LOGO

                      

Invesco Annual Report to Shareholders

October 31, 2022

PIN       Invesco India ETF


Table of Contents

The Market Environment      3  
Management’s Discussion of Fund Performance      4  
Schedule of Investments      6  
Statement of Assets and Liabilities      9  
Statement of Operations      10  
Statement of Changes in Net Assets      11  
Financial Highlights      12  
Notes to Financial Statements      13  
Report of Independent Registered Public Accounting Firm      21  
Fund Expenses      22  
Tax Information      23  
Trustees and Officers      24  

  2  


The Market Environment

Global Equity

At the beginning of the fiscal year ended October 31, 2022, developed global equity markets were mostly positive, despite rising inflation and the emergence of Omicron, a new COVID-19 variant. Pandemic-related supply chain disruptions and labor shortages intensified at the end of 2021, resulting in broadly higher costs for companies and consumers. Emerging market equities declined due in part to COVID-19 concerns and China’s ongoing regulatory tightening in the private education and technology sectors and slowing economic growth.

After a dip in growth in early 2022, India saw a rebound in Gross Domestic Product (GDP) in the second quarter of 2022 and the Purchasing Managers’ Index, which is designed to provide insight into business conditions and includes individual measures of business output, remained above the neutral threshold of 50, representing growth or expansion. 1 Inflation remained a challenge in India, which led to four rate hikes by the Reserve Bank of India between May and September, 1 although inflation remains at more manageable levels than in developed markets. Indian equities have been challenged over the last year, driven largely by global struggles across emerging markets including a strong U.S. dollar and tightening monetary policy worldwide.

Global equity markets declined in the first half of 2022 amid volatility sparked by Russia’s invasion of Ukraine, rising commodity prices, rampant global inflation and central banks shifting toward tighter monetary policy. Russia’s invasion exacerbated inflationary pressures, disrupting already strained supply chains, and increasing shortages of oil, gas and raw materials, with the price of oil rising sharply.

Inflation headwinds continued into the third quarter of 2022. The US Federal Reserve (the Fed), the European Central Bank and the Bank of England all raised interest rates. In contrast, the People’s Bank of China lowered its policy rate and the Bank of Japan kept rates the same. Emerging market equities, hampered by the strong US dollar, underperformed developed market equities.

During October 2022, developed market equities rebounded and were in positive territory. Developed market equities outperformed emerging market equities, which declined primarily driven by weakness in China as Chinese markets reacted to the reappointment of President Xi and his authority, with no signs of the country’s zero-COVID-19 policy being relaxed. Despite the rebound in October for developed market equities, at the end of the fiscal year, trailing one-year returns for developed market equities and emerging market equities were both in negative territory.

1  

Source: Bloomberg LP

  3  


PIN    Management’s Discussion of Fund Performance
   Invesco India ETF (PIN)

As an index fund, the Invesco India ETF (the “Fund”) is passively managed and seeks to track the investment results (before fees and expenses) of the FTSE India Quality and Yield Select Index (the “Index”). The Fund generally will invest at least 90% of its total assets in the securities that comprise the Index, as well as American depositary receipts (“ADRs”) and global depositary receipts (“GDRs”) that represent securities in the Index.

Strictly in accordance with its guidelines and mandated procedures, FTSE International Ltd. (the “Index Provider”) compiles, maintains, and calculates the Index, which is a modified market capitalization- weighted index of equity securities that are traded on the National Stock Exchange of India Ltd. The Index Provider screens each constituent of the Index to identify those securities that exhibit relatively high yield and high quality pursuant to the Index methodology. Eligible securities ranked in the top 90% based on a company’s trailing 12-month dividend yield are included in the Index. The Index Provider also calculates each security’s quality score by evaluating each security’s: (i) profitability, which is calculated using a company’s return on assets, change in asset turnover, and accruals; and (ii) leverage, which is calculated as the ratio of operating cash flow to total debt. Eligible securities ranked in the top 90% by quality are included in the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index.

For the fiscal year ended October 31, 2022, on a market price basis, the Fund returned (7.53)%. On a net asset value (“NAV”) basis, the Fund returned (7.63)%. During the same time period, the Index returned (7.19)%. During the fiscal year, the Fund fully replicated the components of the Index; therefore, the Fund’s performance, on a NAV basis, differed from the return of the Index primarily due to fees and operating expenses the Fund incurred, partially offset by the timing of India capital gains tax with market losses.

During this same time period, the MSCI India Index (Net) (the “Benchmark Index”) returned (6.89)%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 109 securities. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a representation of the Indian equity market.

The performance of the Fund differed from the Benchmark Index in part because the Index utilizes a quality and yield selection and weighting methodology, whereas the Benchmark Index utilizes a market capitalization weighting methodology.

Relative to the Benchmark Index, the Fund was most overweight in the materials sector and most underweight in the financials sector during the fiscal year ended October 31, 2022. The majority of the Fund’s underperformance relative to the Benchmark Index during the period can be attributed to the Fund’s security selection in the utilities and financials sectors respectively.

For the fiscal year ended October 31, 2022, the industrials sector contributed most significantly to the Fund’s return, followed by the utilities sector. During the period, the information technology sector detracted most from the Fund’s return, followed by the financials sector.

Positions that contributed most significantly to the Fund’s return for the fiscal year ended October 31, 2022 included Adani Enterprises Ltd., an industrials company (no longer held at fiscal year-end), and Adani Total Gas Ltd., a utilities company (no longer held at fiscal year-end). Positions that detracted most significantly from the Fund’s return included Housing Development Finance Corp. Ltd., a financials company (portfolio average weight of 6.26%), and Infosys Ltd., an information technology company (portfolio average weight of 8.56%).

Sector Breakdown
(% of the Fund’s Net Assets)
as of October 31, 2022
 
Financials      19.55  
Information Technology      16.47  
Energy      12.51  
Materials      12.24  
Consumer Discretionary      10.66  
Consumer Staples      8.38  
Industrials      6.45  
Health Care      5.98  
Communication Services      3.77  
Utilities      3.62  
Real Estate      0.75  
Money Market Funds Plus Other Assets Less Liabilities      (0.38)  
Top Ten Fund Holdings*
(% of the Fund’s Net Assets)
as of October 31, 2022
 
Security   
Reliance Industries Ltd.      9.94  
Infosys Ltd.      7.36  
Housing Development Finance Corp. Ltd.      5.83  
Tata Consultancy Services Ltd.      4.39  
Hindustan Unilever Ltd.      3.05  
Axis Bank Ltd.      2.77  
Bharti Airtel Ltd.      2.59  
Bajaj Finance Ltd.      2.27  
ICICI Bank Ltd.      1.91  
Asian Paints Ltd.      1.89  
Total      42.00  

*

Excluding money market fund holdings, if any.

  4  


Invesco India ETF (PIN) (continued)

Growth of a $10,000 Investment

LOGO

Fund Performance History as of October 31, 2022

   

1 Year

   

3 Years

Average
Annualized

   

3 Years

Cumulative

   

5 Years

Average
Annualized

   

5 Years

Cumulative

   

10 Years

Average
Annualized

   

10 Years

Cumulative

          Fund Inception  
Index         Average
Annualized
    Cumulative  
Blended—FTSE India Quality and Yield Select Index (Net)     (7.19 )%      13.29     45.42     8.61     51.10     9.12     139.37       4.67     95.10
MSCI India Index (Net)     (6.89     10.88       36.31       7.00       40.23       7.96       115.10         4.17       82.08  
Fund                    
NAV Return     (7.63     10.16       33.67       5.95       33.48       7.17       99.93         2.70       47.77  
Market Price Return     (7.53     10.47       34.82       5.98       33.72       7.25       101.39         2.57       44.99  

Fund Inception: March 5, 2008

Performance quoted above represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate, and shares of the Fund (“Fund Shares”), when redeemed or sold, may be worth more or less than their original cost. Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See the current prospectus for more information. According to the Fund’s current prospectus, the Fund’s expense ratio of 0.78% is expressed as a unitary management fee to cover operating expenses and expenses incurred in connection with managing the portfolio. NAV and Market Price returns assume that dividends and capital gain distributions have been reinvested in the Fund at NAV and Market Price, respectively. The returns shown in the table above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund Shares. See invesco.com/ETFs to find the most recent month-end performance numbers.

Performance results for the indexes are based upon a hypothetical investment in their respective constituent securities. The returns of an index do not represent Fund returns. An investor cannot invest directly in an index. The indexes do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.

Notes Regarding Indexes and Fund Performance History:

-

Average Annualized and Cumulative Inception returns for the Fund and indexes are based on the inception date of the Fund.

-

Net returns reflect reinvested dividends net of withholding taxes.

-

The Blended-FTSE India Quality and Yield Select Index (Net) is comprised of the performance of the Indus India Index, the Fund’s previous underlying index, from Fund inception through the conversion date, June 21, 2019, followed by the performance of the Index, starting from the conversion date through October 31, 2022.

  5  


Invesco India ETF (PIN)

October 31, 2022

Schedule of Investments (a)

           Shares            Value  

Common Stocks & Other Equity Interests-100.37% (b)

 

Communication Services-3.77%

     

Bharti Airtel Ltd.

     249,483      $ 2,507,564  

Indus Towers Ltd.

     94,451        211,660  

Info Edge India Ltd.

     8,244        390,571  

Sun TV Network Ltd.

     10,630        67,142  

Tata Communications Ltd.

     12,291        186,932  

Zee Entertainment Enterprises Ltd.

     89,482        283,707  
     

 
        3,647,576  
     

 

Consumer Discretionary-10.66%

     

Bajaj Auto Ltd.

     7,493        332,375  

Balkrishna Industries Ltd.

     8,698        206,240  

Bata India Ltd.

     6,523        144,077  

Bharat Forge Ltd.

     27,162        273,728  

Bosch Ltd.

