The Invesco Variable Rate Preferred ETF (the Fund) aims to mirror the performance of the ICE Variable Rate Preferred & Hybrid Securities Index. At least 90% of the Fund's assets are strategically allocated to U.S. dollar-denominated, floating and variable rate preferred stocks, as well as specific hybrid debt instruments. These securities, issued by U.S. corporations, encompass both investment-grade and below-investment-grade credit quality. The Index itself is designed to track similar U.S. dollar preferred stocks and hybrid securities, as deemed comparable by the Index Provider, issued in the U.S. market. Instead of replicating the entire Index, the Fund employs a "sampling" approach to fulfill its investment objective. Both the Fund and the underlying Index undergo monthly rebalancing. As of August 31, 2025, Morningstar Inc. awarded the Fund an exceptional 5-star overall rating (among 66 funds), a distinction it also held for its 3-year (out of 66 funds), 5-year (out of 58 funds), and 10-year (out of 38 funds) performance periods. These ratings are determined by a risk-adjusted return methodology, which prioritizes consistent performance and places greater emphasis on mitigating downside volatility. For comparative purposes, open-end mutual funds and exchange-traded funds are grouped together, with a minimum three-year operational history required for rating eligibility. The overall rating is a weighted average of the applicable three-, five-, and ten-year metrics, factoring in fees and expenses but excluding sales charges. Morningstar's system allocates 5 stars to the top 10% of funds in a category, 4 stars to the next 22.5%, 3 stars to the subsequent 35%, 2 stars to the following 22.5%, and 1 star to the bottom 10%. Ratings are subject to monthly adjustments. It is important to note that if historical fee waivers or expense reimbursements had not occurred, the Morningstar rating might have been lower, and ratings for other share classes could differ due to distinct performance characteristics. Morningstar's content is proprietary and strictly prohibited from being copied or distributed; its accuracy, completeness, or timeliness is not guaranteed, nor is Morningstar liable for any damages arising from its use. Investors should be aware that past performance is not a guarantee of future outcomes.
