Invesco Euro Short Term Bond Fund A-Acc shares

Transcription

1 Invesco Euro Short Term Bond Fund A-Acc shares June 2018 This marketing document is exclusively for use by Professional Clients and Financial Advisers in Continental Europe (as defined in the important information) and Ireland, Qualified Investors in Switzerland and Professional Clients in Cyprus, Isle of Man and the UK. This document may also be used by financial intermediaries in the United States as defined in the important information. This document is not for consumer use, please do not redistribute. EMEA4514/2018

2 Contents Invesco Euro Short Term Bond Fund Investment philosophy and process Portfolio performance and positioning Quarterly Risk-Return Analysis 2

3 Invesco Euro Short Term Bond Fund

4 Why consider the Invesco Euro Short Term Bond Fund? Key fund features High quality core The fund managers predominantly invest in euro-denominated investment grade bonds with a maximum maturity of 5 years. They maintain a short duration profile, typically between 1 and 3 years. with the flexibility to seek value Mitigating the impact of a rising interest rate environment The fund managers can target opportunities in global bond markets. They can tactically invest in high yield and longer dated bonds, and they may selectively take active currency positions. The current low yield environment offers little return for higher levels of duration risk (the risk that the value of the fund is negatively impacted by a rise in interest rates). We actively manage short term corporate bonds seeking to deliver income whilst reducing the fund s interest rate sensitivity compared to the market 4 Investment expertise The Invesco Fixed Income team has been actively investing in fixed income markets for more than 30 years and currently manages approximately US$296bn 1 of assets on behalf of institutional and private investors globally across a wide range of strategies. We have the ability to leverage off the experience of our global team of over 160 investment professionals 1 Source: Invesco as at 30 April Although every effort will be made, it cannot be guaranteed, that these targets will be achieved. 4

5 Luke Greenwood & Lyndon Man Fund managers Luke Greenwood Lyndon Man In my view, the current interest rate environment lends itself to actively managed, less interest rate sensitive funds, and our job is to try and protect capital whilst maximising the return. Luke Greenwood, Fund Manager 5

6 Invesco Euro Short Term Bond Fund Fund facts Fund name Fund objectives Invesco Euro Short Term Bond Fund The objective of the Fund is to provide capital growth by investing primarily in short-term investment grade debt securities (including money market instruments) denominated in Euro 1 Launch date 4 May 2011 Domicile Legal structure Base currency Unit type Reference index Luxembourg Luxembourg SICAV with UCITS status EUR Accumulation Bloomberg Barclays Euro Aggregate 1 3 year index Share class Unit type Share class ccy Annual management fee Minimum investment ISIN code A Acc EUR 0.70% EUR 1,000 LU There may be additional share classes 2 registered for sale in individual jurisdictions. 1 For the full objectives and investment policy please consult the current prospectus. 2 For information on fund and fund s shares registrations, please refer to the appropriate internet site or your local Invesco office. Not all share classes are the same nor do they necessarily suit every investor. There may be differences in fee structures, in minimum investment amounts, etc. Please check the fund prospectus for additional information. 6

7 Investment philosophy and process

8 Our global perspective and local market knowledge help us uncover investment opportunities We have a well-resourced investment team with a strong global perspective London Portland Chicago Toronto London Louisville New York Atlanta San Diego Palm Harbor Tokyo Shenzhen Mumbai Hong Kong Kong Scope of fixed income platform: US$314.4 billion AUM Depth of resources: 169 investment professionals 226 professionals Global footprint: 10 locations in key markets Rates 19 Currency 14 Credit 72 PM 77 Shenzhen and Mumbai represent wholly owned Invesco subsidiaries and are not included in the official IFI location count. Source: Invesco, as of March 31, Subject to change without notice. 8

9 We believe return opportunities arise from both market direction and fundamentally-based security selection Our philosophy ties opportunity to the economic cycle An economy s cycle of expansions and contractions matters for asset prices Successful long-term management requires skill in determining market direction and effective security selection Market Direction Themes Security Selection Integrating local knowledge into a global view strengthens our capabilities Multi-faceted risk management is critical for exceptional long term performance Economic Cycle We believe at different points in a market cycle, market direction and security selection differ in importance For illustrative purposes only. Source: Invesco, as of April

10 Our disciplined process builds on our investment philosophy as we seek to drive strong results Macro Research Our investment process builds on key components Integrated Strategy Fundamentally based macro and credit research generate investable views, themes and input for strategy Credit Research Integrated strategy determines views on market direction, risk positioning, and asset allocation Platform Tool Kit Portfolio Management Portfolio managers utilize platform views (the tool kit) for client portfolios Risk management is integrated throughout our process Client Portfolio For illustrative purposes only. 10