     937        186,643  

Dixon Technologies India Ltd. (c)

     3,828        208,868  

Eicher Motors Ltd.

     14,982        696,898  

Exide Industries Ltd.

     49,525        99,167  

Hero MotoCorp Ltd.

     14,093        455,738  

Indian Hotels Co. Ltd. (The)

     89,290        360,062  

Jubilant Foodworks Ltd.

     39,053        287,764  

Mahindra & Mahindra Ltd.

     99,219        1,616,463  

Maruti Suzuki India Ltd.

     14,273        1,642,807  

MRF Ltd.

     292        320,183  

Page Industries Ltd.

     619        372,164  

Relaxo Footwears Ltd.

     7,795        91,093  

Samvardhana Motherson International Ltd.

     232,801        181,398  

Sona Blw Precision Forgings Ltd. (c)

     27,911        156,924  

Titan Co. Ltd.

     44,898        1,497,820  

Trent Ltd.

     19,561        361,055  

Tube Investments of India Ltd.

     10,542        349,362  

TVS Motor Co. Ltd.

     21,543        298,262  

UNO Minda Ltd.

     18,004        116,731  

Whirlpool of India Ltd.

     3,285        62,521  
     

 
        10,318,343  
     

 

Consumer Staples-8.37%

     

Britannia Industries Ltd.

     12,830        583,792  

Colgate-Palmolive (India) Ltd.

     14,321        282,302  

Dabur India Ltd.

     62,222        416,956  

Emami Ltd.

     22,495        128,824  

Gillette India Ltd.

     844        52,433  

Hindustan Unilever Ltd.

     95,644        2,947,167  

ITC Ltd.

     319,101        1,344,212  

Marico Ltd.

     55,902        354,244  

Nestle India Ltd.

     3,873        952,764  

Tata Consumer Products Ltd.

     65,175        606,379  

United Breweries Ltd.

     7,428        148,318  

Varun Beverages Ltd.

     21,848        276,883  
     

 
        8,094,274  
     

 

Energy-12.51%

     

Bharat Petroleum Corp. Ltd.

     107,703        395,083  

Coal India Ltd.

     203,933        605,929  

Hindustan Petroleum Corp. Ltd.

     74,763        193,145  

Indian Oil Corp. Ltd.

     442,211        364,603  

Oil & Natural Gas Corp. Ltd.

     397,625        643,915  

Oil India Ltd.

     35,759        83,374  
           Shares            Value  

Energy-(continued)

     

Petronet LNG Ltd.

     80,919      $ 200,935  

Reliance Industries Ltd.

     312,211        9,616,299  
     

 
        12,103,283  
     

 

Financials-19.55%

     

AU Small Finance Bank Ltd. (c)

     35,139        250,264  

Axis Bank Ltd.

     245,174        2,683,430  

Bajaj Finance Ltd.

     25,441        2,195,682  

Bajaj Finserv Ltd.

     41,200        839,902  

Bajaj Holdings & Investment Ltd.

     2,882        231,897  

Bank of Baroda

     111,590        199,110  

Cholamandalam Investment and Finance Co. Ltd.

     43,322        371,242  

Federal Bank Ltd.

     167,906        266,735  

General Insurance Corp. of India (c)

     10,525        15,735  

HDFC Asset Management Co.
Ltd. (c)

     7,294        182,805  

HDFC Life Insurance Co. Ltd. (c)

     104,551        682,608  

Housing Development Finance Corp. Ltd.

     189,115        5,642,550  

ICICI Bank Ltd.

     168,727        1,852,221  

ICICI Lombard General Insurance Co. Ltd. (c)

     25,956        366,854  

L&T Finance Holdings Ltd.

     96,468        94,513  

LIC Housing Finance Ltd.

     35,423        173,440  

Mahindra & Mahindra Financial Services Ltd.

     63,853        155,819  

Muthoot Finance Ltd.

     11,532        145,366  

Nippon Life India Asset Management Ltd. (c)

     17,590        57,481  

Piramal Enterprises Ltd.

     13,627        139,830  

Power Finance Corp. Ltd.

     125,348        174,520  

REC Ltd.

     134,567        166,710  

SBI Cards & Payment Services Ltd.

     31,154        311,117  

Shriram Transport Finance Co. Ltd.

     21,517        319,502  

State Bank of India

     192,580        1,334,933  

Yes Bank Ltd. (d)

     316,551        59,465  
     

 
        18,913,731  
     

 

Health Care-5.98%

     

Aarti Pharmalabs Ltd. (d)(e)

     5,060        23,180  

Alkem Laboratories Ltd.

     2,653        101,124  

Apollo Hospitals Enterprise Ltd.

     10,699        583,887  

Aurobindo Pharma Ltd.

     28,600        185,933  

Biocon Ltd.

     49,000        159,737  

Cipla Ltd.

     55,145        777,703  

Divi’s Laboratories Ltd.

     13,749        599,423  

Dr Lal PathLabs Ltd. (c)

     3,760        116,421  

Dr. Reddy’s Laboratories Ltd.

     13,030        697,908  

GlaxoSmithKline Pharmaceuticals Ltd.

     4,569        76,024  

Glenmark Pharmaceuticals Ltd.

     16,261        79,471  

Ipca Laboratories Ltd.

     14,732        161,082  

Laurus Labs Ltd. (c)

     39,086        214,630  

Lupin Ltd.

     25,885        218,581  

Sun Pharmaceutical Industries Ltd.

     117,296        1,440,951  

Torrent Pharmaceuticals Ltd.

     10,500        209,296  

Zydus Lifesciences Ltd.

     27,356        143,212  
     

 
        5,788,563  
     

 

Industrials-6.45%

     

ABB India Ltd.

     5,716        210,593  

Adani Ports & Special Economic Zone Ltd.

     85,373        849,373  

Ashok Leyland Ltd.

     154,521        286,166  

Astral Ltd.

     9,594        235,412  

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

  6  

 

 


Invesco India ETF (PIN)–(continued)

October 31, 2022

           Shares            Value  

Industrials-(continued)

     

Bharat Electronics Ltd.

     352,759      $ 455,345  

Container Corp. of India Ltd.

     29,623        285,575  

Cummins India Ltd.

     14,574        237,314  

Havells India Ltd.

     25,926        380,946  

Hindustan Aeronautics Ltd. (c)

     8,965        274,010  

Indian Railway Catering & Tourism Corp. Ltd.

     28,138        251,951  

L&T Technology Services Ltd. (c)

     2,845        121,629  

Larsen & Toubro Ltd.

     74,282        1,815,468  

Polycab India Ltd.

     2,729        91,567  

Schaeffler India Ltd.

     4,361        145,122  

Siemens Ltd.

     9,605        339,469  

Voltas Ltd.

     24,737        261,841  
     

 
        6,241,781  
     

 

Information Technology-16.47%

     

Coforge Ltd.

     3,861        177,692  

HCL Technologies Ltd.

     117,070        1,472,470  

Honeywell Automation India Ltd.

     238        113,089  

Infosys Ltd.

     383,107        7,116,481  

Larsen & Toubro Infotech Ltd. (c)

     4,808        275,307  

Mindtree Ltd.

     4,649        191,163  

Mphasis Ltd.

     9,687        231,533  

Oracle Financial Services Software Ltd.

     2,469        86,881  

Persistent Systems Ltd.

     5,195        231,771  

Tata Consultancy Services Ltd.

     110,099        4,247,079  

Tata Elxsi Ltd.

     3,699        312,617  

Tech Mahindra Ltd.

     65,285        838,683  

Wipro Ltd.

     136,159        635,828  
     

 
        15,930,594  
     

 

Materials-12.24%

     

Aarti Industries Ltd.

     20,241        170,946  

ACC Ltd.

     9,188        265,315  

Ambuja Cements Ltd.

     74,014        476,528  

Asian Paints Ltd.

     48,644        1,826,232  

Bayer CropScience Ltd.

     1,385        78,278  

Berger Paints India Ltd.

     26,212        185,497  

Castrol India Ltd.

     52,292        78,522  

Coromandel International Ltd.

     11,747        136,568  

Dalmia Bharat Ltd.

     8,884        171,820  

Deepak Nitrite Ltd.

     7,992        223,407  

Grasim Industries Ltd.

     41,347        859,982  

Gujarat Fluorochemicals Ltd.

     3,748        171,647  

Hindalco Industries Ltd.

     152,079        745,261  

Hindustan Zinc Ltd.

     25,053        85,863  

Jindal Steel & Power Ltd.

     42,670        237,043  

JSW Steel Ltd.

     107,997        879,280  

Kansai Nerolac Paints Ltd.

     14,541        85,373  

Linde India Ltd.

     2,300        85,348  

NMDC Ltd.

     123,943        149,356  

Investment Abbreviations:

REIT-Real Estate Investment Trust

INR-Indian Rupee

           Shares            Value  

Materials-(continued)

     

NMDC Steel Ltd. (d)(e)

     123,943      $ 57,646  

PI Industries Ltd.

     7,867        308,108  

Pidilite Industries Ltd.

     16,402        512,088  

Shree Cement Ltd.

     1,458        400,539  

SRF Ltd.

     15,247        471,284  

Steel Authority of India Ltd.

     155,992        148,308  

Tata Steel Ltd.

     878,656        1,077,920  

UltraTech Cement Ltd.

     12,343        1,001,270  

UPL Ltd.

     56,851        501,496  

Vedanta Ltd.

     132,212        448,493  
     

 
        11,839,418  
     

 

Real Estate-0.75%

     

DLF Ltd.

     66,902        311,567  

Embassy Office Parks REIT

     65,830        273,873  

Oberoi Realty Ltd.

     12,670        141,528  
     

 
        726,968  
     

 

Utilities-3.62%

     

GAIL (India) Ltd.

     284,290        313,559  

Gujarat Gas Ltd.

