Prospectus
April
28,
2023
Series I shares and
Series II shares
Invesco
V.I. Global Real Estate Fund
Shares
of the Fund are currently offered only to insurance company separate accounts
funding variable annuity contracts and variable life insurance
policies.
As with all other
mutual fund securities, the U.S. Securities and Exchange Commission (SEC) has
not approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal
offense.
An investment in
the Fund:
◾
is not FDIC
insured;
◾
may lose value;
and
◾
is not guaranteed
by a bank.
Shares of the Fund
are used as investment vehicles for variable annuity contracts and variable life
insurance policies (variable products) issued by certain insurance companies,
and funds of funds. You cannot purchase shares of the Fund directly. As an owner
of a variable product (variable product owner) that offers the Fund as an
investment option,
however, you may
allocate your variable product values to a separate account of the insurance
company that invests in shares of the Fund.
Your
variable product is offered through its own prospectus, which contains
information about your variable product, including how to purchase the variable
product and how to allocate variable product values to the Fund.
Invesco
V.I. Global Real Estate Fund
The Fund’s
investment objective is total return through growth of capital and current
income.
This table
describes the fees and expenses that are incurred, directly or indirectly, when
a variable product owner buys, holds, or redeems interest in an insurance
company separate account that invests in the Series I shares or Series II shares
of the Fund but does not represent the effect of any fees or other expenses
assessed in connection with your variable product, and if it did, expenses would
be higher.
|
|
Series
I shares |
Series
II shares |
|
Maximum
Sales Charge (Load) Imposed on Purchases
(as
a percentage of offering price) |
||
|
| ||
|
Maximum
Deferred Sales Charge (Load) (as a
percentage
of original purchase price or redemption
proceeds,
whichever is less) |
||
|
| ||
|
|
Series
I shares |
Series
II shares |
|
Management
Fees |
||
|
| ||
|
Distribution
and/or Service (12b-1) Fees |
||
|
| ||
|
Other
Expenses |
||
|
| ||
|
Total
Annual Fund Operating Expenses |
||
|
| ||
This
Example does not represent the effect of any fees or expenses assessed in
connection with your variable product, and if it did, expenses would be
higher.
The
Example assumes that you invest $10,000 in the Fund for the time periods indicated
and then redeem all of your shares at the end of those periods. The Example also
assumes that your investment has a 5% return each year and that the Fund’s
operating expenses remain the same.
Although
your actual costs may be higher or lower, based on these assumptions, your
costs would be:
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
Series
I shares |
$ |
$ |
$ |
$ |
|
| ||||
|
Series
II shares |
$ |
$ |
$ |
$ |
|
| ||||
The Fund invests,
under normal circumstances, at least 80% of its net assets (plus any borrowings
for investment purposes) in securities of real estate and real estate-related
issuers, and in derivatives and other instruments that have economic
characteristics similar to such securities.
The
Fund’s common stock investments may also include China A-shares (shares of
companies based in mainland China that trade on the Shanghai Stock Exchange and
the Shenzhen Stock Exchange). The Fund invests primarily in real estate
investment trusts (REITs) and equity securities
(including common
and preferred stock, and convertible securities) of domestic and foreign
issuers.
The
Fund concentrates its
investments in the securities of domestic and foreign real estate and real
estate-related companies. The Fund considers an issuer to be a real estate or
real estate-related issuer if at least 50% of its assets, gross income or net
profits are attributable to ownership, construction, management or sale of
residential, commercial or industrial real estate. These issuers include
(i) REITs or other real estate operating issuers that (a) own
property, (b) make or invest in short-term construction and development
mortgage loans, or (c) invest in long-term mortgages or mortgage pools,
(ii) issuers whose products and services are related to the real estate
industry, such as manufacturers and distributors of building supplies and
financial institutions that issue or service mortgages, and (iii) issuers
included in a real estate or real estate-related industry based on any one or
more third-party providers, such as the S&P Global Industry Classification
Standard (GICS), the North American Industry Classification System (NAICS) or
the Bloomberg Industry Classification System (BICS).
The
Fund may also invest in debt securities of domestic and foreign issuers (including
corporate debt obligations and commercial mortgage-backed securities). The Fund
may invest up to 10% of its net assets in non-investment grade debt securities
(commonly known as “junk bonds”) of real estate and real estate-related
issuers.
Under
normal circumstances, the Fund will provide exposure to investments that
are economically tied to at least three different countries, including the U.S
and at least 40%, unless market conditions are not deemed favorable, in which
case at least 30% of the Fund’s net assets will provide exposure to investments
that are economically tied to countries other than the U.S. The Fund may invest
up to 20% of its net assets in securities of issuers located in emerging markets
countries, i.e., those that are generally in the early stages of their
industrial cycles.
The
Fund may invest in securities of issuers of all capitalization sizes.
Real
estate companies tend to have smaller asset bases compared with other market
sectors, therefore, the Fund may hold a significant amount of securities of
small- and mid-capitalization issuers.
The
Fund may engage in short sales of securities. The Fund may engage in short
sales with respect to securities it owns or securities it does not own.
Generally, the Fund will sell a security short to (1) take advantage of an
expected decline in the security price in anticipation of purchasing the same
security at a later date at a lower price, or (2) to protect a profit in a
security that it owns. The Fund will not sell a security short if, as a result
of such short sale, the aggregate market value of all securities sold short
exceeds 10% of the Fund’s net assets.
The
Fund can invest in derivative instruments including forward foreign currency
contracts.
The
Fund can use forward foreign currency contracts to hedge against adverse movements
in the foreign currencies in which portfolio securities are denominated; though
the Fund has not historically used these instruments.
When
constructing the portfolio, the portfolio managers use a fundamentals-driven
investment process, including an evaluation of factors such as property market
cycle analysis, property evaluation and management and structure review to
identify securities with characteristics including (i) quality underlying
properties, (ii) solid management teams with the ability to effectively
manage capital structure decisions and execute their stated strategic plan, and
(iii) attractive valuations relative to peer investment
alternatives.
The
portfolio managers focus on equity REITs and real estate operating issuers. Each
qualified security in the investment universe is analyzed using fundamental real
estate analysis and valuation review to identify securities that appear to have
relatively favorable long-term prospects and attractive values. Some of the
fundamental real estate factors that are considered
1 Invesco
V.I. Global Real Estate Fund
include: forecasted
occupancy and rental rates of the various property markets in which a firm may
operate, property locations, physical attributes, management depth and skill,
insider ownership, overall debt levels, percentage of variable rate financing
and fixed charge coverage ratios. The issuers that are believed to have the most
attractive fundamental real estate attributes are then evaluated on the basis of
relative value. Some of the valuation factors that are considered include: cash
flow consistency and growth, dividend yield, dividend coverage and growth, and
cash flow and assets to price multiples.
The
portfolio managers seek to construct a portfolio with risk characteristics
similar to the FTSE EPRA Nareit Developed Index. The Fund uses this index as a
guide in structuring the portfolio, but the Fund is not an index
fund.
The
portfolio managers seek to limit risk through various controls, such
as
diversifying the portfolio property types and geographic areas as well as by
considering the relative liquidity of each security and limiting the size of any
one holding.
The
portfolio managers will consider selling a security if they conclude
(1) its
relative valuation has fallen below desired levels, (2) its risk/return
profile has changed significantly, (3) its fundamentals have changed, or
(4) a more attractive investment opportunity is identified.
As
part of the Fund’s investment process to implement its investment strategy in pursuit
of its investment objective, the Fund’s portfolio managers may also consider
both qualitative and quantitative environmental, social and governance (“ESG”)
factors they believe to be material to understand an issuer’s fundamentals,
assess whether any ESG factors pose a material financial risk or opportunity to
the issuer and determine whether such risks are appropriately reflected in the
issuer’s valuation. This analysis may involve the use of third-party research as
well as proprietary research. Consideration of ESG factors is just one component
of the portfolio managers' assessment of issuers eligible for investment and not
necessarily determinative to an investment decision. Therefore, the Fund’s
portfolio managers may still invest in securities of issuers that may be viewed
as having a high ESG risk profile. The ESG factors considered by the Fund’s
portfolio managers may change over time,
one or
more factors may not be relevant with respect to all issuers eligible for
investment and ESG considerations may not be applied to each issuer or Fund
investment.
2 Invesco
V.I. Global Real Estate Fund
3 Invesco
V.I. Global Real Estate Fund
Fund
performance reflects any applicable fee waivers and expense reimbursements.
Performance returns would be lower without applicable fee waivers and expense
reimbursements.
All
Fund
performance shown assumes the reinvestment of dividends and capital gains and
the effect of the Fund's expenses.
The
Series I shares and Series II shares invest in the same portfolio of
securities and will
have substantially similar performance, except to the extent that the expenses
borne by each share class differ. Series II shares have higher expenses (and
therefore lower performance) resulting from its Rule 12b-1 plan, which provides
for a maximum fee equal to an annual rate of 0.25% (expressed as a percentage of
average daily net assets of the Fund).