11 Invesco Euro Short Term Bond Fund Opportunistic and flexible investment process drives performance High quality core Flexibility to seek value Strong track record Predominantly euro denominated investment grade bonds with a maximum maturity of 5 years Maintains a short duration profile, typically between 1 3 years Ability to target opportunities in global bond markets Capacity to tactically invest in high yield and longer dated bonds Selectively takes active currency positions First quartile over 5 years 1 High risk-adjusted returns 2 Lipper Fund Awards 3 Source: Invesco, as of 30 April Since Inception: 4 May year period. 3 Lipper Fund Awards 2015 (which are awarded on an annual basis) Recognised for 3 year performance. Further information is available on Past performance is no guarantee of future returns. Any references to awards and ratings provide no guarantee of future returns. For illustrative purposes only. Please see quartile peer group rankings on slide 15. Any reference to a ranking, a rating or an award provides no guarantee for future performance results and is not constant over time. 11

12 Invesco Euro Short Term Bond Fund Fund characteristics Core Euro denominated investment grade bonds with a maximum maturity of 5 years (minimum 70%) Non-euro bonds Maximum of 30% Duration management High yield bonds Typically between 1 3 years We do not currently see exposure exceeding 8% Objective Targeted risk adjusted returns Currency Non-euro exposure typically less than 5% Derivatives Used for efficient portfolio management & investment purposes Whilst the Prospectus allows for more flexibility, historically the fund has not exceeded the allocations shown which allows the fund to be included in the Morningstar GIF OS EUR Diversified Bond Short Term sector. For illustrative purposes only. For the full objectives and investment policy please consult the current prospectus. 12

13 Portfolio performance and positioning

14 Invesco Euro Short Term Bond Fund Indexed performance Indexed performance /13 11/13 05/14 11/14 05/15 11/15 05/16 11/16 05/17 11/17 05/18 Fund Bloomberg Barclays Euro Aggregate 1-3 Year Index The performance data shown relates to a past period. Past performance is not a guide to future returns. 1 (Source: 2017 Morningstar as at 31 May 2018) Fund returns are inclusive of gross income re-invested and net of the ongoing charge and portfolio transaction costs, cumulative, in fund currency. The figures do not reflect the entry charge payable by individual investors. The performance data shown does not take account of the commissions and costs incurred on the issue and redemption of units. 14

15 Invesco Euro Short Term Bond Fund Net cumulative and calendar year performance Cumulative performance 1 in % YTD 1 month 1 year 3 years 5 years Fund Index Quartile ranking Absolute ranking 39/62 34/63 29/60 17/54 9/49 Mstar GIF OS Sector: EUR Diversified Bond - Short Term Calendar year performance 1 in % Fund Index LU Rolling 12 month performance to end of 1 in % May 2014 May 2015 May 2016 May 2017 May 2018 Fund Index The performance data shown relates to a past period. Past performance is not a guide to future returns. 1 (Source: 2017 Morningstar as at 31 May 2018) Fund returns are inclusive of gross income re-invested and net of the ongoing charge and portfolio transaction costs, cumulative, in fund currency. The figures do not reflect the entry charge payable by individual investors. The performance data shown does not take account of the commissions and costs incurred on the issue and redemption of units. Share class: A-Acc. Share class currency: EUR. 2 Bloomberg Barclays Euro Aggregate 1 3 Year Index. 15

16 Invesco Euro Short Term Bond Fund Geographical weightings Geographical weightings 1 in % Fund Italy 18.4 Germany 14.1 France 12.0 Spain 11.4 United Kingdom 9.0 United States 7.0 Netherlands 3.6 Switzerland 2.6 China 2.5 Others 13.5 Currency Forwards -0.4 Cash & Cash Equivalents 6.3 Geographical weightings of the fund in % 1 Italy Germany France Spain United Kingdom United States Netherlands Switzerland China Others Currency Forwards Cash & Cash Equivalents 1 Source: Invesco as at 31 May Portfolio weightings can change any time and without warning. 16

17 Invesco Euro Short Term Bond Fund Sector weightings Sector weightings 1 in % Fund Government Bonds 47.6 Government Related 3.5 Corporate Bonds 42.8 Financial 22.7 Industrial 18.0 Utility 2.1 Collective Investment Scheme 0.2 Currency Forwards -0.4 Cash & Cash Equivalents Source: Invesco as at 31 May Portfolio weightings and allocations are subject to change. 17