     21,684        135,850  

Indraprastha Gas Ltd.

     37,762        195,362  

JSW Energy Ltd.

     41,184        167,990  

NHPC Ltd.

     246,269        126,738  

NTPC Ltd.

     478,073        999,721  

Power Grid Corp. of India Ltd.

     338,948        934,203  

Tata Power Co. Ltd. (The)

     178,477        487,280  

Torrent Power Ltd.

     23,317        142,067  
     

 
        3,502,770  
     

 

Total Common Stocks & Other Equity Interests
(Cost $90,184,575)

 

     97,107,301  
     

 
     Principal
Amount
        

Non-U.S. Dollar Denominated Bonds & Notes-0.01% (f)

 

Consumer Staples-0.01%

     

Britannia Industries Ltd., Series N3, 5.50%, 06/03/2024
(Cost $6,123)

     INR 445,614        5,218  
     

 
     Shares         

Money Market Funds-1.24%

     

Invesco Government & Agency Portfolio, Institutional Class,
3.07% (g)(h) (Cost $1,199,581)

     1,199,581        1,199,581  
     

 

TOTAL INVESTMENTS IN SECURITIES-101.62%
(Cost $91,390,279)

 

     98,312,100  

OTHER ASSETS LESS LIABILITIES-(1.62)%

 

     (1,566,622
     

 

NET ASSETS-100.00%

      $ 96,745,478  
     

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

  7  

 

 


Invesco India ETF (PIN)–(continued)

October 31, 2022

Notes to Schedule of Investments:

(a)  

Industry and/or sector classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s.

(b)  

Country of issuer and/or credit risk exposure listed in Common Stocks & Other Equity Interests has been determined to be India unless otherwise noted.

(c)  

Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at October 31, 2022 was $2,923,536, which represented 3.02% of the Fund’s Net Assets.

(d)  

Non-income producing security.

(e)  

Security valued using significant unobservable inputs (Level 3). See Note 4.

(f)  

Foreign denominated security. Principal amount is denominated in the currency indicated.

(g)  

Affiliated issuer. The issuer and/or the Fund is a wholly-owned subsidiary of Invesco Ltd., or is affiliated by having an investment adviser that is under common control of Invesco Ltd. The table below shows the Fund’s transactions in, and earnings from, its investments in affiliates for the fiscal year ended October 31, 2022.

    

Value
October 31, 2021

    

Purchases

    at Cost    

    

Proceeds

from Sales

   

Change in
Unrealized
Appreciation

    

Realized
    Gain    

    

Value
October 31, 2022

     Dividend
  Income  
 

Investments in Affiliated Money Market Funds:

                   

Invesco Government & Agency Portfolio, Institutional Class

     $3,818,737        $34,521,356        $(37,140,512)       $-        $-        $1,199,581        $7,935  

(h)  

The rate shown is the 7-day SEC standardized yield as of October 31, 2022.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

  8  

 

 


Statement of Assets and Liabilities

October 31, 2022

    

Invesco India ETF
            (PIN)           

 

Assets:

             

Unaffiliated investments in securities, at value

      $ 97,112,519     

Affiliated investments in securities, at value

        1,199,581     

Foreign currencies, at value

        110,900     

Receivable for:

        

Dividends and interest

        94,875     

Foreign tax reclaims

        265,380     
     

    

Total assets

        98,783,255     
     

    

Liabilities:

        

Accrued unitary management fees

        62,780     

Accrued tax expenses

        1,974,997     
     

    

Total liabilities

        2,037,777     
     

    

Net Assets

      $ 96,745,478     
     

    

Net assets consist of:

        

Shares of beneficial interest

      $ 84,868,351     

Distributable earnings

        11,877,127     
     

    

Net Assets

      $ 96,745,478     
     

    

Shares outstanding (unlimited amount authorized, $0.01 par value)

        3,980,000     

Net asset value

      $ 24.31     
     

    

Market price

      $ 24.42     
     

    

Unaffiliated investments in securities, at cost

      $ 90,190,698     
     

    

Affiliated investments in securities, at cost

      $ 1,199,581     
     

    

Foreign currencies, at cost

      $ 111,309     
     

    

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

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Statement of Operations

For the year ended October 31, 2022

    

Invesco India ETF
            (PIN)           

 

Investment income:

  

    

    

Unaffiliated dividend income

      $     1,707,342    

Affiliated dividend income

        7,935    

Foreign withholding tax

        (406,858  
     

   

Total investment income

        1,308,419    
     

   

Expenses:

       

Unitary management fees

        820,123    
     

   

Less: Waivers

        (471  
     

   

Net expenses

        819,652    
     

   

Net investment income

        488,767    
     

   

Realized and unrealized gain (loss) from:

       

Net realized gain (loss) from:

       

Unaffiliated investment securities (net of foreign taxes of $1,989,380)

        11,580,681    

Foreign currencies

        (324,156  
     

   

Net realized gain

        11,256,525    
     

   

Change in net unrealized appreciation (depreciation) of:

       

Unaffiliated investment securities (net of change of deferred foreign taxes of $2,889,399)

        (21,854,880  

Foreign currencies

        8,557    
     

   

Change in net unrealized appreciation (depreciation)

        (21,846,323  
     

   

Net realized and unrealized gain (loss)

        (10,589,798  
     

   

Net increase (decrease) in net assets resulting from operations

      $ (10,101,031  
     

   

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

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Statement of Changes in Net Assets

For the years ended October 31, 2022 and 2021

     Invesco India ETF (PIN)  
              
     2022     2021  

Operations:

    

Net investment income

   $ 488,767     $ 513,872  

Net realized gain

     11,256,525       10,314,967  

Change in net unrealized appreciation (depreciation)

     (21,846,323     27,206,422  
  

   

 

Net increase (decrease) in net assets resulting from operations

     (10,101,031     38,035,261  
  

   

 

Distributions to Shareholders from:

    

Distributable earnings

     (6,889,923     (1,131,311
  

   

 

Shareholder Transactions:

    

Proceeds from shares sold

     20,729,135       18,424,869  

Value of shares repurchased

     (27,817,123     (26,257,951

Transaction fees

     154,234       108,528  
  

   

 

Net increase (decrease) in net assets resulting from share transactions

     (6,933,754     (7,724,554
  

   

 

Net increase (decrease) in net assets

     (23,924,708     29,179,396  
  

   

 

Net assets:

    

Beginning of year

     120,670,186       91,490,790  
  

   

 

End of year

   $ 96,745,478     $ 120,670,186  
  

   

 

Changes in Shares Outstanding:

    

Shares sold

     810,000       740,000  

Shares repurchased

     (1,140,000     (1,080,000

Shares outstanding, beginning of year

     4,310,000       4,650,000  
  

   

 

Shares outstanding, end of year

     3,980,000       4,310,000  
  

   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

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Financial Highlights

Invesco India ETF (PIN)

     Years Ended October 31,  
  

 
     2022     2021     2020     2019     2018  

Per Share Operating Performance:

          

Net asset value at beginning of year

   $ 28.00     $ 19.68     $ 25.25     $ 22.24     $ 25.58  
  

   

   

   

   

 

Net investment income (a)

     0.12       0.11       0.11       0.24       0.28  

Net realized and unrealized gain (loss) on investments

     (2.25     8.45       (0.06     3.02       (3.63
  

   

   

   

   

 

Total from investment operations

     (2.13     8.56       0.05       3.26       (3.35
  

   

   

   

   

 

Distributions to shareholders from:

          

Net investment income

     (0.11     (0.26     (0.07     (0.28     -  

Net realized gains

     (1.49     -       (5.48     -       -  

Return of capital

     -       -       (0.10     -       -  
  

   

   

   

   

 

Total distributions

     (1.60     (0.26     (5.65     (0.28     -  
  

   

   

   

   

 

Transaction fees (a)

     0.04       0.02       0.03       0.03       0.01  
  

   

   

   

   

 

Net asset value at end of year

   $ 24.31     $ 28.00     $ 19.68     $ 25.25     $ 22.24  
  

   

   

   

   

 

Market price at end of year (b)

   $ 24.42     $ 28.08     $ 19.46     $ 25.12     $ 22.06  
  

   

   

   

   

 

Net Asset Value Total Return (c)

     (7.63 )%      43.64     0.75     14.85     (13.06 )% 

Market Price Total Return (c)

     (7.53 )%      45.68     0.08     15.19     (13.90 )% 

Ratios/Supplemental Data:

          

Net assets at end of year (000’s omitted)

   $ 96,745     $ 120,670     $ 91,491     $ 132,566     $ 200,175  

Ratio to average net assets of:

          

Expenses

     0.78     0.78     0.78     0.85     0.82

Net investment income

     0.46     0.45     0.60     0.98     1.12

Portfolio turnover rate (d)

     38     36     42     160     27

(a)  

Based on average shares outstanding.

(b)  

The mean between the last bid and ask prices.

(c)  

Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption at net asset value on the last day of the period. Net asset value total return 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. Market price total return is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period, and sale at the market price on the last day of the period. Total investment returns calculated for a period of less than one year are not annualized.

(d)  

Portfolio turnover rate is not annualized for periods less than one year, if applicable, and does not include securities received or delivered from processing creations or redemptions.

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

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Notes to Financial Statements

Invesco India Exchange-Traded Fund Trust

October 31, 2022

NOTE 1 – Organization

Invesco India Exchange-Traded Fund Trust (the “Trust”) was organized as a Massachusetts business trust and is authorized to have multiple series of portfolios. The Trust is an open-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”). This report includes Invesco India ETF (PIN) (the “Fund”). Prior to March 25, 2019, the Fund invested substantially all of its assets in Invesco Mauritius PIN, a wholly-owned subsidiary organized in Mauritius (the “Subsidiary”) to gain exposure to Indian equity securities. Effective March 25, 2019, the Subsidiary liquidated and ceased operations. For periods prior to March 25, 2019, the Financial Highlights report the operations of the Fund and the Subsidiary on a consolidated basis.