Annual Total Returns
|
Series
I |
Period
Ended |
Returns |
|
|
|
|
|
|
|
- |
Average Annual Total Returns (for the periods ended December 31, 2022)
|
|
Inception
Date |
1
Year |
5
Years |
10
Years |
|
Series
I |
- |
- |
||
|
| ||||
|
Series
II |
- |
- |
||
|
| ||||
|
Custom
Invesco Global Real Estate Index (Net) (reflects
reinvested dividends net of withholding
taxes,
but reflects no deduction for fees, expenses |
- |
- |
||
|
| ||||
|
Lipper
VUF Real Estate Funds Classification Average |
- |
|||
|
| ||||
|
MSCI
World IndexSM
(Net) (reflects reinvested
dividends
net of withholding taxes, but reflects no
deduction
for fees, expenses or other taxes) |
- |
|||
|
| ||||
1
Management
of the Fund
Investment Adviser:
Invesco Advisers, Inc. (Invesco or the Adviser)
Investment
Sub-Adviser: Invesco Asset Management Limited
|
Portfolio
Managers |
Title |
Length
of Service on the Fund |
James
Cowen |
Portfolio
Manager |
2008 |
|
| ||
Grant
Jackson, CFA |
Portfolio
Manager |
2018 |
|
| ||
Chip
McKinley |
Portfolio
Manager |
2022 |
|
| ||
Darin
Turner |
Portfolio
Manager |
2010 |
|
| ||
Ping-Ying
Wang, CFA |
Portfolio
Manager |
2006 |
|
| ||
Purchase
and Sale of Fund Shares
You cannot purchase
or sell (redeem) shares of the Fund directly. Please contact the insurance
company that issued your variable product for more information on the purchase
and sale of Fund shares. For more information, see “Other Information—Purchase
and Redemption of Shares” in the prospectus.
Tax
Information
The Fund expects,
based on its investment objective and strategies, that its distributions, if
any, will consist of ordinary income, capital gains, or some combination of
both. Because shares of the Fund must be purchased through variable products,
such distributions will be exempt from current taxation if left to accumulate
within the variable product. Consult your variable insurance contract prospectus
for additional tax information.
4 Invesco
V.I. Global Real Estate Fund
Payments
to Insurance Companies
If you purchase the
Fund through an insurance company or other financial intermediary, the Fund, the
Fund’s distributor or its related companies may pay the intermediary for the
sale of Fund shares and related services. These payments may create a conflict
of interest by influencing the insurance company or other intermediary and your
salesperson or financial adviser to recommend the Fund over another investment.
Ask your salesperson or financial adviser or visit your financial intermediary’s
website for more information.
Investment Objective(s), Strategies, Risks and Portfolio Holdings
Objective(s)
and Strategies
The Fund’s
investment objective is total return through growth of capital and current
income. The Fund’s investment objective may be changed by the Board of Trustees
(the Board) without shareholder approval.
The
Fund invests, under normal circumstances, at least 80% of its net assets (plus any
borrowings for investment purposes) in securities of real estate and real
estate-related issuers, and in derivatives and other instruments that have
economic characteristics similar to such securities. The Fund’s common stock
investments may also include China A-shares (shares of companies based in
mainland China that trade on the Shanghai Stock Exchange and the Shenzhen Stock
Exchange). The Fund invests primarily in REITs and equity securities (including
common and preferred stock, and convertible securities) of domestic and foreign
issuers.
REITs
are entities that sell equity or debt securities to investors and use
the
proceeds to invest in real estate or interests therein.
The
Fund concentrates its
investments in the securities of domestic and foreign real estate and real
estate-related companies. The Fund considers an issuer to be a real estate or
real estate-related issuer if at least 50% of its assets, gross income or net
profits are attributable to ownership, construction, management or sale of
residential, commercial or industrial real estate. These issuers include
(i) REITs or other real estate operating issuers that (a) own
property, (b) make or invest in short-term construction and development
mortgage loans, or (c) invest in long-term mortgages or mortgage pools,
(ii) issuers whose products and services are related to the real estate
industry, such as manufacturers and distributors of building supplies and
financial institutions that issue or service mortgages, and (iii) issuers
included in a real estate or real estate-related industry based on any one or
more third-party providers, such as GICS, NAICS or BICS.
The
Fund may also invest in debt securities of domestic and foreign issuers (including
corporate debt obligations and commercial mortgage-backed securities). The Fund
may invest up to 10% of its net assets in non-investment grade debt securities
(commonly known as “junk bonds”) of real estate and real estate-related issuers.
Investment grade securities are: (i) securities rated BBB- or higher by
S&P Global Ratings (S&P) or Baa3 or higher by Moody’s Investors Service,
Inc. (Moody’s) or an equivalent rating by another nationally recognized
statistical rating organization (NRSRO), (ii) securities with comparable
short-term NRSRO ratings, or (iii) unrated securities determined by the
Adviser to be of comparable quality, each at the time of purchase.
Under
normal circumstances, the Fund will provide exposure to investments that
are economically tied to at least three different countries, including the U.S.
and at least 40%, unless market conditions are not deemed favorable, in which
case at least 30% of the Fund’s net assets will provide exposure to investments
that are economically tied to countries other than the U.S. The Fund may invest
up to 20% of its net assets in securities of issuers located in emerging markets
countries, i.e., those that are generally in the early stages of their
industrial cycles.
The
Fund may invest in securities of issuers of all capitalization sizes.
Real
estate companies tend to have smaller asset bases compared with
other market
sectors, therefore, the Fund may hold a significant amount of securities of
small- and mid-capitalization issuers.
The
Fund considers an issuer to be a small-capitalization issuer if it has
a
market capitalization, at the time of purchase, within the range of market
capitalizations of the largest and smallest capitalized companies included in
the Russell 2000® Index during the
most recent 11-month period (based on month-end data) plus the most recent data
during the current month. A company's “market capitalization” is the value of
its outstanding stock.
The
Fund considers an issuer to be a mid-capitalization issuer if it has a
market
capitalization, at the time of purchase, within the range of market
capitalizations of the largest and smallest capitalized companies included in
the Russell Midcap® Index during the
most recent 11-month period (based on month-end data) plus the most recent data
during the current month.
The
Fund may engage in short sales of securities. A short sale occurs when the Fund sells
a security, but does not deliver a security it owns when the sale settles.
Instead, it borrows that security for delivery when the sale settles. The Fund
may engage in short sales with respect to securities it owns or securities it
does not own. Generally, the Fund will sell a security short to (1) take
advantage of an expected decline in the security price in anticipation of
purchasing the same security at a later date at a lower price, or (2) to
protect a profit in a security that it owns. The Fund will not sell a security
short if, as a result of such short sale, the aggregate market value of all
securities sold short exceeds 10% of the Fund’s net assets.
The
Fund can invest in derivative instruments including forward foreign currency
contracts.
A
forward foreign currency contract is an agreement between parties to
exchange a
specified amount of currency at a specified future time at a specified rate. The
Fund can use forward foreign currency contracts to hedge against adverse
movements in the foreign currencies in which portfolio securities are
denominated; though the Fund has not historically used these
instruments.
When
constructing the portfolio, the portfolio managers use a fundamentals-driven
investment process, including an evaluation of factors such as property market
cycle analysis, property evaluation and management and structure review to
identify securities with characteristics including (i) quality underlying
properties, (ii) solid management teams with the ability to effectively
manage capital structure decisions and execute their stated strategic plan, and
(iii) attractive valuations relative to peer investment
alternatives.
The
portfolio managers focus on equity REITs and real estate operating issuers. Each
qualified security in the investment universe is analyzed using fundamental real
estate analysis and valuation review to identify securities that appear to have
relatively favorable long-term prospects and attractive values. Some of the
fundamental real estate factors that are considered include: forecasted
occupancy and rental rates of the various property markets in which a firm may
operate, property locations, physical attributes, management depth and skill,
insider ownership, overall debt levels, percentage of variable rate financing
and fixed charge coverage ratios. The issuers that are believed to have the most
attractive fundamental real estate attributes are then evaluated on the basis of
relative value. Some of the valuation factors that are considered include: cash
flow consistency and growth, dividend yield, dividend coverage and growth, and
cash flow and assets to price multiples.
The
portfolio managers seek to construct a portfolio with risk characteristics
similar to the FTSE EPRA Nareit Developed Index. The Fund uses this index as a
guide in structuring the portfolio, but the Fund is not an index
fund.
The
portfolio managers seek to limit risk through various controls, such
as
diversifying the portfolio property types and geographic areas as well as by
considering the relative liquidity of each security and limiting the size of any
one holding.
The
portfolio managers will consider selling a security if they conclude
(1) its
relative valuation has fallen below desired levels, (2) its risk/return
5 Invesco
V.I. Global Real Estate Fund
profile has changed
significantly, (3) its fundamentals have changed, or (4) a more
attractive investment opportunity is identified.
As
part of the Fund’s investment process to implement its investment strategy in pursuit
of its investment objective, the Fund’s portfolio managers may also consider
both qualitative and quantitative environmental, social and governance (“ESG”)
factors they believe to be material to understand an issuer’s fundamentals,
assess whether any ESG factors pose a material financial risk or opportunity to
the issuer and determine whether such risks are appropriately reflected in the
issuer’s valuation. This analysis may involve the use of third-party research as
well as proprietary research. Consideration of ESG factors is just one component
of the portfolio managers' assessment of issuers eligible for investment and not
necessarily determinative to an investment decision. Therefore, the Fund’s
portfolio managers may still invest in securities of issuers that may be viewed
as having a high ESG risk profile. The ESG factors considered by the Fund’s
portfolio managers may change over time,
one or
more factors may not be relevant with respect to all issuers eligible for
investment and ESG considerations may not be applied to each issuer or Fund
investment.
In
anticipation of or in response to market, economic, political, or other
conditions, the
Fund’s portfolio managers may temporarily use a different investment strategy
for defensive purposes. If the Fund’s portfolio managers do so, different
factors could affect the Fund’s performance and the Fund may not achieve its
investment objective.
The
Fund’s investments in the types of securities and other investments described in this
prospectus vary from time to time, and, at any time, the Fund may not be
invested in all of the types of securities and other investments described in
this prospectus. The Fund may also invest in securities and other investments
not described in this prospectus.
For
more information, see “Description of the Funds and Their Investments and
Risks” in the Fund’s SAI.
Risks
The principal risks
of investing in the Fund are:
Market
Risk. The market values
of the Fund’s investments, and therefore the value of the Fund’s shares, will go
up and down, sometimes rapidly or unpredictably. Market risk may affect a single
issuer, industry or section of the economy, or it may affect the market as a
whole. The value of the Fund’s investments may go up or down due to general
market conditions that are not specifically related to the particular issuer,
such as real or perceived adverse economic conditions, changes in the general
outlook for revenues or corporate earnings, changes in interest or currency
rates, regional or global instability, or adverse investor sentiment generally.