18 Invesco Euro Short Term Bond Fund Credit ratings Credit ratings 1 Average rating: A- In % AAA 11.3 AA 10.7 A 13.9 BBB 53.5 BB 4.5 Not rated 0.2 Currency Forwards -0.4 Cash & Cash Equivalents 6.3 Credit ratings of the fund in % 1 AAA AA A BBB BB Not rated Currency Forwards Cash & Cash Equivalents A Acc shares. 1 Source: Invesco as at 31 May Portfolio weightings and allocations are subject to change. 18

19 Invesco Euro Short Term Bond Fund Currency exposure Currency exposure 1 in % Fund EUR GBP -0.1 USD -0.3 A Acc shares. 1 Source: Invesco as at 31 May Portfolio weightings and allocations are subject to change. 19

20 Invesco Euro Short Term Bond Fund Yield % 1 Gross Current Yield 2.1 Gross Redemption Yield Source: Invesco as at 31 May Portfolio weightings and allocations are subject to change. Dollar = US$. There is currently a discretionary cap of operating expenses at a maximum of 0.05% in place. This figure forms part of the ongoing charge and may positively impact the performance of the Share Class. 20

21 Quarterly Risk-Return Analysis

22 Key Messages Blend of high-quality short dated bonds with tactical investments in the broader bond markets Outperformed the peer group average by 5.43% on a cumulative basis since launch in 2011 High conviction themes resulted in higher gross redemption yield vs. the benchmark and very competitive risk-adjusted ratios Source: Invesco, Morningstar, as of March 31st, 2018; monthly total returns in EUR. Peer group (5 95%): EUR Diversified Bond Short Term. The performance data shown relates to a past period. Past performance is not a guide to future returns. Any reference to a ranking provides no guarantee for future performance results and is not constant over time. 22

23 Invesco Euro Short Term Bond Fund Investment strategy* ISIN Primarily invests in short term (<5yrs) Investment Grade corporate and government bonds. Selective participation (<8%) in rising stars as a diversifier to the portfolio LU (A, Acc, EUR) Reference index Bloomberg Barclays EuroAgg 1-3 Years TR EUR (BBgBarc Euro Agg 1-3 Yr TR EUR) Morningstar Sector Currency Fund/Strategy AuM PMs and tenure Industry experience GIF OS EUR Diversified Bond Short Term Euro EUR 666.9mn/ EUR 1.4bn Luke Greenwood (lead) and Lyndon Man have actively managed the fund since launch (officially since August 2013). Luke Greenwood: 24 years Lyndon Man: 17 years Launch Date** May 4 th, 2011 Indexed Performance: Invesco Euro Short Term Bond Fund Fund Index Calendar year return Fund 2.41% 2.49% 0.37% 0.84% 0.50% Index 1.96% 1.80% 0.59% 0.59% -0.12% Sector Average 0.73% 1.31% -0.24% 0.53% -0.02% Five year rolling returns 01/04/13-31/03/14 01/04/14-31/03/15 01/04/15-31/03/16 01/04/16-31/03/17 01/04/17-31/03/18 Fund 3.14% 2.46% -0.60% 0.87% 0.09% Index 2.12% 1.53% 0.45% 0.17% 0.07% Sector avg. 1.21% 1.39% -0.70% 0.24% -0.27% Source: Invesco, Morningstar, as of March 31st, 2018; monthly total returns in EUR. The performance data shown relates to a past period. Past performance is not a guide to future returns. Performance displayed in this document is net of fees and does not reflect the entry charge payable by individual investors. *For the full objectives and investment policy please consult the current prospectus. **For the share class. 23

24 Cumulative performance in % Top performer within its peer group Investment growth since inception of Invesco Euro Short Term Bond Cumulative Return: 11.93% Outperformed the peer group average by 5.43% on a cumulative basis since inception Cumulative performance in 3 rd decile since inception Cumulative Return: 6.50% 94 05/ / / / / / /2017 Bottom quartile 2nd quartile Invesco Euro Short Term Bond A-Acc EUR 3rd quartile Top quartile GIFS EUR Diversified Bond Short Term Source: Invesco, Morningstar, as of March 31st, 2018; monthly total returns in EUR. Time period: 04/05/2011 to 31/03/2018. peer group (5 95%): EUR Diversified Bond Short Term. The performance data shown relates to a past period. Past performance is not a guide to future returns. Any reference to a ranking provides no guarantee for future performance results and is not constant over time. Performance displayed in this document is net of fees and does not reflect the entry charge payable by individual investors. 24