The Fund represents a separate series of the Trust. The shares of the Fund are referred to herein as “Shares” or “Fund’s Shares.” The Fund’s Shares are listed on NYSE Arca, Inc.

The market price of a Share may differ to some degree from the Fund’s net asset value (“NAV”). Unlike conventional mutual funds, the Fund issues and redeems Shares on a continuous basis, at NAV, only in a large specified number of Shares, each called a “Creation Unit.” Creation Units are issued and redeemed principally in exchange for the deposit or delivery of cash. Except when aggregated in Creation Units by authorized participants (“APs”), Shares are not individually redeemable securities of the Fund.

The investment objective of the Fund is to seek to track the investment results (before fees and expenses) of the FTSE India Quality and Yield Select Index (the “Underlying Index”).

NOTE 2 – Significant Accounting Policies

The following is a summary of the significant accounting policies followed by the Fund in preparation of its financial statements.

The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services–Investment Companies.

A.

Security Valuation - Securities, including restricted securities, are valued according to the following policies:

A security listed or traded on an exchange is generally valued at its trade price or official closing price that day as of the close of the exchange where the security is principally traded or, lacking any trades or official closing price on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market are valued based on prices furnished by independent pricing services or market makers. When such securities are valued using prices provided by an independent pricing service they may be considered fair valued. Futures contracts are valued at the daily settlement price set by an 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 are principally traded. 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.

Securities of investment companies that are not exchange-traded (e.g., open-end mutual funds) are valued using such company’s end-of-business-day NAV per share.

Deposits, other obligations of U.S. and non-U.S. banks and financial institutions are valued at their daily account value.

Fixed income securities (including convertible debt securities) generally are valued on the basis of prices provided by independent pricing services. Prices provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Securities with a demand feature exercisable within one to seven days are valued at par. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but the 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, and their value may be adjusted accordingly. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.

Foreign securities’ (including foreign exchange contracts’) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the London world markets. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Invesco Capital Management LLC (the “Adviser”) may use various pricing services to obtain market quotations as well as fair value prices. Because trading hours for certain foreign securities end before the close of the New York Stock Exchange (“NYSE”), closing market quotations may become not representative of market value in the Adviser’s judgment (“unreliable”). If, between the time trading ends on a particular security and the close of the customary trading session on the NYSE, a significant event occurs that makes the

 

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closing price of the security unreliable, the Adviser may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith in accordance with Board-approved policies and related Adviser procedures (“Valuation Procedures”). Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American depositary receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, the potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.

Unlisted securities will be valued using prices provided by independent pricing services or by another method that the Adviser, in its judgment, believes better reflects the security’s fair value in accordance with the Valuation Procedures.

Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value exchange-traded equity securities. The mean between the last bid and asked prices may be used to value debt obligations, including corporate loans, and unlisted equity securities.

Securities for which market quotations are not readily available are fair valued by the Adviser in accordance with the Valuation Procedures. If a fair value price provided by a pricing service is unreliable, the Adviser will fair value the security using the Valuation Procedures. Issuer-specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.

The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.

Valuations change in response to many factors, including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general market conditions which are not specifically related to the particular issuer, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, regional or global instability, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism, significant governmental actions or adverse investor sentiment generally and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.

The price the 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, 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.

B.

Investment Transactions and Investment Income - Investment transactions are accounted for on a trade date basis. Realized gains and losses from the sale or disposition of securities are computed on the specific identified cost basis. Interest income is recorded on an accrual basis from settlement date and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. Realized gains, dividends and interest received by the Fund may give rise to withholding and other taxes imposed by foreign countries. Tax conventions between certain countries and the United States may reduce or eliminate such taxes.

The Fund may periodically participate in litigation related to the Fund’s investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.

Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund’s NAV and, accordingly, they reduce the Fund’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income

 

  14  

 

 


per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the Adviser.

C.

Country Determination - For the purposes of presentation in the Schedule of Investments, the Adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include whether the Fund’s Underlying Index has made a country determination and may include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues, the country that has the primary market for the issuer’s securities and its “country of risk” as determined by a third party service provider, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be India, unless otherwise noted.

D.

Dividends and Distributions to Shareholders - The Fund declares and pays dividends from net investment income, if any, to its shareholders quarterly and records such dividends on the ex-dividend date. Generally, the Fund distributes net realized taxable capital gains, if any, annually in cash and records them on the ex-dividend date. Such distributions on a tax basis are determined in conformity with federal income tax regulations, which may differ from accounting principles generally accepted in the United States of America (“GAAP”). Distributions in excess of tax basis earnings and profits, if any, are reported in such Fund’s financial statements as a tax return of capital at fiscal year-end.

E.

Taxes - The Fund intends to comply with the provisions of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), applicable to regulated investment companies and to distribute substantially all of the Fund’s taxable earnings to its shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized gains) that is distributed to the shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. Under the applicable foreign tax laws, a withholding tax may be imposed on interest, dividends and capital gains at various rates.

The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund’s uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.

Income and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP. These differences are primarily due to differing book and tax treatments for in-kind transactions, losses deferred due to wash sales and passive foreign investment company adjustments, if any.

The Fund files U.S. federal tax returns and tax returns in certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.

The Fund is subject to a 15% short-term capital gains tax in India on the sale of shares of Indian resident companies. Additionally, the Fund is subject to a 10% long-term capital gains tax in India on the sale of shares of Indian resident companies purchased after April 1, 2018. Withholding tax rates on dividends and interest received from Indian resident companies vary from 20% to 25% for dividends and 5% to 40% for interest. Changes in the Indian tax law could reduce the return to the Fund on its investments and the return received by Fund shareholders.

F.

Expenses - The Fund has agreed to pay an annual unitary management fee to the Adviser. Out of the unitary management fee, the Adviser has agreed to pay for substantially all expenses of the Fund, including the costs of transfer agency, custody, fund administration, legal, audit and other services, except for distribution fees, if any, brokerage expenses, taxes, interest, acquired fund fees and expenses, if any, litigation expenses and other extraordinary expenses, including proxy expenses (except for such proxies related to: (i) changes to the Investment Advisory Agreement, (ii) the election of any Board member who is an “interested person” of the Trust, or (iii) any other matters that directly benefit the Adviser).

To the extent the Fund invests in other investment companies, the expenses shown in the accompanying financial statements reflect the expenses of the Fund and do not include any expenses of the investment companies in which it invests. The effects of such investment companies’ expenses are included in the realized and unrealized gain or loss on the investments in the investment companies.

G.

Accounting Estimates - The preparation of the financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements, including estimates and assumptions related to taxation. Actual results could differ from these estimates. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print.

H.

Indemnifications - Under the Trust’s organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. Each Board member who is not an “interested person” (as defined in the 1940 Act) of the Trust (each, an “Independent Trustee”) is also indemnified against certain liabilities arising out of the performance of their duties to the Trust pursuant to an Indemnification Agreement between such trustee and the Trust. Additionally, in the normal course of business, the Trust enters into contracts with service providers that contain general

 

  15  

 

 


indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote.

I.

Foreign Currency Translations - Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period-end, resulting from changes in exchange rates.

The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests.

J.

Other Risks

AP Concentration Risk . Only APs may engage in creation or redemption transactions directly with the Fund. The Fund has a limited number of institutions that may act as APs, and such APs have no obligation to submit creation or redemption orders. Consequently, there is no assurance that APs will establish or maintain an active trading market for the Shares. This risk may be heightened to the extent that securities held by the Fund are traded outside a collateralized settlement system. In that case, APs may be required to post collateral on certain trades on an agency basis (i.e., on behalf of other market participants), which only a limited number of APs may be able to do. In addition, to the extent that APs exit the business or are unable to proceed with creation and/or redemption orders with respect to the Fund and no other AP is able to step forward to create or redeem Creation Units, this may result in a significantly diminished trading market for Fund Shares, and Shares may be more likely to trade at a premium or discount to the Fund’s NAV and to face trading halts and/or delisting. Investments in non-U.S. securities, which may have lower trading volumes or could experience extended market closures or trading halts, may increase the risk that APs may not be able to effectively create or redeem Creation Units or the risk that the Shares may be halted and/or delisted.

Cash Transaction Risk . Most exchange-traded funds (“ETFs”) generally make in-kind redemptions to avoid being taxed at the fund level on gains on the distributed portfolio securities. However, unlike most ETFs, the Fund currently intends to effect creations and redemptions principally for cash, rather than principally in-kind, because of the nature of the Fund’s investments. As such, the Fund may be required to sell portfolio securities to obtain the cash needed to distribute redemption proceeds. Therefore, the Fund may recognize a capital gain on these sales that might not have been incurred if the Fund had made a redemption in-kind. This may decrease the tax efficiency of the Fund compared to ETFs that utilize an in-kind redemption process and there may be a substantial difference in the after-tax rate of return between the Fund and conventional ETFs.

Currency Risk . Because the Fund’s NAV is determined in U.S. dollars, the Fund’s NAV could decline if the currency of a non-U.S. market in which the Fund invests depreciates against the U.S. dollar. Generally, an increase in the value of the U.S. dollar against a foreign currency will reduce the value of a security denominated in that foreign currency, thereby decreasing the Fund’s overall NAV. Exchange rates may be volatile and may change quickly and unpredictably in response to both global economic developments and economic conditions, causing an adverse impact on the Fund. As a result, investors have the potential for losses regardless of the length of time they intend to hold Shares.