The value of the Fund’s investments may also go up or down due to factors that
affect an individual issuer or a particular industry or sector, such as changes
in production costs and competitive conditions within an industry. In addition,
natural or environmental disasters, widespread disease or other public health
issues, war, military conflict, acts of terrorism,
economic crisis or
other events may have a significant impact on the value of the Fund’s
investments, as well as the financial markets and global economy generally. Such
circumstances may also impact the ability of the Adviser to effectively
implement the Fund’s investment strategy. During a general downturn in the
financial markets, multiple asset classes may decline in value. When markets
perform well, there can be no assurance that specific investments held by the
Fund will rise in value.
◾
Market
Disruption Risks Related to Russia-Ukraine Conflict. Following
Russia’s invasion of Ukraine in late February 2022, various countries, including
the United States, as well as North Atlantic Treaty Organization
(NATO)
member
countries and the European Union, issued broad-ranging economic sanctions
against Russia. The war in Ukraine (and the potential for further sanctions in
response to Russia’s continued military activity)
may
escalate.
These
and other corresponding events, have had, and could continue to have, severe
negative effects on regional and global economic and financial markets,
including increased volatility, reduced liquidity, and overall
uncertainty. The
negative impacts may be particularly acute in certain sectors including, but not
limited to, energy and financials. Russia may take additional countermeasures or
retaliatory actions (including cyberattacks), which could exacerbate negative
consequences on global financial markets. The duration of the conflict and
corresponding sanctions and related events cannot be predicted. The foregoing
may result in a negative impact on Fund performance and the value of an
investment in the Fund, even beyond any direct investment exposure the Fund may
have to Russian issuers or the adjoining geographic regions.
◾
COVID-19. The “COVID-19”
strain of coronavirus has resulted in instances of market closures and
dislocations, extreme volatility, liquidity constraints and increased trading
costs. Efforts to contain its spread have resulted in travel restrictions,
disruptions of healthcare systems, business operations (including business
closures) and supply chains, layoffs, lower consumer demand and employee
availability, and defaults and credit downgrades, among other significant
economic impacts that have disrupted global economic activity across many
industries. Such economic impacts may exacerbate other pre-existing political,
social and economic risks locally or globally and cause general concern and
uncertainty. The full economic impact and ongoing effects of COVID-19 (or other
future epidemics or pandemics) at the macro-level and on individual businesses
are unpredictable and may result in significant and prolonged effects on the
Fund’s performance.
REIT
Risk/Real Estate Risk.
Investments in real
estate related instruments may be adversely affected by economic, legal,
cultural, environmental or technological factors that affect property values,
rents or occupancies. Real estate companies, including REITs or similar
structures, tend to be small- and mid-cap companies and their shares may be more
volatile and less liquid than larger companies. The value of investments in real
estate related companies may be affected by the quality of management, the
ability to repay loans, the utilization of leverage and financial covenants
related thereto, whether the company carries adequate insurance and
environmental factors. If a real estate related company defaults on certain
types of debt obligations held by the Fund, the Fund may acquire real estate
directly, which involves additional risks such as environmental liabilities;
difficulty in valuing and selling the real estate; and economic or regulatory
changes.
Investing
in Stocks Risk. Common stock
represents an ownership interest in a company. It ranks below preferred stock
and debt securities in claims for dividends and in claims for assets of the
issuer in a liquidation or bankruptcy. Common stocks may be exchange-traded or
over-the-counter securities. Over-the-counter securities may be less liquid than
exchange-traded securities.
The
value of the Fund’s portfolio may be affected by changes in the stock markets.
Stocks and other equity securities fluctuate in price in response to changes to
equity markets in general. Stock markets may experience significant short-term
volatility and may fall or rise sharply at times. Adverse events in any part of
the equity or fixed-income markets may have unexpected negative effects on other
market segments. Different stock markets may behave differently from each other
and U.S. stock markets may move in the opposite direction from one or more
foreign stock markets.
The
prices of individual stocks generally do not all move in the same direction at the
same time. However, individual stock prices tend to go up and down more
dramatically than those of certain other types of investments, such as bonds. A
variety of factors can negatively affect the price of a particular company’s
stock. These factors may include, but are not limited to: poor earnings reports,
a loss of customers, litigation against the company, general unfavorable
performance of the company’s sector or industry, or changes in government
regulations affecting the company or its industry. To the extent that securities
of a particular type are emphasized (for example foreign stocks, stocks of
small- or mid-cap companies, growth or value stocks, or stocks of companies in a
particular industry), fund share
6 Invesco
V.I. Global Real Estate Fund
values may
fluctuate more in response to events affecting the market for those types of
securities.
Foreign
Securities Risk. The value of the
Fund's foreign investments may be adversely affected by political and social
instability in the home countries of the issuers of the investments, by changes
in economic or taxation policies in those countries, or by the difficulty in
enforcing obligations in those countries. Foreign investments also involve the
risk of the possible seizure, nationalization or expropriation of the issuer or
foreign deposits (in which the Fund could lose its entire investments in a
certain market) and the possible adoption of foreign governmental restrictions
such as exchange controls. Foreign companies generally may be subject to less
stringent regulations than U.S. companies, including financial reporting
requirements and auditing and accounting controls, and may therefore be more
susceptible to fraud or corruption. Also, there may be less publicly available
information about companies in certain foreign countries than about U.S.
companies making it more difficult for the Adviser to evaluate those companies.
The laws of certain countries may put limits on the Fund’s ability to recover
its assets held at a foreign bank if the foreign bank, depository or issuer of a
security, or any of their agents, goes bankrupt. Trading in many foreign
securities may be less liquid and more volatile than U.S. securities due to the
size of the market or other factors. Changes in political and economic factors
in one country or region could adversely affect conditions in another country or
region. Investments in foreign securities may also expose the Fund to time-zone
arbitrage risk. At times, the Fund may emphasize investments in a particular
country or region and may be subject to greater risks from adverse events that
occur in that country or region. Unless the Fund has hedged its foreign currency
exposure, foreign securities risk also involves the risk of negative foreign
currency rate fluctuations, which may cause the value of securities denominated
in such foreign currency (or other instruments through which the Fund has
exposure to foreign currencies) to decline in value. Currency exchange rates may
fluctuate significantly over short periods of time. Currency hedging strategies,
if used, are not always successful. For instance, currency forward contracts, if
used by the Fund, could reduce performance if there are unanticipated changes in
currency exchange rates.
Emerging
Market Securities Risk. Emerging markets
(also referred to as developing markets) are generally subject to greater market
volatility, political, social and economic instability, uncertainty regarding
the existence of trading markets and more governmental limitations on foreign
investment than more developed markets. In addition, companies operating in
emerging markets may have greater concentration in a few industries resulting in
greater vulnerability to regional and global trade conditions and also may be
subject to lower trading volume and greater price fluctuations than companies in
more developed markets. Unexpected market closures may also affect investments
in emerging markets. Settlement procedures may differ from those of more
established securities markets, and settlement delays may result in the
inability to invest assets or dispose of portfolio securities in a timely
manner. As a result there could be subsequent declines in value of the portfolio
security, a decrease in the level of liquidity of the portfolio, or, if there is
a contract to sell the security, a possible liability to the
purchaser.
Such
countries’ economies may be more dependent on relatively few industries or
investors that may be highly vulnerable to local and global changes. Emerging
market countries may also have higher rates of inflation and more rapid and
extreme fluctuations in inflation rates and greater sensitivity to interest rate
changes. Further, companies in emerging market countries generally may be
subject to less stringent regulatory, disclosure, financial reporting,
accounting, auditing and recordkeeping standards than companies in more
developed countries and, as a result, the nature and quality of such information
may vary. Information about such companies may be less available and reliable
and, therefore, the ability to conduct adequate due diligence in emerging
markets may be limited which can impede the Fund’s ability to evaluate such
companies. In addition, certain emerging market countries may impose material
limitations on Public
Company Accounting
Oversight Board (PCAOB) inspection, investigation and enforcement capabilities,
which can hinder the PCAOB’s ability to engage in independent oversight or
inspection of accounting firms located in or operating in certain emerging
markets.
There
is no
guarantee that the quality of financial reporting or the audits conducted by
audit firms of emerging market issuers meet PCAOB standards.
Securities
law in many emerging market countries is relatively new and unsettled.
Therefore, laws regarding foreign investment in emerging market securities,
securities regulation, title to securities, and shareholder rights may change
quickly and unpredictably. Emerging market countries also may have less
developed legal systems allowing for enforcement of private property rights
and/or redress for injuries to private property (including bankruptcy,
confiscatory taxation, expropriation, nationalization of a company’s assets,
restrictions on foreign ownership of local companies, restrictions on
withdrawing assets from the country, protectionist measures and practices such
as share blocking). Certain governments may require approval for the
repatriation of investment income, capital or the proceeds of sales of
securities by foreign investors. The ability to bring and enforce actions in
emerging market countries, or to obtain information needed to pursue or enforce
such actions, may be limited and shareholder claims may be difficult or
impossible to pursue. In addition, the taxation systems at the federal, regional
and local levels in emerging market countries may be less transparent and
inconsistently enforced, and subject to sudden change.
Emerging
market countries may have a higher degree of corruption and fraud than
developed market countries, as well as counterparties and financial institutions
with less financial sophistication, creditworthiness and/or resources. The
governments in some emerging market countries have been engaged in programs to
sell all or part of their interests in government-owned or controlled
enterprises. However, in certain emerging market countries, the ability of
foreign entities to participate in privatization programs may be limited by
local law. There can be no assurance that privatization programs will be
successful.
Other
risks of investing in emerging market securities may include additional
transaction costs, delays in settlement procedures, unexpected market closures,
and lack of timely information.
