Invesco DWA Tactical Sector Rotation ETF (DWTR)

Overview

The investment described aims to mirror the performance of the Dorsey Wright® Sector 4 Index, prior to accounting for fees and expenses. This objective is achieved by allocating at least 90% of its total assets to securities that form part of the said index. This fund adopts a "fund of funds" strategy, signifying that it primarily invests in other exchange-traded funds (ETFs) that are considered for inclusion in the underlying index. The underlying index itself is designed to identify and invest in sectors of the U.S. equity market showing the highest relative strength, an evaluation conducted monthly. Notably, this fund is classified as non-diversified, suggesting a concentrated investment strategy in the chosen ETFs and sectors.

Products and Services

• Investment Tracking

  The fund's principal service is its investment strategy to track the outcomes of the Dorsey Wright® Sector 4 Index. This is accomplished through careful selection and investment in securities and ETFs that reflect the performance and composition of the underlying index. The goal here is to provide investors with a passive investment option that closely follows the chosen market segment's performance.

• "Fund of Funds" Investment

  A distinct feature of this investment fund is its "fund of funds" approach. This means that instead of directly investing in stocks, bonds, or other securities, the fund invests in a collection of ETFs. These ETFs are selected based on their eligibility and potential to be included in the Dorsey Wright® Sector 4 Index, making it an indirect way for investors to gain exposure to the sectors of the U.S. equity market with strong relative strength.

• Monthly Evaluation of Sector Strength

  An innovative service aspect of the fund is its methodology for sector selection. The underlying index it tracks employs a monthly assessment to identify sectors within the U.S. equity market showcasing the strongest relative strength. This continuous evaluation ensures that the fund's investments are always aligned with the most dynamically performing sectors, potentially leading to better investment outcomes.

• Non-Diversified Fund Structure

  The non-diversified status of the fund indicates a focused investment approach. Unlike diversified funds, which spread their investments over a wide range of assets to mitigate risks, this fund concentrates its investments in a smaller number of ETFs. This strategy is based on the belief that investing in sectors showing strong relative strength can yield better returns, despite the potentially higher risk due to less diversification.