Equity Risk . Equity risk is the risk that the value of equity securities, including common stocks, may fall due to both changes in general economic conditions that impact the market as a whole, as well as factors that directly relate to a specific company or its industry. Such general economic conditions include changes in interest rates, periods of market turbulence or instability, or general and prolonged periods of economic decline and cyclical change. It is possible that a drop in the stock market may depress the price of most or all of the common stocks that the Fund holds. In addition, equity risk includes the risk that investor sentiment toward one or more industries will become negative, resulting in those investors exiting their investments in those industries, which could cause a reduction in the value of companies in those industries more broadly. The value of a company’s common stock may fall solely because of factors, such as an increase in production costs that negatively impact other companies in the same region, industry or sector of the market. A company’s common stock also may decline significantly in price over a short period of time due to factors specific to that company, including decisions made by its management or lower demand for the company’s products or services. For example, an adverse event, such as an unfavorable earnings report or the failure to make anticipated dividend payments, may depress the value of common stock.

 

  16  

 

 


Index Risk . Unlike many investment companies, the Fund does not utilize an investing strategy that seeks returns in excess of its Underlying Index. Therefore, the Fund would not necessarily buy or sell a security unless that security is added or removed, respectively, from its Underlying Index, even if that security generally is underperforming. Additionally, the Fund rebalances its portfolio in accordance with its Underlying Index, and, therefore, any changes to the Underlying Index’s rebalance schedule will result in corresponding changes to the Fund’s rebalance schedule.

Indian Securities Risk . Investment in Indian securities involves risks in addition to those associated with investments in securities of issuers in more developed countries, which may adversely affect the value of the Fund’s assets. Such heightened risks include, among others, political and legal uncertainty, greater government control over the economy, currency fluctuations or blockage and the risk of nationalization or expropriation of assets. In addition, religious and border disputes persist in India. Certain restrictions on foreign investment may decrease the liquidity of the Fund’s portfolio or inhibit the Fund’s ability to track the Underlying Index. The Fund’s investment in securities of issuers located or operating in India as well as its ability to track the Underlying Index may be limited or prevented at times, due to the limits on foreign ownership imposed by the Reserve Bank of India.

Market Risk . Securities in the Underlying Index are subject to market fluctuations. You should anticipate that the value of the Shares will decline, more or less, in correlation with any decline in value of the securities in the Underlying Index. Additionally, natural or environmental disasters, widespread disease or other public health issues, war, acts of terrorism or other events could result in increased premiums or discounts to the Fund’s NAV.

Non-Correlation Risk . The Fund’s return may not match the return of its Underlying Index for a number of reasons. For example, the Fund incurs operating expenses not applicable to the Underlying Index, and incurs costs in buying and selling securities, especially when rebalancing the Fund’s securities holdings to reflect changes in the composition of its Underlying Index. Because the Fund issues and redeems Creation Units principally for cash, the Fund will incur higher costs in buying and selling securities than if it issued and redeemed Creation Units in-kind. Additionally, the Fund’s use of a representative sampling approach may cause the Fund not to be as well-correlated with the return of its Underlying Index as would be the case if the Fund purchased all of the securities in its Underlying Index in the proportions represented in the Underlying Index. In addition, the performance of the Fund and its Underlying Index may vary due to asset valuation differences and differences between the Fund’s portfolio and its Underlying Index resulting from legal restrictions, costs or liquidity constraints.

Non-Diversified Fund Risk . Because the Fund is non-diversified and can invest a greater portion of its assets in securities of individual issuers than can a diversified fund, changes in the market value of a single investment could cause greater fluctuations in Share price than would occur in a diversified fund. This may increase the Fund’s volatility and cause the performance of a relatively small number of issuers to have a greater impact on the Fund’s performance.

Regulatory Risk . The Fund is registered as a foreign portfolio investor (“FPI”) with the Securities and Exchange Board of India (“SEBI”) in order to have the ability to make and dispose of investments in Indian securities. There can be no assurance that the Fund will qualify or continue to qualify as an FPI under the SEBI FPI Regulations, 2019, or that the Indian regulatory authorities will continue to grant such qualifications, and the loss of such qualifications could adversely impact the ability of the Fund to make and dispose of investments in India. Investments by FPIs in Indian securities are also subject to certain limits and restrictions under applicable law, and the application of such limits and restrictions could adversely impact the ability of the Fund to make investments in India.

Small- and Mid-Capitalization Company Risk . Investing in securities of small- and mid-capitalization companies involves greater risk than customarily is associated with investing in larger, more established companies. These companies’ securities may be more volatile and less liquid than those of more established companies. These securities may have returns that vary, sometimes significantly, from the overall securities market. Often small- and mid-capitalization companies and the industries in which they focus are still evolving and, as a result, they may be more sensitive to changing market conditions.

Valuation Risk . Financial information related to securities of non-U.S. issuers may be less reliable than information related to securities of U.S. issuers, which may make it difficult to obtain a current price for a non-U.S. security held by the Fund. In certain circumstances, market quotations may not be readily available for some Fund securities, and those securities may be fair valued. The value established for a security through fair valuation may be different from what would be produced if the security had been valued using market quotations. Fund securities that are valued using techniques other than market quotations, including “fair valued” securities, may be subject to greater fluctuations in their value from one day to the next than would be the case if market quotations were used. In addition, there is no assurance that the Fund could sell a portfolio security for the value established for it at any time, and it is possible that the Fund would incur a loss because a security is sold at a discount to its established value.

COVID-19 Risk . The COVID-19 strain of coronavirus has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain its spread have resulted in travel restrictions, disruptions of healthcare systems, business operations (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.

 

  17  

 

 


NOTE 3–Investment Advisory Agreement and Other Agreements

The Trust has entered into an Investment Advisory Agreement with the Adviser on behalf of the Fund, pursuant to which the Adviser has overall responsibility for the selection and ongoing monitoring of the Fund’s investments, managing the Fund’s business affairs and providing certain clerical, bookkeeping and other administrative services.

Pursuant to the Investment Advisory Agreement, the Fund accrues daily and pays monthly to the Adviser an annual unitary management fee of 0.78% of the Fund’s average daily net assets. Out of the unitary management fee, the Adviser has agreed to pay for substantially all expenses of the Fund, including the costs of transfer agency, custody, fund administration, legal, audit and other services, except for distribution fees, if any, brokerage expenses, taxes, interest, acquired fund fees and expenses, if any, litigation expenses and other extraordinary expenses, including proxy expenses (except for such proxies related to: (i) changes to the Investment Advisory Agreement, (ii) the election of any Board member who is an “interested person” of the Trust, or (iii) any other matters that directly benefit the Adviser).

Through at least August 31, 2024, the Adviser has contractually agreed to waive the management fee payable by the Fund in an amount equal to the lesser of: (i) 100% of the net advisory fees earned by the Adviser or an affiliate of the Adviser that are attributable to the Fund’s investments in money market funds that are managed by affiliates of the Adviser and other funds (including ETFs) managed by the Adviser or affiliates of the Adviser or (ii) the management fee available to be waived. There is no guarantee that the Adviser will extend the waiver of these fees past that date. This agreement is not subject to recapture by the Adviser.

For the fiscal year ended October 31, 2022, the Adviser waived fees of $471.

The Trust has entered into a Distribution Agreement with Invesco Distributors, Inc. (the “Distributor”), which serves as the distributor of Creation Units for the Fund. The Distributor does not maintain a secondary market in the Shares. The Fund is not charged any fees pursuant to the Distribution Agreement. The Distributor is an affiliate of the Adviser.

The Adviser has entered into a licensing agreement for the Fund with FTSE International Ltd. (the “Licensor”). The Underlying Index name trademark is owned by the Licensor. The trademark has been licensed to the Adviser for use by the Fund. The Fund is entitled to use the Underlying Index pursuant to the Trust’s sub-licensing agreement with the Adviser. The Fund is not sponsored, endorsed, sold or promoted by the Licensor, and the Licensor makes no representation regarding the advisability of investing in the Fund. The Fund is not a party to the licensing agreement.

The Trust has entered into service agreements whereby BNYM, a wholly-owned subsidiary of The Bank of New York Mellon Corporation, serves as the administrator, custodian, fund accountant and transfer agent for the Fund.

NOTE 4–Additional Valuation Information

GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:

Level 1 –   Prices are determined using quoted prices in an active market for identical assets.
Level 2 –   Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others.
Level 3 –   Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Adviser’s assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information.

The following is a summary of the tiered valuation input levels, as of October 31, 2022. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.

     Level 1      Level 2      Level 3      Total  

Investments in Securities

           

Common Stocks & Other Equity Interests

   $ 97,026,475      $ -      $ 80,826      $ 97,107,301  

Non-U.S. Dollar Denominated Bonds & Notes

     -        5,218        -        5,218  

Money Market Funds

     1,199,581        -        -        1,199,581  
  

    

    

    

 

Total Investments

   $ 98,226,056      $ 5,218      $ 80,826      $ 98,312,100  
  

    

    

    

 

 

  18  

 

 


NOTE 5–Distributions to Shareholders and Tax Components of Net Assets

Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended October 31, 2022 and 2021:

     2022      2021  

Ordinary income*

   $ -      $ -  

Long-term capital gain

     6,889,923        1,131,311  

*

Includes short-term capital gain distributions, if any.

Tax Components of Net Assets at Fiscal Year-End:

Undistributed long-term capital gains

      $ 12,387,140  

Net unrealized appreciation – investments

        2,754,293  

Net unrealized appreciation (depreciation) – foreign currencies and foreign taxes

        (1,975,639

Late-Year Ordinary Loss Deferral

        (1,288,667

Shares of beneficial interest

        84,868,351  
     

 

Total net assets

      $ 96,745,478  
     

 

Capital loss carryforwards are calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforwards actually available for the Fund to utilize. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.

The Fund does not have a capital loss carryforward as of October 31, 2022.

NOTE 6–Investment Transactions

For the fiscal year ended October 31, 2022, the cost of securities purchased and proceeds from sales of securities (other than short-term securities, U.S. Government obligations, money market funds and in-kind transactions, if any) were $40,469,069 and $52,425,792, respectively.

