | 43,108,175 | 51,709,548 | ||||||
End of period (includes undistributed net investment income (loss) of $24,701 and $13,744, respectively) | $ | 42,631,056 | $ | 43,108,175 |
Notes to Consolidated Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Macro Allocation Strategy Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these consolidated financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund will seek to gain exposure to the commodity markets primarily through investments in the Invesco Cayman Commodity Fund V Ltd. (the “Subsidiary”), a wholly-owned subsidiary of the Fund organized under the laws of the Cayman Islands. The Subsidiary was organized by the Fund to invest in commodity-linked derivatives and other securities that may provide leveraged and non-leveraged exposure to commodities. The Fund may invest up to 25% of its total assets in the Subsidiary.
The Fund’s investment objective is to seek a positive absolute return over a complete economic and market cycle.
11 Invesco Macro Allocation Strategy Fund
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waiver shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its consolidated financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the consolidated financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
12 Invesco Macro Allocation Strategy Fund
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Consolidated Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Consolidated Statement of Operations and the Consolidated Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Consolidated Statement of Operations and the Consolidated Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Consolidated Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the consolidated financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Subsidiary is classified as a controlled foreign corporation under Subchapter N of the Internal Revenue Code. Therefore, the Fund is required to increase its taxable income by its share of the Subsidiary’s income. Net investment losses of the Subsidiary cannot be deducted by the Fund in the current period nor carried forward to offset taxable income in future periods.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The financial statements are prepared on a consolidated basis in conformity with accounting principles generally accepted in the United States of America (“GAAP”), which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. The accompanying financial statements reflect the financial position of the Fund and its Subsidiary and the results of operations on a consolidated basis. All inter-company accounts and transactions have been eliminated in consolidation. |
In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the consolidated financial statements are released to print.
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust, and under the Subsidiary’s organizational documents, the directors and officers of the Subsidiary, are indemnified against certain liabilities that may arise out of the performance of their duties to the Fund and/or the Subsidiary, respectively. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Structured Securities — The Fund may invest in structured securities. Structured securities are a type of derivative security whose value is determined by reference to changes in the value of underlying securities, currencies, interest rates, commodities, indices or other financial indicators (“reference instruments”). Most structured securities are fixed-income securities that have maturities of three years or less. Structured securities may be positively or negatively indexed (i.e., their principal value or interest rates may increase or decrease if the underlying reference instrument appreciates) and may have return characteristics similar to direct investments in the underlying reference instrument. |
Structured securities may entail a greater degree of market risk than other types of debt securities because the investor bears the risk of the reference instruments. In addition to the credit risk of structured securities and the normal risks of price changes in response to changes in interest rates, the principal amount of structured notes or indexed securities may decrease as a result of changes in the value of the underlying reference instruments. Changes in the daily value of structured securities are recorded as unrealized gains (losses) in the Consolidated Statement
13 Invesco Macro Allocation Strategy Fund
of Operations. When the structured securities mature or are sold, the Fund recognizes a realized gain (loss) on the Consolidated Statement of Operations.
J. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Consolidated Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Consolidated Statement of Operations.
K. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Consolidated Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Consolidated Statement of Assets and Liabilities.
L. | Futures Contracts — The Fund may enter into futures contracts to equitize the Fund’s cash holdings or to manage exposure to interest rate, equity, commodity and market price movements and/or currency risks. A futures contract is an agreement between Counterparties to purchase or sell a specified underlying security, currency or commodity (or delivery of a cash settlement price, in the case of an index future) for a fixed price at a future date. The Fund currently invests only in exchange-traded futures and they are standardized as to maturity date and underlying financial instrument. Initial margin deposits required upon entering into futures contracts are satisfied by the segregation of specific securities or cash as collateral at the futures commission merchant (broker). During the period the futures contracts are open, changes in the value of the contracts are recognized as unrealized gains or losses by recalculating the value of the contracts on a daily basis. Subsequent or variation margin payments are received or made depending upon whether unrealized gains or losses are incurred. These amounts are reflected as receivables or payables on the Consolidated Statement of Assets and Liabilities. When the contracts are closed or expire, the Fund recognizes a realized gain or loss equal to the difference between the proceeds from, or cost of, the closing transaction and the Fund’s basis in the contract. The net realized gain (loss) and the change in unrealized gain (loss) on futures contracts held during the period is included on the Consolidated Statement of Operations. The primary risks associated with futures contracts are market risk and the absence of a liquid secondary market. If the Fund were unable to liquidate a futures contract and/or enter into an offsetting closing transaction, the Fund would continue to be subject to market risk with respect to the value of the contracts and continue to be required to maintain the margin deposits on the futures contracts. Futures contracts have minimal Counterparty risk since the exchange’s clearinghouse, as Counterparty to all exchange-traded futures, guarantees the futures against default. Risks may exceed amounts recognized in the Consolidated Statement of Assets and Liabilities. |
M. | Swap Agreements — The Fund may enter into various swap transactions, including interest rate, total return, index, currency and credit default swap contracts (“CDS”) for investment purposes or to manage interest rate, currency, commodity or credit risk. Such transactions are agreements between two parties (“Counterparties”). These agreements may contain among other conditions, events of default and termination events, and various covenants and representations such as provisions that require the Fund to maintain a pre-determined level of net assets, and/or provide limits regarding the decline of the Fund’s NAV over specific periods of time. If the Fund were to trigger such provisions and have open derivative positions at that time, the Counterparty may be able to terminate such agreement and request immediate payment in an amount equal to the net liability positions, if any. |
Interest rate, total return, index, and currency swap agreements are two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a notional amount, i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate or return of an underlying asset, in a particular foreign currency, or in a “basket” of securities representing a particular index. At the maturity date, a net cash flow is exchanged where the total return is equivalent to the return of the underlying reference less a financing rate, if any. As a receiver, the Fund would receive payments based on any positive total return and would owe payments in the event of a negative total return. As the payer, the Fund would owe payments on any net positive total return, and would receive payment in the event of a negative total return.
14 Invesco Macro Allocation Strategy Fund
Changes in the value of swap agreements are recognized as unrealized gains (losses) in the Consolidated Statement of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Consolidated Statement of Assets and Liabilities and may be referred to as upfront payments. The Fund accrues for the fixed payment stream and amortizes upfront payments, if any, on swap agreements on a daily basis with the net amount, recorded as a component of realized gain (loss) on the Consolidated Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Consolidated Statement of Operations. The Fund segregates cash or liquid securities having a value at least equal to the amount of the potential obligation of a Fund under any swap transaction. Cash held as collateral is recorded as deposits with brokers on the Consolidated Statement of Assets and Liabilities. Entering into these agreements involves, to varying degrees, lack of liquidity and elements of credit, market, and Counterparty risk in excess of amounts recognized on the Consolidated Statement of Assets and Liabilities. Such risks involve the possibility that a swap is difficult to sell or liquidate; the Counterparty does not honor its obligations under the agreement and unfavorable interest rates and market fluctuations. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund’s exposure is unlimited.
N. | Other Risks — The Fund will seek to gain exposure to commodity markets primarily through an investment in the Subsidiary and through investments in exchange-traded funds and commodity-linked derivatives. The Subsidiary, unlike the Fund, may invest without limitation in commodities, commodity-linked derivatives and other securities, such as exchange-traded and commodity-linked notes, that may provide leveraged and non-leveraged exposure to commodity markets. The Fund is indirectly exposed to the risks associated with the Subsidiary’s investments. |
O. | Leverage Risk — Leverage exists when the Fund can lose more than it originally invests because it purchases or sells an instrument or enters into a transaction without investing an amount equal to the full economic exposure of the instrument or transaction. |
P. | Collateral — To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund’s practice to replace such collateral no later than the next business day. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser less the amount paid by the Subsidiary to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $250 million | 1.10% | |||
Next $250 million | 1.08% | |||
Next $500 million | 1.05% | |||
Next $1.5 billion | 1.03% | |||
Next $2.5 billion | 1.00% | |||
Next $2.5 billion | 0.98% | |||
Next $2.5 billion | 0.95% | |||
Over $10 billion | 0.93% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 1.10%.
The Subsidiary has entered into a separate contract with the Adviser whereby the Adviser provides investment advisory and other services to the Subsidiary. In consideration of these services, the Subsidiary pays an advisory fee to the Adviser based on the annual rate of the Subsidiary’s average daily net assets as set forth in the table above.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.44%, 2.19%, 1.69%, 1.19%, 1.19% and 1.19%, respectively, of average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Acquired Fund Fees and Expenses are not operating expenses of a Fund directly, but are fees and expenses, including management fees, of the investment companies in which a Fund invests. As a result, the total annual fund operating expenses after expense reimbursement may exceed the expense limits above. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
15 Invesco Macro Allocation Strategy Fund
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $143,275 and reimbursed class level expenses of $2,888, $4,330, $33, $17,196, $3 and $115 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Consolidated Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Consolidated Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Consolidated Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $512 in front-end sales commissions from the sale of Class A shares and $583 from Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the consolidated financial statements may materially differ from the value received upon actual sale of those investments.
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The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
U.S. Treasury Securities | $ | — | $ | 13,469,680 | $ | — | $ | 13,469,680 | ||||||||
Money Market Funds | 28,425,914 | — | — | 28,425,914 | ||||||||||||
Total Investments in Securities | 28,425,914 | 13,469,680 | — | 41,895,594 | ||||||||||||
Other Investments — Assets* | ||||||||||||||||
Futures Contracts | 1,056,868 | — | — | 1,056,868 | ||||||||||||
Swap Agreements | — | 168,307 | — | 168,307 | ||||||||||||
Other Investments — Liabilities* | ||||||||||||||||
Futures Contracts | (350,573 | ) | — | — | (350,573 | ) | ||||||||||
Swap Agreements | — | (30,212 | ) | — | (30,212 | ) | ||||||||||
Total Other Investments | 706,295 | 138,095 | 844,390 | |||||||||||||
Total Investments | $ | 29,132,209 | $ | 13,607,775 | $ | — | $ | 42,739,984 |
* | Unrealized appreciation (depreciation). |
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Consolidated Statement of Assets and Liabilities.
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2018:
Derivative Assets
| Value | |||||||||||||||
Commodity Risk | Equity Risk | Interest Rate Risk | Total | |||||||||||||
Unrealized appreciation on futures contracts — Exchange-Traded(a) | $ | 719,779 | $ | 335,690 | $ | 1,399 | $ | 1,056,868 | ||||||||
Unrealized appreciation on swap agreements — OTC | 168,307 | — | — | 168,307 | ||||||||||||
Total Derivative Assets | 888,086 | 335,690 | 1,399 | 1,225,175 | ||||||||||||
Derivatives not subject to master netting agreements | (719,779 | ) | (335,690 | ) | (1,399 | ) | (1,056,868 | ) | ||||||||
Total Derivative Assets subject to master netting agreements | $ | 168,307 | $ | — | $ | — | $ | 168,307 | ||||||||
Derivative Liabilities
| Value | |||||||||||||||
Commodity Risk | Equity Risk | Interest Rate Risk | Total | |||||||||||||
Unrealized depreciation on futures contracts — Exchange-Traded(a) | $ | (16,006 | ) | $ | (124,983 | ) | $ | (209,584 | ) | $ | (350,573 | ) | ||||
Unrealized depreciation on swap agreements — OTC | (30,212 | ) | — | — | (30,212 | ) | ||||||||||
Total Derivative Liabilities | (46,218 | ) | (124,983 | ) | (209,584 | ) | (380,785 | ) | ||||||||
Derivatives not subject to master netting agreements | 16,006 | 124,983 | 209,584 | 350,573 | ||||||||||||
Total Derivative Liabilities subject to master netting agreements | $ | (30,212 | ) | $ | — | $ | — | $ | (30,212 | ) |
(a) | The daily variation margin receivable at period-end is recorded in the Consolidated Statement of Assets and Liabilities. |
17 Invesco Macro Allocation Strategy Fund
Offsetting Assets and Liabilities
The table below reflects the Fund’s exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of April 30, 2018.
Financial Derivative Assets | Financial Derivative Liabilities | Collateral | ||||||||||||||||||||||
Swap | Swap | Net Value of | (Received)/Pledged | Net | ||||||||||||||||||||
Counterparty | Agreements | Agreements | Derivatives | Non-Cash | Cash | Amount(a) | ||||||||||||||||||
Subsidiary | ||||||||||||||||||||||||
Barclays Bank PLC | $ | 78,711 | $ | (4,812 | ) | $ | 73,899 | $ | — | $ | — | $ | 73,899 | |||||||||||
Canadian Imperial Bank of Commerce | — | (16,082 | ) | (16,082 | ) | — | — | (16,082 | ) | |||||||||||||||
Goldman Sachs International | 13,323 | (41,518 | ) | (28,195 | ) | — | 28,195 | — | ||||||||||||||||
JPMorgan Chase Bank, N.A. | 22,594 | (3,738 | ) | 18,856 | — | — | 18,856 | |||||||||||||||||
Merrill Lynch International | 2,169 | (25,709 | ) | (23,540 | ) | — | 20,000 | (3,540 | ) | |||||||||||||||
Morgan Stanley Capital Services LLC | 53,679 | (6,446 | ) | 47,233 | — | — | 47,233 | |||||||||||||||||
Total | $ | 170,476 | $ | (98,305 | ) | $ | 72,171 | $ | — | $ | 48,195 | $ | 120,366 |
(a) | The Fund and the Subsidiary are recognized as separate legal entities and as such are subject to separate netting arrangements with the Counterparty. |
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Consolidated Statement of Operations | ||||||||||||||||
Commodity Risk | Equity Risk | Interest Rate Risk | Total | |||||||||||||
Realized Gain (Loss): | ||||||||||||||||
Futures contracts | $ | 1,177,586 | $ | 1,159,111 | $ | (173,217 | ) | $ | 2,163,480 | |||||||
Swap agreements | (168,220 | ) | — | — | (168,220 | ) | ||||||||||
Change in Net Unrealized Appreciation (Depreciation): | ||||||||||||||||
Futures contracts | 314,223 | (798,271 | ) | (171,234 | ) | (655,282 | ) | |||||||||
Swap agreements | 167,007 | — | — | 167,007 | ||||||||||||
Total | $ | 1,490,596 | $ | 360,840 | $ | (344,451 | ) | $ | 1,506,985 |
The table below summarizes the average notional value of futures contracts and swap agreements outstanding during the period.
Futures Contracts | Swap Agreements | |||||||
Average notional value | $ | 40,748,508 | $ | 8,155,597 |
NOTE 5—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $121.
NOTE 6—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 7—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Consolidated Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
18 Invesco Macro Allocation Strategy Fund
NOTE 8—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund had a capital loss carryforward as of October 31, 2017, as follows:
Capital Loss Carryforward* | ||||||||||||
Expiration | Short-Term | Long-Term | Total | |||||||||
Not subject to expriation | $ | 835,885 | $ | — | $ | 835,885 |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
NOTE 9—Investment Transactions
The aggregate amount of long-term U.S. Treasury obligations purchased and sold by the Fund during the six months ended April 30, 2018 was $5,480,000 and $5,020,000, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 352,997 | ||
Aggregate unrealized (depreciation) of investments | (383,788 | ) | ||
Net unrealized appreciation (depreciation) of investments | $ | (30,791 | ) |
Cost of investments for tax purposes is $42,770,775.
NOTE 10—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 96,080 | $ | 911,922 | 262,417 | $ | 2,502,087 | ||||||||||
Class C | 105,805 | 991,825 | 318,952 | 2,978,514 | ||||||||||||
Class R | 1,725 | 16,060 | 1,140 | 10,600 | ||||||||||||
Class Y | 545,797 | 5,203,711 | 2,196,857 | 20,535,016 | ||||||||||||
Class R6 | 11,831 | 112,568 | 24,701 | 230,307 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 20,650 | 191,636 | 75,549 | 698,067 | ||||||||||||
Class C | 31,175 | 287,742 | 68,885 | 638,566 | ||||||||||||
Class R | 215 | 1,996 | 423 | 3,926 | ||||||||||||
Class Y | 103,763 | 967,067 | 392,090 | 3,630,752 | ||||||||||||
Class R6 | 1,610 | 14,997 | 3,135 | 28,995 | ||||||||||||
Reacquired: | ||||||||||||||||
Class A | (57,931 | ) | (548,799 | ) | (426,075 | ) | (3,989,790 | ) | ||||||||
Class C | (105,505 | ) | (995,447 | ) | (353,558 | ) | (3,333,641 | ) | ||||||||
Class Y | (760,381 | ) | (7,238,957 | ) | (3,102,594 | ) | (29,059,425 | ) | ||||||||
Class R6 | (3,714 | ) | (35,220 | ) | (14,790 | ) | (138,234 | ) | ||||||||
Net increase (decrease) in share activity | (8,880 | ) | $ | (118,899 | ) | (552,868 | ) | $ | (5,264,260 | ) |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 75% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
19 Invesco Macro Allocation Strategy Fund
NOTE 11—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 9.60 | $ | 0.00 | $ | 0.33 | $ | 0.33 | $ | — | $ | (0.42 | ) | $ | (0.42 | ) | $ | 9.51 | 3.60 | % | $ | 5,161 | 1.36 | %(d) | 2.14 | %(d) | 0.00 | %(d) | 64 | % | ||||||||||||||||||||||||||
Year ended 10/31/17 | 10.26 | (0.06 | ) | 0.68 | 0.62 | (1.28 | ) | — | (1.28 | ) | 9.60 | 6.55 | 4,645 | 1.41 | 2.30 | (0.66 | ) | 25 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.70 | (0.13 | ) | 0.91 | 0.78 | (0.22 | ) | — | (0.22 | ) | 10.26 | 8.21 | 5,865 | 1.63 | 2.19 | (1.31 | ) | 75 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.02 | (0.16 | ) | 0.18 | 0.02 | (0.15 | ) | (0.19 | ) | (0.34 | ) | 9.70 | 0.18 | 7,418 | 1.70 | (e) | 2.03 | (e) | (1.64 | )(e) | 0 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.78 | (0.17 | ) | 0.09 | (0.08 | ) | — | (0.68 | ) | (0.68 | ) | 10.02 | (0.64 | ) | 6,996 | 1.73 | 2.06 | (1.68 | ) | 0 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13(f) | 10.52 | (0.04 | ) | 0.30 | 0.26 | — | — | — | 10.78 | 2.47 | 607 | 1.99 | (g) | 2.04 | (g) | (1.92 | )(g) | 0 | ||||||||||||||||||||||||||||||||||||||
Class C |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.57 | (0.04 | ) | 0.33 | 0.29 | — | (0.42 | ) | (0.42 | ) | 9.44 | 3.18 | 7,598 | 2.11 | (d) | 2.89 | (d) | (0.75 | )(d) | 64 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.20 | (0.13 | ) | 0.69 | 0.56 | (1.19 | ) | — | (1.19 | ) | 9.57 | 5.90 | 7,398 | 2.16 | 3.05 | (1.41 | ) | 25 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.62 | (0.20 | ) | 0.90 | 0.70 | (0.12 | ) | — | (0.12 | ) | 10.20 | 7.41 | 7,540 | 2.38 | 2.94 | (2.06 | ) | 75 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 9.94 | (0.24 | ) | 0.18 | (0.06 | ) | (0.07 | ) | (0.19 | ) | (0.26 | ) | 9.62 | (0.63 | ) | 8,155 | 2.45 | (e) | 2.78 | (e) | (2.39 | )(e) | 0 | |||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.78 | (0.24 | ) | 0.08 | (0.16 | ) | — | (0.68 | ) | (0.68 | ) | 9.94 | (1.42 | ) | 12,136 | 2.48 | 2.81 | (2.43 | ) | 0 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13(f) | 10.52 | (0.05 | ) | 0.31 | 0.26 | — | — | — | 10.78 | 2.47 | 818 | 2.74 | (g) | 2.79 | (g) | (2.67 | )(g) | 0 | ||||||||||||||||||||||||||||||||||||||
Class R |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.61 | (0.01 | ) | 0.33 | 0.32 | — | (0.42 | ) | (0.42 | ) | 9.51 | 3.49 | 72 | 1.61 | (d) | 2.39 | (d) | (0.25 | )(d) | 64 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.25 | (0.09 | ) | 0.70 | 0.61 | (1.25 | ) | — | (1.25 | ) | 9.61 | 6.42 | 54 | 1.66 | 2.55 | (0.91 | ) | 25 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.69 | (0.15 | ) | 0.90 | 0.75 | (0.19 | ) | — | (0.19 | ) | 10.25 | 7.86 | 42 | 1.88 | 2.44 | (1.56 | ) | 75 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.00 | (0.19 | ) | 0.20 | 0.01 | (0.13 | ) | (0.19 | ) | (0.32 | ) | 9.69 | 0.00 | 24 | 1.95 | (e) | 2.28 | (e) | (1.89 | )(e) | 0 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.78 | (0.19 | ) | 0.09 | (0.10 | ) | — | (0.68 | ) | (0.68 | ) | 10.00 | (0.83 | ) | 24 | 1.98 | 2.31 | (1.93 | ) | 0 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13(f) | 10.52 | (0.04 | ) | 0.30 | 0.26 | — | — | — | 10.78 | 2.47 | 10 | 2.24 | (g) | 2.29 | (g) | (2.17 | )(g) | 0 | ||||||||||||||||||||||||||||||||||||||
Class Y |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.64 | 0.01 | 0.34 | 0.35 | — | (0.42 | ) | (0.42 | ) | 9.57 | 3.80 | 29,356 | 1.11 | (d) | 1.89 | (d) | 0.25 | (d) | 64 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.29 | (0.04 | ) | 0.70 | 0.66 | (1.31 | ) | — | (1.31 | ) | 9.64 | 6.93 | 30,657 | 1.16 | 2.05 | (0.41 | ) | 25 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.73 | (0.10 | ) | 0.91 | 0.81 | (0.25 | ) | — | (0.25 | ) | 10.29 | 8.51 | 38,019 | 1.38 | 1.94 | (1.06 | ) | 75 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.05 | (0.14 | ) | 0.19 | 0.05 | (0.18 | ) | (0.19 | ) | (0.37 | ) | 9.73 | 0.44 | 47,740 | 1.45 | (e) | 1.78 | (e) | (1.39 | )(e) | 0 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.79 | (0.14 | ) | 0.08 | (0.06 | ) | — | (0.68 | ) | (0.68 | ) | 10.05 | (0.44 | ) | 36,645 | 1.48 | 1.81 | (1.43 | ) | 0 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 9.91 | (0.19 | ) | 1.07 | 0.88 | — | — | — | 10.79 | 8.88 | 6,972 | 1.82 | 1.87 | (1.75 | ) | 0 | ||||||||||||||||||||||||||||||||||||||||
Class R5 |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.65 | 0.00 | 0.34 | 0.34 | — | (0.42 | ) | (0.42 | ) | 9.57 | 3.69 | 9 | 1.11 | (d) | 1.83 | (d) | 0.25 | (d) | 64 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.30 | (0.04 | ) | 0.70 | 0.66 | (1.31 | ) | — | (1.31 | ) | 9.65 | 6.93 | 9 | 1.15 | 1.97 | (0.40 | ) | 25 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.74 | (0.10 | ) | 0.91 | 0.81 | (0.25 | ) | — | (0.25 | ) | 10.30 | 8.50 | 10 | 1.38 | 1.83 | (1.06 | ) | 75 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.06 | (0.14 | ) | 0.19 | 0.05 | (0.18 | ) | (0.19 | ) | (0.37 | ) | 9.74 | 0.44 | 9 | 1.45 | (e) | 1.65 | (e) | (1.39 | )(e) | 0 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.79 | (0.14 | ) | 0.09 | (0.05 | ) | — | (0.68 | ) | (0.68 | ) | 10.06 | (0.34 | ) | 10 | 1.48 | 1.69 | (1.43 | ) | 0 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13(f) | 10.52 | (0.03 | ) | 0.30 | 0.27 | — | — | — | 10.79 | 2.57 | 10 | 1.75 | (g) | 1.80 | (g) | (1.68 | )(g) | 0 | ||||||||||||||||||||||||||||||||||||||
Class R6 |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 9.63 | 0.01 | 0.34 | 0.35 | — | (0.42 | ) | (0.42 | ) | 9.56 | 3.80 | 435 | 1.11 | (d) | 1.83 | (d) | 0.25 | (d) | 64 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.29 | (0.04 | ) | 0.69 | 0.65 | (1.31 | ) | — | (1.31 | ) | 9.63 | 6.83 | 345 | 1.15 | 1.97 | (0.40 | ) | 25 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.73 | (0.10 | ) | 0.91 | 0.81 | (0.25 | ) | — | (0.25 | ) | 10.29 | 8.51 | 234 | 1.38 | 1.83 | (1.06 | ) | 75 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.05 | (0.14 | ) | 0.19 | 0.05 | (0.18 | ) | (0.19 | ) | (0.37 | ) | 9.73 | 0.44 | 100,759 | 1.45 | (e) | 1.65 | (e) | (1.39 | )(e) | 0 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.80 | (0.14 | ) | 0.07 | (0.07 | ) | — | (0.68 | ) | (0.68 | ) | 10.05 | (0.53 | ) | 112,019 | 1.48 | 1.69 | (1.43 | ) | 0 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/13(f) | 10.52 | (0.03 | ) | 0.31 | 0.28 | — | — | — | 10.80 | 2.66 | 109,848 | 1.71 | (g) | 1.76 | (g) | (1.64 | )(g) | 0 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $5,086, $7,626, $59, $30,281, $9 and $394 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | In addition to the fees and expenses which the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of the underlying funds in which the Fund invests. Because the underlying funds have varied expenses and fee levels and the Fund may own different proportions at different times, the amount of fees and expenses incurred indirectly by the Fund will vary. Estimated underlying fund expenses are not expenses that are incurred directly by the Fund. They are expenses that are incurred directly by the underlying funds and are deducted from the value of the funds the Fund invests in. The effect of the estimated underlying fund expenses that the Fund bears indirectly is included in the Fund’s total return. Estimated acquired fund fees from underlying funds were 0.11%. |
(f) | Commencement date of August 28, 2013 for Class A, Class C, Class R, Class R5 and Class R6 shares, respectively. |
(g) | Annualized. |
20 Invesco Macro Allocation Strategy Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
ACTUAL | HYPOTHETICAL (5% annual return before | Annualized Expense Ratio | ||||||||||||||||||||||
Class | Beginning Account Value (11/01/17) | Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||
A | $ | 1,000.00 | $ | 1,036.00 | $ | 6.87 | $ | 1,018.05 | $ | 6.80 | 1.36 | % | ||||||||||||
C | 1,000.00 | 1,031.80 | 10.63 | 1,014.33 | 10.54 | 2.11 | ||||||||||||||||||
R | 1,000.00 | 1,034.90 | 8.12 | 1,016.81 | 8.05 | 1.61 | ||||||||||||||||||
Y | 1,000.00 | 1,038.00 | 5.61 | 1,019.29 | 5.56 | 1.11 | ||||||||||||||||||
R5 | 1,000.00 | 1,036.90 | 5.61 | 1,019.29 | 5.56 | 1.11 | ||||||||||||||||||
R6 | 1,000.00 | 1,038.00 | 5.61 | 1,019.29 | 5.56 | 1.11 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
21 Invesco Macro Allocation Strategy Fund
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Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
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Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. MAS-SAR-1 06132018 1129
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco MLP Fund
| ||||
Nasdaq: | ||||
A: ILPAX ∎ C: ILPCX ∎ R: ILPRX ∎ Y: ILPYX ∎ R5: ILPFX ∎ R6: ILPQX |
| ||||
2
| Fund Performance
| |||
4
| Letters to Shareholders
| |||
5
| Schedule of Investments
| |||
6
| Financial Statements
| |||
8
| Notes to Financial Statements
| |||
15
| Financial Highlights
| |||
21
| Fund Expenses
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 1.75 | % | ||
Class C Shares | 1.17 | |||
Class R Shares | 1.62 | |||
Class Y Shares | 1.69 | |||
Class R5 Shares | 1.88 | |||
Class R6 Shares | 1.88 | |||
S&P 500 Index▼ (Broad Market Index) | 3.82 | |||
Alerian MLP Index▼ (Style-Specific Index) | -0.73 | |||
Lipper Energy MLP Funds Index∎ (Peer Group Index) | -1.80 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
|
The S&P 500® Index is an unmanaged index considered representative of the US stock market.
The Alerian MLP Index is designed to capture the performance of energy master limited partnerships (MLPs).
The Lipper Energy MLP Funds Index is an unmanaged index considered representative of energy MLP funds tracked by Lipper.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco MLP Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
| ||||||
Class A Shares |
| |||||
Inception (8/29/14) | -12.51 | % | ||||
1 Year | -15.61 | |||||
Class C Shares |
| |||||
Inception (8/29/14) | -11.86 | % | ||||
1 Year | -12.28 | |||||
Class R Shares |
| |||||
Inception (8/29/14) | -11.37 | % | ||||
1 Year | -10.96 | |||||
Class Y Shares |
| |||||
Inception (8/29/14) | -10.93 | % | ||||
1 Year | -10.64 | |||||
Class R5 Shares |
| |||||
Inception (8/29/14) | -10.93 | % | ||||
1 Year | -10.50 | |||||
Class R6 Shares |
| |||||
Inception (8/29/14) | -10.93 | % | ||||
1 Year | -10.50 |
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 2.10%, 2.85%, 2.35%, 1.85%, 1.85% and 1.85%, respectively.1 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 5.70%, 6.45%, 5.95%, 5.45%, 5.37% and 5.37%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (8/29/14) | -14.58 | % | ||||
1 Year | -23.52 | |||||
Class C Shares |
| |||||
Inception (8/29/14) | -13.89 | % | ||||
1 Year | -20.35 | |||||
Class R Shares |
| |||||
Inception (8/29/14) | -13.45 | % | ||||
1 Year | -19.29 | |||||
Class Y Shares |
| |||||
Inception (8/29/14) | -13.01 | % | ||||
1 Year | -18.87 | |||||
Class R5 Shares |
| |||||
Inception (8/29/14) | -13.01 | % | ||||
1 Year | -18.88 | |||||
Class R6 Shares |
| |||||
Inception (8/29/14) | -13.01 | % | ||||
1 Year | -18.87 |
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 class shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least February 28, 2019. See current prospectus for more information. |
3 Invesco MLP Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including performance, holdings and portfolio manager commentaries. You can access information about |
your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to consider-ing environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco MLP Fund
Schedule of Investments(a)
April 30, 2018
(Unaudited)
Units | Value | |||||||
Master Limited Partnerships–90.53% |
| |||||||
Gathering & Processing MLP–14.87% | ||||||||
Antero Midstream Partners L.P. | 11,327 | $ | 303,677 | |||||
DCP Midstream, L.P. | 11,558 | 424,872 | ||||||
Enable Midstream Partners, L.P. | 2,752 | 39,326 | ||||||
EnLink Midstream Partners, L.P. | 15,823 | 231,016 | ||||||
EQT Midstream Partners L.P. | 2,815 | 158,372 | ||||||
Rice Midstream Partners L.P. | 5,340 | 98,149 | ||||||
Western Gas Partners, L.P. | 7,342 | 352,856 | ||||||
1,608,268 | ||||||||
General Partner (MLP)–1.44% | ||||||||
Energy Transfer Equity, L.P. | 9,898 | 156,388 | ||||||
Marine–1.94% | ||||||||
Teekay LNG Partners LP (Bermuda) | 11,486 | 209,619 | ||||||
Midstream Diversified–11.46% | ||||||||
Energy Transfer Partners, L.P. | 68,779 | 1,239,398 | ||||||
Natural Gas Pipelines & Storage–2.80% | ||||||||
Cheniere Energy Partners, L.P. | 3,025 | 94,562 | ||||||
Tallgrass Energy Partners L.P. | 3,363 | 138,589 | ||||||
TC Pipelines, L.P. | 1,990 | 69,829 | ||||||
302,980 | ||||||||
Pipelines & Midstream Diversified–28.88% | ||||||||
Enbridge Energy Partners, L.P. | 15,773 | 166,878 | ||||||
Enterprise Products Partners L.P. | 53,108 | 1,425,419 | ||||||
Plains All American Pipeline, L.P. | 36,213 | 851,368 | ||||||
Williams Partners L.P. | 18,668 | 679,515 | ||||||
3,123,180 | ||||||||
Refined Products Pipelines & Terminals–27.08% | ||||||||
Andeavor Logistics L.P. | 8,116 | 344,443 | ||||||
Buckeye Partners, L.P. | 6,890 | 286,280 | ||||||
Genesis Energy, L.P. | 11,641 | 243,879 |
Units | Value | |||||||
Refined Products Pipelines & Terminals–(continued) | ||||||||
Magellan Midstream Partners, L.P. | 12,622 | $ | 830,906 | |||||
MPLX L.P. | 25,922 | 915,824 | ||||||
Phillips 66 Partners L.P. | 3,058 | 151,616 | ||||||
Valero Energy Partners L.P. | 3,940 | 155,354 | ||||||
2,928,302 | ||||||||
Refinery Logistics–2.06% | ||||||||
Shell Midstream Partners, L.P. | 10,306 | 222,507 | ||||||
Total Master Limited Partnerships |
| 9,790,642 | ||||||
Shares | ||||||||
Common Stocks–6.62% |
| |||||||
Gathering & Processing MLP–1.45% | ||||||||
Targa Resources Corp. | 3,345 | 157,115 | ||||||
General Partner (C-Corp.)–2.95% | ||||||||
ONEOK, Inc. | 5,298 | 319,046 | ||||||
Global Infrastructure–2.22% | ||||||||
Cheniere Energy, Inc.(b) | 4,120 | 239,619 | ||||||
Total Common Stocks |
| 715,780 | ||||||
Money Market Funds–1.56% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(c) | 59,075 | 59,075 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(c) | 42,185 | 42,190 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(c) | 67,515 | 67,515 | ||||||
Total Money Market Funds |
| 168,780 | ||||||
TOTAL INVESTMENTS IN SECURITIES–98.71% | 10,675,202 | |||||||
OTHER ASSETS LESS LIABILITIES–1.29% | 139,140 | |||||||
NET ASSETS–100.00% | $ | 10,814,342 |
Notes to Schedule of Investments:
(a) | Sector classifications used in this report are generally accordingly to the Energy MLP Classification Standard, which was developed by and is the exclusive property and service mark of Alerian. |
(b) | Non-income producing security. |
(c) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
Portfolio Composition
By MLP Sector, based on Net Assets
as of April 30, 2018
Pipelines & Midstream Diversified | 28.9 | % | ||
Refined Products Pipelines & Terminals | 27.1 | |||
Gathering & Processing MLP | 16.3 | |||
Midstream Diversified | 11.5 | |||
General Partner (C-Corp.) | 3.0 | |||
Natural Gas Pipelines & Storage | 2.8 | |||
Global Infrastructure | 2.2 | |||
Refinery Logistics | 2.1 | |||
Marine | 1.9 | |||
General Partner (MLP) | 1.4 | |||
Money Market Funds Plus Other Assets Less Liabilities | 2.8 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco MLP Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: | ||||
Investments in securities, at value (Cost $10,892,533) | $ | 10,506,422 | ||
Investments in affiliated money market funds, at value (Cost $168,776) | 168,780 | |||
Receivable for: | ||||
Investments sold | 245,476 | |||
Fund shares sold | 34,841 | |||
Dividends | 69,547 | |||
Fund expenses absorbed | 125,566 | |||
Deferred tax asset, net | 0 | |||
Other assets | 27,475 | |||
Total assets | 11,178,107 | |||
Liabilities: | ||||
Payable for: | ||||
Investments purchased | 155,245 | |||
Fund shares reacquired | 8,945 | |||
Accrued fees to affiliates | 10,410 | |||
Accrued trustees’ and officers’ fees and benefits | 2,800 | |||
Accrued other operating expenses | 186,365 | |||
Total liabilities | 363,765 | |||
Net assets applicable to shares outstanding | $ | 10,814,342 | ||
Net assets consist of: | ||||
Shares of beneficial interest | $ | 14,518,528 | ||
Undistributed net investment income (loss), net of taxes | (1,779,021 | ) | ||
Undistributed net realized gain (loss), net of taxes | (1,539,058 | ) | ||
Net unrealized appreciation (depreciation), net of taxes | (386,107 | ) | ||
$ | 10,814,342 |
Net Assets: | ||||
Class A | $ | 4,241,096 | ||
Class C | $ | 1,027,921 | ||
Class R | $ | 399,766 | ||
Class Y | $ | 5,134,769 | ||
Class R5 | $ | 5,395 | ||
Class R6 | $ | 5,395 | ||
Shares outstanding, no par value, |
| |||
Class A | 786,903 | |||
Class C | 190,953 | |||
Class R | 74,189 | |||
Class Y | 952,536 | |||
Class R5 | 1,001 | |||
Class R6 | 1,001 | |||
Class A: | ||||
Net asset value per share | $ | 5.39 | ||
Maximum offering price per share | ||||
(Net asset value of $5.39 ¸ 94.50%) | $ | 5.70 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 5.38 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 5.39 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 5.39 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 5.39 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 5.39 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco MLP Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of return of capital distributions of $388,231) | $ | 15,344 | ||
Dividends from affiliated money market funds | 991 | |||
Total investment income | 16,335 | |||
Expenses: | ||||
Advisory fees | 52,687 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 3,575 | |||
Distribution fees: | ||||
Class A | 5,165 | |||
Class C | 5,254 | |||
Class R | 920 | |||
Transfer agent fees — A, C, R and Y | 9,476 | |||
Transfer agent fees — R5 | 3 | |||
Transfer agent fees — R6 | 3 | |||
Trustees’ and officers’ fees and benefits | 12,325 | |||
Registration and filing fees | 39,878 | |||
Reports to shareholders | 7,904 | |||
Professional services fees | 128,249 | |||
Taxes | 1,450 | |||
Other | 4,500 | |||
Total expenses, before waivers and taxes | 296,184 | |||
Less: Fees waived, expenses reimbursed and expense offset arrangement(s) | (229,207 | ) | ||
Net expenses, before taxes | 66,977 | |||
Net investment income (loss), before taxes | (50,642 | ) | ||
Net tax expense (benefit) | 0 | |||
Net investment income (loss), net of taxes | (50,642 | ) | ||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | (67,150 | ) | ||
Net tax expense (benefit) | 0 | |||
Net realized gain (loss), net of taxes | (67,150 | ) | ||
Change in net unrealized appreciation of: | ||||
Investment securities | 264,468 | |||
Net tax expense (benefit) | 0 | |||
Net change in net unrealized appreciation of investment securities, net of taxes | 264,468 | |||
Net realized and unrealized gain, net of taxes | 197,318 | |||
Net increase in net assets resulting from operations | $ | 146,676 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco MLP Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income (loss), net of taxes | $ | (50,642 | ) | $ | (101,821 | ) | ||
Net realized gain (loss), net of taxes | (67,150 | ) | 282,901 | |||||
Change in net unrealized appreciation (depreciation), net of taxes | 264,468 | (882,581 | ) | |||||
Net increase (decrease) in net assets resulting from operations | 146,676 | (701,501 | ) | |||||
Return of Capital: | ||||||||
Class A | (118,734 | ) | (241,759 | ) | ||||
Class C | (26,143 | ) | (55,987 | ) | ||||
Class R | (9,984 | ) | (14,486 | ) | ||||
Class Y | (150,416 | ) | (273,122 | ) | ||||
Class R5 | (167 | ) | (344 | ) | ||||
Class R6 | (167 | ) | (344 | ) | ||||
Total return of capital | (305,611 | ) | (586,042 | ) | ||||
Share transactions–net: | ||||||||
Class A | 727,192 | 23,111 | ||||||
Class C | (47,024 | ) | (55,702 | ) | ||||
Class R | 55,162 | 139,522 | ||||||
Class Y | 262,043 | 2,025,103 | ||||||
Net increase in net assets resulting from share transactions | 997,373 | 2,132,034 | ||||||
Net increase in net assets | 838,438 | 844,491 | ||||||
Net assets: | ||||||||
Beginning of period | 9,975,904 | 9,131,413 | ||||||
End of period (includes undistributed net investment income (loss), net of taxes of $(1,779,021) and $(1,422,768), respectively) | $ | 10,814,342 | $ | 9,975,904 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco MLP Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is capital appreciation and, secondarily, income.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net
8 Invesco MLP Fund
asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
9 Invesco MLP Fund
D. | Distributions — Distributions from net investment income, if any, are declared and paid quarterly and are recorded on the ex-dividend date. Distributions from net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. |
E. | Master Limited Partnerships — The Fund primarily invests in Master Limited Partnerships (“MLPs”). MLPs are publicly traded partnerships and limited liability companies taxed as partnerships under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”). The Fund principally invests in MLPs that derive their revenue primarily from businesses involved in the gathering, transporting, processing, treating, storing, refining, distributing, mining or marketing of natural gas, natural gas liquids, crude oil, refined products or coal (“energy infrastructure MLPs”). The Fund is a partner in each MLP; accordingly, the Fund is required to take into account the Fund’s allocable share of income, gains, losses, deductions, expenses, and tax credits recognized by each MLP. |
The Fund is non-diversified and will concentrate its investments in the energy sector. Energy infrastructure MLPs are subject to a variety of industry specific risk factors that may adversely affect their business or operations, including a decrease in production or reduced volumes of natural gas or other energy commodities available for transporting, processing, storing or distributing; changes in energy commodity prices; a sustained reduced demand for crude oil, natural gas and refined petroleum products; depletion of natural gas reserves or other commodities if not replaced; natural disasters, extreme weather and environmental hazards; rising interest rates, how facilities are constructed, maintained and operated, environmental and safety controls, and the prices they may charge for products and services. In addition, taxes, government regulation, international politics, price, and supply fluctuations, volatile interest rates and energy conservation may cause difficulties for energy infrastructure MLPs.
MLPs may be less liquid and subject to more abrupt or erratic price movements than conventional publicly traded securities.
F. | Return of Capital — Distributions received from the Fund’s investments in MLPs generally are comprised of income and return of capital. The Fund records investment income and return of capital based on estimates made at the time such distributions are received. The return of capital portion of the distribution is a reduction to investment income that results in an equivalent reduction in the cost basis of the associated investments and increases net realized gains (losses) and change in unrealized appreciation (depreciation). Such estimates are based on historical information available from each MLP and other industry sources. These estimates will subsequently be revised and may materially differ primarily based on information received from the MLPs after their tax reporting periods are concluded. |
G. | Federal Income Taxes — The Fund does not intend to qualify as a regulated investment company pursuant to Subchapter M of the Internal Revenue Code. The Fund is treated as a regular corporation, or “C” corporation, for U.S. federal income tax purposes and generally is subject to U.S. federal income tax on its taxable income at the graduated rates applicable to corporations. In addition, as a regular corporation, the Fund may be subject to state and local taxes in jurisdictions in which the MLPs operate. The estimate state tax rate is based on a periodic analysis of the Fund’s holdings. The Fund may also be subject to a federal alternative minimum tax on its alternative minimum taxable income to the extent that the alternative minimum tax exceeds the Fund’s regular federal income tax liability. |
Taxes include current and deferred taxes. Current taxes reflect the estimated tax liability of the Fund as of a measurement date based on taxable income. Deferred taxes reflect estimates of (i) taxes on net unrealized gains (losses), which are attributable to the difference between fair market value and tax basis, (ii) the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for tax purposes, and (iii) the net tax benefit of accumulated net operating losses, capital loss carryforwards and other tax attributes.
The Fund’s deferred tax asset (“DTA”) and/or liability balances are estimated using estimates of effective tax rates expected to apply to taxable income in the years such balances are realized. A DTA will be recognized for temporary book/tax differences, net of unrealized losses, and carryforwards (net operating losses, capital loss carryforward, or tax credits). To the extent the Fund has a DTA, the Fund will assess whether a valuation allowance is required to offset the value of a portion, or all, of the DTA. Prior year ordinary income or capital gains (carrybacks), unrealized net gains, future reversals of existing taxable timing differences, forecast of future profitability (based on historical evidence), potential tax planning strategies, unsettled circumstances, and other evidence will be used in determining the valuation allowance. The valuation allowance is reviewed periodically and the Fund may modify its estimates or assumptions regarding the net deferred tax asset or liability balances and any applicable valuation allowance.
The Fund recognizes interest and penalties associated with underpayment of federal and state income taxes, if any, in tax expense. The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
H. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
I. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
J. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum |
10 Invesco MLP Fund
exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $1 billion | 1.00% | |||
Next $1.5 billion | 0.95% | |||
Next $2 billion | 0.93% | |||
Next $3.5 billion | 0.91% | |||
Over $8 billion | 0.90% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 1.00%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Invesco Capital Management LLC, formerly, PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 1.28%, 2.03%, 1.53%, 1.03%, 1.03% and 1.03%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees and reimbursed fund level expenses of $219,726 and reimbursed class level expenses of $3,634, $924, $323, $4,376, $3 and $3 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $2,485 in front-end sales commissions from the sale of Class A shares and $253 and $21 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
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NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
As of April 30, 2018, all of the securities in this Fund were valued based on Level 1 inputs (see the Schedule of Investments for security categories). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
NOTE 4—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $218.
NOTE 5—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund.
NOTE 6—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 7—Tax Information
On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax code, including but not limited to (1) reducing the U.S. federal corporate income tax rate from 35 percent to 21 percent; (2) repealing the alternative minimum tax; and (4) changing rules related to use and limitations of net operating loss carryforwards created in tax years beginning after December 31, 2017.
At October 31, 2017, the Fund had a net U.S. deferred tax asset totaling $856,440. As a result of the reduction in the corporate income tax rate under the Tax Act, the Fund has revalued its net deferred tax asset. The Fund has recorded a decrease in the value of its net deferred tax asset by approximately $302,634, which has been offset by a valuation allowance for the year ended October 31, 2017. The Fund’s revaluation of its deferred tax asset is subject to further clarification of the Tax Act. As a result, the actual impact on the net deferred tax asset may vary from the initially recorded amount due to uncertainties in the Fund’s preliminary review.
The impact of the 2017 Tax Act is based upon our analysis and interpretations of currently available information. Uncertainties remain regarding the impact of the 2017 Tax Act due to future regulatory and rulemaking processes, prospects of additional corrective or supplemental legislation, and potential trade or litigation. These uncertainties, along with our completion of the calculations and potential changes in our initial assumptions as new information becomes available, could cause the actual charge to ultimately differ materially from the provisional amount recorded in 2017 related to the enactment of the 2017 Tax Act.
Total taxes have been computed by applying the federal statutory tax rate of 21% plus a blended state and other tax rate of 2.15%. The Fund applied this rate to net investment income (loss) and realized and unrealized gains (losses) on investments before taxes in computing its total tax expense (benefit).
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The provision for taxes differs from the amount derived from applying the statutory tax rate to net investment income (loss) and realized and unrealized gains (losses) before taxes at period-end as follows:
Provision at statutory rates | $ | 30,803 | 21.00 | % | ||||
State and other taxes, net of federal tax benefit | 2,901 | 1.98 | ||||||
Permanent differences, current period | (2,516 | ) | (1.72 | ) | ||||
Valuation allowance | (333,822 | ) | (227.59 | ) | ||||
Return to provision | 302,634 | 206.33 | ||||||
Total | $ | 0 | 0.00 | % |
Components of the Fund’s Net Deferred Tax Asset (Liability) at Period-End:
Deferred Tax Assets: | ||||
Net operating loss carryforward | $ | 240,600 | ||
Capital loss carryforward | 379,991 | |||
Unrealized gains (losses) on investment securities | — | |||
Total Deferred Tax Assets | 620,591 | |||
Valuation allowance | (522,619 | ) | ||
Net Deferred Tax Asset | $ | 97,972 | ||
Deferred Tax Liabilities: | ||||
Unrealized gains (losses) on investment securities | $ | (97,972 | ) | |
Total Net Deferred Tax Asset (Liability) | $ | 0 |
The Fund had a capital loss carryforward as of October 31, 2017, of $1,621,958. Capital losses may be carried forward for 5 years and accordingly, would begin to expire as of October 31, 2019.
The Fund had a federal net operating loss carryforward as of October 31, 2017, of $417,212, which begin to expire in 2034. As of October 31, 2017, the Fund had state net operating losses of approximately $1,034,431. If not utilized, these net operating losses will expire in various years through October 31, 2037. The amount of deferred tax asset for net operating losses and capital loss carryforwards at April 30, 2018 includes amounts for the period from November 1, 2017 through April 30, 2018.
At April 30, 2018, based on the net unrealized losses on the Fund’s investment securities, the Fund has recorded a valuation allowance to offset the DTA as the Fund has determined at April 30, 2018 based on historical evidence it is unlikely the DTA will be realized.
Tax Character of Distributions to Shareholders Paid During the Six Months Ended April 30, 2018 and the Fiscal Year Ended October 31, 2017:
2018 | 2017 | |||||||
Return of capital | $ | 305,611 | $ | 586,042 |
NOTE 8—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $5,927,036 and $5,104,831, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 405,292 | ||
Aggregate unrealized (depreciation) of investments | — | |||
Net unrealized appreciation of investments | $ | 405,292 |
Cost of investments for tax purposes is $10,269,910.