The
Fund's investments in China A-shares are subject to trading restrictions, quota
limitations and clearing and settlement risks.
Preferred
Securities Risk. Preferred
securities are subject to issuer-specific and market risks applicable generally
to equity securities. Preferred stock has a set dividend rate and ranks ahead of
common stocks and behind debt securities in claims for dividends and for assets
of the issuer in a liquidation or bankruptcy. Preferred securities also may be
subordinated to bonds or other debt instruments in an issuer’s capital
structure, subjecting them to a greater risk of non-payment than these more
senior securities. For this reason, the value of preferred securities will
usually react more strongly than bonds and other debt securities to actual or
perceived changes in the company’s financial condition or prospects. Preferred
securities may be less liquid than many other securities, such as common stocks,
and generally offer no voting rights with respect to the issuer.
Convertible
Securities Risk. The market value
of a convertible security performs like that of a regular debt security; that
is, if market interest rates rise, the value of a convertible security usually
falls. In addition, convertible securities are subject to the risk that the
issuer will not be able to pay interest or dividends when due, and their market
value may change based on changes in the issuer’s credit rating or the market’s
perception of the issuer’s creditworthiness. Convertible securities can be
converted into or exchanged for a set amount of common stock of an issuer within
a particular period of time at a specified price or according to a price
formula. Convertible debt securities pay interest and convertible preferred
stocks pay dividends until they mature or are converted, exchanged or redeemed.
Some convertible debt securities may be considered “equity equivalents” because
of the feature that makes them convertible into common stock. Since a
convertible security derives a portion of its value
7 Invesco
V.I. Global Real Estate Fund
from the common
stock into which it may be converted, a convertible security is also subject to
the same types of market and issuer risks that
apply
to the underlying common stock. In addition, certain convertible securities are
subject to involuntary conversions and may undergo principal write-downs upon
the occurrence of certain triggering events. These convertible securities are
subject to an increased risk of loss and are generally subordinate in rank to
other debt obligations of the issuer. Convertible securities may be rated below
investment grade and therefore considered to have more speculative
characteristics and greater susceptibility to default or decline in market value
than investment grade securities.
Geographic
Focus Risk. The Fund may from
time to time have a substantial amount of its assets invested in securities of
issuers located in a single country or a limited number of countries. If the
Fund focuses its investments in this manner, adverse economic, political or
social conditions in those countries may have a significant negative impact on
the Fund’s investment performance. This risk is heightened if the Fund focuses
its investments in emerging market countries or developed countries prone to
periods of instability. The Schedule of Investments included in the Fund's
annual and semi-annual reports identifies the countries in which the Fund had
invested and the level of investment, as of the date of the
reports.
Small-
and Mid-Capitalization Companies Risk. Investing in
securities of small- and mid-capitalization companies involves greater risk than
customarily is associated with investing in larger, more established companies.
Stocks of small- and mid-capitalization companies tend to be more vulnerable to
changing market conditions, may have little or no operating history or track
record of success, and may have more limited product lines and markets, less
experienced management and fewer financial resources than larger companies.
These companies’ securities may be more volatile and less liquid than those of
more established companies. They may be more sensitive to changes in a company’s
earnings expectations and may experience more abrupt and erratic price
movements. Smaller companies’ securities often trade in lower volumes and in
many instances, are traded over-the-counter or on a regional securities
exchange, where the frequency and volume of trading is substantially less than
is typical for securities of larger companies traded on national securities
exchanges. Therefore, the securities of smaller companies may be subject to
wider price fluctuations and it might be harder for the Fund to dispose of its
holdings at an acceptable price when it wants to sell them. In addition,
investors might seek to trade Fund shares based on their knowledge or
understanding of the value of smaller company securities (this is sometimes
referred to as “price arbitrage”), which could interfere with the efficient
management of the Fund. Since small and mid-cap companies typically reinvest a
high proportion of their earnings in their business, they may not pay dividends
for some time, particularly if they are newer companies. It may take a
substantial period of time to realize a gain on an investment in a small- or
mid-cap company, if any gain is realized at all. The relative sizes of companies
may change over time as the securities market changes, and the Fund is not
required to sell the securities of companies whose market capitalizations have
grown or decreased due to market fluctuations.
Debt
Securities Risk. The prices of debt
securities held by the Fund will be affected by changes in interest rates, the
creditworthiness of the issuer and other factors. An increase in prevailing
interest rates typically causes the value of existing debt securities to fall
and often has a greater impact on longer-duration debt securities and higher
quality debt securities. Falling interest rates will cause the Fund to reinvest
the proceeds of debt securities that have been repaid by the issuer at lower
interest rates. Falling interest rates may also reduce the Fund’s distributable
income because interest payments on floating rate debt instruments held by the
Fund will decline. The Fund could lose money on investments in debt securities
if the issuer or borrower fails to meet its obligations to make interest
payments and/or to repay principal in a timely manner. If an issuer seeks to
restructure the terms of its borrowings or the Fund is required to seek recovery
upon a default in the payment of interest or the repayment of principal, the
Fund
may incur
additional expenses. Changes in an issuer’s financial strength, the market’s
perception of such strength or in the credit rating of the issuer or the
security may affect the value of debt securities. The Adviser’s credit analysis
may fail to anticipate such changes, which could result in buying a debt
security at an inopportune time or failing to sell a debt security in advance of
a price decline or other credit event.
High
Yield Debt Securities (Junk Bond) Risk. The Fund’s
investments in high yield debt securities (commonly referred to as “junk bonds”)
and other lower-rated securities will subject the Fund to substantial risk of
loss. These securities are considered to be speculative with respect to the
issuer’s ability to pay interest and principal when due and are more susceptible
to default or decline in market value due to adverse economic, regulatory,
political or company developments than higher rated or investment grade
securities. Prices of high yield debt securities tend to be very volatile. These
securities are less liquid than investment grade debt securities and may be
difficult to sell at a desirable time or price, particularly in times of
negative sentiment toward high yield securities.
Mortgage-
and Asset-Backed Securities Risk. Mortgage- and
asset-backed securities, including collateralized debt obligations and
collateralized mortgage obligations, differ from conventional debt securities
because principal is paid back over the life of the security rather than at
maturity. Mortgage- and asset-backed securities are subject to prepayment or
call risk, which is the risk that a borrower's payments may be received earlier
or later than expected due to changes in prepayment rates on underlying loans.
Faster prepayments often happen when interest rates are falling. As a result,
the Fund may reinvest these early payments at lower interest rates, thereby
reducing the Fund's income. Mortgage- and asset-backed securities also are
subject to extension risk. An unexpected rise in interest rates could reduce the
rate of prepayments and extend the life of the mortgage- and asset-backed
securities, causing the price of the mortgage- and asset-backed securities and
the Fund’s share price to fall and would make the mortgage- and asset-backed
securities more sensitive to interest rate changes. An unexpectedly high rate of
defaults on the mortgages held by a mortgage pool will adversely affect the
value of mortgage-backed securities and will result in losses to the Fund.
Privately-issued mortgage-backed securities and asset-backed securities may be
less liquid than other types of securities and the Fund may be unable to sell
these securities at the time or price it desires. During periods of market
stress or high redemptions, the Fund may be forced to sell these securities at
significantly reduced prices, resulting in losses. Liquid privately-issued
mortgage-backed securities and asset-backed securities can become illiquid
during periods of market stress. Privately-issued mortgage-related securities
are not subject to the same underwriting requirements for the underlying
mortgages that are applicable to those mortgage-related securities that have
government or government-sponsored entity guarantees. As a result, the mortgage
loans underlying privately-issued mortgage-related securities may, and
frequently do, have less favorable collateral, credit risk, liquidity risk or
other underwriting characteristics than government or government-sponsored
mortgage-related securities and have wider variances in a number of terms
including interest rate, term, size, purpose and borrower characteristics. The
Fund may invest in mortgage pools that include subprime mortgages, which are
loans made to borrowers with weakened credit histories or with lower capacity
to make timely payments on their mortgages. Liquidity risk is even
greater for mortgage pools that include subprime mortgages.
Derivatives
Risk. A derivative is an
instrument whose value depends largely on (and is derived from) the value of an
underlying security, currency, commodity, interest rate, index or other asset
(each referred to as an underlying asset). In addition to risks relating to the
underlying assets, the use of derivatives may include other, possibly greater,
risks, which are described below.
◾
Counterparty
Risk. Certain
derivatives do not trade on an established exchange (referred to as
over-the-counter (OTC) derivatives) and are simply financial contracts between
the Fund and
8 Invesco
V.I. Global Real Estate Fund
a counterparty.
When the Fund is owed money on an OTC derivative, the Fund is dependent on the
counterparty to pay or, in some cases, deliver the underlying asset, unless the
Fund can otherwise sell its derivative contract to a third party prior to its
expiration. Many counterparties are financial institutions such as banks and
broker-dealers and their creditworthiness (and ability to pay or perform) may be
negatively impacted by factors affecting financial institutions generally. In
addition, in the event that a counterparty becomes bankrupt or insolvent, the
Fund’s ability to recover the collateral that the Fund has on deposit with the
counterparty could be delayed or impaired. For derivatives traded on a
centralized exchange, the Fund generally is dependent upon the solvency of the
relevant exchange clearing house (which acts as a guarantor for each contractual
obligation under such derivatives) for payment on derivative instruments for
which the Fund is owed money.
◾
Leverage
Risk. Many derivatives
do not require a payment up front equal to the economic exposure created by
holding a position in the derivative, which creates a form of leverage. As a
result, an adverse change in the value of the underlying asset could result in
the Fund sustaining a loss that is substantially greater than the amount
invested in the derivative or the anticipated value of the underlying asset. In
addition, some derivatives have the potential for unlimited loss, regardless of
the size of the Fund’s initial investment. Leverage may therefore make the
Fund’s returns more volatile and increase the risk of loss. In certain market
conditions, losses on derivative instruments can grow larger while the value of
the Fund’s other assets fall, resulting in the Fund’s derivative positions
becoming a larger percentage of the Fund’s investments.
