Domestic Equity Market Overview

The fiscal year ended October 31, 2022 began with continued volatility in equity markets in the fourth quarter of 2021 amid substantial inflation and the emergence of a new COVID-19 variant. Pandemic-related supply chain disruption and labor shortages intensified during the quarter, resulting in broadly higher input costs for companies and consumers alike. Additionally, the price of oil rose,¹ causing higher gas prices for consumers, and the Consumer Price Index (CPI) reported for November 2021 increased 0.8%, resulting in a 6.8% increase over the prior 12 months, the highest since 1982.² To combat inflation, the US Federal Reserve (the Fed) announced the potential for three or more interest rate increases in 2022. With solid corporate earnings and optimism about the COVID-19 Omicron variant reporting milder symptoms, stocks rallied at the 2021 year-end.

Equity markets declined in the first quarter of 2022 amid volatility sparked by Russia’s invasion of Ukraine, rising commodity prices, rampant global inflation and the Fed’s shift toward tighter monetary policy. Russia’s invasion exacerbated inflation pressures, disrupting already strained supply chains and increasing shortages of oil, gas and raw materials. The price of oil rose sharply, with crude prices reaching their highest price per barrel since 2008.¹ Inflation continued to be a top concern for consumers, investors and the Fed. To combat inflation, the Fed raised the federal funds rate by one-quarter percentage point in March and the Fed indicated it would “taper” its asset purchase program quickly.³

As the war in Ukraine continued and corporate earnings in high-profile names like Netflix reported slowing growth and profits, the equity markets sold off for much of April 2022. The downward direction of the equity markets continued into the second quarter of 2022 amid record inflation, rising interest rates and an increasing likelihood of a US recession. Driven by higher food and energy prices, the CPI rose by yet another 40-year high to 8.6% for the 12 months ended May 2022.² Oil prices peaked near $122 per barrel in early June, resulting in skyrocketing gasoline prices; the national average price reached a record high above $5 per gallon in early June.¹ To tame inflation, the Fed raised the benchmark federal funds rate three more times, by 0.50% in May, by 0.75% in June and another 0.75% in July, which were the largest increases in nearly 30 years.³ US equity markets rose in July and much of August until Fed chairman Jerome Powell’s hawkish comments at an economic policy symposium held in Jackson Hole, Wyoming, sparked a sharp selloff at month-end. The Fed reiterated that it would continue taking aggressive action to curb inflation, even though such measures could “bring pain to households and businesses,” and the Fed raised the benchmark federal funds rate by another 0.75% in September.³

After experiencing a sharp drop in September 2022, US equity markets rebounded in October with strong gains, despite mixed data on the economy and corporate earnings. Inflation data

reported in October came in higher than expected; however, the labor market remained strong, with payroll employment gains and a decline in the unemployment rate to a near record low of 3.5% in September.² The initial estimate of third quarter real gross domestic product showed an increase of 2.6% (annualized) after falling in the prior two quarters, but the headline number masked a drop in demand and investment. Corporate earnings were generally in line with expectations, but many companies’ forward earnings guidance was weaker than expected.

In this environment, US stocks had negative double-digit returns for the fiscal year ended October 31, 2022 of -14.61%, as measured by the S&P 500 Index.⁴

 

1	Source: Bloomberg LP

2	Source: US Bureau of Labor Statistics

3	Source: US Federal Reserve

4	Source: Lipper Inc.

Fixed Income

In the fourth quarter of 2021, concerns about inflation heightened as US inflation rose 7%,¹ its highest level in nearly 40 years. Though the US Federal Reserve (the Fed) left policy rates unchanged during the quarter, the Fed indicated its accommodative policies were coming to an end in 2022 through a willingness to raise interest rates to combat inflation and the announced reduction of its monthly bond purchase program. Additionally, US interest rate moves and inflation risk significantly affected fixed income valuations during the quarter. The two-year Treasury yield rose moderately from 0.27% to 0.73%, while the 10-year increased slightly from 1.48% to 1.52% during the quarter.² The yield curve, as measured by the yield differential between two- and 10-year Treasuries, flattened during the quarter.

At the beginning of 2022, geopolitical and economic tensions between Ukraine and Russia culminated with the latter invading Ukrainian territory. World leaders levied sanctions against Russia that had material effects on its fixed income markets, particularly sovereign debt and corporates, and levels of liquidity. The Russia-Ukraine war exacerbated inflationary pressures while also exerting downward pressure on economic growth through a surge in commodity/energy prices. Additionally, surges of COVID-19 in China exacerbated supply chain issues and aggravated inflation. During the second quarter of 2022, the two-year Treasury yield rose significantly from 0.78% to 2.28%, while the 10-year increased slightly from 1.63% to 2.32%.²

In the second quarter of 2022, the macro backdrop of tightening financial conditions and slowing economic growth was negative for credit asset classes. Inflation, as measured by the Consumer Price Index, increased further to 9.1% and fixed income markets experienced significant negative performance as all bond sectors felt the impact of rising interest rates with negative performance ranging from -0.9% (Bloomberg Asset-Backed Securities) to

-9.8% (Bloomberg US Corporate High Yield).³ Credit spreads increased across all major credit-sensitive sectors, reflecting anticipation of an economic slowdown and increasing concerns about recession risk, with corporate spreads ending the second quarter above their long-term historical average. The Fed continued its rapid tightening of monetary policy in an effort to combat inflation via higher interest rates while simultaneously engineering a soft landing so as to not push the economy into a recession. The Fed aggressively raised its key Fed funds rate during the fiscal year, including a 0.50% hike in May, and three 0.75% hikes in June, July and November, the largest hikes since 1994, to a target Fed funds rate of 3.75-4.00%, the highest since 2008.⁴ At their November 2022 meeting, the Fed signaled that its hawkish policies would continue, though a slowing of the pace of rate increases was likely. While rates remained elevated across all maturities on the yield curve, the two-year Treasury rates increased from 2.92% to 4.51% during the fiscal year, while 10-year Treasury rates increased from 2.98% to 4.10%.² At the end of the fiscal year, the yield curve remained inverted, which historically has been an indicator of a potential recession.

 

1	Source: US Bureau of Labor Statistics

2	Source: US Department of the Treasury

3	Source: Bloomberg

4	Source: Federal Reserve of Economic Data

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.

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.

The Invesco Active U.S. Real Estate ETF (the “Fund”) is an actively managed exchange-traded fund whose investment objective is to achieve high total return through growth of capital and current income. The Fund seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its assets in securities of companies that are principally engaged in the U.S. real estate industry and included within the FTSE NAREIT All Equity REITs Index (the “Benchmark Index”). The Fund considers a company to be principally engaged in the U.S. real estate industry if it: (i) derives 50% of its revenues or profits from the ownership, leasing, management, construction, financing or sale of U.S. real estate; or (ii) has at least 50% of the value of its assets invested in U.S. real estate. The Fund plans to invest principally in equity real estate investment trusts (“REITs”). Equity REITs pool investors’ funds for investments primarily in real estate properties or real estate-related loans (such as mortgages). The Fund also may invest in real estate operating companies (“REOCs”), as well as securities of other companies principally engaged in the U.S. real estate industry. REOCs are similar to REITs, except that REOCs reinvest their earnings into the business, rather than distributing them to unitholders like REITs.