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NOTE 9—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018 (a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 379,244 | $ | 2,229,416 | 296,058 | $ | 1,878,977 | ||||||||||
Class C | 45,884 | 253,342 | 87,078 | 549,317 | ||||||||||||
Class R | 16,130 | 87,977 | 29,368 | 173,908 | ||||||||||||
Class Y | 124,325 | 659,937 | 640,024 | 4,089,555 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 16,043 | 83,500 | 27,561 | 166,884 | ||||||||||||
Class C | 4,475 | 23,381 | 7,831 | 47,155 | ||||||||||||
Class R | 1,869 | 9,831 | 2,368 | 14,173 | ||||||||||||
Class Y | 21,181 | 110,679 | 20,960 | 126,518 | ||||||||||||
Reacquired: | ||||||||||||||||
Class A | (270,717 | ) | (1,585,724 | ) | (329,385 | ) | (2,022,750 | ) | ||||||||
Class C | (58,733 | ) | (323,747 | ) | (107,583 | ) | (652,174 | ) | ||||||||
Class R | (7,379 | ) | (42,646 | ) | (7,876 | ) | (48,559 | ) | ||||||||
Class Y(b) | (91,674 | ) | (508,573 | ) | (346,686 | ) | (2,190,970 | ) | ||||||||
Net increase in share activity | 180,648 | $ | 997,373 | 319,718 | $ | 2,132,034 |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 52% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Trust has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
In addition, 15% of the outstanding shares of the Fund are owned by the Adviser or an affiliated of the Adviser. |
(b) | On March 14, 2017, 175,247 Class Y shares valued at $1,140,858 were sold by the Adviser or an affiliate of the Adviser. |
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NOTE 10—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Class A | ||||||||||||||||||||
Six months ended 2018 | Years ended October 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014(a) | |||||||||||||||||
Net asset value, beginning of period | $ | 5.46 | $ | 6.06 | $ | 6.45 | $ | 9.35 | $ | 10.00 | ||||||||||
Net investment income (loss)(b) | (0.03 | ) | (0.06 | ) | (0.07 | ) | (0.09 | ) | (0.01 | ) | ||||||||||
Net gains (losses) on securities (both realized and unrealized) | 0.12 | (0.21 | ) | 0.02 | (2.51 | ) | (0.64 | ) | ||||||||||||
Total from investment operations | 0.09 | (0.27 | ) | (0.05 | ) | (2.60 | ) | (0.65 | ) | |||||||||||
Less: | ||||||||||||||||||||
Return of capital | (0.16 | ) | (0.33 | ) | (0.34 | ) | (0.30 | ) | — | |||||||||||
Net asset value, end of period | $ | 5.39 | $ | 5.46 | $ | 6.06 | $ | 6.45 | $ | 9.35 | ||||||||||
Total return(c) | 1.75 | % | (4.88 | )% | (0.14 | )% | (28.30 | )% | (6.50 | )% | ||||||||||
Net assets, end of period (000’s omitted) | $ | 4,241 | $ | 3,619 | $ | 4,050 | $ | 2,489 | $ | 1,931 | ||||||||||
Portfolio turnover rate(d) | 49 | % | 93 | % | 57 | % | 107 | % | 5 | % | ||||||||||
Ratios/supplemental data based on average net assets: | ||||||||||||||||||||
Ratio of expenses: | ||||||||||||||||||||
With fee waivers and/or expense reimbursements, before taxes | 1.31 | %(e) | 1.33 | % | 1.50 | % | 1.50 | % | 1.49 | %(f) | ||||||||||
Tax expense (benefit)(g) | 0 | %(e) | 0 | % | 0 | % | 0 | % | 0 | %(f) | ||||||||||
With fee waivers and/or expense reimbursements, after taxes(g) | 1.31 | %(e) | 1.33 | % | 1.50 | % | 1.50 | % | 1.49 | %(f) | ||||||||||
Without fee waivers and/or expense reimbursements, after taxes(g) | 5.66 | %(e) | 4.90 | % | 4.75 | % | 6.37 | % | 72.56 | %(f) | ||||||||||
Ratio of net investment income (loss), before taxes | (1.00 | )%(e) | (0.95 | )% | (1.28 | )% | (1.16 | )% | (0.54 | )%(f) | ||||||||||
Ratio of net investment income (loss), after taxes(h) | (1.00 | )%(e) | (0.95 | )% | (1.28 | )% | (1.16 | )% | (0.54 | )%(f) |
(a) | Commencement date of August 29, 2014. |
(b) | Calculated using average shares outstanding. |
(c) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $4,166. |
(f) | Annualized. |
(g) | Ratio includes tax expense derived from net investment income (loss) and realized and unrealized gains (losses). |
(h) | Ratio includes tax expense derived from net investment income (loss) only. |
15 Invesco MLP Fund
NOTE 10—Financial Highlights—(continued)
Class C | ||||||||||||||||||||
Six months ended 2018 | Years ended October 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014(a) | |||||||||||||||||
Net asset value, beginning of period | $ | 5.46 | $ | 6.05 | $ | 6.45 | $ | 9.34 | $ | 10.00 | ||||||||||
Net investment income (loss)(b) | (0.05 | ) | (0.10 | ) | (0.12 | ) | (0.16 | ) | (0.02 | ) | ||||||||||
Net gains (losses) on securities (both realized and unrealized) | 0.11 | (0.21 | ) | 0.02 | (2.49 | ) | (0.64 | ) | ||||||||||||
Total from investment operations | 0.06 | (0.31 | ) | (0.10 | ) | (2.65 | ) | (0.66 | ) | |||||||||||
Less: | ||||||||||||||||||||
Return of capital | (0.14 | ) | (0.28 | ) | (0.30 | ) | (0.24 | ) | — | |||||||||||
Net asset value, end of period | $ | 5.38 | $ | 5.46 | $ | 6.05 | $ | 6.45 | $ | 9.34 | ||||||||||
Total return(c) | 1.17 | % | (5.45 | )% | (1.08 | )% | (28.78 | )% | (6.60 | )% | ||||||||||
Net assets, end of period (000’s omitted) | $ | 1,028 | $ | 1,088 | $ | 1,283 | $ | 205 | $ | 1,713 | ||||||||||
Portfolio turnover rate(d) | 49 | % | 93 | % | 57 | % | 107 | % | 5 | % | ||||||||||
Ratios/supplemental data based on average net assets: | ||||||||||||||||||||
Ratio of expenses: | ||||||||||||||||||||
With fee waivers and/or expense reimbursements, before taxes | 2.06 | %(e) | 2.08 | % | 2.25 | % | 2.25 | % | 2.24 | %(f) | ||||||||||
Tax expense (benefit)(g) | 0 | %(e) | 0 | % | 0 | % | 0 | % | 0 | %(f) | ||||||||||
With fee waivers and/or expense reimbursements, after taxes(g) | 2.06 | %(e) | 2.08 | % | 2.25 | % | 2.25 | % | 2.24 | %(f) | ||||||||||
Without fee waivers and/or expense reimbursements, after taxes(g) | 6.41 | %(e) | 5.65 | % | 5.50 | % | 7.12 | % | 73.31 | %(f) | ||||||||||
Ratio of net investment income (loss), before taxes | (1.75 | )%(e) | (1.70 | )% | (2.03 | )% | (1.91 | )% | (1.29 | )%(f) | ||||||||||
Ratio of net investment income (loss), after taxes(h) | (1.75 | )%(e) | (1.70 | )% | (2.03 | )% | (1.91 | )% | (1.29 | )%(f) |
(a) | Commencement date of August 29, 2014. |
(b) | Calculated using average shares outstanding. |
(c) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $1,060. |
(f) | Annualized. |
(g) | Ratio includes tax expense derived from net investment income (loss) and realized and unrealized gains (losses). |
(h) | Ratio includes tax expense derived from net investment income (loss) only. |
16 Invesco MLP Fund
NOTE 10—Financial Highlights—(continued)
Class R | ||||||||||||||||||||
Six months ended 2018 | Years ended October 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014(a) | |||||||||||||||||
Net asset value, beginning of period | $ | 5.46 | $ | 6.06 | $ | 6.45 | $ | 9.35 | $ | 10.00 | ||||||||||
Net investment income (loss)(b) | (0.03 | ) | (0.07 | ) | (0.09 | ) | (0.11 | ) | (0.01 | ) | ||||||||||
Net gains (losses) on securities (both realized and unrealized) | 0.11 | (0.22 | ) | 0.03 | (2.51 | ) | (0.64 | ) | ||||||||||||
Total from investment operations | 0.08 | (0.29 | ) | (0.06 | ) | (2.62 | ) | (0.65 | ) | |||||||||||
Less: | ||||||||||||||||||||
Return of capital | (0.15 | ) | (0.31 | ) | (0.33 | ) | (0.28 | ) | — | |||||||||||
Net asset value, end of period | $ | 5.39 | $ | 5.46 | $ | 6.06 | $ | 6.45 | $ | 9.35 | ||||||||||
Total return(c) | 1.62 | % | (5.12 | )% | (0.39 | )% | (28.48 | )% | (6.50 | )% | ||||||||||
Net assets, end of period (000’s omitted) | $ | 400 | $ | 347 | $ | 241 | $ | 35 | $ | 21 | ||||||||||
Portfolio turnover rate(d) | 49 | % | 93 | % | 57 | % | 107 | % | 5 | % | ||||||||||
Ratios/supplemental data based on average net assets: | ||||||||||||||||||||
Ratio of expenses: | ||||||||||||||||||||
With fee waivers and/or expense reimbursements, before taxes | 1.56 | %(e) | 1.58 | % | 1.75 | % | 1.75 | % | 1.74 | %(f) | ||||||||||
Tax expense (benefit)(g) | 0 | %(e) | 0 | % | 0 | % | 0 | % | 0 | %(f) | ||||||||||
With fee waivers and/or expense reimbursements, after taxes(g) | 1.56 | %(e) | 1.58 | % | 1.75 | % | 1.75 | % | 1.74 | %(f) | ||||||||||
Without fee waivers and/or expense reimbursements, after taxes(g) | 5.91 | %(e) | 5.15 | % | 5.00 | % | 6.62 | % | 72.80 | %(f) | ||||||||||
Ratio of net investment income (loss), before taxes | (1.25 | )%(e) | (1.20 | )% | (1.53 | )% | (1.41 | )% | (0.79 | )%(f) | ||||||||||
Ratio of net investment income (loss), after taxes(h) | (1.25 | )%(e) | (1.20 | )% | (1.53 | )% | (1.41 | )% | (0.79 | )%(f) |
(a) | Commencement date of August 29, 2014. |
(b) | Calculated using average shares outstanding. |
(c) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $371. |
(f) | Annualized. |
(g) | Ratio includes tax expense derived from net investment income (loss) and realized and unrealized gains (losses). |
(h) | Ratio includes tax expense derived from net investment income (loss) only. |
17 Invesco MLP Fund
NOTE 10—Financial Highlights—(continued)
Class Y | ||||||||||||||||||||
Six months ended 2018 | Years ended October 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014(a) | |||||||||||||||||
Net asset value, beginning of period | $ | 5.47 | $ | 6.07 | $ | 6.46 | $ | 9.36 | $ | 10.00 | ||||||||||
Net investment income (loss)(b) | (0.02 | ) | (0.04 | ) | (0.06 | ) | (0.07 | ) | (0.01 | ) | ||||||||||
Net gains (losses) on securities (both realized and unrealized) | 0.11 | (0.22 | ) | 0.03 | (2.51 | ) | (0.63 | ) | ||||||||||||
Total from investment operations | 0.09 | (0.26 | ) | (0.03 | ) | (2.58 | ) | (0.64 | ) | |||||||||||
Less: | ||||||||||||||||||||
Return of capital | (0.17 | ) | (0.34 | ) | (0.36 | ) | (0.32 | ) | — | |||||||||||
Net asset value, end of period | $ | 5.39 | $ | 5.47 | $ | 6.07 | $ | 6.46 | $ | 9.36 | ||||||||||
Total return(c) | 1.69 | % | (4.61 | )% | 0.14 | % | (28.07 | )% | (6.40 | )% | ||||||||||
Net assets, end of period (000’s omitted) | $ | 5,135 | $ | 4,912 | $ | 3,545 | $ | 2,094 | $ | 1,628 | ||||||||||
Portfolio turnover rate(d) | 49 | % | 93 | % | 57 | % | 107 | % | 5 | % | ||||||||||
Ratios/supplemental data based on average net assets: | ||||||||||||||||||||
Ratio of expenses: | ||||||||||||||||||||
With fee waivers and/or expense reimbursements, before taxes | 1.06 | %(e) | 1.08 | % | 1.25 | % | 1.25 | % | 1.24 | %(f) | ||||||||||
Tax expense (benefit)(g) | 0 | %(e) | 0 | % | 0 | % | 0 | % | 0 | %(f) | ||||||||||
With fee waivers and/or expense reimbursements, after taxes(g) | 1.06 | %(e) | 1.08 | % | 1.25 | % | 1.25 | % | 1.24 | %(f) | ||||||||||
Without fee waivers and/or expense reimbursements, after taxes(g) | 5.41 | %(e) | 4.65 | % | 4.50 | % | 6.12 | % | 72.31 | %(f) | ||||||||||
Ratio of net investment income (loss), before taxes | (0.75 | )%(e) | (0.70 | )% | (1.03 | )% | (0.91 | )% | (0.29 | )%(f) | ||||||||||
Ratio of net investment income (loss), after taxes(h) | (0.75 | )%(e) | (0.70 | )% | (1.03 | )% | (0.91 | )% | (0.29 | )%(f) |
(a) | Commencement date of August 29, 2014. |
(b) | Calculated using average shares outstanding. |
(c) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $5,017. |
(f) | Annualized. |
(g) | Ratio includes tax expense derived from net investment income (loss) and realized and unrealized gains (losses). |
(h) | Ratio includes tax expense derived from net investment income (loss) only. |
18 Invesco MLP Fund
NOTE 10—Financial Highlights—(continued)
Class R5 | ||||||||||||||||||||
Six months ended 2018 | Years ended October 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014(a) | |||||||||||||||||
Net asset value, beginning of period | $ | 5.46 | $ | 6.06 | $ | 6.46 | $ | 9.36 | $ | 10.00 | ||||||||||
Net investment income (loss)(b) | (0.02 | ) | (0.04 | ) | (0.06 | ) | (0.07 | ) | (0.01 | ) | ||||||||||
Net gains (losses) on securities (both realized and unrealized) | 0.12 | (0.22 | ) | 0.02 | (2.51 | ) | (0.63 | ) | ||||||||||||
Total from investment operations | 0.10 | (0.26 | ) | (0.04 | ) | (2.58 | ) | (0.64 | ) | |||||||||||
Less: | ||||||||||||||||||||
Return of capital | (0.17 | ) | (0.34 | ) | (0.36 | ) | (0.32 | ) | — | |||||||||||
Net asset value, end of period | $ | 5.39 | $ | 5.46 | $ | 6.06 | $ | 6.46 | $ | 9.36 | ||||||||||
Total return(c) | 1.88 | % | (4.63 | )% | (0.03 | )% | (28.07 | )% | (6.40 | )% | ||||||||||
Net assets, end of period (000’s omitted) | $ | 5 | $ | 5 | $ | 6 | $ | 6 | $ | 9 | ||||||||||
Portfolio turnover rate(d) | 49 | % | 93 | % | 57 | % | 107 | % | 5 | % | ||||||||||
Ratios/supplemental data based on average net assets: | ||||||||||||||||||||
Ratio of expenses: | ||||||||||||||||||||
With fee waivers and/or expense reimbursements, before taxes | 1.06 | %(e) | 1.08 | % | 1.25 | % | 1.25 | % | 1.24 | %(f) | ||||||||||
Tax expense (benefit)(g) | 0 | %(e) | 0 | % | 0 | % | 0 | % | 0 | %(f) | ||||||||||
With fee waivers and/or expense reimbursements, after taxes(g) | 1.06 | %(e) | 1.08 | % | 1.25 | % | 1.25 | % | 1.24 | %(f) | ||||||||||
Without fee waivers and/or expense reimbursements, after taxes(g) | 5.33 | %(e) | 4.57 | % | 4.44 | % | 6.10 | % | 72.28 | %(f) | ||||||||||
Ratio of net investment income (loss), before taxes | (0.75 | )%(e) | (0.70 | )% | (1.03 | )% | (0.91 | )% | (0.29 | )%(f) | ||||||||||
Ratio of net investment income (loss), after taxes(h) | (0.75 | )%(e) | (0.70 | )% | (1.03 | )% | (0.91 | )% | (0.29 | )%(f) |
(a) | Commencement date of August 29, 2014. |
(b) | Calculated using average shares outstanding. |
(c) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $6. |
(f) | Annualized. |
(g) | Ratio includes tax expense derived from net investment income (loss) and realized and unrealized gains (losses). |
(h) | Ratio includes tax expense derived from net investment income (loss) only. |
19 Invesco MLP Fund
NOTE 10—Financial Highlights—(continued)
Class R6 | ||||||||||||||||||||
Six months ended 2018 | Years ended October 31, | |||||||||||||||||||
2017 | 2016 | 2015 | 2014(a) | |||||||||||||||||
Net asset value, beginning of period | $ | 5.46 | $ | 6.06 | $ | 6.46 | $ | 9.36 | $ | 10.00 | ||||||||||
Net investment income (loss)(b) | (0.02 | ) | (0.04 | ) | (0.06 | ) | (0.07 | ) | (0.01 | ) | ||||||||||
Net gains (losses) on securities (both realized and unrealized) | 0.12 | (0.22 | ) | 0.02 | (2.51 | ) | (0.63 | ) | ||||||||||||
Total from investment operations | 0.10 | (0.26 | ) | (0.04 | ) | (2.58 | ) | (0.64 | ) | |||||||||||
Less: | ||||||||||||||||||||
Return of capital | (0.17 | ) | (0.34 | ) | (0.36 | ) | (0.32 | ) | — | |||||||||||
Net asset value, end of period | $ | 5.39 | $ | 5.46 | $ | 6.06 | $ | 6.46 | $ | 9.36 | ||||||||||
Total return(c) | 1.88 | % | (4.63 | )% | (0.03 | )% | (28.07 | )% | (6.40 | )% | ||||||||||
Net assets, end of period (000’s omitted) | $ | 5 | $ | 5 | $ | 6 | $ | 6 | $ | 9 | ||||||||||
Portfolio turnover rate(d) | 49 | % | 93 | % | 57 | % | 107 | % | 5 | % | ||||||||||
Ratios/supplemental data based on average net assets: | ||||||||||||||||||||
Ratio of expenses: | ||||||||||||||||||||
With fee waivers and/or expense reimbursements, before taxes | 1.06 | %(e) | 1.08 | % | 1.25 | % | 1.25 | % | 1.24 | %(f) | ||||||||||
Tax expense (benefit)(g) | 0 | %(e) | 0 | % | 0 | % | 0 | % | 0 | %(f) | ||||||||||
With fee waivers and/or expense reimbursements, after taxes(g) | 1.06 | %(e) | 1.08 | % | 1.25 | % | 1.25 | % | 1.24 | %(f) | ||||||||||
Without fee waivers and/or expense reimbursements, after taxes(g) | 5.33 | %(e) | 4.57 | % | 4.44 | % | 6.10 | % | 72.23 | %(f) | ||||||||||
Ratio of net investment income (loss), before taxes | (0.75 | )%(e) | (0.70 | )% | (1.03 | )% | (0.91 | )% | (0.29 | )%(f) | ||||||||||
Ratio of net investment income (loss), after taxes(h) | (0.75 | )%(e) | (0.70 | )% | (1.03 | )% | (0.91 | )% | (0.29 | )%(f) |
(a) | Commencement date of August 29, 2014. |
(b) | Calculated using average shares outstanding. |
(c) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $6. |
(f) | Annualized. |
(g) | Ratio includes tax expense derived from net investment income (loss) and realized and unrealized gains (losses). |
(h) | Ratio includes tax expense derived from net investment income (loss) only. |
20 Invesco MLP Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 1,017.50 | $ | 6.55 | $ | 1,018.30 | $ | 6.56 | 1.31 | % | ||||||||||||
C | 1,000.00 | 1,011.70 | 10.28 | 1,014.58 | 10.29 | 2.06 | ||||||||||||||||||
R | 1,000.00 | 1,016.20 | 7.80 | 1,017.06 | 7.80 | 1.56 | ||||||||||||||||||
Y | 1,000.00 | 1,016.90 | 5.30 | 1,019.54 | 5.31 | 1.06 | ||||||||||||||||||
R5 | 1,000.00 | 1,018.80 | 5.31 | 1,019.54 | 5.31 | 1.06 | ||||||||||||||||||
R6 | 1,000.00 | 1,018.80 | 5.31 | 1,019.54 | 5.31 | 1.06 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
21 Invesco MLP Fund
Explore High-Conviction Investing with Invesco
Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
∎ Quarterly statements
∎ Daily confirmations
∎ Tax forms
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your house-hold, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin send-ing you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. MLP-SAR-1 06152018 0844
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
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Invesco Multi-Asset Income Fund
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Nasdaq: | ||||
A: PIAFX ∎ C: PICFX ∎ R: PIRFX ∎ Y: PIYFX ∎ R5: IPNFX ∎ R6: PIFFX |
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2
| Fund Performance
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4
| Letters to Shareholders
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5
| Schedule of Investments
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22
| Financial Statements
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24
| Notes to Financial Statements
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35
| Financial Highlights
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36
| Fund Expenses
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37 | Distribution Information
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For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
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NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
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Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
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Class A Shares | -2.05 | % | ||
Class C Shares | -2.43 | |||
Class R Shares | -2.18 | |||
Class Y Shares | -1.93 | |||
Class R5 Shares | -1.93 | |||
Class R6 Shares | -1.93 | |||
Bloomberg Barclays U.S. Aggregate Bond Index▼ (Broad Market Index) | -1.87 | |||
Custom Invesco Multi-Asset Income Index∎ (Style-Specific Index) | 1.15 | |||
Lipper Mixed-Asset Target Allocation Conservative Funds Index◆ (Peer Group Index) | 0.47 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Invesco, FactSet Research Systems Inc.; ◆Lipper Inc. |
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The Bloomberg Barclays U.S. Aggregate Bond Index is an unmanaged index considered representative of the US investment grade, fixed-rate bond market. The Custom Invesco Multi-Asset Income Index, created by Invesco to serve as a benchmark for Invesco Multi-Asset Income Fund, comprises the following indexes: the S&P 500 Index (50%) and the Bloomberg Barclays U.S. Universal Index (50%). The Lipper Mixed-Asset Target Allocation Conservative Funds Index is an unmanaged index considered representative of mixed-asset target allocation conservative funds tracked by Lipper. The S&P 500® Index is an unmanaged index considered representative of the US stock market. The Bloomberg Barclays U.S. Universal Index is an unmanaged index comprising US dollar-denominated, taxable bonds that are rated investment grade or below investment grade. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
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For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Multi-Asset Income Fund
Average Annual Total Returns |
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As of 4/30/18, including maximum applicable sales charges
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Class A Shares |
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Inception (12/14/11) | 5.13 | % | ||||
5 Years | 3.10 | |||||
1 Year | -4.33 | |||||
Class C Shares |
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Inception (12/14/11) | 5.27 | % | ||||
5 Years | 3.49 | |||||
1 Year | -0.52 | |||||
Class R Shares |
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Inception (12/14/11) | 5.80 | % | ||||
5 Years | 4.01 | |||||
1 Year | 0.95 | |||||
Class Y Shares |
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Inception (12/14/11) | 6.32 | % | ||||
5 Years | 4.51 | |||||
1 Year | 1.46 | |||||
Class R5 Shares |
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Inception (12/14/11) | 6.32 | % | ||||
5 Years | 4.51 | |||||
1 Year | 1.36 | |||||
Class R6 Shares |
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Inception | 6.29 | % | ||||
5 Years | 4.51 | |||||
1 Year | 1.46 |
Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 0.85%, 1.60%, 1.10%, 0.60%, 0.60% and 0.60%, respectively.1,2 The
Average Annual Total Returns |
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As of 3/31/18, the most recent calendar quarter end,including maximum applicable sales charges
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Class A Shares |
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Inception (12/14/11) | 5.10 | % | ||||
5 Years | 3.56 | |||||
1 Year | -3.52 | |||||
Class C Shares |
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Inception (12/14/11) | 5.25 | % | ||||
5 Years | 3.95 | |||||
1 Year | 0.39 | |||||
Class R Shares |
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Inception (12/14/11) | 5.77 | % | ||||
5 Years | 4.48 | |||||
1 Year | 1.77 | |||||
Class Y Shares |
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Inception (12/14/11) | 6.31 | % | ||||
5 Years | 5.00 | |||||
1 Year | 2.38 | |||||
Class R5 Shares |
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Inception (12/14/11) | 6.31 | % | ||||
5 Years | 5.00 | |||||
1 Year | 2.28 | |||||
Class R6 Shares |
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Inception | 6.28 | % | ||||
5 Years | 5.00 | |||||
1 Year | 2.28 |
total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.06%, 1.81%, 1.31%, 0.81%, 0.72% and 0.69%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least February 28, 2019. See current prospectus for more information. |
2 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco Multi-Asset Income Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including performance, holdings and portfolio manager commentaries. You can access information about |
your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to consider-ing environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Multi-Asset Income Fund
Schedule of Investments(a)
April 30, 2018
(Unaudited)
Principal Amount | Value | |||||||
U.S. Dollar Denominated Bonds & Notes–39.20% |
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Advertising–0.10% | ||||||||
Lamar Media Corp., Sr. Unsec. Gtd. Global Notes, 5.75%, 02/01/2026 | $ | 595,000 | $ | 615,453 | ||||
Aerospace & Defense–0.40% | ||||||||
BBA U.S. Holdings, Inc., Sr. Unsec. Notes, 5.38%, 05/01/2026(b) | 173,000 | 174,398 | ||||||
Bombardier Inc. (Canada), | 516,000 | 521,805 | ||||||
7.50%, 03/15/2025(b) | 512,000 | 535,040 | ||||||
TransDigm Inc., Sr. Unsec. Gtd. Sub. Global Notes, | 245,000 | 249,747 | ||||||
6.50%, 05/15/2025 | 926,000 | 944,520 | ||||||
2,425,510 | ||||||||
Agricultural & Farm Machinery–0.14% | ||||||||
Titan International, Inc., Sr. Sec. Gtd. First Lien Notes, 6.50%, 11/30/2023(b) | 830,000 | 844,276 | ||||||
Air Freight & Logistics–0.03% | ||||||||
XPO Logistics, Inc., Sr. Unsec. Gtd. Notes, 6.50%, 06/15/2022(b) | 200,000 | 207,250 | ||||||
Airlines–0.08% | ||||||||
Air Canada (Canada), Sr. Unsec. Gtd. Notes, 7.75%, 04/15/2021(b) | 425,000 | 466,969 | ||||||
Alternative Carriers–0.32% | ||||||||
CenturyLink, Inc., | ||||||||
Series S, Sr. Unsec. Notes, | 535,000 | 549,378 | ||||||
Series Y, Sr. Unsec. Global Notes, 7.50%, 04/01/2024 | 477,000 | 487,733 | ||||||
Level 3 Financing, Inc., Sr. Unsec. Gtd. Global Notes, | 627,000 | 608,002 | ||||||
5.38%, 05/01/2025 | 296,000 | 292,211 | ||||||
1,937,324 | ||||||||
Aluminum–0.13% | ||||||||
Novelis Corp., Sr. Unsec. Gtd. Notes, 5.88%, 09/30/2026(b) | 53,000 | 52,735 | ||||||
6.25%, 08/15/2024(b) | 731,000 | 746,534 | ||||||
799,269 | ||||||||
Apparel Retail–0.30% | ||||||||
Hot Topic, Inc., Sr. Sec. Gtd. First Lien Notes, 9.25%, 06/15/2021(b) | 481,000 | 474,987 | ||||||
L Brands, Inc., Sr. Unsec. Gtd. Global Notes, | 1,146,000 | 1,194,820 | ||||||
6.75%, 07/01/2036 | 30,000 | 28,200 | ||||||
6.88%, 11/01/2035 | 120,000 | 114,000 | ||||||
1,812,007 |
Principal Amount | Value | |||||||
Asset Management & Custody Banks–0.20% | ||||||||
Prime Security Services Borrower, LLC/Prime Finance, Inc., Sec. Gtd. Second Lien Notes, 9.25%, 05/15/2023(b) | $ | 1,165,000 | $ | 1,253,831 | ||||
Auto Parts & Equipment–0.15% | ||||||||
Dana Financing Luxembourg S.a.r.l., | 100,000 | 101,750 | ||||||
Dana Inc., Sr. Unsec. Notes, 5.50%, 12/15/2024 | 520,000 | 531,700 | ||||||
Flexi-Van Leasing, Inc., Sec. Second Lien Notes, 10.00%, 02/15/2023(b) | 135,000 | 134,662 | ||||||
Hertz Corp. (The), Sec. Gtd. Second Lien Notes, 7.63%, 06/01/2022(b) | 134,000 | 136,680 | ||||||
904,792 | ||||||||
Automobile Manufacturers–0.15% | ||||||||
J.B. Poindexter & Co., Inc., Sr. Unsec. Bonds, 7.13%, 04/15/2026(b) | 872,000 | 891,620 | ||||||
Automotive Retail–0.24% | ||||||||
Lithia Motors, Inc., Sr. Unsec. Gtd. Notes, 5.25%, 08/01/2025(b) | 177,000 | 175,673 | ||||||
Murphy Oil USA, Inc., Sr. Unsec. Gtd. | 590,000 | 589,262 | ||||||
Penske Automotive Group Inc., Sr. Unsec. Sub. Gtd. Notes, 5.50%, 05/15/2026 | 699,000 | 679,777 | ||||||
1,444,712 | ||||||||
Broadcasting–0.57% | ||||||||
AMC Networks Inc., Sr. Unsec. Gtd. Global Notes, | 86,000 | 81,494 | ||||||
5.00%, 04/01/2024 | 565,000 | 553,700 | ||||||
Clear Channel Worldwide Holdings, Inc., | ||||||||
Series B, Sr. Unsec. Gtd. Global Notes, 6.50%, 11/15/2022 | 335,000 | 344,631 | ||||||
Sr. Unsec. Gtd. Sub. Global Notes, 7.63%, 03/15/2020 | 1,070,000 | 1,076,688 | ||||||
Netflix, Inc., Sr. Unsec. Global Notes, | 423,000 | 439,391 | ||||||
Nexstar Broadcasting, Inc., Sr. Unsec. Gtd. Notes, 5.63%, 08/01/2024(b) | 492,000 | 485,850 | ||||||
Tribune Media Co., Sr. Unsec. Gtd. Global Notes, 5.88%, 07/15/2022 | 490,000 | 498,575 | ||||||
3,480,329 | ||||||||
Building Products–0.16% | ||||||||
Builders FirstSource, Inc., Sr. Sec. Gtd. First Lien Notes, | 195,000 | 193,781 | ||||||
Standard Industries Inc., | 314,000 | 300,655 | ||||||
6.00%, 10/15/2025(b) | 384,000 | 400,320 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Multi-Asset Income Fund
Principal Amount | Value | |||||||
Building Products–(continued) | ||||||||
William Lyon Homes Inc., Sr. Unsec. Notes, 6.00%, 09/01/2023(b) | $ | 116,000 | $ | 116,255 | ||||
1,011,011 | ||||||||
Cable & Satellite–2.44% | ||||||||
Altice Financing S.A. (Luxembourg), | 1,000,000 | 985,000 | ||||||
Altice Luxembourg S.A. (Luxembourg), | 950,000 | 910,812 | ||||||
Altice US Finance I Corp., Sr. Sec. Notes, 5.50%, 05/15/2026(b) | 415,000 | 403,328 | ||||||
CCO Holdings LLC/CCO Holdings | ||||||||
Sr. Unsec. Global Notes, 5.75%, 09/01/2023 | 510,000 | 517,650 | ||||||
Sr. Unsec. Notes, | 1,580,000 | 1,572,100 | ||||||
CSC Holdings LLC, |
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Sr. Unsec. Global Notes, 6.75%, 11/15/2021 | 365,000 | 385,075 | ||||||
Sr. Unsec. Notes, 10.13%, 01/15/2023(b) | 1,450,000 | 1,611,312 | ||||||
10.88%, 10/15/2025(b) | 400,000 | 470,000 | ||||||
DISH DBS Corp., Sr. Unsec. Gtd. | 2,145,000 | 1,842,019 | ||||||
7.88%, 09/01/2019 | 725,000 | 751,376 | ||||||
Intelsat Jackson Holdings | ||||||||
Sr. Sec. Gtd. First Lien Notes, 8.00%, 02/15/2024(b) | 175,000 | 185,063 | ||||||
Sr. Unsec. Gtd. Global Bonds, 5.50%, 08/01/2023 | 420,000 | 353,325 | ||||||
Sr. Unsec. Gtd. Global Notes, 7.25%, 10/15/2020 | 1,151,000 | 1,129,419 | ||||||
7.50%, 04/01/2021 | 333,000 | 316,766 | ||||||
Sirius XM Radio Inc., Sr. Unsec. Gtd. Notes, | 2,000 | 1,995 | ||||||
6.00%, 07/15/2024(b) | 632,000 | 650,889 | ||||||
Telenet Finance Luxembourg Notes S.a r.l. (Belgium), Sr. Sec. First Lien Notes, 5.50%, 03/01/2028(b) | 200,000 | 192,000 | ||||||
Unitymedia Hessen GmbH & Co. KG/Unitymedia NRW GmbH (Germany), Sr. Sec. Gtd. First Lien Bonds, 5.00%, 01/15/2025(b) | 700,000 | 719,250 | ||||||
UPC Holding B.V. (Netherlands), Sr. Sec. First Lien Notes, 5.50%, 01/15/2028(b) | 200,000 | 187,000 | ||||||
UPCB Finance IV Ltd. (Netherlands), Sr. Sec. First Lien Notes, 5.38%, 01/15/2025(b) | 200,000 | 196,500 | ||||||
Virgin Media Finance PLC (United Kingdom), Sr. Unsec. Gtd. Notes, 6.00%, 10/15/2024(b) | 400,000 | 393,500 | ||||||
Virgin Media Secured Finance PLC (United Kingdom), Sr. Sec. Gtd. First Lien Notes, 5.50%, 08/15/2026(b) | 200,000 | 193,000 |
Principal Amount | Value | |||||||
Cable & Satellite–(continued) | ||||||||
VTR Finance B.V. (Chile), Sr. Sec. First Lien Notes, 6.88%, 01/15/2024(b) | $ | 600,000 | $ | 621,906 | ||||
Ziggo Secured Finance B.V. (Netherlands), Sr. Sec. Gtd. First Lien Notes, 5.50%, 01/15/2027(b) | 400,000 | 378,000 | ||||||
14,967,285 | ||||||||
Casinos & Gaming–0.38% | ||||||||
Boyd Gaming Corp., Sr. Unsec. Gtd. Global Notes, | 278,000 | 291,753 | ||||||
6.88%, 05/15/2023 | 220,000 | 231,825 | ||||||
Codere Finance 2 (Luxembourg) S.A. (Spain), Sr. Sec. Gtd. First Lien Notes, 7.63%, 11/01/2021(b) | 400,000 | 409,649 | ||||||
MGM Resorts International, |
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Sr. Unsec. Gtd. Global Notes, 6.63%, 12/15/2021 | 45,000 | 48,262 | ||||||
Sr. Unsec. Gtd. Notes, 4.63%, 09/01/2026 | 299,000 | 284,424 | ||||||
Scientific Games International Inc., Sr. Unsec. Gtd. Global Notes, 10.00%, 12/01/2022 | 703,000 | 760,126 | ||||||
Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp., Sr. Unsec. Gtd. Notes, 5.50%, 03/01/2025(b) | 334,000 | 333,298 | ||||||
2,359,337 | ||||||||
Coal & Consumable Fuels–0.08% | ||||||||
SunCoke Energy Partners, L.P./ SunCoke Energy Partners Finance Corp., Sr. Unsec. Gtd. Notes, 7.50%, 06/15/2025(b) | 463,000 | 478,048 | ||||||
Commodity Chemicals–0.17% | ||||||||
Koppers Inc., Sr. Unsec. Gtd. Notes, 6.00%, 02/15/2025(b) | 356,000 | 363,120 | ||||||
Nufarm Australia Ltd./Nufarm Americas Inc. (Australia), Sr. Unsec. Gtd. Notes, 5.75%, 04/30/2026(b) | 247,000 | 246,691 | ||||||
Valvoline Inc., Sr. Unsec. Gtd. Global Notes, 5.50%, 07/15/2024 | 403,000 | 414,083 | ||||||
1,023,894 | ||||||||
Communications Equipment–0.27% | ||||||||
CommScope Technologies LLC, Sr. Unsec. Gtd. Notes, | 790,000 | 817,650 | ||||||
Hughes Satellite Systems Corp., |
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Sr. Sec. Gtd. First Lien Global Notes, 5.25%, 08/01/2026 | 486,000 | 476,888 | ||||||
Sr. Unsec. Gtd. Global Notes, 7.63%, 06/15/2021 | 357,000 | 384,221 | ||||||
1,678,759 | ||||||||
Construction & Engineering–0.03% | ||||||||
Pisces Midco, Inc., Sr. Sec. Notes, 8.00%, 04/15/2026(b) | 153,000 | 153,811 | ||||||
Construction Machinery & Heavy Trucks–0.19% | ||||||||
Meritor Inc., Sr. Unsec. Gtd. Notes, 6.25%, 02/15/2024 | 658,000 | 679,786 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Multi-Asset Income Fund
Principal Amount | Value | |||||||
Construction Machinery & Heavy Trucks–(continued) | ||||||||
Terex Corp., Sr. Unsec. Gtd. Notes, 5.63%, 02/01/2025(b) | $ | 459,000 | $ | 457,279 | ||||
1,137,065 | ||||||||
Consumer Finance–0.43% | ||||||||
Ally Financial Inc., |
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Sr. Unsec. Global Notes, 5.13%, 09/30/2024 | 725,000 | 744,937 | ||||||
Sr. Unsec. Gtd. Global Notes, 8.00%, 03/15/2020 | 280,000 | 302,400 | ||||||
Discover Financial Services, Inc., | 316,000 | 310,075 | ||||||
Navient Corp., Sr. Unsec. | ||||||||
7.25%, 01/25/2022 | 230,000 | 244,088 | ||||||
8.00%, 03/25/2020 | 705,000 | 752,587 | ||||||
Unifin Financiera, S.A.B. de C.V. SOFOM, E.N.R. (Mexico), Sr. Unsec. Notes, 7.38%, 02/12/2026(b) | 293,000 | 285,309 | ||||||
2,639,396 | ||||||||
Copper–0.32% | ||||||||
First Quantum Minerals Ltd. (Zambia), |
| |||||||
Sr. Unsec. Gtd. Notes, 7.00%, 02/15/2021(b) | 385,000 | 387,888 | ||||||
7.50%, 04/01/2025(b) | 633,000 | 628,284 | ||||||
Freeport-McMoRan Inc., Sr. Unsec. Gtd. Global Notes, 5.40%, 11/14/2034 | 1,010,000 | 936,775 | ||||||
1,952,947 | ||||||||
Data Processing & Outsourced Services–0.29% | ||||||||
First Data Corp., |
| |||||||
Sr. Sec. Gtd. First Lien Notes, 5.00%, 01/15/2024(b) | 60,000 | 60,675 | ||||||
Sr. Unsec. Gtd. Notes, 7.00%, 12/01/2023(b) | 1,626,000 | 1,705,479 | ||||||
1,766,154 | ||||||||
Diversified Banks–0.21% | ||||||||
Dresdner Funding Trust I (Germany), REGS, Jr. Unsec. Sub. Euro Notes, 8.15%, 06/30/2031(b) | 100,000 | 127,731 | ||||||
JPMorgan Chase & Co., Series I, Jr. Unsec. Sub. Global Variable Rate Notes, 5.83% (3 mo. USD LIBOR + 3.47%)(c)(d) | 235,000 | 237,056 | ||||||
Royal Bank of Scotland Group PLC (The) (United Kingdom), Unsec. Sub. | ||||||||
5.13%, 05/28/2024 | 600,000 | 609,922 | ||||||
6.13%, 12/15/2022 | 285,000 | 302,397 | ||||||
1,277,106 | ||||||||
Diversified Chemicals–0.22% | ||||||||
Chemours Co. (The), Sr. Unsec. Gtd. Global Notes, | 878,000 | 924,644 | ||||||
7.00%, 05/15/2025 | 70,000 | 75,687 |
Principal Amount | Value | |||||||
Diversified Chemicals–(continued) | ||||||||
Trinseo Materials Operating S.C.A./Trinseo Materials Finance, Inc., Sr. Unsec. Gtd. Notes, 5.38%, 09/01/2025(b) | $ | 354,000 | $ | 349,575 | ||||
1,349,906 | ||||||||
Diversified Metals & Mining–0.18% | ||||||||
HudBay Minerals, Inc. (Canada), Sr. Unsec. Gtd. Notes, 7.63%, 01/15/2025(b) | 437,000 | 464,994 | ||||||
Teck Resources Ltd. (Canada), |
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Sr. Unsec. Gtd. Global Notes, 4.75%, 01/15/2022 | 291,000 | 296,640 | ||||||
Sr. Unsec. Notes, 6.13%, 10/01/2035 | 330,000 | 352,275 | ||||||
1,113,909 | ||||||||
Diversified REITs–0.08% | ||||||||
CyrusOne L.P./CyrusOne Finance Corp., |
| |||||||
Sr. Unsec. Gtd. Global Notes, 5.00%, 03/15/2024 | 204,000 | 205,020 | ||||||
5.38%, 03/15/2027 | 310,000 | 310,775 | ||||||
515,795 | ||||||||
Diversified Support Services–0.02% | ||||||||
Jaguar Holding Co. II/Pharmaceutical Product Development, LLC, Sr. Unsec. Gtd. Notes, 6.38%, 08/01/2023(b) | 125,000 | 126,875 | ||||||
Electric Utilities–0.28% | ||||||||
NextEra Energy Capital Holdings Inc., |
| |||||||
Jr. Unsec. Gtd. Sub. Investment Units, 5.00%, 01/15/2073 | 27,800 | 671,092 | ||||||
Series K, Jr. Unsec. Gtd. Sub. Investment Units, 5.25%, 06/01/2076 | 42,900 | 1,064,349 | ||||||
1,735,441 | ||||||||
Electrical Components & Equipment–0.11% | ||||||||
EnerSys, Sr. Unsec. Gtd. Notes, 5.00%, 04/30/2023(b) | 693,000 | 699,064 | ||||||
Electronic Equipment & Instruments–0.07% | ||||||||
Itron, Inc., Sr. Unsec. Gtd. Notes, 5.00%, 01/15/2026(b) | 443,000 | 434,007 | ||||||
Environmental & Facilities Services–0.17% | ||||||||
Advanced Disposal Services, Inc., Sr. Unsec. Gtd. Notes, 5.63%, 11/15/2024(b) | 112,000 | 113,120 | ||||||
Core & Main LP, Sr. Unsec. Notes, 6.13%, 08/15/2025(b) | 478,000 | 470,830 | ||||||
Waste Pro USA, Inc., Sr. Unsec. Notes, 5.50%, 02/15/2026(b) | 339,000 | 336,356 | ||||||
Wrangler Buyer Corp., Sr. Unsec. Notes, 6.00%, 10/01/2025(b) | 107,000 | 105,930 | ||||||
1,026,236 | ||||||||
Fertilizers & Agricultural Chemicals–0.08% | ||||||||
OCI N.V. (Netherlands), Sr. Sec. Gtd. Notes, 6.63%, 04/15/2023(b) | 460,000 | 468,165 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Multi-Asset Income Fund
Principal Amount | Value | |||||||
Financial Exchanges & Data–0.10% | ||||||||
MSCI Inc., Sr. Unsec. Gtd. Notes, 5.25%, 11/15/2024(b) | $ | 500,000 | $ | 512,500 | ||||
5.75%, 08/15/2025(b) | 100,000 | 104,780 | ||||||
617,280 | ||||||||
Food Distributors–0.12% | ||||||||
US Foods, Inc., Sr. Unsec. Gtd. Notes, 5.88%, 06/15/2024(b) | 717,000 | 733,133 | ||||||
Food Retail–0.24% | ||||||||
Albertsons Cos. LLC/ Safeway Inc./New Albertson’s, Inc./Albertson’s LLC, Sr. Unsec. Gtd. Global Notes, 6.63%, 06/15/2024 | 587,000 | 550,307 | ||||||
Ingles Markets, Inc., Sr. Unsec. Global Notes, 5.75%, 06/15/2023 | 904,000 | 906,260 | ||||||
1,456,567 | ||||||||
Gas Utilities–0.37% | ||||||||
AmeriGas Partners, L.P./AmeriGas Finance Corp., Sr. Unsec. Global Notes, | ||||||||
5.63%, 05/20/2024 | 144,000 | 144,000 | ||||||
5.88%, 08/20/2026 | 875,000 | 872,812 | ||||||
Ferrellgas L.P./Ferrellgas Finance Corp., Sr. Unsec. Global Notes, 6.50%, 05/01/2021 | 230,000 | 221,375 | ||||||
Suburban Propane Partners, L.P./Suburban Energy Finance Corp., Sr. Unsec. Global Notes, 5.50%, 06/01/2024 | 1,072,000 | 1,037,160 | ||||||
2,275,347 | ||||||||
Health Care Equipment–0.09% | ||||||||
Hill-Rom Holdings, Inc., Sr. Unsec. Gtd. Notes, 5.00%, 02/15/2025(b) | 495,000 | 494,025 | ||||||
Teleflex Inc., Sr. Unsec. Gtd. Global Notes, 4.88%, 06/01/2026 | 56,000 | 55,496 | ||||||
549,521 | ||||||||
Health Care Facilities–1.26% | ||||||||
Acadia Healthcare Co., Inc., Sr. Unsec. Gtd. Global Notes, 6.50%, 03/01/2024 | 575,000 | 598,000 | ||||||
Community Health Systems, Inc., |
| |||||||
Sr. Sec. Gtd. First Lien Global Notes, 5.13%, 08/01/2021 | 450,000 | 416,250 | ||||||
Sr. Sec. Gtd. First Lien Notes, 6.25%, 03/31/2023 | 612,000 | 559,598 | ||||||
Sr. Unsec. Gtd. Global Notes, 6.88%, 02/01/2022 | 122,470 | 67,665 | ||||||
Encompass Health Corp., Sr. Unsec. Gtd. Global Notes, 5.75%, 09/15/2025 | 540,000 | 554,850 | ||||||
HCA, Inc., |
| |||||||
Sr. Sec. Gtd. First Lien Notes, 5.25%, 04/15/2025 | 1,807,000 | 1,834,105 | ||||||
Sr. Unsec. Gtd. Global Notes, 5.88%, 05/01/2023 | 45,000 | 47,025 | ||||||
7.50%, 02/15/2022 | 116,000 | 127,890 | ||||||
Sr. Unsec. Gtd. Notes, 5.38%, 02/01/2025 | 270,000 | 269,325 | ||||||
5.88%, 02/15/2026 | 790,000 | 801,850 |
Principal Amount | Value | |||||||
Health Care Facilities–(continued) | ||||||||
LifePoint Health, Inc., |
| |||||||
Sr. Unsec. Gtd. Global Notes, 5.38%, 05/01/2024 | $ | 345,000 | $ | 329,906 | ||||
Sr. Unsec. Gtd. Notes, 5.88%, 12/01/2023 | 261,000 | 258,716 | ||||||
Tenet Healthcare Corp., |
| |||||||
Sec. Gtd. Second Lien Notes, 7.50%, 01/01/2022(b) | 31,000 | 32,783 | ||||||
Sr. Sec. Gtd. First Lien Global Notes, 6.00%, 10/01/2020 | 100,000 | 103,942 | ||||||
Sr. Unsec. Global Notes, 6.75%, 06/15/2023 | 1,516,000 | 1,496,102 | ||||||
8.13%, 04/01/2022 | 195,000 | 203,775 | ||||||
7,701,782 | ||||||||
Health Care REITs–0.11% | ||||||||
MPT Operating Partnership L.P./MPT Finance Corp., Sr. Unsec. Gtd. Global Notes, 5.00%, 10/15/2027 | 736,000 | 699,200 | ||||||
Health Care Services–0.55% | ||||||||
DaVita Inc., Sr. Unsec. Gtd. Global Notes, 5.00%, 05/01/2025 | 555,000 | 527,361 | ||||||
Eagle Holding Co. II, LLC, Sr. Unsec. PIK Notes, 8.38% PIK Rate, 7.63% Cash Rate, 05/15/2022(b)(e) | 679,000 | 689,185 | ||||||
Envision Healthcare Corp., Sr. Unsec. Gtd. Notes, 6.25%, 12/01/2024(b) | 182,000 | 190,190 | ||||||
Heartland Dental, LLC, Sr. Unsec. Notes, 8.50%, 05/01/2026(b) | 409,000 | 410,943 | ||||||
MPH Acquisition Holdings LLC, Sr. Unsec. Gtd. Notes, | 1,022,000 | 1,042,859 | ||||||
Surgery Center Holdings, Inc., Sr. Unsec. Gtd. Notes, 6.75%, 07/01/2025(b) | 171,000 | 162,450 | ||||||
8.88%, 04/15/2021(b) | 77,000 | 79,502 | ||||||
Team Health Holdings, Inc., Sr. Unsec. Gtd. Notes, 6.38%, 02/01/2025(b) | 315,000 | 275,625 | ||||||
3,378,115 | ||||||||
Home Improvement Retail–0.12% | ||||||||
Hillman Group Inc. (The), Sr. Unsec. Gtd. Notes, 6.38%, 07/15/2022(b) | 771,000 | 749,859 | ||||||
Homebuilding–0.61% | ||||||||
Ashton Woods USA LLC/Ashton Woods Finance Co., | ||||||||
Sr. Unsec. Notes, | 494,000 | 479,180 | ||||||
6.88%, 02/15/2021(b) | 395,000 | 395,987 | ||||||
Beazer Homes USA, Inc., Sr. Unsec. Gtd. Global Notes, | 72,000 | 66,240 | ||||||
6.75%, 03/15/2025 | 395,000 | 390,063 | ||||||
8.75%, 03/15/2022 | 250,000 | 270,625 | ||||||
KB Home, Sr. Unsec. Gtd. Notes, 7.50%, 09/15/2022 | 223,000 | 245,858 | ||||||
Lennar Corp., Sr. Unsec. Gtd. Notes, 5.25%, 06/01/2026(b) | 255,000 | 251,838 | ||||||
5.38%, 10/01/2022(b) | 702,000 | 730,080 | ||||||
8.38%, 01/15/2021(b) | 50,000 | 55,625 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Multi-Asset Income Fund
Principal Amount | Value | |||||||
Homebuilding–(continued) | ||||||||
Meritage Homes Corp., Sr. Unsec. Gtd. Global Notes, | $ | 216,000 | $ | 223,830 | ||||
7.15%, 04/15/2020 | 65,000 | 69,225 | ||||||
Taylor Morrison Communities Inc./ Taylor Morrison Holdings II, Inc., Sr. Unsec. Gtd. Notes, | 569,000 | 584,647 | ||||||
3,763,198 | ||||||||
Household Products–0.32% | ||||||||
Reynolds Group Issuer Inc./LLC, |
| |||||||
Sr. Sec. Gtd. First Lien Notes, 5.13%, 07/15/2023(b) | 41,000 | 41,231 | ||||||
Sr. Unsec. Gtd. Notes, 7.00%, 07/15/2024(b) | 1,138,000 | 1,187,076 | ||||||
Spectrum Brands, Inc., Sr. Unsec. Gtd. Global Notes, 5.75%, 07/15/2025 | 635,000 | 637,572 | ||||||
Springs Industries, Inc., Sr. Sec. Global Notes, 6.25%, 06/01/2021 | 106,000 | 107,722 | ||||||
1,973,601 | ||||||||
Independent Power Producers & Energy Traders–0.31% | ||||||||
AES Corp. (The), Sr. Unsec. Notes, 5.50%, 04/15/2025 | 679,000 | 697,672 | ||||||
Calpine Corp., Sr. Unsec. Global Notes, 5.38%, 01/15/2023 | 234,000 | 225,225 | ||||||
Dynegy Inc., Sr. Unsec. Gtd. Global Notes, 7.38%, 11/01/2022 | 260,000 | 274,625 | ||||||
NRG Energy, Inc., Sr. Unsec. Gtd. Global Notes, | 554,000 | 575,468 | ||||||
6.63%, 01/15/2027 | 113,000 | 116,955 | ||||||
1,889,945 | ||||||||
Industrial Machinery–0.17% | ||||||||
Cleaver-Brooks, Inc., Sr. Sec. Notes, 7.88%, 03/01/2023(b) | 706,000 | 730,710 | ||||||
Mueller Industries, Inc., Unsec. Sub. Deb., 6.00%, 03/01/2027 | 309,000 | 308,227 | ||||||
1,038,937 | ||||||||
Insurance Brokers–0.03% | ||||||||
HUB International Ltd., Sr. Unsec. Notes, 7.00%, 05/01/2026(b) | 177,000 | 177,885 | ||||||
Integrated Oil & Gas–0.13% | ||||||||
Petrobras Global Finance B.V. (Brazil), Sr. Unsec. Gtd. Global Notes, 5.75%, 02/01/2029 | 422,000 | 401,111 | ||||||
Petróleos Mexicanos (Mexico), Sr. Unsec. Gtd. Notes, 5.35%, 02/12/2028(b) | 418,000 | 399,775 | ||||||
800,886 | ||||||||
Integrated Telecommunication Services–0.52% | ||||||||
Altice France S.A. (France), |
| |||||||
Sr. Sec. Gtd. First Lien Bonds, 6.00%, 05/15/2022(b) | 925,000 | 915,704 | ||||||
Sr. Sec. Gtd. First Lien Notes, 7.38%, 05/01/2026(b) | 400,000 | 389,500 |
Principal Amount | Value | |||||||
Integrated Telecommunication Services–(continued) | ||||||||
Cincinnati Bell Inc., Sr. Unsec. Gtd. Notes, 7.00%, 07/15/2024(b) | $ | 502,000 | $ | 463,045 | ||||
Frontier Communications Corp., Sr. Unsec. Global Notes, | ||||||||
10.50%, 09/15/2022 | 827,000 | 731,109 | ||||||
11.00%, 09/15/2025 | 378,000 | 292,005 | ||||||
Telecom Italia Capital S.A. (Italy), |
| |||||||
Sr. Unsec. Gtd. Global Notes, 6.38%, 11/15/2033 | 47,000 | 51,319 | ||||||
7.20%, 07/18/2036 | 320,000 | 368,800 | ||||||
3,211,482 | ||||||||
Internet Software & Services–0.08% | ||||||||
Rackspace Hosting, Inc., Sr. Unsec. Gtd. Notes, 8.63%, 11/15/2024(b) | 498,000 | 506,093 | ||||||
Leisure Facilities–0.05% | ||||||||
Six Flags Entertainment Corp., Sr. Unsec. Gtd. Notes, 4.88%, 07/31/2024(b) | 339,000 | 331,373 | ||||||
Leisure Products–0.17% | ||||||||
Mattel, Inc., |
| |||||||
Sr. Unsec. Global Notes, 5.45%, 11/01/2041 | 204,000 | 166,260 | ||||||
Sr. Unsec. Gtd. Notes, 6.75%, 12/31/2025(b) | 827,000 | 807,235 | ||||||
Sr. Unsec. Notes, | 113,000 | 96,332 | ||||||
1,069,827 | ||||||||
Life Sciences Tools & Services–0.02% | ||||||||
Charles River Laboratories International, Inc., Sr. Unsec. Notes, 5.50%, 04/01/2026(b) | 138,000 | 140,719 | ||||||
Managed Health Care–0.18% | ||||||||
Centene Corp., Sr. Unsec. Notes, 4.75%, 01/15/2025 | 237,000 | 231,001 | ||||||
Molina Healthcare, Inc., Sr. Unsec. Gtd. Notes, 4.88%, 06/15/2025(b) | 192,000 | 183,360 | ||||||
WellCare Health Plans Inc., Sr. Unsec. Notes, 5.25%, 04/01/2025 | 670,000 | 675,092 | ||||||
1,089,453 | ||||||||
Metal & Glass Containers–0.14% | ||||||||
Ardagh Packaging Finance PLC / Ardagh Holdings USA Inc. (Ireland), Sr. Unsec. Gtd. Notes, 6.00%, 02/15/2025(b) | 600,000 | 608,250 | ||||||
Berry Global, Inc., | 85,000 | 88,825 | ||||||
Sec. Gtd. Second Lien Notes, 5.50%, 05/15/2022 | 15,000 | 15,403 | ||||||
OI European Group B.V., Sr. Unsec. Gtd. Notes, 4.00%, 03/15/2023(b) | 133,000 | 126,683 | ||||||