◾
Liquidity
Risk. There is a smaller
pool of buyers and sellers for certain derivatives, particularly OTC
derivatives, than more traditional investments such as stocks. These buyers and
sellers are often financial institutions that may be unable or unwilling to buy
or sell derivatives during times of financial or market stress. Derivative
instruments may therefore be less liquid than more traditional investments and
the Fund may be unable to sell or exit its derivative positions at a desirable
time or price. This risk may be more acute under adverse market conditions,
during which the Fund may be most in need of liquidating its derivative
positions. To the extent that the Fund is unable to exit a derivative position
because of market illiquidity, the Fund may not be able to prevent further
losses of value in its derivatives holdings and the liquidity of the Fund and
its ability to meet redemption requests may be impaired to the extent that a
substantial portion of the Fund’s otherwise liquid assets must be used as
margin. Another consequence of illiquidity is that the Fund may be required to
hold a derivative instrument to maturity and take or make delivery of the
underlying asset that the Adviser would otherwise avoid.
◾
Other
Risks. Compared to other
types of investments, derivatives may be harder to value and may also be less
tax efficient. In addition, changes in government regulation of derivative
instruments could affect the character, timing and amount of the Fund’s taxable
income or gains, and may limit or prevent the Fund from using certain types of
derivative instruments as a part of its investment strategy, which could make
the investment strategy more costly to implement or require the Fund to change
its investment strategy. Derivatives strategies may not always be
successful. For example, to the extent that the Fund uses derivatives for
hedging or to gain or limit exposure to a particular market or market segment,
there may be imperfect correlation between the value of the derivative
instrument and the value of the instrument being hedged or the relevant market
or market segment, in which case the Fund may not realize the intended benefits.
There is also the risk that during adverse market conditions, an instrument
which would usually operate as a hedge provides no
hedging benefits at
all. The Fund’s use of derivatives may be limited by the requirements for
taxation of the Fund as a regulated investment company.
Short
Position Risk. The Fund will
incur a loss on a short position if the price of the asset sold short increases
from the short sale price. Because the Fund’s potential loss on a short position
arises from increases in the value of the asset sold short, the extent of such
loss, like the price of the asset sold short, is theoretically unlimited. Short
sales are speculative transactions and involve greater reliance on the Adviser’s
ability to accurately anticipate the future value of an asset or markets in
general. Any gain on a short position is decreased, and any loss is increased,
by the amount of any payment, dividend, interest or other transaction costs that
the Fund may be required to pay with respect to the asset sold short. The
counterparty to a short position or market factors, such as a sharp increase in
prices, may prevent the Fund from closing out a short position at a desirable
time or price and may reduce or eliminate any gain or result in a loss. In a
rising market, the Fund’s short positions will cause the Fund to underperform
the overall market and its peers that do not engage in shorting. If the Fund
holds both long and short positions, both positions may decline simultaneously,
in which case the short positions will not provide any buffer (hedge) from
declines in value of the Fund’s long positions. Certain types of short positions
involve leverage, which may exaggerate any losses, potentially more than the
actual cost of the investment, and will increase the volatility of the Fund’s
returns.
Environmental,
Social
and Governance
(ESG)
Considerations Risk. The ESG
considerations that may be assessed as part of the investment process to
implement the Fund’s investment strategy in pursuit of its investment objective
may vary across types of investments and issuers eligible for investment, and
not every ESG factor may be identified or evaluated for every investment, and
not every investment or issuer may be evaluated for ESG considerations. The
Fund’s portfolio will not be solely based on ESG considerations,
and
therefore the issuers in which the Fund invests may not be considered
ESG-focused issuers. The incorporation of ESG factors may affect the Fund’s
exposure to
certain issuers or
industries and may not work as intended.
The
Fund may underperform other funds that do not assess an issuer’s ESG factors as
part of the investment process or that use a different methodology to identify
and/or incorporate ESG factors. As investors can differ in their views regarding
ESG factors, the Fund may invest in issuers that do not reflect the views with
respect to ESG of any particular investor. Information used by the Fund to
evaluate such factors may not be readily available, complete or accurate, and
may vary across providers and issuers as ESG is not a uniformly defined
characteristic, which could negatively impact the Fund’s ability to accurately
assess a company, which could negatively impact the Fund’s performance. There is
no guarantee that the evaluation of ESG considerations will be additive to the
Fund’s performance.
Management
Risk. The Fund is
actively managed and depends heavily on the Adviser’s judgment about markets,
interest rates or the attractiveness, relative values, liquidity, or potential
appreciation of particular investments made for the Fund’s portfolio. The Fund
could experience losses if these judgments prove to be incorrect. There can be
no guarantee that the Adviser’s investment techniques or investment decisions
will produce the desired results. Additionally, legislative, regulatory, or tax
developments may affect the investments or investment strategies available to
the Adviser in connection with managing the Fund, which may also adversely
affect the ability of the Fund to achieve its investment objective.
Portfolio
Holdings
A description of
Fund policies and procedures with respect to the disclosure of Fund portfolio
holdings is available in the SAI, which is available at
www.invesco.com/us.
9 Invesco
V.I. Global Real Estate Fund
Fund Management
The
Adviser(s)
Invesco serves as
the Fund’s investment adviser. The Adviser manages the investment operations of
the Fund as well as other investment portfolios that encompass a broad range of
investment objectives, and has agreed to perform or arrange for the performance
of the Fund’s day-to-day management. The Adviser is located at 1331 Spring
Street, N.W., Suite 2500, Atlanta, Georgia 30309. The Adviser, as successor in
interest to multiple investment advisers, has been an investment adviser since
1976.
Sub-Advisers.
Invesco Asset
Management Limited (Invesco Asset Management) serves as the Fund’s investment
sub-adviser. Invesco Asset Management, an affiliate of the Adviser, is located
at Perpetual Park, Perpetual Park Drive, Henley-on-Thames, Oxfordshire, RG9 1HH,
United Kingdom. Invesco Asset Management has been managing assets on behalf of
consumers, institutional clients and institutional professionals through a broad
product range, including investment companies with variable capital, investment
trusts, individual savings accounts, pension funds, offshore funds and other
specialist mandates since 1969, the year Invesco Asset Management was
incorporated. Invesco Asset Management provides portfolio management services to
the Fund.
In
addition, Invesco has entered into one or more Sub-Advisory Agreements with
certain affiliates to serve as sub-advisers to the Fund (the Sub-Advisers).
Invesco may appoint the Sub-Advisers from time to time to provide discretionary
investment management services, investment advice, and/or order execution
services to the Fund. The Sub-Advisers and the Sub-Advisory Agreements are
described in the SAI.
Exclusion
of Adviser from Commodity Pool Operator Definition
With respect to the
Fund, the Adviser has claimed an exclusion from the definition of “commodity
pool operator” (CPO) under the Commodity Exchange Act (CEA) and the rules of the
Commodity Futures Trading Commission (CFTC) and, therefore, is not subject to
CFTC registration or regulation as a CPO. In addition, the Adviser is relying
upon a related exclusion from the definition of “commodity trading advisor”
(CTA) under the CEA and the rules of the CFTC with respect to the
Fund.
The
terms of the CPO exclusion require the Fund, among other things, to adhere to
certain limits on its investments in “commodity interests.” Commodity interests
include commodity futures, commodity options and swaps, which in turn include
non-deliverable forwards. The Fund is permitted to invest in these instruments
as further described in the Fund’s SAI. However, the Fund is not intended as a
vehicle for trading in the commodity futures, commodity options or swaps
markets. The CFTC has neither reviewed nor approved the Adviser’s reliance on
these exclusions, or the Fund, its investment strategies or this
prospectus.
Adviser
Compensation
During the fiscal
year ended December 31, 2022, the Adviser received compensation of 0.75% of
the Fund's average daily net assets, after fee waiver and/or expense
reimbursement, if any.
Invesco,
not the Fund, pays sub-advisory fees, if any.
A
discussion regarding the basis for the Board’s approval of the investment advisory
agreement and investment sub-advisory agreements of the Fund is available in the
Fund’s most recent annual or semi-annual report to shareholders.
Portfolio
Managers
Investment
management decisions for the Fund are made by the investment management teams at
Invesco and Invesco Asset Management.
The
following individuals are jointly and primarily responsible for the day-to-day
management of the Fund’s portfolio:
◾
James Cowen,
Portfolio Manager, who has been responsible for the Fund since 2008. Mr. Cowen
previously managed the Fund from January 2006
to January 2007,
and has been a member of Invesco's Real Estate Team since 2001. Mr. Cowen has
been associated with Invesco Asset Management and/or its affiliates since
2001.
◾
Grant Jackson, CFA,
Portfolio Manager, who has been responsible for the Fund since 2018 and has been
associated with Invesco and/or its affiliates since 2005.
◾
Chip McKinley,
Portfolio Manager, who has been responsible for the Fund since 2022 and has been
associated with Invesco and/or its affiliates since 2022. From 2019 to 2022, he
was associated with Saepio Capital Management where he was the Founder and
served as Portfolio Manager. From 2007 to 2019, he was associated with Cohen and
Steers Capital Management where he served as Senior Vice President and Portfolio
Manager.
◾
Darin Turner,
Portfolio Manager, who has been responsible for the Fund since 2010 and has been
associated with Invesco and/or its affiliates since 2005.
◾
Ping-Ying Wang,
CFA, Portfolio Manager, who has been responsible for the Fund since 2006 and has
been associated with Invesco and/or its affiliates since
1998.
More
information on the portfolio managers may be found at www.invesco.com/us.
The website is not part of this prospectus.
The
Fund's SAI provides additional information about the portfolio managers’
investments in the Fund, a description of the compensation structure and
information regarding other accounts managed.
