Description

This Invesco ETF seeks to replicate the net total return performance of the JPX-Nikkei 400 EUR Hedged Index, referred to as the "Reference Index," after accounting for associated fees. The reference index offers diversified exposure to 400 companies listed on the Tokyo Stock Exchange, encompassing large-cap, small-cap, growth-oriented, and innovative sectors. Its selection methodology emphasizes companies demonstrating significant potential for generating shareholder value. Jointly developed by Nikkei and the Japan Exchange Group, the index's components are selected using rigorous criteria, including company size, return on equity, operating profitability, and robust corporate governance standards. A monthly currency hedge is embedded within the index's calculation to mitigate the effects of exchange rate volatility between the Japanese Yen and the Euro. The fund pursues its investment objective primarily through holding a basket of equities, which, though not identical to the index's constituents, is expected to deliver the majority of the fund's performance. Furthermore, it utilizes unfunded swap agreements with approved counterparties to reconcile any performance disparity between its equity holdings and the reference index. This hybrid approach aims to achieve a more precise and stable tracking performance than could typically be attained through solely physical replication. Operating under a passive management strategy, this ETF means investors acquire units in an index-tracking fund, rather than direct ownership of its underlying assets.