839,161 | ||||||||
Movies & Entertainment–0.15% | ||||||||
AMC Entertainment Holdings, Inc., Sr. Unsec. Gtd. Sub. Global Notes, 5.75%, 06/15/2025 | 925,000 | 900,719 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco Multi-Asset Income Fund
Principal Amount | Value | |||||||
Multi-Utilities–0.37% | ||||||||
Dominion Energy, Inc., Series A, Jr. Unsec. Sub. Investment Units, 5.25%, 07/30/2076 | $ | 38,100 | $ | 927,354 | ||||
DTE Energy Co., |
| |||||||
Series B, Jr. Unsec. Sub. Investment Units, 5.38%, 06/01/2076 | 19,100 | 466,231 | ||||||
Series E, Jr. Unsec. Sub. Investment Units, 5.25%, 12/01/2077 | 19,100 | 457,636 | ||||||
Series F, Jr. Unsec. Sub. Investment Units, 6.00%, 12/15/2076 | 16,700 | 433,866 | ||||||
2,285,087 | ||||||||
Oil & Gas Drilling–0.35% | ||||||||
Ensco PLC, Sr. Unsec. Global Notes, 4.50%, 10/01/2024 | 27,000 | 22,073 | ||||||
7.75%, 02/01/2026 | 477,000 | 450,169 | ||||||
Noble Holding International Ltd. (United Kingdom), Sr. Unsec. Gtd. Global Notes, 7.75%, 01/15/2024 | 547,000 | 515,547 | ||||||
Precision Drilling Corp. (Canada), | ||||||||
Sr. Unsec. Gtd. Global Notes, 5.25%, 11/15/2024 | 610,000 | 577,792 | ||||||
6.50%, 12/15/2021 | 92,000 | 94,300 | ||||||
7.75%, 12/15/2023 | 25,000 | 26,156 | ||||||
Transocean Inc., Sr. Unsec. Gtd. Global Notes, 7.50%, 04/15/2031 | 505,000 | 469,650 | ||||||
2,155,687 | ||||||||
Oil & Gas Equipment & Services–0.27% | ||||||||
Archrock Partners, L.P./Archrock Partners Finance Corp., Sr. Unsec. Gtd. Global Notes, 6.00%, 10/01/2022 | 510,000 | 512,550 | ||||||
SESI, L.L.C., Sr. Unsec. Gtd. Global Notes, 7.13%, 12/15/2021 | 487,000 | 496,131 | ||||||
Weatherford International Ltd., Sr. Unsec. Gtd. Notes, | ||||||||
6.50%, 08/01/2036 | 365,000 | 279,225 | ||||||
8.25%, 06/15/2023 | 405,000 | 381,713 | ||||||
1,669,619 | ||||||||
Oil & Gas Exploration & Production–1.99% | ||||||||
Antero Resources Corp., Sr. Unsec. Gtd. Global Notes, 5.63%, 06/01/2023 | 571,000 | 585,989 | ||||||
Ascent Resources — Utica, LLC /ARU Finance Corp., Sr. Unsec. Notes, 10.00%, 04/01/2022(b) | 446,000 | 481,680 | ||||||
California Resources Corp., Sec. Gtd. Second Lien Notes, 8.00%, 12/15/2022(b) | 328,000 | 283,720 | ||||||
Callon Petroleum Co., Sr. Unsec. Gtd. Global Notes, 6.13%, 10/01/2024 | 699,000 | 716,475 | ||||||
Continental Resources Inc., Sr. Unsec. Gtd. Global Notes, | 452,000 | 442,395 | ||||||
Denbury Resources Inc., Sr. Unsec. Gtd. Sub. Notes, 5.50%, 05/01/2022 | 198,000 | 173,745 | ||||||
EP Energy LLC/Everest Acquisition Finance Inc., Sr. Sec. Gtd. First Lien Notes, 8.00%, 11/29/2024(b) | 611,000 | 635,440 |
Principal Amount | Value | |||||||
Oil & Gas Exploration & Production–(continued) | ||||||||
Gulfport Energy Corp., Sr. Unsec. Gtd. Global Notes, | $ | 216,000 | $ | 206,280 | ||||
6.63%, 05/01/2023 | 230,000 | 232,300 | ||||||
Jagged Peak Energy LLC, Sr. Unsec. Gtd. Notes, 5.88%, 05/01/2026(b) | 251,000 | 252,412 | ||||||
Newfield Exploration Co., Sr. Unsec. Global Notes, 5.63%, 07/01/2024 | 357,000 | 380,205 | ||||||
Oasis Petroleum Inc., Sr. Unsec. Gtd. Global Notes, 6.88%, 01/15/2023 | 647,000 | 666,410 | ||||||
Parsley Energy LLC/Parsley Finance Corp., Sr. Unsec. Gtd. Notes, 6.25%, 06/01/2024(b) | 880,000 | 921,800 | ||||||
QEP Resources, Inc., |
| |||||||
Sr. Unsec. Global Notes, 5.25%, 05/01/2023 | 483,000 | 473,340 | ||||||
5.63%, 03/01/2026 | 338,000 | 324,902 | ||||||
Sr. Unsec. Notes, | 278,000 | 300,240 | ||||||
Range Resources Corp., Sr. Unsec. Gtd. Global Notes, 4.88%, 05/15/2025 | 1,116,000 | 1,038,577 | ||||||
RSP Permian, Inc., Sr. Unsec. Gtd. Global Notes, 5.25%, 01/15/2025 | 359,000 | 372,462 | ||||||
SM Energy Co., Sr. Unsec. Global Notes, 6.13%, 11/15/2022 | 345,000 | 350,175 | ||||||
6.75%, 09/15/2026 | 225,000 | 230,063 | ||||||
Southwestern Energy Co., Sr. Unsec. Gtd. Global Notes, | 392,000 | 382,200 | ||||||
7.50%, 04/01/2026 | 313,000 | 323,173 | ||||||
Tullow Oil PLC (Ghana), Sr. Unsec. Notes, 7.00%, 03/01/2025(b) | 295,000 | 299,440 | ||||||
Whiting Petroleum Corp., Sr. Unsec. Gtd. Global Notes, 6.25%, 04/01/2023 | 900,000 | 928,125 | ||||||
WildHorse Resource Development Corp., Sr. Unsec. Gtd. Global Notes, 6.88%, 02/01/2025 | 628,000 | 640,560 | ||||||
WPX Energy Inc., Sr. Unsec. Notes, 5.25%, 09/15/2024 | 569,000 | 576,112 | ||||||
12,218,220 | ||||||||
Oil & Gas Refining & Marketing–0.12% | ||||||||
Parkland Fuel Corp. (Canada), Sr. Unsec. Notes, 6.00%, 04/01/2026(b) | 345,000 | 345,863 | ||||||
Sunoco LP/Sunoco Finance Corp., Sr. Unsec. Gtd. Notes, 4.88%, 01/15/2023(b) | 385,000 | 379,983 | ||||||
725,846 | ||||||||
Oil & Gas Storage & Transportation–0.68% | ||||||||
Energy Transfer Equity, L.P., Sr. Sec. First Lien Notes, 5.88%, 01/15/2024 | 644,000 | 659,295 | ||||||
Energy Transfer Partners, L.P., Series A, Jr. Unsec. Sub. Global Notes, 6.25%(c) | 363,000 | 346,547 | ||||||
Holly Energy Partners L.P./Holly Energy Finance Corp., Sr. Unsec. Gtd. Notes, 6.00%, 08/01/2024(b) | 537,000 | 541,027 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco Multi-Asset Income Fund
Principal Amount | Value | |||||||
Oil & Gas Storage & Transportation–(continued) | ||||||||
NGPL PipeCo. LLC, Sr. Unsec. Bonds, 4.88%, 08/15/2027(b) | $ | 320,000 | $ | 312,300 | ||||
Plains All American Pipeline, L.P., Series B, Jr. Unsec. Sub. Notes, | 351,000 | 341,786 | ||||||
SemGroup Corp., Sr. Unsec. Gtd. Global Notes, 6.38%, 03/15/2025 | 535,000 | 512,263 | ||||||
Targa Resources Partners L.P./Targa Resources Partners Finance Corp., | ||||||||
Sr. Unsec. Gtd. Global Bonds, 5.13%, 02/01/2025 | 542,000 | 527,095 | ||||||
5.25%, 05/01/2023 | 114,000 | 114,000 | ||||||
Sr. Unsec. Gtd. Notes, 5.88%, 04/15/2026(b) | 227,000 | 226,149 | ||||||
Williams Cos., Inc. (The), Sr. Unsec. Global Notes, 4.55%, 06/24/2024 | 591,000 | 591,739 | ||||||
4,172,201 | ||||||||
Other Diversified Financial Services–0.18% | ||||||||
Lincoln Finance Ltd. (Netherlands), Sr. Sec. Gtd. First Lien Notes, 7.38%, 04/15/2021(b) | 200,000 | 207,500 | ||||||
Lions Gate Capital Holdings LLC, Sr. Unsec. Gtd. Notes, 5.88%, 11/01/2024(b) | 395,000 | 406,356 | ||||||
LPL Holdings Inc., Sr. Unsec. Gtd. Notes, 5.75%, 09/15/2025(b) | 390,000 | 379,275 | ||||||
VFH Parent LLC/Orchestra Co-Issuer Inc., Sec. Gtd. Second Lien Notes, 6.75%, 06/15/2022(b) | 101,000 | 105,010 | ||||||
1,098,141 | ||||||||
Packaged Foods & Meats–0.33% | ||||||||
B&G Foods, Inc., Sr. Unsec. Gtd. Notes, 5.25%, 04/01/2025 | 286,000 | 262,405 | ||||||
JBS Investments GmbH (Brazil), Sr. Unsec. Gtd. Notes, 7.25%, 04/03/2024(b) | 590,000 | 583,923 | ||||||
Lamb Weston Holdings, Inc., Sr. Unsec. Gtd. Notes, 4.63%, 11/01/2024(b) | 540,000 | 537,975 | ||||||
TreeHouse Foods, Inc., Sr. Unsec. Gtd. Notes, 6.00%, 02/15/2024(b) | 648,000 | 647,190 | ||||||
2,031,493 | ||||||||
Paper Packaging–0.07% | ||||||||
Plastipak Holdings Inc., Sr. Unsec. Notes, 6.25%, 10/15/2025(b) | 461,000 | 449,475 | ||||||
Paper Products–0.09% | ||||||||
Mercer International Inc. (Canada), |
| |||||||
Sr. Unsec. Global Notes, 6.50%, 02/01/2024 | 329,000 | 342,983 | ||||||
7.75%, 12/01/2022 | 24,000 | 25,290 | ||||||
Sr. Unsec. Notes, 5.50%, 01/15/2026(b) | 163,000 | 160,555 | ||||||
528,828 | ||||||||
Pharmaceuticals–0.53% | ||||||||
Endo DAC/Endo Finance LLC/Endo Finco Inc., Sr. Unsec. Gtd. Notes, 6.00%, 07/15/2023(b) | 200,000 | 146,500 |
Principal Amount | Value | |||||||
Pharmaceuticals–(continued) | ||||||||
Teva Pharmaceutical Finance IV, B.V. (Israel), Sr. Unsec. Gtd. Global Notes, 3.65%, 11/10/2021 | $ | 450,000 | $ | 418,782 | ||||
Teva Pharmaceutical Finance Netherlands III B.V. (Israel), Sr. Unsec. Gtd. Notes, 6.00%, 04/15/2024(b) | 268,000 | 260,273 | ||||||
Valeant Pharmaceuticals International, Inc., |
| |||||||
Sr. Sec. Gtd. First Lien Notes, 5.50%, 11/01/2025(b) | 307,000 | 306,616 | ||||||
Sr. Unsec. Gtd. Notes, 5.63%, 12/01/2021(b) | 1,630,000 | 1,583,138 | ||||||
6.13%, 04/15/2025(b) | 100,000 | 90,572 | ||||||
7.25%, 07/15/2022(b) | 155,000 | 156,922 | ||||||
7.50%, 07/15/2021(b) | 250,000 | 255,000 | ||||||
3,217,803 | ||||||||
Publishing–0.15% | ||||||||
Meredith Corp., Sr. Unsec. Notes, 6.88%, 02/01/2026(b) | 886,000 | 899,290 | ||||||
Railroads–0.15% | ||||||||
Kenan Advantage Group Inc. (The), Sr. Unsec. Notes, 7.88%, 07/31/2023(b) | 876,000 | 893,520 | ||||||
Regional Banks–0.12% | ||||||||
CIT Group Inc., | 106,000 | 108,650 | ||||||
5.00%, 08/01/2023 | 510,000 | 518,925 | ||||||
Unsec. Sub. Global Notes, 6.13%, 03/09/2028 | 87,000 | 90,154 | ||||||
717,729 | ||||||||
Restaurants–0.41% | ||||||||
1011778 BC ULC/ New Red Finance, Inc. (Canada), Sec. Gtd. Second Lien Notes, 5.00%, 10/15/2025(b) | 1,447,000 | 1,399,524 | ||||||
Carrols Restaurant Group, Inc., Sec. Gtd. Second Lien Global Notes, 8.00%, 05/01/2022 | 276,000 | 288,075 | ||||||
IRB Holding Corp., Sr. Unsec. Gtd. Notes, 6.75%, 02/15/2026(b) | 603,000 | 583,402 | ||||||
KFC Holding Co./Pizza Hut Holdings LLC/Taco Bell of America LLC, Sr. Unsec. Gtd. Notes, 4.75%, 06/01/2027(b) | 240,000 | 231,300 | ||||||
2,502,301 | ||||||||
Security & Alarm Services–0.05% | ||||||||
Brink’s Co. (The), Sr. Unsec. Gtd. Notes, 4.63%, 10/15/2027(b) | 322,000 | 297,045 | ||||||
Semiconductor Equipment–0.04% | ||||||||
Entegris Inc., Sr. Unsec. Gtd. Notes, 4.63%, 02/10/2026(b) | 224,000 | 217,280 | ||||||
Semiconductors–0.13% | ||||||||
NXP B.V./NXP Funding LLC (Netherlands), Sr. Unsec. Gtd. Notes, 4.63%, 06/01/2023(b) | 785,000 | 792,222 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco Multi-Asset Income Fund
Principal Amount | Value | |||||||
Sovereign Debt–15.16% | ||||||||
Abu Dhabi Government International Bond (United Arab Emirates), REGS, Sr. Unsec. Euro Notes, | ||||||||
3.13%, 10/11/2027(b) | $ | 900,000 | $ | 835,211 | ||||
4.13%, 10/11/2047(b) | 900,000 | 824,023 | ||||||
Argentine Republic Government International Bond (Argentina), Sr. Unsec. Global Bonds, | ||||||||
7.13%, 07/06/2036 | 900,000 | 857,250 | ||||||
7.63%, 04/22/2046 | 850,000 | 822,375 | ||||||
REGS, Sr. Unsec. Euro Notes, 7.13%, 06/28/2117(b) | 918,000 | 817,938 | ||||||
Bahrain Government International Bond (Bahrain), | ||||||||
6.00%, 09/19/2044(b) | 1,000,000 | 807,692 | ||||||
7.50%, 09/20/2047(b) | 800,000 | 725,871 | ||||||
Sr. Unsec. Euro Notes, 6.75%, 09/20/2029(b) | 900,000 | 832,095 | ||||||
Brazilian Government International Bond (Brazil), Sr. Unsec. Global Bonds, | ||||||||
5.63%, 01/07/2041 | 900,000 | 857,709 | ||||||
5.63%, 02/21/2047 | 900,000 | 849,150 | ||||||
8.25%, 01/20/2034 | 625,000 | 775,163 | ||||||
Chile Government International Bond (Chile), Sr. Unsec. Global Notes, | ||||||||
3.13%, 01/21/2026 | 900,000 | 868,500 | ||||||
3.24%, 02/06/2028 | 900,000 | 862,650 | ||||||
3.86%, 06/21/2047 | 900,000 | 848,250 | ||||||
China Government International Bond (China), REGS, Sr. Unsec. Euro Bonds, | ||||||||
2.13%, 11/02/2022(b) | 1,200,000 | 1,161,876 | ||||||
2.63%, 11/02/2027(b) | 1,200,000 | 1,151,413 | ||||||
Colombia Government International Bond (Colombia), Sr. Unsec. Global Bonds, | ||||||||
5.63%, 02/26/2044 | 800,000 | 859,600 | ||||||
6.13%, 01/18/2041 | 700,000 | 792,750 | ||||||
7.38%, 09/18/2037 | 700,000 | 890,750 | ||||||
Costa Rica Government International Bond (Costa Rica), REGS, Sr. Unsec. Euro Notes, | ||||||||
5.63%, 04/30/2043(b) | 900,000 | 780,021 | ||||||
7.00%, 04/04/2044(b) | 800,000 | 801,000 | ||||||
7.16%, 03/12/2045(b) | 800,000 | 813,208 | ||||||
Croatia Government International Bond (Croatia), REGS, Sr. Unsec. Euro Notes, | ||||||||
5.50%, 04/04/2023(b) | 800,000 | 849,904 | ||||||
6.00%, 01/26/2024(b) | 800,000 | 873,390 | ||||||
6.38%, 03/24/2021(b) | 700,000 | 752,213 | ||||||
Dominican Republic International Bond (Dominican Republic), | ||||||||
7.45%, 04/30/2044(b) | 700,000 | 770,000 | ||||||
Sr. Unsec. Euro Notes, 6.50%, 02/15/2048(b) | 800,000 | 796,300 | ||||||
6.85%, 01/27/2045(b) | 750,000 | 777,188 |
Principal Amount | Value | |||||||
Sovereign Debt–(continued) | ||||||||
Ecuador Government International Bond (Ecuador), | ||||||||
9.65%, 12/13/2026(b) | $ | 800,000 | $ | 791,000 | ||||
Sr. Unsec. Euro Notes, | 800,000 | 757,000 | ||||||
9.63%, 06/02/2027(b) | 800,000 | 787,000 | ||||||
Egypt Government International Bond (Egypt), | ||||||||
8.50%, 01/31/2047(b) | 800,000 | 859,590 | ||||||
Sr. Unsec. Euro Notes, | 800,000 | 764,046 | ||||||
7.90%, 02/21/2048(b) | 800,000 | 813,033 | ||||||
El Salvador Government International Bond (El Salvador), REGS, Sr. Unsec. Euro Notes, | ||||||||
7.63%, 02/01/2041(b) | 750,000 | 783,893 | ||||||
7.65%, 06/15/2035(b) | 800,000 | 836,000 | ||||||
8.25%, 04/10/2032(b) | 747,000 | 826,944 | ||||||
Emirate of Dubai Government International Bonds (United Arab Emirates), REGS, Sr. Unsec. Medium-Term Euro Notes, 5.25%, 01/30/2043(b) | 800,000 | 764,880 | ||||||
Hungary Government International Bond (Hungary), | ||||||||
5.38%, 03/25/2024 | 710,000 | 764,656 | ||||||
5.75%, 11/22/2023 | 800,000 | 874,197 | ||||||
7.63%, 03/29/2041 | 560,000 | 790,616 | ||||||
Indonesia Government International Bond (Indonesia), REGS, Sr. Unsec. Euro Bonds, | ||||||||
6.63%, 02/17/2037(b) | 700,000 | 835,650 | ||||||
7.75%, 01/17/2038(b) | 650,000 | 867,904 | ||||||
8.50%, 10/12/2035(b) | 550,000 | 771,423 | ||||||
Jordan Government International Bond (Jordan), | ||||||||
7.38%, 10/10/2047(b) | 800,000 | 781,906 | ||||||
Sr. Unsec. Euro Notes, | 800,000 | 761,818 | ||||||
6.13%, 01/29/2026(b) | 800,000 | 785,420 | ||||||
Kazakhstan Government International Bond (Kazakhstan), | ||||||||
4.88%, 10/14/2044(b) | 850,000 | 837,348 | ||||||
Sr. Unsec. Medium-Term Euro Notes, 5.13%, 07/21/2025(b) | 750,000 | 801,071 | ||||||
6.50%, 07/21/2045(b) | 700,000 | 836,220 | ||||||
Lebanon Government International Bond (Lebanon), | ||||||||
7.25%, 03/23/2037(b) | 909,000 | 811,137 | ||||||
Sr. Unsec. Euro Notes, | 828,000 | 749,314 | ||||||
Sr. Unsec. Medium-Term Global Euro Notes, 6.65%, 02/26/2030(b) | 969,000 | 848,553 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
12 Invesco Multi-Asset Income Fund
Principal Amount | Value | |||||||
Sovereign Debt–(continued) | ||||||||
Lithuania Government International Bond (Lithuania), | ||||||||
6.13%, 03/09/2021(b) | $ | 1,100,000 | $ | 1,184,623 | ||||
6.63%, 02/01/2022(b) | 1,150,000 | 1,281,387 | ||||||
Mexico Government International Bond (Mexico), | ||||||||
4.60%, 01/23/2046 | 950,000 | 873,050 | ||||||
Sr. Unsec. Medium-Term Global Notes, 5.75%, 10/12/2110 | 800,000 | 790,000 | ||||||
Series A, Sr. Unsec. Medium-Term Global Notes, 6.05%, 01/11/2040 | 712,000 | 785,158 | ||||||
Nigeria Government International Bond (Nigeria), REGS, Sr. Unsec. Euro Notes, | ||||||||
7.70%, 02/23/2038(b) | 800,000 | 824,000 | ||||||
7.88%, 02/16/2032(b) | 800,000 | 863,656 | ||||||
Sr. Unsec. Medium-Term Euro Notes, 7.63%, 11/28/2047(b) | 800,000 | 807,640 | ||||||
Oman Government International Bond (Oman), REGS, Sr. Unsec. Euro Notes, | ||||||||
5.63%, 01/17/2028(b) | 1,000,000 | 956,936 | ||||||
6.50%, 03/08/2047(b) | 800,000 | 739,664 | ||||||
6.75%, 01/17/2048(b) | 800,000 | 755,122 | ||||||
Pakistan Government International Bond (Pakistan), REGS, Sr. Unsec. Euro Notes, | ||||||||
6.88%, 12/05/2027(b) | 800,000 | 751,233 | ||||||
8.25%, 04/15/2024(b) | 800,000 | 834,525 | ||||||
8.25%, 09/30/2025(b) | 810,000 | 843,448 | ||||||
Panama Government International Bond (Panama), Sr. Unsec. Global Bonds, | ||||||||
3.88%, 03/17/2028 | 800,000 | 788,000 | ||||||
7.13%, 01/29/2026 | 750,000 | 899,062 | ||||||
8.88%, 09/30/2027 | 569,000 | 778,108 | ||||||
Paraguay Government International Bond (Paraguay), | ||||||||
5.00%, 04/15/2026(b) | 800,000 | 813,200 | ||||||
Sr. Unsec. Euro Notes, 4.70%, 03/27/2027(b) | 800,000 | 798,000 | ||||||
6.10%, 08/11/2044(b) | 800,000 | 872,000 | ||||||
Peruvian Government International Bond (Peru), Sr. Unsec. Global Bonds, | ||||||||
4.13%, 08/25/2027 | 861,000 | 886,830 | ||||||
5.63%, 11/18/2050 | 652,000 | 765,448 | ||||||
8.75%, 11/21/2033 | 521,000 | 768,475 | ||||||
Philippine Government International Bond (Philippines), | ||||||||
6.38%, 10/23/2034 | 650,000 | 817,053 | ||||||
9.50%, 02/02/2030 | 587,000 | 871,119 | ||||||
Sr. Unsec. Global Notes, 7.75%, 01/14/2031 | 600,000 | 807,677 | ||||||
Qatar Government International Bond (Qatar), | ||||||||
4.63%, 06/02/2046(b) | 900,000 | 848,250 | ||||||
Sr. Unsec. Euro Notes, 5.75%, 01/20/2042(b) | 725,000 | 799,475 | ||||||
6.40%, 01/20/2040(b) | 700,000 | 829,001 |
Principal Amount | Value | |||||||
Sovereign Debt–(continued) | ||||||||
Republic of Poland Government International Bond (Poland), | ||||||||
3.00%, 03/17/2023 | $ | 824,000 | $ | 811,492 | ||||
Sr. Unsec. Global Notes, 3.25%, 04/06/2026 | 854,000 | 832,142 | ||||||
4.00%, 01/22/2024 | 795,000 | 815,299 | ||||||
Republic of South Africa Government International Bond (South Africa), Sr. Unsec. Global Bonds, | ||||||||
5.00%, 10/12/2046 | 900,000 | 796,351 | ||||||
5.38%, 07/24/2044 | 850,000 | 794,287 | ||||||
Sr. Unsec. Global Notes, 6.25%, 03/08/2041 | 800,000 | 836,642 | ||||||
Romanian Government International Bond (Romania), REGS, Sr. Unsec. Medium-Term Euro Notes, | ||||||||
4.38%, 08/22/2023(b) | 796,000 | 809,317 | ||||||
4.88%, 01/22/2024(b) | 752,000 | 782,315 | ||||||
6.13%, 01/22/2044(b) | 730,000 | 849,486 | ||||||
Russian Foreign Bond (Russia), REGS, Sr. Unsec. Euro Bonds, | ||||||||
4.88%, 09/16/2023(b) | 800,000 | 829,600 | ||||||
5.63%, 04/04/2042(b) | 800,000 | 841,380 | ||||||
5.88%, 09/16/2043(b) | 800,000 | 868,800 | ||||||
Saudi Government International Bond (Saudi Arabia), REGS, Sr. Unsec. Medium-Term Euro Notes, | ||||||||
3.63%, 03/04/2028(b) | 900,000 | 843,787 | ||||||
4.50%, 10/26/2046(b) | 900,000 | 816,111 | ||||||
4.63%, 10/04/2047(b) | 800,000 | 733,856 | ||||||
Serbia International Bond (Serbia), REGS, Sr. Unsec. Euro Notes, 7.25%, 09/28/2021(b) | 1,100,000 | 1,216,818 | ||||||
Slovenia Government International Bond (Slovenia), REGS, Sr. Unsec. Euro Notes, 5.25%, 02/18/2024(b) | 1,200,000 | 1,319,881 | ||||||
Sri Lanka Government International Bond (Sri Lanka), | ||||||||
6.83%, 07/18/2026(b) | 850,000 | 863,853 | ||||||
6.85%, 11/03/2025(b) | 750,000 | 767,892 | ||||||
Sr. Unsec. Euro Notes, 6.13%, 06/03/2025(b) | 850,000 | 840,467 | ||||||
Trinidad & Tobago Government International Bond (Trinidad & Tobago), | ||||||||
4.50%, 08/04/2026(b) | 1,200,000 | 1,230,000 | ||||||
Unsec. Euro Notes, 4.38%, 01/16/2024(b) | 1,200,000 | 1,219,080 | ||||||
Turkey Government International Bond (Turkey), Sr. Unsec. Global Notes, | ||||||||
6.88%, 03/17/2036 | 748,000 | 770,351 | ||||||
7.25%, 03/05/2038 | 700,000 | 749,029 | ||||||
8.00%, 02/14/2034 | 760,000 | 874,473 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
13 Invesco Multi-Asset Income Fund
Principal Amount | Value | |||||||
Sovereign Debt–(continued) | ||||||||
Ukraine Government International Bond (Ukraine), REGS, Sr. Unsec. Euro Notes, | ||||||||
7.75%, 09/01/2025(b) | $ | 800,000 | $ | 796,360 | ||||
7.75%, 09/01/2026(b) | 800,000 | 791,112 | ||||||
7.75%, 09/01/2027(b) | 800,000 | 786,960 | ||||||
92,873,390 | ||||||||
Specialized Consumer Services–0.19% | ||||||||
ServiceMaster Co., LLC (The), | ||||||||
Sr. Unsec. Gtd. Notes, 5.13%, 11/15/2024(b) | 942,000 | 919,863 | ||||||
Sr. Unsec. Notes, | 254,000 | 272,732 | ||||||
1,192,595 | ||||||||
Specialized Finance–0.14% | ||||||||
AerCap Global Aviation Trust (Ireland), Jr. Unsec. Gtd. Sub. Notes, 6.50%, 06/15/2045(b) | 200,000 | 213,000 | ||||||
Aircastle Ltd., | ||||||||
Sr. Unsec. Global Notes, 7.63%, 04/15/2020 | 70,000 | 75,163 | ||||||
Sr. Unsec. Notes, 5.00%, 04/01/2023 | 383,000 | 394,490 | ||||||
5.50%, 02/15/2022 | 187,000 | 196,350 | ||||||
879,003 | ||||||||
Specialized REITs–0.48% | ||||||||
Equinix Inc., Sr. Unsec. Notes, 5.88%, 01/15/2026 | 1,045,000 | 1,084,187 | ||||||
Iron Mountain Inc., |
| |||||||
Sr. Unsec. Gtd. Notes, 6.00%, 08/15/2023 | 203,000 | 210,105 | ||||||
Sr. Unsec. Sub. Gtd. Global Notes, 5.75%, 08/15/2024 | 115,000 | 114,138 | ||||||
Iron Mountain US Holdings, Inc., Sr. Unsec. Gtd. Notes, 5.38%, 06/01/2026(b) | 303,000 | 293,910 | ||||||
Rayonier A.M. Products Inc., Sr. Unsec. Gtd. Notes, 5.50%, 06/01/2024(b) | 865,000 | 841,212 | ||||||
SBA Communications Corp., |
| |||||||
Sr. Unsec. Global Notes, 4.88%, 07/15/2022 | 79,000 | 79,395 | ||||||
4.88%, 09/01/2024 | 326,000 | 314,183 | ||||||
2,937,130 | ||||||||
Specialty Chemicals–0.24% | ||||||||
Axalta Coating Systems, LLC, Sr. Unsec. Gtd. Notes, 4.88%, 08/15/2024(b) | 300,000 | 303,000 | ||||||
Kraton Polymers LLC/Kraton Polymers Capital Corp., Sr. Unsec. Gtd. Notes, 10.50%, 04/15/2023(b) | 402,000 | 445,717 | ||||||
Platform Specialty Products Corp., Sr. Unsec. Gtd. Notes, 5.88%, 12/01/2025(b) | 735,000 | 717,544 | ||||||
1,466,261 |
Principal Amount | Value | |||||||
Steel–0.32% | ||||||||
Cleveland-Cliffs Inc., Sr. Unsec. Gtd. Notes, 5.75%, 03/01/2025(b) | $ | 663,000 | $ | 641,870 | ||||
Steel Dynamics, Inc., Sr. Unsec. Gtd. Global Notes, | ||||||||
5.00%, 12/15/2026 | 374,000 | 371,195 | ||||||
5.50%, 10/01/2024 | 75,000 | 77,250 | ||||||
United States Steel Corp., Sr. Unsec. Global Notes, 6.88%, 08/15/2025 | 821,000 | 841,525 | ||||||
1,931,840 | ||||||||
Technology Distributors–0.09% | ||||||||
CDW LLC/CDW Finance Corp., Sr. Unsec. Gtd. Notes, 5.00%, 09/01/2025 | 552,000 | 553,214 | ||||||
Technology Hardware, Storage & Peripherals–0.29% | ||||||||
Dell International LLC/ EMC Corp., |
| |||||||
Sr. Sec. Gtd. First Lien Notes, 8.35%, 07/15/2046(b) | 180,000 | 221,775 | ||||||
Sr. Unsec. Gtd. Notes, 7.13%, 06/15/2024(b) | 1,135,000 | 1,209,853 | ||||||
Diebold Nixdorf, Inc., Sr. Unsec. Gtd. Global Notes, 8.50%, 04/15/2024 | 350,000 | 364,437 | ||||||
1,796,065 | ||||||||
Textiles–0.07% | ||||||||
Eagle Intermediate Global Holding B.V./Ruyi US Finance LLC (China), Sr. Sec. Gtd. First Lien Bonds, 7.50%, 05/01/2025(b) | 439,000 | 451,073 | ||||||
Trading Companies & Distributors–0.41% | ||||||||
BMC East, LLC, Sr. Sec. Gtd. First Lien Notes, 5.50%, 10/01/2024(b) | 576,000 | 572,400 | ||||||
H&E Equipment Services, Inc., Sr. Unsec. Gtd. Global Notes, 5.63%, 09/01/2025 | 717,000 | 722,377 | ||||||
Herc Rentals Inc., Sec. Gtd. Second Lien Notes, 7.75%, 06/01/2024(b) | 501,000 | 542,959 | ||||||
United Rentals North America, Inc., |
| |||||||
Sr. Unsec. Gtd. Global Notes, 5.50%, 07/15/2025 | 50,000 | 51,312 | ||||||
Sr. Unsec. Gtd. Notes, 5.50%, 05/15/2027 | 151,000 | 151,000 | ||||||
5.88%, 09/15/2026 | 475,000 | 496,969 | ||||||
2,537,017 | ||||||||
Trucking–0.07% | ||||||||
Avis Budget Car Rental LLC/Avis Budget Finance Inc., Sr. Unsec. Gtd. Notes, | ||||||||
5.25%, 03/15/2025(b) | 180,000 | 173,925 | ||||||
6.38%, 04/01/2024(b) | 230,000 | 234,025 | ||||||
407,950 | ||||||||
Wireless Telecommunication Services–0.88% | ||||||||
CB Escrow Corp., Sr. Unsec. Notes, 8.00%, 10/15/2025(b) | 72,000 | 68,760 | ||||||
Digicel Group Ltd. (Jamaica), Sr. Unsec. Notes, 8.25%, 09/30/2020(b) | 403,000 | 361,692 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
14 Invesco Multi-Asset Income Fund
Principal Amount | Value | |||||||
Wireless Telecommunication Services–(continued) | ||||||||
Sprint Communications Inc., Sr. Unsec. Global Notes, 11.50%, 11/15/2021 | $ | 235,000 | $ | 282,000 | ||||
Sprint Corp., Sr. Unsec. Gtd. Global Notes, | ||||||||
7.25%, 09/15/2021 | 1,304,000 | 1,385,500 | ||||||
7.63%, 02/15/2025 | 84,000 | 88,620 | ||||||
7.88%, 09/15/2023 | 1,558,000 | 1,674,850 | ||||||
T-Mobile USA, Inc., Sr. Unsec. Gtd. Global Bonds, 6.50%, 01/15/2026 | 1,465,000 | 1,560,225 | ||||||
5,421,647 | ||||||||
Total U.S. Dollar Denominated Bonds & Notes (Cost $245,411,463) | 240,210,608 | |||||||
Shares | ||||||||
Preferred Stocks–21.59% |
| |||||||
Alternative Carriers–0.76% | ||||||||
Qwest Corp., 6.13% Pfd. | 23,800 | 474,810 | ||||||
Qwest Corp., 6.50% Pfd. | 52,500 | 1,108,800 | ||||||
Qwest Corp., 6.63% Pfd. | 33,400 | 708,748 | ||||||
Qwest Corp., 6.75% Pfd. | 50,100 | 1,080,156 | ||||||
Qwest Corp., 6.88% Pfd. | 23,800 | 520,506 | ||||||
Qwest Corp., 7.00% Pfd. | 9,500 | 222,110 | ||||||
Qwest Corp., 7.00% Pfd. | 14,300 | 325,611 | ||||||
Qwest Corp., 7.50% Pfd. | 8,256 | 207,391 | ||||||
4,648,132 | ||||||||
Asset Management & Custody Banks–1.23% | ||||||||
Apollo Global Management LLC, Series A, 6.38% Pfd. | 12,600 | 304,290 | ||||||
Apollo Global Management LLC, Series B, 6.38% Pfd. | 13,800 | 333,960 | ||||||
Apollo Investment Corp., 6.88% Pfd. | 7,400 | 186,110 | ||||||
Ares Management, L.P., Series A, 7.00% Pfd. | 15,300 | 398,565 | ||||||
Bank of New York Mellon Corp. (The), 5.20% Pfd. | 26,300 | 660,130 | ||||||
BrightSphere Investment Group PLC, 5.13% Pfd. | 6,600 | 146,652 | ||||||
Carlyle Group LP (The), Series A, 5.88% Pfd. | 18,500 | 433,825 | ||||||
KKR & Co. L.P., Series A, 6.75% Pfd. | 12,400 | 321,780 | ||||||
KKR & Co. L.P., Series B, 6.50% Pfd. | 12,400 | 316,448 | ||||||
Legg Mason, Inc., 5.45% Pfd. | 23,100 | 552,552 | ||||||
Legg Mason, Inc., 6.38% Pfd. | 11,600 | 300,904 | ||||||
Northern Trust Corp., Series C, 5.85% Pfd. | 19,100 | 502,712 | ||||||
Prospect Capital Corp., 6.25% Pfd. | 7,400 | 188,337 | ||||||
State Street Corp., Series C, 5.25% Pfd. | 13,800 | 346,380 | ||||||
State Street Corp., Series D, 5.90% Pfd. | 23,100 | 609,609 | ||||||
State Street Corp., Series E, 6.00% Pfd. | 47,700 | 1,242,585 | ||||||
State Street Corp., Series G, 5.35% Pfd. | 27,800 | 713,348 | ||||||
7,558,187 |
Shares | Value | |||||||
Consumer Finance–0.71% | ||||||||
Capital One Financial Corp., Series B, 6.00% Pfd. | 23,800 | $ | 599,760 | |||||
Capital One Financial Corp., Series C, 6.25% Pfd. | 14,300 | 368,368 | ||||||
Capital One Financial Corp., Series D, 6.70% Pfd. | 19,100 | 501,948 | ||||||
Capital One Financial Corp., Series F, 6.20% Pfd. | 19,100 | 500,611 | ||||||
Capital One Financial Corp., Series G, 5.20% Pfd. | 41,800 | 1,014,068 | ||||||
Capital One Financial Corp., Series H, 6.00% Pfd. | 41,800 | 1,080,948 | ||||||
Navient Corp., 6.00% Pfd. | 14,300 | 311,883 | ||||||
4,377,586 | ||||||||
Diversified Banks–6.94% | ||||||||
Bank of America Corp., Series 3, 6.38% Pfd. | 3,300 | 84,711 | ||||||
Bank of America Corp., Series I, 6.63% Pfd. | 14,351 | 368,821 | ||||||
Bank of America Corp., Series W, 6.63% Pfd. | 106,400 | 2,790,872 | ||||||
Bank of America Corp., Series Y, 6.50% Pfd. | 92,500 | 2,424,425 | ||||||
Bank of America Corp., Series CC, 6.20% Pfd. | 90,200 | 2,332,572 | ||||||
Bank of America Corp., Series EE, 6.00% Pfd. | 87,900 | 2,265,183 | ||||||
Barclays Bank PLC (United Kingdom), Series 5, 8.13% Pfd. | 40,000 | 1,045,600 | ||||||
Citigroup Inc., Series J, 7.13% Pfd. | 55,000 | 1,532,850 | ||||||
Citigroup Inc., Series K, 6.88% Pfd. | 55,500 | 1,527,360 | ||||||
Citigroup Inc., Series L, 6.88% Pfd. | 23,800 | 624,274 | ||||||
Citigroup Inc., Series S, 6.30% Pfd. | 62,500 | 1,641,250 | ||||||
HSBC Holdings PLC (United Kingdom), Series 2, 8.00% Pfd. | 68,000 | 1,787,720 | ||||||
ING Groep NV (Netherlands), 6.38% Pfd. | 30,000 | 767,400 | ||||||
JPMorgan Chase & Co., Series P, 5.45% Pfd. | 9,500 | 240,825 | ||||||
JPMorgan Chase & Co., Series T, 6.70% Pfd. | 14,300 | 378,092 | ||||||
JPMorgan Chase & Co., Series W, 6.30% Pfd. | 14,300 | 375,089 | ||||||
JPMorgan Chase & Co., Series Y, 6.13% Pfd. | 69,400 | 1,818,280 | ||||||
JPMorgan Chase & Co., Series AA, 6.10% Pfd. | 92,500 | 2,425,350 | ||||||
JPMorgan Chase & Co., Series BB, 6.15% Pfd. | 92,500 | 2,426,275 | ||||||
Royal Bank of Scotland Group PLC (The) (United Kingdom), Series S, 6.60% Pfd. | 22,100 | 566,423 | ||||||
US Bancorp, Series F, 6.50% Pfd. | 69,400 | 1,915,440 | ||||||
Wells Fargo & Co., 5.20% Pfd. | 64,200 | 1,569,048 | ||||||
Wells Fargo & Co., 6.63% Pfd. | 35,800 | 981,278 | ||||||
Wells Fargo & Co., Class A, Series L, $75.00 Conv. Pfd. | 581 | 744,034 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
15 Invesco Multi-Asset Income Fund
Shares | Value | |||||||
Diversified Banks–(continued) | ||||||||
Wells Fargo & Co., Series J, 8.00% Pfd. | 9,500 | $ | 246,905 | |||||
Wells Fargo & Co., Series O, 5.13% Pfd. | 59,600 | 1,456,624 | ||||||
Wells Fargo & Co., Series P, 5.25% Pfd. | 23,100 | 567,105 | ||||||
Wells Fargo & Co., Series Q, 5.85% Pfd. | 33,400 | 861,720 | ||||||
Wells Fargo & Co., Series T, 6.00% Pfd. | 50,400 | 1,284,696 | ||||||
Wells Fargo & Co., Series V, 6.00% Pfd. | 38,100 | 981,837 | ||||||
Wells Fargo & Co., Series W, 5.70% Pfd. | 38,100 | 953,262 | ||||||
Wells Fargo & Co., Series X, 5.50% Pfd. | 92,500 | 2,287,525 | ||||||
Wells Fargo & Co., Series Y, 5.63% Pfd. | 50,400 | 1,252,188 | ||||||
42,525,034 | ||||||||
Diversified Capital Markets–0.42% | ||||||||
Deutsche Bank Contingent Capital Trust V (Germany), 8.05% Pfd. | 101,100 | 2,576,028 | ||||||
Diversified REITs–0.39% | ||||||||
PS Business Parks, Inc., Series U, 5.75% Pfd. | 11,000 | 271,150 | ||||||
PS Business Parks, Inc., Series W, 5.20% Pfd. | 13,100 | 294,095 | ||||||
PS Business Parks, Inc., Series X, 5.25% Pfd. | 10,500 | 240,765 | ||||||
PS Business Parks, Inc., Series Y, 5.20% Pfd. | 10,200 | 227,970 | ||||||
Spirit Realty Capital Inc., Series A, 6.00% Pfd. | 7,800 | 162,630 | ||||||
VEREIT Inc., Series F, 6.70% Pfd. | 47,700 | 1,200,609 | ||||||
2,397,219 | ||||||||
Electric Utilities–1.42% | ||||||||
Alabama Power Co., Series A, 5.00% Pfd. | 11,600 | 290,000 | ||||||
Duke Energy Corp., 5.13% Pfd. | 23,100 | 580,503 | ||||||
Entergy Arkansas, Inc., 4.88% Pfd. | 16,700 | 404,307 | ||||||
Entergy Arkansas, Inc., 4.90% Pfd. | 11,600 | 279,096 | ||||||
Entergy Louisiana, LLC, 4.88% Pfd. | 18,500 | 448,440 | ||||||
Entergy Louisiana, LLC, 5.25% Pfd. | 10,500 | 260,925 | ||||||
Entergy Mississippi, Inc., 4.90% Pfd. | 14,900 | 359,686 | ||||||
Entergy Texas Inc., 5.63% Pfd. | 9,200 | 233,220 | ||||||
Georgia Power Co., Series 2017A, 5.00% Pfd. | 14,200 | 343,356 | ||||||
Interstate Power & Light Co., Series D, 5.10% Pfd. | 9,000 | 226,350 | ||||||
Pacific Gas & Electric Co., Series A, 6.00% Pfd. | 5,300 | 131,970 | ||||||
PPL Capital Funding, Inc., Series B, 5.90% Pfd. | 21,500 | 539,220 | ||||||
SCE Trust IV, Series J, 5.38% Pfd. | 25,400 | 652,018 | ||||||
SCE Trust V, Series K, 5.45% Pfd. | 20,100 | 517,575 | ||||||
SCE Trust VI, 5.00% Pfd. | 37,000 | 833,980 | ||||||
Southern Co. (The), 5.25% Pfd. | 20,800 | 498,576 | ||||||
Southern Co. (The), 5.25% Pfd. | 47,700 | 1,160,541 | ||||||
Southern Co. (The), 6.25% Pfd. | 35,800 | 927,220 | ||||||
8,686,983 |
Shares | Value | |||||||
Health Care REITs–0.16% | ||||||||
Senior Housing Properties Trust, 5.63% Pfd. | 27,800 | $ | 666,366 | |||||
Ventas Realty L.P. / Ventas Capital Corp., 5.45% Pfd. | 12,300 | 307,254 | ||||||
973,620 | ||||||||
Industrial Conglomerates–0.14% | ||||||||
General Electric Co., 4.70% Pfd. | 34,600 | 847,700 | ||||||
Industrial Machinery–0.09% | ||||||||
Stanley Black & Decker Inc., 5.75%, Investment Units | 22,500 | 566,550 | ||||||
Integrated Telecommunication Services–0.34% | ||||||||
AT&T Inc., 5.35% Pfd. | 59,600 | 1,464,968 | ||||||
Verizon Communications Inc., 5.90% Pfd. | 23,100 | 589,743 | ||||||
2,054,711 | ||||||||
Internet Software & Services–0.15% | ||||||||
eBay Inc., 6.00% Pfd. | 35,800 | 934,380 | ||||||
Investment Banking & Brokerage–1.69% | ||||||||
BGC Partners Inc., 8.13% Pfd. | 4,400 | 113,168 | ||||||
Charles Schwab Corp. (The), Series C, 6.00% Pfd. | 26,200 | 680,938 | ||||||
Charles Schwab Corp. (The), Series D, 5.95% Pfd. | 40,500 | 1,053,405 | ||||||
Goldman Sachs Group, Inc. (The), Series J, 5.50% Pfd. | 19,100 | 490,870 | ||||||
Goldman Sachs Group, Inc. (The), Series K, 6.38% Pfd. | 45,900 | 1,270,512 | ||||||
Goldman Sachs Group, Inc. (The), Series N, 6.30% Pfd. | 47,700 | 1,246,878 | ||||||
Morgan Stanley, Series E, 7.13% Pfd. | 14,900 | 419,286 | ||||||
Morgan Stanley, Series F, 6.88% Pfd. | 28,600 | 786,500 | ||||||
Morgan Stanley, Series G, 6.63% Pfd. | 23,100 | 599,907 | ||||||
Morgan Stanley, Series I, 6.38% Pfd. | 69,400 | 1,855,756 | ||||||
Morgan Stanley, Series K, 5.85% Pfd. | 57,300 | 1,469,745 | ||||||
Stifel Financial Corp., 5.20% Pfd. | 9,300 | 225,339 | ||||||
Stifel Financial Corp., Series A, 6.25% Pfd. | 6,500 | 169,910 | ||||||
10,382,214 | ||||||||
Life & Health Insurance–0.55% | ||||||||
Aegon N.V. (Netherlands), 6.38% Pfd. | 4,600 | 118,174 | ||||||
Aegon N.V. (Netherlands), 8.00% Pfd. | 45,100 | 1,126,147 | ||||||
Prudential Financial Inc., 5.70% Pfd. | 30,100 | 753,403 | ||||||
Prudential Financial Inc., 5.75% Pfd. | 25,400 | 637,286 | ||||||
Prudential PLC (United Kingdom), 6.75% Pfd. | 12,300 | 320,538 | ||||||
Torchmark Corp., 6.13% Pfd. | 15,100 | 394,412 | ||||||
3,349,960 | ||||||||
Mortgage REITs–0.07% | ||||||||
Wells Fargo Real Estate Investment Corp., Series A, 6.38% Pfd. | 16,700 | 430,860 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
16 Invesco Multi-Asset Income Fund
Shares | Value | |||||||
Multi-Line Insurance–0.23% | ||||||||
American Financial Group, Inc., 6.00% Pfd. | 14,900 | $ | 374,139 | |||||
Hartford Financial Services Group Inc. (The), 7.88% Pfd. | 28,600 | 828,828 | ||||||
Kemper Corp., 7.38% Pfd. | 7,700 | 200,893 | ||||||
1,403,860 | ||||||||
Multi-Utilities–0.09% | ||||||||
Integrys Holding, Inc., 6.00% Pfd. | 22,050 | 570,544 | ||||||
Office REITs–0.30% | ||||||||
Boston Properties, Inc., Series B, 5.25% Pfd. | 9,000 | 220,320 | ||||||
Government Properties Income Trust, 5.88% Pfd. | 15,600 | 392,496 | ||||||
SL Green Realty Corp., Series I, 6.50% Pfd. | 11,800 | 297,124 | ||||||
Vornado Realty Trust, Series L, 5.40% Pfd. | 42,200 | 957,940 | ||||||
1,867,880 | ||||||||
Office Services & Supplies–0.08% | ||||||||
Pitney Bowes Inc., 6.70% Pfd. | 20,300 | 507,297 | ||||||
Oil & Gas Refining & Marketing–0.14% | ||||||||
NuStar Energy L.P., Series A, 8.50% Pfd. | 29,300 | 651,046 | ||||||
NuStar Energy L.P., Series C, 9.00% Pfd. | 7,700 | 176,638 | ||||||
827,684 | ||||||||
Oil & Gas Storage & Transportation–0.03% | ||||||||
Targa Resources Partners L.P., Series A, 9.00% Pfd. | 6,200 | 163,370 | ||||||
Property & Casualty Insurance–1.12% | ||||||||
Allstate Corp. (The), 5.10% Pfd. | 20,500 | 520,495 | ||||||
Allstate Corp. (The), Series A, 5.63% Pfd. | 9,200 | 231,656 | ||||||
Allstate Corp. (The), Series C, 6.75% Pfd. | 15,800 | 404,322 | ||||||
Allstate Corp. (The), Series E, 6.63% Pfd. | 35,800 | 932,948 | ||||||
Allstate Corp. (The), Series F, 6.25% Pfd. | 20,800 | 539,760 | ||||||
Arch Capital Group Ltd., Series E, 5.25% Pfd. | 19,100 | 454,007 | ||||||
Arch Capital Group Ltd., Series F, 5.45% Pfd. | 14,300 | 345,059 | ||||||
Argo Group U.S. Inc., 6.50% Pfd. | 6,800 | 172,312 | ||||||
Aspen Insurance Holdings Ltd. (Bermuda), 5.63% Pfd. | 16,700 | 403,806 | ||||||
Aspen Insurance Holdings Ltd. (Bermuda), 5.95% Pfd. | 9,500 | 242,725 | ||||||
Assured Guaranty Municipal Holdings Inc., 6.25% Pfd. | 9,900 | 247,599 | ||||||
AXIS Capital Holdings Ltd., Series E, 5.50% Pfd. | 37,000 | 896,880 | ||||||
Hanover Insurance Group, Inc. (The), 6.35% Pfd. | 8,700 | 218,631 | ||||||
Selective Insurance Group, Inc., 5.88% Pfd. | 8,700 | 217,935 | ||||||
W. R. Berkley Corp., 5.63% Pfd. | 13,800 | 335,340 |
Shares | Value | |||||||
Property & Casualty Insurance–(continued) | ||||||||
W. R. Berkley Corp., 5.75% Pfd. | 21,500 | $ | 526,965 | |||||
W. R. Berkley Corp., 5.70% Pfd. | 8,000 | 191,120 | ||||||
6,881,560 | ||||||||
Regional Banks–2.21% | ||||||||
Associated Banc-Corp, Series D, 5.38% Pfd. | 4,100 | 101,516 | ||||||
BB&T Corp., Series D, 5.85% Pfd. | 19,100 | 484,376 | ||||||
BB&T Corp., Series E, 5.63% Pfd. | 55,000 | 1,376,650 | ||||||
BB&T Corp., Series H, 5.63% Pfd. | 64,800 | 1,671,192 | ||||||
BOK Financial Corp., 5.38% Pfd. | 7,100 | 177,997 | ||||||
CIT Group Inc., Series A, 5.80% Pfd. | 70,000 | 69,825 | ||||||
Commerce Bancshares Inc., Series B, 6.00% Pfd. | 6,900 | 177,675 | ||||||
Cullen/Frost Bankers, Inc., 5.38% Pfd. | 7,100 | 177,074 | ||||||
Fifth Third Bancorp, Series I, 6.63% Pfd. | 20,800 | 590,304 | ||||||
First Horizon National Corp., Series A, 6.20% Pfd. | 5,500 | 138,215 | ||||||
First Republic Bank, Series D, 5.50% Pfd. | 9,500 | 243,200 | ||||||
First Republic Bank, Series E, 7.00% Pfd. | 4,500 | 118,485 | ||||||
First Republic Bank, Series F, 5.70% Pfd. | 10,200 | 260,712 | ||||||
First Republic Bank, Series G, 5.50% Pfd. | 9,500 | 239,495 | ||||||
First Republic Bank, Series H, 5.13% Pfd. | 9,900 | 245,124 | ||||||
FNB Corp., 7.25% Pfd. | 5,600 | 156,632 | ||||||
Hancock Holding Co., 5.95% Pfd. | 7,400 | 186,924 | ||||||
Huntington Bancshares, Inc., Series C, 5.88% Pfd. | 10,200 | 261,018 | ||||||
Huntington Bancshares, Inc., Series D, 6.25% Pfd. | 19,100 | 500,038 | ||||||
KeyCorp, Series E, 6.13% Pfd. | 23,100 | 626,703 | ||||||
MB Financial Inc., Series C, 6.00% Pfd. | 10,000 | 249,800 | ||||||
People’s United Financial, Inc., Series A, 5.63% Pfd. | 11,600 | 297,540 | ||||||
PNC Financial Services Group, Inc. (The), Series P, 6.13% Pfd. | 83,300 | 2,259,929 | ||||||
Regions Financial Corp., Series A, 6.38% Pfd. | 18,500 | 471,935 | ||||||
Regions Financial Corp., Series B, 6.38% Pfd. | 28,600 | 788,788 | ||||||
Sterling Bancorp., Series A, 6.50% Pfd. | 6,700 | 173,530 | ||||||
TCF Financial Corp., Series C, 5.70% Pfd. | 9,000 | 223,200 | ||||||
Texas Capital Bancshares, Inc., Series A, 6.50% Pfd. | 12,100 | 307,703 | ||||||
Valley National Bancorp, Series A, 6.25% Pfd. | 11,300 | 296,851 | ||||||
Valley National Bancorp, Series B, 5.50% Pfd. | 3,900 | 99,723 | ||||||
Webster Financial Corp., Series F, 5.25% Pfd. | 7,900 | 186,835 | ||||||
Wintrust Financial Corp., Series D, 6.50% Pfd. | 6,300 | 169,470 | ||||||
Zions Bancorp., Series G, 6.30% Pfd. | 7,300 | 196,041 | ||||||
13,524,500 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
17 Invesco Multi-Asset Income Fund
Shares | Value | |||||||
Reinsurance–0.44% | ||||||||
PartnerRe Ltd. (Bermuda), Series H, 7.25% Pfd. | 28,600 | $ | 788,788 | |||||
Reinsurance Group of America, Inc., 5.75% Pfd. | 23,100 | 593,901 | ||||||
Reinsurance Group of America, Inc., 6.20% Pfd. | 14,900 | 396,638 | ||||||
RenaissanceRe Holdings Ltd. (Bermuda), Series E, 5.38% Pfd. | 18,500 | 450,475 | ||||||
Validus Holdings, Ltd., Series A, 5.88% Pfd. | 9,200 | 230,000 | ||||||
Validus Holdings, Ltd., Series B, 5.80% Pfd. | 10,700 | 266,109 | ||||||
2,725,911 | ||||||||
Residential REITs–0.05% | ||||||||
American Homes 4 Rent, Series F, 5.88% Pfd. | 7,900 | 178,935 | ||||||
American Homes 4 Rent, Series G, 5.88% Pfd. | 4,500 | 101,250 | ||||||
280,185 | ||||||||
Retail REITs–0.42% | ||||||||
CBL & Associates Properties, Inc., Series D, 7.38% Pfd. | 28,600 | 506,220 | ||||||
DDR Corp., Series A, 6.38% Pfd. | 11,600 | 267,148 | ||||||
DDR Corp., Series J, 6.50% Pfd. | 13,600 | 304,640 | ||||||
Kimco Realty Corp., Series I, 6.00% Pfd. | 3,762 | 90,702 | ||||||
Kimco Realty Corp., Series L, 5.13% Pfd. | 16,000 | 335,040 | ||||||
Kimco Realty Corp., Class M, 5.25% Pfd. | 16,000 | 332,800 | ||||||
National Retail Properties, Inc., Series E, 5.70% Pfd. | 9,200 | 219,328 | ||||||
National Retail Properties, Inc., Series F, 5.20% Pfd. | 19,100 | 432,233 | ||||||
Washington Prime Group Inc., Series H, 7.50% Pfd. | 4,400 | 96,232 | ||||||
2,584,343 | ||||||||
Specialized REITs–0.96% | ||||||||
Digital Realty Trust Inc., Series C, 6.63% Pfd. | 8,400 | 220,080 | ||||||
Digital Realty Trust, Inc., Series G, 5.88% Pfd. | 15,300 | 380,970 | ||||||
Digital Realty Trust, Inc., Series H, 7.38% Pfd. | 20,300 | 528,003 | ||||||
Digital Realty Trust, Inc., Series J, 5.25% Pfd. | 18,100 | 422,273 | ||||||
EPR Properties, Series G, 5.75% Pfd. | 7,600 | 167,200 | ||||||
Public Storage, Series A, 5.88% Pfd. | 8,400 | 214,536 | ||||||
Public Storage, Series B, 5.40% Pfd. | 27,100 | 672,080 | ||||||
Public Storage, Series C, 5.13% Pfd. | 33,300 | 823,176 | ||||||
Public Storage, Series D, 4.95% Pfd. | 35,800 | 826,622 | ||||||
Public Storage, Series E, 4.90% Pfd. | 38,100 | 869,061 | ||||||
Public Storage, Series F, 5.15% Pfd. | 8,100 | 191,970 | ||||||
Public Storage, Series G, 5.05% Pfd. | 14,900 | 346,425 | ||||||
Public Storage, Series Y, 6.38% Pfd. | 8,100 | 210,519 | ||||||
5,872,915 |
Shares | Value | |||||||
Thrifts & Mortgage Finance–0.11% | ||||||||
New York Community Bancorp Inc., Series A, 6.38% Pfd. | 23,800 | $ | 644,266 | |||||
Trading Companies & Distributors–0.03% | ||||||||
GATX Corp., 5.63% Pfd. | 6,800 | 171,564 | ||||||
Wireless Telecommunication Services–0.32% | ||||||||
Telephone & Data Systems Inc., 5.88% Pfd. | 14,900 | 351,044 | ||||||
Telephone & Data Systems Inc., 7.00% Pfd. | 23,100 | 577,038 | ||||||
United States Cellular Corp., 6.95% Pfd. | 7,600 | 189,088 | ||||||
United States Cellular Corp., 7.25% Pfd. | 16,700 | 419,170 | ||||||
United States Cellular Corp., 7.25% Pfd. | 17,400 | 436,740 | ||||||
1,973,080 | ||||||||
Total Preferred Stocks | 132,308,123 | |||||||
Common Stocks & Other Equity Interests–17.27% | ||||||||
Diversified REITs–1.07% | ||||||||
Gladstone Commercial Corp. | 99,896 | 1,732,199 | ||||||
Global Net Lease, Inc. | 165,824 | 3,085,985 | ||||||
Lexington Realty Trust | 213,390 | 1,715,655 | ||||||
6,533,839 | ||||||||
Health Care REITs–1.66% | ||||||||
MedEquities Realty Trust, Inc. | 171,069 | 1,743,193 | ||||||
Medical Properties Trust Inc. | 126,695 | 1,619,162 | ||||||
New Senior Investment Group Inc. | 303,357 | 2,614,937 | ||||||
Sabra Health Care REIT, Inc. | 120,301 | 2,202,711 | ||||||
Senior Housing Properties Trust | 129,603 | 2,017,919 | ||||||
10,197,922 | ||||||||
Hotel & Resort REITs–2.06% | ||||||||
Apple Hospitality REIT, Inc. | 79,166 | 1,424,196 | ||||||
Ashford Hospitality Trust, Inc. | 301,078 | 2,071,417 | ||||||
Braemar Hotels & Resorts Inc. | 164,789 | 1,713,806 | ||||||
Chatham Lodging Trust | 75,971 | 1,447,247 | ||||||
Chesapeake Lodging Trust | 45,563 | 1,345,931 | ||||||
Hersha Hospitality Trust | 75,569 | 1,419,186 | ||||||
Hospitality Properties Trust | 61,203 | 1,522,731 | ||||||
LaSalle Hotel Properties | 56,967 | 1,684,514 | ||||||
12,629,028 | ||||||||
Mortgage REITs–8.66% | ||||||||
AG Mortgage Investment Trust, Inc. | 93,018 | 1,644,558 | ||||||
AGNC Investment Corp. | 225,119 | 4,259,252 | ||||||
Annaly Capital Management, Inc. | 194,223 | 2,014,093 | ||||||
Anworth Mortgage Asset Corp. | 298,336 | 1,411,129 | ||||||
Apollo Commercial Real Estate Finance, Inc. | 98,846 | 1,781,205 | ||||||
Blackstone Mortgage Trust, Inc.—Class A | 76,878 | 2,371,686 | ||||||
Capstead Mortgage Corp. | 122,883 | 1,081,370 | ||||||
Cherry Hill Mortgage Investment Corp. | 63,055 | 1,111,029 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
18 Invesco Multi-Asset Income Fund
Shares | Value | |||||||
Mortgage REITs–(continued) | ||||||||
Chimera Investment Corp. | 306,195 | $ | 5,355,351 | |||||
CYS Investments, Inc. | 343,842 | 2,465,347 | ||||||
Ellington Residential Mortgage REIT | 41,903 | 476,437 | ||||||
Granite Point Mortgage Trust Inc. | 56,658 | 942,787 | ||||||
Ladder Capital Corp. | 88,510 | 1,230,289 | ||||||
MFA Financial, Inc. | 611,201 | 4,596,232 | ||||||
MTGE Investment Corp. | 124,929 | 2,267,461 | ||||||
New Residential Investment Corp. | 301,082 | 5,262,913 | ||||||
Orchid Island Capital Inc. | 250,118 | 1,750,826 | ||||||
PennyMac Mortgage Investment Trust | 68,532 | 1,205,478 | ||||||
Redwood Trust, Inc. | 70,135 | 1,075,871 | ||||||
Starwood Property Trust, Inc. | 215,028 | 4,506,987 | ||||||
Two Harbors Investment Corp. | 298,930 | 4,561,672 | ||||||
Western Asset Mortgage Capital Corp. | 171,331 | 1,704,743 | ||||||
53,076,716 | ||||||||
Office REITs–0.64% | ||||||||
Franklin Street Properties Corp. | 221,135 | 1,720,430 | ||||||
Government Properties Income Trust | 174,005 | 2,173,323 | ||||||
3,893,753 | ||||||||
Residential REITs–0.29% | ||||||||
Independence Realty Trust, Inc. | 188,884 | 1,775,510 | ||||||
Retail REITs–1.91% | ||||||||
DDR Corp. | 237,885 | 1,724,666 | ||||||
Kite Realty Group Trust | 105,510 | 1,553,107 | ||||||
Pennsylvania Real Estate Investment Trust | 146,765 | 1,420,685 | ||||||
Ramco-Gershenson Properties Trust | 120,763 | 1,443,118 | ||||||
Tanger Factory Outlet Centers, Inc. | 52,369 | 1,149,500 | ||||||
Washington Prime Group Inc. | 443,875 | 2,871,871 | ||||||
Whitestone REIT | 142,566 | 1,546,841 | ||||||
11,709,788 | ||||||||
Specialized REITs–0.98% | ||||||||
CoreCivic, Inc. | 75,781 | 1,527,745 | ||||||
EPR Properties | 24,770 | 1,362,846 | ||||||
Farmland Partners Inc. | 171,742 | 1,308,674 | ||||||
Geo Group, Inc. (The) | 78,913 | 1,775,531 | ||||||