Other Information
Purchase
and Redemption of Shares
The Fund ordinarily
effects orders to purchase and redeem shares at the Fund’s next computed net
asset value (NAV) after it receives an order. Insurance companies participating
in the Fund serve as the Fund’s designee for receiving orders of separate
accounts that invest in the Fund. The Fund may postpone the right of redemption
only under unusual circumstances, as allowed by the SEC, such as when the New
York Stock Exchange (NYSE) restricts or suspends trading.
Although
the Fund generally intends to pay redemption proceeds solely in cash, the Fund
reserves the right to determine, in its sole discretion, whether to satisfy
redemption requests by making payment in securities or other property (known as
a redemption in kind). Redemptions in kind may result in transaction costs
and/or market fluctuations associated with liquidating or holding the
securities, respectively.
Shares
of the Fund are offered in connection with mixed and shared funding, i.e., to
separate accounts of affiliated and unaffiliated insurance companies funding
variable products. The Fund currently offers shares only to insurance company
separate accounts and funds of funds. In the future, the Fund may offer them to
pension and retirement plans that qualify for special federal income tax
treatment. Due to differences in tax treatment and other considerations, the
interests of Fund shareholders, including variable product owners and plan
participants investing in the Fund (whether directly or indirectly through fund
of funds), may conflict.
Mixed
and shared funding may present certain conflicts of interest. For example, violation
of the federal tax laws by one insurance company separate account investing
directly or indirectly in a fund could cause variable products funded through
another insurance company separate account to lose their tax-deferred status,
unless remedial actions were taken. The Board will monitor for the existence of
any material conflicts and determine what action, if any, should be taken. The
Fund’s NAV could decrease if it had to sell investment securities to pay
redemption proceeds to a separate account (or plan) withdrawing because of a
conflict.
10 Invesco
V.I. Global Real Estate Fund
Redemptions
by Large Shareholders
At times, the Fund
may experience adverse effects when certain large shareholders redeem large
amounts of shares of the Fund. Large redemptions may cause the Fund to sell
portfolio securities at times when it would not otherwise do so. In addition,
these transactions may also accelerate the realization of taxable income to
shareholders (if applicable) if such sales of investments resulted in gains and
may also increase transaction costs and/or increase in the Fund’s expense ratio.
When experiencing a redemption by a large shareholder, the Fund may delay
payment of the redemption request up to seven days to provide the investment
manager with time to determine if the Fund can redeem the request-in-kind or to
consider other alternatives to lessen the harm to remaining shareholders. Under
certain circumstances, however, the Fund may be unable to delay a redemption
request, which could result in the automatic processing of a large redemption
that is detrimental to the Fund and its remaining shareholders.
Excessive
Short-Term Trading Activity Disclosure
The Fund’s
investment programs are designed to serve long-term investors and are not
designed to accommodate excessive short-term trading activity in violation of
the Fund’s policies and procedures described below. Excessive short-term trading
activity in the Fund’s shares (i.e., purchases of Fund shares followed shortly
thereafter by redemptions of such shares, or vice versa) may hurt the long-term
performance of the Fund by requiring it to maintain an excessive amount of cash
or to liquidate portfolio holdings at a disadvantageous time, thus interfering
with the efficient management of the Fund by causing it to incur increased
brokerage and administrative costs. Where excessive short-term trading activity
seeks to take advantage of arbitrage opportunities from stale prices for
portfolio securities, the value of Fund shares held by long-term investors may
be diluted. The Board has adopted policies and procedures designed to discourage
excessive short-term trading of Fund shares. The Fund may alter its policies and
procedures at any time without giving prior notice to Fund shareholders if
Invesco believes the change would be in the best interests of long-term
investors.
Pursuant
to the Fund’s policies and procedures, Invesco and certain of its corporate
affiliates (Invesco and such affiliates, collectively, the Invesco Affiliates)
currently use the following tools designed to discourage excessive short-term
trading in the Fund:
(1)
trade activity monitoring; and
(2)
the use of fair value pricing consistent with the valuation
policy
approved by the
Board and related procedures.
Each
of these tools is described in more detail below.
In
addition, restrictions designed to discourage or curtail excessive short-term trading
activity may be imposed by the insurance companies and/or their separate
accounts that invest in the Fund on behalf of variable product owners. Variable
product owners should refer to the applicable contract and related prospectus
for more details.
Trade
Activity Monitoring
To detect excessive
short-term trading activities, the Invesco Affiliates will monitor, on a daily
basis, selected aggregate purchase or redemption trade orders placed by
insurance companies and/or their separate accounts. The Invesco Affiliates will
seek to work with insurance companies to discourage variable product owners from
engaging in abusive trading practices. However, the ability of the Invesco
Affiliates to monitor trades that are placed by variable product owners is
severely if not completely limited due to the fact that the insurance companies
trade with the Fund through omnibus accounts, and maintain the exclusive
relationship with, and are responsible for maintaining the account records of,
their variable product owners. There may also be legal and technological
limitations on the ability of insurance companies to impose restrictions on the
trading practices of their variable product owners. As a result, there can be no
guarantee that the Invesco Affiliates will be able to detect or deter market
timing by variable product owners.
If,
as a result of this monitoring, the Invesco Affiliates believe that a
variable product
owner has engaged in excessive short-term trading (regardless of whether or not
the insurance company’s own trading restrictions are exceeded), the Invesco
Affiliates will seek to act in a manner that they believe is consistent with the
best interests of long-term investors, which may include taking steps such as
(1) asking the insurance company to take action to stop such activities, or
(2) refusing to process future purchases related to such activities in the
insurance company’s account with the Fund. The Invesco Affiliates will use
reasonable efforts to apply the Fund’s policies uniformly given the potential
limitations described above.
Fair
Value Pricing
Securities owned by
the Fund are to be valued at current market value if market quotations are
readily available. All other securities and assets of the Fund for which market
quotations are not readily available are to be valued at fair value determined
in good faith consistent with the valuation policy
approved by the
Board and related procedures. An effect of fair value pricing may be to reduce
the ability of frequent traders to take advantage of arbitrage opportunities
resulting from potentially “stale” prices of portfolio holdings. However, it
cannot eliminate the possibility of frequent trading.
The
price a Fund could receive upon the sale of any investment may differ from the
Adviser's valuation of the investment, particularly for securities that are
valued using a fair valuation technique. When fair valuation techniques are
applied, the Adviser uses available information, including both observable and
unobservable inputs and assumptions (i.e., publicly traded company multiples,
growth rate, time to exit), to determine a methodology that will result in a
valuation that the Adviser believes approximates market value. Fund securities
that are fair valued may be subject to greater fluctuation in their value from
one day to the next than would be the case if market quotations were used.
Because of the inherent uncertainties of valuation, and the degree of
subjectivity in such decisions, the Fund could realize a greater or lesser than
expected gain or loss upon the sale of the investment.
See
“Pricing of Shares—Determination of Net Asset Value (NAV)” for more
information.
Risks
There is the risk
that the Fund’s policies and procedures will prove ineffective in whole or in
part to detect or prevent excessive short-term trading. Although these policies
and procedures, including the tools described above, are designed to discourage
excessive short-term trading, they do not eliminate the possibility that
excessive short-term trading activity in the Fund will occur. Moreover, each of
these tools involves judgments that are inherently subjective. The Invesco
Affiliates seek to make these judgments to the best of their abilities in a
manner that they believe is consistent with the best interests of long-term
investors. However, there can be no assurance that the Invesco Affiliates will
be able to gain access to any or all of the information necessary to detect or
prevent excessive short-term trading by a variable product owner. While the
Invesco Affiliates and the Fund may seek to take actions with the assistance of
the insurance companies that invest in the Fund, there is the risk that neither
the Invesco Affiliates nor the Fund will be successful in their efforts to
minimize or eliminate such activity.
Pricing
of Shares
Determination
of Net Asset Value (NAV)
The price of the
Fund’s shares is the Fund’s NAV per share. The Fund values portfolio securities
for which market quotations are readily available at market value. Securities
and other assets quoted in foreign currencies are valued in U.S. dollars based
on the prevailing exchange rates on that day. The Fund values securities and
assets for which market quotations are unavailable at their “fair value,” which
is described below.
Even
when market quotations are available, they may be stale or not representative
of market value in the Adviser’s judgment (“unreliable”)
because the
security is not traded frequently, trading on the security ceased
11 Invesco
V.I. Global Real Estate Fund
before the close of
the trading market or issuer specific events occurred after the security ceased
trading or because of the passage of time between the close of the market on
which the security trades and the close of the NYSE and when the Fund calculates
its NAV. Issuer specific events may cause the last market quotation to be
unreliable. Such events may include a merger or insolvency, events that affect a
geographical area or an industry segment, such as political events or natural
disasters, or market events, such as a significant movement in the U.S. market.
Where the Adviser determines that the closing price of the security is stale or
unreliable, the Adviser will value the security at its fair value.
A
fair value price is an estimated price that requires consideration of all
appropriate
factors, including indications of fair value available from pricing services.
Fair value pricing involves judgment and a fund that uses fair value
methodologies may value securities higher or lower than another fund using
market quotations or its own fair value methodologies to price the same
securities. Investors who purchase or redeem Fund shares on days when the Fund
is holding fair-valued securities may receive a greater or lesser number of
shares, or higher or lower redemption proceeds, than they would have received if
the Fund had not fair-valued the security or had used a different
methodology.
The
Board has designated the
Adviser to perform the daily determination of fair value prices in accordance
with Board approved
policies and
related procedures,
subject to the
Board’s oversight. Fair value pricing methods and pricing services can change
from time to time.
