Description

The Invesco USD IG Corporate Bond ESG Climate Transition UCITS ETF Dist aims to provide the total return performance of the Bloomberg MSCI USD Liquid Corporate Climate Transition ESG Bond Index (CTB) (the "Reference Index"), less the impact of fees. The fund distributes income on a quarterly basis. The Reference Index is designed to reflect the performance of USD-denominated investment grade, fixed-rate, taxable debt securities issued by corporate issuers adjusted based upon certain environmental, social and governance (“ESG”) metrics and including a decarbonisation pathway aligned with the Climate Transition Benchmark ("CTB") requirements. Bonds must have USD 1 billion minimum par amount outstanding or USD 500 million in the case of securities issued by utilities.Securities are excluded that, according to the index provider's exclusionary criteria: 1) have an MSCI ESG rating below BB; 2) have faced very severe controversies pertaining to ESG issues (including UN Global Compact violations) or severe controversies pertaining to environmental issues over the last three years; 3) are issued by an issuer that is not covered by all relevant MSCI ESG Research; 4) are involved, as per the standard Bloomberg MSCI SRI methodology, in any of the following business activities: alcohol, adult entertainment, controversial weapons, conventional weapons, gambling, fossil fuels, GMOs, firearms, nuclear weapons, nuclear power, oil sands, thermal coal (including hard coal and lignite), tobacco, unconventional oil and gas; or 5) are issued by emerging market issuers.The Reference Index then applies an optimisation approach to re-weight remaining eligible securities with a view to minimise the difference in constituent weights, sector weights and industry weights to the Bloomberg USD Corporate Index (the "Parent Index"), while achieving: 1) alignment with the minimum standards for EU Climate Transition Benchmarks; and 2) an uplift in MSCI ESG Score against the Parent Index. The above optimisation is subject to diversification constraints, the details of which can be found in the Reference Index methodology.The portfolio managers aim to achieve the fund’s objective by using portfolio modelling tools and techniques to buy and hold a proportion of the index securities that represents the characteristics of the entire index. The objective of this sampling method is to replicate the index performance as closely as possible while reducing the costs that would normally be incurred with full replication. This ETF is passively managed. An investment in this fund is an acquisition of units in a passively managed, index tracking fund rather than in the underlying assets owned by the fund.