5,974,796 | ||||||||
Total Common Stocks & Other Equity Interests |
| 105,791,352 | ||||||
Principal Amount | ||||||||
U.S. Treasury Securities–9.12% |
| |||||||
U.S. Treasury Bills–0.08% | ||||||||
1.59%, 07/26/2018(f)(g) | $ | 250,000 | 248,941 | |||||
1.75%, 07/26/2018(f)(g) | 75,000 | 74,682 | ||||||
1.79%, 07/26/2018(f)(g) | 130,000 | 129,450 | ||||||
453,073 |
Principal Amount | Value | |||||||
U.S. Treasury STRIPS–9.04% | ||||||||
2.71%, 11/15/2045(f)(h) | $ | 25,685,000 | $ | 10,929,705 | ||||
2.88%, 11/15/2045(f)(h) | 640,000 | 2,723,384 | ||||||
2.90%, 11/15/2045(f)(h) | 8,800,000 | 3,744,653 | ||||||
2.91%, 11/15/2045(f)(h) | 3,000,000 | 1,276,586 | ||||||
2.94%, 11/15/2045(f)(h) | 4,800,000 | 2,042,538 | ||||||
2.95%, 11/15/2045(f)(h) | 4,000,000 | 1,702,115 | ||||||
2.96%, 11/15/2045(f)(h) | 19,000,000 | 8,085,045 | ||||||
2.97%, 11/15/2045(f)(h) | 5,200,000 | 2,212,749 | ||||||
2.98%, 11/15/2045(f)(h) | 4,300,000 | 1,829,773 | ||||||
2.99%, 11/15/2045(f)(h) | 2,300,000 | 978,716 | ||||||
3.01%, 11/15/2045(f)(h) | 7,200,000 | 3,063,807 | ||||||
3.02%, 11/15/2045(f)(h) | 4,800,000 | 2,042,538 | ||||||
3.03%, 11/15/2045(f)(h) | 1,500,000 | 638,293 | ||||||
3.08%, 11/15/2045(f)(h) | 5,900,000 | 2,510,619 | ||||||
3.13%, 11/15/2045(f)(h) | 2,100,000 | 893,610 | ||||||
3.14%, 11/15/2045(f)(h) | 4,200,000 | 1,787,220 | ||||||
3.19%, 11/15/2045(f)(h) | 10,000,000 | 4,255,287 | ||||||
3.27%, 11/15/2045(f)(h) | 11,015,000 | 4,687,199 | ||||||
55,403,837 | ||||||||
Total U.S. Treasury Securities |
| 55,856,910 | ||||||
Exchange Traded Notes–9.07% |
| |||||||
ETRACS Alerian MLP Infrastructure Index ETN, 7.36% (linked to the Alerian MLP Infrastructure Index — 0.21%), 04/02/2040(d) | 1,142,000 | 25,500,860 | ||||||
JPMorgan Alerian MLP Index ETN, 6.48%(linked to the Alerian MLP Index — 0.21%), 05/24/2024(d) | 1,158,000 | 30,061,680 | ||||||
Total Exchange Traded Notes |
| 55,562,540 | ||||||
Non-U.S. Dollar Denominated Bonds & Notes–0.25%(i) |
| |||||||
Brewers–0.04% | ||||||||
Sunshine Mid B.V. (Netherlands), Sr. Unsec. Gtd. Bonds, 6.50%, 05/15/2026(b) | EUR | 200,000 | 243,955 | |||||
Cable & Satellite–0.03% | ||||||||
Tele Columbus AG (Germany), Sr. Sec. Notes, 3.88%, 05/02/2025(b) | EUR | 150,000 | 180,776 | |||||
Food Retail–0.05% | ||||||||
Iceland Bondco PLC (United Kingdom), REGS, Sr. Sec. Gtd. First Lien Euro Notes, 4.63%, 03/15/2025(b) | GBP | 250,000 | 315,887 | |||||
Health Care Services–0.04% | ||||||||
Synlab Unsecured Bondco PLC (United Kingdom), REGS, Sr. Unsec. Gtd. Euro Bonds, 8.25%, 07/01/2023(b) | EUR | 200,000 | 258,886 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
19 Invesco Multi-Asset Income Fund
Principal Amount | Value | |||||||
Packaged Foods & Meats–0.03% | ||||||||
Darling Global Finance B.V., | EUR | 150,000 | $ | 183,892 | ||||
Restaurants–0.04% | ||||||||
PizzaExpress Financing 2 PLC (United Kingdom), REGS, Sr. Sec. Gtd. First Lien Euro Bonds, 6.63%, 08/01/2021(b) | GBP | 200,000 | 259,413 | |||||
Textiles–0.02% | ||||||||
Eagle Intermediate Global Holding B.V./Ruyi US Finance LLC (China), Sr. Sec. Gtd. First Lien Bonds, 5.38%, 05/01/2023(b) | EUR | 100,000 | 123,789 | |||||
Total Non-U.S. Dollar Denominated Bonds & Notes |
| 1,566,598 | ||||||
Variable Rate Senior Loan Interests–0.23%(j) |
| |||||||
Food Retail–0.23% | ||||||||
Albertson’s LLC, Term Loan B-4, 4.63% (1 mo. USD LIBOR + 2.75%), 08/25/2021 (Cost $1,357,626) | 1,395,955 | 1,384,878 |
Shares | Value | |||||||
Money Market Funds–1.81% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(k) | 3,875,138 | $ | 3,875,138 | |||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(k) | 2,767,434 | 2,767,711 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(k) | 4,428,729 | 4,428,729 | ||||||
Total Money Market Funds |
| 11,071,578 | ||||||
TOTAL INVESTMENTS IN SECURITIES–98.54% |
| 603,752,587 | ||||||
OTHER ASSETS LESS LIABILITIES–1.46% |
| 8,966,351 | ||||||
NET ASSETS–100.00% |
| $ | 612,718,938 |
Investment Abbreviations:
Conv. | – Convertible | |
Deb. | – Debentures | |
ETN | – Exchange Traded Notes | |
EUR | – Euro | |
GBP | – British Pound | |
Gtd. | – Guaranteed | |
Jr. | – Junior | |
LIBOR | – London Interbank Offered Rate | |
MLP | – Master Limited Partnership | |
Pfd. | – Preferred |
PIK | – Pay-in-Kind | |
REGS | – Regulation S | |
REIT | – Real Estate Investment Trust | |
Sec. | – Secured | |
Sr. | – Senior | |
STRIPS | – Separately Traded Registered Interest and Principal Security | |
Sub. | – Subordinated | |
Unsec. | – Unsecured | |
USD | – U.S. Dollar |
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2018 was $132,992,965, which represented 21.71% of the Fund’s Net Assets. |
(c) | Perpetual bond with no specified maturity date. |
(d) | Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on April 30, 2018. |
(e) | All or a portion of this security is Pay-in-Kind. Pay-in-Kind securities pay interest income in the form of securities. |
(f) | Security traded on a discount basis. The interest rate shown represents the discount rate at the time of purchase by the Fund. |
(g) | All or a portion of the value was designated as collateral to cover margin requirements for open swap agreements. See Note 1P. |
(h) | All or a portion of the value was pledged as collateral to cover margin requirements for open futures contracts. See Note 1M. |
(i) | Foreign denominated security. Principal amount is denominated in the currency indicated. |
(j) | Variable rate senior loan interests are, at present, not readily marketable, not registered under the Securities Act of 1933 and may be subject to contractual and legal restrictions on sale. Variable rate senior loan interests in the Fund’s portfolio generally have variable rates which adjust to a base, such as the London Interbank Offered Rate (“LIBOR”), on set dates, typically every 30 days but not greater than one year; and/or have interest rates that float at a margin above a widely recognized base lending rate such as the Prime Rate of a designated U.S. bank. |
(k) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
20 Invesco Multi-Asset Income Fund
Portfolio Composition
By security type, based on Net Assets
as of April 30, 2018
U.S. Dollar Denominated Bonds & Notes | 39.2 | % | ||
Preferred Stocks | 21.6 | |||
Common Stocks & Other Equity Interests | 17.3 | |||
U.S. Treasury Securities | 9.1 | |||
Exchange Traded Notes | 9.1 | |||
Non-U.S. Dollar Denominated Bonds & Notes | 0.2 | |||
Variable Rate Senior Loan Interests | 0.2 | |||
Money Market Funds Plus Other Assets Less Liabilities | 3.3 |
Open Futures Contracts | ||||||||||||||||||||
Long Futures Contracts | Number of Contracts | Expiration Month | Notional Value | Value | Unrealized Appreciation | |||||||||||||||
E-Mini Russell 2000 | 232 | June-2018 | $ | 17,908,080 | $ | (160,674 | ) | $ | (160,674 | ) | ||||||||||
E-Mini S&P 500 Index | 134 | June-2018 | 17,734,900 | (157,210 | ) | (157,210 | ) | |||||||||||||
Hang Seng Index | 139 | May-2018 | 27,154,110 | 381,155 | 381,155 | |||||||||||||||
Topix Stock Price Index | 220 | June-2018 | 35,811,379 | 1,405,764 | 1,405,764 | |||||||||||||||
Subtotal — Equity Risk | 1,469,035 | 1,469,035 | ||||||||||||||||||
Euro Bonds — Interest Rate Risk | 142 | June-2018 | 27,222,862 | (116,152 | ) | (116,152 | ) | |||||||||||||
Subtotal — Long Futures Contracts | 1,352,883 | 1,352,883 | ||||||||||||||||||
Short Futures Contracts | ||||||||||||||||||||
U.S. Treasury Long Bonds — Interest Rate Risk | 229 | June-2018 | (32,940,219 | ) | (235,940 | ) | (235,940 | ) | ||||||||||||
Total Futures Contracts |
| $ | 1,116,943 | $ | 1,116,943 |
Open Forward Foreign Currency Contracts | ||||||||||||||||||||||
Settlement Date
| Contract to | Unrealized Appreciation (Depreciation) | ||||||||||||||||||||
Counterparty | Deliver | Receive | ||||||||||||||||||||
05/31/2018 | Barclays Bank PLC | GBP | 609,156 | USD | 851,883 | $ | 12,024 | |||||||||||||||
05/31/2018 | Goldman Sachs International | EUR | 166,174 | USD | 206,176 | 5,022 | ||||||||||||||||
Subtotal — Appreciation | 17,046 | |||||||||||||||||||||
05/31/2018 | Barclays Bank PLC | USD | 355,272 | GBP | 255,174 | (3,457 | ) | |||||||||||||||
05/31/2018 | Citigroup Global Markets Inc. | EUR | 575,000 | USD | 695,918 | (122 | ) | |||||||||||||||
Subtotal — Depreciation | (3,579 | ) | ||||||||||||||||||||
Total Forward Foreign Currency Contracts — Currency Risk |
| $ | 13,467 |
Currency Abbreviations:
EUR | – Euro | |
GBP | – British Pound Sterling | |
USD | – U.S. Dollar |
Open Centrally Cleared Credit Default Swap Agreements | ||||||||||||||||||||||||||||||||||||||||
Reference Entity | Buy/Sell Protection | (Pay)/ Receive Fixed Rate | Payment Frequency | Maturity Date | Implied Credit Spread(a) | Notional Value | Upfront Payments Paid | Value | Unrealized Appreciation(b) | |||||||||||||||||||||||||||||||
Markit CDX North America High Yield Index, Series 29, Version 1 | Sell | 5.00 | % | Quarterly | 12/20/2022 | 3.173 | % | USD | 2,485,000 | $ | 169,488 | $ | 180,838 | $ | 11,350 | |||||||||||||||||||||||||
Markit CDX North America High Yield Index, Series 30, Version 1 | Sell | 5.00 | Quarterly | 06/20/2023 | 3.390 | USD | 2,900,000 | 177,792 | 200,579 | 22,787 | ||||||||||||||||||||||||||||||
Total Centrally Cleared Credit Default Swap Agreements — Credit Risk |
| $ | 347,280 | $ | 381,417 | $ | 34,137 |
(a) | Implied credit spreads represent the current level, as of April 30, 2018, at which protection could be bought or sold given the terms of the existing credit default swap agreement and serve as an indicator of the current status of the payment/performance risk of the credit default swap agreement. An implied credit spread that has widened or increased since entry into the initial agreement may indicate a deteriorating credit profile and increased risk of default for the reference entity. A declining or narrowing spread may indicate an improving credit profile or decreased risk of default for the reference entity. Alternatively, credit spreads may increase or decrease reflecting the general tolerance for risk in the credit markets generally. |
(b) | The daily variation margin payable at period-end is recorded in the Statement of Assets and Liabilities. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
21 Invesco Multi-Asset Income Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $613,595,139) | $ | 592,681,009 | ||
Investments in affiliated money market funds, at value | 11,071,578 | |||
Other investments: | ||||
Variation margin receivable — futures contracts | 76,568 | |||
Unrealized appreciation on forward foreign currency contracts outstanding | 17,046 | |||
Cash | 123,593 | |||
Foreign currencies, at value (Cost $53,403) | 52,202 | |||
Receivable for: | ||||
Investments sold | 1,725,858 | |||
Fund shares sold | 6,052,962 | |||
Dividends and interest | 3,989,892 | |||
Fund expenses absorbed | 135,075 | |||
Investment for trustee deferred compensation and retirement plans | 30,238 | |||
Other assets | 79,491 | |||
Total assets | 616,035,512 | |||
Liabilities: |
| |||
Other investments: | ||||
Variation margin payable — centrally cleared swap agreements | 1,181 | |||
Unrealized depreciation on forward foreign currency contracts outstanding | 3,579 | |||
Payable for: | ||||
Investments purchased | 1,416,624 | |||
Fund shares reacquired | 1,440,124 | |||
Accrued fees to affiliates | 230,705 | |||
Accrued trustees’ and officers’ fees and benefits | 3,865 | |||
Accrued other operating expenses | 186,496 | |||
Trustee deferred compensation and retirement plans | 34,000 | |||
Total liabilities | 3,316,574 | |||
Net assets applicable to shares outstanding | $ | 612,718,938 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 640,839,885 | ||
Undistributed net investment income | (220,820 | ) | ||
Undistributed net realized gain (loss) | (8,156,955 | ) | ||
Net unrealized appreciation (depreciation) | (19,743,172 | ) | ||
$ | 612,718,938 |
Net Assets: |
| |||
Class A | $ | 138,973,193 | ||
Class C | $ | 88,089,723 | ||
Class R | $ | 2,103,147 | ||
Class Y | $ | 317,874,688 | ||
Class R5 | $ | 29,877 | ||
Class R6 | $ | 65,648,310 | ||
Shares outstanding, no par value, |
| |||
Class A | 13,339,114 | |||
Class C | 8,462,625 | |||
Class R | 201,902 | |||
Class Y | 30,506,682 | |||
Class R5 | 2,867 | |||
Class R6 | 6,300,088 | |||
Class A: | ||||
Net asset value per share | $ | 10.42 | ||
Maximum offering price per share | ||||
(Net asset value of $10.42 ¸ 94.50%) | $ | 11.03 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 10.41 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 10.42 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 10.42 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 10.42 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 10.42 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
22 Invesco Multi-Asset Income Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Interest | $ | 7,807,044 | ||
Dividends | 11,739,574 | |||
Dividends from affiliated money market funds | 130,769 | |||
Total investment income | 19,677,387 | |||
Expenses: | ||||
Advisory fees | 1,600,277 | |||
Administrative services fees | 87,853 | |||
Custodian fees | 28,073 | |||
Distribution fees: | ||||
Class A | 217,192 | |||
Class C | 417,357 | |||
Class R | 4,776 | |||
Transfer agent fees — A, C, R and Y | 372,686 | |||
Transfer agent fees — R5 | 4 | |||
Transfer agent fees — R6 | 630 | |||
Trustees’ and officers’ fees and benefits | 17,194 | |||
Registration and filing fees | 81,213 | |||
Licensing fees | 114,072 | |||
Reports to shareholders | 38,176 | |||
Professional services fees | 36,905 | |||
Other | 24,501 | |||
Total expenses | 3,040,909 | |||
Less: Fees waived, expenses reimbursed and expense offset arrangement(s) | (447,411 | ) | ||
Net expenses | 2,593,498 | |||
Net investment income | 17,083,889 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | (10,167,522 | ) | ||
Foreign currencies | 129,359 | |||
Forward foreign currency contracts | (82,166 | ) | ||
Futures contracts | 6,647,758 | |||
Option contracts written | (61,516 | ) | ||
Swap agreements | 189,346 | |||
(3,344,741 | ) | |||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | (24,299,753 | ) | ||
Foreign currencies | 5,481 | |||
Forward foreign currency contracts | 21,397 | |||
Futures contracts | (3,685,188 | ) | ||
Swap agreements | (85,043 | ) | ||
(28,043,106 | ) | |||
Net realized and unrealized gain (loss) | (31,387,847 | ) | ||
Net increase (decrease) in net assets resulting from operations | $ | (14,303,958 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
23 Invesco Multi-Asset Income Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income | $ | 17,083,889 | $ | 17,255,203 | ||||
Net realized gain (loss) | (3,344,741 | ) | 10,588,385 | |||||
Change in net unrealized appreciation (depreciation) | (28,043,106 | ) | 3,221,889 | |||||
Net increase (decrease) in net assets resulting from operations | (14,303,958 | ) | 31,065,477 | |||||
Distributions to shareholders from net investment income: | ||||||||
Class A | (4,548,682 | ) | (5,659,946 | ) | ||||
Class C | (1,833,127 | ) | (1,660,348 | ) | ||||
Class R | (46,806 | ) | (45,346 | ) | ||||
Class Y | (9,129,311 | ) | (7,006,185 | ) | ||||
Class R5 | (805 | ) | (1,289 | ) | ||||
Class R6 | (1,678,209 | ) | (2,679,432 | ) | ||||
Total distributions from net investment income | (17,236,940 | ) | (17,052,546 | ) | ||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | (1,740,073 | ) | — | |||||
Class C | (704,964 | ) | — | |||||
Class R | (15,845 | ) | — | |||||
Class Y | (3,025,588 | ) | — | |||||
Class R5 | (260 | ) | — | |||||
Class R6 | (542,433 | ) | — | |||||
Total distributions from net realized gains | (6,029,163 | ) | — | |||||
Share transactions–net: | ||||||||
Class A | (42,336,644 | ) | 94,789,727 | |||||
Class C | 18,564,859 | 48,232,871 | ||||||
Class R | 603,249 | 1,023,387 | ||||||
Class Y | 8,326,535 | 293,115,564 | ||||||
Class R5 | 1,406 | 9,180 | ||||||
Class R6 | 8,009,084 | 9,119,307 | ||||||
Net increase (decrease) in net assets resulting from share transactions | (6,831,511 | ) | 446,290,036 | |||||
Net increase (decrease) in net assets | (44,401,572 | ) | 460,302,967 | |||||
Net assets: | ||||||||
Beginning of period | 657,120,510 | 196,817,543 | ||||||
End of period (includes undistributed net investment income of $(220,820) and $(67,769), respectively) | $ | 612,718,938 | $ | 657,120,510 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Multi-Asset Income Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to provide current income.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value.
24 Invesco Multi-Asset Income Fund
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Paydown gains and losses on mortgage and asset-backed securities are recorded as adjustments to interest income. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
25 Invesco Multi-Asset Income Fund
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
The Fund recharacterizes distributions received from REIT investments based on information provided by the REIT into the following categories: ordinary income, long-term and short-term capital gains, and return of capital. If information is not available on a timely basis from the REIT, the recharacterization will be based on available information which may include the previous year’s allocation. If new or additional information becomes available from the REIT at a later date, a recharacterization will be made in the following year. The Fund records as dividend income the amount recharacterized as ordinary income and as realized gain the amount recharacterized as capital gain in the Statement of Operations, and the amount recharacterized as return of capital as a reduction of the cost of the related investment. These recharacterizations are reflected in the accompanying financial statements.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income, if any, are declared and paid monthly. Distributions from net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Master Limited Partnerships — The Fund invests in Master Limited Partnerships (“MLPs”). MLPs are publicly traded partnerships and limited liability companies taxed as partnerships under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”). The Fund invests in MLPs engaged in, among other things, the exploring, producing, transporting, processing, storing, refining, mining or marketing of minerals and natural resources. The Fund is a partner in each MLP; accordingly, the Fund is required to take into account the Fund’s allocable share of income, gains, losses, deductions, expenses, and tax credits recognized by each MLP. |
The Fund is non-diversified and will concentrate its investments in the energy sector. Energy infrastructure MLPs are subject to a variety of industry specific risk factors that may adversely affect their business or operations, including a decrease in production or reduced volumes of natural gas or other energy commodities available for transporting, processing, storing or distributing; changes in energy commodity prices; a sustained reduced demand for crude oil, natural gas and refined petroleum products; depletion of natural gas reserves or other commodities if not replaced; natural disasters, extreme weather and environmental hazards; rising interest rates, how facilities are constructed, maintained and operated, environmental and safety controls, and the prices they may charge for products and services. In addition, taxes, government regulation, international politics, price, and supply fluctuations, volatile interest rates and energy conservation may cause difficulties for energy infrastructure MLPs.
MLPs may be less liquid and subject to more abrupt or erratic price movements than conventional publicly traded securities.
F. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
G. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
H. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
26 Invesco Multi-Asset Income Fund
I. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
J. | Exchange-traded Notes — The Fund may invest in exchange-traded notes (“ETNs”) which are senior, unsecured, unsubordinated debt securities whose returns are linked to the performance of a particular market benchmark or strategy, minus applicable fees. ETNs can be traded on an exchange and/or they can be held to maturity. At maturity, the issuer pays the investor a cash amount equal to the principal amount, subject to the day’s market benchmark or strategy factor. ETNs do not make periodic coupon payments or provide principal protection. The value of an ETN may be influenced by time to maturity, level of supply and demand for the ETN, volatility and lack of liquidity in underlying assets and changes in the applicable interest rates. ETNs are subject to credit risk, including the credit risk of the issuer. |
K. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
L. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
M. | Futures Contracts — The Fund may enter into futures contracts to manage exposure to interest rate, equity and market price movements and/or currency risks. A futures contract is an agreement between Counterparties to purchase or sell a specified underlying security, currency or commodity (or delivery of a cash settlement price, in the case of an index future) for a fixed price at a future date. The Fund currently invests only in exchange-traded futures and they are standardized as to maturity date and underlying financial instrument. Initial margin deposits required upon entering into futures contracts are satisfied by the segregation of specific securities or cash as collateral at the futures commission merchant (broker). During the period the futures contracts are open, changes in the value of the contracts are recognized as unrealized gains or losses by recalculating the value of the contracts on a daily basis. Subsequent or variation margin payments are received or made depending upon whether unrealized gains or losses are incurred. These amounts are reflected as receivables or payables on the Statement of Assets and Liabilities. When the contracts are closed or expire, the Fund recognizes a realized gain or loss equal to the difference between the proceeds from, or cost of, the closing transaction and the Fund’s basis in the contract. The net realized gain (loss) and the change in unrealized gain (loss) on futures contracts held during the period is included on the Statement of Operations. The primary risks associated with futures contracts are market risk and the absence of a liquid secondary market. If the Fund were unable to liquidate a futures contract and/or enter into an offsetting closing transaction, the Fund would continue to be subject to market risk with respect to the value of the contracts and continue to be required to maintain the margin deposits on the futures contracts. Futures contracts have minimal Counterparty risk since the exchange’s clearinghouse, as Counterparty to all exchange-traded futures, guarantees the futures against default. Risks may exceed amounts recognized in the Statement of Assets and Liabilities. |
N. | Call Options Purchased and Written — The Fund may write call options and/or buy call options. A covered call option gives the purchaser of such option the right to buy, and the writer the obligation to sell, the underlying security or foreign currency at the stated exercise price during the option period. An uncovered call option exists without the ownership of the underlying security. Options written by the Fund normally will have expiration dates between three and nine months from the date written. The exercise price of a call option may be below, equal to, or above the current market value of the underlying security at the time the option is written. |
Additionally, the Fund may enter into an option on a swap agreement, also called a “swaption”. A swaption is an option that gives the buyer the right, but not the obligation, to enter into a swap on a future date in exchange for paying a market-based premium. A receiver swaption gives the
27 Invesco Multi-Asset Income Fund
owner the right to receive the total return of a specified asset, reference rate or index. Swaptions also include options that allow an existing swap to be terminated or extended by one of the Counterparties.
When the Fund writes a covered call option, an amount equal to the premium received by the Fund is recorded as an asset and an equivalent liability in the Statement of Assets and Liabilities. The amount of the liability is subsequently “marked-to-market” to reflect the current market value of the option written. If a written covered call option expires on the stipulated expiration date, or if the Fund enters into a closing purchase transaction, the Fund realizes a gain (or a loss if the closing purchase transaction exceeds the premium received when the option was written) without regard to any unrealized gain or loss on the underlying security, and the liability related to such option is extinguished. If a written covered call option is exercised, the Fund realizes a gain or a loss from the sale of the underlying security and the proceeds of the sale are increased by the premium originally received. Realized and unrealized gains and losses on call options written are included in the Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Option contracts written. A risk in writing a covered call option is that the Fund gives up the opportunity for profit if the market price of the security increases and the option is exercised. The risk in writing an uncovered call option is that the Fund may incur significant losses if the value of the written security exceeds the exercise price of the option.
When the Fund buys a call option, an amount equal to the premium paid by the Fund is recorded as an investment on the Statement of Assets and Liabilities. The amount of the investment is subsequently “marked-to-market” to reflect the current value of the option purchased. Realized and unrealized gains and losses on call options purchased are included in the Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Investment securities. A risk in buying an option is that the Fund pays a premium whether or not the option is exercised. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased.
O. | Put Options Purchased — The Fund may purchase put options including options on securities indexes, or foreign currency and/or futures contracts. By purchasing a put option, the Fund obtains the right (but not the obligation) to sell the option’s underlying instrument at a fixed strike price. In return for this right, the Fund pays an option premium. The option’s underlying instrument may be a security, securities index, or a futures contract. Put options may be used by the Fund to hedge securities it owns by locking in a minimum price at which the Fund can sell. If security prices fall, the put option could be exercised to offset all or a portion of the Fund’s resulting losses. At the same time, because the maximum the Fund has at risk is the cost of the option, purchasing put options does not eliminate the potential for the Fund to profit from an increase in the value of the securities hedged. Realized and unrealized gains and losses on put options purchased are included in the Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Investment securities. A risk in buying an option is that the Fund pays a premium whether or not the option is exercised. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased. |
P. | Swap Agreements — The Fund may enter into various swap transactions, including interest rate, total return, index, currency and credit default swap contracts (“CDS”) for investment purposes or to manage interest rate, currency or credit risk. Such transactions are agreements between Counterparties. A swap agreement may be negotiated bilaterally and traded over-the-counter (“OTC”) between two parties (“uncleared/OTC”) or, in some instances, must be transacted through a future commission merchant (“FCM”) and cleared through a clearinghouse that serves as a central Counterparty (“centrally cleared swap”). These agreements may contain among other conditions, events of default and termination events, and various covenants and representations such as provisions that require the Fund to maintain a pre-determined level of net assets, and/or provide limits regarding the decline of the Fund’s NAV over specific periods of time. If the Fund were to trigger such provisions and have open derivative positions at that time, the Counterparty may be able to terminate such agreement and request immediate payment in an amount equal to the net liability positions, if any. |
Interest rate, total return, index, and currency swap agreements are two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a notional amount, i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate or return of an underlying asset, in a particular foreign currency, or in a “basket” of securities representing a particular index.
In a centrally cleared swap, the Fund’s ultimate Counterparty is a central clearinghouse. The Fund initially will enter into centrally cleared swaps through an executing broker. When a fund enters into a centrally cleared swap, it must deliver to the central Counterparty (via the FCM) an amount referred to as “initial margin.” Initial margin requirements are determined by the central Counterparty, but an FCM may require additional initial margin above the amount required by the central Counterparty. Initial margin deposits required upon entering into centrally cleared swaps are satisfied by cash or securities as collateral at the FCM. Securities deposited as initial margin are designated on the Schedule of Investments and cash deposited is recorded on the Statement of Assets and Liabilities. During the term of a cleared swap agreement, a “variation margin” amount may be required to be paid by the Fund or may be received by the Fund, based on the daily change in price of the underlying reference instrument subject to the swap agreement and is recorded as a receivable or payable for variation margin in the Statement of Assets and Liabilities until the centrally cleared swap is terminated at which time a realized gain or loss is recorded.
A CDS is an agreement between Counterparties to exchange the credit risk of an issuer. A buyer of a CDS is said to buy protection by paying a fixed payment over the life of the agreement and in some situations an upfront payment to the seller of the CDS. If a defined credit event occurs (such as payment default or bankruptcy), the Fund as a protection buyer would cease paying its fixed payment, the Fund would deliver eligible bonds issued by the reference entity to the seller, and the seller would pay the full notional value, or the “par value”, of the referenced obligation to the Fund. A seller of a CDS is said to sell protection and thus would receive a fixed payment over the life of the agreement and an upfront payment, if applicable. If a credit event occurs, the Fund as a protection seller would cease to receive the fixed payment stream, the Fund would pay the buyer “par value” or the full notional value of the referenced obligation, and the Fund would receive the eligible bonds issued by the reference entity. In turn, these bonds may be sold in order to realize a recovery value. Alternatively, the seller of the CDS and its Counterparty may agree to net the notional amount and the market value of the bonds and make a cash payment equal to the difference to the buyer of protection. If no credit event occurs, the Fund receives the fixed payment over the life of the agreement. As the seller, the Fund would effectively add leverage to its portfolio because, in addition to its total net assets, the Fund would be subject to investment exposure on the notional amount of the CDS. In connection with these agreements, cash and securities may be identified as collateral in accordance with the terms of the respective swap agreements to provide assets of value and recourse in the event of default under the swap agreement or bankruptcy/insolvency
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of a party to the swap agreement. If a Counterparty becomes bankrupt or otherwise fails to perform its obligations due to financial difficulties, the Fund may experience significant delays in obtaining any recovery in a bankruptcy or other reorganization proceeding. The Fund may obtain only limited recovery or may obtain no recovery in such circumstances. The Fund’s maximum risk of loss from Counterparty risk, either as the protection seller or as the protection buyer, is the value of the contract. The risk may be mitigated by having a master netting arrangement between the Fund and the Counterparty and by the designation of collateral by the Counterparty to cover the Fund’s exposure to the Counterparty.
Implied credit spreads represent the current level at which protection could be bought or sold given the terms of the existing CDS contract and serve as an indicator of the current status of the payment/performance risk of the CDS. An implied spread that has widened or increased since entry into the initial contract may indicate a deteriorating credit profile and increased risk of default for the reference entity. A declining or narrowing spread may indicate an improving credit profile or decreased risk of default for the reference entity. Alternatively, credit spreads may increase or decrease reflecting the general tolerance for risk in the credit markets.
An interest rate swap is an agreement between Counterparties pursuant to which the parties exchange a floating rate payment for a fixed rate payment based on a specified notional amount.
Changes in the value of centrally cleared and OTC swap agreements are recognized as unrealized gains (losses) in the Statement of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Statement of Assets and Liabilities and may be referred to as upfront payments. The Fund accrues for the fixed payment stream and amortizes upfront payments, if any, on swap agreements on a daily basis with the net amount, recorded as a component of realized gain (loss) on the Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Statement of Operations. The Fund segregates cash or liquid securities having a value at least equal to the amount of the potential obligation of a Fund under any swap transaction. Cash held as collateral is recorded as deposits with brokers on the Statement of Assets and Liabilities. Entering into these agreements involves, to varying degrees, lack of liquidity and elements of credit, market, and Counterparty risk in excess of amounts recognized on the Statement of Assets and Liabilities. Such risks involve the possibility that a swap is difficult to sell or liquidate; the Counterparty does not honor its obligations under the agreement and unfavorable interest rates and market fluctuations. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund’s exposure is unlimited.
Notional amounts of each individual credit default swap agreement outstanding as of April 30, 2018 for which the Fund is the seller of protection are disclosed in the open swap agreements table. These potential amounts would be partially offset by any recovery values of the respective referenced obligations, upfront payments received upon entering into the agreement, or net amounts received from the settlement of buy protection credit default swap agreements entered into by the Fund for the same referenced entity or entities.
Q. | Other Risks — The Fund may invest in lower-quality debt securities, i.e., “junk bonds”. Investments in lower-rated securities or unrated securities of comparable quality tend to be more sensitive to economic conditions than higher rated securities. Junk bonds involve a greater risk of default by the issuer because such securities are generally unsecured and are often subordinated to other creditors’ claim. |
R. | Leverage Risk — Leverage exists when the Fund can lose more than it originally invests because it purchases or sells an instrument or enters into a transaction without investing an amount equal to the full economic exposure of the instrument or transaction. |
S. | Collateral — To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund’s practice to replace such collateral no later than the next business day. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the ���Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $500 million | 0.50% | |||
Next $500 million | 0.45% | |||
Next $500 million | 0.40% | |||
Over $1.5 billion | 0.39% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.49%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. and separate sub-advisory agreements with Invesco Capital Management LLC, formerly Invesco PowerShares Capital Management LLC, and Invesco Asset Management (India) Private Limited (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 0.85%, 1.60%, 1.10%, 0.60%, 0.60% and 0.60%, respectively, of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement.
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Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $74,091 and reimbursed class level expenses of $108,651, $52,196, $1,195, $209,535, $4 and $630 of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $51,800 in front-end sales commissions from the sale of Class A shares and $264 and $12,373 from Class A and Class C shares, respectively, for CDSC imposed upon redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
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The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
U.S. Dollar Denominated Bonds & Notes | $ | — | $ | 240,210,608 | $ | — | $ | 240,210,608 | ||||||||
Preferred Stocks | 130,219,525 | 2,088,598 | — | 132,308,123 | ||||||||||||
Common Stocks & Other Equity Interests | 105,791,352 | — | — | 105,791,352 | ||||||||||||
U.S. Treasury Securities | — | 55,856,910 | — | 55,856,910 | ||||||||||||
Exchange-Traded Notes | 55,562,540 | — | — | 55,562,540 | ||||||||||||
Non-U.S. Dollar Denominated Bonds & Notes | — | 1,566,598 | — | 1,566,598 | ||||||||||||
Variable Rate Senior Loan Interests | — | 1,384,878 | — | 1,384,878 | ||||||||||||
Money Market Funds | 11,071,578 | — | — | 11,071,578 | ||||||||||||
Total Investments in Securities | 302,644,995 | 301,107,592 | — | 603,752,587 | ||||||||||||
Other Investments — Assets* | ||||||||||||||||
Futures Contracts | 1,786,919 | — | — | 1,786,919 | ||||||||||||
Forward Foreign Currency Contracts | — | 17,046 | — | 17,046 | ||||||||||||
Swap Agreements | — | 34,137 | — | 34,137 | ||||||||||||
1,786,919 | 51,183 | — | 1,838,102 | |||||||||||||
Other Investments — Liabilities* | ||||||||||||||||
Futures Contracts | (669,976 | ) | — | — | (669,976 | ) | ||||||||||
Forward Foreign Currency Contracts | — | (3,579 | ) | — | (3,579 | ) | ||||||||||
(669,976 | ) | (3,579 | ) | — | (673,555 | ) | ||||||||||
Total Other Investments | 1,116,943 | 47,604 | — | 1,164,547 | ||||||||||||
Total Investments | $ | 303,761,938 | $ | 301,155,196 | $ | — | $ | 604,917,134 |
* | Unrealized appreciation (depreciation). |
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Statement of Assets and Liabilities.
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2018:
Value | ||||||||||||||||||||
Derivative Assets | Credit Risk | Currency Risk | Equity Risk | Interest Rate Risk | Total | |||||||||||||||
Unrealized appreciation on futures contracts — Exchange-Traded(a) | $ | — | $ | — | $ | 1,786,919 | $ | — | $ | 1,786,919 | ||||||||||
Unrealized appreciation on swap agreements — Centrally Cleared(a) | 34,137 | — | — | — | 34,137 | |||||||||||||||
Unrealized appreciation on forward foreign currency contracts outstanding | — | 17,046 | — | — | 17,046 | |||||||||||||||
Total Derivative Assets | 34,137 | 17,046 | 1,786,919 | — | 1,838,102 | |||||||||||||||
Derivatives not subject to master netting agreements | (34,137 | ) | — | (1,786,919 | ) | — | (1,821,056 | ) | ||||||||||||
Total Derivative Assets subject to master netting agreements | $ | — | $ | 17,046 | $ | — | $ | — | $ | 17,046 |
31 Invesco Multi-Asset Income Fund
Value | ||||||||||||||||||||
Derivative Liabilities | Credit Risk | Currency Risk | Equity Risk | Interest Rate Risk | Total | |||||||||||||||
Unrealized depreciation on futures contracts — Exchange-Traded(a) | $ | — | $ | — | $ | (317,884 | ) | $ | (352,092 | ) | $ | (669,976 | ) | |||||||
Unrealized depreciation on forward foreign currency contracts outstanding | — | (3,579 | ) | — | — | (3,579 | ) | |||||||||||||
Total Derivative Liabilities | — | (3,579 | ) | (317,884 | ) | (352,092 | ) | (673,555 | ) | |||||||||||
Derivatives not subject to master netting agreements | — | — | 317,884 | 352,092 | 669,976 | |||||||||||||||
Total Derivative Liabilities subject to master netting agreements | $ | — | $ | (3,579 | ) | $ | — | $ | — | $ | (3,579 | ) |
(a) | The daily variation margin receivable (payable) at period-end is recorded in the Statement of Assets and Liabilities. |
Offsetting Assets and Liabilities
The table below reflects the Fund’s exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of April 30, 2018.
Financial Derivative Assets | Financial Derivative Liabilities | Net Value of Derivatives | Collateral (Received)/Pledged | Net Amount | ||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Forward Foreign Currency Contracts | Non-Cash | Cash | ||||||||||||||||||||
Barclays Bank PLC | $ | 12,024 | $ | (3,457 | ) | $ | 8,567 | $ | — | $ | — | $ | 8,567 | |||||||||||
Citigroup Global Markets Inc. | — | (122 | ) | (122 | ) | — | — | (122 | ) | |||||||||||||||
Goldman Sachs International | 5,022 | — | 5,022 | — | — | 5,022 | ||||||||||||||||||
Total | $ | 17,046 | $ | (3,579 | ) | $ | 13,467 | $ | — | $ | — | $ | 13,467 |
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Statement of Operations | ||||||||||||||||||||
Credit Risk | Currency Risk | Equity Risk | Interest Rate Risk | Total | ||||||||||||||||
Realized Gain (Loss): | ||||||||||||||||||||
Forward foreign currency contracts | $ | — | $ | (82,166 | ) | $ | — | $ | — | $ | (82,166 | ) | ||||||||
Futures contracts | — | — | 6,342,323 | 305,435 | 6,647,758 | |||||||||||||||
Options purchased(a) | — | — | — | (28,848 | ) | (28,848 | ) | |||||||||||||
Options written | (26,448 | ) | — | — | (35,068 | ) | (61,516 | ) | ||||||||||||
Swap agreements | 189,346 | — | — | — | 189,346 | |||||||||||||||
Change in Net Unrealized Appreciation (Depreciation): | ||||||||||||||||||||
Forward foreign currency contracts | — | 21,397 | — | — | 21,397 | |||||||||||||||
Futures contracts | — | — | (3,388,182 | ) | (297,006 | ) | (3,685,188 | ) | ||||||||||||
Swap agreements | (85,043 | ) | — | — | — | (85,043 | ) | |||||||||||||
Total | $ | 77,855 | $ | (60,769 | ) | $ | 2,954,141 | $ | (55,487 | ) | $ | 2,915,740 |
(a) | Options purchased are included in the net realized gain (loss) from investment securities and the change in net unrealized appreciation (depreciation) of investment securities. |
The table below summarizes the six month average notional value of forward foreign currency contracts and futures contracts, eight day average notional value of options purchased, one and one half month average notional value of options written and four month average notional value swap agreements outstanding during the period.
Forward Foreign Currency Contracts | Futures Contracts | Options Purchased | Options Written | Swap Agreements | ||||||||||||||||
Average notional value | $ | 1,533,546 | $ | 159,520,409 | $ | 425,205 | $ | 1,689,589 | $ | 4,442,500 |
NOTE 5—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $1,109.
32 Invesco Multi-Asset Income Fund
NOTE 6—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 7—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 8—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2017.
NOTE 9—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $187,035,953 and $174,956,083, respectively. During the same period, purchases and sales of U.S. Treasury obligations were $11,834,134 and $9,068,522, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 7,018,640 | ||
Aggregate unrealized (depreciation) of investments | (32,524,684 | ) | ||
Net unrealized appreciation (depreciation) of investments | $ | (25,506,044 | ) |
Cost of investments for tax purposes is $630,770,458.