The
intended effect of applying fair value pricing is to compute a NAV that accurately
reflects the value of the Fund's portfolio at the time that the NAV is
calculated. An additional intended effect is to discourage those seeking to take
advantage of arbitrage opportunities resulting from “stale” prices and to
mitigate the dilutive impact of any such arbitrage. However, the application of
fair value pricing cannot eliminate the possibility that arbitrage opportunities
will exist.
Specific
types of securities are valued as follows:
Senior
Secured Floating Rate Loans and Senior Secured Floating Rate Debt
Securities. Senior secured
floating rate loans and senior secured floating rate debt securities are fair
valued using evaluated quotes provided by an independent pricing service.
Evaluated quotes provided by the pricing service may reflect appropriate factors
such as market quotes, ratings, tranche type, industry, company performance,
spread, individual trading characteristics, institution-size trading in similar
groups of securities and other market data.
Domestic
Exchange Traded Equity Securities. Market quotations
are generally available and reliable for domestic exchange traded equity
securities. If market quotations are not available or are unreliable, the
Adviser will value the security at fair value in good faith using the valuation
policy approved by the Board and related procedures.
Foreign
Securities. If market
quotations are available and reliable for foreign exchange traded equity
securities, the securities will be valued at the market quotations. Because
trading hours for certain foreign securities end before the close of the NYSE,
closing market quotations may become unreliable. If between the time trading
ends on a particular security and the close of the customary trading session on
the NYSE events occur that are significant and may make the closing price
unreliable, the Fund may fair value the security. If an issuer specific event
has occurred that the Adviser determines, in its judgment, is likely to have
affected the closing price of a foreign security, it will price the security at
fair value. The Adviser also relies on a screening process from a pricing vendor
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
market value as of the close of the NYSE. For foreign securities where the
Adviser believes, at the approved degree of certainty, that the price is not
reflective of current market value, the Adviser will use the indication of fair
value from the pricing service to determine the fair value of the security. The
pricing vendor, pricing methodology or degree of certainty may change from time
to time. Fund securities primarily traded on foreign markets may trade on days
that are
not business days
of the Fund. Because the NAV of Fund shares is determined only on business days
of the Fund, the value of foreign securities included in the Fund’s portfolio
may change on days when the separate account to which you have allocated
variable product values will not be able to purchase or redeem shares of the
Fund.
Fixed
Income Securities. Fixed income
securities, such as government, corporate, asset-backed and municipal bonds and
convertible securities, including high yield or junk bonds, and loans, generally
are valued on the basis of prices provided by independent pricing services.
Prices provided by the pricing services 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 special securities, dividend rate, maturity and other market data. Pricing
services generally value fixed income securities 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. Prices received from pricing services are fair value
prices. In addition, if the price provided by the pricing service and
independent quoted prices are unreliable, the Adviser will fair value the
security using the valuation policy approved by the Board and related
procedures.
Short-term
Securities. The Fund’s
short-term investments are valued at amortized cost when the security has
60 days or less to maturity.
Futures
and Options. Futures contracts
are valued at the final settlement price set by the exchange on which they are
principally traded. U.S.
exchange-traded
options are valued at the mean between the last bid and asked prices from the
exchange on which they principally trade. Non-U.S. exchange-traded options are
valued at the final settlement price set
by the
exchange on which they trade. Options not listed on an exchange and swaps
generally are valued using pricing provided from independent pricing
services.
Swap
Agreements. Swap agreements
are fair valued using an evaluated quote provided by an independent pricing
service. Evaluated quotes provided by the pricing service are based on a model
that may include end of day net present values, spreads, ratings, industry and
company performance.
Open-end
Funds.
If the Fund invests in other open-end funds, other than open-end funds that are
exchange traded, the investing Fund will calculate its NAV using the NAV of the
underlying fund in which it invests. The Fund discloses portfolio holdings at
different times to insurance companies issuing variable products that invest in
the Fund, and in annual and semi-annual shareholder reports. Refer to such
reports to determine the types of securities in which the Fund has invested. You
may also refer to the SAI to determine what types of securities in which the
Fund may invest. You may obtain copies of these reports or of the SAI from the
insurance company that issued your variable product, or from the Adviser as
described on the back cover of this prospectus.
The
Fund generally determines the net asset value of its shares on each day the NYSE is
open for trading (a business day) as of approximately 4:00 p.m. Eastern Time
(the customary close of regular trading) or earlier in the case of a scheduled
early close. In the event of an unscheduled early close of the NYSE, the Fund
generally still will determine the net asset value of its shares as of 4:00 p.m.
Eastern Time on that business day. Portfolio securities traded on the NYSE would
be valued at their closing prices unless the Adviser determines that a “fair
value” adjustment is appropriate due to subsequent events occurring after an
early close consistent with the valuation policy approved by the Board and
related procedures.
Taxes
The Fund intends to
qualify each year as a regulated investment company and, as such, is not subject
to entity-level tax on the income and gain it distributes to shareholders.
Insurance company separate accounts may invest in the Fund and, in turn, may
offer variable products to investors through insurance contracts. Because the
insurance company separate accounts generally are the shareholders in the Fund,
all of the tax
12 Invesco
V.I. Global Real Estate Fund
characteristics of
the Fund’s investments flow into the separate accounts and not to each variable
product owner. The tax consequences from each variable product owner’s
investment in a variable product contract will depend upon the provisions of
these contracts, and variable product owners should consult their contract
prospectus for more information on these tax consequences.
Dividends
and Distributions
The Fund expects,
based on its investment objective and strategies, that its distributions, if
any, will consist of ordinary income, capital gains, or some combination of
both.
Dividends
The Fund generally
declares and pays dividends from net investment income, if any,
annually.
Capital
Gains Distributions
The Fund generally
distributes long-term and short-term capital gains (net of any available capital
loss carryovers), if any, at least annually. Capital gains distributions may
vary considerably from year to year as a result of the Fund’s normal investment
activities and cash flows.
Share
Classes
The Fund has two
classes of shares, Series I shares and Series II shares. Each class is
identical except that Series II shares have a distribution or
“Rule 12b-1 Plan” that is described below.
Distribution
Plan
The Fund has
adopted a distribution or “Rule 12b-1 Plan” for its Series II shares. The plan
allows the Fund to pay distribution fees to life insurance companies and others
to promote the sale and distribution of Series II shares. The plan provides for
a maximum fee equal to an annual rate of 0.25% (expressed as a percentage of
average daily net assets of the Fund). Because the Fund pays these fees out of
its assets on an ongoing basis, over time these fees will increase the cost of
your investment and may cost you more than paying other types of
charges.
Payments
to Insurance Companies
The insurance
company that issued your variable product, or one of its affiliates, may receive
all the Rule 12b-1 distribution fees discussed above. In addition to those
payments, Invesco Distributors, Inc., the distributor of the Fund and an Invesco
Affiliate, and other Invesco Affiliates may make cash payments to the insurance
company that issued your variable product or the insurance company’s affiliates
in connection with promotion of the Fund and certain other marketing support
services. Invesco Affiliates make these payments from their own resources.
Invesco Affiliates make these payments as incentives to certain insurance
companies or their affiliates to promote the sale and retention of shares of the
Fund. The benefits Invesco Affiliates receive when they make these payments may
include, among other things, adding the Fund to the list of underlying
investment options in the insurance company’s variable products, and access (in
some cases on a preferential basis over other competitors) to individual members
of an insurance company’s sales force or to an insurance company’s management.
These payments are sometimes referred to as “shelf space” payments because the
payments compensate the insurance company for including the Fund in its variable
products (on its “sales shelf”). Invesco Affiliates may also make payments to
insurance company affiliates for support, training and ongoing education for
sales personnel about the Fund, financial planning needs of Fund shareholders or
contract owners that allocate contract value directly or indirectly to the Fund,
marketing and advertising of the Fund, and access to periodic conferences held
by insurance company affiliates relating directly or indirectly to the Fund.
Invesco Affiliates compensate insurance companies or their affiliates
differently depending typically on the level and/or type of services provided by
the insurance companies or their affiliates. The payments Invesco Affiliates
make may be calculated on sales of shares of the Fund (Sales-Based Payments), in
which case the total amount of such payments
shall not exceed
0.25% of the offering price of all shares sold through variable products during
the particular period. Such payments also may be calculated on the average daily
net assets of the Fund attributable to that particular insurance company or its
affiliates (Asset-Based Payments), in which case the total amount of such cash
payments shall not exceed 0.25% per annum of those assets during a defined
period. Sales-Based Payments primarily create incentives to make sales of shares
of the Fund and Asset-Based Payments primarily create incentives to retain
assets of the Fund in insurance company separate accounts or funds of
funds.
Invesco
Affiliates are motivated to make the payments described above in order to promote
the sale of Fund shares and the retention of those investments by clients of
insurance companies. To the extent insurance companies sell more shares of the
Fund or retain shares of the Fund in their variable product owners’ accounts,
Invesco Affiliates may directly or indirectly benefit from the incremental
management and other fees paid to Invesco Affiliates by the Fund with respect to
those assets.
In
addition to the payments listed above, Invesco may also make payments to
insurance companies for certain administrative services provided to the Fund.
These services may include, but are not limited to, maintenance of master
accounts with the Fund; tracking, recording and transmitting net purchase and
redemption orders for Fund shares; distributing redemption proceeds and
transmitting net purchase payments; reconciling purchase and redemption activity
and dividend and distribution payments between a master account and the Fund;
maintaining and preserving records related to the purchase, redemption and other
account activity of variable product owners; distributing copies of Fund
documents, such as prospectuses, proxy materials and periodic reports, to
variable product owners; assisting with proxy solicitations on behalf of the
Fund, including soliciting and compiling voting instructions from variable
contract owners; and responding to inquiries from variable contract owners about
the Fund. The Fund has agreed to reimburse Invesco for its payments made to
Insurance Companies to provide these services, up to an annual limit of 0.15% of
the average daily net assets invested in the Fund by each insurance company. Any
amounts paid by Invesco to an insurance company in excess of 0.15% of the
average daily net assets invested in the Fund are paid by Invesco out of its own
financial resources, and not out of the Fund’s assets. Insurance companies may
earn profits on these payments for these services, since the amount of the
payments may exceed the cost of providing the service.
