Invesco Perpetual US Enhanced Index Fund
May 2017 (Content as at 30 April 2017)
You can currently only invest in this fund via a qualified financial adviser or a third party fund platform.
The companies we look for
In today’s world of low-returns, every little extra, in performance terms, helps.
The Invesco Perpetual US Enhanced Index Fund seeks to capture both the return of the S&P 500 index, and achieve an additional return, while maintaining a similar level of risk over a full market cycle (5 - 10 years).
The fund managers look to identify the factors that have the potential to drive excess returns, and thereby generate meaningful outperformance.
Typical number of stocks in the fund: c250
The stocks held in the fund will primarily be those of the S&P 500 index, which comprises 500 of the largest companies which trade on the New York Stock Exchange, although there is flexibility for a proportion of the stocks held in the fund to be from outside of this index.
The Invesco Perpetual US Enhanced Index Fund aims to achieve long term capital growth and outperform the S&P500 Index (net total return) (the “Index”) by investing primarily in a portfolio of investments in US companies. The fund aims to outperform the Index net of fees over a full market cycle (typically 5-10 years). There is no guarantee that the fund will achieve its target and an investor may not get back the full amount invested. The fund seeks to achieve its objective following a systematic investment process, with a high correlation to the Index. The fund uses a range of factors to evaluate the relative attractiveness of a stock together with an assessment of risk, to build a portfolio that shares the broad characteristics of the Index. The fund is actively managed and will not replicate the Index in its entirety. The fund will primarily invest in equities, and may also invest in cash, cash equivalents, money market instruments, warrants, collective investment schemes and other transferable securities. The fund may enter into financial derivative instruments for efficient portfolio management purposes only.
US equity markets kicked off April on a more volatile note primarily attributed to the release of the Federal Reserve’s (Fed) March meeting minutes that revealed its intention to start reducing its sizable US$4.5 trillion balance sheet later this year. Due to its size, unwinding the balance sheet would not only impact markets, but essentially amount to a Fed interest rate hike. Despite a moderation in growth year-to-date and mixed economic data released in April, the move supports the Fed’s longer term assertion for growth and rising inflation. Meanwhile, although markets remain sceptical about the US administration’s ability to successfully push through its policy agenda, President Donald Trump’s tax reform plans announced in April were welcomed by investors. Coupled with initial encouraging corporate earnings releases for the first quarter of 2017, US equities extended their run of consecutive positive monthly performances.
The performance of the fund is generated through a systematic factor based investment process driven by four concepts: Earnings Expectations, Market Sentiment, Management & Quality and Value. Relative risk is controlled with the help of an optimiser, an analysis tool that recommends trades to maximise portfolio exposure to the selected stocks within pre-determined risk/return parameters. In terms of portfolio construction, we tightly constrain the risk taken at sector and industry level. Our diversified approach to stock selection favours companies that, in our view, are attractively valued and have good earnings and price momentum and evidence that management supports shareholder value.
|Launch date||28 July 2016|
|Available in an ISA?||Yes|
|Title:||Global Head of Research|
|Team:||Invesco Quantitative Strategies|
|Team:||Invesco Quantitative Strategies|
|Accounting period ends||
|Accumulation (No Trail)||BZ8GX05||GB00BZ8GX054|
|Income (No Trail)||BZ8GX16||GB00BZ8GX161|
|Minimum monthly amount||£20|
|Minimum additional lump sum||£100|
One-off charges taken before you invest
The entry charge for the fund is up to 5%. This is the maximum that might be taken out of your money before it is invested. For example, if you invest £1,000, an entry charge of 5% means £950 of your money will be used to buy shares in the fund.
The entry charge covers the costs of setting up your investment.
If you invest through a third party (such as a financial adviser), but do not receive financial advice on your investment, this charge may include payments to that third party. For more details see "What share classes are available for your ICVC funds?".
There is no exit charge for the fund.