At October 31, 2022, the aggregate cost of investments, including any derivatives, on a tax basis includes adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end:

Aggregate unrealized appreciation of investments

   $ 11,172,702  

Aggregate unrealized (depreciation) of investments

     (8,418,409
  

 

Net unrealized appreciation of investments

   $  2,754,293  
  

 
Cost of investments for tax purposes is $95,557,807.       

NOTE 7–Reclassification of Permanent Differences

Primarily as a result of differing book/tax treatment of foreign capital gain taxes, net operating losses, distributions, foreign currency and taxable spinoffs, undistributed net investment income (loss) was decreased by $1,322,448, undistributed net realized gain (loss) was increased by $1,322,446 and Shares of beneficial interest were increased by $2. These reclassifications had no effect on the net assets of the Fund.

NOTE 8–Trustees’ and Officer’s Fees

The Adviser, as a result of the Fund’s unitary management fee, pays remuneration to the Independent Trustees and an Officer of the Trust on behalf of the Fund. The Trustee who is an “interested person” of the Trust does not receive any Trustees’ fees.

The Trust has adopted a deferred compensation plan (the “Plan”). Under the Plan, each Independent Trustee who has executed a Deferred Fee Agreement (a “Participating Trustee”) may defer receipt of all or a portion of their compensation (“Deferral Fees”). Such Deferral Fees are deemed to be invested in select Invesco ETFs. The Deferral Fees payable to a Participating Trustee are valued as of the date such Deferral Fees would have been paid to a Participating Trustee. The value increases with contributions or with increases in the value of the Shares selected, and the value decreases with distributions or with declines in the value of the Shares selected. Obligations under the Plan represent unsecured claims against the general assets of the Fund.

NOTE 9–Capital

Shares are issued and redeemed by the Fund only in Creation Units consisting of a specified number of Shares as set forth in the Fund’s prospectus. Only APs are permitted to purchase or redeem Creation Units from the Fund. Such transactions are principally permitted in exchange for the deposit or delivery of cash. The Fund also reserves the right to permit or require Creation Units to be issued in exchange for the deposit or delivery of a basket of securities. However, cash in an amount

 

  19  

 

 


equivalent to the value of certain securities may be substituted, generally when the securities are not available in sufficient quantity for delivery, not eligible for trading by the AP or as a result of other market circumstances.

To the extent that the Fund permits transactions in exchange for Deposit Securities, the Fund may issue Shares in advance of receipt of Deposit Securities subject to various conditions, including a requirement to maintain on deposit with the Trust cash at least equal to 105% of the market value of the missing Deposit Securities. In accordance with the Trust’s Participant Agreement, Creation Units will be issued to an AP, notwithstanding the fact that the corresponding Deposit Securities have not been received in part or in whole, in reliance on the undertaking of the AP to deliver the missing Deposit Securities as soon as possible, which undertaking shall be secured by the AP’s delivery and maintenance of collateral consisting of cash in the form of U.S. dollars in immediately available funds having a value (marked-to-market daily) at least equal to 105%, which the Adviser may change from time to time, of the value of the missing Deposit Securities.

Certain transaction fees may be charged by the Fund for creations and redemptions, which are treated as increases in capital. Transactions in the Fund’s Shares are disclosed in detail in the Statement of Changes in Net Assets.

 

  20  

 

 


Report of Independent Registered Public Accounting Firm

To the Board of Trustees of Invesco India Exchange-Traded Fund Trust and Shareholders of Invesco India ETF

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Invesco India ETF (constituting Invesco India Exchange-Traded Fund Trust, referred to hereafter as the “Fund”) as of October 31, 2022, the related statement of operations for the year ended October 31, 2022, the statement of changes in net assets for each of the two years in the period ended October 31, 2022, including the related notes, and the financial highlights for each of the five years in the period ended October 31, 2022 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of October 31, 2022, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended October 31, 2022 and the financial highlights for each of the five years in the period ended October 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of October 31, 2022 by correspondence with the custodian and transfer agent. We believe that our audits provide a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

Chicago, Illinois

December 23, 2022

We have served as the auditor of one or more of the investment companies in the Invesco group of investment companies since at least 1995. We have not been able to determine the specific year we began serving as auditor.

 

  21  

 

 


Calculating your ongoing Fund expenses

Example

As a shareholder of the Invesco India ETF (the “Fund”), you incur a unitary management fee. In addition to the unitary management fee, a shareholder may pay distribution fees, if any, brokerage expenses, taxes, interest, acquired fund fees and expenses, if any, litigation expenses and other extraordinary expenses, including proxy expenses (except for such proxies related to: (i) changes to the Investment Advisory Agreement, (ii) the election of any Board member who is an “interested person” of the Trust, or (iii) any other matters that directly benefit the Adviser). The expense example below is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other funds.

The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period May 1, 2022 through October 31, 2022.

Actual Expenses

The first line in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second line in the following table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed annualized rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs, such as sales charges and brokerage commissions. Therefore, the second line in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

     Beginning
Account Value
May 1, 2022
     Ending
Account Value
October 31, 2022
     Annualized
Expense Ratio
Based on the
Six-Month Period
   

Expenses Paid
During the

Six-Month Period (1) 

 

Invesco India ETF (PIN)

          

Actual

     $1,000.00        $    960.10              0.78%       $3.85  

Hypothetical (5% return before expenses)

        1,000.00           1,021.27           0.78          3.97  

(1)  

Expenses are calculated using the annualized expense ratio, which represents the ongoing expenses as a percentage of net assets for the six-month period ended October 31, 2022. Expenses are calculated by multiplying the Fund’s annualized expense ratio by the average account value for the period, then multiplying the result by 184/365. Expense ratios for the most recent six-month period may differ from expense ratios based on the annualized data in the Financial Highlights.

 

  22  

 

 


Tax Information

Form 1099-DIV, Form 1042-S and other year-end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisers.

The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state’s requirement.

The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended October 31, 2022:

Business Interest Income*

     -%  

Qualified Business Income*

     -%  

Qualified Dividend Income*

     -%  

Corporate Dividends Received Deduction*

     -%  

U.S. Treasury Obligations*

     -%  

Long-Term Capital Gain Distributions

   $ 6,889,923      

* The above percentages are based on ordinary income dividends paid to shareholders during the Fund’s fiscal year.    

 

  23  

 

 


Trustees and Officers

The Independent Trustees of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex (as defined below) overseen by each Independent Trustee and the other directorships, if any, held by each Independent Trustee are shown below:

As of October 31, 2022

Name, Address and Year of
Birth of Independent Trustees
   Position(s)
Held
with Trust        
   Term of
Office
and
Length of
Time
Served*
  

Principal
Occupation(s) During

the Past 5 Years

     Number of
Portfolios
in Fund
Complex**
Overseen by        
Independent
Trustees
   Other
Directorships
Held by
Independent
Trustees During
the Past 5 Years        

Ronn R. Bagge–1958

c/o Invesco Capital Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Vice Chair of the Board; Chair of the Nominating and Governance Committee and Trustee    Vice Chair since 2018; Chair of the Nominating and Governance Committee and Trustee since 2008   

Founder and Principal, YQA Capital Management LLC (1998-Present); formerly, Owner/CEO of Electronic Dynamic Balancing Co., Inc.

(high-speed rotating equipment service provider).

     234    Chair (since 2021) and member (since 2017) of the Joint Investment Committee, Mission Aviation Fellowship and MAF Foundation; Trustee, Mission Aviation Fellowship (2017-Present).

Todd J. Barre–1957

c/o Invesco Capital

Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Trustee    Since 2010    Assistant Professor of Business, Trinity Christian College (2010-2016); formerly, Vice President and Senior Investment Strategist (2001-2008), Director of Open Architecture and Trading (2007-2008), Head of Fundamental Research (2004-2007) and Vice President and Senior Fixed Income Strategist (1994-2001), BMO Financial Group/Harris Private Bank.      234    None.

*

This is the date the Independent Trustee began serving the Trust. Each Independent Trustee serves an indefinite term, until his or her successor is elected.

**

Fund Complex includes all open- and closed-end funds (including all of their portfolios) advised by the Adviser and any affiliated person of the Adviser.

 

  24  

 

 


Trustees and Officers–(continued)

Name, Address and Year of

Birth of Independent Trustees

  

Position(s)

Held

with Trust        

  

Term of

Office

and

Length of        

Time

Served*

  

Principal

Occupation(s) During

the Past 5 Years

    

Number of

Portfolios

in Fund

Complex**

Overseen by        

Independent

Trustees

  

Other

Directorships

Held by

Independent

Trustees During

the Past 5 Years        

Edmund P. Giambastiani,

Jr.–1948

c/o Invesco Capital

Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Trustee    Since 2019    President, Giambastiani Group LLC (national security and energy consulting) (2007-Present); Director, First Eagle Alternative Credit LLC (2020-Present); Advisory Board Member, Massachusetts Institute of Technology Lincoln Laboratory (federally-funded research development) (2010-Present); Defense Advisory Board Member, Lawrence Livermore National Laboratory (2013-Present); formerly, Director, The Boeing Company (2009-2021); Trustee, MITRE Corporation (federally funded research development) (2008-2020); Director, THL Credit, Inc. (alternative credit investment manager) (2016-2020); Chair (2015-2016), Lead Director (2011-2015) and Director (2008-2011), Monster Worldwide, Inc. (career services); United States Navy, career nuclear submarine officer (1970-2007); Seventh Vice Chair of the Joint Chiefs of Staff (2005-2007); first NATO Supreme Allied Commander Transformation (2003-2005); Commander, U.S. Joint Forces Command (2002-2005).      234    Trustee, U.S. Naval Academy Foundation Athletic & Scholarship Program (2010- Present); formerly, Trustee, certain funds of the Oppenheimer Funds complex (2013-2019); Advisory Board Member, Maxwell School of Citizenship and Public Affairs of Syracuse University (2012-2016).