You
can find further details in the SAI about these payments and the services provided
by insurance companies or their affiliates. In certain cases these payments
could be significant to the insurance company or its affiliates. Your insurance
company may charge you additional fees or commissions on your variable product
other than those disclosed in this prospectus. You can ask your insurance
company about any payments it or its affiliates receive from Invesco Affiliates,
or the Fund, as well as about fees and/or commissions it charges. The prospectus
for your variable product may also contain additional information about these
payments.
13 Invesco
V.I. Global Real Estate Fund
Financial Highlights
The financial
highlights show the Fund’s financial history for the past five fiscal years or,
if shorter, the period of operations of the Fund or any of its share classes.
The financial highlights table is intended to help you understand the Fund’s
financial performance. Certain information reflects financial results for a
single Fund share.
The
total returns in the table represent the rate that an investor would
have
earned (or lost) on an investment in the Fund (assuming reinvestment of all
dividends and distributions).
This
information has been audited by PricewaterhouseCoopers LLP, an independent
registered public accounting firm, whose report, along with the Fund’s financial
statements, is included in the Fund’s annual report, which is available upon
request.
|
|
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)
|
|
Series
I | ||||||||||||||
|
Year
ended 12/31/22 |
$17.99 |
$0.25 |
$(4.76) |
$(4.51) |
$(0.44) |
$— |
$(0.44) |
$13.04 |
(24.94)% |
$83,608 |
1.02% |
1.02% |
1.65% |
82% |
|
Year
ended 12/31/21 |
14.69 |
0.25 |
3.51 |
3.76 |
(0.46) |
— |
(0.46) |
17.99 |
25.71 |
116,762 |
0.97 |
0.97 |
1.51 |
95 |
|
Year
ended 12/31/20 |
18.22 |
0.28 |
(2.61) |
(2.33) |
(0.77) |
(0.43) |
(1.20) |
14.69 |
(12.32) |
119,114 |
1.04 |
1.04 |
1.86 |
154 |
|
Year
ended 12/31/19 |
15.52 |
0.39 |
3.15 |
3.54 |
(0.82) |
(0.02) |
(0.84) |
18.22 |
23.00 |
150,255 |
1.04 |
1.04 |
2.22 |
61 |
|
Year
ended 12/31/18 |
17.38 |
0.40 |
(1.41) |
(1.01) |
(0.65) |
(0.20) |
(0.85) |
15.52 |
(6.10) |
124,816 |
1.01 |
1.01 |
2.38 |
57 |
|
| ||||||||||||||
|
Series
II | ||||||||||||||
|
Year
ended 12/31/22 |
17.53 |
0.21 |
(4.64) |
(4.43) |
(0.38) |
— |
(0.38) |
12.72 |
(25.14) |
22,317 |
1.27 |
1.27 |
1.40 |
82 |
|
Year
ended 12/31/21 |
14.33 |
0.20 |
3.43 |
3.63 |
(0.43) |
— |
(0.43) |
17.53 |
25.44 |
42,896 |
1.22 |
1.22 |
1.26 |
95 |
|
Year
ended 12/31/20 |
17.78 |
0.24 |
(2.55) |
(2.31) |
(0.71) |
(0.43) |
(1.14) |
14.33 |
(12.56) |
35,111 |
1.29 |
1.29 |
1.61 |
154 |
|
Year
ended 12/31/19 |
15.03 |
0.34 |
3.04 |
3.38 |
(0.61) |
(0.02) |
(0.63) |
17.78 |
22.65 |
45,233 |
1.29 |
1.29 |
1.97 |
61 |
|
Year
ended 12/31/18 |
16.86 |
0.34 |
(1.35) |
(1.01) |
(0.62) |
(0.20) |
(0.82) |
15.03 |
(6.33) |
26,799 |
1.26 |
1.26 |
2.13 |
57 |
|
| ||||||||||||||
|
(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. Total returns are not annualized for
periods less than one year, if applicable, and do
not
reflect charges assessed in connection with a variable product, which if
included would reduce total returns. |
|
(c) |
Portfolio
turnover is calculated at the fund level and is not annualized for periods
less than one year, if
applicable. |
14 Invesco
V.I. Global Real Estate Fund
Hypothetical Investment and Expense Information
In connection with
the final settlement reached between Invesco and certain of its affiliates with
certain regulators, including the New York Attorney General’s Office, the SEC
and the Colorado Attorney General’s Office (the settlement) arising out of
certain market timing and unfair pricing allegations made against Invesco and
certain of its affiliates, Invesco and certain of its affiliates agreed, among
other things, to disclose certain hypothetical information regarding investment
and expense information to Fund shareholders. The chart below is intended to
reflect the annual and cumulative impact of the Fund’s expenses, including
investment advisory fees and other Fund costs, on the Fund’s returns over a
10-year period. The example reflects the following:
◾
You invest $10,000
in the Fund and hold it for the entire 10-year period;
◾
Your investment has
a 5% return before expenses each year; and
◾
The Fund’s current
annual expense ratio includes any applicable contractual fee waiver or expense
reimbursement for the period committed.
There
is no assurance that the annual expense ratio will be the expense ratio for the
Fund’s classes for any of the years shown. The chart does not take into account
any fees or other expenses assessed in connection with your variable product; if
it did, the expenses shown would be higher, while the ending balance shown would
be lower. This is only a hypothetical presentation made to illustrate what
expenses and returns would be under the above scenarios; your actual returns and
expenses are likely to differ (higher or lower) from those shown
below.
|
Series
I |
Year
1 |
Year
2 |
Year
3 |
Year
4 |
Year
5 |
Year
6 |
Year
7 |
Year
8 |
Year
9 |
Year
10 |
|
Annual
Expense Ratio1 |
1.02% |
1.02% |
1.02% |
1.02% |
1.02% |
1.02% |
1.02% |
1.02% |
1.02% |
1.02% |
|
Cumulative
Return Before Expenses |
5.00% |
10.25% |
15.76% |
21.55% |
27.63% |
34.01% |
40.71% |
47.75% |
55.13% |
62.89% |
|
Cumulative
Return After Expenses |
3.98% |
8.12% |
12.42% |
16.90% |
21.55% |
26.39% |
31.42% |
36.65% |
42.09% |
47.74% |
|
End
of Year Balance |
$10,398.00 |
$10,811.84 |
$11,242.15 |
$11,689.59 |
$12,154.83 |
$12,638.60 |
$13,141.61 |
$13,664.65 |
$14,208.50 |
$14,774.00 |
|
Estimated
Annual Expenses |
$104.03 |
$108.17 |
$112.48 |
$116.95 |
$121.61 |
$126.45 |
$131.48 |
$136.71 |
$142.15 |
$147.81 |
|
| ||||||||||
|
Series
II |
Year
1 |
Year
2 |
Year
3 |
Year
4 |
Year
5 |
Year
6 |
Year
7 |
Year
8 |
Year
9 |
Year
10 |
|
Annual
Expense Ratio1 |
1.27% |
1.27% |
1.27% |
1.27% |
1.27% |
1.27% |
1.27% |
1.27% |
1.27% |
1.27% |
|
Cumulative
Return Before Expenses |
5.00% |
10.25% |
15.76% |
21.55% |
27.63% |
34.01% |
40.71% |
47.75% |
55.13% |
62.89% |
|
Cumulative
Return After Expenses |
3.73% |
7.60% |
11.61% |
15.78% |
20.09% |
24.57% |
29.22% |
34.04% |
39.04% |
44.23% |
|
End
of Year Balance |
$10,373.00 |
$10,759.91 |
$11,161.26 |
$11,577.57 |
$12,009.42 |
$12,457.37 |
$12,922.03 |
$13,404.02 |
$13,903.99 |
$14,422.61 |
|
Estimated
Annual Expenses |
$129.37 |
$134.19 |
$139.20 |
$144.39 |
$149.78 |
$155.36 |
$161.16 |
$167.17 |
$173.41 |
$179.87 |
|
| ||||||||||
1
Your actual
expenses may be higher or lower than those shown.
15 Invesco
V.I. Global Real Estate Fund
Obtaining Additional Information
More information
may be obtained free of charge upon request. The SAI, a current version of which
is on file with the SEC, contains more details about the Fund and is
incorporated by reference into this prospectus (is legally a part of this
prospectus). Annual and semi-annual reports to shareholders contain additional
information about the Fund’s investments. The Fund’s annual report also
discusses the market conditions and investment strategies that significantly
affected the Fund’s performance during its last fiscal year. The Fund also files
its complete schedule of portfolio holdings with the SEC for the 1st and 3rd
quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The
Fund’s most recent portfolio holdings, as filed on Form N-PORT, will also be
made available to insurance companies issuing variable products that invest in
the Fund.
If you have
questions about an Invesco Fund, or you wish to obtain a free copy of the Fund’s
current SAI, annual or semi-annual reports, or Form N-PORT, please contact the
insurance company that issued your variable product, or you may contact
us.
|
By
Mail: |
Invesco
Distributors, Inc.
P.O.
Box 219078
Kansas
City, MO 64121-9078 |
|
By
Telephone: |
(800)
959-4246 |
|
On
the Internet: |
You
can send us a request by e-mail or
download
prospectuses, SAIs, annual or
semi-annual
reports via our website:
www.invesco.com/us |
Reports and other
information about the Fund are available on the EDGAR Database on the SEC’s
Internet site at http://www.sec.gov, and copies of this information may be
obtained, after paying a duplicating fee, by electronic request at the following
e-mail address: [email protected].
|
Invesco
V.I. Global Real Estate Fund
SEC 1940 Act file
number: 811-07452 |
|
invesco.com/us |
VIGRE-PRO-1 |