25 Return in % Attractive calendar year returns Calendar year returns Positive calendar year returns in all full calendar years Outperformed the benchmark in 5 of 7 years Outperformed the peer group average in all full calendar years since launch Invesco Euro Short Term Bond A-Acc EUR GIFS EUR Diversified Bond Short Term BBgBarc Euro Agg 1-3 Yr TR EUR Source: Invesco, Morningstar, as of March 31st, 2018; monthly total returns in EUR. Peer group: EUR Diversified Bond. The performance data shown relates to a past period. Past performance is not a guide to future returns. Any reference to a ranking provides no guarantee for future performance results and is not constant over time. Performance displayed in this document is net of fees and does not reflect the entry charge payable by individual investors. 25

26 Cumulative performance in % Strong recovery after weak start Performance dip at launch of Invesco Euro Short Term Bond A-Acc EUR 106 Recovery date: Peak date: Valley date: / / / / / / /2012 Invesco Euro Short Term Bond A-Acc EUR Fund Size GIFS EUR Diversified Bond - Short Term 25mn 20mn 15mn 10mn 5mn 0mn Fund size in Euros Dip in performance immediately after launch: Strategy was overweight credit at launch relative to the benchmark However, small fund size (approx. EUR 10mn) and minimum order sizes resulted in less diversification Therefore, could not efficiently cope with euro sovereign crisis induced volatility Outperformed the peer group average and benchmark since the valley date: 30 th of November 2011 Source: Invesco, Morningstar as of March 31st, 2018; Time Period: 05/05/2011 to 31/12/2012, daily total returns in EUR. The performance data shown relates to a past period. Past performance is not a guide to future returns. Any reference to a ranking provides no guarantee for future performance results and is not constant over time. Performance displayed in this document is net of fees and does not reflect the entry charge payable by individual investors. The performance data shown relates to a past period. 26

27 Cumulative indexed performance High conviction allocation to credit and effective use of fund flexibility has led to strong outperformance 5 year investment growth Fund Cumulative Return: 6.05% Outperformed its benchmark by 1.65% and the peer group average by 4.21% on a cumulative basis over 5 years / / / / / / / / /2017 Top quartile 3rd quartile Invesco Euro Short Term Bond Fund A-Acc EUR BBgBarc Euro Agg 1-3 Yr TR EUR Benchmark Cumulative Return: 4.40% 2nd quartile Bottom quartile GIFS EUR Diversified Bond Short Term 1 st quartile cumulative performance over 5 years Source: Invesco, Morningstar, as of March 31st, 2018; monthly total returns in EUR. Time period: 01/04/2013 to 31/03/2018. peer group (5 95%): EUR Diversified Bond Short Term. The performance data shown relates to a past period. Past performance is not a guide to future returns. Any reference to a ranking provides no guarantee for future performance results and is not constant over time. Performance displayed in this document is net of fees and does not reflect the entry charge payable by individual investors. 27

28 Invesco Euro Short Term Bond A-Acc Return in % High consistency of outperformance since inception 3 year rolling out-/underperformance vs. the benchmark since inception Outperformance Excess return: 1.2% Outperformed the benchmark in 89% of times on a 3 year rolling basis Pre valley period BBgBarc Euro Agg 1-3 Yr TR EUR Return in % Post valley period Invesco Euro Short Term Bond A-Acc outperforms 35 times (89%) BBgBarc Euro Agg 1-3 Yr TR EUR outperforms 3 times (11%) The pre valley period includes the period from inception of the fund until the valley date on 30th November 2011 The post valley period starts on 1 st of December 2011 Underperformance Zero Excess Return Line Bullets on the zero excess return line represent equal returns between the fund and the benchmark. Bullets above/below represent an out-/underperformance of the benchmark Source: Invesco, Morningstar, as of March 31st, 2018; monthly total returns in EUR. Time period: 1/06/2011 to 31/03/2018; rolling window: 3 years 1 month shift; calculation benchmark: BBgBarc Euro Agg 1-3 Yr TR EUR; Peer Group (5 95%): GIF OS EUR Diversified Short Term. The performance data shown relates to a past period. Past performance is not a guide to future returns. Any reference to a ranking provides no guarantee for future performance results and is not constant over time. Performance displayed in this document is net of fees and does not reflect the entry charge payable by individual investors. 28