For the fiscal year ended October 31, 2022, on a market price basis, the Fund returned (18.65)%. On a net asset value (“NAV”) basis, the Fund returned (18.66)%. During the same time period, the Benchmark Index returned (19.16)%.

Relative to the Benchmark Index, the Fund was most overweight in the specialized REITs sub-industry and most underweight in the retail REITs sub-industry during the fiscal year ended October 31, 2022. The majority of the Fund’s outperformance relative to the Benchmark Index during the period can be attributed to the Fund’s security selection in the industrial REITs and office REITs sub-industries, respectively.

For the fiscal year ended October 31, 2022, no sub-industries contributed positively to the Fund’s return. During the period, the specialized REITs and residential REITs sub-industries detracted most from the Fund’s return.

Positions that contributed most significantly to the Fund’s return for the fiscal year ended October 31, 2022 included CoreSite Realty Corp., an specialized REITs company (no longer held at fiscal year-end), and Veris Residential, Inc., an office REIT company (portfolio average weight of 0.27%). Positions that detracted most significantly from the Fund’s return included Crown Castle Inc., a specialized REIT company (portfolio average weight of 6.19%), and American Tower Corp., a specialized REIT company (portfolio average weight of 6.18%).

Property Type and Sub-Industry Breakdown (% of the Fund’s Net Assets) as of October 31, 2022
Infrastructure REITs			18.67
Industrial			10.84
Apartments			10.42
Self Storage			8.85
Data Centers			7.91
Health Care			7.12
Shopping Centers			6.36
Free Standing			5.43
Specialty			4.77
Office			4.42
Manufactured Homes			3.53
Diversified			3.38
Timber REITs			2.68
Lodging Resorts			2.65
Single Family Homes			2.19
Regional Malls			0.82
Money Market Funds Plus Other Assets Less Liabilities			(0.04)
Top Ten Fund Holdings* (% of the Fund’s Net Assets) as of October 31, 2022
Security
American Tower Corp.			6.39
SBA Communications Corp., Class A			6.33
Crown Castle, Inc.			5.95
Digital Realty Trust, Inc.			3.96
Equinix, Inc.			3.95
CubeSmart			1.81
Public Storage			1.77
Life Storage, Inc.			1.76
Extra Space Storage, Inc.			1.76
National Storage Affiliates Trust			1.75
Total			35.43

 

*	Excluding money market fund holdings.

Fund Inception: November 20, 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, as supplemented to date, the Fund’s expense ratio of 0.35% 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 index stated above 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 index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.

Notes Regarding Index and Fund Performance History:

 

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

The Invesco Balanced Multi-Asset Allocation ETF (the “Fund”) is an actively managed exchange-traded fund (“ETF”) which seeks to provide current income and capital appreciation. The Fund is a “fund of funds,” meaning that it invests its assets primarily in other ETFs (“Underlying ETFs”), rather than in securities of individual companies. Under normal circumstances, most of those Underlying ETFs will be ETFs that are advised by the Fund’s adviser or one of its affiliates (the “Invesco ETFs”). However, at times the Fund also may invest a portion of its assets in Underlying ETFs that are advised by unaffiliated advisers. The Fund and the Invesco ETFs are part of the same group of investment companies. The Fund seeks to achieve its investment objective by allocating its assets using a balanced investment style that seeks to maximize the benefits of diversification, which focuses on investing portions of the Fund’s assets both in Underlying ETFs that invest primarily in fixed-income securities (“Fixed Income ETFs”) as well as in Underlying ETFs that invest primarily in equity securities (“Equity ETFs”).

Invesco Advisers, Inc., the Fund’s sub-adviser, uses the following investment process to construct the Fund’s portfolio: (1) a strategic allocation across broad asset classes (i.e., equities and fixed income securities) and particular investment factors within those classes (e.g., for fixed income securities, exposure to domestic, international, corporate, government, high-yield and investment grade bonds; for equity securities, exposure to domestic and international issuers); (2) selection of Underlying ETFs that best represent those broad asset classes and factor exposures, based on a comprehensive quantitative and qualitative criteria (such as management experience and structure, investment process, performance and risk metrics); (3) determination by the Fund’s sub-adviser of target weightings in each Underlying ETF in a manner that seeks to manage the amount of active risk contributed by each Underlying ETF; and (4) ongoing monitoring of the Fund’s performance and risk. The Fund typically holds a limited number of securities (generally 10-20).

For the fiscal year ended October 31, 2022, on a market price basis, the Fund returned (13.44)%. On a net asset value (“NAV”) basis, the Fund returned (13.54)%. During the same time period, the Custom Invesco Balanced Allocation ETF Index (the “Benchmark Index”) returned (18.04)%, while the S&P 500^® Index returned (14.61)%.

The Fund’s performance, on a NAV basis, was higher than the return of the Benchmark Index during the period primarily due to the Fund’s higher relative exposure to U.S. equity securities. Exposure to small and mid-cap equity securities, along with exposure to non-U.S. developed equities, also contributed to the Fund’s relative performance. The Fund’s performance, on a NAV basis, was higher than the return of the S&P 500^® Index during the period primarily due to the Fund’s lower relative exposure to U.S. equities.

For the fiscal year ended October 31, 2022, from an asset class perspective, there were no positive contributors to the Fund’s performance. Exposure to fixed income through the Underlying ETFs were the largest detractors to the Fund’s absolute return, followed by U.S. equity.

There were no positions that positively contributed to the Fund’s absolute return. Positions that detracted most significantly from the Fund’s absolute return included the Invesco 1-30 Laddered Treasury ETF (portfolio average weight of 9.75%) and the Invesco Taxable Municipal Bond ETF (portfolio average weight of 8.46%).

 

Market Segment Breakdown (% of the Fund’s Net Assets)* as of October 31, 2022
U.S. Equities			48.66
Fixed Income			37.33
International and Developed Equities			8.78
Emerging Markets Equities			5.20
Money Market Funds Plus Other Assets Less Liabilities			0.03

 

*	Reflects exposure achieved through investments in underlying funds.

Top Ten Fund Holdings* (% of the Fund’s Net Assets) as of October 31, 2022
Security
Invesco S&P 500® Pure Growth ETF			13.46
Invesco 1-30 Laddered Treasury ETF			11.86
Invesco RAFI™ Strategic US ETF			11.77
Invesco Russell 1000 Dynamic Multifactor ETF			8.60
Invesco Taxable Municipal Bond ETF			5.30
Invesco Variable Rate Investment Grade ETF			4.84
Invesco S&P 500® Low Volatility ETF			4.60
Invesco RAFI™ Strategic Developed ex-US ETF			4.45
Invesco S&P International Developed Low Volatility ETF			4.33
Invesco Fundamental High Yield® Corporate Bond ETF			3.95
Total			73.16

 

*	Excluding money market fund holdings.