*

This is the date the Independent Trustee began serving the Trust. Each Independent Trustee serves an indefinite term, until his or her successor is elected.

**

Fund Complex includes all open- and closed-end funds (including all of their portfolios) advised by the Adviser and any affiliated person of the Adviser.

 

  25  

 

 


Trustees and Officers–(continued)

Name, Address and Year of

Birth of Independent Trustees

  

Position(s)

Held

with Trust        

  

Term of

Office

and

Length of        

Time

Served*

  

Principal

Occupation(s) During

the Past 5 Years

    

Number of

Portfolios

in Fund

Complex**

Overseen by        

Independent

Trustees

  

Other

Directorships

Held by

Independent

Trustees During

the Past 5 Years        

Victoria J. Herget–1951

c/o Invesco Capital Management LLC 3500 Lacey Road, Suite 700 Downers Grove, IL 60515

   Trustee    Since 2019    Formerly, Managing Director (1993-2001), Principal (1985-1993), Vice President (1978-1985) and Assistant Vice President (1973-1978), Zurich Scudder Investments (investment adviser) (and its predecessor firms).      234    Trustee (2000- Present) and Chair (2010-2017), Newberry Library; Trustee, Chikaming Open Lands (2014-Present); formerly, Trustee, Mather LifeWays (2001-2021); Trustee, certain funds in the Oppenheimer Funds complex (2012-2019); Board Chair (2008-2015) and Director (2004-2018), United Educators Insurance Company; Independent Director, First American Funds (2003-2011); Trustee (1992-2007), Chair of the Board of Trustees (1999-2007), Investment Committee Chair (1994-1999) and Investment Committee member (2007-2010), Wellesley College; Trustee, BoardSource (2006-2009); Trustee, Chicago City Day School (1994-2005).

*

This is the date the Independent Trustee began serving the Trust. Each Independent Trustee serves an indefinite term, until his or her successor is elected.

**

Fund Complex includes all open- and closed-end funds (including all of their portfolios) advised by the Adviser and any affiliated person of the Adviser.

 

  26  

 

 


Trustees and Officers–(continued)

Name, Address and Year of

Birth of Independent Trustees

  

Position(s)

Held

with Trust        

  

Term of

Office

and

Length of        

Time

Served*

  

Principal

Occupation(s) During

the Past 5 Years

    

Number of

Portfolios

in Fund

Complex**

Overseen by        

Independent

Trustees

  

Other

Directorships

Held by

Independent

Trustees During

the Past 5 Years        

Marc M. Kole–1960

c/o Invesco Capital

Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Chair of the Audit Committee and Trustee    Chair of the Audit Committee and Trustee since 2008    Formerly, Managing Director of Finance (2020-2021) and Senior Director of Finance (2015-2020), By The Hand Club for Kids (not-for-profit); Chief Financial Officer, Hope Network (social services) (2008-2012); Assistant Vice President and Controller, Priority Health (health insurance) (2005-2008); Regional Chief Financial Officer, United Healthcare (2005); Chief Accounting Officer, Senior Vice President of Finance, Oxford Health Plans (2000-2004); Audit Partner, Arthur Andersen LLP (1996-2000).      234    Formerly, Treasurer (2018-2021), Finance Committee Member (2015-2021) and Audit Committee Member (2015), Thornapple Evangelical Covenant Church; Board and Finance Committee Member (2009-2017) and Treasurer (2010-2015, 2017), NorthPointe Christian Schools.

Yung Bong Lim–1964

c/o Invesco Capital

Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Chair of the Investment Oversight Committee and Trustee    Chair of the Investment Oversight Committee since 2014; Trustee since 2013    Managing Partner, RDG Funds LLC (real estate) (2008-Present); formerly, Managing Director, Citadel LLC (1999-2007).      234    Board Director, Beacon Power Services, Corp. (2019-Present); formerly, Advisory Board Member, Performance Trust Capital Partners, LLC (2008-2020).

*

This is the date the Independent Trustee began serving the Trust. Each Independent Trustee serves an indefinite term, until his or her successor is elected.

**

Fund Complex includes all open- and closed-end funds (including all of their portfolios) advised by the Adviser and any affiliated person of the Adviser.

 

  27  

 

 


Trustees and Officers–(continued)

Name, Address and Year of

Birth of Independent Trustees

  

Position(s)

Held

with Trust        

  

Term of

Office

and

Length of        

Time

Served*

  

Principal

Occupation(s) During

the Past 5 Years

    

Number of

Portfolios

in Fund

Complex**

Overseen by        

Independent

Trustees

  

Other

Directorships

Held by

Independent

Trustees During

the Past 5 Years        

Joanne Pace–1958

c/o Invesco Capital

Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Trustee    Since 2019    Formerly, Senior Advisor, SECOR Asset Management, LP (2010-2011); Managing Director and Chief Operating Officer, Morgan Stanley Investment Management (2006-2010); Partner and Chief Operating Officer, FrontPoint Partners, LLC (alternative investments) (2005-2006); Managing Director (2003-2005), Global Head of Human Resources and member of Executive Board and Operating Committee (2004-2005), Global Head of Operations and Product Control (2003-2004), Credit Suisse (investment banking); Managing Director (1997-2003), Controller and Principal Accounting Officer (1999-2003), Chief Financial Officer (temporary assignment) for the Oversight Committee, Long Term Capital Management (1998-1999), Morgan Stanley.      234    Board Director, Horizon Blue Cross Blue Shield of New Jersey (2012- Present); Governing Council Member (2016-Present) and Chair of Education Committee (2017-2021), Independent Directors Council (IDC); Council Member, New York-Presbyterian Hospital’s Leadership Council on Children’s and Women’s Health (2012-Present); formerly, Advisory Board Director, The Alberleen Group LLC (2012-2021); Board Member, 100 Women in Finance (2015-2020); Trustee, certain funds in the Oppenheimer Funds complex (2012-2019); Lead Independent Director and Chair of the Audit and Nominating Committee of The Global Chartist Fund, LLC, Oppenheimer Asset Management (2011-2012); Board Director, Managed Funds Association (2008-2010); Board Director (2007-2010) and Investment Committee Chair (2008-2010), Morgan Stanley Foundation.

*

This is the date the Independent Trustee began serving the Trust. Each Independent Trustee serves an indefinite term, until his or her successor is elected.

**

Fund Complex includes all open- and closed-end funds (including all of their portfolios) advised by the Adviser and any affiliated person of the Adviser.

 

  28  

 

 


Trustees and Officers–(continued)

Name, Address and Year of

Birth of Independent Trustees

  

Position(s)

Held

with Trust        

  

Term of

Office

and

Length of        

Time

Served*

  

Principal

Occupation(s) During

the Past 5 Years

  

Number of

Portfolios

in Fund

Complex**

Overseen by        

Independent

Trustees

  

Other

Directorships

Held by

Independent

Trustees During

the Past 5 Years        

Gary R. Wicker–1961

c/o Invesco Capital

Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Trustee    Since 2013    Senior Vice President of Global Finance and Chief Financial Officer, RBC Ministries (publishing company) (2013-Present); formerly, Executive Vice President and Chief Financial Officer, Zondervan Publishing (a division of Harper Collins/NewsCorp) (2007-2012); Senior Vice President and Group Controller (2005- 2006), Senior Vice President and Chief Financial Officer (2003-2004), Chief Financial Officer (2001-2003), Vice President, Finance and Controller (1999-2001) and Assistant Controller (1997-1999), divisions of The Thomson Corporation (information services provider); Senior Audit Manager (1994-1997), PricewaterhouseCoopers LLP.    234    Board Member and Treasurer, Our Daily Bread Ministries Canada (2015- Present); Board and Finance Committee Member, West Michigan Youth For Christ (2010- Present).

Donald H. Wilson–1959

c/o Invesco Capital

Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Chair of the Board and Trustee   

Chair since 2012;

Trustee since 2008

   Chair, President and Chief Executive Officer, McHenry Bancorp Inc. and McHenry Savings Bank (subsidiary) (2018-Present); formerly, Chair and Chief Executive Officer, Stone Pillar Advisors, Ltd. (2010-2017); President and Chief Executive Officer, Stone Pillar Investments, Ltd. (advisory services to the financial sector) (2016-2018); Chair, President and Chief Executive Officer, Community Financial Shares, Inc. and Community Bank–Wheaton/Glen Ellyn (subsidiary) (2013-2015); Chief Operating Officer, AMCORE Financial, Inc. (bank holding company) (2007-2009); Executive Vice President and Chief Financial Officer, AMCORE Financial, Inc. (2006-2007); Senior Vice President and Treasurer, Marshall & Ilsley Corp. (bank holding company) (1995-2006).    234    Director, Penfield Children’s Center (2004-Present); Board Chair, Gracebridge Alliance, Inc. (2015-Present).

*

This is the date the Independent Trustee began serving the Trust. Each Independent Trustee serves an indefinite term, until his or her successor is elected.

**

Fund Complex includes all open- and closed-end funds (including all of their portfolios) advised by the Adviser and any affiliated person of the Adviser.