29 Excess return in % Identifying the key drivers of markets helped the fund to consistently outperform 3 year rolling excess return vs. BBgBarc Euro Agg 1-3 Yr TR EUR Outperformed its benchmark in 89% of times and the peer group average in 100% of times / / / / / / / /2017 Top quartile 2nd quartile 3rd quartile Bottom quartile Invesco Euro Short Term Bond Fund A-Acc EUR GIFS EUR Diversified Bond - Short Term on a 3 year rolling basis since launch Excess return in 1 st quartile 72% of times on a 3 year rolling basis since inception Source: Invesco, Morningstar as of March 31st, 2018; monthly total returns in EUR. Time Period: 01/06/2011 to 31/03/2018; rolling window: 3 years 1 month shift; calculation benchmark: BBgBarc Euro Agg 1-3 Yr TR EUR; Peer Group (5 95%): GIF OS EUR Diversified Short Term. The performance data shown relates to a past period. Past performance is not a guide to future returns. Any reference to a ranking provides no guarantee for future performance results and is not constant over time. Performance displayed in this document is net of fees and does not reflect the entry charge payable by individual investors. 29

30 Tracking error in % Tracking error in line with average despite active positioning 3 year rolling tracking error vs. BBgBarc Euro Agg 1-3 Yr TR EUR Tracking error in line with peer group average despite Active management / / / / / / / /2017 Bottom quartile 3rd quartile 2nd quartile Top quartile Invesco Euro Short Term Bond A-Acc EUR GIFS EUR Diversified Bond - Short Term Tracking error Measures the standard deviation of the excess return of the fund versus its benchmark TE = σ (Rportfolio Rbenchmark) Source: Invesco, Morningstar as of March 31 st, 2018; monthly total returns in EUR. Time Period: 01/06/2011 to 31/03/2018; rolling window: 3 years 1 month shift; calculation benchmark: BBgBarc Euro Agg 1-3 Yr TR EUR; Peer Group (5 95%): GIF OS EUR Diversified Short Term. The performance data shown relates to a past period. Past performance is not a guide to future returns. Any reference to a ranking provides no guarantee for future performance results and is not constant over time. Performance displayed in this document is net of fees and does not reflect the entry charge payable by individual investors. 30

31 Information ratio Successful implementation of investment themes is reflected by constantly superior information ratio 3 year rolling information ratio vs. BBgBarc Euro Agg 1-3 Yr TR EUR First quartile information ratio 87% of times on a 3 year rolling basis since inception / / / / / / / /2017 Bottom quartile 2nd quartile Invesco Euro Short Term Bond A-Acc EUR 3rd quartile Top quartile GIFS EUR Diversified Bond - Short Term Information Ratio Measures the ability of a manager to consistently generate excess returns on a risk-adjusted basis. IR = Excess return Tracking Error Source: Invesco, Morningstar as of March 31st, 2018; monthly total returns in EUR. Time Period: 01/06/2011 to 31/03/2018; rolling window: 3 years 1 month shift; calculation benchmark: BBgBarc Euro Agg 1-3 Yr TR EUR; Peer Group (5 95%): GIF OS EUR Diversified Short Term. The performance data shown relates to a past period. Past performance is not a guide to future returns. Any reference to a ranking provides no guarantee for future performance results and is not constant over time. Performance displayed in this document is net of fees and does not reflect the entry charge payable by individual investors. 31

32 Portfolio weight Higher gross redemption yield than benchmark with consistently high credit quality Credit quality 100% 90% 80% Portfolio held on average over 95% of investment grade credit quality bonds 70% 60% 50% 40% 30% 20% 10% 0% 10/ / / / / / /2017 AAA % AA % A % BBB % BB % B % Not Rated % Fund has a higher gross redemption yield with lower duration compared to the benchmark Gross Redemption Yield Weighted Average Duration (in years) Fund Index Europe Fund Index Gross redemption yield Average credit quality A- A+ Measures the internal rate of return earned by an investor who buys the fund today at market price and holds it until maturity gross of any tax payments. Source: Invesco, Morningstar as of March 31 st, 2018; monthly total returns in EUR. Time Period: 01/06/2011 to 31/03/2018. The performance data shown relates to a past period. Past performance is not a guide to future returns. Any reference to a ranking provides no guarantee for future performance results and is not constant over time. Performance displayed in this document is net of fees and does not reflect the entry charge payable by individual investors. 32

33 Executive Summary Blend of high-quality short dated bonds with tactical investments in the broader bond markets Outperformed the peer group average by 5.43% on a cumulative basis since launch in 2011 Consistent outperformance vs. the benchmark in 89%, and peer group in 100%, of times on a 3 year rolling basis High conviction themes resulted in competitive risk-adjusted ratios Information ratio in 1 st quartile 87% of times on a 3 year rolling basis reflected accurate identification of key market drivers Active positioning resulted in a gross redemption yield of 0.79% vs % of the benchmark Source: Invesco, Morningstar, as of March 31st, 2018; monthly total returns in EUR. Peer group (5 95%): EUR Diversified Bond Short Term. The performance data shown relates to a past period. Past performance is not a guide to future returns. Any reference to a ranking provides no guarantee for future performance results and is not constant over time. 33