Fund Inception: February 23, 2017

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 0.32% includes the unitary management fee of 0.05% and acquired fund fees and expenses of 0.27%. 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 stated above 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 the indexes are based on the inception date of the Fund.

 

-	The Benchmark Index is a custom benchmark that consists of 60% MSCI ACWI Index (Net) and 40% Bloomberg U.S. Aggregate Bond Index.

The Invesco Conservative Multi-Asset Allocation ETF (the “Fund”) is an actively managed exchange-traded fund (“ETF”) which seeks total return consistent with a lower level of risk relative to the broad stock market. The Fund is a “fund of funds,” meaning that it invests its assets primarily in other ETFs (“Underlying ETFs”), rather than in securities of individual companies. Under normal circumstances, most of those Underlying ETFs will be ETFs that are advised by the Fund’s adviser or one of its affiliates (the “Invesco ETFs”). However, at times the Fund also may invest a portion of its assets in Underlying ETFs that are advised by unaffiliated advisers. The Fund and the Invesco ETFs are part of the same group of investment companies. The Fund seeks to achieve its investment objective by allocating its assets using a conservative investment style that seeks to maximize the benefits of diversification, which focuses on investing a greater portion of the Fund’s assets in Underlying ETFs that invest primarily in fixed- income securities (“Fixed Income ETFs”), but also provides some exposure to Underlying ETFs that invest primarily in equity securities (“Equity ETFs”).

Invesco Advisers, Inc., the Fund’s sub-adviser, uses the following investment process to construct the Fund’s portfolio: (1) a strategic allocation across broad asset classes (i.e., equities and fixed income securities) and particular investment factors within those classes (e.g., for fixed income securities, exposure to domestic, international, corporate, government, high-yield and investment grade bonds; for equity securities, exposure to domestic and international issuers); (2) selection of Underlying ETFs that best represent those broad asset classes and factor exposures, based on comprehensive quantitative and qualitative criteria (such as management experience and structure, investment process, performance and risk metrics); (3) determination by the Fund’s sub-adviser of target weightings in each Underlying ETF in a manner that seeks to manage the amount of active risk contributed by each Underlying ETF; and (4) ongoing monitoring of the Fund’s performance and risk. The Fund typically holds a limited number of securities (generally 10-20).

For the fiscal year ended October 31, 2022, on a market price basis, the Fund returned (13.29)%. On a net asset value (“NAV”) basis, the Fund returned (13.22)%. During the same time period, the Custom Invesco Conservative Allocation ETF Index (the “Benchmark Index”) returned (16.40)%, while the S&P 500^® Index returned (14.61)%.

The Fund’s performance, on a NAV basis, was higher than the return of the Benchmark Index during the period primarily due to the Fund’s security selection in fixed income securities. Exposure to U.S. equities, along with small and mid-cap equities, also contributed to the Fund’s relative performance. The Fund’s performance, on a NAV basis, was higher than the return of the S&P 500^® Index during the period primarily due to the Fund’s lower relative exposure to U.S. equities. For the fiscal year ended

October 31, 2022, from an asset class perspective, there were no positive contributors to the Fund’s performance. Exposure to fixed income through Underlying ETFs was the largest detractor to the Fund’s absolute return, followed by exposure to U.S. equities.

There were no positions that positively contributed to the Fund’s absolute return. Invesco Taxable Municipal Bond ETF (portfolio average weight of 17.06%) along with the Invesco 1-30 Laddered Treasury ETF (portfolio average weight of 11.47%) and the Invesco Fundamental High Yield^® Corporate Bond ETF (portfolio average weight of 12.57%) detracted from the Fund’s absolute return.

 

Market Segment Breakdown (% of the Fund’s Net Assets)* as of October 31, 2022
Fixed Income			76.01
U.S. Equities			19.28
International and Developed Equities			3.63
Emerging Markets Equities			1.05
Money Market Funds Plus Other Assets Less Liabilities			0.03

 

*	Reflects exposure achieved through investments in underlying funds.

Top Ten Fund Holdings* (% of the Fund’s Net Assets) as of October 31, 2022
Security
Invesco Taxable Municipal Bond ETF			16.40
Invesco 1-30 Laddered Treasury ETF			13.51
Invesco Fundamental High Yield® Corporate Bond ETF			13.00
Invesco Variable Rate Investment Grade ETF			11.77
Invesco PureBetaSM 0-5 Yr US TIPS ETF			6.66
Invesco Senior Loan ETF			5.20
Invesco S&P 500® Pure Growth ETF			4.98
Invesco Investment Grade Defensive ETF			3.86
Invesco Emerging Markets Sovereign Debt ETF			3.50
Invesco Preferred ETF			3.49
Total			82.37

 

*	Excluding money market fund holdings.

Fund Inception: February 23, 2017

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 0.37% includes the unitary management fee of 0.05% and acquired fund fees and expenses of 0.32%. 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 stated above 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 the indexes are based on the inception date of the Fund.

 

-	The Benchmark Index is a custom benchmark that consists of 20% MSCI ACWI Index (Net) and 80% Bloomberg U.S. Aggregate Bond Index.

The Invesco Growth Multi-Asset Allocation ETF (the “Fund”) is an actively managed exchange-traded fund (“ETF”) which seeks to provide long-term capital appreciation. The Fund is a “fund of funds,” meaning that it invests its assets primarily in other ETFs (“Underlying ETFs”), rather than in securities of individual companies. Under normal circumstances, most of those Underlying ETFs will be ETFs that are advised by the Fund’s adviser or one of its affiliates (the “Invesco ETFs”). However, at times the Fund also may invest a portion of its assets in Underlying ETFs that are advised by unaffiliated advisers. The Fund and the Invesco ETFs are part of the same group of investment companies. The Fund seeks to achieve its investment objective by allocating its assets using a growth investment style that seeks to maximize the benefits of diversification, which focuses on investing a greater portion of Fund assets in Underlying ETFs that invest primarily in equity securities (“Equity ETFs”), but also provides some exposure to Underlying ETFs that invest primarily in fixed-income securities (“Fixed Income ETFs”).

Invesco Advisers, Inc., the Fund’s sub-adviser, uses the following investment process to construct the Fund’s portfolio: (1) a strategic allocation across broad asset classes (i.e., equities and fixed income securities) and particular investment factors within those classes (e.g., for fixed income securities, exposure to domestic, international, corporate, government, high-yield and investment grade bonds; for equity securities, exposure to domestic and international stocks); (2) selection of Underlying ETFs that best represent those broad asset classes and factor exposures, based on comprehensive quantitative and qualitative criteria (such as management experience and structure, investment process, performance and risk metrics); (3) determination by the Fund’s sub-adviser of target weightings in each Underlying ETF in a manner that seeks to manage the amount of active risk contributed by each Underlying ETF; and (4) ongoing monitoring of the Fund’s performance and risk. The Fund typically holds a limited number of securities (generally 10-20).