33 Invesco Multi-Asset Income Fund
NOTE 10—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 4,475,494 | $ | 48,513,799 | 14,849,703 | $ | 161,218,349 | ||||||||||
Class C | 2,278,173 | 24,510,877 | 4,808,469 | 52,215,702 | ||||||||||||
Class R | 66,051 | 710,762 | 107,694 | 1,162,484 | ||||||||||||
Class Y | 11,545,500 | 124,613,502 | 31,062,629 | 338,133,338 | ||||||||||||
Class R5 | 91 | 962 | 1,574 | 16,577 | ||||||||||||
Class R6 | 830,169 | 8,760,663 | 628,573 | 6,736,724 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 538,609 | 5,798,705 | 466,849 | 5,048,168 | ||||||||||||
Class C | 179,110 | 1,923,951 | 119,493 | 1,292,176 | ||||||||||||
Class R | 5,778 | 61,925 | 4,152 | 44,882 | ||||||||||||
Class Y | 896,967 | 9,634,891 | 521,000 | 5,680,154 | ||||||||||||
Class R5 | 42 | 444 | 72 | 771 | ||||||||||||
Class R6 | 207,029 | 2,220,641 | 248,948 | 2,679,432 | ||||||||||||
Reacquired: | ||||||||||||||||
Class A | (9,062,550 | ) | (96,649,148 | ) | (6,642,263 | ) | (71,476,790 | ) | ||||||||
Class C | (742,334 | ) | (7,869,969 | ) | (488,324 | ) | (5,275,007 | ) | ||||||||
Class R | (16,067 | ) | (169,438 | ) | (16,941 | ) | (183,979 | ) | ||||||||
Class Y | (11,798,482 | ) | (125,921,858 | ) | (4,673,930 | ) | (50,697,928 | ) | ||||||||
Class R5 | — | — | (757 | ) | (8,168 | ) | ||||||||||
Class R6 | (284,299 | ) | (2,972,220 | ) | (27,712 | ) | (296,849 | ) | ||||||||
Net increase (decrease) in share activity | (880,719 | ) | $ | (6,831,511 | ) | 40,969,229 | $ | 446,290,036 |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 70% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
In addition, 10% of the outstanding shares of the Fund are owned by the Adviser or an affiliate of the Adviser. |
34 Invesco Multi-Asset Income Fund
NOTE 11—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 11.01 | $ | 0.27 | $ | (0.49 | ) | $ | (0.22 | ) | $ | (0.28 | ) | $ | (0.09 | ) | $ | (0.37 | ) | $ | 10.42 | (2.05 | )% | $ | 138,973 | 0.84 | %(d) | 0.99 | %(d) | 5.16 | %(d) | 29 | % | |||||||||||||||||||||||
Year ended 10/31/17 | 10.51 | 0.49 | 0.50 | 0.99 | (0.49 | ) | — | (0.49 | ) | 11.01 | 9.64 | 191,395 | 0.86 | 1.06 | 4.53 | 40 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.09 | 0.47 | 0.45 | 0.92 | (0.50 | ) | — | (0.50 | ) | 10.51 | 9.44 | 91,585 | 1.04 | 1.28 | 4.60 | 101 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.37 | 0.46 | (0.25 | ) | 0.21 | (0.49 | ) | — | (0.49 | ) | 10.09 | 2.02 | 52,613 | 0.99 | 1.27 | 4.52 | 120 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.04 | 0.48 | 0.37 | 0.85 | (0.52 | ) | — | (0.52 | ) | 10.37 | 8.66 | 42,104 | 0.88 | 1.28 | 4.69 | 89 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.83 | 0.50 | (0.58 | ) | (0.08 | ) | (0.55 | ) | (0.16 | ) | (0.71 | ) | 10.04 | (0.83 | ) | 40,515 | 0.88 | 1.22 | 4.83 | 86 | ||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 11.00 | 0.23 | (0.50 | ) | (0.27 | ) | (0.23 | ) | (0.09 | ) | (0.32 | ) | 10.41 | (2.43 | ) | 88,090 | 1.59 | (d) | 1.74 | (d) | 4.41 | (d) | 29 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.50 | 0.41 | 0.50 | 0.91 | (0.41 | ) | — | (0.41 | ) | 11.00 | 8.83 | 74,211 | 1.61 | 1.81 | 3.78 | 40 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.08 | 0.39 | 0.45 | 0.84 | (0.42 | ) | — | (0.42 | ) | 10.50 | 8.62 | 24,238 | 1.79 | 2.03 | 3.85 | 101 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.36 | 0.39 | (0.26 | ) | 0.13 | (0.41 | ) | — | (0.41 | ) | 10.08 | 1.26 | 17,133 | 1.74 | 2.02 | 3.77 | 120 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.03 | 0.40 | 0.37 | 0.77 | (0.44 | ) | — | (0.44 | ) | 10.36 | 7.85 | 14,854 | 1.63 | 2.03 | 3.94 | 89 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.82 | 0.42 | (0.58 | ) | (0.16 | ) | (0.47 | ) | (0.16 | ) | (0.63 | ) | 10.03 | (1.58 | ) | 16,592 | 1.63 | 1.97 | 4.08 | 86 | ||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 11.01 | 0.26 | (0.50 | ) | (0.24 | ) | (0.26 | ) | (0.09 | ) | (0.35 | ) | 10.42 | (2.18 | ) | 2,103 | 1.09 | (d) | 1.24 | (d) | 4.91 | (d) | 29 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.51 | 0.46 | 0.50 | 0.96 | (0.46 | ) | — | (0.46 | ) | 11.01 | 9.37 | 1,608 | 1.11 | 1.31 | 4.28 | 40 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.08 | 0.44 | 0.46 | 0.90 | (0.47 | ) | — | (0.47 | ) | 10.51 | 9.28 | 538 | 1.29 | 1.53 | 4.35 | 101 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.36 | 0.44 | (0.26 | ) | 0.18 | (0.46 | ) | — | (0.46 | ) | 10.08 | 1.77 | 339 | 1.24 | 1.52 | 4.27 | 120 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.03 | 0.46 | 0.36 | 0.82 | (0.49 | ) | — | (0.49 | ) | 10.36 | 8.39 | 141 | 1.13 | 1.53 | 4.44 | 89 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.83 | 0.47 | (0.59 | ) | (0.12 | ) | (0.52 | ) | (0.16 | ) | (0.68 | ) | 10.03 | (1.17 | ) | 51 | 1.13 | 1.47 | 4.58 | 86 | ||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 11.01 | 0.29 | (0.50 | ) | (0.21 | ) | (0.29 | ) | (0.09 | ) | (0.38 | ) | 10.42 | (1.93 | ) | 317,875 | 0.59 | (d) | 0.74 | (d) | 5.41 | (d) | 29 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.51 | 0.52 | 0.50 | 1.02 | (0.52 | ) | — | (0.52 | ) | 11.01 | 9.91 | 328,798 | 0.61 | 0.81 | 4.78 | 40 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.09 | 0.50 | 0.44 | 0.94 | (0.52 | ) | — | (0.52 | ) | 10.51 | 9.71 | 31,049 | 0.79 | 1.03 | 4.85 | 101 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.37 | 0.49 | (0.26 | ) | 0.23 | (0.51 | ) | — | (0.51 | ) | 10.09 | 2.28 | 12,424 | 0.74 | 1.02 | 4.77 | 120 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.05 | 0.51 | 0.35 | 0.86 | (0.54 | ) | — | (0.54 | ) | 10.37 | 8.82 | 6,725 | 0.63 | 1.03 | 4.94 | 89 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.84 | 0.53 | (0.58 | ) | (0.05 | ) | (0.58 | ) | (0.16 | ) | (0.74 | ) | 10.05 | (0.57 | ) | 7,409 | 0.63 | 0.97 | 5.08 | 86 | ||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 11.01 | 0.29 | (0.50 | ) | (0.21 | ) | (0.29 | ) | (0.09 | ) | (0.38 | ) | 10.42 | (1.93 | ) | 30 | 0.59 | (d) | 0.64 | (d) | 5.41 | (d) | 29 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.52 | 0.52 | 0.49 | 1.01 | (0.52 | ) | — | (0.52 | ) | 11.01 | 9.81 | 30 | 0.61 | 0.72 | 4.78 | 40 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.09 | 0.50 | 0.45 | 0.95 | (0.52 | ) | — | (0.52 | ) | 10.52 | 9.82 | 19 | 0.79 | 0.90 | 4.85 | 101 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.37 | 0.49 | (0.26 | ) | 0.23 | (0.51 | ) | — | (0.51 | ) | 10.09 | 2.28 | 10 | 0.74 | 0.89 | 4.77 | 120 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.05 | 0.50 | 0.36 | 0.86 | (0.54 | ) | — | (0.54 | ) | 10.37 | 8.82 | 10 | 0.63 | 0.90 | 4.94 | 89 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.84 | 0.54 | (0.59 | ) | (0.05 | ) | (0.58 | ) | (0.16 | ) | (0.74 | ) | 10.05 | (0.57 | ) | 10 | 0.63 | 0.90 | 5.08 | 86 | ||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 11.01 | 0.29 | (0.50 | ) | (0.21 | ) | (0.29 | ) | (0.09 | ) | (0.38 | ) | 10.42 | (1.93 | ) | 65,648 | 0.60 | (d) | 0.62 | (d) | 5.40 | (d) | 29 | |||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.51 | 0.52 | 0.50 | 1.02 | (0.52 | ) | — | (0.52 | ) | 11.01 | 9.91 | 61,077 | 0.61 | 0.69 | 4.78 | 40 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 10.09 | 0.49 | 0.45 | 0.94 | (0.52 | ) | — | (0.52 | ) | 10.51 | 9.71 | 49,388 | 0.79 | 0.90 | 4.85 | 101 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.37 | 0.49 | (0.26 | ) | 0.23 | (0.51 | ) | — | (0.51 | ) | 10.09 | 2.28 | 67,568 | 0.74 | 0.89 | 4.77 | 120 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 10.04 | 0.50 | 0.37 | 0.87 | (0.54 | ) | — | (0.54 | ) | 10.37 | 8.93 | 51,057 | 0.63 | 0.90 | 4.94 | 89 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 10.84 | 0.53 | (0.59 | ) | (0.06 | ) | (0.58 | ) | (0.16 | ) | (0.74 | ) | 10.04 | (0.67 | ) | 171,140 | 0.63 | 0.85 | 5.08 | 86 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $175,194, $84,163, $1,926, $337,863, $30 and $62,397 for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
35 Invesco Multi-Asset Income Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 979.50 | $ | 4.12 | $ | 1,020.63 | $ | 4.21 | 0.84 | % | ||||||||||||
C | 1,000.00 | 975.70 | 7.79 | 1,016.91 | 7.95 | 1.59 | ||||||||||||||||||
R | 1,000.00 | 978.20 | 5.35 | 1,019.39 | 5.46 | 1.09 | ||||||||||||||||||
Y | 1,000.00 | 980.70 | 2.90 | 1,021.87 | 2.96 | 0.59 | ||||||||||||||||||
R5 | 1,000.00 | 980.70 | 2.90 | 1,021.87 | 2.96 | 0.59 | ||||||||||||||||||
R6 | 1,000.00 | 980.70 | 2.95 | 1,021.82 | 3.01 | 0.60 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
36 Invesco Multi-Asset Income Fund
Distribution Information
Correction notice
The following table sets forth on a per share basis the distribution that was paid in January 2018. Included in the table is a written statement of the sources of the distribution on a generally accepted accounting principles (“GAAP”) basis.
Net Income | Gain from Sale of Securities | Return of Principal | Total Distribution | |||||||||||||||
01/18/2018 | Class A | $ | 0.0328 | $ | 0.000 | $ | 0.0071 | $ | 0.0399 | |||||||||
01/18/2018 | Class C | $ | 0.0259 | $ | 0.000 | $ | 0.0071 | $ | 0.0330 | |||||||||
01/18/2018 | Class R | $ | 0.0305 | $ | 0.000 | $ | 0.0071 | $ | 0.0376 | |||||||||
01/18/2018 | Class Y | $ | 0.0351 | $ | 0.000 | $ | 0.0071 | $ | 0.0422 | |||||||||
01/18/2018 | Class R5 | $ | 0.0351 | $ | 0.000 | $ | 0.0071 | $ | 0.0422 | |||||||||
01/18/2018 | Class R6 | $ | 0.0351 | $ | 0.000 | $ | 0.0071 | $ | 0.0422 |
The following table sets forth on a per share basis the distribution that was paid in February 2018. Included in the table is a written statement of the sources of the distribution on a generally accepted accounting principles (“GAAP”) basis.
Net Income | Gain from Sale of Securities | Return of Principal | Total Distribution | |||||||||||||||
02/15/2018 | Class A | $ | 0.0277 | $ | 0.000 | $ | 0.0122 | $ | 0.0399 | |||||||||
02/15/2018 | Class C | $ | 0.0209 | $ | 0.000 | $ | 0.0122 | $ | 0.0331 | |||||||||
02/15/2018 | Class R | $ | 0.0254 | $ | 0.000 | $ | 0.0122 | $ | 0.0376 | |||||||||
02/15/2018 | Class Y | $ | 0.0300 | $ | 0.000 | $ | 0.0122 | $ | 0.0422 | |||||||||
02/15/2018 | Class R5 | $ | 0.0300 | $ | 0.000 | $ | 0.0122 | $ | 0.0422 | |||||||||
02/15/2018 | Class R6 | $ | 0.0300 | $ | 0.000 | $ | 0.0122 | $ | 0.0422 |
The following table sets forth on a per share basis the distribution that was paid in April 2018. Included in the table is a written statement of the sources of the distribution on a generally accepted accounting principles (“GAAP”) basis.
Net Income | Gain from Sale of Securities | Return of Principal | Total Distribution | |||||||||||||||
04/19/2018 | Class A | $ | 0.0188 | $ | 0.000 | $ | 0.0211 | $ | 0.0399 | |||||||||
04/19/2018 | Class C | $ | 0.0123 | $ | 0.000 | $ | 0.0211 | $ | 0.0344 | |||||||||
04/19/2018 | Class R | $ | 0.0167 | $ | 0.000 | $ | 0.0211 | $ | 0.0378 | |||||||||
04/19/2018 | Class Y | $ | 0.0210 | $ | 0.000 | $ | 0.0211 | $ | 0.0421 | |||||||||
04/19/2018 | Class R5 | $ | 0.0210 | $ | 0.000 | $ | 0.0211 | $ | 0.0421 | |||||||||
04/19/2018 | Class R6 | $ | 0.0210 | $ | 0.000 | $ | 0.0211 | $ | 0.0421 |
Please note that the information in the preceding chart is for financial accounting purposes only. Shareholders should be aware that the tax treatment of distributions likely differs from GAAP treatment. Form 1099-DIV for the calendar year will report distributions for federal income tax purposes. This Notice is sent to comply with certain Securities and Exchange Commission requirements.
37 Invesco Multi-Asset Income Fund
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Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
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Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your house-hold, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin send-ing you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. MAIN-SAR-1 06142018 0954
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Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco Pacific Growth Fund
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Nasdaq: | ||||
A: TGRAX ∎ C: TGRCX ∎ R: TGRRX ∎ Y: TGRDX ∎ R5: TGRSX ∎ R6: TGRUX |
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2
| Fund Performance
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4
| Letters to Shareholders
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5
| Schedule of Investments
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7
| Financial Statements
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9
| Notes to Financial Statements
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16
| Financial Highlights
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17 | Fund Expenses
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For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 4.04 | % | ||
Class C Shares | 3.67 | |||
Class R Shares | 3.91 | |||
Class Y Shares | 4.18 | |||
Class R5 Shares | 4.17 | |||
Class R6 Shares | 4.17 | |||
MSCI EAFE Index▼ (Broad Market Index) | 3.41 | |||
MSCI All Country Asia Pacific Index▼ (Style-Specific Index) | 4.58 | |||
Lipper Pacific Region Funds Index∎ (Peer Group Index) | 4.15 | |||
Source(s): ▼FactSet Research Systems, Inc.; ∎Lipper Inc. |
| |||
The MSCI EAFE® Index is an unmanaged index considered representative of stocks of Europe, Australasia and the Far East. The index is computed using the net return, which withholds applicable taxes for non-resident investors. The MSCI All Country Asia Pacific Index is an unmanaged index considered representative of Asia Pacific region stock markets. The index is computed using the net return, which withholds applicable taxes for non-resident investors. The Lipper Pacific Region Funds Index is an unmanaged index considered representative of Pacific region funds tracked by Lipper. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
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For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Pacific Growth Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
| ||||||
Class A Shares |
| |||||
Inception (7/28/97) | 3.18 | % | ||||
10 Years | 3.50 | |||||
5 Years | 7.40 | |||||
1 Year | 19.05 | |||||
Class C Shares |
| |||||
Inception (7/28/97) | 2.71 | % | ||||
10 Years | 3.33 | |||||
5 Years | 7.81 | |||||
1 Year | 24.02 | |||||
Class R Shares |
| |||||
Inception (3/31/08) | 4.38 | % | ||||
10 Years | 3.82 | |||||
5 Years | 8.32 | |||||
1 Year | 25.65 | |||||
Class Y Shares |
| |||||
Inception (7/28/97) | 3.72 | % | ||||
10 Years | 4.36 | |||||
5 Years | 8.89 | |||||
1 Year | 26.31 | |||||
Class R5 Shares |
| |||||
10 Years | 4.36 | % | ||||
5 Years | 9.01 | |||||
1 Year | 26.35 | |||||
Class R6 Shares |
| |||||
10 Years | 4.12 | % | ||||
5 Years | 8.68 | |||||
1 Year | 26.35 |
Effective June 1, 2010, Class A, Class C, Class R, Class W and Class I shares of the predecessor fund, Morgan Stanley Pacific Growth Fund Inc., advised by Morgan Stanley Investment Advisors Inc. were reorganized into Class A, Class C, Class R, Class A and Class Y shares, respectively, of Invesco Pacific Growth Fund. Returns shown above for Class A, Class C, Class R and Class Y shares are blended returns of the predecessor fund and Invesco Pacific Growth Fund. Share class returns will differ from the predecessor fund because of different expenses.
Class R5 shares incepted on May 23, 2011. Performance shown prior to that date is that of the Fund’s and the predecessor fund’s Class A shares and includes the 12b-1 fees applicable to Class A shares.
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (7/28/97) | 3.25 | % | ||||
10 Years | 4.22 | |||||
5 Years | 8.73 | |||||
1 Year | 24.05 | |||||
Class C Shares |
| |||||
Inception (7/28/97) | 2.79 | % | ||||
10 Years | 4.04 | |||||
5 Years | 9.16 | |||||
1 Year | 29.27 | |||||
Class R Shares |
| |||||
Inception (3/31/08) | 4.54 | % | ||||
10 Years | 4.54 | |||||
5 Years | 9.68 | |||||
1 Year | 30.95 | |||||
Class Y Shares |
| |||||
Inception (7/28/97) | 3.79 | % | ||||
10 Years | 5.09 | |||||
5 Years | 10.25 | |||||
1 Year | 31.59 | |||||
Class R5 Shares |
| |||||
10 Years | 5.08 | % | ||||
5 Years | 10.38 | |||||
1 Year | 31.71 | |||||
Class R6 Shares |
| |||||
10 Years | 4.84 | % | ||||
5 Years | 10.04 | |||||
1 Year | 31.67 |
Class R6 shares incepted on April 4, 2017. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.75%, 2.49%, 2.00%, 1.50%, 1.42% and 1.42%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
3 Invesco Pacific Growth Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Pacific Growth Fund
Schedule of Investments
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–96.83% |
| |||||||
Australia–4.72% | ||||||||
Cochlear Ltd. | 8,261 | $ | 1,202,079 | |||||
Commonwealth Bank of Australia | 484 | 26,075 | ||||||
National Australia Bank Ltd. | 30,256 | 657,038 | ||||||
Orora Ltd. | 838,156 | 2,101,954 | ||||||
Treasury Wine Estates Ltd. | 133,597 | 1,904,516 | ||||||
5,891,662 | ||||||||
China–14.20% | ||||||||
Baidu, Inc.–ADR(a) | 8,820 | 2,212,938 | ||||||
China Animal Healthcare Ltd.(a)(b) | 349,000 | 26,233 | ||||||
China Construction Bank Corp.–Class H | 2,316,000 | 2,428,632 | ||||||
China Vanke Co., Ltd.–Class H | 243,000 | 1,008,061 | ||||||
Ping An Insurance (Group) Co. of China Ltd.–Class H | 237,000 | 2,314,633 | ||||||
Tencent Holdings Ltd. | 162,400 | 7,973,319 | ||||||
Yum China Holdings, Inc. | 20,611 | 881,326 | ||||||
ZTE Corp.–Class H(a)(b) | 329,000 | 861,221 | ||||||
17,706,363 | ||||||||
Hong Kong–2.91% | ||||||||
AIA Group Ltd. | 213,400 | 1,905,284 | ||||||
Henderson Land Development Co. Ltd. | 121 | 767 | ||||||
Hong Kong Exchanges & Clearing Ltd. | 53,300 | 1,727,677 | ||||||
3,633,728 | ||||||||
India–7.79% | ||||||||
Bajaj Finance Ltd. | 83,463 | 2,383,218 | ||||||
Britannia Industries Ltd. | 33,795 | 2,785,361 | ||||||
Eicher Motors Ltd. | 3,724 | 1,734,291 | ||||||
Maruti Suzuki India Ltd. | 21,270 | 2,798,435 | ||||||
Praxis Home Retail Ltd.(a) | 3,491 | 14,936 | ||||||
9,716,241 | ||||||||
Indonesia–1.34% | ||||||||
PT Unilever Indonesia Tbk | 502,300 | 1,669,689 | ||||||
Japan–49.41% | ||||||||
Aida Engineering, Ltd. | 149,500 | 1,751,825 | ||||||
Daikin Industries, Ltd. | 24,100 | 2,819,364 | ||||||
Daiwa House Industry Co., Ltd. | 61,500 | 2,255,900 | ||||||
Fukushima Industries Corp. | 57,600 | 2,672,807 | ||||||
H.I.S. Co., Ltd. | 71,800 | 2,630,434 | ||||||
Hitachi High-Technologies Corp. | 45,900 | 2,138,335 | ||||||
K’s Holdings Corp. | 136,200 | 1,967,042 | ||||||
Kakaku.com, Inc. | 142,600 | 2,719,045 | ||||||
Komatsu Ltd. | 83,400 | 2,849,123 | ||||||
Konoike Transport Co., Ltd. | 126,300 | 2,207,192 | ||||||
Mitsubishi Corp. | 88,900 | 2,458,945 | ||||||
Nidec Corp. | 18,900 | 2,958,867 | ||||||
Nifco Inc. | 74,400 | 2,616,000 |
Shares | Value | |||||||
Japan–(continued) | ||||||||
Omron Corp. | 42,800 | $ | 2,315,534 | |||||
Otsuka Corp. | 58,200 | 2,707,595 | ||||||
Paltac Corp. | 44,500 | 2,226,826 | ||||||
Persol Holdings Co., Ltd. | 61,100 | 1,451,352 | ||||||
Pilot Corp. | 32,600 | 1,778,460 | ||||||
Recruit Holdings Co., Ltd. | 92,400 | 2,128,096 | ||||||
Resorttrust, Inc. | 113,100 | 2,335,052 | ||||||
SCSK Corp. | 45,100 | 1,929,677 | ||||||
Sekisui Chemical Co., Ltd. | 123,400 | 2,189,865 | ||||||
Seria Co., Ltd. | 10,100 | 495,207 | ||||||
Sompo Holdings, Inc. | 78,200 | 3,279,686 | ||||||
Sumitomo Metal Mining Co., Ltd. | 48,900 | 2,083,754 | ||||||
Yamaha Motor Co., Ltd. | 83,500 | 2,662,009 | ||||||
Yaskawa Electric Corp. | 49,300 | 2,012,012 | ||||||
61,640,004 | ||||||||
Philippines–1.18% | ||||||||
Ayala Corp. | 78,980 | 1,468,016 | ||||||
South Korea–9.08% | ||||||||
AMOREPACIFIC Group | 13,299 | 1,771,924 | ||||||
BGF Retail Co., Ltd. | 6,005 | 1,073,848 | ||||||
BGF Co., Ltd. | 11,209 | 133,284 | ||||||
NAVER Corp. | 2,206 | 1,471,597 | ||||||
Nongshim Co., Ltd. | 2,864 | 866,277 | ||||||
Ottogi Corp. | 1,079 | 799,240 | ||||||
Samsung Electronics Co., Ltd. | 2,102 | 5,215,393 | ||||||
11,331,563 | ||||||||
Taiwan–5.11% | ||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 841,143 | 6,372,276 | ||||||
Thailand–1.09% | ||||||||
Siam Cement PCL (The) | 92,200 | 1,361,860 | ||||||
Total Common Stocks & Other Equity Interests |
| 120,791,402 | ||||||
Money Market Funds–1.18% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(c) | 514,884 | 514,884 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(c) | 367,741 | 367,777 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(c) | 588,439 | 588,439 | ||||||
Total Money Market Funds |
| 1,471,100 | ||||||
TOTAL INVESTMENTS IN SECURITIES–98.01% |
| 122,262,502 | ||||||
OTHER ASSETS LESS LIABILITIES–1.99% |
| 2,480,982 | ||||||
NET ASSETS–100.00% |
| $ | 124,743,484 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Pacific Growth Fund
Investment Abbreviations:
ADR – American Depositary Receipt
Notes to Schedule of Investments:
(a) | Non-income producing security. |
(b) | Security valued using significant unobservable inputs (Level 3). See Note 3. |
(c) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2018
Information Technology | 30.4 | % | ||
Industrials | 20.0 | |||
Consumer Discretionary | 16.7 | |||
Financials | 13.0 | |||
Consumer Staples | 8.7 | |||
Materials | 4.4 | |||
Real Estate | 2.6 | |||
Health Care | 1.0 | |||
Money Market Funds Plus Other Assets Less Liabilities | 3.2 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Pacific Growth Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $94,827,001) | $ | 120,791,402 | ||
Investments in affiliated money market funds, at value (Cost $1,471,078) | 1,471,100 | |||
Foreign currencies, at value (Cost $1,360,487) | 1,349,411 | |||
Receivable for: | ||||
Investments sold | 750,323 | |||
Fund shares sold | 102,531 | |||
Dividends | 580,932 | |||
Investment for trustee deferred compensation and retirement plans | 44,247 | |||
Other assets | 57,057 | |||
Total assets | 125,147,003 | |||
Liabilities: |
| |||
Payable for: | ||||
Fund shares reacquired | 89,821 | |||
Accrued foreign taxes | 97,073 | |||
Accrued fees to affiliates | 54,082 | |||
Accrued trustees’ and officers’ fees and benefits | 1,578 | |||
Accrued other operating expenses | 65,803 | |||
Trustee deferred compensation and retirement plans | 95,162 | |||
Total liabilities | 403,519 | |||
Net assets applicable to shares outstanding | $ | 124,743,484 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 94,917,521 | ||
Undistributed net investment income | 392,976 | |||
Undistributed net realized gain | 3,495,994 | |||
Net unrealized appreciation | 25,936,993 | |||
$ | 124,743,484 |
Net Assets: |
| |||
Class A | $ | 87,596,711 | ||
Class C | $ | 7,960,931 | ||
Class R | $ | 430,211 | ||
Class Y | $ | 22,020,283 | ||
Class R5 | $ | 18,679 | ||
Class R6 | $ | 6,716,669 | ||
Shares outstanding, no par value, |
| |||
Class A | 2,504,451 | |||
Class C | 247,099 | |||
Class R | 12,458 | |||
Class Y | 617,601 | |||
Class R5 | 523 | |||
Class R6 | 188,057 | |||
Class A: | ||||
Net asset value per share | $ | 34.98 | ||
Maximum offering price per share | ||||
(Net asset value of $34.98 ¸ 94.50%) | $ | 37.02 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 32.22 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 34.53 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 35.65 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 35.72 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 35.72 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Pacific Growth Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: | ||||
Dividends (net of foreign withholding taxes of $87,226) | $ | 1,594,568 | ||
Dividends from affiliated money market funds (includes securities lending income of $107) | 19,670 | |||
Total investment income | 1,614,238 | |||
Expenses: | ||||
Advisory fees | 520,820 | |||
Administrative services fees | 24,795 | |||
Custodian fees | 45,694 | |||
Distribution fees: | ||||
Class A | 106,637 | |||
Class B | 274 | |||
Class C | 36,467 | |||
Class R | 967 | |||
Transfer agent fees — A, B, C, R and Y | 60,187 | |||
Transfer agent fees — R6 | 328 | |||
Trustees’ and officers’ fees and benefits | 13,069 | |||
Registration and filing fees | 54,494 | |||
Reports to shareholders | 13,978 | |||
Professional services fees | 35,256 | |||
Other | 7,662 | |||
Total expenses | 920,628 | |||
Less: Fees waived and expense offset arrangement(s) | (2,704 | ) | ||
Net expenses | 917,924 | |||
Net investment income | 696,314 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | 3,610,301 | |||
Foreign currencies | (85,772 | ) | ||
3,524,529 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities (net of foreign taxes of $35,639) | (474,907 | ) | ||
Foreign currencies | (24,934 | ) | ||
(499,841 | ) | |||
Net realized and unrealized gain | 3,024,688 | |||
Net increase in net assets resulting from operations | $ | 3,721,002 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Pacific Growth Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: | ||||||||
Net investment income (loss) | $ | 696,314 | $ | (270,807 | ) | |||
Net realized gain | 3,524,529 | 7,457,880 | ||||||
Change in net unrealized appreciation (depreciation) | (499,841 | ) | 14,019,025 | |||||
Net increase in net assets resulting from operations | 3,721,002 | 21,206,098 | ||||||
Distributions to shareholders from net investment income: | ||||||||
Class A | — | (127,208 | ) | |||||
Class Y | — | (33,986 | ) | |||||
Class R5 | — | (79 | ) | |||||
Total distributions from net investment income | — | (161,273 | ) | |||||
Share transactions–net: | ||||||||
Class A | 4,141,954 | (1,865,239 | ) | |||||
Class B | (127,047 | ) | (39,194 | ) | ||||
Class C | 2,305,630 | (95,579 | ) | |||||
Class R | 136,993 | (18,654 | ) | |||||
Class Y | 2,670,936 | 5,284,080 | ||||||
Class R6 | 7,107,326 | 10,005 | ||||||
Net increase in net assets resulting from share transactions | 16,235,792 | 3,275,419 | ||||||
Net increase in net assets | 19,956,794 | 24,320,244 | ||||||
Net assets: | ||||||||
Beginning of period | 104,786,690 | 80,466,446 | ||||||
End of period (includes undistributed net investment income (loss) of $392,976 and $(303,338), respectively) | $ | 124,743,484 | $ | 104,786,690 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Pacific Growth Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Effective November 30, 2010, new or additional investments in Class B shares are no longer permitted. Existing shareholders of Class B shares were permitted to continue to reinvest dividends and capital gains distributions in Class B shares until their conversion to Class A shares. Also, shareholders in Class B shares were able to exchange those shares for Class B shares of other Invesco Funds offering such shares until they converted to Class A shares. Generally, Class B shares automatically converted to Class A shares on or about the month-end, which was at least eight years after the date of purchase. Redemptions of Class B shares prior to the conversion date were subject to a CDSC. Effective January 26, 2018, all of the Fund’s outstanding Class B shares were converted to Class A shares, in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based
9 Invesco Pacific Growth Fund
on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among |
10 Invesco Pacific Growth Fund
the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 are charged to such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Securities Lending — The Fund may lend portfolio securities having a market value up to one-third of the Fund’s total assets. Such loans are secured by collateral equal to no less than the market value of the loaned securities determined daily by the securities lending provider. Such collateral will be cash or debt securities issued or guaranteed by the U.S. Government or any of its sponsored agencies. Cash collateral received in connection with these loans is invested in short-term money market instruments or affiliated money market funds and is shown as such on the Schedule of Investments. The Fund bears the risk of loss with respect to the investment of collateral. It is the Fund’s policy to obtain additional collateral from or return excess collateral to the borrower by the end of the next business day, following the valuation date of the securities loaned. Therefore, the value of the collateral held may be temporarily less than the value of the securities on loan. When loaning securities, the Fund retains certain benefits of owning the securities, including the economic equivalent of dividends or interest generated by the security. Lending securities entails a risk of loss to the Fund if, and to the extent that, the market value of the securities loaned were to increase and the borrower did not increase the collateral accordingly, and the borrower failed to return the securities. The securities loaned are subject to termination at the option of the borrower or the Fund. Upon termination, the borrower will return to the Fund the securities loaned and the Fund will return the collateral. Upon the failure of the borrower to return the securities, collateral may be liquidated and the securities may be purchased on the open market to replace the loaned securities. The Fund could experience delays and costs in gaining access to the collateral and the securities may lose value during the delay which could result in potential losses to the Fund. Some of these losses may be indemnified by the lending agent. The Fund bears the risk of any deficiency in the amount of the collateral available for return to the borrower due to any loss on the collateral invested. Dividends received on cash collateral investments for securities lending transactions, which are net of compensation to counterparties, are included in Dividends from affiliated money market funds on the Statement of Operations. The aggregate value of securities out on loan, if any, is shown as a footnote on the Statement of Assets and Liabilities. |
J. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
11 Invesco Pacific Growth Fund
K. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||
First $1 billion | 0.87% | |||
Next $1 billion | 0.82% | |||
Over $2 billion | 0.77% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.87%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2019, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.25%, 3.00%, 2.50%, 2.00%, 2.00% and 2.00%, respectively, of the Fund’s average daily net assets (the “expense limits”). Prior to their conversion to Class A shares, the expense limit for Class B shares was 3.00% of average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash (excluding investments of cash collateral from securities lending) in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $2,011.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
Shares of the Fund are distributed by Invesco Distributors, Inc. (“IDI”), an affiliate of the Adviser. The Fund has adopted a Plan of Distribution (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act. The Plan provides that the Fund will reimburse IDI for distribution related expenses that IDI incurs up to a maximum of the following annual rates: (1) Class A — up to 0.25% of the average daily net assets of Class A shares; and (2) Class C — up to 1.00% of the average daily net assets of Class C shares; and (3) Class R — up to 0.50% of the average daily net assets of Class R shares. Prior to their conversion to Class A shares, the Fund paid an annual rate of 1.00% of the average daily net assets of Class B shares. The fees are accrued daily and paid monthly.
For the six months ended April 30, 2018, expenses incurred under these agreements are shown in the Statement of Operations as Distribution fees.
12 Invesco Pacific Growth Fund
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $20,982 in front-end sales commissions from the sale of Class A shares and $20 and $41 from Class A and Class C shares, respectively, for CDSC imposed on redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were transfers from Level 1 to Level 2 of $32,820,078, due to foreign fair value adjustments and from Level 2 to Level 1 of $8,961,308, due to foreign fair value adjustments.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Australia | $ | — | $ | 5,891,662 | $ | — | $ | 5,891,662 | ||||||||
China | 3,094,264 | 13,724,645 | 887,454 | 17,706,363 | ||||||||||||
Hong Kong | — | 3,633,728 | — | 3,633,728 | ||||||||||||
India | 14,936 | 9,701,305 | — | 9,716,241 | ||||||||||||
Indonesia | — | 1,669,689 | — | 1,669,689 | ||||||||||||
Japan | 9,323,231 | 52,316,773 | — | 61,640,004 | ||||||||||||
Philippines | 1,468,016 | 1,468,016 | ||||||||||||||
South Korea | 1,207,132 | 10,124,431 | — | 11,331,563 | ||||||||||||
Taiwan | — | 6,372,276 | — | 6,372,276 | ||||||||||||
Thailand | — | 1,361,860 | — | 1,361,860 | ||||||||||||
Money Market Funds | 1,471,100 | — | — | 1,471,100 | ||||||||||||
Total Investments | $ | 15,110,663 | $ | 106,264,385 | $ | 887,454 | $ | 122,262,502 |
NOTE 4—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $693.
NOTE 5—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
13 Invesco Pacific Growth Fund
NOTE 6—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 7—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund does not have a capital loss carryforward as of October 31, 2017.
NOTE 8—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $30,347,899 and $14,914,001, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 28,292,453 | ||
Aggregate unrealized (depreciation) of investments | (2,356,565 | ) | ||
Net unrealized appreciation of investments | $ | 25,935,888 |
Cost of investments for tax purposes is $96,326,614.
14 Invesco Pacific Growth Fund
NOTE 9—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 330,032 | $ | 11,735,426 | 290,634 | $ | 8,440,185 | ||||||||||
Class B(b) | 61 | 2,081 | 729 | 18,298 | ||||||||||||
Class C | 100,236 | 3,319,391 | 26,250 | 727,646 | ||||||||||||
Class R | 6,345 | 221,900 | 3,293 | 94,438 | ||||||||||||
Class Y | 354,514 | 12,934,516 | 511,747 | 15,124,117 | ||||||||||||
Class R6(c) | 193,914 | 7,333,525 | 363 | 10,005 | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | — | — | 4,418 | 109,144 | ||||||||||||
Class Y | — | — | 1,176 | 29,500 | ||||||||||||
Conversion of Class B shares to Class A shares:(d) | ||||||||||||||||
Class A | 3,073 | 116,562 | 1,408 | 40,737 | ||||||||||||
Class B | (3,339 | ) | (116,562 | ) | (1,522 | ) | (40,737 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (217,081 | ) | (7,710,034 | ) | (382,697 | ) | (10,455,305 | ) | ||||||||
Class B(b) | (381 | ) | (12,566 | ) | (716 | ) | (16,755 | ) | ||||||||
Class C | (31,156 | ) | (1,013,761 | ) | (31,304 | ) | (823,225 | ) | ||||||||
Class R | (2,409 | ) | (84,907 | ) | (4,061 | ) | (113,092 | ) | ||||||||
Class Y | (277,380 | ) | (10,263,580 | ) | (364,417 | ) | (9,869,537 | ) | ||||||||
Class R6 | (6,220 | ) | (226,199 | ) | — | — | ||||||||||
Net increase in share activity | 450,209 | $ | 16,235,792 | 55,301 | $ | 3,275,419 |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 63% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
(b) | Class B shares activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(c) | Commencement date of April 4, 2017. |
(d) | Effective as of close of business January 26, 2018, all outstanding Class B shares were converted to Class A shares. |
15 Invesco Pacific Growth Fund
NOTE 10—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 33.63 | $ | 0.20 | (d) | $ | 1.15 | $ | 1.35 | $ | — | $ | 34.98 | 4.01 | % | $ | 87,597 | 1.54 | %(e)(f) | 1.54 | %(e)(f) | 1.16 | %(d)(e)(f) | 13 | % | |||||||||||||||||||||||
Year ended 10/31/17 | 26.31 | (0.09 | ) | 7.46 | 7.37 | (0.05 | ) | 33.63 | 28.09 | 80,319 | 1.75 | 1.75 | (0.32 | ) | 59 | |||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 24.03 | 0.04 | 2.24 | 2.28 | — | 26.31 | 9.49 | 65,107 | 1.64 | 1.64 | 0.17 | 31 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 24.51 | 0.05 | (0.50 | ) | (0.45 | ) | (0.03 | ) | 24.03 | (1.84 | ) | 66,599 | 1.78 | 1.78 | 0.21 | 137 | ||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 23.90 | 0.14 | 0.82 | 0.96 | (0.35 | ) | 24.51 | 4.10 | (f) | 73,457 | 1.77 | (f) | 1.77 | (f) | 0.60 | (f) | 63 | |||||||||||||||||||||||||||||||
Year ended 10/31/13 | 20.05 | 0.12 | 3.83 | 3.95 | (0.10 | ) | 23.90 | 19.76 | 79,672 | 1.81 | 1.81 | 0.56 | 87 | |||||||||||||||||||||||||||||||||||
Class B | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18(g) | 31.02 | 0.03 | (d) | 3.88 | 3.91 | — | 34.93 | 12.60 | — | 2.30 | (e) | 2.30 | (e) | 0.40 | (d)(e) | 13 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 24.40 | (0.28 | ) | 6.90 | 6.62 | — | 31.02 | 27.13 | 114 | 2.50 | 2.50 | (1.07 | ) | 59 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 22.46 | (0.13 | ) | 2.07 | 1.94 | — | 24.40 | 8.64 | 126 | 2.39 | 2.39 | (0.58 | ) | 31 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 23.05 | (0.12 | ) | (0.47 | ) | (0.59 | ) | — | 22.46 | (2.56 | ) | 272 | 2.53 | 2.53 | (0.54 | ) | 137 | |||||||||||||||||||||||||||||||
Year ended 10/31/14 | 22.49 | (0.04 | ) | 0.77 | 0.73 | (0.17 | ) | 23.05 | 3.28 | 480 | 2.53 | 2.53 | (0.16 | ) | 63 | |||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 18.92 | (0.04 | ) | 3.61 | 3.57 | — | 22.49 | 18.87 | 889 | 2.56 | 2.56 | (0.19 | ) | 87 | ||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 31.09 | 0.07 | (d) | 1.06 | 1.13 | — | 32.22 | 3.64 | 7,961 | 2.30 | (e) | 2.30 | (e) | 0.40 | (d)(e) | 13 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 24.46 | (0.28 | ) | 6.91 | 6.63 | — | 31.09 | 27.11 | (h) | 5,535 | 2.49 | (h) | 2.49 | (h) | (1.06 | )(h) | 59 | |||||||||||||||||||||||||||||||
Year ended 10/31/16 | 22.50 | (0.13 | ) | 2.09 | 1.96 | — | 24.46 | 8.71 | (h) | 4,477 | 2.37 | (h) | 2.37 | (h) | (0.56 | )(h) | 31 | |||||||||||||||||||||||||||||||
Year ended 10/31/15 | 23.09 | (0.12 | ) | (0.47 | ) | (0.59 | ) | — | 22.50 | (2.55 | ) | 4,880 | 2.53 | 2.53 | (0.54 | ) | 137 | |||||||||||||||||||||||||||||||
Year ended 10/31/14 | 22.53 | (0.03 | ) | 0.76 | 0.73 | (0.17 | ) | 23.09 | 3.28 | (h) | 4,638 | 2.52 | (h) | 2.52 | (h) | (0.15 | )(h) | 63 | ||||||||||||||||||||||||||||||
Year ended 10/31/13 | 18.95 | (0.04 | ) | 3.62 | 3.58 | — | 22.53 | 18.89 | 5,049 | 2.56 | 2.56 | (0.19 | ) | 87 | ||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 33.24 | 0.16 | (d) | 1.13 | 1.29 | — | 34.53 | 3.88 | 430 | 1.80 | (e) | 1.80 | (e) | 0.90 | (d)(e) | 13 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 26.02 | (0.16 | ) | 7.38 | 7.22 | — | 33.24 | 27.75 | 283 | 2.00 | 2.00 | (0.57 | ) | 59 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 23.82 | (0.02 | ) | 2.22 | 2.20 | — | 26.02 | 9.24 | 242 | 1.89 | 1.89 | (0.08 | ) | 31 | ||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 24.33 | (0.01 | ) | (0.50 | ) | (0.51 | ) | — | 23.82 | (2.10 | ) | 245 | 2.03 | 2.03 | (0.04 | ) | 137 | |||||||||||||||||||||||||||||||
Year ended 10/31/14 | 23.74 | 0.08 | 0.80 | 0.88 | (0.29 | ) | 24.33 | 3.78 | 344 | 2.03 | 2.03 | 0.34 | 63 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 19.93 | 0.07 | 3.80 | 3.87 | (0.06 | ) | 23.74 | 19.44 | 295 | 2.06 | 2.06 | 0.31 | 87 | |||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 34.24 | 0.25 | (d) | 1.16 | 1.41 | — | 35.65 | 4.12 | 22,020 | 1.30 | (e) | 1.30 | (e) | 1.40 | (d)(e) | 13 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 26.79 | (0.02 | ) | 7.59 | 7.57 | (0.12 | ) | 34.24 | 28.43 | 18,505 | 1.50 | 1.50 | (0.07 | ) | 59 | |||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 24.41 | 0.11 | 2.27 | 2.38 | — | 26.79 | 9.75 | 10,501 | 1.39 | 1.39 | 0.42 | 31 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 24.90 | 0.12 | (0.52 | ) | (0.40 | ) | (0.09 | ) | 24.41 | (1.59 | ) | 3,587 | 1.53 | 1.53 | 0.46 | 137 | ||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 24.28 | 0.20 | 0.82 | 1.02 | (0.40 | ) | 24.90 | 4.34 | 2,944 | 1.53 | 1.53 | 0.84 | 63 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 20.37 | 0.18 | 3.88 | 4.06 | (0.15 | ) | 24.28 | 20.03 | 3,291 | 1.56 | 1.56 | 0.81 | 87 | |||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 34.29 | 0.27 | (d) | 1.16 | 1.43 | — | 35.72 | 4.17 | 19 | 1.22 | (e) | 1.22 | (e) | 1.48 | (d)(e) | 13 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 26.84 | 0.00 | 7.60 | 7.60 | (0.15 | ) | 34.29 | 28.53 | 18 | 1.42 | 1.42 | 0.01 | 59 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 24.42 | 0.13 | 2.29 | 2.42 | — | 26.84 | 9.91 | 14 | 1.28 | 1.28 | 0.53 | 31 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 24.92 | 0.15 | (0.52 | ) | (0.37 | ) | (0.13 | ) | 24.42 | (1.47 | ) | 13 | 1.39 | 1.39 | 0.60 | 137 | ||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 24.30 | 0.24 | 0.82 | 1.06 | (0.44 | ) | 24.92 | 4.48 | 13 | 1.37 | 1.37 | 1.00 | 63 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 20.39 | 0.21 | 3.89 | 4.10 | (0.19 | ) | 24.30 | 20.23 | 13 | 1.43 | 1.43 | 0.94 | 87 | |||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 34.29 | 0.27 | (d) | 1.16 | 1.43 | — | 35.72 | 4.17 | 6,717 | 1.22 | (e) | 1.22 | (e) | 1.48 | (d)(e) | 13 | ||||||||||||||||||||||||||||||||
Year ended 10/31/17(i) | 27.48 | 0.00 | 6.81 | 6.81 | — | 34.29 | 24.78 | 12 | 1.39 | (j) | 1.39 | (j) | 0.04 | (j) | 59 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets includes significant dividends received during the six months ended April 30, 2018. Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets excluding the significant dividends are $0.08 and 0.48%, $(0.09) and (0.28)%, $(0.05) and (0.28)%, $0.04 and 0.22%, $0.13 and 0.72%, $0.15 and 0.80%, and $0.15 and 0.80% for Class A, Class B, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $87,415, $115, $7,354, $390, $22,219, $19 and $3,269 for Class A, Class B, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(f) | The total return, ratio of expenses to average net assets and ratio of net investment income (loss) to average net assets reflect actual 12b-1 fees of 0.24% for Class A shares for the six months ended April 30, 2018 and the year ended October 31, 2014. |
(g) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(h) | The total return, ratio of expenses to average net assets and ratio of net investment income (loss) to average net assets reflect actual 12b-1 fees of 0.99%, 0.98% and 0.99% for Class C shares for the years ended October 31, 2017, 2016 and 2014, respectively. |
(i) | Commencement date of April 4, 2017. |
(j) | Annualized. |
16 Invesco Pacific Growth Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before | Annualized Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 1,040.40 | $ | 7.79 | $ | 1,017.16 | $ | 7.70 | 1.54 | % | ||||||||||||
C | 1,000.00 | 1,036.70 | 11.61 | 1,013.39 | 11.48 | 2.30 | ||||||||||||||||||
R | 1,000.00 | 1,039.10 | 9.10 | 1,015.87 | 9.00 | 1.80 | ||||||||||||||||||
Y | 1,000.00 | 1,041.80 | 6.58 | 1,018.35 | 6.51 | 1.30 | ||||||||||||||||||
R5 | 1,000.00 | 1,041.70 | 6.18 | 1,018.74 | 6.11 | 1.22 | ||||||||||||||||||
R6 | 1,000.00 | 1,041.70 | 6.18 | 1,018.74 | 6.11 | 1.22 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
17 Invesco Pacific Growth Fund
Explore High-Conviction Investing with Invesco
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Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
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Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. MS-PGRO-SAR-1 06082018 1257
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Semiannual Report to Shareholders
| April 30, 2018 | |||
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Invesco Select Companies Fund
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Nasdaq: | ||||
A: ATIAX ∎ C: ATICX ∎ R: ATIRX ∎ Y: ATIYX ∎ R5: ATIIX ∎ R6: ATISX |
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2
| Fund Performance
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4
| Letters to Shareholders
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5
| Schedule of Investments
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7
| Financial Statements
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9
| Notes to Financial Statements
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16
| Financial Highlights
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17
| Fund Expenses
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For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes | ||||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
| |||
Class A Shares | 4.57 | % | ||
Class C Shares | 4.15 | |||
Class R Shares | 4.45 | |||
Class Y Shares | 4.72 | |||
Class R5 Shares | 4.77 | |||
Class R6 Shares | 4.76 | |||
S&P 500 Index▼ (Broad Market Index) | 3.82 | |||
Russell 2000 Index▼ (Style-Specific Index) | 3.27 | |||
Lipper Small-Cap Core Funds Index∎ (Peer Group Index) | 2.59 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
The S&P 500® Index is an unmanaged index considered representative of the US stock market.
The Russell 2000® Index is an unmanaged index considered representative of small-cap stocks. The Russell 2000 Index is a trademark/service mark of the Frank Russell Co. Russell® is a trademark of the Frank Russell Co.
The Lipper Small-Cap Core Funds Index is an unmanaged index considered representative of small-cap core funds tracked by Lipper.
The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es).
A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco Select Companies Fund
Average Annual Total Returns |
| |||||
As of 4/30/18, including maximum applicable sales charges
| ||||||
Class A Shares |
| |||||
Inception (11/4/03) | 9.99 | % | ||||
10 Years | 10.34 | |||||
5 Years | 7.46 | |||||
1 Year | 4.41 | |||||
Class C Shares |
| |||||
Inception (11/4/03) | 9.60 | % | ||||
10 Years | 10.13 | |||||
5 Years | 7.87 | |||||
1 Year | 8.72 | |||||
Class R Shares |
| |||||
Inception (4/30/04) | 10.10 | % | ||||
10 Years | 10.69 | |||||
5 Years | 8.41 | |||||
1 Year | 10.24 | |||||
Class Y Shares |
| |||||
10 Years | 11.23 | % | ||||
5 Years | 8.96 | |||||
1 Year | 10.75 | |||||
Class R5 Shares |
| |||||
Inception (4/30/04) | 10.81 | % | ||||
10 Years | 11.38 | |||||
5 Years | 9.04 | |||||
1 Year | 10.87 | |||||
Class R6 Shares |
| |||||
10 Years | 11.01 | % | ||||
5 Years | 8.78 | |||||
1 Year | 10.97 |
Class Y shares incepted on October 3, 2008. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
Class R6 shares incepted on April 4, 2017. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that
Average Annual Total Returns |
| |||||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||||
Class A Shares |
| |||||
Inception (11/4/03) | 10.19 | % | ||||
10 Years | 11.12 | |||||
5 Years | 8.02 | |||||
1 Year | 8.85 | |||||
Class C Shares |
| |||||
Inception (11/4/03) | 9.81 | % | ||||
10 Years | 10.92 | |||||
5 Years | 8.44 | |||||
1 Year | 13.33 | |||||
Class R Shares |
| |||||
Inception (4/30/04) | 10.32 | % | ||||
10 Years | 11.47 | |||||
5 Years | 8.98 | |||||
1 Year | 14.93 | |||||
Class Y Shares |
| |||||
10 Years | 12.01 | % | ||||
5 Years | 9.53 | |||||
1 Year | 15.44 | |||||
Class R5 Shares |
| |||||
Inception (4/30/04) | 11.02 | % | ||||
10 Years | 12.17 | |||||
5 Years | 9.61 | |||||
1 Year | 15.53 | |||||
Class R6 Shares |
| |||||
10 Years | 11.79 | % | ||||
5 Years | 9.33 | |||||
1 Year | 15.61 |
you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.28%, 2.03%, 1.53%, 1.03%, 0.93% and 0.85%, respectively.1 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares was 1.29%, 2.04%, 1.54%, 1.04%, 0.94% and 0.86%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 5.50% sales charge, and Class C share performance reflects the applicable contingent deferred sales
charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class R, Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information. expenses.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco Select Companies Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco Select Companies Fund
Schedule of Investments(a)
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks–91.20% |
| |||||||
Airlines–4.92% | ||||||||
Spirit Airlines, Inc.(b) | 621,810 | $ | 22,211,053 | |||||
Application Software–2.93% | ||||||||
Nuance Communications, Inc.(b) | 899,784 | 13,244,821 | ||||||
Cable & Satellite–3.88% | ||||||||
Liberty Broadband Corp.–Class A(b) | 249,022 | 17,551,071 | ||||||
Commodity Chemicals–2.67% | ||||||||
Chemtrade Logistics Income Fund (Canada) | 1,045,784 | 12,081,465 | ||||||
Communications Equipment–5.94% | ||||||||
CommScope Holding Co., Inc.(b) | 701,631 | 26,816,337 | ||||||
Consumer Finance–6.73% | ||||||||
Encore Capital Group, Inc.(b) | 681,989 | 30,416,709 | ||||||
Data Processing & Outsourced Services–11.21% | ||||||||
Alliance Data Systems Corp. | 59,127 | 12,005,737 | ||||||
Global Payments Inc. | 192,765 | 21,792,083 | ||||||
Sabre Corp. | 817,556 | 16,874,356 | ||||||
50,672,176 | ||||||||
Diversified Support Services–3.69% | ||||||||
Performant Financial Corp.(b)(c) | 5,527,196 | 16,692,132 | ||||||
Electrical Components & Equipment–4.87% | ||||||||
Regal-Beloit Corp. | 308,905 | 21,994,036 | ||||||
Environmental & Facilities Services–1.11% | ||||||||
Team, Inc.(b) | 296,491 | 5,025,522 | ||||||
Health Care Supplies–3.42% | ||||||||
Cooper Cos., Inc. (The) | 67,612 | 15,463,541 | ||||||
IT Consulting & Other Services–4.96% | ||||||||
Booz Allen Hamilton Holding Corp. | 565,823 | 22,423,566 | ||||||
Life Sciences Tools & Services–4.73% | ||||||||
Charles River Laboratories International, | 205,310 | 21,391,249 |
Shares | Value | |||||||
Oil & Gas Equipment & Services–2.67% | ||||||||
ION Geophysical Corp.(b) | 419,538 | $ | 12,082,694 | |||||
Oil & Gas Storage & Transportation–5.91% | ||||||||
GasLog Ltd. (Monaco) | 1,585,397 | 26,713,939 | ||||||
Other Diversified Financial Services–0.00% | ||||||||
Brompton Corp. (Canada)(b)(d) | 69,374 | 0 | ||||||
Publishing–5.07% | ||||||||
John Wiley & Sons, Inc.–Class A | 347,440 | 22,913,668 | ||||||
Real Estate Services–4.26% | ||||||||
Colliers International Group Inc. (Canada) | 283,272 | 19,244,490 | ||||||
Specialty Chemicals–4.57% | ||||||||
Axalta Coating Systems Ltd.(b) | 668,706 | 20,663,015 | ||||||
Systems Software–2.76% | ||||||||
TiVo Corp. | 879,815 | 12,449,382 | ||||||
Trading Companies & Distributors–4.90% | ||||||||
SiteOne Landscape Supply, Inc.(b) | 322,911 | 22,119,404 | ||||||
Total Common Stocks | 412,170,270 | |||||||
Money Market Funds–8.93% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(e) | 14,122,170 | 14,122,170 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(e) | 10,085,400 | 10,086,409 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(e) | 16,139,622 | 16,139,622 | ||||||
Total Money Market Funds | 40,348,201 | |||||||
TOTAL INVESTMENTS IN SECURITIES–100.13% |
| 452,518,471 | ||||||
OTHER ASSETS LESS LIABILITIES–(0.13)% |
| (579,953 | ) | |||||
NET ASSETS–100.00% |
| $ | 451,938,518 |
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | Affiliated company during the period. The Investment Company Act of 1940 defines an “affiliated person” as an issuance in which a fund holds 5% or more of the outstanding voting securities. The Fund has not owned enough of the outstanding voting securities of the issuer to have control (as defined in the Investment Company Act of 1940) of that issuer. The value of this security as of April 30, 2018 represented 3.69% of the Fund’s Net Assets. See Note 4. |
(d) | Security valued using significant unobservable inputs (Level 3). See Note 3. |
(e) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco Select Companies Fund
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2018
Information Technology | 27.8 | % | ||
Industrials | 19.5 | |||
Consumer Discretionary | 8.9 | |||
Energy | 8.6 | |||
Health Care | 8.2 | |||
Materials | 7.2 | |||
Financials | 6.7 | |||
Real Estate | 4.3 | |||
Money Market Funds Plus Other Assets Less Liabilities | 8.8 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco Select Companies Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: |
| |||
Investments in securities, at value (Cost $265,302,917) | $ | 395,478,138 | ||
Investments in affiliates, at value (Cost $84,806,246) | 57,040,333 | |||
Foreign currencies, at value (Cost $69,246) | 69,214 | |||
Receivable for: | ||||
Fund shares sold | 373,157 | |||
Dividends | 126,611 | |||
Investment for trustee deferred compensation and retirement plans | 157,870 | |||
Other assets | 46,607 | |||
Total assets | 453,291,930 | |||
Liabilities: |
| |||
Payable for: | ||||
Fund shares reacquired | 774,424 | |||
Accrued fees to affiliates | 344,026 | |||
Accrued trustees’ and officers’ fees and benefits | 1,888 | |||
Accrued other operating expenses | 59,350 | |||
Trustee deferred compensation and retirement plans | 173,724 | |||
Total liabilities | 1,353,412 | |||
Net assets applicable to shares outstanding | $ | 451,938,518 | ||
Net assets consist of: |
| |||
Shares of beneficial interest | $ | 364,338,231 | ||
Undistributed net investment income (loss) | (1,572,261 | ) | ||
Undistributed net realized gain (loss) | (13,237,566 | ) | ||
Net unrealized appreciation | 102,410,114 | |||
$ | 451,938,518 |
Net Assets: |
| |||
Class A | $ | 244,615,982 | ||
Class C | $ | 71,386,077 | ||
Class R | $ | 18,910,312 | ||
Class Y | $ | 89,207,671 | ||
Class R5 | $ | 27,169,188 | ||
Class R6 | $ | 649,288 | ||
Shares outstanding, no par value, |
| |||
Class A | 13,207,339 | |||
Class C | 4,583,694 | |||
Class R | 1,075,029 | |||
Class Y | 4,689,718 | |||
Class R5 | 1,362,957 | |||
Class R6 | 32,539 | |||
Class A: | ||||
Net asset value per share | $ | 18.52 | ||
Maximum offering price per share | ||||
(Net asset value of $18.52 ¸ 94.50%) | $ | 19.60 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 15.57 | ||
Class R: | ||||
Net asset value and offering price per share | $ | 17.59 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 19.02 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 19.93 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 19.95 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco Select Companies Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: |
| |||
Dividends (net of foreign withholding taxes of $76,508) | $ | 2,060,031 | ||
Dividends from affiliates | 220,635 | |||
Total investment income | 2,280,666 | |||
Expenses: | ||||
Advisory fees | 1,744,058 | |||
Administrative services fees | 67,953 | |||
Custodian fees | 11,624 | |||
Distribution fees: | ||||
Class A | 316,087 | |||
Class B | 2,712 | |||
Class C | 415,799 | |||
Class R | 53,390 | |||
Transfer agent fees — A, B, C, R and Y | 413,071 | |||
Transfer agent fees — R5 | 14,520 | |||
Transfer agent fees — R6 | 29 | |||
Trustees’ and officers’ fees and benefits | 14,026 | |||
Registration and filing fees | 55,584 | |||
Reports to shareholders | 30,265 | |||
Professional services fees | 35,501 | |||
Other | 9,698 | |||
Total expenses | 3,184,317 | |||
Less: Fees waived and expense offset arrangement(s) | (22,310 | ) | ||
Net expenses | 3,162,007 | |||
Net investment income (loss) | (881,341 | ) | ||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | (12,931,045 | ) | ||
Foreign currencies | (11,605 | ) | ||
(12,942,650 | ) | |||
Change in net unrealized appreciation of: | ||||
Investment securities | 35,717,389 | |||
Foreign currencies | 13,863 | |||
35,731,252 | ||||
Net realized and unrealized gain | 22,788,602 | |||
Net increase in net assets resulting from operations | $ | 21,907,261 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco Select Companies Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: |
| |||||||
Net investment income (loss) | $ | (881,341 | ) | $ | (2,622,151 | ) | ||
Net realized gain (loss) | (12,942,650 | ) | 67,386,302 | |||||
Change in net unrealized appreciation | 35,731,252 | 59,567,310 | ||||||
Net increase in net assets resulting from operations | 21,907,261 | 124,331,461 | ||||||
Distributions to shareholders from net realized gains: | ||||||||
Class A | (32,431,701 | ) | (11,477,261 | ) | ||||
Class B | (169,180 | ) | (93,782 | ) | ||||
Class C | (13,319,235 | ) | (4,283,225 | ) | ||||
Class R | (3,056,204 | ) | (1,126,806 | ) | ||||
Class Y | (10,068,006 | ) | (1,868,112 | ) | ||||
Class R5 | (3,307,865 | ) | (1,176,563 | ) | ||||
Class R6 | (1,367 | ) | — | |||||
Total distributions from net realized gains | (62,353,558 | ) | (20,025,749 | ) | ||||
Share transactions–net: | ||||||||
Class A | 14,767,818 | (109,707,186 | ) | |||||
Class B | (1,130,324 | ) | (1,432,978 | ) | ||||
Class C | (14,975,999 | ) | (22,745,157 | ) | ||||
Class R | (1,876,096 | ) | (12,166,848 | ) | ||||
Class Y | 15,151,068 | (18,922,200 | ) | |||||
Class R5 | 2,235,763 | (12,357,659 | ) | |||||
Class R6 | 664,053 | 10,034 | ||||||
Net increase (decrease) in net assets resulting from share transactions | 14,836,283 | (177,321,994 | ) | |||||
Net increase (decrease) in net assets | (25,610,014 | ) | (73,016,282 | ) | ||||
Net assets: | ||||||||
Beginning of period | 477,548,532 | 550,564,814 | ||||||
End of period (includes undistributed net investment income (loss) of $(1,572,261) and $(690,920), respectively) | $ | 451,938,518 | $ | 477,548,532 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco Select Companies Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is long-term growth of capital.