34 Invesco Euro Short Term Bond Fund Investment Center Overview 34

35 Invesco Fixed Income (IFI) Key organizational strengths built around the pursuit of investment excellence Investment philosophy Organizational strength & presence: IFI is a key part of a financially strong, pure play asset manager with a singular mission Global experienced team: A global team of experienced professionals who bring together their knowledge of local markets Balanced investment process: A structured and disciplined, yet flexible process that balances top down and bottom up decision making Performance driven culture: Performance driven culture in which employees are driven to increase the predictability and consistency of investment returns 220 professionals involved including 169 investment professionals at 10 locations in key markets: Atlanta, Chicago, New York, Louisville, San Diego, Portland, Palm Harbor, Toronto, London, Hong Kong Strategies managed include: Global High Income, Emerging Markets Bond, Emerging Market Corporate Bond, Emerging Local Currencies Debt, Euro Short Term, Euro Bond, India Bond, Bank Loans, Cash Total AUM USD 312bn Source: Invesco as at 31 st March

36 Invesco Fixed Income (IFI) Platform enhancements Platform Enhancements Macro Process Credit Research Integration Expansion & formalisation of macro research process in order to complement strong security selection skills Formation of Global Credit Research team to: align credit research processes globally ensure comparable & repeatable approach Creation of Investment Strategy Team to: integrate macro & credit views provide risk positioning & asset allocation views Culture Relocation of US based members of EM, HY, Cash, & IG teams to Atlanta to: foster collaboration strengthen leadership Systems Implementation of single portfolio management and research systems globally People Considerable push to ensure Invesco Fixed Income has the right people by adding experienced resources and talent through strategic hires Source: Invesco as at 31 st March

37 Appendix Definitions Alpha The excess return of a portfolio adjusted for it s market risk measured by beta. A positive alpha indicates that the fund generated returns from other sources than taking market risk. = return i r f β return b r f With a beta of 1, investment return of 12% and benchmark return of 10%, an alpha of 2% indicates a fund performance 2% excess of the benchmark with full market exposure. Beta Beta is a measure of systematic risk arising from exposure to the market represented by a benchmark. β = ρ i,b σ i σ b A beta of 1.2 means that an investments perfectly correlated with the market (ρ i,b =1) returns/looses 20% more in up/down markets respectively. Tracking error The tracking error measures the standard deviation of active returns of a portfolio. It is a measure to express how much risk a manager takes by deviating from the benchmark. tracking error = σ returni return b A tracking error of 4.0 indicates that the active returns of investment relative to the benchmark have exhibited a volatility of 4%. Active share Active share measures the percentage of holdings in an investment fund which differ from the fund s benchmark. Active share N = 1 w 2 i,n w b,n n=1 Comparing a hypothetical portfolio and benchmark, both consisting of separate single stocks, would yield an active share of 100%: ½( 100%-0% + 0%-100% )=100% Maximum drawdown The percentage value an investor would loose if they invested for the most unfavorable period possible. Maximum drawdown = max t 0,T max t 0,τ X t X τ max X t t 0,T Maximum drawdown Source: Invesco, Morningstar as of March 31st, Subscripts i, b and rf stand for investment (e.g. fund), benchmark and risk-free rate respectively. 37

38 Appendix Definitions Sharpe ratio The Sharpe ratio is the average return in excess of the risk free rate per unit of risk measured by volatility. Sharpe ratio = return i return rf σ i With a Sharpe ratio of 1.2, a fund has returned 1.2% p.a. over the risk-free rate per unit of volatility of the fund s returns. Sortino ratio The Sortino ratio measures the portfolio returns per unit of downside deviation (below-target semi-deviation). Therefore this ratio only penalizes bad volatility; the volatility of negative returns. Sortino ratio = return i return rf downside deviation i A Sortino ratio of 1.2, indicates a fund that has returned 1.2% p.a. over the risk-free rate per unit of volatility of the fund s negative returns. Information ratio The information ratio is a measure of risk-adjusted returns which relates excess returns to a portfolios deviation from the benchmark, measured through the tracking error. Information ratio = return i return b tracking error i With an information ratio of 0.6 a fund has returned excess returns of 0.6% p.a. per unit of tracking error. Up/down capture ratio The up/down capture ratio measure how much of upward/ downward market movements a portfolio has captured. Up/down capture ratio = return i return b x100 An up capture ratio of 120% indicates a fund performance of 1.2 times the benchmark return in up market phases. Overall capture ratio The overall capture ratio is the quotient of the up and down capture ratio. Overall capture ratio = Up capture ratio Down capture ratio If a fund exhibited an overall capture ratio above 1, its up market participation was higher than its down market participation. Source: Invesco, Morningstar as of March 31st, Subscripts i, b, rf and (up/down) stand for investment (e.g. fund), benchmark, risk-free rate and up/down markets respectively. 38