For the fiscal year ended October 31, 2022, on a market price basis, the Fund returned (12.78)%. On a net asset value (“NAV”) basis, the Fund returned (12.83)%. During the same time period, the Custom Invesco Growth Allocation ETF Index (the “Benchmark Index”) returned (18.97)%, while the S&P 500^® Index returned (14.61)%.

The Fund’s performance, on a NAV basis, was higher than the return of the Benchmark Index during the period primarily due to the Fund’s higher relative exposure to U.S. equity securities. Exposure to small and mid-cap equity securities, along with exposure to non-U.S. developed equities, also contributed to the Fund’s relative performance. The Fund’s performance, on a NAV basis, was higher than the return of the S&P 500^® Index during the period primarily due to the Fund’s lower relative exposure to U.S. equities.

For the fiscal year ended October 31, 2022, there were no positive contributors to the Fund’s absolute returns. Exposure to U.S. equities through Underlying ETFs was the largest detractor to the Fund’s absolute return, followed by non-U.S. developed equity.

There were no positions that positively contributed to the Fund’s absolute return. Invesco S&P 500^® Pure Growth ETF (portfolio average weight of 13.49%), Invesco 1-30 Laddered Treasury ETF (portfolio average weight of 7.63%) and Invesco RAFI^TM Strategic Emerging Markets ETF (portfolio average weight of 3.66%) were the largest detractors from the Fund’s absolute return.

 

Market Segment Breakdown (% of the Fund’s Net Assets)* as of October 31, 2022
U.S. Equities			61.53
Fixed Income			19.65
International and Developed Equities			11.73
Emerging Markets Equities			7.09
Money Market Funds Plus Other Assets Less Liabilities			0.00

 

*	Reflects exposure achieved through investments in underlying funds.

Top Ten Fund Holdings* (% of the Fund’s Net Assets) as of October 31, 2022
Security
Invesco S&P 500® Pure Growth ETF			15.44
Invesco RAFI™ Strategic US ETF			14.95
Invesco Russell 1000 Dynamic Multifactor ETF			11.45
Invesco S&P 500® Low Volatility ETF			8.92
Invesco 1-30 Laddered Treasury ETF			8.90
Invesco RAFI™ Strategic Developed ex-US ETF			5.92
Invesco S&P International Developed Low Volatility ETF			5.81
Invesco RAFI™ Strategic US Small Company ETF			4.44
Invesco S&P Emerging Markets Low Volatility ETF			3.80
Invesco S&P MidCap Low Volatility ETF			3.66
Total			83.29

 

*	Excluding money market fund holdings.

Fund Inception: February 23, 2017

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 0.31% includes the unitary management fee of 0.05% and acquired fund fees and expenses of 0.26%. 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 stated above 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 the indexes are based on the inception date of the Fund.

 

-	The Benchmark Index is a custom benchmark that consists of 80% MSCI ACWI Index (Net) and 20% Bloomberg U.S. Aggregate Bond Index.

The Invesco High Yield Bond Factor ETF (the “Fund”) is an actively managed exchange-traded fund (“ETF”) which seeks to provide total return. The Fund seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its net assets (plus the amount of any borrowings for investment purposes) in high-yield, below-investment grade, fixed-income securities (also referred to as “junk” bonds), and in derivatives and other instruments that have economic characteristics similar to such securities.

Invesco Advisers, Inc., the Fund’s sub-adviser, selects securities for the Fund’s portfolio by utilizing a factor-based strategy that involves systematically targeting securities exhibiting quantifiable issuer characteristics (or “factors”) that the sub-adviser believes will have higher returns than other fixed income securities with comparable characteristics over market cycles. In practice, this means the Fund may have higher allocations to: value bonds (bonds that have high spreads relative to other securities of similar credit quality and/or sector); low volatility bonds (bonds that have lower levels of price volatility); and high carry bonds (bonds with higher absolute yield or spread). The portfolio managers expect to include additional factors, modify the factors used to build the Fund’s portfolio, or, alternatively, actively manage the Fund’s portfolio to minimize certain risks, as it deems appropriate.

For the fiscal year ended October 31, 2022, on a market price basis, the Fund returned (12.59)%. On a net asset value (“NAV”) basis, the Fund returned (12.61)%. During the same time period, the Bloomberg U.S. Corporate High Yield 2% Issuer Cap Index (the “Benchmark Index”) returned (11.76)%.

During the same time period, the Fund underperformed the Benchmark Index, driven by the Fund’s large allocation to the industrials sector. The Fund’s performance, on a NAV basis, was less than the return of the Benchmark Index during the period primarily because of the Fund’s security selection in and allocation to the industrials sector and the consumer staples sector. Exposure to the communication services sector also detracted from the Fund’s relative performance.

For the fiscal year ended October 31, 2022, from an industry perspective, exposure in energy equipment & services was the largest contributor to the Fund’s absolute return, followed by independent power and renewable electricity producers. In contrast, exposure to media and pharmaceuticals detracted from the Fund’s performance.

Positions that contributed most significantly to the Fund’s absolute return included the PBF Holding Co. LLC/PBF Finance Corp., 6.00% coupon, due 02/15/2028 (portfolio average weight of 0.10%) and Viasat, Inc., 5.63% coupon, due 09/15/2025 (portfolio average weight of 0.40%). Positions that detracted most significantly from the Fund’s absolute return included

Embarq Corp., 8.00% coupon; due 06/01/2036 (portfolio average weight of 0.30%) and EnfraGen Energia Sur S.A./EnfraGen Spain S.A./Prime Energia S.p.A, 5.38% coupon; due 12/30/2030 (portfolio average weight of 0.40%).

 

Security Type Breakdown (% of the Fund’s Net Assets) as of October 31, 2022
U.S. Dollar Denominated Bonds & Notes			96.58
U.S. Treasury Securities			0.36
Money Market Funds Plus Other Assets Less Liabilities			3.06
Top Ten Fund Holdings* (% of the Fund’s Net Assets) as of October 31, 2022
Security
DIRECTV Financing LLC/DIRECTV Financing Co-Obligor, Inc., 5.88%, 08/15/2027			0.89
TransDigm, Inc., 6.25%, 03/15/2026			0.79
GFL Environmental, Inc., 4.25%, 06/01/2025			0.75
Domtar Corp., 6.75%, 10/01/2028			0.71
Sprint Corp., 7.88%, 09/15/2023			0.70
Sprint Corp., 7.13%, 06/15/2024			0.70
CVR Energy, Inc., 5.25%, 02/15/2025			0.69
Community Health Systems, Inc., 8.00%, 03/15/2026			0.69
Staples, Inc., 7.50%, 04/15/2026			0.67
NGL Energy Operating LLC/NGL Energy Finance Corp., 7.50%, 02/01/2026			0.63
Total			7.22

 

*	Excluding money market fund holdings.

Fund Inception: December 2, 2020

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 0.40% includes the unitary management fee of 0.39% and other expenses of 0.01%. 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 index stated above 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 index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.