The Fund currently consists of six different classes of shares: Class A, Class C, Class R, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class R, Class Y, Class R5 and Class R6 shares are sold at net asset value. Effective November 30, 2010, new or additional investments in Class B shares are no longer permitted. Existing shareholders of Class B shares were permitted to continue to reinvest dividends and capital gains distributions in Class B shares until their conversion to Class A shares. Also, shareholders in Class B shares were able to exchange those shares for Class B shares of other Invesco Funds offering such shares until they converted to Class A shares. Generally, Class B shares automatically converted to Class A shares on or about the month-end, which was at least eight years after the date of purchase. Redemptions of Class B shares prior to the conversion date were subject to a CDSC. Effective January 26, 2018, all of the Fund’s outstanding Class B shares were converted to Class A shares, in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion.
Effective the open of business on October 17, 2016, the Fund re-opened public sales of its shares to all investors.
9 Invesco Select Companies Fund
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net
10 Invesco Select Companies Fund
investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 are charged to such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
J. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation)
11 Invesco Select Companies Fund
until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||||||
First $250 million | 0 | .745% | ||||||
Next $250 million | 0 | .73% | ||||||
Next $500 million | 0 | .715% | ||||||
Next $1.5 billion | 0 | .70% | ||||||
Next $2.5 billion | 0 | .685% | ||||||
Next $2.5 billion | 0 | .67% | ||||||
Next $2.5 billion | 0 | .655% | ||||||
Over $10 billion | 0 | .64% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.74%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least June 30, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waivers and/or expense reimbursements (excluding certain items discussed below) of Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares to 2.00%, 2.75%, 2.25%, 1.75%, 1.75% and 1.75%, respectively of the Fund’s average daily net assets (the “expense limits”). Prior to their conversion to Class A shares, the expense limit for Class B shares was 2.75% of average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waivers and/or expense reimbursements to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on June 30, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits without approval of the Board of Trustees. The Adviser did not waive fees and/or reimburse expenses during the period under these expense limits.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees of $18,544.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class R, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A, Class C and Class R shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares, 1.00% of the average daily net assets of Class C shares and 0.50% of the average daily net assets of Class R shares. Prior to their conversion to Class A shares, the Fund paid an annual rate of 1.00% of the average daily net assets of Class B shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $12,070 in
12 Invesco Select Companies Fund
front-end sales commissions from the sale of Class A shares and $33 and $198 from Class A, and Class C shares, respectively, for CDSC imposed on redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Common Stocks | $ | 412,170,270 | $ | — | $ | 0 | $ | 412,170,270 | ||||||||
Money Market Funds | 40,348,201 | — | — | 40,348,201 | ||||||||||||
Total Investments | $ | 452,518,471 | $ | — | $ | 0 | $ | 452,518,471 |
NOTE 4—Investments in Other Affiliates
The 1940 Act defines an “affiliated person” as an issuance in which a fund holds 5% or more of the outstanding voting securities. The Fund has not owned enough of the outstanding voting securities of the issuer to have control (as defined in the 1940 Act) of that issuer. The following is a summary of the investments in other affiliates (excluding affiliated money market funds) for the six months ended April 30, 2018.
Value 10/31/17 | Purchases at Cost | Proceeds from Sales | Change in Unrealized Appreciation | Realized Gain (Loss) | Value 04/30/18 | Dividend Income | ||||||||||||||||||||||
ION Geographical Corp(a) | $ | 7,320,183 | $ | — | $ | (8,687,010 | ) | $ | 54,811,123 | $ | (41,361,602 | ) | $ | 12,082,694 | $ | — | ||||||||||||
Performant Financial Corp. | 10,280,585 | — | — | 6,411,547 | — | 16,692,132 | — | |||||||||||||||||||||
Total | $ | 17,600,768 | $ | — | $ | (8,687,010 | ) | $ | 61,222,670 | (41,361,602 | ) | $ | 28,774,826 | $ | — |
(a) | As of April 30, 2017, this security is no longer considered as an affiliate of the fund. |
NOTE 5—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the six months ended April 30, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund’s total expenses of $3,766.
NOTE 6—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
13 Invesco Select Companies Fund
NOTE 7—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 8—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund did not have a capital loss carryforward as of October 31, 2017.
NOTE 9—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $7,819,691 and $64,942,086, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 154,271,187 | ||
Aggregate unrealized (depreciation) of investments | (52,059,433 | ) | ||
Net unrealized appreciation of investments | $ | 102,211,754 |
Cost of investments for tax purposes is $350,306,717.
14 Invesco Select Companies Fund
NOTE 10—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 748,041 | $ | 14,358,460 | 1,845,496 | $ | 34,443,840 | ||||||||||
Class B(b) | 778 | 12,773 | 2,943 | 48,034 | ||||||||||||
Class C | 105,963 | 1,722,757 | 408,324 | 6,540,411 | ||||||||||||
Class R | 96,608 | 1,779,214 | 253,977 | 4,586,806 | ||||||||||||
Class Y | 1,485,767 | 29,515,845 | 4,260,684 | 80,495,148 | ||||||||||||
Class R5 | 203,767 | 4,168,965 | 331,743 | 6,615,166 | ||||||||||||
Class R6(c) | 37,034 | 766,564 | 508 | �� | 10,034 | |||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 1,728,873 | 31,603,805 | 633,827 | 11,434,236 | ||||||||||||
Class B(b) | 10,306 | 159,223 | 5,839 | 91,796 | ||||||||||||
Class C | 847,400 | 13,066,901 | 270,789 | 4,248,675 | ||||||||||||
Class R | 175,781 | 3,055,075 | 65,096 | 1,126,806 | ||||||||||||
Class Y | 498,347 | 9,348,985 | 99,489 | 1,831,586 | ||||||||||||
Class R5 | 167,857 | 3,298,381 | 61,424 | 1,176,274 | ||||||||||||
Automatic conversion of Class B shares to Class A shares:(d) | ||||||||||||||||
Class A | 57,801 | 1,120,189 | 55,745 | 1,070,373 | ||||||||||||
Class B | (68,385 | ) | (1,120,189 | ) | (64,158 | ) | (1,070,373 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (1,675,076 | ) | (32,314,636 | ) | (8,433,372 | ) | (156,655,635 | ) | ||||||||
Class B(b) | (10,939 | ) | (182,131 | ) | (30,697 | ) | (502,435 | ) | ||||||||
Class C | (1,813,133 | ) | (29,765,657 | ) | (2,032,569 | ) | (33,534,243 | ) | ||||||||
Class R | (368,207 | ) | (6,710,385 | ) | (992,218 | ) | (17,880,460 | ) | ||||||||
Class Y | (1,176,990 | ) | (23,713,762 | ) | (5,247,516 | ) | (101,248,934 | ) | ||||||||
Class R5 | (255,146 | ) | (5,231,583 | ) | (1,010,295 | ) | (20,149,099 | ) | ||||||||
Class R6 | (5,003 | ) | (102,511 | ) | — | — | ||||||||||
Net increase (decrease) in share activity | 791,444 | $ | 14,836,283 | (9,514,941 | ) | $ | (177,321,994 | ) |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 22% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
(b) | Class B shares activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(c) | Commencement date of April 4, 2017. |
(d) | Effective as of the close of business January 26, 2018, all outstanding Class B shares were converted to Class A shares. |
15 Invesco Select Companies Fund
NOTE 11—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income (loss)(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Total distributions | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income (loss) to average net assets | Portfolio turnover(c) | |||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 20.30 | $ | (0.03 | ) | $ | 0.92 | $ | 0.89 | $ | — | $ | (2.67 | ) | $ | (2.67 | ) | $ | 18.52 | 4.57 | % | $ | 244,616 | 1.26 | %(d) | 1.27 | %(d) | (0.30 | )%(d) | 2 | % | |||||||||||||||||||||||||
Year ended 10/31/17 | 16.72 | (0.07 | ) | 4.29 | 4.22 | — | (0.64 | ) | (0.64 | ) | 20.30 | 25.71 | 250,619 | 1.27 | 1.28 | (0.39 | ) | 16 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.44 | (0.08 | ) | 0.56 | 0.48 | — | (4.20 | ) | (4.20 | ) | 16.72 | 5.22 | 305,003 | 1.24 | 1.25 | (0.53 | ) | 20 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 25.47 | (0.19 | ) | (2.37 | ) | (2.56 | ) | — | (2.47 | ) | (2.47 | ) | 20.44 | (10.79 | ) | 475,536 | 1.17 | 1.20 | (0.86 | ) | 14 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 23.95 | (0.06 | ) | 2.71 | 2.65 | — | (1.13 | ) | (1.13 | ) | 25.47 | 11.66 | 754,310 | 1.16 | 1.20 | (0.28 | ) | 10 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 20.57 | (0.12 | ) | 4.95 | 4.83 | (0.23 | ) | (1.22 | ) | (1.45 | ) | 23.95 | 25.11 | 883,072 | 1.16 | 1.20 | (0.55 | ) | 19 | |||||||||||||||||||||||||||||||||||||
Class B | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18(e) | 17.57 | (0.04 | ) | 1.51 | 1.47 | — | (2.67 | ) | (2.67 | ) | 16.37 | 9.28 | — | 2.01 | (d) | 2.02 | (d) | (1.05 | )(d) | 2 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 14.65 | (0.19 | ) | 3.75 | 3.56 | — | (0.64 | ) | (0.64 | ) | 17.57 | 24.80 | 1,199 | 2.02 | 2.03 | (1.14 | ) | 16 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 18.59 | (0.18 | ) | 0.44 | 0.26 | — | (4.20 | ) | (4.20 | ) | 14.65 | 4.36 | 2,261 | 1.99 | 2.00 | (1.28 | ) | 20 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 23.55 | (0.33 | ) | (2.16 | ) | (2.49 | ) | — | (2.47 | ) | (2.47 | ) | 18.59 | (11.44 | ) | 4,027 | 1.92 | 1.95 | (1.61 | ) | 14 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 22.40 | (0.23 | ) | 2.51 | 2.28 | — | (1.13 | ) | (1.13 | ) | 23.55 | 10.77 | 9,039 | 1.91 | 1.95 | (1.03 | ) | 10 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 19.32 | (0.26 | ) | 4.65 | 4.39 | (0.09 | ) | (1.22 | ) | (1.31 | ) | 22.40 | 24.22 | 11,551 | 1.91 | 1.95 | (1.30 | ) | 19 | |||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 17.54 | (0.09 | ) | 0.79 | 0.70 | — | (2.67 | ) | (2.67 | ) | 15.57 | 4.15 | 71,386 | 2.01 | (d) | 2.02 | (d) | (1.05 | )(d) | 2 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 14.63 | (0.19 | ) | 3.74 | 3.55 | — | (0.64 | ) | (0.64 | ) | 17.54 | 24.77 | 95,457 | 2.02 | 2.03 | (1.14 | ) | 16 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 18.57 | (0.18 | ) | 0.44 | 0.26 | — | (4.20 | ) | (4.20 | ) | 14.63 | 4.39 | 99,413 | 1.99 | 2.00 | (1.28 | ) | 20 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 23.53 | (0.33 | ) | (2.16 | ) | (2.49 | ) | — | (2.47 | ) | (2.47 | ) | 18.57 | (11.45 | ) | 125,947 | 1.92 | 1.95 | (1.61 | ) | 14 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 22.37 | (0.23 | ) | 2.52 | 2.29 | — | (1.13 | ) | (1.13 | ) | 23.53 | 10.83 | 180,853 | 1.91 | 1.95 | (1.03 | ) | 10 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 19.30 | (0.26 | ) | 4.64 | 4.38 | (0.09 | ) | (1.22 | ) | (1.31 | ) | 22.37 | 24.19 | 182,221 | 1.91 | 1.95 | (1.30 | ) | 19 | |||||||||||||||||||||||||||||||||||||
Class R | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 19.43 | (0.05 | ) | 0.88 | 0.83 | — | (2.67 | ) | (2.67 | ) | 17.59 | 4.45 | 18,910 | 1.51 | (d) | 1.52 | (d) | (0.55 | )(d) | 2 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 16.06 | (0.11 | ) | 4.12 | 4.01 | — | (0.64 | ) | (0.64 | ) | 19.43 | 25.45 | 22,747 | 1.52 | 1.53 | (0.64 | ) | 16 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 19.86 | (0.12 | ) | 0.52 | 0.40 | — | (4.20 | ) | (4.20 | ) | 16.06 | 4.90 | 29,623 | 1.49 | 1.50 | (0.78 | ) | 20 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 24.88 | (0.24 | ) | (2.31 | ) | (2.55 | ) | — | (2.47 | ) | (2.47 | ) | 19.86 | (11.03 | ) | 45,561 | 1.42 | 1.45 | (1.11 | ) | 14 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 23.48 | (0.12 | ) | 2.65 | 2.53 | — | (1.13 | ) | (1.13 | ) | 24.88 | 11.37 | 70,177 | 1.41 | 1.45 | (0.53 | ) | 10 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 20.19 | (0.17 | ) | 4.86 | 4.69 | (0.18 | ) | (1.22 | ) | (1.40 | ) | 23.48 | 24.83 | 76,385 | 1.41 | 1.45 | (0.80 | ) | 19 | |||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 20.75 | (0.00 | ) | 0.94 | 0.94 | — | (2.67 | ) | (2.67 | ) | 19.02 | 4.72 | 89,208 | 1.01 | (d) | 1.02 | (d) | (0.05 | )(d) | 2 | ||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 17.04 | (0.01 | ) | 4.36 | 4.35 | — | (0.64 | ) | (0.64 | ) | 20.75 | 26.00 | 80,572 | 1.02 | 1.03 | (0.14 | ) | 16 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 20.71 | (0.04 | ) | 0.57 | 0.53 | — | (4.20 | ) | (4.20 | ) | 17.04 | 5.44 | 81,269 | 0.99 | 1.00 | (0.28 | ) | 20 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 25.71 | (0.13 | ) | (2.40 | ) | (2.53 | ) | — | (2.47 | ) | (2.47 | ) | 20.71 | (10.56 | ) | 147,927 | 0.92 | 0.95 | (0.61 | ) | 14 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 24.11 | (0.01 | ) | 2.74 | 2.73 | — | (1.13 | ) | (1.13 | ) | 25.71 | 11.92 | 304,629 | 0.91 | 0.95 | (0.03 | ) | 10 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 20.69 | (0.06 | ) | 4.98 | 4.92 | (0.28 | ) | (1.22 | ) | (1.50 | ) | 24.11 | 25.47 | 372,632 | 0.91 | 0.95 | (0.30 | ) | 19 | |||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 21.62 | 0.00 | 0.98 | 0.98 | — | (2.67 | ) | (2.67 | ) | 19.93 | 4.72 | 27,169 | 0.92 | (d) | 0.93 | (d) | 0.04 | (d) | 2 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 17.71 | (0.01 | ) | 4.56 | 4.55 | — | (0.64 | ) | (0.64 | ) | 21.62 | 26.15 | 26,943 | 0.92 | 0.93 | (0.04 | ) | 16 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 21.33 | (0.03 | ) | 0.61 | 0.58 | — | (4.20 | ) | (4.20 | ) | 17.71 | 5.54 | 32,996 | 0.89 | 0.90 | (0.18 | ) | 20 | ||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 26.38 | (0.12 | ) | (2.46 | ) | (2.58 | ) | — | (2.47 | ) | (2.47 | ) | 21.33 | (10.47 | ) | 51,659 | 0.85 | 0.88 | (0.54 | ) | 14 | |||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 24.69 | 0.01 | 2.81 | 2.82 | — | (1.13 | ) | (1.13 | ) | 26.38 | 12.01 | 66,042 | 0.84 | 0.88 | 0.04 | 10 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 21.16 | (0.05 | ) | 5.10 | 5.05 | (0.30 | ) | (1.22 | ) | (1.52 | ) | 24.69 | 25.53 | 81,527 | 0.83 | 0.87 | (0.22 | ) | 19 | |||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 21.63 | 0.00 | 0.99 | 0.99 | — | (2.67 | ) | (2.67 | ) | 19.95 | 4.76 | 649 | 0.84 | (d) | 0.85 | (d) | 0.12 | (d) | 2 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17(f) | 20.05 | 0.01 | 1.57 | 1.58 | — | — | — | 21.63 | 7.88 | 11 | 0.84 | (g) | 0.85 | (g) | 0.04 | (g) | 16 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $254,963, $1,139, $83,849, $21,533, $86,127, $29,287 and $340 for Class A, Class B, Class C, Class R, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(f) | Commencement date of April 4, 2017. |
(g) | Annualized. |
16 Invesco Select Companies Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | |||||||||||||||||||||
A | $ | 1,000.00 | $ | 1,045.70 | $ | 6.39 | $ | 1,018.55 | $ | 6.31 | 1.26 | % | ||||||||||||
C | 1,000.00 | 1,041.50 | 10.17 | 1,014.83 | 10.04 | 2.01 | ||||||||||||||||||
R | 1,000.00 | 1,044.50 | 7.65 | 1,017.31 | 7.55 | 1.51 | ||||||||||||||||||
Y | 1,000.00 | 1,047.20 | 5.13 | 1,019.79 | 5.06 | 1.01 | ||||||||||||||||||
R5 | 1,000.00 | 1,047.70 | 4.67 | 1,020.23 | 4.61 | 0.92 | ||||||||||||||||||
R6 | 1,000.00 | 1,047.60 | 4.26 | 1,020.63 | 4.21 | 0.84 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
17 Invesco Select Companies Fund
Explore High-Conviction Investing with Invesco
Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
∎ Quarterly statements
∎ Daily confirmations
∎ Tax forms
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov.
The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. SCO-SAR-1 06112018 1152
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco U.S. Managed Volatility Fund
| ||||
Nasdaq: | ||||
R6: USMVX |
| ||||
2
| Fund Performance
| |||
3
| Letters to Shareholders
| |||
4
| Schedule of Investments
| |||
11
| Financial Statements
| |||
13
| Notes to Financial Statements
| |||
17
| Financial Highlights
| |||
18
| Fund Expenses
| |||
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes |
| |||
Cumulative total returns, 12/18/17 (inception date) to 4/30/18
|
| |||
Class R6 Shares | -1.70 | % | ||
S&P 500 Index▼ (Broad Market Index) | -0.94 | |||
Invesco US Large Cap Index∎ (Style-Specific Index) | -0.81 | |||
Lipper S&P 500 Fund Index◆ (Peer Group Index) | -1.11 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎RIMES Technologies Corp.; ◆Lipper Inc. |
| |||
The S&P 500® Index is an unmanaged index considered representative of the US stock market. The Invesco US Large Cap Index is a broad-based benchmark measuring the aggregate performance US large-cap equities. The Lipper S&P 500 Fund Index is an unmanaged index considered representative of S&P 500 funds tracked by Lipper. A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group index, if applicable, reflects fund expenses; performance of a market index does not.
|
|
Cumulative Total Returns | ||
As of 4/30/18 | ||
Class R6 Shares | ||
Inception (12/18/17) | -1.70% | |
Cumulative Total Returns | ||
As of 3/31/18, the most recent calendar quarter end | ||
Class R6 Shares | ||
Inception (12/18/17) | -1.60% |
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Performance figures reflect reinvested distributions and changes in net asset value. Shares of the Fund are sold at net asset value without a sales charge. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class R6 shares was 0.15%.1 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class R6 shares was 3.80%. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the distributor in effect through at least December 31, 2019. See current prospectus for more information. |
2 Invesco U.S. Managed Volatility Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive. |
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including performance, holdings and portfolio manager commentaries. You can access information about |
your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
3 Invesco U.S. Managed Volatility Fund
Schedule of Investments(a)
April 30, 2018
(Unaudited)
Shares | Value | |||||||
Common Stocks & Other Equity Interests–99.76% |
| |||||||
Advertising–0.08% | ||||||||
Omnicom Group Inc. | 61 | $ | 4,493 | |||||
Aerospace & Defense–2.94% | ||||||||
Arconic Inc. | 127 | 2,262 | ||||||
Boeing Co. (The) | 155 | 51,702 | ||||||
General Dynamics Corp. | 79 | 15,904 | ||||||
L3 Technologies, Inc. | 21 | 4,113 | ||||||
Lockheed Martin Corp. | 76 | 24,384 | ||||||
Northrop Grumman Corp. | 46 | 14,814 | ||||||
Raytheon Co. | 77 | 15,780 | ||||||
Rockwell Collins, Inc. | 44 | 5,832 | ||||||
TransDigm Group, Inc. | 13 | 4,167 | ||||||
United Technologies Corp. | 214 | 25,712 | ||||||
164,670 | ||||||||
Agricultural & Farm Machinery–0.21% | ||||||||
Deere & Co. | 88 | 11,909 | ||||||
Agricultural Products–0.17% | ||||||||
Archer-Daniels-Midland Co. | 146 | 6,625 | ||||||
Bunge Ltd. | 37 | 2,673 | ||||||
9,298 | ||||||||
Air Freight & Logistics–0.78% | ||||||||
C.H. Robinson Worldwide, Inc. | 37 | 3,405 | ||||||
Expeditors International of Washington, Inc. | 47 | 3,002 | ||||||
FedEx Corp. | 66 | 16,315 | ||||||
United Parcel Service, Inc.–Class B | 184 | 20,884 | ||||||
43,606 | ||||||||
Airlines–0.13% | ||||||||
American Airlines Group Inc. | 32 | 1,374 | ||||||
Delta Air Lines, Inc. | 47 | 2,454 | ||||||
Southwest Airlines Co. | 39 | 2,061 | ||||||
United Continental Holdings Inc.(b) | 19 | 1,283 | ||||||
7,172 | ||||||||
Alternative Carriers–0.09% | ||||||||
CenturyLink Inc. | 286 | 5,314 | ||||||
Apparel Retail–0.47% | ||||||||
Gap, Inc. (The) | 60 | 1,755 | ||||||
L Brands, Inc. | 63 | 2,199 | ||||||
Ross Stores, Inc. | 99 | 8,004 | ||||||
TJX Cos., Inc. (The) | 168 | 14,255 | ||||||
26,213 | ||||||||
Apparel, Accessories & Luxury Goods–0.23% | ||||||||
Tapestry, Inc. | 76 | 4,087 | ||||||
VF Corp. | 106 | 8,572 | ||||||
12,659 |
Shares | Value | |||||||
Application Software–1.35% | ||||||||
Adobe Systems Inc.(b) | 131 | $ | 29,030 | |||||
Autodesk, Inc.(b) | 59 | 7,428 | ||||||
Citrix Systems, Inc.(b) | 33 | 3,396 | ||||||
Intuit Inc. | 65 | 12,011 | ||||||
salesforce.com, inc.(b) | 183 | 22,141 | ||||||
Snap Inc.–Class A(b) | 112 | 1,605 | ||||||
75,611 | ||||||||
Asset Management & Custody Banks–1.22% | ||||||||
Ameriprise Financial, Inc. | 39 | 5,468 | ||||||
Bank of New York Mellon Corp. (The) | 266 | 14,500 | ||||||
BlackRock, Inc. | 42 | 21,903 | ||||||
Franklin Resources, Inc. | 86 | 2,893 | ||||||
Northern Trust Corp. | 60 | 6,405 | ||||||
State Street Corp. | 98 | 9,778 | ||||||
T. Rowe Price Group Inc. | 64 | 7,285 | ||||||
68,232 | ||||||||
Auto Parts & Equipment–0.05% | ||||||||
BorgWarner, Inc. | 56 | 2,741 | ||||||
Automobile Manufacturers–0.63% | ||||||||
Ford Motor Co. | 1,043 | 11,723 | ||||||
General Motors Co. | 371 | 13,630 | ||||||
Tesla, Inc.(b) | 34 | 9,993 | ||||||
35,346 | ||||||||
Automotive Retail–0.23% | ||||||||
AutoZone, Inc.(b) | 7 | 4,372 | ||||||
CarMax, Inc.(b) | 48 | 3,000 | ||||||
O’Reilly Automotive, Inc.(b) | 22 | 5,633 | ||||||
13,005 | ||||||||
Biotechnology–2.87% | ||||||||
AbbVie Inc. | 426 | 41,130 | ||||||
Alexion Pharmaceuticals, Inc.(b) | 59 | 6,940 | ||||||
Amgen Inc. | 178 | 31,058 | ||||||
Biogen Inc.(b) | 57 | 15,595 | ||||||
BioMarin Pharmaceutical Inc.(b) | 47 | 3,925 | ||||||
Celgene Corp.(b) | 192 | 16,723 | ||||||
Gilead Sciences, Inc. | 348 | 25,136 | ||||||
Incyte Corp.(b) | 56 | 3,469 | ||||||
Regeneron Pharmaceuticals, Inc.(b) | 21 | 6,377 | ||||||
Vertex Pharmaceuticals Inc.(b) | 68 | 10,415 | ||||||
160,768 | ||||||||
Brewers–0.07% | ||||||||
Molson Coors Brewing Co.–Class B | 52 | 3,705 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
4 Invesco U.S. Managed Volatility Fund
Shares | Value | |||||||
Broadcasting–0.12% | ||||||||
CBS Corp.–Class B | 85 | $ | 4,182 | |||||
Discovery, Inc.–Class A(b) | 96 | 2,270 | ||||||
6,452 | ||||||||
Cable & Satellite–1.14% | ||||||||
Charter Communications, Inc.–Class A(b) | 46 | 12,479 | ||||||
Comcast Corp.–Class A | 1,224 | 38,421 | ||||||
DISH Network Corp.–Class A(b) | 59 | 1,980 | ||||||
Liberty Broadband Corp.–Class C(b) | 46 | 3,261 | ||||||
Liberty Media Corp-Liberty SiriusXM -Series C(b) | 129 | 5,374 | ||||||
Sirius XM Holdings Inc. | 365 | 2,311 | ||||||
63,826 | ||||||||
Casinos & Gaming–0.29% | ||||||||
Las Vegas Sands Corp. | 106 | 7,773 | ||||||
MGM Resorts International | 136 | 4,273 | ||||||
Wynn Resorts Ltd. | 22 | 4,096 | ||||||
16,142 | ||||||||
Communications Equipment–1.22% | ||||||||
Cisco Systems, Inc. | 1,286 | 56,957 | ||||||
Juniper Networks, Inc. | 90 | 2,213 | ||||||
Motorola Solutions, Inc. | 43 | 4,723 | ||||||
Palo Alto Networks, Inc.(b) | 24 | 4,620 | ||||||
68,513 | ||||||||
Computer & Electronics Retail–0.09% | ||||||||
Best Buy Co., Inc. | 68 | 5,204 | ||||||
Construction Machinery & Heavy Trucks–0.64% | ||||||||
Caterpillar Inc. | 160 | 23,097 | ||||||
Cummins Inc. | 43 | 6,874 | ||||||
PACCAR Inc. | 92 | 5,858 | ||||||
35,829 | ||||||||
Construction Materials–0.13% | ||||||||
Martin Marietta Materials, Inc. | 17 | 3,311 | ||||||
Vulcan Materials Co. | 35 | 3,909 | ||||||
7,220 | ||||||||
Consumer Finance–0.91% | ||||||||
Ally Financial Inc. | 114 | 2,975 | ||||||
American Express Co. | 232 | 22,910 | ||||||
Capital One Financial Corp. | 129 | 11,690 | ||||||
Discover Financial Services | 94 | 6,697 | ||||||
Synchrony Financial | 203 | 6,734 | ||||||
51,006 | ||||||||
Copper–0.11% | ||||||||
Freeport-McMoRan Inc. | 388 | 5,902 | ||||||
Data Processing & Outsourced Services–3.18% | ||||||||
Alliance Data Systems Corp. | 14 | 2,843 | ||||||
Automatic Data Processing, Inc. | 118 | 13,933 | ||||||
Fidelity National Information Services, Inc. | 88 | 8,357 |
Shares | Value | |||||||
Data Processing & Outsourced Services–(continued) | ||||||||
Fiserv, Inc.(b) | 110 | $ | 7,795 | |||||
FleetCor Technologies Inc.(b) | 24 | 4,975 | ||||||
Mastercard Inc.–Class A | 276 | 49,203 | ||||||
Paychex, Inc. | 86 | 5,209 | ||||||
PayPal Holdings, Inc.(b) | 305 | 22,756 | ||||||
Visa Inc.–Class A | 479 | 60,775 | ||||||
Western Union Co. (The) | 123 | 2,429 | ||||||
178,275 | ||||||||
Distillers & Vintners–0.26% | ||||||||
Brown-Forman Corp.–Class B | 78 | 4,371 | ||||||
Constellation Brands, Inc.–Class A | 44 | 10,258 | ||||||
14,629 | ||||||||
Distributors–0.06% | ||||||||
Genuine Parts Co. | 39 | 3,444 | ||||||
Diversified Banks–5.55% | ||||||||
Bank of America Corp. | 2,522 | 75,458 | ||||||
Citigroup Inc. | 687 | 46,902 | ||||||
JPMorgan Chase & Co. | 912 | 99,207 | ||||||
U.S. Bancorp | 440 | 22,198 | ||||||
Wells Fargo & Co. | 1,294 | 67,236 | ||||||
311,001 | ||||||||
Diversified Chemicals–0.70% | ||||||||
DowDuPont Inc. | 625 | 39,525 | ||||||
Drug Retail–0.60% | ||||||||
CVS Health Corp. | 271 | 18,924 | ||||||
Walgreens Boots Alliance, Inc. | 222 | 14,752 | ||||||
33,676 | ||||||||
Electric Utilities–1.88% | ||||||||
American Electric Power Co., Inc. | 132 | 9,237 | ||||||
Avangrid, Inc. | 15 | 791 | ||||||
Duke Energy Corp. | 187 | 14,990 | ||||||
Edison International | 87 | 5,700 | ||||||
Entergy Corp. | 48 | 3,916 | ||||||
Eversource Energy | 84 | 5,061 | ||||||
Exelon Corp. | 260 | 10,317 | ||||||
FirstEnergy Corp. | 120 | 4,128 | ||||||
NextEra Energy, Inc. | 126 | 20,653 | ||||||
PG&E Corp. | 138 | 6,362 | ||||||
PPL Corp. | 187 | 5,442 | ||||||
Southern Co. (The) | 269 | 12,406 | ||||||
Xcel Energy, Inc. | 136 | 6,370 | ||||||
105,373 | ||||||||
Electrical Components & Equipment–0.30% | ||||||||
Emerson Electric Co. | 167 | 11,091 | ||||||
Rockwell Automation, Inc. | 34 | 5,594 | ||||||
16,685 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco U.S. Managed Volatility Fund
Shares | Value | |||||||
Electronic Components–0.23% | ||||||||
Amphenol Corp.–Class A | 81 | $ | 6,780 | |||||
Corning Inc. | 233 | 6,296 | ||||||
13,076 | ||||||||
Environmental & Facilities Services–0.27% | ||||||||
Republic Services, Inc. | 88 | 5,692 | ||||||
Waste Management, Inc. | 115 | 9,348 | ||||||
15,040 | ||||||||
Fertilizers & Agricultural Chemicals–0.31% | ||||||||
Monsanto Co. | 118 | 14,794 | ||||||
Mosaic Co. (The) | 94 | 2,533 | ||||||
17,327 | ||||||||
Financial Exchanges & Data–0.89% | ||||||||
CME Group Inc.–Class A | 91 | 14,349 | ||||||
Intercontinental Exchange, Inc. | 153 | 11,086 | ||||||
Moody’s Corp. | 51 | 8,272 | ||||||
S&P Global Inc. | 68 | 12,825 | ||||||
Thomson Reuters Corp. (The) (Canada) | 78 | 3,137 | ||||||
49,669 | ||||||||
Food Distributors–0.16% | ||||||||
Sysco Corp. | 140 | 8,756 | ||||||
Food Retail–0.10% | ||||||||
Kroger Co. (The) | 232 | 5,844 | ||||||
Footwear–0.41% | ||||||||
NIKE, Inc.–Class B | 336 | 22,979 | ||||||
General Merchandise Stores–0.42% | ||||||||
Dollar General Corp. | 72 | 6,950 | ||||||
Dollar Tree, Inc.(b) | 62 | 5,945 | ||||||
Target Corp. | 145 | 10,527 | ||||||
23,422 | ||||||||
Gold–0.10% | ||||||||
Newmont Mining Corp. | 143 | 5,618 | ||||||
Health Care Distributors–0.38% | ||||||||
AmerisourceBergen Corp. | 44 | 3,985 | ||||||
Cardinal Health, Inc. | 84 | 5,390 | ||||||
Henry Schein, Inc.(b) | 41 | 3,116 | ||||||
McKesson Corp. | 55 | 8,592 | ||||||
21,083 | ||||||||
Health Care Equipment–2.27% | ||||||||
Abbott Laboratories | 462 | 26,856 | ||||||
Baxter International Inc. | 144 | 10,008 | ||||||
Becton, Dickinson and Co. | 71 | 16,463 | ||||||
Boston Scientific Corp.(b) | 367 | 10,540 | ||||||
Danaher Corp. | 165 | 16,553 | ||||||
Edwards Lifesciences Corp.(b) | 55 | 7,005 | ||||||
IDEXX Laboratories, Inc.(b) | 23 | 4,473 | ||||||
Intuitive Surgical, Inc.(b) | 30 | 13,223 | ||||||
Stryker Corp. | 95 | 16,095 |
Shares | Value | |||||||
Health Care Equipment–(continued) | ||||||||
Zimmer Biomet Holdings, Inc. | 54 | $ | 6,219 | |||||
127,435 | ||||||||
Health Care Facilities–0.12% | ||||||||
HCA Healthcare, Inc. | 73 | 6,989 | ||||||
Health Care REITs–0.23% | ||||||||
HCP, Inc. | 126 | 2,943 | ||||||
Ventas, Inc. | 95 | 4,885 | ||||||
Welltower Inc. | 99 | 5,291 | ||||||
13,119 | ||||||||
Health Care Services–0.40% | ||||||||
DaVita Inc.(b) | 46 | 2,889 | ||||||
Express Scripts Holding Co.(b) | 151 | 11,431 | ||||||
Laboratory Corp. of America Holdings(b) | 27 | 4,610 | ||||||
Quest Diagnostics Inc. | 36 | 3,643 | ||||||
22,573 | ||||||||
Health Care Supplies–0.05% | ||||||||
DENTSPLY SIRONA Inc. | 61 | 3,071 | ||||||
Health Care Technology–0.09% | ||||||||
Cerner Corp.(b) | 85 | 4,951 | ||||||
Home Entertainment Software–0.39% | ||||||||
Activision Blizzard, Inc. | 191 | 12,673 | ||||||
Electronic Arts Inc.(b) | 80 | 9,438 | ||||||
22,111 | ||||||||
Home Furnishings–0.06% | ||||||||
Mohawk Industries, Inc.(b) | 17 | 3,568 | ||||||
Home Improvement Retail–1.35% | ||||||||
Home Depot, Inc. (The) | 312 | 57,658 | ||||||
Lowe’s Cos., Inc. | 221 | 18,217 | ||||||
75,875 | ||||||||
Hotel & Resort REITs–0.07% | ||||||||
Host Hotels & Resorts Inc. | 195 | 3,814 | ||||||
Hotels, Resorts & Cruise Lines–0.51% | ||||||||
Carnival Corp. | 108 | 6,810 | ||||||
Hilton Worldwide Holdings Inc. | 80 | 6,307 | ||||||
Marriott International Inc.–Class A | 78 | 10,661 | ||||||
Royal Caribbean Cruises Ltd. | 46 | 4,977 | ||||||
28,755 | ||||||||
Household Appliances–0.05% | ||||||||
Whirlpool Corp. | 19 | 2,944 | ||||||
Household Products–1.43% | ||||||||
Church & Dwight Co., Inc. | 65 | 3,003 | ||||||
Clorox Co. (The) | 35 | 4,102 | ||||||
Colgate-Palmolive Co. | 233 | 15,199 | ||||||
Kimberly-Clark Corp. | 93 | 9,629 | ||||||
Procter & Gamble Co. (The) | 666 | 48,178 | ||||||
80,111 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco U.S. Managed Volatility Fund
Shares | Value | |||||||
Housewares & Specialties–0.06% | ||||||||
Newell Brands, Inc. | 130 | $ | 3,592 | |||||
Hypermarkets & Super Centers–1.01% | ||||||||
Costco Wholesale Corp. | 117 | 23,068 | ||||||
Walmart Inc. | 381 | 33,703 | ||||||
56,771 | ||||||||
Industrial Conglomerates–1.77% | ||||||||
3M Co. | 159 | 30,908 | ||||||
General Electric Co. | 2,312 | 32,530 | ||||||
Honeywell International Inc. | 198 | 28,647 | ||||||
Roper Technologies, Inc. | 27 | 7,133 | ||||||
99,218 | ||||||||
Industrial Gases–0.38% | ||||||||
Air Products and Chemicals, Inc. | 59 | 9,575 | ||||||
Praxair, Inc. | 77 | 11,744 | ||||||
21,319 | ||||||||
Industrial Machinery–0.61% | ||||||||
Dover Corp. | 40 | 3,708 | ||||||
Fortive Corp. | 82 | 5,765 | ||||||
Illinois Tool Works Inc. | 91 | 12,924 | ||||||
Parker-Hannifin Corp. | 35 | 5,762 | ||||||
Stanley Black & Decker Inc. | 41 | 5,805 | ||||||
33,964 | ||||||||
Industrial REITs–0.16% | ||||||||
Prologis, Inc. | 142 | 9,217 | ||||||
Insurance Brokers–0.20% | ||||||||
Marsh & McLennan Cos., Inc. | 135 | 11,003 | ||||||
Integrated Oil & Gas–2.99% | ||||||||
Chevron Corp. | 511 | 63,931 | ||||||
Exxon Mobil Corp. | 1,130 | 87,858 | ||||||
Occidental Petroleum Corp. | 204 | 15,761 | ||||||
167,550 | ||||||||
Integrated Telecommunication Services–1.93% | ||||||||
AT&T Inc. | 1,643 | 53,726 | ||||||
Verizon Communications Inc. | 1,104 | 54,483 | ||||||
108,209 | ||||||||
Internet & Direct Marketing Retail–4.30% | ||||||||
Amazon.com, Inc.(b) | 109 | 170,708 | ||||||
Booking Holdings Inc.(b) | 13 | 28,314 | ||||||
Expedia Group, Inc. | 32 | 3,685 | ||||||
Netflix Inc.(b) | 113 | 35,308 | ||||||
Qurate Retail Group, Inc.–Class A(b) | 140 | 3,277 | ||||||
241,292 | ||||||||
Internet Software & Services–5.15% | ||||||||
Akamai Technologies, Inc.(b) | 44 | 3,153 | ||||||
Alphabet Inc.–Class A(b) | 159 | 161,954 | ||||||
eBay Inc.(b) | 247 | 9,356 |
Shares | Value | |||||||
Internet Software & Services–(continued) | ||||||||
Facebook, Inc.–Class A(b) | 634 | $ | 109,048 | |||||
Twitter, Inc.(b) | 176 | 5,335 | ||||||
288,846 | ||||||||
Investment Banking & Brokerage–1.19% | ||||||||
Charles Schwab Corp. (The) | 320 | 17,818 | ||||||
Goldman Sachs Group, Inc. (The) | 94 | 22,403 | ||||||
Morgan Stanley | 362 | 18,687 | ||||||
TD Ameritrade Holding Corp. | 138 | 8,016 | ||||||
66,924 | ||||||||
IT Consulting & Other Services–1.00% | ||||||||
Cognizant Technology Solutions Corp.–Class A | 156 | 12,764 | ||||||
DXC Technology Co. | 76 | 7,833 | ||||||
International Business Machines Corp. | 246 | 35,660 | ||||||
56,257 | ||||||||
Life & Health Insurance–0.77% | ||||||||
Aflac, Inc. | 204 | 9,296 | ||||||
Lincoln National Corp. | 58 | 4,097 | ||||||
MetLife, Inc. | 277 | 13,205 | ||||||
Principal Financial Group, Inc. | 77 | 4,560 | ||||||
Prudential Financial, Inc. | 113 | 12,014 | ||||||
43,172 | ||||||||
Life Sciences Tools & Services–0.88% | ||||||||
Agilent Technologies, Inc. | 86 | 5,654 | ||||||
Illumina, Inc.(b) | 39 | 9,396 | ||||||
IQVIA Holdings Inc.(b) | 44 | 4,213 | ||||||
Mettler-Toledo International Inc.(b) | 7 | 3,920 | ||||||
Thermo Fisher Scientific, Inc. | 107 | 22,508 | ||||||
Waters Corp.(b) | 20 | 3,768 | ||||||
49,459 | ||||||||
Managed Health Care–2.03% | ||||||||
Aetna Inc. | 87 | 15,577 | ||||||
Anthem, Inc. | 68 | 16,047 | ||||||
Cigna Corp. | 64 | 10,997 | ||||||
Humana Inc. | 35 | 10,296 | ||||||
UnitedHealth Group Inc. | 257 | 60,755 | ||||||
113,672 | ||||||||
Metal & Glass Containers–0.07% | ||||||||
Ball Corp. | 93 | 3,728 | ||||||
Mortgage REITs–0.06% | ||||||||
Annaly Capital Management, Inc. | 311 | 3,225 | ||||||
Motorcycle Manufacturers–0.03% | ||||||||
Harley-Davidson, Inc. | 45 | 1,851 | ||||||
Movies & Entertainment–1.44% | ||||||||
Time Warner Inc. | 209 | 19,813 | ||||||
Twenty-First Century Fox, Inc.–Class A | 485 | 17,732 | ||||||
Viacom Inc.–Class B | 98 | 2,956 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco U.S. Managed Volatility Fund
Shares | Value | |||||||
Movies & Entertainment–(continued) | ||||||||
Walt Disney Co. (The) | 400 | $ | 40,132 | |||||
80,633 | ||||||||
Multi-Line Insurance–0.40% | ||||||||
American International Group, Inc. | 241 | 13,496 | ||||||
Hartford Financial Services Group, Inc. (The) | 95 | 5,115 | ||||||
Loews Corp. | 71 | 3,724 | ||||||
22,335 | ||||||||
Multi-Sector Holdings–1.23% | ||||||||
Berkshire Hathaway Inc.–Class B(b) | 357 | 69,162 | ||||||
Multi-Utilities–0.88% | ||||||||
Ameren Corp. | 65 | 3,810 | ||||||
Consolidated Edison, Inc. | 83 | 6,651 | ||||||
Dominion Energy, Inc. | 174 | 11,582 | ||||||
DTE Energy Co. | 48 | 5,059 | ||||||
NiSource Inc. | 90 | 2,195 | ||||||
Public Service Enterprise Group Inc. | 135 | 7,040 | ||||||
Sempra Energy | 69 | 7,714 | ||||||
WEC Energy Group, Inc. | 84 | 5,400 | ||||||
49,451 | ||||||||
Office REITs–0.14% | ||||||||
Boston Properties, Inc. | 41 | 4,978 | ||||||
Vornado Realty Trust | 46 | 3,129 | ||||||
8,107 | ||||||||
Oil & Gas Equipment & Services–0.82% | ||||||||
Baker Hughes, a GE Co. | 114 | 4,116 | ||||||
Halliburton Co. | 233 | 12,347 | ||||||
National Oilwell Varco Inc. | 102 | 3,944 | ||||||
Schlumberger Ltd. | 369 | 25,299 | ||||||
45,706 | ||||||||
Oil & Gas Exploration & Production–1.65% | ||||||||
Anadarko Petroleum Corp. | 138 | 9,290 | ||||||
Apache Corp. | 102 | 4,177 | ||||||
Cabot Oil & Gas Corp. | 122 | 2,917 | ||||||
Concho Resources Inc.(b) | 39 | 6,131 | ||||||
ConocoPhillips | 309 | 20,240 | ||||||
Continental Resources, Inc.(b) | 23 | 1,519 | ||||||
Devon Energy Corp. | 137 | 4,977 | ||||||
EOG Resources, Inc. | 154 | 18,198 | ||||||
EQT Corp. | 68 | 3,413 | ||||||
Hess Corp. | 75 | 4,274 | ||||||
Marathon Oil Corp. | 228 | 4,161 | ||||||
Noble Energy, Inc. | 131 | 4,432 | ||||||
Pioneer Natural Resources Co. | 45 | 9,070 | ||||||
92,799 | ||||||||
Oil & Gas Refining & Marketing–0.64% | ||||||||
Marathon Petroleum Corp. | 126 | 9,438 | ||||||
Phillips 66 | 122 | 13,580 |
Shares | �� | Value | ||||||
Oil & Gas Refining & Marketing–(continued) | ||||||||
Valero Energy Corp. | 116 | $ | 12,868 | |||||
35,886 | ||||||||
Oil & Gas Storage & Transportation–0.42% | ||||||||
Cheniere Energy, Inc.(b) | 62 | 3,606 | ||||||
Kinder Morgan, Inc. | 500 | 7,910 | ||||||
ONEOK, Inc. | 108 | 6,504 | ||||||
Williams Cos., Inc. (The) | 218 | 5,609 | ||||||
23,629 | ||||||||
Packaged Foods & Meats–1.17% | ||||||||
Campbell Soup Co. | 53 | 2,161 | ||||||
Conagra Brands, Inc. | 105 | 3,892 | ||||||
General Mills, Inc. | 153 | 6,692 | ||||||
Hershey Co. (The) | 40 | 3,678 | ||||||
Hormel Foods Corp. | 142 | 5,148 | ||||||
JM Smucker Co. (The) | 30 | 3,422 | ||||||
Kellogg Co. | 92 | 5,419 | ||||||
Kraft Heinz Co. (The) | 248 | 13,982 | ||||||
Mondelez International, Inc.–Class A | 395 | 15,603 | ||||||
Tyson Foods, Inc.–Class A | 79 | 5,538 | ||||||
65,535 | ||||||||
Paper Packaging–0.10% | ||||||||
International Paper Co. | 110 | 5,672 | ||||||
Personal Products–0.20% | ||||||||
Coty Inc.–Class A(b) | 120 | 2,082 | ||||||
Estee Lauder Cos. Inc. (The)–Class A | 60 | 8,885 | ||||||
10,967 | ||||||||
Pharmaceuticals–4.44% | ||||||||
Bristol-Myers Squibb Co. | 435 | 22,677 | ||||||
Eli Lilly and Co. | 292 | 23,672 | ||||||
Johnson & Johnson | 718 | 90,820 | ||||||
Merck & Co., Inc. | 722 | 42,504 | ||||||
Pfizer Inc. | 1,592 | 58,283 | ||||||
Zoetis Inc. | 130 | 10,852 | ||||||
248,808 | ||||||||
Property & Casualty Insurance–0.58% | ||||||||
Allstate Corp. (The) | 94 | 9,195 | ||||||
Markel Corp.(b) | 4 | 4,520 | ||||||
Progressive Corp. (The) | 155 | 9,345 | ||||||
Travelers Cos., Inc. (The) | 72 | 9,475 | ||||||
32,535 | ||||||||
Railroads–0.99% | ||||||||
CSX Corp. | 235 | 13,957 | ||||||
Kansas City Southern | 27 | 2,879 | ||||||
Norfolk Southern Corp. | 75 | 10,760 | ||||||
Union Pacific Corp. | 210 | 28,062 | ||||||
55,658 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco U.S. Managed Volatility Fund
Shares | Value | |||||||
Regional Banks–1.27% | ||||||||
BB&T Corp. | 205 | $ | 10,824 | |||||
Citizens Financial Group, Inc. | 131 | 5,435 | ||||||
Fifth Third Bancorp | 183 | 6,070 | ||||||
First Republic Bank | 42 | 3,901 | ||||||
KeyCorp | 283 | 5,637 | ||||||
M&T Bank Corp. | 39 | 7,109 | ||||||
PNC Financial Services Group, Inc. (The) | 125 | 18,201 | ||||||
Regions Financial Corp. | 293 | 5,479 | ||||||
SunTrust Banks, Inc. | 124 | 8,283 | ||||||
70,939 | ||||||||
Research & Consulting Services–0.20% | ||||||||
Equifax Inc. | 32 | 3,586 | ||||||
Nielsen Holdings PLC | 96 | 3,019 | ||||||
Verisk Analytics, Inc.–Class A(b) | 44 | 4,684 | ||||||
11,289 | ||||||||
Residential REITs–0.29% | ||||||||
AvalonBay Communities, Inc. | 37 | 6,031 | ||||||
Equity Residential | 97 | 5,986 | ||||||
Essex Property Trust, Inc. | 18 | 4,314 | ||||||
16,331 | ||||||||
Restaurants–1.27% | ||||||||
Chipotle Mexican Grill, Inc.(b) | 7 | 2,963 | ||||||
McDonald’s Corp. | 213 | 35,665 | ||||||
Starbucks Corp. | 361 | 20,783 | ||||||
Yum China Holdings, Inc. (China) | 95 | 4,062 | ||||||
Yum! Brands, Inc. | 89 | 7,752 | ||||||
71,225 | ||||||||
Retail REITs–0.36% | ||||||||
GGP Inc. | 171 | 3,418 | ||||||
Realty Income Corp. | 76 | 3,839 | ||||||
Simon Property Group, Inc. | 83 | 12,976 | ||||||
20,233 | ||||||||
Semiconductor Equipment–0.47% | ||||||||
Applied Materials, Inc. | 276 | 13,709 | ||||||
KLA-Tencor Corp. | 42 | 4,273 | ||||||
Lam Research Corp. | 44 | 8,143 | ||||||
26,125 | ||||||||
Semiconductors–3.29% | ||||||||
Analog Devices, Inc. | 100 | 8,735 | ||||||
Intel Corp. | 1,252 | 64,628 | ||||||
Maxim Integrated Products, Inc. | 75 | 4,088 | ||||||
Microchip Technology Inc. | 61 | 5,103 | ||||||
Micron Technology, Inc.(b) | 297 | 13,656 | ||||||
NVIDIA Corp. | 147 | 33,060 | ||||||
QUALCOMM Inc. | 397 | 20,251 | ||||||
Skyworks Solutions, Inc. | 48 | 4,164 | ||||||
Texas Instruments Inc. | 262 | 26,575 | ||||||
Xilinx, Inc. | 69 | 4,433 | ||||||
184,693 |
Shares | Value | |||||||
Soft Drinks–1.77% | ||||||||
Coca-Cola Co. (The) | 1,133 | $ | 48,957 | |||||
Dr Pepper Snapple Group, Inc. | 48 | 5,758 | ||||||
Monster Beverage Corp.(b) | 111 | 6,105 | ||||||
PepsiCo, Inc. | 379 | 38,256 | ||||||
99,076 | ||||||||
Specialized REITs–1.12% | ||||||||
American Tower Corp.–Class A | 121 | 16,499 | ||||||
Crown Castle International Corp. | 111 | 11,197 | ||||||
Digital Realty Trust, Inc. | 55 | 5,813 | ||||||
Equinix, Inc. | 21 | 8,837 | ||||||
Public Storage | 40 | 8,071 | ||||||
SBA Communications Corp.–Class A(b) | 31 | 4,967 | ||||||
Weyerhaeuser Co. | 201 | 7,393 | ||||||
62,777 | ||||||||
Specialty Chemicals–0.49% | ||||||||
Ecolab Inc. | 77 | 11,147 | ||||||
PPG Industries, Inc. | 68 | 7,200 | ||||||
Sherwin-Williams Co. (The) | 25 | 9,192 | ||||||
27,539 | ||||||||
Specialty Stores–0.07% | ||||||||
Ulta Beauty, Inc.(b) | 15 | 3,764 | ||||||
Steel–0.09% | ||||||||
Nucor Corp. | 85 | 5,238 | ||||||
Systems Software–4.54% | ||||||||
CA, Inc. | 84 | 2,923 | ||||||
Dell Technologies Inc.–Class V(b) | 52 | 3,732 | ||||||
Microsoft Corp. | 2,026 | 189,472 | ||||||
Oracle Corp. | 797 | 36,399 | ||||||
Red Hat, Inc.(b) | 47 | 7,664 | ||||||
ServiceNow, Inc.(b) | 46 | 7,642 | ||||||
Symantec Corp. | 165 | 4,585 | ||||||
VMware, Inc.–Class A(b) | 18 | 2,399 | ||||||
254,816 | ||||||||
Technology Hardware, Storage & Peripherals–4.44% | ||||||||
Apple Inc. | 1,341 | 221,614 | ||||||
Hewlett Packard Enterprise Co. | 421 | 7,178 | ||||||
HP Inc. | 432 | 9,284 | ||||||
NetApp, Inc. | 71 | 4,727 | ||||||
Western Digital Corp. | 78 | 6,145 | ||||||
248,948 | ||||||||
Tobacco–1.11% | ||||||||
Altria Group, Inc. | 508 | 28,504 | ||||||
Philip Morris International Inc. | 414 | 33,948 | ||||||
62,452 | ||||||||
Trading Companies & Distributors–0.14% | ||||||||
Fastenal Co. | 77 | 3,849 | ||||||
W.W. Grainger, Inc. | 14 | 3,939 | ||||||
7,788 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco U.S. Managed Volatility Fund
Shares | Value | |||||||
Water Utilities–0.07% | ||||||||
American Water Works Co., Inc. | 48 | $ | 4,156 | |||||
Wireless Telecommunication Services–0.09% | ||||||||
T-Mobile US, Inc.(b) | 87 | 5,264 | ||||||
Total Common Stocks & Other Equity Interests |
| 5,594,379 |
Shares | Value | |||||||
Money Market Funds–0.15% | ||||||||
Invesco Government & Agency Portfolio–Institutional Class, 1.61%(c) | 2,861 | $ | 2,861 | |||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(c) | 2,043 | 2,044 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(c) | 3,269 | 3,269 | ||||||
Total Money Market Funds | 8,174 | |||||||
TOTAL INVESTMENTS IN SECURITIES–99.91% |
| 5,602,553 | ||||||
OTHER ASSETS LESS LIABILITIES–0.09% |
| 5,044 | ||||||
NET ASSETS–100.00% |
| $ | 5,607,597 |
Investment Abbreviations:
REIT | – Real Estate Investment Trust |
Notes to Schedule of Investments:
(a) | Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
(b) | Non-income producing security. |
(c) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2018
Information Technology | 25.3 | % | ||
Financials | 14.3 | |||
Health Care | 13.5 | |||
Consumer Discretionary | 13.4 | |||
Industrials | 9.0 | |||
Consumer Staples | 8.0 | |||
Energy | 6.5 | |||
Utilities | 2.8 | |||
Materials | 2.5 | |||
Real Estate | 2.4 | |||
Telecommunication Services | 2.1 | |||
Money Market Funds Plus Other Assets Less Liabilities | 0.2 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco U.S. Managed Volatility Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: | ||||
Investments in securities, at value (Cost $5,688,807) | $ | 5,594,379 | ||
Investments in affiliated money market funds, at value | 8,174 | |||
Receivable for: | ||||
Dividends | 4,841 | |||
Fund expenses absorbed | 37,761 | |||
Other assets | 18,375 | |||
Total assets | 5,663,530 | |||
Liabilities: | ||||
Payable for: | ||||
Accrued fees to affiliates | 2,073 | |||
Accrued trustees’ and officers’ fees and benefits | 1,466 | |||
Accrued other operating expenses | 52,394 | |||
Total liabilities | 55,933 | |||
Net assets applicable to shares outstanding | $ | 5,607,597 |
Net assets consist of: | ||||
Shares of beneficial interest | $ | 5,709,705 | ||
Undistributed net investment income | 33,954 | |||
Undistributed net realized gain (loss) | (41,635 | ) | ||
Net unrealized appreciation (depreciation) | (94,427 | ) | ||
$ | 5,607,597 | |||
Shares outstanding, no par value, | ||||
Class R6 | 570,419 | |||
Class R6: | ||||
Net asset value and offering price per share | $ | 9.83 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco U.S. Managed Volatility Fund
Statement of Operations
For the period December 18, 2017 (commencement date) through April 30, 2018
(Unaudited)
Investment income: | ||||
Dividends (net of foreign withholding taxes of $4) | $ | 36,235 | ||
Dividends from affiliated money market funds | 756 | |||
Total investment income | 36,991 | |||
Expenses: | ||||
Advisory fees | 2,073 | |||
Administrative services fees | 18,356 | |||
Custodian fees | 10,798 | |||
Transfer agent fees | 2,073 | |||
Trustees’ and officers’ fees and benefits | 7,351 | |||
Registration and filing fees | 11,687 | |||
Reports to shareholders | 9,520 | |||
Professional services fees | 40,227 | |||
Other | 6,600 | |||
Total expenses | 108,685 | |||
Less: Fees waived and expenses reimbursed | (105,648 | ) | ||
Net expenses | 3,037 | |||
Net investment income | 33,954 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | (4,891 | ) | ||
Futures contracts | (36,744 | ) | ||
(41,635 | ) | |||
Change in net unrealized appreciation (depreciation) of investment securities | (94,427 | ) | ||
Net realized and unrealized gain (loss) | (136,062 | ) | ||
Net increase (decrease) in net assets resulting from operations | $ | (102,108 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
12 Invesco U.S. Managed Volatility Fund
Statement of Changes in Net Assets
For the period December 18, 2017 (commencement date) through April 30, 2018
(Unaudited)
December 18, 2017 2018 | ||||
Operations: | ||||
Net investment income | $ | 33,954 | ||
Net realized gain (loss) | (41,635 | ) | ||
Change in net unrealized appreciation (depreciation) | (94,427 | ) | ||
Net increase (decrease) in net assets resulting from operations | (102,108 | ) | ||
Share transactions–net | 5,709,705 | |||
Net increase in net assets | 5,607,597 | |||
Net assets: | ||||
Beginning of period | — | |||
End of period (includes undistributed net investment income of $33,954) | $ | 5,607,597 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco U.S. Managed Volatility Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Fund”). The Fund is organized as a Delaware statutory Fund and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is to seek to provide capital appreciation while managing portfolio volatility.