39 Peer Group Percentile Appendix Peer groups and ranking systematic Peer Group Graph st quartile 1 st to 25 th %tile 2 nd quartile 26 th to 50 th %tile 3 rd quartile 51 st to 75 th %tile 4 th quartile 75 th to 100 th %tile 1st decile 1 st to 10th %tile 2 nd decile 11 th to 20 th %tile 3 rd decile 21 st to 30 th %tile 4 th decile 31 st to 40 th %tile 5 th decile 41 st to 50 th %tile 6 th decile 51 st to 60 th %tile 7 th decile 61 st to 70 th %tile 8 th decile 71 st to 80 th %tile 9 th decile 81 st to 90 th %tile 10 th decile 91 st to 100 th %tile Morningstar assigns GIF sectors to Cross Border Funds according to their investment objectives and asset allocation All funds in a specific GIF sector with a comparable distribution space are a peer group In order to put an individual fund s performance into context it can be compared to peer group performance In addition to a comparison to the peer group average, peers can be ranked and divided into quartiles, deciles or percentiles The peer group can be divided into quartiles with the following percentile breakpoints: 5% 1, 25%, 50%, 75%, 95% 1 Source: Invesco, Morningstar as of March 31 st, Most graphs used in this presentation do not include percentiles 1-5 and in order to avoid outliers. 39

40 Appendix Peer groups and ranking example Example investment growth Example: Hypothetical peer group (167 funds) Fund rank: 20 Percentile: 12 th Quartile: 1 st Fund investment growth ranked 20th in peer group, therefore it is in the 12th percentile as well as first quartile as of June Index investment growth ranked 88th, which puts it in the 53rd percentile and 3rd quartile Index rank: 88 Percentile: 53 rd Quartile: 3 rd 04/ / /2017 4th quartile 3rd quartile 2nd quartile 1st quartile Fund Index Peer group ranking systematic Example: Hypothetical peer group with 167 funds Color Quartile Highest rank Lowest rank 1 st quartile 9 th 41 st 2 nd quartile 42 nd 83 rd 3 rd quartile 84 th 125 th 4 th quartile 126 th 158 th Source: Invesco, Morningstar as of March 31st,

41 Risk Warnings 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. Debt instruments are exposed to credit risk which is the ability of the borrower to repay the interest and capital on the redemption date. Changes in interest rates will result in fluctuations in the value of the fund. The fund uses derivatives (complex instruments) for investment purposes, which may result in the Fund being significantly leveraged and may result in large fluctuations in the value of the fund. 41