Notes Regarding Indexes and Fund Performance History:

 

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

The Invesco Moderately Conservative Multi-Asset Allocation ETF (the “Fund”) is an actively managed exchange-traded fund (“ETF”) which seeks to provide current income and some capital appreciation. The Fund is a “fund of funds,” meaning that it invests its assets primarily in other ETFs (“Underlying ETFs”), rather than in securities of individual companies. Under normal circumstances, most of those Underlying ETFs will be ETFs that are advised by the Fund’s adviser or one of its affiliates (the “Invesco ETFs”). However, at times the Fund also may invest a portion of its assets in Underlying ETFs that are advised by unaffiliated advisers. The Fund and the Invesco ETFs are part of the same group of investment companies. The Fund seeks to achieve its investment objective by allocating its assets using a moderately conservative investment style that seeks to maximize the benefits of diversification, which focuses on investing portions of the Fund’s assets in Underlying ETFs that invest primarily in equity securities (“Equity ETFs”), as well as in Underlying ETFs that invest primarily in fixed-income securities (“Fixed Income ETFs”).

Invesco Advisers, Inc., the Fund’s sub-adviser uses the following investment process to construct the Fund’s portfolio: (1) a strategic allocation across broad asset classes (i.e., equities and fixed income securities) and particular investment factors within those classes (e.g., for fixed income securities, exposure to domestic, international, corporate, government, high-yield and investment grade bonds; for equity securities, exposure to domestic and international stocks); (2) selection of Underlying ETFs that best represent those broad asset classes and factor exposures, based on comprehensive quantitative and qualitative criteria (such as management experience and structure, investment process, performance and risk metrics); (3) determination by the Fund’s sub-adviser of target weightings in each Underlying ETF in a manner that seeks to manage the amount of active risk contributed by each Underlying ETF; and (4) ongoing monitoring of the Fund’s performance and risk. The Fund typically holds a limited number of securities (generally 10-20).

For the fiscal year ended October 31, 2022, on a market price basis, the Fund returned (13.68)%. On a net asset value (“NAV”) basis, the Fund returned (13.56)%. During the same time period, the Custom Invesco Moderately Conservative Allocation ETF Index (the “Benchmark Index”) returned (17.19)%, while the S&P 500^® Index returned (14.61)%.

The Fund’s performance, on a NAV basis, was higher than the return of the Benchmark Index during the period primarily due to the Fund’s higher relative exposure to U.S. equities and fixed income. There were no detractors from the Fund’s relative performance. The Fund’s performance, on a NAV basis, was higher than the return of the S&P 500^® Index during the period primarily due to the Fund’s lower relative exposure to U.S. equities.

For the fiscal year ended October 31, 2022, from an asset class perspective, there were no positive contributors to the Fund’s performance. Exposure to fixed income securities through Underlying ETFs was the largest detractor to the Fund’s absolute return, followed by exposure to U.S. equities.

There were no positions that positively contributed to the Fund’s absolute return. Positions that detracted most significantly from the Fund’s absolute return included Invesco S&P 500^® Pure Growth ETF (portfolio average weight of 13.49%) and Invesco 1-30 Laddered Treasury ETF (portfolio average weight of 7.63%).

 

Market Segment Breakdown (% of the Fund’s Net Assets)* as of October 31, 2022
Fixed Income			56.42
U.S. Equities			34.08
International and Developed Equities			5.89
Emerging Markets Equities			3.59
Money Market Funds Plus Other Assets Less Liabilities			0.02

 

*	Reflects exposure achieved through investments in underlying funds.

Top Ten Fund Holdings* (% of the Fund’s Net Assets) as of October 31, 2022
Security
Invesco Taxable Municipal Bond ETF			12.86
Invesco 1-30 Laddered Treasury ETF			12.77
Invesco S&P 500® Pure Growth ETF			9.09
Invesco RAFI™ Strategic US ETF			8.33
Invesco Fundamental High Yield® Corporate Bond ETF			7.95
Invesco Variable Rate Investment Grade ETF			6.84
Invesco PureBetaSM 0-5 Yr US TIPS ETF			5.68
Invesco Russell 1000 Dynamic Multifactor ETF			5.55
Invesco Senior Loan ETF			3.85
Invesco S&P 500® Low Volatility ETF			3.05
Total			75.97

 

*	Excluding money market fund holdings.

Fund Inception: February 23, 2017

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 0.35% includes the unitary management fee of 0.05% and acquired fund fees and expenses of 0.30%. 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 stated above 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 the indexes are based on the inception date of the Fund.

 

-	The Benchmark Index is a custom benchmark that consists of 40% MSCI ACWI Index (Net) and 60% Bloomberg U.S. Aggregate Bond Index.

The Invesco S&P 500^® Downside Hedged ETF (the “Fund”) is an actively managed exchange-traded fund (“ETF”) that seeks to achieve positive total returns in rising or falling markets that are not directly correlated to broad equity or fixed income market returns. The Fund seeks to achieve its investment objective by allocating its assets generally among the components of the S&P 500^® Dynamic VEQTOR Index (the “Benchmark Index”). The Benchmark Index is composed of up to three types of components: (i) an equity component, represented by the S&P 500^® Index; (ii) a volatility hedge component, represented by the S&P 500^® VIX Short-Term Futures Index (“VIX Futures Index”); and (iii) cash. The Benchmark is designed to measure the performance of the broad equity markets with an implied volatility hedge. “Implied volatility” is a measure of the expected volatility of the S&P 500^® Index that is reflected in the value of the Chicago Board Options Exchange (“CBOE”) Volatility Index (“VIX Index”). Known as the “fear gauge” of the broader U.S. equities market, the VIX Index measures market volatility in large capitalization U.S. stocks and is calculated based on the prices of certain put and call options on the S&P 500^® Index.

The VIX Futures Index is designed to measure the returns from long positions in futures contracts on the VIX Index. The Benchmark Index’s allocation to the VIX Futures Index is designed to serve as a volatility hedge, as volatility historically tends to correlate negatively to the performance of the U.S. equity markets (i.e., rapid declines in the performance of U.S. equity markets generally are associated with high volatility in such markets). Accordingly, pursuant to its methodology, the Benchmark Index allocates a greater portion of its weight to its equity component (the S&P 500^® Index) during periods of low volatility, and a greater portion of its weight to its volatility hedge component (the VIX Futures Index) during periods of increased volatility.

Under normal circumstances, the Fund will invest its portfolio in a combination of assets that are similar, but not necessarily identical, to that of the Benchmark Index. The Fund’s portfolio is composed of: (i) an equity sleeve, consisting of the component securities of the S&P 500^® Index, (ii) a volatility hedge sleeve, consisting of VIX Index-Related Instruments (defined below), which include futures contracts on the VIX Index, (iii) futures contracts that track the S&P 500^® Index (“S&P 500 Futures”); and (iv) various liquid investments, including short-term high quality U.S. Treasury Securities, money market instruments, cash and cash equivalents. With respect to its equity sleeve, the Fund utilizes a “passive” investment strategy that seeks to track the performance of the S&P 500^® Index as closely as possible. To do so, the Fund employs a “full replication” methodology; “full replication” means that the Fund generally invests the portion of its portfolio allocated to its equity sleeve in all of the component securities of the S&P 500^® Index in proportion to their weightings in the S&P 500^® Index. Although the Fund employs a passive strategy with respect to its equity sleeve, Invesco Capital Management LLC (the “Adviser”), the Fund’s adviser, will actively

manage the Fund’s investments in VIX Index-Related Instruments, S&P 500 Futures, short-term instruments and cash, as well as the Fund’s allocation of its assets among the equity and volatility hedge sleeves. Such allocations may not correspond to the Benchmark Index’s allocations. Instead, the Adviser will seek to obtain returns for the Fund that exceed the Benchmark Index by providing the Fund with equity or volatility hedge sleeve allocations that are higher or lower than those of the Benchmark Index at any time given the market conditions at that time.