 

  29  

 

 


Trustees and Officers–(continued)

The Interested Trustee and the executive officers of the Trust, their term of office and length of time served, their principal business occupations during at least the past five years, the number of portfolios in the Fund Complex overseen by the Interested Trustee and the other directorships, if any, held by the Interested Trustee are shown below:

Name, Address and Year of Birth    

of Interested Trustee

  

Position(s)

Held

with Trust        

  

Term of

Office

and

Length of        

Time

Served*

  

Principal

Occupation(s) During

the Past 5 Years

  

Number of

Portfolios

in Fund

Complex**

Overseen by        

Interested

Trustee

  

Other

Directorships

Held by

Interested

Trustee During

the Past 5 Years        

Anna Paglia–1974

Invesco Capital

Management LLC

3500 Lacey Road

Suite 700

Downers Grove, IL 60515

   Trustee, President and Principal Executive Officer    Trustee since 2022, President and Principal Executive Officer since 2020    President and Principal Executive Officer (2020-Present) and Trustee (2022-Present), Invesco Exchange- Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust,    234    None
         Invesco Actively Managed Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust; Managing Director and Global Head of ETFs and Indexed Strategies, Chief Executive Officer and Principal Executive Officer, Invesco Capital Management LLC (2020-Present); Chief Executive Officer,      
         Manager and Principal Executive Officer, Invesco Specialized Products, LLC (2020-Present); Vice President, Invesco Indexing LLC (2020-Present); formerly, Secretary, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded Fund Trust (2011-2020),      
         Invesco Actively Managed Exchange-Traded Commodity Fund Trust (2014-2020) and Invesco Exchange-Traded Self-Indexed Fund Trust (2015- 2020); Head of Legal (2010-2020) and Secretary (2015-2020), Invesco Capital Management LLC; Manager and Assistant Secretary, Invesco Indexing LLC (2017-2020); Head of Legal and Secretary, Invesco Specialized Products, LLC (2018-2020); Partner, K&L Gates LLP (formerly, Bell Boyd & Lloyd LLP) (2007-2010); and Associate Counsel at Barclays Global Investors Ltd. (2004-2006).      

*

This is the date the Interested Trustee began serving the Trust. The Interested Trustee serves an indefinite term, until his successor is elected.

**

Fund Complex includes all open- and closed-end funds (including all of their portfolios) advised by the Adviser and any affiliated person of the Adviser.

 

  30  

 

 


Trustees and Officers–(continued)

Name, Address and Year of Birth    

of Executive Officers

  

Position(s)

Held

with Trust        

  

Length of        

Time

Served*

  

Principal

Occupation(s) During

the Past 5 Years

Adrien Deberghes–1967

Invesco Capital

Management LLC

11 Greenway Plaza, Suite 1000

Houston, TX 77046

   Vice President    Since 2020    Vice President, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively Managed Exchange- Traded Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust (2020-Present); Head of the Fund Office of the CFO, Fund Administration and Vice President, Invesco Advisers, Inc. (2020-Present); Principal Financial Officer, Treasurer and Vice President, The Invesco Funds (2020-Present); formerly, Senior Vice President and Treasurer, Fidelity Investments (2008-2020).

Kelli Gallegos–1970

Invesco Capital

Management LLC

11 Greenway Plaza, Suite 1000

Houston, TX 77046

   Vice President and Treasurer    Since 2018    Vice President, Invesco Advisers, Inc. (2020-Present); Principal Financial and Accounting Officer- Pooled Investments, Invesco Specialized Products, LLC (2018-Present); Vice President and Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust (2018-Present); Principal Financial and Accounting Officer-Pooled Investments, Invesco Capital Management LLC (2018-Present); Vice President and Assistant Treasurer (2008-Present), The Invesco Funds; formerly, Principal Financial Officer (2016-2020) and Assistant Vice President (2008-2016), The Invesco Funds; Assistant Treasurer, Invesco Specialized Products, LLC (2018); Assistant Treasurer, Invesco Exchange- Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded Fund Trust (2012-2018), Invesco Actively Managed Exchange-Traded Commodity Fund Trust (2014-2018) and Invesco Exchange-Traded Self-Indexed Fund Trust (2016-2018); and Assistant Treasurer, Invesco Capital Management LLC (2013-2018).

Adam Henkel–1980

Invesco Capital

Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Secretary    Since 2020    Head of Legal and Secretary, Invesco Capital Management LLC and Invesco Specialized Products, LLC (2020-present); Secretary, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange- Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Commodity Fund Trust and Invesco Exchange-Traded Self-Indexed Fund Trust (2020-Present); Assistant Secretary, Invesco Capital Markets, Inc. (2020-Present); Assistant Secretary, The Invesco Funds (2014-Present); Manager and Assistant Secretary, Invesco Indexing LLC (2020-Present); Assistant Secretary, Invesco Investment Advisers LLC (2020-Present); formerly, Assistant Secretary of Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange- Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded Commodity Fund Trust (2014-2020); Chief Compliance Officer of Invesco Capital Management LLC (2017); Chief Compliance Officer of Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust and Invesco Actively Managed Exchange-Traded Commodity Fund Trust (2017); Senior Counsel, Invesco, Ltd. (2013-2020); Assistant Secretary, Invesco Specialized Products, LLC (2018-2020).

*

This is the date each Officer began serving the Trust in their current position. Each Officer serves an indefinite term, until his or her successor is elected.

 

  31  

 

 


Trustees and Officers–(continued)

Name, Address and Year of Birth    

of Executive Officers

  

Position(s)

Held

with Trust        

  

Length of        

Time

Served*

   Principal Occupation(s) During the Past 5 Years

Peter Hubbard–1981

Invesco Capital

Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Vice President    Since 2009    Vice President, Invesco Specialized Products, LLC (2018-Present); Vice President, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust (2009-Present), Invesco Actively Managed Exchange-Traded Commodity Fund Trust (2014-Present) and Invesco Exchange-Traded Self-Indexed Fund Trust (2016-Present); Vice President and Director of Portfolio Management, Invesco Capital Management LLC (2010-Present); and Vice President, Invesco Advisers, Inc. (2020-Present); formerly, Vice President of Portfolio Management, Invesco Capital Management LLC (2008-2010); Portfolio Manager, Invesco Capital Management LLC (2007-2008); Research Analyst, Invesco Capital Management LLC (2005-2007); Research Analyst and Trader, Ritchie Capital, a hedge fund operator (2003-2005).

Sheri Morris–1964

Invesco Capital

Management LLC

11 Greenway Plaza, Suite 1000

Houston, TX 77046

   Vice President    Since 2012    Head of Global Fund Services, Invesco Ltd. (2019-Present); Vice President, OppenheimerFunds, Inc. (2019-Present); President and Principal Executive Officer, The Invesco Funds (2016-Present); Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser) (2020-Present); Director, Invesco Trust Company (2022-Present) and Vice President, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust (2012-Present), Invesco Actively Managed Exchange-Traded Commodity Fund Trust (2014-Present) and Invesco Exchange-Traded Self-Indexed Fund Trust (2016-Present); formerly, Treasurer (2008-2020), Vice President and Principal Financial Officer, The Invesco Funds (2008-2016); Treasurer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust and Invesco Actively Managed Exchange- Traded Fund Trust (2011-2013); Vice President, Invesco Aim Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc.; Treasurer, Assistant Vice President and Assistant Treasurer, The Invesco Funds and Assistant Vice President, Invesco Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc.; Vice President, Invesco Advisers, Inc. (2009-2020).

Rudolf E. Reitmann–1971

Invesco Capital

Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Vice President    Since 2013    Head of Global Exchange Traded Funds Services, Invesco Specialized Products, LLC (2018-Present); Vice President, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust (2013-Present), Invesco Actively Managed Exchange-Traded Commodity Fund Trust (2014-Present) and Invesco Exchange-Traded Self-Indexed Fund Trust (2016-Present); Head of Global Exchange Traded Funds Services, Invesco Capital Management LLC (2013-Present); Vice President, Invesco Capital Markets, Inc. (2018-Present).

*

This is the date each Officer began serving the Trust in their current position. Each Officer serves an indefinite term, until his or her successor is elected.

 

  32  

 

 


Trustees and Officers–(continued)

Name, Address and Year of Birth    

of Executive Officers

  

Position(s)

Held

with Trust        

  

Length of        

Time

Served*

  

Principal

Occupation(s) During

the Past 5 Years

Melanie Zimdars–1976

Invesco Capital Management LLC

3500 Lacey Road, Suite 700

Downers Grove, IL 60515

   Chief Compliance Officer    Since 2017    Chief Compliance Officer, Invesco Specialized Products, LLC (2018-Present); Chief Compliance Officer, Invesco Capital Management LLC (2017-Present); Chief Compliance Officer, Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Commodity Fund Trust and Invesco Exchange- Traded Self-Indexed Fund Trust (2017-Present); formerly, Vice President and Deputy Chief Compliance Officer, ALPS Holding, Inc. (2009-2017); Mutual Fund Treasurer/ Chief Financial Officer, Wasatch Advisors, Inc. (2005-2008); Compliance Officer, U.S. Bancorp Fund Services, LLC (2001-2005).

*

This is the date each Officer began serving the Trust in their current position. Each Officer serves an indefinite term, until his or her successor is elected.

Availability of Additional Information About the Trustees

The Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request at (800) 983-0903.

 

  33  

 

 


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Proxy Voting Policies and Procedures

A description of the Trust’s proxy voting policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available, without charge and upon request, by calling (800) 983-0903. This information is also available on the Securities and Exchange Commission’s (the “Commission”) website at www.sec.gov .

Information regarding how the Fund voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is available, without charge and upon request, by (i) calling (800) 983-0903; or (ii) accessing the Trust’s Form N-PX on the Commission’s website at www.sec.gov .

Quarterly Portfolios

The Trust files its complete schedule of portfolio holdings for the Fund with the Commission for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Forms N-PORT are available on the Commission’s website at www.sec.gov .

Frequency Distribution of Discounts and Premiums

A table showing the number of days the market price of the Fund’s shares was greater than the Fund’s net asset value, and the number of days it was less than the Fund’s net asset value (i.e., premium or discount) for the most recently completed calendar year, and the calendar quarters since that year end (or the life of the Fund, if shorter) may be found at the Fund’s website at www.invesco.com/ETFs .


©2022 Invesco Capital Management LLC

3500 Lacey Road, Suite 700

       
Downers Grove, IL 60515      P-PIN-AR-1    invesco.com/ETFs