Description

The Invesco Materials S&P US Select Sector UCITS ETF Acc (XLBS.L) aims to deliver the net total return performance of its benchmark, the S&P Select Sector Capped 20% Materials Index (referred to as the "Reference Index"), after accounting for associated fees. This Reference Index focuses specifically on companies within the materials sector of the broader S&P 500 Index. Individual constituents are weighted based on their float-adjusted market capitalization, with each stock subject to a 19% cap. Any weight exceeding this threshold is redistributed proportionally among the remaining uncapped constituents. To achieve its objective, the fund primarily invests in a portfolio of equities. While these holdings typically generate the majority of the fund's returns, they generally do not precisely mirror the exact constituents of the Reference Index. The fund also utilizes unfunded swaps, which are agreements with approved counterparties. These swaps facilitate the exchange of any difference between the returns of the Reference Index and the fund's equity basket. This strategy is employed to secure a more precise and consistent tracking of the index than would typically be achievable through direct physical replication alone. It's important to note that while the fund's investment goal is to replicate the standard net total return index, its swaps are linked to an enhanced Withholding Tax (WHT) version of the index. Consequently, the ETF's performance before fees is anticipated to exceed the returns of the conventional net return index. This ETF is a passively managed, index-tracking fund. Investors acquire units in the fund itself, rather than gaining direct ownership of the underlying assets held within its portfolio.