In addition to its investments in futures contracts on the VIX Index, the Fund may invest in U.S.-listed exchange-traded funds (“ETFs”) and exchange-traded notes (“ETNs”) that provide exposure to the VIX Index (such ETFs and ETNs, along with futures contracts on the VIX Index, are collectively the “VIX Index-Related Instruments”). The Fund may invest in the short-term instruments and cash to provide liquidity or to protect the Fund during periods of heightened volatility when the Adviser believes that it is in the best interest of the Fund to do so.

For the fiscal year ended October 31, 2022, on a market price basis, the Fund returned (3.51)%. On a net asset value (“NAV”) basis, the Fund returned (3.78)%. During the same time period, the Benchmark Index returned (3.33)%. The Fund’s underperformance on a NAV basis, relative to the Benchmark Index was primarily due to fees and transaction costs incurred by the Fund during the fiscal year.

During this same time period, the S&P 500^® Index returned (14.61)% and the U.S. 3-Month Treasury Bill Index (the “T-Bill 3-Month Index”) returned 1.30% (these indexes, collectively with the Benchmark Index, are referred to as the “Indexes”). The Indexes were selected for their recognition in the marketplace. The S&P 500^® Index was selected because its performance comparison is a useful measure for investors as a broad representation of the equity market. The T-Bill 3-Month Index was selected because its performance comparison is a useful measure for investors as a broad representation of the short-term U.S. fixed income market.

The Fund’s performance, on a NAV basis, differed from the return of the S&P 500^® Index during the period primarily because of the Fund’s consistent allocation to VIX futures, which generally have an inverse correlation to the S&P 500^® Index. The Fund’s performance, on a NAV basis, differed from the return of the U.S. 3-Month Treasury Bill Index during the period primarily because of the Fund’s consistent allocation to VIX Futures.

For the fiscal year ended October 31, 2022, the energy sector contributed most significantly to the Fund’s return, followed by the health care sector. The Fund’s VIX futures allocations and exposure to the communication services sector were the largest detractors from the Fund’s return.

Positions that contributed most significantly to the Fund’s return included the CBOE VIX (CBF) Oct 22, a VIX futures contract (portfolio average weight of 1.61%), and the E-Mini S&P 500 (CME) Sep 22 futures contract (portfolio average weight of 3.46%). The positions that detracted most significantly from the Fund’s return were the CBOE VIX (CBF) Apr 22, a VIX futures contract (portfolio average weight of 1.48%), and CBOE VIX (CBF) Jun 22, a VIX futures contract (portfolio average weight of 1.13%).

 

Sector Breakdown (% of the Fund’s Net Assets) as of October 31, 2022
Information Technology			17.97
Health Care			10.47
Financials			7.83
Consumer Discretionary			7.43
Industrials			5.65
Communication Services			5.03
Consumer Staples			4.74
Energy			3.67
Sector Types Each Less Than 3%			5.56
Money Market Funds Plus Other Assets Less Liabilities			31.65

Top Ten Fund Holdings* (% of the Fund’s Net Assets) as of October 31, 2022
Security
Apple, Inc.			4.87
Microsoft Corp.			3.64
Amazon.com, Inc.			1.91
Tesla, Inc.			1.27
Alphabet, Inc., Class A			1.19
Berkshire Hathaway, Inc., Class B			1.12
UnitedHealth Group, Inc.			1.09
Alphabet, Inc., Class C			1.07
Exxon Mobil Corp.			0.97
Johnson & Johnson			0.96
Total			18.09

 

*	Excluding money market fund holdings.

Fund Inception: December 6, 2012

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. The adviser has contractually agreed to waive fees and/or pay certain Fund expenses through August 31, 2024. According to the Fund’s current prospectus, the Fund’s expense ratio of 0.41% (0.40% after fee waiver) includes the unitary management fee of 0.39% and acquired fund fees and expenses of 0.02%. 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 stated above 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 the indexes are based on the inception date of the Fund.

The Invesco Total Return Bond ETF (the “Fund”) is an actively managed exchange-traded fund (“ETF”) whose investment objective is to seek maximum total return, comprised of income and capital appreciation. The Fund will normally invest in a portfolio of fixed income instruments of varying maturities and of any credit quality. The Fund will normally invest at least 80% of its net assets (plus any borrowings for investment purposes) in fixed income instruments, which may be represented by certain derivative instruments as discussed below, and also include exchange-traded funds (“ETFs”) and closed-end funds (“CEFs”) that invest substantially all of their assets in fixed income instruments (which may include ETFs and CEFs affiliated with the Fund). The fixed income instruments in which the Fund will invest include corporate debt securities of U.S. and non-U.S. issuers, including corporate bonds, and other similar instruments, such as Treasury securities, collateralized loan obligations, mortgage- backed securities and asset-backed securities, issued by various U.S. and non-U.S. public- or private-sector entities, and municipal securities, which are debt securities issued by states or local governments and their agencies, authorities and other government sponsored enterprises.

For the fiscal year ended October 31, 2022, on a market price basis, the Fund returned (18.81)%. On a net asset value (“NAV”) basis, the Fund returned (18.65)%. During this same time period, the Bloomberg U.S. Aggregate Bond Index (the “Benchmark Index”) returned (15.68)%. The Benchmark Index is an unmanaged index weighted by market capitalization based on the average performance of approximately 11,570 securities. The Benchmark Index was selected for its recognition in the marketplace, and its performance comparison is a useful measure for investors as a broad representation of the U.S. bond market.

The Fund’s underperformance, on a NAV basis, relative to the Benchmark Index during the period was primarily due to the Fund’s security selection in the health care sector. Security selection within the consumer staples sector also detracted from the Fund’s performance relative to the Benchmark Index during the period.

For the fiscal year ended October 31, 2022, from an industry perspective, exposure to tobacco was the largest contributor to the Fund’s absolute return, followed by paper & forest products. In contrast, exposure to the banking and capital markets industries detracted from the Fund’s performance.

Positions that contributed most significantly to the Fund’s return included Enerflex Ltd., 9.00% coupon; due 10/15/2027 (portfolio average weight of 0.10%) and Uniform Mortgage-Backed Securities, 5.00% coupon; due 11/14/2022 (portfolio average weight of 3.00%). Positions that detracted most significantly from the Fund’s return included a U.S. Treasury Bond, 2.88% coupon; due 05/15/2052 (portfolio average

weight of 0.30%) and JAB Holdings B.V., 4.50% coupon; due 04/08/2052 (portfolio average weight of 0.50%).

