Our ETF suite just got sweeter with our Income Advantage ETFs
Inspired by QQQ and RSP, our two new ETFs have added features designed to provide consistent income.
Investors want certain income in an uncertain world
The path of interest rates is unclear, leaving investors unsure whether traditional sources of income can meet their needs.
In the midst of uncertainty, investors are seeking reliable income as well as the growth potential of equities.
QQA
Invesco QQQ Income Advantage ETF
The latest addition to the QQQ Innovation Suite: Income
Like QQQ, QQA tracks the Nasdaq-100® Index, but it’s also designed to provide consistent monthly income and maintain growth potential — all with less volatility and downside risk mitigation.
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Built to provide consistent monthly income
QQA strives to provide a high and consistent yield from premiums collected from an option income overlay, dividends from stocks in the Nasdaq-100 Index, and interest income.
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Invest in innovative companies
QQA delivers exposure to Nasdaq-100® companies at the forefront of transformative, long-term innovations such as augmented reality, cloud computing, big data, mobile payments, streaming services, electric vehicles, and more.
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RSPA
Invesco S&P 500 Equal Weight Income Advantage ETF
Equal weight with an added advantage: Income
Like RSP, RSPA tracks the S&P 500 Equal Weight Index, but it’s also designed to provide consistent monthly income and maintain growth potential —all with less volatility and downside risk mitigation.
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Built to provide consistent monthly income
RSPA strives to provide a high and consistent yield from premiums collected from an option income overlay, dividends from stocks in the S&P 500 Equal Weight Index, and interest income.
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Equal exposure to all the market’s possibilities
RSPA invests equally in all 500 stocks of the S&P 500 Index. This classic strategy for eliminating market concentration means you’re never underexposed to the market’s possibilities.
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Frequently asked questions
An option is a financial instrument that gives the option holder the right, but not the obligation, to buy or sell a set quantity or dollar value of a particular asset at a fixed price by a certain date. Options are a useful instrument for generating income outside of more traditional means, like collecting dividends on stocks or interest on bonds.
When an investor sells an option, they’re giving the buyer the ability to buy or sell a specific asset by a certain date at a predetermined price. In return, the seller collects an option premium from the buyer, which is considered income. Option income strategies can be an effective way of generating a steady stream of monthly income while maintaining exposure to equities.
The income generated from options has a different set of sensitivities and drivers than income from bonds or dividend-paying stocks. For example, traditional bond exposures have interest rate risk. Equity options avoid interest rate risk. Instead, the yield from selling equity options is impacted by the implied equity market volatility. When equity market volatility is high, option premiums will increase and push the yields higher.
Invesco QQQ is one of the most actively traded securities, with a history dating back to 1999. QQQ tracks the Nasdaq-100 index, which includes companies at the forefront of many long-term innovative themes shaping today’s economy. For more information on how innovation may help drive the performance of Invesco QQQ, click here.
Source: Bloomberg L.P., QQQ is the 2nd most-traded ETF in the US based on average daily volume traded, as of June 30, 2024.
Option income strategies can be designed in a number of different ways. In the case of QQA and RSPA, we use equity-linked notes to efficiently execute a tailored option income strategy designed to generate a steady income stream for investors. We partner with several reputable global banks who execute our customized option strategy.
Invesco has deep expertise in managing ETFs. QQQ launched in 1999 establishing the standard for investing in innovation. Over 20 years ago, RSP helped reinvent how clients access the S&P 500. And we’ve managed option overlay strategies for multi-asset portfolios since 2018.
Want more income ideas? We have a world of options
The Invesco MSCI EAFE Income Advantage ETF (EFAA) provides exposure to international stocks through the MSCI EAFE Index as well as an income-generating options overlay. EFAA may help you diversify internationally while targeting income, less volatility, and downside risk protection.
Take advantage of no fee through June 30, 20251
Footnotes
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Effective July 17, 2024 through June 30, 2025, Invesco Capital Management LLC (the “Adviser”) will voluntarily waive 100% of its management fee, 0.29% for QQA and RSPA and 0.39% for EFAA. The Net Expense Ratio for the funds through June 30, 2025 is 0.00%.
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Click here for a QQA prospectus. Click here for a RSPA prospectus. Please read both carefully.
About risk
QQQ and RSP
There are risks involved with investing in ETFs, including possible loss of money. Shares are not actively managed and are subject to risks similar to those of stocks, including those regarding short selling and margin maintenance requirements. Ordinary brokerage commissions apply. The Fund's return may not match the return of the Underlying Index. The Fund is subject to certain other risks. Please see the current prospectus for more information regarding the risk associated with an investment in the Fund.
QQQ
Investments focused in a particular sector, such as technology, are subject to greater risk, and are more greatly impacted by market volatility, than more diversified investments.
The NASDAQ Composite Index measures all NASDAQ domestic and international-based common stocks listed on The Nasdaq Stock Market. The Russell 3000® Index is an unmanaged considered representative of the U.S. stock market. The Russell 3000® Index is a trademark/service mark of the Frank Russell Co. Russell® is a trademark of the Frank Russell Co.