Charges taken from the fund over a year
The ongoing charge figure is based on a fixed, all-inclusive fee and excludes portfolio transaction costs. The ongoing charge for each share class can be found in the relevant Key Investor Information Document available under 'Literature'. Investors will be provided with advance notice if any increases to this figure occur.
The ongoing charge covers all aspects of operating the fund during the year, including fees paid for investment management, administration and the independent oversight functions.
If you invest through a third party (such as a financial adviser), but do not receive financial advice on your investment, this charge may include payments to that third party. Once invested, your contract note or acknowledgement letter will show the amount of any payment in cash terms. For more details see "What share classes are available for your ICVC funds?".
Charges taken from the fund under specific conditions
No performance fee is charged.
Portfolio transaction costs1
On average, since the launch of the fund on 28 July 2016, the fund incurred broker commissions of 0.03% and transfer taxes of 0.00%, as a necessary part of buying and selling the fund's underlying investments in order to achieve the investment objective. A proportion of these costs is recovered directly from investors joining and leaving the fund.
When the fund buys or sells shares, broker commissions and transfer taxes are paid by the fund on each transaction. In addition, there is a dealing spread between the buying and selling prices of the underlying investments. Unlike shares, other types of investments (such as bonds, money market instruments and derivatives) have no separately identifiable transaction costs; these costs form part of the dealing spread. Dealing spreads vary considerably depending on the transaction value and market sentiment. The estimated average dealing spread for the fund is 0.03% of the transaction value.
Comparing portfolio transaction costs for a range of funds may give a false impression of the relative costs of investing in them, for the following reasons:
- Transaction costs do not necessarily reduce returns. The net impact of dealing is the combination of the effectiveness of the manager's investment decisions in improving returns and the associate costs of investment
- Historic transaction costs are not an effective indicator of the future impact on performance
- Transaction costs for buying and selling investments due to other investors joining or leaving the fund may be recovered from those investors. For further information see Pricing policy note below
- Transaction costs vary from country to country
- Transaction costs vary depending on the types of investment in which a fund invests
- As the manager's investment decisions are not predictable, transaction costs are also not predictable
Pricing policy note1
We operate a single pricing methodology for this fund and reserve the right to adjust the fund's price to protect your investment from the costs of buying and selling investments that result from other investors joining or leaving the fund. The amount of any such adjustment is calculated by reference to the estimated costs of dealing in the underlying investments, including any dealing spreads, broker commissions and transfer taxes.
Typical adjustments to the fund's price are to increase it by 0.20% for net inflows or decrease it by 0.20% for net outflows.
We usually adjust the price to the maximum extent possible when the value of net contributions or withdrawals is significant, which helps to protect your investment from the costs of the resultant transactions.
1The fund's financial year end is 31 August 2016. Figures in these sections are as at 31 August 2016.
Product & fund information
The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested. Past performance is not a guide to future returns.
The fund may use derivatives (complex instruments) in an attempt to reduce the overall risk of its investments, reduce the costs of investing and/or generate additional capital or income, although this may not be achieved. The use of such complex instruments may result in greater fluctuations of the value of the fund. The Manager, however, will ensure that the use of derivatives within the fund does not materially alter the overall risk profile of the fund.
Yield and performance figures are based on the z (accumulation) share class.
All fund portfolio figures are as at date shown (source: Invesco Perpetual).
Where there is insufficient historical data available to calculate the historic yield we have shown an estimated yield, using the most appropriate basis of calculation. It does not include any entry charge and investors may be subject to tax on their distributions.
Where Invesco Perpetual has expressed views and opinions, these may change. Where securities are mentioned they do not necessarily represent a specific portfolio holding and do not constitute a recommendation to purchase, hold or sell.
For the most up to date information on our funds, please refer to the relevant fund and share class-specific Key Investor Information Documents, the Supplementary Information Document, the Annual or Interim Short Reports and the Prospectus, which are available using the contact details shown.