 

Asset Group (% of the Fund’s Net Assets) as of October 31, 2022
U.S. Dollar Denominated Bonds & Notes			64.08
Asset-Backed Securities			25.95
U.S. Government Sponsored Agency Mortgage-Backed Securities			22.23
U.S. Treasury Securities			1.44
Agency Credit Risk Transfer Notes			0.91
Municipal Obligations			0.41
Open Over-The-Counter Foreign Currency			0.37
U.S. Government Sponsored Agency Securities			0.33
Open Exchange-Traded Index Options Purchased			0.03
Non-U.S. Dollar Denominated Bonds & Notes			0.02
Money Market Funds Plus Other Assets Less Liabilities			(15.77)
Top Ten Fund Holdings* (% of the Fund’s Net Assets) as of October 31, 2022
Security
Uniform Mortgage-Backed Securities, TBA, 5.50%, 11/01/2052			4.01
Uniform Mortgage-Backed Securities, TBA, 5.00%, 11/01/2052			3.00
Uniform Mortgage-Backed Securities, TBA, 6.00%, 11/01/2052			2.99
Uniform Mortgage-Backed Securities, TBA, 2.00%, 11/01/2052			2.76
Uniform Mortgage-Backed Securities, TBA, 2.50%, 11/01/2052			1.93
BX Trust, Series 2021-LGCY, Class B, 4.27%, 10/15/2023			1.27
Uniform Mortgage-Backed Securities, TBA, 4.50%, 11/01/2052			1.18
Uniform Mortgage-Backed Securities, TBA, 4.00%, 11/01/2052			1.14
BX Commercial Mortgage Trust, Series 2021-VOLT, Class D, 5.06%, 09/15/2036			1.11
Algonquin Power & Utilities Corp., 4.75%, 01/18/2082			1.08
Total			20.47

 

*	Excluding money market fund holdings.

Guggenheim Total Return Bond ETF (the “Predecessor Fund”) Inception: February 10, 2016

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 0.50% 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 index stated above 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 index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.

Notes Regarding Index and Fund Performance History:

 

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

 

-	Effective after the close of business on April 6, 2018, the Predecessor Fund was reorganized into the Fund. Fund returns shown are blended returns of the Predecessor Fund and the Fund.

The Invesco Ultra Short Duration ETF (the “Fund”) is an actively managed exchange-traded fund (“ETF”) whose investment objective is to seek maximum current income, consistent with preservation of capital and daily liquidity. The Fund will invest at least 80% of its net assets (plus any borrowings for investment purposes) in fixed income securities and in exchange-traded funds (“ETFs”) and closed-end funds that invest substantially all of their assets in fixed income securities. The Fund uses a low duration strategy to seek to outperform the ICE BofA US Treasury Bill Index (the “Benchmark Index”) in addition to providing returns in excess of those available in U.S. Treasury bills, government repurchase agreements, and money market funds, while seeking to provide preservation of capital and daily liquidity. The Fund expects, under normal circumstances, to hold a diversified portfolio of fixed income instruments of varying maturities, but that have an average duration of less than one year.

The Fund is primarily invested in corporate bonds, commercial paper and asset-backed securities. The Fund’s high allocation to floating rate securities reduces interest rate risk while commercial paper helps the Fund manage its liquidity needs. The Fund’s focus on high-quality short maturity holdings helps the Fund manage credit risk. The Fund continues to maintain an average effective duration below one year. The portfolio management team believes the Fund is well positioned for interest rate volatility and broader financial market sell-offs overall and relative to other conservative ultra-short fixed income funds. The Fund’s significant holdings in high quality investment grade assets and money market securities continue to help reduce drawdown risks, while preserving capital and maintaining a competitive yield.

For the fiscal year ended October 31, 2022, on a market price basis, the Fund returned (1.15)%. On a net asset value (“NAV”) basis, the Fund returned (1.13)%. During the same time period, the Benchmark Index returned 0.62%. The Fund’s underperformance, on a NAV basis, relative to the return of the Benchmark Index during the year was primarily due to the Fund maintaining an overweight position in long maturity investment grade credit securities.

Allocation to and security selection within investment grade corporate bonds of communication services companies and cash securities were positive contributors to the Fund’s performance relative to the Benchmark Index. Additionally, the Fund’s performance was positively impacted by its overweight allocation to the gas utilities, diversified telecommunication services, and hotels, restaurants & leisure industries. The allocation to the banks industry was a detractor from the Fund’s performance relative to the Benchmark Index.

Positions that contributed most significantly to the Fund’s return included Cerberus Loan Funding XXXIV L.P. (portfolio average weight of 0.27%) and a Macquarie Group Ltd. (portfolio average weight of 0.95%). Positions that detracted most significantly from

the Fund’s return included COLT Mortgage Loan Trust (portfolio average weight of 0.49% ) and Verus Securitization Trust (portfolio average weight of 0.40%).

Security Type Breakdown (% of the Fund’s Net Assets) as of October 31, 2022
U.S. Dollar Denominated Bonds & Notes			42.21
Commercial Paper			37.38
Asset-Backed Securities			13.27
Repurchase Agreements			3.79
Non-U.S. Dollar Denominated Bonds & Notes			2.81
U.S. Treasury Securities			1.82
Certificates of Deposit			0.13
Variable Rate Senior Loan Interests			0.07
Money Market Funds Plus Other Assets Less Liabilities			(1.48)
Top Ten Fund Holdings* (% of the Fund’s Net Assets) as of October 31, 2022
Security
Japan Treasury Discount Bill, Series 1111, 0.00%, 01/11/2023			2.81
Citigroup Global Markets, Inc., joint term agreement dated 10/19/2022, 3.71%, 11/01/2022			2.37
Barclays Capital, Inc., 1.06%, 02/02/2023			1.73
Alimentation Couche-Tard, Inc., 3.88%, 11/14/2022			1.52
J.P. Morgan Securities LLC, joint open agreement dated 06/11/2021, 3.37%, 11/01/2022			1.42
Brookfield Infrastructure Holdings Canada, Inc., 4.32%, 12/01/2022			1.18
Discover Bank, 3.35%, 02/06/2023			1.18
Bank of Nova Scotia (The), 1.95%, 02/01/2023			1.18
National Bank of Canada, 2.10%, 02/01/2023			1.18
HSBC USA, Inc., 0.78%, 01/06/2023			1.18
Total			15.75

 

*	Excluding money market fund holdings.

Guggenheim Ultra Short Duration ETF (the “Predecessor Fund”) Inception: February 12, 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 total annual operating expense ratio was indicated as 0.22%. The Financial Highlights section of the Shareholder Report presents the expense ratios based on expenses incurred during the period covered by this report. 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 index stated above 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 index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.

Notes Regarding Index and Fund Performance History:

 

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

 

-	Effective after the close of business on April 6, 2018, the Predecessor Fund was reorganized into the Fund. Fund returns shown are blended returns of the Predecessor Fund and the Fund.