The Fund currently consists of one class of shares, Class R6. Class R6 shares are sold at net asset value.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved
13 Invesco U.S. Managed Volatility Fund
by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Fund’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income and net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R6 are charged to such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and |
14 Invesco U.S. Managed Volatility Fund
assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Fund’s organizational documents, each Trustee, officer, employee or other agent of the Fund is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Futures Contracts — The Fund may enter into futures contracts to manage exposure to interest rate, equity and market price movements and/or currency risks. A futures contract is an agreement between two parties (“Counterparties”) to purchase or sell a specified underlying security, currency or commodity (or delivery of a cash settlement price, in the case of an index future) for a fixed price at a future date. The Fund currently invests only in exchange-traded futures and they are standardized as to maturity date and underlying financial instrument. Initial margin deposits required upon entering into futures contracts are satisfied by the segregation of specific securities or cash as collateral at the futures commission merchant (broker). During the period the futures contracts are open, changes in the value of the contracts are recognized as unrealized gains or losses by recalculating the value of the contracts on a daily basis. Subsequent or variation margin payments are received or made depending upon whether unrealized gains or losses are incurred. These amounts are reflected as receivables or payables on the Statement of Assets and Liabilities. When the contracts are closed or expire, the Fund recognizes a realized gain or loss equal to the difference between the proceeds from, or cost of, the closing transaction and the Fund’s basis in the contract. The net realized gain (loss) and the change in unrealized gain (loss) on futures contracts held during the period is included on the Statement of Operations. The primary risks associated with futures contracts are market risk and the absence of a liquid secondary market. If the Fund were unable to liquidate a futures contract and/or enter into an offsetting closing transaction, the Fund would continue to be subject to market risk with respect to the value of the contracts and continue to be required to maintain the margin deposits on the futures contracts. Futures contracts have minimal Counterparty risk since the exchange’s clearinghouse, as Counterparty to all exchange-traded futures, guarantees the futures against default. Risks may exceed amounts recognized in the Statement of Assets and Liabilities. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Fund has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund pays an advisory fee to the Adviser at the annual rate of 0.10% of the Fund’s average daily net assets.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least December 31, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or reimbursement (excluding certain items discussed below) of Class R6 shares to 0.15% of the Fund’s average daily net assets (the “expense limits”). In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the total annual fund operating expenses after fee waiver and/or reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on December 31, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waivers without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limit, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
The Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the period December 18, 2017 (commencement date) through April 30, 2018, the Adviser waived advisory fees of $103,575 and reimbursed class level expenses of $2,073 of Class R6 shares.
The Fund has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the period December 18, 2017 (commencement date) through April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Fund has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Fund’s Board of Trustees. For the period December 18, 2017 (commencement date) through April 30, 2018, the expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
The Fund has entered into a master distribution agreement with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Fund’s shares. The Fund does not pay a distribution fee to IDI under the agreement.
Certain officers and trustees of the Fund are officers and directors of the Adviser, IIS and/or IDI.
15 Invesco U.S. Managed Volatility Fund
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
As of April 30, 2018, all of the securities in this Fund were valued based on Level 1 inputs (see the Schedule of Investments for security categories). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the period December 18, 2017 (commencement date) through April 30, 2018, there were no material transfers between valuation levels.
NOTE 4—Derivative Investments
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Statement of Operations | ||||
Equity Risk | ||||
Realized Gain (Loss): | ||||
Futures contracts | $ | (36,744 | ) | |
Change in Net Unrealized Appreciation (Depreciation): | ||||
Futures contracts | — | |||
Total | $ | (36,744 | ) |
The table below summarizes the two month average notional value of futures contracts outstanding during the period.
Futures Contracts | ||||
Average notional value | $ | 6,996,940 |
NOTE 5—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6—Cash Balances
The Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Fund Company, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 7—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss
16 Invesco U.S. Managed Volatility Fund
carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
NOTE 8—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the period December 18, 2017 (commencement date) through April 30, 2018 was $5,898,286 and $204,054, respectively. In a fund’s initial year of operations, the cost of investments for tax purposes will not reflect any tax adjustments until its fiscal year-end reporting period.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 222,542 | ||
Aggregate unrealized (depreciation) of investments | (316,969 | ) | ||
Net unrealized appreciation (depreciation) of investments | $ | (94,427 | ) |
Cost of investments is the same for tax and financial reporting purposes.
NOTE 9—Share Information
Summary of Share Activity | ||||||||
December 18, 2017 (commencement date) through April 30, 2018(a) | ||||||||
Shares | Amount | |||||||
Sold | 579,061 | $ | 5,800,298 | |||||
Reacquired | (8,642 | ) | (90,593 | ) | ||||
Net increase in share activity | 570,419 | $ | 5,709,705 |
(a) | 88% of the outstanding shares of the Fund are owned by the Adviser. |
NOTE 10—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Net asset value, end of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of expenses to average net assets with fee waivers and/or expenses absorbed | Ratio of expenses to average net assets without fee waivers and/or expenses absorbed | Ratio of net investment income to average net assets | Portfolio turnover(c) | ||||||||||||||||||||||||||||||||||
Period ended 04/30/18(d) | $ | 10.00 | $ | 0.06 | $ | (0.23 | ) | $ | (0.17 | ) | $ | 9.83 | (1.70 | )% | $ | 5,608 | 0.15 | %(e) | 5.25 | %(e) | 1.63 | %(e) | 4 | % |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Commencement date of December 18, 2017. |
(e) | Ratios are annualized and based on average daily net assets (000’s omitted) of $5,646 for Class R6 shares. |
17 Invesco U.S. Managed Volatility Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. With the exception of the actual ending account value and expenses of the Class R6 shares, the example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018. The actual ending account value and expenses of the Class R6 shares in the example below are based on an investment of $1,000 invested as of close of business December 18, 2017 (commencement date) and held through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period (as of close of business December 18, 2017 through April 30, 2018 for the Class R6 shares). Because the actual ending account value and expense information in the example is not based upon a six month period for the Class R6 shares, the ending account value and expense information may not provide a meaningful comparison to mutual funds that provide such information for a full six month period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Class | Beginning Account Value (11/01/17) | ACTUAL | HYPOTHETICAL (5% annual return before expenses) | Annualized Expense Ratio | ||||||||||||||||||||
Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2,3 | |||||||||||||||||||||
R6 | $ | 1,000.00 | $ | 983.00 | $ | 0.55 | $ | 1,024.05 | $ | 0.75 | 0.15 | % |
1 | The actual ending account value is based on the actual total return of the Fund for the period December 18, 2017 (commencement date) through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Actual expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 134 (as of close of business December 18, 2017 (commencement date) through April 30, 2018)/365. Because the Fund has not been in existence for a full six month period, the actual ending account value and expense information shown may not provide a meaningful comparison to fund expense information of classes that show such data for a full six month period and, because the actual ending account value and expense information in the expense example covers a short time period, return and expense data may not be indicative of return and expense data for longer time periods. |
3 | Hypothetical expenses are equal to the annualized expense ratio indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect a one-half year period. The hypothetical ending account value and expenses may be used to compare ongoing costs of investing in the Fund and other funds because such data is based on a full six month period. |
18 Invesco U.S. Managed Volatility Fund
Explore High-Conviction Investing with Invesco
Go paperless with eDelivery
Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
∎ Quarterly statements
∎ Daily confirmations
∎ Tax forms
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. |
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. USMGV-SAR-1 06202018 1009
| ||||
Semiannual Report to Shareholders
| April 30, 2018 | |||
| ||||
Invesco World Bond Fund
| ||||
Nasdaq: | ||||
A: AUBAX ∎ C: AUBCX ∎ Y: AUBYX ∎ R5: AUBIX ∎ R6: AUBFX |
| ||||
2
| Fund Performance
| |||
4
| Letters to Shareholders
| |||
5
| Schedule of Investments
| |||
11
| Financial Statements
| |||
13
| Notes to Financial Statements
| |||
23
| Financial Highlights
| |||
24
| Fund Expenses
| |||
For the most current month-end Fund performance and commentary, please visit invesco.com/performance.
Unless otherwise noted, all data provided by Invesco.
This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing.
| ||||
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Fund Performance
Performance summary
|
| |||
Fund vs. Indexes |
| |||
Cumulative total returns, 10/31/17 to 4/30/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance.
|
| |||
Class A Shares | 0.23 | % | ||
Class C Shares | -0.15 | |||
Class Y Shares | 0.35 | |||
Class R5 Shares | 0.26 | |||
Class R6 Shares | 0.35 | |||
Bloomberg Barclays Global Aggregate Index▼ (Broad Market/Style-Specific Index) | 1.19 | |||
Lipper Global Income Funds Index∎ (Peer Group Index) | 0.58 | |||
Source(s): ▼FactSet Research Systems Inc.; ∎Lipper Inc. |
| |||
The Bloomberg Barclays Global Aggregate Index is an unmanaged index considered representative of global investment grade, fixed income markets. The Lipper Global Income Funds Index is an unmanaged index considered representative of global income funds tracked by Lipper. The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not.
|
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For more information about your Fund
Read the most recent quarterly commentary from your Fund’s portfolio managers by visiting invesco.com/us. Click on “Products” and select “Mutual Funds.” Use the “Product Finder” to locate your Fund; then click on its name to access its product detail page. There, you can learn more about your Fund’s investment strategies, holdings and performance.
Also, visit blog.invesco.us.com, where many of Invesco’s investment professionals share their insights about market and economic news and trends.
2 Invesco World Bond Fund
Average Annual Total Returns |
| |||
As of 4/30/18, including maximum applicable sales charges
|
| |||
Class A Shares |
| |||
Inception (3/31/06) | 3.05 | % | ||
10 Years | 1.61 | |||
5 Years | 0.21 | |||
1 Year | -0.65 | |||
Class C Shares |
| |||
Inception (3/31/06) | 2.63 | % | ||
10 Years | 1.28 | |||
5 Years | 0.32 | |||
1 Year | 1.95 | |||
Class Y Shares |
| |||
10 Years | 2.29 | % | ||
5 Years | 1.32 | |||
1 Year | 3.99 | |||
Class R5 Shares |
| |||
Inception (3/31/06) | 3.66 | % | ||
10 Years | 2.29 | |||
5 Years | 1.30 | |||
1 Year | 3.89 | |||
Class R6 Shares |
| |||
10 Years | 2.19 | % | ||
5 Years | 1.34 | |||
1 Year | 3.98 |
Class Y shares incepted on October 3, 2008. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
Class R6 shares incepted on September 24, 2012. Performance shown prior to that date is that of Class A shares and includes the 12b-1 fees applicable to Class A shares.
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Performance figures do not reflect deduction of taxes a shareholder would pay on Fund distributions or sale of Fund shares. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The net annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date
Average Annual Total Returns |
| |||
As of 3/31/18, the most recent calendar quarter end, including maximum applicable sales charges
|
| |||
Class A Shares |
| |||
Inception (3/31/06) | 3.25 | % | ||
10 Years | 1.45 | |||
5 Years | 0.94 | |||
1 Year | 2.63 | |||
Class C Shares |
| |||
Inception (3/31/06) | 2.84 | % | ||
10 Years | 1.12 | |||
5 Years | 1.07 | |||
1 Year | 5.50 | |||
Class Y Shares |
| |||
10 Years | 2.12 | % | ||
5 Years | 2.08 | |||
1 Year | 7.47 | |||
Class R5 Shares |
| |||
Inception (3/31/06) | 3.87 | % | ||
10 Years | 2.13 | |||
5 Years | 2.06 | |||
1 Year | 7.47 | |||
Class R6 Shares |
| |||
10 Years | 2.02 | % | ||
5 Years | 2.08 | |||
1 Year | 7.46 |
of this report for Class A, Class C, Class Y, Class R5 and Class R6 shares was 0.94%, 1.69%, 0.69%, 0.69% and 0.69%, respectively.1,2 The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class C, Class Y, Class R5 and Class R6 shares was 2.22%, 2.97%, 1.97%, 1.78%, and 1.78%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 4.25% sales charge, and Class C share performance reflects the applicable contingent deferred sales charge (CDSC) for the period involved. The CDSC on Class C shares is 1% for the first year after purchase. Class Y, Class R5 and Class R6 shares do not have a front-end sales charge or a CDSC; therefore, performance is at net asset value.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
1 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least February 28, 2019. See current prospectus for more information. |
2 | Total annual Fund operating expenses after any contractual fee waivers and/or expense reimbursements by the adviser in effect through at least June 30, 2020. See current prospectus for more information. |
3 Invesco World Bond Fund
Letters to Shareholders
Bruce Crockett | Dear Fellow Shareholders: As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment. This includes but is not limited to: ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time; monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions; assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s |
prospectus; and monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
Philip Taylor | Dear Shareholders: This semiannual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. The investment professionals at Invesco invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including |
performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.”
Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg.
For questions about your account, contact an Invesco client services representative at 800 959 4246. For Invesco-related questions or comments, please email me directly at phil@invesco.com.
All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us.
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
4 Invesco World Bond Fund
Schedule of Investments
April 30, 2018
(Unaudited)
Principal Amount | Value | |||||||
Non U.S. Dollar Denominated Bonds & Notes–46.24%(a) |
| |||||||
Argentina–0.50% | ||||||||
Provincia de Buenos Aires, REGS, Unsec. Floating Rate Bonds, 27.00% (BADLAR + 3.75%), 04/12/2025(b)(c) | ARS | 3,055,000 | $ | 150,417 | ||||
Australia–2.33% | ||||||||
Australia Government Bond, REGS, Series 136, Sr. Unsec. Bonds, 4.75%, 04/21/2027(b) | AUD | 800,000 | 698,003 | |||||
Brazil–1.22% | ||||||||
Brazil Letras do Tesouro Nacional, Unsec. Bills, 0.00%, 01/01/2022(d) | BRL | 1,740,000 | 366,695 | |||||
Canada–1.77% | ||||||||
Canadian Government Bond, Sr. Unsec. Bonds, 2.00%, 06/01/2028 | CAD | 700,000 | 530,767 | |||||
China–0.41% | ||||||||
Eagle Intermediate Global Holding B.V./Ruyi US Finance LLC, Sr. Sec. Gtd. First Lien Bonds, 5.38%, 05/01/2023(b) | EUR | 100,000 | 123,789 | |||||
Dominican Republic–0.56% | ||||||||
Dominican Republic International Bond, Sr. Unsec. Notes, 8.90%, 02/15/2023(b) | DOP | 8,000,000 | 167,234 | |||||
Egypt–0.60% | ||||||||
Egypt Government International Bond, Sr. Unsec. Bonds, 5.63%, 04/16/2030(b) | EUR | 151,000 | 180,526 | |||||
France–1.85% | ||||||||
Orange S.A., REGS, Jr. Unsec. Sub. Euro Notes, 5.88%(b)(e) | GBP | 200,000 | 306,444 | |||||
TOTAL S.A., REGS, Jr. Unsec. Sub. Medium-Term Euro Notes, | EUR | 200,000 | 249,239 | |||||
555,683 | ||||||||
Germany–0.65% | ||||||||
Volkswagen International Finance N.V., REGS, Jr. Unsec. Gtd. Sub. Euro Bonds, 3.88%(b)(e) | EUR | 160,000 | 195,599 | |||||
India–1.50% | ||||||||
Province of British Columbia, Sr. Unsec. Bonds, 6.60%, 01/09/2020(b) | INR | 30,000,000 | 448,793 |
Principal Amount | Value | |||||||
Indonesia–3.85% | ||||||||
Indonesia Treasury Bond, | ||||||||
Series FR54, Sr. Unsec. Bonds, | ||||||||
9.50%, 07/15/2031 | IDR | 6,200,000,000 | $ | 525,494 | ||||
Series FR72, Sr. Unsec. Bonds, | ||||||||
8.25%, 05/15/2036 | IDR | 4,300,000,000 | 331,934 | |||||
Series FR75, Sr. Unsec. Bonds, | ||||||||
7.50%, 05/15/2038 | IDR | 4,100,000,000 | 295,572 | |||||
1,153,000 | ||||||||
Italy–1.52% | ||||||||
Italy Buoni Poliennali del Tesoro, REGS, Sr. Unsec. Euro Bonds, 2.80%, 03/01/2067(b) | EUR | 400,000 | 456,194 | |||||
Ivory Coast–0.43% | ||||||||
Ivory Coast Government International Bond, | EUR | 100,000 | 127,935 | |||||
Japan–3.90% | ||||||||
Japan Government Forty Year Bond, Series 9, Sr. Unsec. Bonds, 0.40%, 03/20/2056 | JPY | 150,000,000 | 1,169,909 | |||||
Mexico–4.66% | ||||||||
Mexican Bonos, Series M, Sr. Unsec. Bonds, 7.75%, 11/13/2042 | MXN | 17,500,000 | 946,544 | |||||
Petróleos Mexicanos, REGS, Sr. Unsec. Gtd. Medium-Term Euro Notes, 2.75%, 04/21/2027(b) | EUR | 400,000 | 451,257 | |||||
1,397,801 | ||||||||
Netherlands–3.95% | ||||||||
Achmea B.V., Series 1, Jr. Unsec. Sub. Medium-Term Euro Notes, 6.00%(e) | EUR | 500,000 | 633,444 | |||||
Coöperatieve Rabobank U.A., REGS, Jr. Unsec. Sub. Euro Bonds, 5.50%(b)(e) | EUR | 200,000 | 261,857 | |||||
Rabobank Capital Funding Trust IV, REGS, Jr. Unsec. Sub. Gtd. Euro Bonds, 5.56%(b)(e) | GBP | 200,000 | 288,607 | |||||
1,183,908 | ||||||||
Peru–0.80% | ||||||||
Peru Government Bond, REGS, Sr. Unsec. Bonds, 6.15%, 08/12/2032(b) | PEN | 737,000 | 238,389 | |||||
Russia–1.00% | ||||||||
Russian Federal Bond — OFZ, Series 6218, Unsec. Bonds, 8.50%, 09/17/2031 | RUB | 17,000,000 | 298,359 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
5 Invesco World Bond Fund
Principal Amount | Value | |||||||
Senegal–1.20% | ||||||||
Senegal Government International Bond, Sr. Unsec. Bonds, 4.75%, 03/13/2028(b) | EUR | 300,000 | $ | 360,024 | ||||
South Africa–2.08% | ||||||||
Republic of South Africa Government Bond, Unsec. Bonds, 8.75%, 02/28/2048 | ZAR | 8,000,000 | 622,393 | |||||
Switzerland–0.90% | ||||||||
UBS Group AG, REGS, Jr. Unsec. Sub. Euro Bonds, 5.75%(b)(e) | EUR | 200,000 | 270,880 | |||||
United Kingdom–4.16% | ||||||||
Coventry Building Society (The), REGS, Jr. Unsec. Sub. Euro Bonds, | GBP | 280,000 | 401,106 | |||||
Direct Line Insurance Group PLC, REGS, Unsec. Gtd. Sub. Euro Notes, 9.25%, 04/27/2042(b) | GBP | 100,000 | 172,169 | |||||
Nationwide Building Society, REGS, Jr. Unsec. Sub. Medium-Term Euro Notes, 6.88%(b)(e) | GBP | 200,000 | 287,955 | |||||
NGG Finance PLC, REGS, Unsec. Gtd. Sub. Euro Notes, 5.63%, 06/18/2073(b) | GBP | 250,000 | 384,432 | |||||
1,245,662 | ||||||||
United States–6.40% | ||||||||
Apple Inc., REGS, Sr. Unsec. Medium-Term Notes, 3.70%, 08/28/2022(b) | AUD | 1,100,000 | 853,635 | |||||
Goldman Sachs Group, Inc. (The), REGS, Sr. Unsec. Medium-Term DIP Notes, 5.00%, 08/08/2018(b) | AUD | 600,000 | 454,764 | |||||
MPT Operating Partnership, L.P./ MPT Finance Corp., Sr. Unsec. Gtd. Euro Bonds, 3.33%, 03/24/2025 | EUR | 100,000 | 124,045 | |||||
Netflix, Inc., REGS, Sr. Unsec. Euro Notes, 3.63%, 05/15/2027(b) | EUR | 200,000 | 240,656 | |||||
Verizon Communications Inc., Sr. Unsec. Euro Notes, 2.88%, 01/15/2038 | EUR | 200,000 | 243,988 | |||||
1,917,088 | ||||||||
Total Non U.S. Dollar Denominated Bonds & Notes |
| 13,859,048 | ||||||
U.S. Dollar Denominated Bonds & Notes –24.98% |
| |||||||
Bahrain–0.67% | ||||||||
CBB International Sukuk Co. | $ | 200,000 | 200,174 | |||||
Brazil–4.02% | ||||||||
Braskem Netherlands Finance B.V., Sr. Unsec. Gtd. Notes, 4.50%, 01/10/2028(b) | 398,000 | 373,623 | ||||||
Petrobras Global Finance B.V., Sr. Unsec. Gtd. Global Notes, 5.75%, 02/01/2029 | 424,000 | 403,012 |
Principal Amount | Value | |||||||
Brazil–(continued) | ||||||||
Vrio Finco 1, LLC/ Vrio Finco 2 Inc., Sr. Sec. Gtd. Notes, 6.88%, | $ | 428,000 | $ | 427,465 | ||||
1,204,100 | ||||||||
Cayman Islands–0.60% | ||||||||
SPARC EM SPC Panama Metro Line 2 S.P., Sr. Sec. Gtd. Notes, 0.00%, 12/05/2022(b)(d) | 200,000 | 179,000 | ||||||
Colombia–0.68% | ||||||||
Avianca Holdings S.A./ Avianca Leasing LLC/ Grupo Taca Holdings, REGS, Sr. Unsec. Gtd. Euro Notes, 8.38%, 05/10/2020(b) | 200,000 | 204,500 | ||||||
Ireland–0.94% | ||||||||
AerCap Global Aviation Trust, Jr. Unsec. Gtd. Sub. Notes, 6.50%, 06/15/2045(b) | 267,000 | 284,355 | ||||||
Lebanon–0.60% | ||||||||
Lebanon Government International Bond, REGS, Sr. Unsec. Euro Bonds, 7.25%, 03/23/2037(b) | 200,000 | 178,468 | ||||||
Mexico–3.15% | ||||||||
Mexico City Airport Trust, REGS, Sr. Sec. Euro Bonds, 5.50%, 07/31/2047(b) | 300,000 | 268,125 | ||||||
Petróleos Mexicanos, | ||||||||
Sr. Unsec. Gtd. Global Notes, | ||||||||
6.50%, 03/13/2027 | 233,000 | 240,980 | ||||||
Sr. Unsec. Gtd. Notes, | ||||||||
5.35%, 02/12/2028(b) | 156,000 | 149,198 | ||||||
SixSigma Networks México, S.A. de C.V., REGS, Sr. Unsec. Gtd. Euro Notes, 8.25%, 11/07/2021(b) | 89,000 | 92,783 | ||||||
Unifin Financiera, S.A.B. de C.V. SOFOM, E.N.R., Unsec. Sub. Notes, 8.88%(b)(e) | 200,000 | 193,000 | ||||||
944,086 | ||||||||
Netherlands–1.03% | ||||||||
ING Groep N.V., Jr. Unsec. Sub. Global Notes, 6.50%(e) | 300,000 | 309,540 | ||||||
Nigeria–1.36% | ||||||||
Nigeria Government International Bond, Sr. Unsec. Notes, | ||||||||
6.50%, 11/28/2027(b) | 200,000 | 201,840 | ||||||
7.14%, 02/23/2030(b) | 201,000 | 206,120 | ||||||
407,960 | ||||||||
Oman–1.31% | ||||||||
Oman Government International Bond, Sr. Unsec. Notes, 5.63%, 01/17/2028(b) | 200,000 | 191,387 | ||||||
Oztel Holdings SPC Ltd., | 206,000 | 201,237 | ||||||
392,624 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
6 Invesco World Bond Fund
Principal Amount | Value | |||||||
Pakistan–0.97% | ||||||||
Third Pakistan International Sukuk Co. Ltd. (The), Sr. Unsec. Notes, 5.63%, 12/05/2022(b) | $ | 300,000 | $ | 290,237 | ||||
Ukraine–0.82% | ||||||||
MHP Lux S.A., Sr. Unsec. Gtd. Notes, 6.95%, 04/03/2026(b) | 250,000 | 244,438 | ||||||
United Arab Emirates–0.66% | ||||||||
Abu Dhabi National Energy Co. PJSC, Sr. Unsec. Notes, 4.88%, 04/23/2030(b) | 200,000 | 198,626 | ||||||
United States–5.55% | ||||||||
Cantor Fitzgerald, L.P., Unsec. Notes, 6.50%, 06/17/2022(b) | 246,000 | 265,759 | ||||||
CVS Health Corp., Sr. Unsec. Global Notes, 4.78%, 03/25/2038 | 214,000 | 211,758 | ||||||
Energy Transfer Partners, L.P., Series B, Jr. Unsec. Sub. Global Notes, 6.63%(e) | 281,000 | 266,269 | ||||||
Enterprise Products Operating LLC, Series E, Jr. Unsec. Sub. Gtd. Deb., 5.25%, 08/16/2077 | 215,000 | 207,795 | ||||||
Mattel, Inc., Sr. Unsec. Global Notes, 5.45%, 11/01/2041 | 200,000 | 163,000 | ||||||
Plains All American Pipeline, L.P., Series B, Jr. Unsec. Sub. Notes, 6.13%(e) | 355,000 | 345,681 | ||||||
Southern Co. (The), Series B, Jr. Unsec. Sub. Global Notes, 5.50%, 03/15/2057 | 197,000 | 203,637 | ||||||
1,663,899 | ||||||||
Zambia–2.62% | ||||||||
First Quantum Minerals Ltd., Sr. Unsec. Gtd. Notes, | ||||||||
6.88%, 03/01/2026(b) | 300,000 | 285,750 | ||||||
7.50%, 04/01/2025(b) | 300,000 | 297,765 | ||||||
Zambia Government International Bond, REGS, Sr. Unsec. Euro Notes, 8.97%, 07/30/2027(b) | 200,000 | 201,450 | ||||||
784,965 | ||||||||
Total U.S. Dollar Denominated Bonds & Notes |
| 7,486,972 |
Principal Amount | Value | |||||||
U.S. Treasury Securities–15.33% |
| |||||||
U.S. Treasury Notes–12.40% | ||||||||
2.00%, 11/15/2026 | $ | 4,000,000 | $ | 3,715,703 | ||||
U.S. Treasury Bonds–2.93% | ||||||||
3.00%, 02/15/2048 | 900,000 | 880,032 | ||||||
Total U.S. Treasury Securities |
| 4,595,735 | ||||||
Shares | ||||||||
Preferred Stocks–1.51% |
| |||||||
Wells Fargo & Co., Class A, Series L, $75.00 Conv. Pfd. (Cost $454,493) | 353 | 452,055 | ||||||
Principal Amount | ||||||||
U.S. Government Sponsored Agency Mortgage-Backed Securities–0.30% |
| |||||||
United States–0.30% | ||||||||
Freddie Mac Multifamily Securitization, Series K038, Class X1, IO, Variable Rate Pass Through Ctfs., 1.33%, 03/25/2024 | $ | 1,636,487 | 91,493 | |||||
Shares | ||||||||
Money Market Funds–1.41% |
| |||||||
Invesco Government & Agency Portfolio–Institutional Class, | 147,688 | 147,688 | ||||||
Invesco Liquid Assets Portfolio–Institutional Class, 1.85%(g) | 105,369 | 105,380 | ||||||
Invesco Treasury Portfolio–Institutional Class, 1.62%(g) | 168,786 | 168,786 | ||||||
Total Money Market Funds |
| 421,854 | ||||||
Options Purchased–0.21% | ||||||||
(Cost $65,208)(h) | 62,246 | |||||||
TOTAL INVESTMENTS IN SECURITIES–89.98% |
| 26,969,403 | ||||||
OTHER ASSETS LESS LIABILITIES–10.02% |
| 3,003,353 | ||||||
NET ASSETS–100.00% |
| $ | 29,972,756 |
Investment Abbreviations:
ARS | – Argentine peso | |
AUD | – Australian Dollar | |
BADLAR | – Buenos Aires Deposits of Large Amounts Rate | |
BRL | – Brazilian Real | |
CAD | – Canadian Dollar | |
Conv. | – Convertible | |
Ctfs. | – Certificates | |
Deb. | – Debentures | |
DIP | – Debtor-in-Possession | |
DOP | – Dominican Peso | |
EUR | – Euro | |
GBP | – British Pound Sterling | |
Gtd. | – Guaranteed | |
IDR | – Indonesian Rupiah |
INR | – Indian Rupee | |
IO | – Interest Only | |
JPY | – Japanese Yen | |
Jr. | – Junior | |
MXN | – Mexican Peso | |
PEN | – Peru Nuevo Sol | |
Pfd. | – Preferred | |
REGS | – Regulation S | |
RUB | – Russian Ruble | |
Sec. | – Secured | |
Sr. | – Senior | |
Sub. | – Subordinated | |
Unsec. | – Unsecured | |
ZAR | – South African Rand |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
7 Invesco World Bond Fund
Notes to Schedule of Investments:
(a) | Foreign denominated security. Principal amount is denominated in the currency indicated. |
(b) | Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at April 30, 2018 was $12,905,204, which represented 43.06% of the Fund’s Net Assets. |
(c) | Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on April 30, 2018. |
(d) | Zero coupon bond issued at a discount. |
(e) | Perpetual bond with no specified maturity date. |
(f) | Interest rate is redetermined periodically based on the cash flows generated by the pool of assets backing the security, less any applicable fees. The rate shown is the rate in effect on April 30, 2018. |
(g) | The money market fund and the Fund are affiliated by having the same investment adviser. The rate shown is the 7-day SEC standardized yield as of April 30, 2018. |
(h) | The table below details options purchased. See Note1M and 1N. |
Open Over-The-Counter Foreign Currency Options Purchased | ||||||||||||||||||||||||||||||
Description | Type of Contract | Counterparty | Expiration Date | Exercise Price | Notional Value | Value | ||||||||||||||||||||||||
JPY versus EUR | Call | Goldman Sachs International | 06/27/2018 | JPY | 140.00 | EUR | 1,100,000 | $ | 368 | |||||||||||||||||||||
USD versus MXN | Put | Citibank, N.A. | 07/17/2018 | MXN | 18.50 | USD | 1,000,000 | 13,969 | ||||||||||||||||||||||
Subtotal Foreign Currency Options Purchased — Currency Risk | $ | 14,337 |
Open Over-The-Counter Interest Rate Swaptions Purchased — Interest Rate Risk | ||||||||||||||||||||||||||||||||||
Description | Type of Contract | Counterparty | Exercise Rate | Pay/ Exercise | Floating Rate Index | Payment Frequency | Expiration Date | Notional Value | Value | |||||||||||||||||||||||||
7 Year Interest Rate Swap | Put | Citibank, N.A. | 2.86 | % | Pay | 3 Month USD LIBOR | Quarterly | 07/19/2025 | $ | 4,800,000 | $ | 47,909 | ||||||||||||||||||||||
Total Options Purchased (Cost $65,208) | $ | 62,246 |
Open Over-The-Counter Foreign Currency Options Written | ||||||||||||||||||||||||||||||||||||||
Description | Type of Contract | Counterparty | Expiration Date | Exercise Price | Premiums Received | Notional Value | Value | Unrealized Appreciation | ||||||||||||||||||||||||||||||
MXN versus USD | Call | Citibank, N.A. | 07/17/2018 | MXN | 22.00 | $ | (22,595 | ) | USD | 1,000,000 | $ | (1,280 | ) | $ | 21,315 |
Open Forward Foreign Currency Contracts | ||||||||||||||||||||||
Contract to | Unrealized Appreciation (Depreciation) | |||||||||||||||||||||
Settlement Date | Counterparty | Deliver | Receive | |||||||||||||||||||
05/03/2018 | Barclays Bank PLC | BRL | 500,000 | USD | 143,633 | $ | 964 | |||||||||||||||
05/31/2018 | Barclays Bank PLC | CHF | 430,000 | USD | 460,306 | 25,216 | ||||||||||||||||
05/31/2018 | Barclays Bank PLC | EUR | 250,000 | USD | 310,222 | 7,595 | ||||||||||||||||
05/31/2018 | Barclays Bank PLC | GBP | 510,000 | USD | 711,34 | 8,244 | ||||||||||||||||
05/31/2018 | Barclays Bank PLC | JPY | 70,000,000 | USD | 658,215 | 16,488 | ||||||||||||||||
05/31/2018 | Barclays Bank PLC | RUB | 18,000,000 | USD | 290,839 | 6,104 | ||||||||||||||||
05/31/2018 | Barclays Bank PLC | TRY | 1,000,000 | USD | 253,965 | 10,335 | ||||||||||||||||
05/31/2018 | Barclays Bank PLC | USD | 339,364 | MXN | 6,500,000 | 6,554 | ||||||||||||||||
05/31/2018 | CIBC World Markets Corp. | CAD | 350,000 | USD | 275,374 | 2,556 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | AUD | 400,000 | USD | 307,955 | 6,857 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | CLP | 370,000,000 | USD | 610,863 | 7,968 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | HUF | 166,000,000 | USD | 658,211 | 17,975 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | IDR | 10,000,000,000 | USD | 721,917 | 6,471 | ||||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | JPY | 200,000,000 | USD | 1,880,085 | 46,579 | ||||||||||||||||
05/03/2018 | Goldman Sachs International | BRL | 1,270,000 | USD | 378,813 | 16,433 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | CLP | 150,000,000 | USD | 247,117 | 2,700 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | EUR | 400,000 | USD | 493,954 | 9,752 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | MYR | 1,000,000 | USD | 257,136 | 4,076 | ||||||||||||||||
06/01/2018 | Goldman Sachs International | PLN | 1,100,000 | USD | 322,162 | 8,604 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | RUB | 20,000,000 | USD | 346,254 | 29,882 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | SEK | 4,000,000 | USD | 476,211 | 18,290 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 346,741 | COP | 1,000,000,000 | 9,943 | ||||||||||||||||
05/31/2018 | Goldman Sachs International | ZAR | 7,900,000 | USD | 641,819 | 10,929 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
8 Invesco World Bond Fund
Open Forward Foreign Currency Contracts—(continued) | ||||||||||||||||||||||
Contract to | Unrealized Appreciation (Depreciation) | |||||||||||||||||||||
Settlement Date | Counterparty | Deliver | Receive | |||||||||||||||||||
05/31/2018 | JPMorgan Chase & Co. | AUD | 2,170,000 | USD | 1,705,012 | $ | 71,554 | |||||||||||||||
05/31/2018 | JPMorgan Chase & Co. | GBP | 600,000 | USD | 843,743 | 16,508 | ||||||||||||||||
05/03/2018 | Merrill Lynch International | BRL | 1,020,000 | USD | 297,570 | 8,115 | ||||||||||||||||
06/04/2018 | Merrill Lynch International | BRL | 790,000 | USD | 227,230 | 963 | ||||||||||||||||
05/31/2018 | Merrill Lynch International | INR | 30,000,000 | USD | 457,945 | 8,264 | ||||||||||||||||
05/31/2018 | Merrill Lynch International | THB | 20,000,000 | USD | 635,122 | 1,385 | ||||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 400,695 | COP | 1,140,000,000 | 5,924 | ||||||||||||||||
05/31/2018 | Merrill Lynch International | ZAR | 3,900,000 | USD | 324,755 | 13,303 | ||||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | CLP | 230,000,000 | USD | 381,489 | 6,717 | ||||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | CZK | 17,000,000 | USD | 824,242 | 20,792 | ||||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | EUR | 250,000 | USD | 305,978 | 3,352 | ||||||||||||||||
06/01/2018 | Morgan Stanley & Co. LLC | PLN | 5,230,000 | USD | 1,533,525 | 42,703 | ||||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | SEK | 1,300,000 | USD | 158,427 | 9,603 | ||||||||||||||||
Subtotal — Appreciation |
| 489,698 | ||||||||||||||||||||
05/31/2018 | Barclays Bank PLC | MXN | 36,000,000 | USD | 1,903,862 | (11,996 | ) | |||||||||||||||
05/31/2018 | Barclays Bank PLC | USD | 143,864 | BRL | 500,000 | (1,195 | ) | |||||||||||||||
05/31/2018 | Barclays Bank PLC | USD | 396,182 | GBP | 280,000 | (10,139 | ) | |||||||||||||||
05/31/2018 | Barclays Bank PLC | USD | 1,008,014 | CLP | 600,000,000 | (30,346 | ) | |||||||||||||||
05/31/2018 | Barclays Bank PLC | USD | 662,853 | RUB | 38,000,000 | (61,746 | ) | |||||||||||||||
05/31/2018 | CIBC World Markets Corp. | USD | 279,035 | CAD | 350,000 | (6,217 | ) | |||||||||||||||
05/31/2018 | Citibank, N.A. | USD | 373,821 | KRW | 400,000,000 | (124 | ) | |||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | USD | 829,106 | CZK | 17,000,000 | (25,656 | ) | |||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | USD | 408,616 | EUR | 330,000 | (9,149 | ) | |||||||||||||||
05/31/2018 | Deutsche Bank Securities Inc. | USD | 5,468,360 | JPY | 584,611,320 | (108,920 | ) | |||||||||||||||
06/01/2018 | Deutsche Bank Securities Inc. | USD | 633,487 | PLN | 2,130,000 | (26,326 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | TRY | 1,400,000 | USD | 340,909 | (173 | ) | |||||||||||||||
05/03/2018 | Goldman Sachs International | USD | 364,827 | BRL | 1,270,000 | (2,447 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 332,613 | CLP | 200,000,000 | (6,723 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 1,882,635 | EUR | 1,519,959 | (42,717 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 663,782 | HUF | 166,000,000 | (23,547 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 254,712 | MYR | 1,000,000 | (1,653 | ) | |||||||||||||||
06/01/2018 | Goldman Sachs International | USD | 1,238,651 | PLN | 4,200,000 | (41,432 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 480,863 | SEK | 4,000,000 | (22,942 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 344,460 | TRY | 1,400,000 | (3,377 | ) | |||||||||||||||
05/31/2018 | Goldman Sachs International | USD | 325,370 | ZAR | 3,900,000 | (13,917 | ) | |||||||||||||||
05/31/2018 | JPMorgan Chase & Co. | USD | 309,590 | AUD | 400,000 | (8,492 | ) | |||||||||||||||
05/31/2018 | JPMorgan Chase & Co. | USD | 749,009 | EUR | 600,000 | (22,706 | ) | |||||||||||||||
05/31/2018 | JPMorgan Chase & Co. | USD | 167,482 | GBP | 120,000 | (2,035 | ) | |||||||||||||||
05/03/2018 | Merrill Lynch International | USD | 673,505 | BRL | 2,330,000 | (8,666 | ) | |||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 168,279 | CLP | 100,000,000 | (5,335 | ) | |||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 479,707 | JPY | 50,000,000 | (21,331 | ) | |||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 643,915 | THB | 20,000,000 | (10,177 | ) | |||||||||||||||
05/31/2018 | Merrill Lynch International | USD | 256,405 | TRY | 1,000,000 | (12,775 | ) | |||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | USD | 662,543 | JPY | 70,000,000 | (20,816 | ) | |||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | USD | 319,321 | MXN | 6,000,000 | (11 | ) | |||||||||||||||
06/01/2018 | Morgan Stanley & Co. LLC | USD | 287,190 | PLN | 1,000,000 | (2,138 | ) | |||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | USD | 160,733 | RUB | 10,000,000 | (2,547 | ) | |||||||||||||||
05/31/2018 | Morgan Stanley & Co. LLC | USD | 159,462 | SEK | 1,300,000 | (10,638 | ) | |||||||||||||||
05/31/2018 | RBC Capital Markets Corp. | USD | 205,846 | CAD | 260,000 | (3,181 | ) | |||||||||||||||
Subtotal — Depreciation |
| (581,590 | ) | |||||||||||||||||||
Total Open Forward Foreign Currency Contracts — Currency Risk |
| $ | (91,892 | ) |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
9 Invesco World Bond Fund
Open Over-The-Counter Interest Rate Swap Agreements — Interest Rate Risk | ||||||||||||||||||||||||||||||||||||||
Counterparty | Pay/ Receive Floating Rate | Floating Rate Index | Payment Frequency | (Pay)/ Receive Fixed Rate | Payment Frequency | Maturity Date | Notional Value | Upfront Payments Paid (Received) | Value | Unrealized Appreciation | ||||||||||||||||||||||||||||
Citibank, N.A. | Pay | | CFETS 7-Day CNY Fixing Repo Rates |
| Quarterly | 3.91 | % | Quarterly | 03/05/2023 | CNY 3,800,000 | $ | — | $ | 8,222 | $ | 8,222 |
Currency Abbreviations:
AUD | – Australian Dollar | |
BRL | – Brazilian Real | |
CAD | – Canadian Dollar | |
CHF | – Swiss Franc | |
CLP | – Chilean Peso | |
CNY | – Chinese Yuan | |
COP | – Colombian Peso | |
CZK | – Czech Koruna | |
EUR | – Euro | |
GBP | – British Pound Sterling | |
HUF | – Hungarian Forint | |
IDR | – Indonesian Rupiah | |
INR | – Indian Rupee | |
JPY | – Japanese Yen | |
KRW | – South Korean Won | |
MXN | – Mexican Peso | |
MYR | – Malaysian Ringgit | |
PLN | – Polish Zloty | |
RUB | – Russian Ruble | |
SEK | – Swedish Krona | |
THB | – Thai Baht | |
TRY | – Turkish Lira | |
USD | – U.S. Dollar | |
ZAR | – South African Rand |
Portfolio Composition
By sector, based on Net Assets
as of April 30, 2018
Sovereign Debt | 31.3 | % | ||
U.S. Treasury Securities | 15.4 | |||
Financials | 14.8 | |||
Energy | 7.7 | |||
Consumer Discretionary | 3.9 | |||
Materials | 3.2 | |||
Information Technology | 2.9 | |||
Telecommunication Services | 2.8 | |||
Utilities | 2.6 | |||
Other Sectors, Each Less than 2% | 4.0 | |||
Money Market Funds Plus Other Assets Less Liabilities | 11.4 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
10 Invesco World Bond Fund
Statement of Assets and Liabilities
April 30, 2018
(Unaudited)
Assets: | ||||
Investments in securities, at value (Cost $26,318,398) | $ | 26,547,549 | ||
Investments in affiliated money market funds, at value | 421,854 | |||
Other investments: | ||||
Swaps receivable — OTC | 3,664 | |||
Unrealized appreciation on forward foreign currency contracts outstanding | 489,698 | |||
Unrealized appreciation on swap agreements — OTC | 8,222 | |||
Deposits with brokers: | ||||
Cash collateral — centrally cleared swap agreements | 125,000 | |||
Cash | 330,321 | |||
Foreign currencies, at value (Cost $2,436,763) | 2,396,599 | |||
Receivable for: | ||||
Fund shares sold | 55,661 | |||
Dividends and interest | 353,345 | |||
Investment for trustee deferred compensation and retirement plans | 40,719 | |||
Other assets | 46,237 | |||
Total assets | 30,818,869 | |||
Liabilities: | ||||
Other investments: | ||||
Options written, at value (premiums received $22,595) | 1,280 | |||
Swaps payable — OTC | 3,092 | |||
Unrealized depreciation on forward foreign currency contracts outstanding | 581,590 | |||
Payable for: | ||||
Investments purchased | 120,770 | |||
Fund shares reacquired | 17,122 | |||
Accrued fees to affiliates | 21,876 | |||
Accrued trustees’ and officers’ fees and benefits | 1,500 | |||
Accrued other operating expenses | 56,063 | |||
Trustee deferred compensation and retirement plans | 42,820 | |||
Total liabilities | 846,113 | |||
Net assets applicable to shares outstanding | $ | 29,972,756 | ||
Net assets consist of: | ||||
Shares of beneficial interest | $ | 30,744,289 | ||
Undistributed net investment income | 142,634 | |||
Undistributed net realized gain (loss) | (1,041,477 | ) | ||
Net unrealized appreciation | 127,310 | |||
$ | 29,972,756 |
Net Assets: | ||||
Class A | $ | 21,657,408 | ||
Class C | $ | 4,292,678 | ||
Class Y | $ | 3,958,599 | ||
Class R5 | $ | 834 | ||
Class R6 | $ | 63,237 | ||
Shares outstanding, no par value, |
| |||
Class A | 2,098,909 | |||
Class C | 416,699 | |||
Class Y | 383,958 | |||
Class R5 | 81 | |||
Class R6 | 6,127 | |||
Class A: | ||||
Net asset value per share | $ | 10.32 | ||
Maximum offering price per share | ||||
(Net asset value of $10.32 ¸ 95.75%) | $ | 10.78 | ||
Class C: | ||||
Net asset value and offering price per share | $ | 10.30 | ||
Class Y: | ||||
Net asset value and offering price per share | $ | 10.31 | ||
Class R5: | ||||
Net asset value and offering price per share | $ | 10.30 | ||
Class R6: | ||||
Net asset value and offering price per share | $ | 10.32 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco World Bond Fund
Statement of Operations
For the six months ended April 30, 2018
(Unaudited)
Investment income: | ||||
Interest (net of foreign withholding taxes of $5,775) | $ | 629,851 | ||
Dividends | 6,619 | |||
Dividends from affiliated money market funds | 12,400 | |||
Total investment income | 648,870 | |||
Expenses: | ||||
Advisory fees | 102,248 | |||
Administrative services fees | 24,794 | |||
Custodian fees | 15,528 | |||
Distribution fees: | ||||
Class A | 27,698 | |||
Class B | 488 | |||
Class C | 20,942 | |||
Transfer agent fees — A, B, C, Y | 43,375 | |||
Transfer agent fees — R6 | 20 | |||
Trustees’ and officers’ fees and benefits | 10,778 | |||
Registration and filing fees | 42,148 | |||
Reports to shareholders | 12,471 | |||
Professional services fees | 34,148 | |||
Other | 12,000 | |||
Total expenses | 346,638 | |||
Less: Fees waived and expenses reimbursed | (190,011 | ) | ||
Net expenses | 156,627 | |||
Net investment income | 492,243 | |||
Realized and unrealized gain (loss) from: | ||||
Net realized gain (loss) from: | ||||
Investment securities | 347,715 | |||
Foreign currencies | 68,179 | |||
Forward foreign currency contracts | (147,693 | ) | ||
Futures contracts | 48,100 | |||
Option contracts written | (5,597 | ) | ||
Swap agreements | (209,007 | ) | ||
101,697 | ||||
Change in net unrealized appreciation (depreciation) of: | ||||
Investment securities | (736,395 | ) | ||
Foreign currencies | (20,965 | ) | ||
Forward foreign currency contracts | 86,012 | |||
Futures contracts | 41,251 | |||
Option contracts written | 20,752 | |||
Swap agreements | 98,256 | |||
(511,089 | ) | |||
Net realized and unrealized gain (loss) | (409,392 | ) | ||
Net increase in net assets resulting from operations | $ | 82,851 |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
12 Invesco World Bond Fund
Statement of Changes in Net Assets
For the six months ended April 30, 2018 and the year ended October 31, 2017
(Unaudited)
April 30, 2018 | October 31, 2017 | |||||||
Operations: | ||||||||
Net investment income | $ | 492,243 | $ | 1,120,225 | ||||
Net realized gain (loss) | 101,697 | (1,845,787 | ) | |||||
Change in net unrealized appreciation (depreciation) | (511,089 | ) | 1,159,852 | |||||
Net increase in net assets resulting from operations | 82,851 | 434,290 | ||||||
Distributions to shareholders from net investment income: | ||||||||
Class A | (287,830 | ) | (87,346 | ) | ||||
Class B | (942 | ) | (1,299 | ) | ||||
Class C | (38,562 | ) | (15,969 | ) | ||||
Class Y | (69,539 | ) | (27,636 | ) | ||||
Class R5 | (12 | ) | (3 | ) | ||||
Class R6 | (900 | ) | (39 | ) | ||||
Total distributions from net investment income | (397,785 | ) | (132,292 | ) | ||||
Return of capital: | ||||||||
Class A | — | (536,224 | ) | |||||
Class B | — | (5,196 | ) | |||||
Class C | — | (63,221 | ) | |||||
Class Y | — | (188,272 | ) | |||||
Class R5 | — | (22 | ) | |||||
Class R6 | — | (272 | ) | |||||
Total return of capital | — | (793,207 | ) | |||||
Share transactions–net: | ||||||||
Class A | (251,286 | ) | (6,443,931 | ) | ||||
Class B | (222,690 | ) | (243,332 | ) | ||||
Class C | 194,593 | (935,714 | ) | |||||
Class Y | (1,808,720 | ) | (4,540,530 | ) | ||||
Class R5 | — | 9 | ||||||
Class R6 | 53,101 | — | ||||||
Net increase (decrease) in net assets resulting from share transactions | (2,035,002 | ) | (12,163,498 | ) | ||||
Net increase (decrease) in net assets | (2,349,936 | ) | (12,654,707 | ) | ||||
Net assets: | ||||||||
Beginning of period | 32,322,692 | 44,977,399 | ||||||
End of period (includes undistributed net investment income of $142,634 and $48,176, respectively) | $ | 29,972,756 | $ | 32,322,692 |
Notes to Financial Statements
April 30, 2018
(Unaudited)
NOTE 1—Significant Accounting Policies
Invesco World Bond Fund (the “Fund”) is a series portfolio of AIM Investment Funds (Invesco Investment Funds) (the “Trust”). The Trust is organized as a Delaware statutory trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end series management investment company authorized to issue an unlimited number of shares of beneficial interest. Information presented in these financial statements pertains only to the Fund. Matters affecting the Fund or each class will be voted on exclusively by the shareholders of the Fund or each class.