42 Important Information This marketing document is exclusively for use by Professional Clients and Financial Advisers in Continental Europe (as defined below) and Ireland, Qualified Investors in Switzerland and Professional Clients in Cyprus, Isle of Man and the UK. This document may also be used by financial intermediaries in the United States as defined below. By accepting this document, you consent to communicate with us in English, unless you inform us otherwise. This document is not for consumer use, please do not redistribute. Data as at , unless otherwise stated. This document is marketing material and is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell securities. Where individuals or the business have expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice. For more information on our funds, please refer to the most up to date relevant fund and share class-specific Key Investor Information Documents, the latest Annual or Interim Reports and the latest Prospectus, and constituent documents. This information is available using the contact details of the issuer and is without charge. Further information on our products is available in English using the contact details shown. This marketing document is not an invitation to subscribe for shares in the fund and is by way of information only, it should not be considered financial advice. This does not constitute an offer or solicitation by anyone in any jurisdiction in which such an offer is not authorised or to any person to whom it is unlawful to make such an offer or solicitation. Persons interested in acquiring the fund should inform themselves as to (i) the legal requirements in the countries of their nationality, residence, ordinary residence or domicile; (ii) any foreign exchange controls and (iii) any relevant tax consequences. As with all investments, there are associated risks. This document is by way of information only. Asset management services are provided by Invesco in accordance with appropriate local legislation and regulations. The fund is available only in jurisdictions where its promotion and sale is permitted. Not all share classes of this fund may be available for public sale in all jurisdictions and not all share classes are the same nor do they necessarily suit every investor. Fee structure and minimum investment levels may vary dependent on share class chosen. Please check the most recent version of the fund prospectus in relation to the criteria for the individual share classes and contact your local Invesco office for full details of the fund registration status in your jurisdiction.please be advised that the information provided in this document is referring to Class A ( accumulation - EUR) exclusively. This fund is domiciled in Luxembourg. For the distribution of this document, Continental Europe is defined as Austria, Belgium, Finland, France, Germany, Greece, Italy, Liechtenstein, Luxembourg, Netherlands, Norway, Spain and Sweden. Germany, Austria, Switzerland and Liechtenstein: This document is issued in Germany by Invesco Asset Management Deutschland GmbH. This document is issued in Austria by Invesco Asset Management Österreich Zweigniederlassung der Invesco Asset Management Deutschland GmbH, and in Switzerland as well as Liechtenstein by Invesco Asset Management (Schweiz) AG. Subscriptions of shares are only accepted on the basis of the most up to date legal offering documents. The legal offering documents (fund & share class specific Key Investor Information Document, prospectus, annual & semi-annual reports, articles and trustee deed) are available free of charge at our website and in hardcopy and local language from the issuers: Invesco Asset Management Deutschland GmbH, An der Welle 5, D Frankfurt am Main, Invesco Asset Management Österreich Zweigniederlassung der Invesco Asset Management Deutschland GmbH, Rotenturmstrasse 16-18, A-1010 Wien, and Invesco Asset Management (Schweiz) AG, Talacker 34, CH-8001 Zurich, who acts as a representative for the funds distributed in Switzerland. In Liechtenstein the KIID and Prospectus are available in German and English on respectively. Paying agent in Switzerland: BNP PARIBAS SECURITIES SERVICES, Paris, succursale de Zurich, Selnaustrasse 16, CH-8002 Zürich. Paying agent in Liechtenstein: LGT Bank AG, Herrengasse 12, FL-9490 Vaduz. Belgium, Finland, France, Greece, Italy, Luxembourg, Netherlands, Norway, Spain, Sweden: This document is issued by Invesco Asset ManagementS.A., rue de Londres, Paris, France. Ireland: Issued by Invesco Global Asset Management DAC, Central Quay, Riverside IV, Sir John Rogerson s Quay, Dublin 2, Ireland. Regulated in Ireland by the Central Bank of Ireland. Cyprus: Issued by Invesco Asset Management S.A. 18, rue de Londres, F Paris. Authorised and regulated by the Autorité des marchés financiers in France. Any scheme provided by the Cyprus regulatory system, for the protection of retail clients, does not apply to offshore investments. Compensation under any such scheme will not be available.the Invesco Euro Short Term Bond Fund is subject to the provisions of the European Directive 2009/65/EC. Isle of Man: Issued by Invesco Global Asset Management DAC, Central Quay, Riverside IV, Sir John Rogerson s Quay, Dublin 2, Ireland. Regulated in Ireland by the Central Bank of Ireland. The Invesco Euro Short Term Bond Fund is an unregulated scheme that cannot be promoted to retail clients in the Isle of Man. The participants in the scheme will not be protected by any statutory compensation scheme. UK: Issued by Invesco Fund Managers Limited, Perpetual Park, Perpetual Park Drive, Henley-on-Thames, Oxfordshire RG9 1HH, UK. Authorised and regulated by the Financial Conduct Authority. For the purposes of UK law, the fund is a recognised scheme under section 264 of the Financial Services & Markets Act The protections provided by the UK regulatory system, for the protection of Retail Clients, do not apply to offshore investments. Additional information for financial intermediaries in the United States: This document is intended for distribution to US financial intermediaries for informational purposes and in relation to their activities with offshore clients only. The Funds are not registered under any US securities law, and may not be offered or sold directly or indirectly in the US, its territories or possessions, nor to any US persons, citizens or residents. The Fund must not be marketed on US soil. This does not constitute a recommendation of any investment strategy or product for a particular investor. Investors should consult a financial professional before making any investment decisions. Issued in the US by Invesco Distributors, Inc., 11 Greenway Plaza, Suite 1000, Houston, Texas 77046, USA. Invesco Distributors, Inc. is the appointed US sub-distributor of the Invesco Funds SICAV and Invesco Fund Series 1-6. All entities are indirect, wholly owned subsidiaries of Invesco Ltd. 42