The Invesco Variable Rate Investment Grade ETF (the “Fund”) is an actively managed exchange-traded fund (“ETF”) whose investment objectives are seeking to generate current income while maintaining low portfolio duration as a primary objective and capital appreciation as a secondary objective. The Fund seeks to achieve its investment objectives by investing, under normal market conditions, at least 80% of its net assets (plus any borrowings for investment purposes) in a portfolio of investment grade, variable rate or floating rate debt securities that are denominated in U.S. dollars and are issued by U.S. private sector entities or U.S. government agencies and instrumentalities.

Invesco Advisers, Inc., the sub-adviser to the Fund, selects the following types of securities for the Fund: (i) floating rate non-agency commercial mortgage-backed securities (“MBS”); variable rate non-agency residential MBS; variable rate agency MBS and floating rate non-agency asset-backed securities (“ABS”) (including floating rate non-agency commercial real estate collateralized loan obligations); (ii) floating rate corporate debt securities (comprised of corporate notes, bonds, debentures or privately issued securities offered pursuant to Rule 144A of the Securities Act of 1933, as amended); (iii) floating rate government sponsored enterprise credit risk transfers; (iv) floating rate U.S. Government securities (including floating rate agency debt securities); (v) variable rate preferred stock; and (vi) affiliated ETFs that invest primarily in any or all of the foregoing securities (collectively, “Variable Rate Instruments”), to the extent permitted by the Investment Company Act of 1940, as amended.

During the fiscal year ended October 31, 2022, on a market price basis, the Fund returned (0.53)%. On a net asset value (“NAV”) basis, the Fund returned (0.45)%. During the same time period, the Bloomberg US Floating Rate Note Index (the “Benchmark Index”) returned 0.29%.

The Fund’s underperformance relative to the Benchmark Index was driven largely by its security selection within the communication services sector, as well as security selection within the energy sector. The Fund’s allocation to the financials sector was also a negative contributor for the period. The Fund’s allocation to the utilities sector and the health care sector contributed to the Fund’s relative performance for the period.

Positions that contributed most significantly to the Fund’s return included BOC Aviation Ltd., 4.77% coupon, due 09/26/2023 (portfolio average weight of 0.50%) and QUALCOMM, Inc., 5.15% coupon, due 01/30/2023 (portfolio average weight of 0.90%). Positions that detracted most significantly from the Fund’s return were Freddie Mac Multifamily Structured Credit Risk, Series 2021-MN2, Class M1, 4.80% coupon, due 07/25/2041 (portfolio average weight of 0.60%) and Mello Mortgage Capital Acceptance Trust, Series 2021-INV2, Class A1, 3.23% coupon, due 08/25/2051 (portfolio average weight of 0.50%).

Security Type Breakdown (% of the Fund’s Net Assets) as of October 31, 2022
U.S. Dollar Denominated Bonds & Notes			48.05
Agency Credit Risk Transfer Notes			16.71
Asset-Backed Securities			16.62
U.S. Treasury Securities			15.12
U.S. Government Sponsored Agency Mortgage-Backed Securities			3.03
Money Market Funds Plus Other Assets Less Liabilities			0.47
Top Ten Fund Holdings* (% of the Fund’s Net Assets) as of October 31, 2022
Security
U.S. Treasury Floating Rate Notes, 4.04%, 04/30/2024			12.02
U.S. Treasury Floating Rate Notes, 4.15%, 07/31/2024			3.10
American Express Co., 3.69%, 02/27/2023			0.91
Freddie Mac, Series 2021-DNA6, Class M2, STACR®, 4.50%, 10/25/2041			0.90
QUALCOMM, Inc., 5.15%, 01/30/2023			0.87
ING Groep N.V., 4.74%, 10/02/2023			0.87
Athene Global Funding, 3.49%, 05/24/2024			0.86
STAR Trust, Series 2022-SFR3, Class B, 5.37%, 05/17/2024			0.85
NextEra Energy Capital Holdings, Inc., 4.04%, 03/21/2024			0.84
Freddie Mac, Series 2021-DNA2, Class M2, STACR®, 5.30%, 08/25/2033			0.80
Total			22.02

 

*	Excluding money market fund holdings.

Fund Inception: September 22, 2016

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 0.30% 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 Benchmark Indexes stated above 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 Benchmark Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the hypothetical performance shown. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in the Fund.

Notes Regarding Index and Fund Performance History:

 

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

		Shares				Value
Common Stocks & Other Equity Interests-100.04%
Apartments-10.42%
Apartment Income REIT Corp.			33,322			$	1,280,565
AvalonBay Communities, Inc.			7,059				1,236,172
Camden Property Trust			10,844				1,253,024
Equity Residential			19,409				1,223,155
Essex Property Trust, Inc.			5,414				1,203,207
Independence Realty Trust, Inc.			78,710				1,319,180
Mid-America Apartment Communities, Inc.			8,469				1,333,444
UDR, Inc.			31,791				1,264,010
Veris Residential, Inc.(b)			103,355				1,636,110
							11,748,867
Data Centers-7.91%
Digital Realty Trust, Inc.			44,614				4,472,553
Equinix, Inc.			7,858				4,451,086
							8,923,639
Diversified-3.38%
Elme Communities(c)			71,858				1,371,769
JBG SMITH Properties			43,119				848,582
Vornado Realty Trust			31,555				744,383
W.P. Carey, Inc.(c)			11,120				848,456
							3,813,190
Free Standing-5.43%
Agree Realty Corp.			12,427				853,735
Essential Properties Realty Trust, Inc.			41,443				891,853
Four Corners Property Trust, Inc.			34,258				877,690
National Retail Properties, Inc.			20,859				876,704
NETSTREIT Corp.(c)			45,487				856,065
Realty Income Corp.			14,232				886,227
Spirit Realty Capital, Inc.			22,743				883,111
							6,125,385
Health Care-7.12%
CareTrust REIT, Inc.			64,398				1,202,955
Healthcare Realty Trust, Inc.			55,653				1,131,425
Healthpeak Properties, Inc.			47,571				1,128,860
National Health Investors, Inc.			20,404				1,156,907
Physicians Realty Trust(c)			76,770				1,156,156
Ventas, Inc.			29,037				1,136,218
Welltower, Inc.			18,296				1,116,788
							8,029,309
Industrial-10.84%
Americold Realty Trust, Inc.(c)			69,939				1,696,021
EastGroup Properties, Inc.			11,260				1,764,329
First Industrial Realty Trust, Inc.			36,485				1,737,781
Prologis, Inc.			15,960				1,767,570
Rexford Industrial Realty, Inc.			31,220				1,725,842
STAG Industrial, Inc.			57,273				1,809,254
Terreno Realty Corp.			30,253				1,728,656
							12,229,453
Infrastructure REITs-18.67%
American Tower Corp.			34,797				7,209,590
Crown Castle, Inc.			50,347				6,709,241
SBA Communications Corp., Class A			26,432				7,133,997
							21,052,828