The Fund’s investment objective is total return, comprised of current income and capital appreciation.
The Fund currently consists of five different classes of shares: Class A, Class C, Class Y, Class R5 and Class R6. Class Y shares are available only to certain investors. Class A shares are sold with a front-end sales charge unless certain waiver criteria are met and under certain circumstances load waived shares may be subject to contingent deferred sales charges (“CDSC”). Class C shares are sold with a CDSC. Class Y, Class R5 and Class R6
13 Invesco World Bond Fund
shares are sold at net asset value. Effective November 30, 2010, new or additional investments in Class B shares are no longer permitted. Existing shareholders of Class B shares were permitted to continue to reinvest dividends and capital gains distributions in Class B shares until their conversion to Class A shares. Also, shareholders in Class B shares were able to exchange those shares for Class B shares of other Invesco Funds offering such shares until they converted to Class A shares. Generally, Class B shares automatically converted to Class A shares on or about the month-end, which was at least eight years after the date of purchase. Redemptions of Class B shares prior to the conversion date were subject to a CDSC. Effective January 26, 2018, all of the Fund’s outstanding Class B shares were converted to Class A shares, in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
A. | Security Valuations — Securities, including restricted securities, are valued according to the following policy. |
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
A security listed or traded on an exchange (except convertible securities) is valued at its last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued by an independent pricing service they may be considered fair valued. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
B. | Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income (net of withholding tax, if any) is |
14 Invesco World Bond Fund
recorded on the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s net asset value and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates income and realized and unrealized capital gains and losses to a class based on the relative net assets of each class.
C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
D. | Distributions — Distributions from net investment income, if any, are declared and paid monthly and are recorded on the ex-dividend date. Distributions from net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund’s taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
F. | Expenses — Fees provided for under the Rule 12b-1 plan of a particular class of the Fund are charged to the operations of such class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses attributable to Class R5 and Class R6 are allocated to each share class based on relative net assets. Sub-accounting fees attributable to Class R5 are charged to the operations of the class. Transfer agency fees and expenses and other shareholder recordkeeping fees and expenses relating to all other classes are allocated among those classes based on relative net assets. All other expenses are allocated among the classes based on relative net assets. |
G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund’s servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
I. | Treasury Inflation-Protected Securities — The Fund may invest in Treasury Inflation-Protected Securities (“TIPS”). TIPS are fixed income securities whose principal value is periodically adjusted to the rate of inflation. The principal value of TIPS will be adjusted upward or downward, and any increase or decrease in the principal amount of TIPS will be included as interest income in the Statement of Operations, even though investors do not receive their principal until maturity. |
J. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net |
15 Invesco World Bond Fund
unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
K. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
L. | Futures Contracts — The Fund may enter into futures contracts to manage exposure to interest rate, equity and market price movements and/or currency risks. A futures contract is an agreement between two parties (“Counterparties”) to purchase or sell a specified underlying security, currency or commodity (or delivery of a cash settlement price, in the case of an index future) for a fixed price at a future date. The Fund currently invests only in exchange-traded futures and they are standardized as to maturity date and underlying financial instrument. Initial margin deposits required upon entering into futures contracts are satisfied by the segregation of specific securities or cash as collateral at the futures commission merchant (broker). During the period the futures contracts are open, changes in the value of the contracts are recognized as unrealized gains or losses by recalculating the value of the contracts on a daily basis. Subsequent or variation margin payments are received or made depending upon whether unrealized gains or losses are incurred. These amounts are reflected as receivables or payables on the Statement of Assets and Liabilities. When the contracts are closed or expire, the Fund recognizes a realized gain or loss equal to the difference between the proceeds from, or cost of, the closing transaction and the Fund’s basis in the contract. The net realized gain (loss) and the change in unrealized gain (loss) on futures contracts held during the period is included on the Statement of Operations. The primary risks associated with futures contracts are market risk and the absence of a liquid secondary market. If the Fund were unable to liquidate a futures contract and/or enter into an offsetting closing transaction, the Fund would continue to be subject to market risk with respect to the value of the contracts and continue to be required to maintain the margin deposits on the futures contracts. Futures contracts have minimal Counterparty risk since the exchange’s clearinghouse, as Counterparty to all exchange-traded futures, guarantees the futures against default. Risks may exceed amounts recognized in the Statement of Assets and Liabilities. |
M. | Call Options Purchased and Written — The Fund may write call options and/or buy call options. A covered call option gives the purchaser of such option the right to buy, and the writer the obligation to sell, the underlying security or foreign currency at the stated exercise price during the option period. An uncovered call option exists without the ownership of the underlying security. Options written by the Fund normally will have expiration dates between three and nine months from the date written. The exercise price of a call option may be below, equal to, or above the current market value of the underlying security at the time the option is written. |
Additionally, the Fund may enter into an option on a swap agreement, also called a “swaption”. A swaption is an option that gives the buyer the right, but not the obligation, to enter into a swap on a future date in exchange for paying a market-based premium. A receiver swaption gives the owner the right to receive the total return of a specified asset, reference rate or index. Swaptions also include options that allow an existing swap to be terminated or extended by one of the Counterparties.
When the Fund writes a covered call option, an amount equal to the premium received by the Fund is recorded as an asset and an equivalent liability in the Statement of Assets and Liabilities. The amount of the liability is subsequently “marked-to-market” to reflect the current market value of the option written. If a written covered call option expires on the stipulated expiration date, or if the Fund enters into a closing purchase transaction, the Fund realizes a gain (or a loss if the closing purchase transaction exceeds the premium received when the option was written) without regard to any unrealized gain or loss on the underlying security, and the liability related to such option is extinguished. If a written covered call option is exercised, the Fund realizes a gain or a loss from the sale of the underlying security and the proceeds of the sale are increased by the premium originally received. Realized and unrealized gains and losses on call options written are included in the Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Option contracts written. A risk in writing a covered call option is that the Fund gives up the opportunity for profit if the market price of the security increases and the option is exercised. The risk in writing an uncovered call option is that the Fund may incur significant losses if the value of the written security exceeds the exercise price of the option.
When the Fund buys a call option, an amount equal to the premium paid by the Fund is recorded as an investment on the Statement of Assets and Liabilities. The amount of the investment is subsequently “marked-to-market” to reflect the current value of the option purchased. Realized and unrealized gains and losses on call options purchased are included in the Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Investment securities. A risk in buying an option is that the Fund pays a premium whether or not the option is exercised. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased.
N. | Put Options Purchased and Written — The Fund may purchase and write put options including options on securities indexes, or foreign currency and/or futures contracts. By purchasing a put option, the Fund obtains the right (but not the obligation) to sell the option’s underlying instrument at a fixed strike price. In return for this right, the Fund pays an option premium. The option’s underlying instrument may be a security, securities index, or a futures contract. |
16 Invesco World Bond Fund
Additionally, the Fund may enter into an option on a swap agreement, also called a “swaption”. A swaption is an option that gives the buyer the right, but not the obligation, to enter into a swap on a future date in exchange for paying a market-based premium. A receiver swaption gives the owner the right to receive the total return of a specified asset, reference rate or index. Swaptions also include options that allow an existing swap to be terminated or extended by one of the Counterparties.
Put options may be used by the Fund to hedge securities it owns by locking in a minimum price at which the Fund can sell. If security prices fall, the put option could be exercised to offset all or a portion of the Fund’s resulting losses. At the same time, because the maximum the Fund has at risk is the cost of the option, purchasing put options does not eliminate the potential for the Fund to profit from an increase in the value of the underlying portfolio securities. The Fund may write put options to earn additional income in the form of option premiums if it expects the price of the underlying instrument to remain stable or rise during the option period so that the option will not be exercised. The risk in this strategy is that the price of the underlying securities may decline by an amount greater than the premium received. Put options written are reported as a liability in the Statement of Assets and Liabilities. Realized and unrealized gains and losses on put options purchased and put options written are included in the Statement of Operations as Net realized gain (loss) from and Change in net unrealized appreciation (depreciation) of Investment securities and Option contracts written, respectively. A risk in buying an option is that the Fund pays a premium whether or not the option is exercised. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased.
O. | Swap Agreements — The Fund may enter into various swap transactions, including interest rate, total return, index, currency and credit default swap contracts (“CDS”) for investment purposes or to manage interest rate, currency or credit risk. Such transactions are agreements between two parties (“Counterparties”). A swap agreement may be negotiated bilaterally and traded over-the-counter (“OTC”) between two parties (“uncleared/OTC”) or, in some instances, must be transacted through a future commission merchant (“FCM”) and cleared through a clearinghouse that serves as a central Counterparty (“centrally cleared swap”). These agreements may contain among other conditions, events of default and termination events, and various covenants and representations such as provisions that require the Fund to maintain a pre-determined level of net assets, and/or provide limits regarding the decline of the Fund’s NAV over specific periods of time. If the Fund were to trigger such provisions and have open derivative positions at that time, the Counterparty may be able to terminate such agreement and request immediate payment in an amount equal to the net liability positions, if any. |
Interest rate, total return, index, and currency swap agreements are two-party contracts entered into primarily to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a notional amount, i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate or return of an underlying asset, in a particular foreign currency, or in a “basket” of securities representing a particular index.
In a centrally cleared swap, the Fund’s ultimate Counterparty is a central clearinghouse. The Fund initially will enter into centrally cleared swaps through an executing broker. When a fund enters into a centrally cleared swap, it must deliver to the central Counterparty (via the FCM) an amount referred to as “initial margin.” Initial margin requirements are determined by the central Counterparty, but an FCM may require additional initial margin above the amount required by the central Counterparty. Initial margin deposits required upon entering into centrally cleared swaps are satisfied by cash or securities as collateral at the FCM. Securities deposited as initial margin are designated on the Schedule of Investments and cash deposited is recorded on the Statement of Assets and Liabilities. During the term of a cleared swap agreement, a “variation margin” amount may be required to be paid by the Fund or may be received by the Fund, based on the daily change in price of the underlying reference instrument subject to the swap agreement and is recorded as a receivable or payable for variation margin in the Statement of Assets and Liabilities until the centrally cleared swap is terminated at which time a realized gain or loss is recorded.
A CDS is an agreement between Counterparties to exchange the credit risk of an issuer. A buyer of a CDS is said to buy protection by paying a fixed payment over the life of the agreement and in some situations an upfront payment to the seller of the CDS. If a defined credit event occurs (such as payment default or bankruptcy), the Fund as a protection buyer would cease paying its fixed payment, the Fund would deliver eligible bonds issued by the reference entity to the seller, and the seller would pay the full notional value, or the “par value”, of the referenced obligation to the Fund. A seller of a CDS is said to sell protection and thus would receive a fixed payment over the life of the agreement and an upfront payment, if applicable. If a credit event occurs, the Fund as a protection seller would cease to receive the fixed payment stream, the Fund would pay the buyer “par value” or the full notional value of the referenced obligation, and the Fund would receive the eligible bonds issued by the reference entity. In turn, these bonds may be sold in order to realize a recovery value. Alternatively, the seller of the CDS and its Counterparty may agree to net the notional amount and the market value of the bonds and make a cash payment equal to the difference to the buyer of protection. If no credit event occurs, the Fund receives the fixed payment over the life of the agreement. As the seller, the Fund would effectively add leverage to its portfolio because, in addition to its total net assets, the Fund would be subject to investment exposure on the notional amount of the CDS. In connection with these agreements, cash and securities may be identified as collateral in accordance with the terms of the respective swap agreements to provide assets of value and recourse in the event of default under the swap agreement or bankruptcy/insolvency of a party to the swap agreement. If a Counterparty becomes bankrupt or otherwise fails to perform its obligations due to financial difficulties, the Fund may experience significant delays in obtaining any recovery in a bankruptcy or other reorganization proceeding. The Fund may obtain only limited recovery or may obtain no recovery in such circumstances. The Fund’s maximum risk of loss from Counterparty risk, either as the protection seller or as the protection buyer, is the value of the contract. The risk may be mitigated by having a master netting arrangement between the Fund and the Counterparty and by the designation of collateral by the Counterparty to cover the Fund’s exposure to the Counterparty.
Implied credit spreads represent the current level at which protection could be bought or sold given the terms of the existing CDS contract and serve as an indicator of the current status of the payment/performance risk of the CDS. An implied spread that has widened or increased since entry into the initial contract may indicate a deteriorating credit profile and increased risk of default for the reference entity. A declining or narrowing spread may indicate an improving credit profile or decreased risk of default for the reference entity. Alternatively, credit spreads may increase or decrease reflecting the general tolerance for risk in the credit markets.
An interest rate swap is an agreement between Counterparties pursuant to which the parties exchange a floating rate payment for a fixed rate payment based on a specified notional amount.
Changes in the value of centrally cleared and OTC swap agreements are recognized as unrealized gains (losses) in the Statement of Operations by “marking to market” on a daily basis to reflect the value of the swap agreement at the end of each trading day. Payments received or paid at the beginning of the agreement are reflected as such on the Statement of Assets and Liabilities and may be referred to as upfront payments. The Fund
17 Invesco World Bond Fund
accrues for the fixed payment stream and amortizes upfront payments, if any, on swap agreements on a daily basis with the net amount, recorded as a component of realized gain (loss) on the Statement of Operations. A liquidation payment received or made at the termination of a swap agreement is recorded as realized gain (loss) on the Statement of Operations. The Fund segregates cash or liquid securities having a value at least equal to the amount of the potential obligation of a Fund under any swap transaction. Cash held as collateral is recorded as deposits with brokers on the Statement of Assets and Liabilities. Entering into these agreements involves, to varying degrees, lack of liquidity and elements of credit, market, and Counterparty risk in excess of amounts recognized on the Statement of Assets and Liabilities. Such risks involve the possibility that a swap is difficult to sell or liquidate; the Counterparty does not honor its obligations under the agreement and unfavorable interest rates and market fluctuations. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. A short position in a security poses more risk than holding the same security long. As there is no limit on how much the price of the security can increase, the Fund’s exposure is unlimited.
Notional amounts of each individual credit default swap agreement outstanding as of April 30, 2018 for which the Fund is the seller of protection are disclosed in the open swap agreements table. These potential amounts would be partially offset by any recovery values of the respective referenced obligations, upfront payments received upon entering into the agreement, or net amounts received from the settlement of buy protection credit default swap agreements entered into by the Fund for the same referenced entity or entities.
P. | Leverage Risk — Leverage exists when the Fund can lose more than it originally invests because it purchases or sells an instrument or enters into a transaction without investing an amount equal to the full economic exposure of the instrument or transaction. |
Q. | Collateral — To the extent the Fund has designated or segregated a security as collateral and that security is subsequently sold, it is the Fund’s practice to replace such collateral no later than the next business day. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund’s average daily net assets as follows:
Average Daily Net Assets | Rate | |||||||
First $250 million | 0 | .65% | ||||||
Next $250 million | 0 | .59% | ||||||
Next $500 million | 0 | .565% | ||||||
Next $1.5 billion | 0 | .54% | ||||||
Next $2.5 billion | 0 | .515% | ||||||
Next $5 billion | 0 | .49% | ||||||
Over $10 billion | 0 | .465% |
For the six months ended April 30, 2018, the effective advisory fees incurred by the Fund was 0.65%.
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Adviser has contractually agreed, through at least February 28, 2019, to waive advisory fees and/or reimburse expenses to the extent necessary to limit total annual fund operating expenses after fee waiver and/or expense reimbursement (excluding certain items discussed below) of Class A, Class C, Class Y, Class R5 and Class R6 shares to 0.94%, 1.69%, 0.69%, 0.69% and 0.69%, respectively, of the Fund’s average daily net assets (the “expense limits”). Prior to their conversion to Class A shares, the expense limit for Class B was 1.69% of average daily net assets. In determining the Adviser’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause total annual fund operating expenses after fee waiver and/or expense reimbursement to exceed the numbers reflected above: (1) interest; (2) taxes; (3) dividend expense on short sales; (4) extraordinary or non-routine items, including litigation expenses; and (5) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless Invesco continues the fee waiver agreement, it will terminate on February 28, 2019. During its term, the fee waiver agreement cannot be terminated or amended to increase the expense limits or reduce the advisory fee waiver without approval of the Board of Trustees. To the extent that the annualized expense ratio does not exceed the expense limits, the Adviser will retain its ability to be reimbursed for such fee waivers or reimbursements prior to the end of each fiscal year.
Further, the Adviser has contractually agreed, through at least June 30, 2020, to waive the advisory fee payable by the Fund in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Fund of uninvested cash in such affiliated money market funds.
For the six months ended April 30, 2018, the Adviser waived advisory fees and reimbursed fund level expenses of $146,616 and reimbursed class level expenses of $30,609, $135, $5,786, $6,845 and $20 of Class A, Class B, Class C, Class Y and Class R6 shares, respectively.
The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Fund. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Administrative services fees.
The Trust has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. IIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. All fees payable by IIS to intermediaries that provide omnibus account services or sub-accounting services are charged back to the Fund, subject to certain limitations approved by the Trust’s Board of Trustees. For the six months ended April 30, 2018, expenses incurred under the agreement are shown in the Statement of Operations as Transfer agent fees.
18 Invesco World Bond Fund
The Trust has entered into master distribution agreements with Invesco Distributors, Inc. (“IDI”) to serve as the distributor for the Class A, Class C, Class Y, Class R5 and Class R6 shares of the Fund. The Trust has adopted plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund’s Class A and Class C shares (collectively, the “Plans”). The Fund, pursuant to the Plans, pays IDI compensation at the annual rate of 0.25% of the Fund’s average daily net assets of Class A shares and 1.00% of the average daily net assets of Class C shares. Prior to their conversion to Class A shares, the Fund paid an annual rate of 1.00% of the average daily net assets of Class B shares. The fees are accrued daily and paid monthly. Of the Plan payments, up to 0.25% of the average daily net assets of each class of shares may be paid to furnish continuing personal shareholder services to customers who purchase and own shares of such classes. Any amounts not paid as a service fee under the Plans would constitute an asset-based sales charge. Rules of the Financial Industry Regulatory Authority (“FINRA”) impose a cap on the total sales charges, including asset-based sales charges, that may be paid by any class of shares of the Fund. For the six months ended April 30, 2018, expenses incurred under the Plans are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the six months ended April 30, 2018, IDI advised the Fund that IDI retained $1,604 in front-end sales commissions from the sale of Class A shares and $9 from Class C shares for CDSC imposed on redemptions by shareholders.
Certain officers and trustees of the Trust are officers and directors of the Adviser, IIS and/or IDI.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:
Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of April 30, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
The Fund’s policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the six months ended April 30, 2018, there were no material transfers between valuation levels.
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Investments in Securities | ||||||||||||||||
Non-U.S. Dollar Denominated Bonds & Notes | $ | — | $ | 13,859,048 | $ | — | $ | 13,859,048 | ||||||||
U.S. Dollar Denominated Bonds & Notes | — | 7,486,972 | — | 7,486,972 | ||||||||||||
U.S. Treasury Securities | — | 4,595,735 | — | 4,595,735 | ||||||||||||
Preferred Stocks | 452,055 | — | — | 452,055 | ||||||||||||
U.S. Government Sponsored Agency Mortgaged-Backed Securities | — | 91,493 | — | 91,493 | ||||||||||||
Money Market Funds | 421,854 | — | — | 421,854 | ||||||||||||
Options Purchased | — | 62,246 | — | 62,246 | ||||||||||||
Total Investments in Securities | 873,909 | 26,095,494 | — | 26,969,403 | ||||||||||||
Other Investments — Assets* | ||||||||||||||||
Forward Foreign Currency Contracts | — | 489,698 | — | 489,698 | ||||||||||||
Swap Agreements | — | 8,222 | — | 8,222 | ||||||||||||
— | 497,920 | — | 497,920 | |||||||||||||
Other Investments — Liabilities* | ||||||||||||||||
Forward Foreign Currency Contracts | — | (581,590 | ) | — | (581,590 | ) | ||||||||||
Options Written | — | (1,280 | ) | — | (1,280 | ) | ||||||||||
— | (582,870 | ) | — | (582,870 | ) | |||||||||||
Total Other Investments | — | (84,950 | ) | — | (84,950 | ) | ||||||||||
Total Investments | $ | 873,909 | $ | 26,010,544 | $ | — | $ | 26,884,453 |
* | Forward foreign currency contracts and swap agreements are valued at unrealized appreciation (depreciation). Options written are shown at value. |
19 Invesco World Bond Fund
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Statement of Assets and Liabilities.
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund’s derivative investments, detailed by primary risk exposure, held as of April 30, 2018:
Value | ||||||||||||
Derivative Assets | Currency Risk | Interest Rate Risk | Total | |||||||||
Unrealized appreciation on swap agreements — OTC | $ | — | $ | 8,222 | $ | 8,222 | ||||||
Options purchased, at value — OTC(a) | 14,337 | 47,909 | 62,246 | |||||||||
Unrealized appreciation on forward foreign currency contracts outstanding | 489,698 | — | 489,698 | |||||||||
Total Derivative Assets | 504,035 | 56,131 | 560,166 | |||||||||
Derivatives not subject to master netting agreements | — | — | — | |||||||||
Total Derivative Assets subject to master netting agreements | $ | 504,035 | $ | 56,131 | $ | 560,166 |
Value | ||||||||||||
Derivative Liabilities | Currency Risk | Interest Rate Risk | Total | |||||||||
Options written, at value — OTC | $ | (1,280 | ) | $ | – | $ | (1,280 | ) | ||||
Unrealized depreciation on forward foreign currency contracts outstanding | (581,590 | ) | — | (581,590 | ) | |||||||
Total Derivative Liabilities | (582,870 | ) | — | (582,870 | ) | |||||||
Derivatives not subject to master netting agreements | — | — | — | |||||||||
Total Derivative Liabilities subject to master netting agreements | $ | (582,870 | ) | $ | — | $ | (582,870 | ) |
(a) | Options purchased, at value as reported in the Schedule of Investments. |
Offsetting Assets and Liabilities
The table below reflects the Fund’s exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of April 30, 2018.
Financial Derivative Assets | Financial Derivative Liabilities | Collateral (Received)/Pledged | ||||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Options Purchased | Swap Agreements | Total Assets | Forward Foreign Currency Contracts | Options Written | Swap Agreements | Total Liabilities | Net Value of Derivatives | Non-Cash | Cash | Net Amount | ||||||||||||||||||||||||||||||||||||
Barclays PLC | $ | 81,500 | $ | — | $ | — | $ | 81,500 | $ | (115,422 | ) | $ | — | $ | — | $ | (115,422 | ) | $ | (33,922 | ) | $ | — | $ | — | $ | (33,922 | ) | ||||||||||||||||||||
CIBC World Markets Corp. | 2,556 | — | — | 2,556 | (6,217 | ) | — | — | (6,217 | ) | (3,661 | ) | — | — | (3,661 | ) | ||||||||||||||||||||||||||||||||
Citibank, N.A. | — | 61,878 | 11,886 | 73,764 | (124 | ) | (1,280 | ) | (3,092 | ) | (4,496 | ) | 69,268 | — | — | 69,268 | ||||||||||||||||||||||||||||||||
Deutsche Bank Securities Inc. | 85,850 | — | — | 85,850 | (170,051 | ) | — | — | (170,051 | ) | (84,201 | ) | — | — | (84,201 | ) | ||||||||||||||||||||||||||||||||
Goldman Sachs International | 110,609 | 368 | — | 110,977 | (158,928 | ) | — | — | (158,928 | ) | (47,951 | ) | — | — | (47,951 | ) | ||||||||||||||||||||||||||||||||
JPMorgan Chase & Co. | 88,062 | — | — | 88,062 | (33,233 | ) | — | — | (33,233 | ) | 54,829 | — | — | 54,829 | ||||||||||||||||||||||||||||||||||
Merrill Lynch International | 37,954 | — | — | 37,954 | (58,284 | ) | — | — | (58,284 | ) | (20,330 | ) | — | — | (20,330 | ) | ||||||||||||||||||||||||||||||||
Morgan Stanley & Co. LLC | 83,167 | — | — | 83,167 | (36,150 | ) | — | — | (36,150 | ) | 47,017 | — | — | 47,017 | ||||||||||||||||||||||||||||||||||
RBC Capital Markets Corp. | — | — | — | — | (3,181 | ) | — | — | (3,181 | ) | (3,181 | ) | — | — | (3,181 | ) | ||||||||||||||||||||||||||||||||
Total | $ | 489,698 | $ | 62,246 | $ | 11,886 | $ | 563,830 | $ | (581,590 | ) | $ | (1,280 | ) | $ | (3,092 | ) | $ | (585,962 | ) | $ | (22,132 | ) | $ | — | $ | — | $ | (22,132 | ) |
20 Invesco World Bond Fund
Effect of Derivative Investments for the six months ended April 30, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
Location of Gain (Loss) on Statement of Operations | ||||||||||||||||
Credit Risk | Currency Risk | Interest Rate Risk | Total | |||||||||||||
Realized Gain (Loss): | ||||||||||||||||
Forward foreign currency contracts | $ | — | $ | (147,693 | ) | $ | — | $ | (147,693 | ) | ||||||
Futures contracts | — | — | 48,100 | 48,100 | ||||||||||||
Options purchased(a) | — | (17,421 | ) | 80,398 | 62,977 | |||||||||||
Options written | — | (5,597 | ) | — | (5,597 | ) | ||||||||||
Swap agreements | (10,057 | ) | — | (198,950 | ) | (209,007 | ) | |||||||||
Change in Net Unrealized Appreciation (Depreciation): | ||||||||||||||||
Forward foreign currency contracts | — | 86,012 | — | 86,012 | ||||||||||||
Futures contracts | — | — | 41,251 | 41,251 | ||||||||||||
Options purchased(a) | — | (4,921 | ) | 3,465 | (1,456 | ) | ||||||||||
Options written | — | 20,752 | — | 20,752 | ||||||||||||
Swap agreements | 90,034 | — | 8,222 | 98,256 | ||||||||||||
Total | $ | 79,977 | $ | (68,868 | ) | $ | (17,514 | ) | $ | (6,405 | ) |
(a) | Options purchased are included in the net realized gain (loss) from investment securities and the change in net unrealized appreciation (depreciation) of investment securities. |
The table below summarizes the three months average notional value of futures contracts and the six months average notional value of forward foreign currency contracts, options purchased, options written and swap agreements outstanding during the period.
Forward Foreign Currency Contracts | Futures Contracts | Options Purchased | Options Written | Swap Agreements | ||||||||||||||||
Average notional value | $ | 32,363,466 | $ | 4,492,400 | $ | 3,212,725 | $ | 53,302 | $ | 8,533,685 |
NOTE 5—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and Trustees’ and Officers’ Fees and Benefits also include amounts accrued by the Fund to fund such deferred compensation amounts. Those Trustees who defer compensation have the option to select various Invesco Funds in which their deferral accounts shall be deemed to be invested. Finally, certain current Trustees were eligible to participate in a retirement plan that provided for benefits to be paid upon retirement to Trustees over a period of time based on the number of years of service. The Fund may have certain former Trustees who also participate in a retirement plan and receive benefits under such plan. Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to fund such retirement benefits. Obligations under the deferred compensation and retirement plans represent unsecured claims against the general assets of the Fund.
NOTE 6—Cash Balances
The Fund may borrow for leveraging in an amount up to 5% of the Fund’s total assets (excluding the amount borrowed) at the time the borrowing is made. In doing so, the Fund is permitted to temporarily carry a negative or overdrawn balance in its account with State Street Bank and Trust Company, the custodian bank. Such balances, if any at period end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate. The Fund may not purchase additional securities when any borrowings from banks exceed 5% of the Fund’s total assets.
NOTE 7—Tax Information
The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Fund’s fiscal year-end.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
21 Invesco World Bond Fund
The Fund had a capital loss carryforward as of October 31, 2017 as follows:
Capital Loss Carryforward* | ||||||||||||
Expiration | Short-Term | Long-Term | Total | |||||||||
Not subject to expiration | $ | 676,863 | $ | 467,779 | $ | 1,144,642 |
* | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
NOTE 8—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the six months ended April 30, 2018 was $16,862,353 and $18,435,307, respectively. During the same period, purchases and sales of U.S. Treasury obligations were $894,008 and $1,992,054, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | ||||
Aggregate unrealized appreciation of investments | $ | 1,327,230 | ||
Aggregate unrealized (depreciation) of investments | (1,073,111 | ) | ||
Net unrealized appreciation of investments | $ | 254,119 |
Cost of investments for tax purposes is $26,630,334.
NOTE 9—Share Information
Summary of Share Activity | ||||||||||||||||
Six months ended April 30, 2018(a) | Year ended October 31, 2017 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Sold: | ||||||||||||||||
Class A | 239,221 | $ | 2,523,223 | 386,135 | $ | 3,976,564 | ||||||||||
Class B(b) | — | — | 2,297 | 22,928 | ||||||||||||
Class C | 61,709 | 648,964 | 88,362 | 906,574 | ||||||||||||
Class Y | 93,286 | 981,827 | 611,943 | 6,211,858 | ||||||||||||
Class R5 | — | — | 2,567 | 27,121 | ||||||||||||
Class R6 | 5,037 | 52,492 | — | — | ||||||||||||
Issued as reinvestment of dividends: | ||||||||||||||||
Class A | 25,343 | 266,424 | 56,789 | 577,805 | ||||||||||||
Class B(b) | 88 | 924 | 600 | 6,090 | ||||||||||||
Class C | 3,272 | 34,350 | 6,981 | 70,996 | ||||||||||||
Class Y | 5,700 | 59,821 | 18,568 | 188,436 | ||||||||||||
Class R6 | 71 | 748 | — | — | ||||||||||||
Conversion of Class B shares to Class A shares:(c) | ||||||||||||||||
Class A | 18,932 | 202,956 | 18,145 | 185,281 | ||||||||||||
Class B | (18,980 | ) | (202,956 | ) | (18,156 | ) | (185,281 | ) | ||||||||
Reacquired: | ||||||||||||||||
Class A | (309,152 | ) | (3,243,889 | ) | (1,101,023 | ) | (11,183,581 | ) | ||||||||
Class B(b) | (1,970 | ) | (20,658 | ) | (8,550 | ) | (87,069 | ) | ||||||||
Class C | (46,675 | ) | (488,721 | ) | (188,446 | ) | (1,913,284 | ) | ||||||||
Class Y | (271,440 | ) | (2,850,368 | ) | (1,081,055 | ) | (10,940,824 | ) | ||||||||
Class R5 | — | — | (2,567 | ) | (27,112 | ) | ||||||||||
Class R6 | (13 | ) | (139 | ) | — | — | ||||||||||
Net increase (decrease) in share activity | (195,571 | ) | $ | (2,035,002 | ) | (1,207,410 | ) | $ | (12,163,498 | ) |
(a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 31% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Fund has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
(b) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
(c) | Effective as of the close of business on January 26, 2018, all outstanding Class B shares were converted to Class A shares. |
22 Invesco World Bond Fund
NOTE 10—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
Net asset value, beginning of period | Net investment income(a) | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | Dividends from net investment income | Distributions from net realized gains | Return of capital | Total distributions | Net asset of period | Total return(b) | Net assets, end of period (000’s omitted) | Ratio of net assets with fee waivers and/or expenses absorbed | Ratio of to average net assets without fee waivers and/or expenses | Ratio of net to average net assets | Portfolio turnover(c) | ||||||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | $ | 10.43 | $ | 0.17 | $ | (0.14 | ) | $ | 0.03 | $ | (0.14 | ) | $ | — | $ | — | $ | (0.14 | ) | $ | 10.32 | 0.23 | % | $ | 21,657 | 0.93 | %(d) | 2.14 | %(d) | 3.19 | %(d) | 63 | % | |||||||||||||||||||||||||||
Year ended 10/31/17 | 10.44 | 0.33 | (0.07 | ) | 0.26 | (0.04 | ) | — | (0.23 | ) | (0.27 | ) | 10.43 | 2.63 | 22,150 | 0.95 | 2.21 | 3.22 | 245 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.81 | 0.25 | 0.54 | 0.79 | (0.08 | ) | — | (0.08 | ) | (0.16 | ) | 10.44 | 8.02 | 28,870 | 1.10 | 1.84 | 2.36 | 246 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.63 | 0.18 | (0.74 | ) | (0.56 | ) | — | (0.14 | ) | (0.12 | ) | (0.26 | ) | 9.81 | (5.38 | ) | 26,426 | 1.10 | 1.72 | 1.79 | 135 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 11.07 | 0.20 | (0.30 | ) | (0.10 | ) | (0.12 | ) | (0.22 | ) | — | (0.34 | ) | 10.63 | (0.97 | ) | 32,668 | 1.10 | 1.68 | 1.83 | 237 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 11.37 | 0.18 | (0.37 | ) | (0.19 | ) | (0.11 | ) | — | — | (0.11 | ) | 11.07 | (1.68 | ) | 33,019 | 1.10 | 1.68 | 1.65 | 233 | ||||||||||||||||||||||||||||||||||||||||
Class B | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18(e) | 10.42 | 0.06 | 0.28 | 0.34 | (0.05 | ) | — | — | (0.05 | ) | 10.71 | 3.26 | — | 1.68 | (d) | 2.89 | (d) | 2.44 | (d) | 63 | ||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.43 | 0.25 | (0.07 | ) | 0.18 | (0.03 | ) | — | (0.16 | ) | (0.19 | ) | 10.42 | 1.80 | 217 | 1.70 | 2.96 | 2.47 | 245 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.79 | 0.16 | 0.56 | 0.72 | (0.05 | ) | — | (0.03 | ) | (0.08 | ) | 10.43 | 7.35 | 466 | 1.85 | 2.59 | 1.61 | 246 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.62 | 0.10 | (0.75 | ) | (0.65 | ) | — | (0.14 | ) | (0.04 | ) | (0.18 | ) | 9.79 | (6.19 | ) | 898 | 1.85 | 2.47 | 1.04 | 135 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 11.05 | 0.12 | (0.30 | ) | (0.18 | ) | (0.03 | ) | (0.22 | ) | — | (0.25 | ) | 10.62 | (1.63 | ) | 1,867 | 1.85 | 2.43 | 1.08 | 237 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 11.36 | 0.10 | (0.38 | ) | (0.28 | ) | (0.03 | ) | — | — | (0.03 | ) | 11.05 | (2.50 | ) | 2,850 | 1.85 | 2.43 | 0.90 | 233 | ||||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.41 | 0.13 | (0.14 | ) | (0.01 | ) | (0.10 | ) | — | — | (0.10 | ) | 10.30 | (0.15 | ) | 4,293 | 1.68 | (d) | 2.89 | (d) | 2.44 | (d) | 63 | |||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.42 | 0.25 | (0.07 | ) | 0.18 | (0.03 | ) | — | (0.16 | ) | (0.19 | ) | 10.41 | 1.80 | 4,147 | 1.70 | 2.96 | 2.47 | 245 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.79 | 0.17 | 0.54 | 0.71 | (0.05 | ) | — | (0.03 | ) | (0.08 | ) | 10.42 | 7.24 | 5,121 | 1.85 | 2.59 | 1.61 | 246 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.61 | 0.10 | (0.74 | ) | (0.64 | ) | — | (0.14 | ) | (0.04 | ) | (0.18 | ) | 9.79 | (6.10 | ) | 4,998 | 1.85 | 2.47 | 1.04 | 135 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 11.04 | 0.12 | (0.30 | ) | (0.18 | ) | (0.03 | ) | (0.22 | ) | — | (0.25 | ) | 10.61 | (1.63 | ) | 6,441 | 1.85 | 2.43 | 1.08 | 237 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 11.35 | 0.10 | (0.38 | ) | (0.28 | ) | (0.03 | ) | — | — | (0.03 | ) | 11.04 | (2.50 | ) | 5,562 | 1.85 | 2.43 | 0.90 | 233 | ||||||||||||||||||||||||||||||||||||||||
Class Y | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.42 | 0.18 | (0.14 | ) | 0.04 | (0.15 | ) | — | — | (0.15 | ) | 10.31 | 0.35 | 3,959 | 0.68 | (d) | 1.89 | (d) | 3.44 | (d) | 63 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.44 | 0.35 | (0.07 | ) | 0.28 | (0.04 | ) | — | (0.26 | ) | (0.30 | ) | 10.42 | 2.81 | 5,797 | 0.70 | 1.96 | 3.47 | 245 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.80 | 0.27 | 0.55 | 0.82 | (0.07 | ) | — | (0.11 | ) | (0.18 | ) | 10.44 | 8.40 | 10,509 | 0.85 | 1.59 | 2.61 | 246 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.63 | 0.21 | (0.76 | ) | (0.55 | ) | — | (0.14 | ) | (0.14 | ) | (0.28 | ) | 9.80 | (5.23 | ) | 1,716 | 0.85 | 1.47 | 2.04 | 135 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 11.06 | 0.23 | (0.30 | ) | (0.07 | ) | (0.14 | ) | (0.22 | ) | — | (0.36 | ) | 10.63 | (0.63 | ) | 4,989 | 0.85 | 1.43 | 2.08 | 237 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 11.37 | 0.21 | (0.39 | ) | (0.18 | ) | (0.13 | ) | — | — | (0.13 | ) | 11.06 | (1.52 | ) | 982 | 0.85 | 1.43 | 1.90 | 233 | ||||||||||||||||||||||||||||||||||||||||
Class R5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.42 | 0.18 | (0.15 | ) | 0.03 | (0.15 | ) | — | — | (0.15 | ) | 10.30 | 0.26 | 1 | 0.68 | (d) | 1.68 | (d) | 3.44 | (d) | 63 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.44 | 0.36 | (0.08 | ) | 0.28 | (0.04 | ) | — | (0.26 | ) | (0.30 | ) | 10.42 | 2.81 | 1 | 0.70 | 1.77 | 3.47 | 245 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.81 | 0.27 | 0.54 | 0.81 | (0.07 | ) | — | (0.11 | ) | (0.18 | ) | 10.44 | 8.29 | 1 | 0.85 | 1.30 | 2.61 | 246 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.64 | 0.21 | (0.76 | ) | (0.55 | ) | — | (0.14 | ) | (0.14 | ) | (0.28 | ) | 9.81 | (5.23 | ) | 1 | 0.85 | 1.16 | 2.04 | 135 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 11.07 | 0.23 | (0.30 | ) | (0.07 | ) | (0.14 | ) | (0.22 | ) | — | (0.36 | ) | 10.64 | (0.63 | ) | 118 | 0.85 | 1.15 | 2.08 | 237 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 11.37 | 0.21 | (0.38 | ) | (0.17 | ) | (0.13 | ) | — | — | (0.13 | ) | 11.07 | (1.43 | ) | 282 | 0.85 | 1.16 | 1.90 | 233 | ||||||||||||||||||||||||||||||||||||||||
Class R6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six months ended 04/30/18 | 10.43 | 0.18 | (0.14 | ) | 0.04 | (0.15 | ) | — | — | (0.15 | ) | 10.32 | 0.35 | 63 | 0.68 | (d) | 1.68 | (d) | 3.44 | (d) | 63 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/17 | 10.44 | 0.36 | (0.07 | ) | 0.29 | (0.04 | ) | — | (0.26 | ) | (0.30 | ) | 10.43 | 2.91 | 11 | 0.70 | 1.77 | 3.47 | 245 | |||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/16 | 9.81 | 0.25 | 0.56 | 0.81 | (0.07 | ) | — | (0.11 | ) | (0.18 | ) | 10.44 | 8.29 | 11 | 0.85 | 1.30 | 2.61 | 246 | ||||||||||||||||||||||||||||||||||||||||||
Year ended 10/31/15 | 10.63 | 0.20 | (0.74 | ) | (0.54 | ) | — | (0.14 | ) | (0.14 | ) | (0.28 | ) | 9.81 | (5.14 | ) | 19,413 | 0.85 | 1.16 | 2.04 | 135 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/14 | 11.07 | 0.23 | (0.31 | ) | (0.08 | ) | (0.14 | ) | (0.22 | ) | — | (0.36 | ) | 10.63 | (0.72 | ) | 12,637 | 0.85 | 1.14 | 2.08 | 237 | |||||||||||||||||||||||||||||||||||||||
Year ended 10/31/13 | 11.37 | 0.21 | (0.38 | ) | (0.17 | ) | (0.13 | ) | — | — | (0.13 | ) | 11.07 | (1.43 | ) | 8,752 | 0.85 | 1.16 | 1.90 | 233 |
(a) | Calculated using average shares outstanding. |
(b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
(c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
(d) | Ratios are annualized and based on average daily net assets (000’s omitted) of $22,342, $205, $4,223, $4,996, $1 and $61 for Class A, Class B, Class C, Class Y, Class R5 and Class R6 shares, respectively. |
(e) | Reflects activity for the period November 1, 2017 through January 26, 2018 (date of conversion). |
23 Invesco World Bond Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period November 1, 2017 through April 30, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
ACTUAL | HYPOTHETICAL (5% annual return before | |||||||||||||||||||||||
Class | Beginning Account Value (11/01/17) | Ending Account Value (04/30/18)1 | Expenses Paid During Period2 | Ending Account Value (04/30/18) | Expenses Paid During Period2 | Annualized Expense Ratio | ||||||||||||||||||
A | $ | 1,000.00 | $ | 1,002.30 | $ | 4.62 | $ | 1,020.18 | $ | 4.66 | 0.93 | % | ||||||||||||
C | 1,000.00 | 998.50 | 8.32 | 1,016.46 | 8.40 | 1.68 | ||||||||||||||||||
Y | 1,000.00 | 1,003.50 | 3.38 | 1,021.42 | 3.41 | 0.68 | ||||||||||||||||||
R5 | 1,000.00 | 1,002.60 | 3.38 | 1,021.42 | 3.41 | 0.68 | ||||||||||||||||||
R6 | 1,000.00 | 1,003.50 | 3.38 | 1,021.42 | 3.41 | 0.68 |
1 | The actual ending account value is based on the actual total return of the Fund for the period November 1, 2017 through April 30, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund’s expense ratio and a hypothetical annual return of 5% before expenses. |
2 | Expenses are equal to the Fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
24 Invesco World Bond Fund
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Visit invesco.com/edelivery to enjoy the convenience and security of anytime electronic access to your investment documents.
With eDelivery, you can elect to have any or all of the following materials delivered straight to your inbox to download, save and print from your own computer:
∎ Fund reports and prospectuses
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Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file numbers for the Fund are shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. | ||
SEC file numbers: 811-05426 and 033-19338 Invesco Distributors, Inc. WBD-SAR-1 06142018 1011 |
ITEM 2. | CODE OF ETHICS. | |
Not applicable for a semi-annual report. | ||
ITEM 3. | AUDIT COMMITTEE FINANCIAL EXPERT. | |
Not applicable. | ||
ITEM 4. | PRINCIPAL ACCOUNTANT FEES AND SERVICES. | |
PricewaterhouseCoopers LLP informed the Trust that it has identified an issue related to its independence under Rule 2-01(c)(1)(ii)(A) of Regulation S-X (referred to as the Loan Rule). The Loan Rule prohibits accounting firms, such as PricewaterhouseCoopers LLP, from being deemed independent if they have certain financial relationships with their audit clients or certain affiliates of those clients. The Trust is required under various securities laws to have its financial statements audited by an independent accounting firm. | ||
The Loan Rule specifically provides that an accounting firm would not be independent if it or certain affiliates and covered persons receives a loan from a lender that is a record or beneficial owner of more than ten percent of an audit client’s equity securities (referred to as a “more than ten percent owner”). For purposes of the Loan Rule, audit clients include the Funds as well as all registered investment companies advised by the Adviser and its affiliates, including other subsidiaries of the Adviser’s parent company, Invesco Ltd. (collectively, the Invesco Fund Complex). PricewaterhouseCoopers LLP informed the Trust it and certain affiliates and covered persons have relationships with lenders who hold, as record owner, more than ten percent of the shares of certain funds within the Invesco Fund Complex, which may implicate the Loan Rule. | ||
On June 20, 2016, the SEC Staff issued a “no-action” letter to another mutual fund complex (see Fidelity Management & Research Company et al., No-Action Letter) related to the audit independence issue described above. In that letter, the SEC confirmed that it would not recommend enforcement action against a fund that relied on audit services performed by an audit firm that was not in compliance with the Loan Rule in certain specified circumstances. In connection with prior independence determinations, PricewaterhouseCoopers LLP communicated, as contemplated by the no-action letter, that it believes that it remains objective and impartial and that a reasonable investor possessing all the facts would conclude that PricewaterhouseCoopers LLP is able to exhibit the requisite objectivity and impartiality to report on the Funds’ financial statements as the independent registered public accounting firm. PricewaterhouseCoopers LLP also represented that it has complied with PCAOB Rule 3526(b)(1) and (2), which are conditions to the Funds relying on the no action letter, and affirmed that it is an independent accountant within the meaning of PCAOB Rule 3520. Therefore, the Adviser, the Funds and PricewaterhouseCoopers LLP concluded that PricewaterhouseCoopers LLP could continue as the Funds’ independent registered public accounting firm. The Invesco Fund Complex relied upon the no-action letter in reaching this conclusion. | ||
If in the future the independence of PricewaterhouseCoopers LLP is called into question under the Loan Rule by circumstances that are not addressed in the SEC’s no-action letter, the Funds will need to take other action in order for the Funds’ filings with the SEC containing financial statements to be deemed compliant with applicable securities |
laws. Such additional actions could result in additional costs, impair the ability of the Funds to issue new shares or have other material adverse effects on the Funds. The SEC no-action relief was initially set to expire 18 months from issuance but has been extended by the SEC without an expiration date, except that the no-action letter will be withdrawn upon the effectiveness of any amendments to the Loan Rule designed to address the concerns expressed in the letter. | ||
ITEM 5. | AUDIT COMMITTEE OF LISTED REGISTRANTS. | |
Not applicable. | ||
ITEM 6. | SCHEDULE OF INVESTMENTS. | |
Investments in securities of unaffiliated issuers is included as part of the reports to stockholders filed under Item 1 of this Form. | ||
ITEM 7. | DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. | |
Not applicable. | ||
ITEM 8. | PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT 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. | |
None. | ||
ITEM 11. | CONTROLS AND PROCEDURES. | |
(a) | As of May 18, 2018, an evaluation was performed under the supervision and with the participation of the officers of the Registrant, including the Principal Executive Officer (“PEO”) and Principal Financial Officer (“PFO”), to assess the effectiveness of the Registrant’s disclosure controls and procedures, as that term is defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”), as amended. Based on that evaluation, the Registrant’s officers, including the PEO and PFO, concluded that, as of May 18, 2018, the Registrant’s disclosure controls and procedures were reasonably designed to ensure: (1) that information required to be disclosed by the Registrant on Form N-CSR is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Securities and Exchange Commission; and (2) that material information relating to the Registrant is made known to the PEO and PFO as appropriate to allow timely decisions regarding required disclosure. | |
(b) | There have been no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter |
of the period covered by the report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting. | ||
ITEM 12. | DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. | |
Not applicable. | ||
ITEM 13. | EXHIBITS. | |
13(a) (1) | Not applicable. | |
13(a) (2) | Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(a) under the Investment Company Act of 1940. | |
13(a) (3) | Not applicable. | |
13(a) (4) | Not applicable. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Registrant: AIM Investment Funds (Invesco Investment Funds)
By: | /s/ Sheri Morris | |
Sheri Morris | ||
Principal Executive Officer | ||
Date: | July 9, 2018 |
Pursuant to the requirements of the Securities and Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
By: | /s/ Sheri Morris | |
Sheri Morris | ||
Principal Executive Officer | ||
Date: | July 9, 2018 | |
By: | /s/ Kelli Gallegos | |
Kelli Gallegos | ||
Principal Financial Officer | ||
Date: | July 9, 2018 |
EXHIBIT INDEX
13(a) (1) | Not applicable. | |
13(a) (2) | Certifications of principal executive officer and Principal financial officer as required by Rule 30a-2(a) under the Investment Company Act of 1940. | |
13(a) (3) | Not applicable. | |
13(a) (4) | Not applicable. |