The sponsor of the Nasdaq-100 TrustSM, a unit investment trust, is Invesco Capital Management LLC (Invesco). NASDAQ, Nasdaq-100 Index, Nasdaq-100 Index Tracking Stock and QQQ are trade/service marks of The Nasdaq Stock Market, Inc. and have been licensed for use by Invesco, QQQ's sponsor. NASDAQ makes no representation regarding the advisability of investing in QQQ and makes no warranty and bears no liability with respect to QQQ, the Nasdaq-100 Index, its use or any data included therein.
RSP
Investments focused in a particular industry or sector, are subject to greater risk, and are more greatly impacted by market volatility, than more diversified investments.
Stocks of medium-sized companies tend to be more vulnerable to adverse developments, may be more volatile, and may be illiquid or restricted as to resale.
The Global Industry Classification Standard was developed by and is the exclusive property and a service mark of MSCI, Inc. and Standard & Poor's.
"Standard & Poor’s," "S&P" and "S&P 500," are trademarks of Standard & Poor’s Financial Services, LLC and have been licensed for use by Invesco Capital Management LLC and its affiliates. Invesco S&P 500® Equal Weight ETF is not sponsored, endorsed, sold or promoted by Standard & Poor’s makes no representation regarding the advisability of investing in Invesco S&P 500® Equal Weight ETF.
QQA, RSPA, and EFAA
There are risks involved with investing in ETFs, including possible loss of money. Actively managed ETFs do not necessarily seek to replicate the performance of a specified index. Actively managed ETFs are subject to risks similar to stocks, including those related to short selling and margin maintenance. Ordinary brokerage commissions apply. The Fund’s return may not match the return of the Index. The Fund is subject to certain other risks. Please see the current prospectus for more information regarding the risk associated with an investment in the Fund.
Securities held by the Fund are subject to market fluctuations. You should anticipate that the value of the Shares will decline, more or less, in correlation with any decline in value of the securities in the Fund’s portfolio. Additionally, natural or environmental disasters, widespread disease or other public health issues, war, military conflicts, acts of terrorism, economic crises or other events could result in increased premiums or discounts to the Fund’s net asset value (“NAV”).
The investment techniques and risk analysis used by the portfolio managers may not produce the desired results.
While the Fund is actively managed, a substantial portion of the Fund’s portfolio is designed to track the performance of the Index. In managing this portion of the Fund’s portfolio, the portfolio managers will not generally buy or sell a security unless that security is added or removed, respectively, from the Index, regardless of the performance of that security. If a specific security is removed from the Index, the Fund may be forced to sell such security at an inopportune time or for a price lower than the security’s current market value.
In general, equity values fluctuate, sometimes widely, in response to activities specific to the company as well as general market, economic and political conditions.
Investments in ELNs are susceptible to the risks of their underlying instruments, which could include management risk, market risk and, as applicable, foreign securities and currency risks. ELNs are also subject to certain debt securities risks, such as interest rate and credit risks. Should the prices of the underlying instruments move in an unexpected manner, the Fund may not achieve the anticipated benefits of an investment in an ELN, and may realize losses, which could be significant and could include the Fund’s entire principal investment. An ELN investment is also subject to counterparty risk, which is the risk that the issuer of the ELN will default or become bankrupt and the Fund may not be repaid the principal amount of, or income from, its investment. ELNs may also be less liquid than more traditional investments and the Fund may be unable to sell ELNs at a desirable time or price. In addition, the price of ELNs may not correlate with the underlying securities or a fixed income investment.
Investments focused in a particular industry are subject to greater risk, and are more greatly impacted by market volatility, than more diversified investments.
Derivatives may be more volatile and less liquid than traditional investments and are subject to market, interest rate, credit, leverage, counterparty and management risks. An investment in a derivative could lose more than the cash amount invested.
Risks of futures contracts include: an imperfect correlation between the value of the futures contract and the underlying commodity; possible lack of a liquid secondary market; inability to close a futures contract when desired; losses due to unanticipated market movements; obligation for the Fund to make daily cash payments to maintain its required margin; failure to close a position may result in the Fund receiving an illiquid commodity; and unfavorable execution prices.
A decision as to whether, when and how to use options involves the exercise of skill and judgment and even a well conceived option transaction may be unsuccessful because of market behavior or unexpected events. The prices of options can be highly volatile and the use of options can lower total returns.
Short sales may cause an investor to repurchase a security at a higher price, causing a loss. As there is no limit on how much the price of the security can increase, exposure to potential loss is unlimited.
The Fund is non-diversified and may experience greater volatility than a more diversified investment.
The value of an individual security or particular type of security may be more volatile than the market as a whole and may perform differently from the value of the market as a whole.
The Fund currently intends to effect creations and redemptions principally for cash, rather than principally in-kind because of the nature of the Fund’s investments. As such, investments in the Fund may be less tax efficient than investments in ETFs that create and redeem in-kind.
The Fund is subject to numerous market trading risks, including the potential lack of an active market, losses from trading in secondary markets, and disruption in the creation/redemption process. During stressed market conditions, Shares may become less liquid as result of deteriorating liquidity which could lead to differences in the market price and the underlying value of those Shares.
QQA
Investments focused in a particular sector, such as information technology, are subject to greater risk, and are more greatly impacted by market volatility, than more diversified investments.
RSPA
Because the Fund may invest in other investment companies, it’s subject to the risks associated with the investment company and its investment performance may depend on the underlying investment company’s performance. The Fund will indirectly pay a proportional share of the investment company’s fees and expenses, while continuing to pay its own management fee to the Adviser, resulting in shareholders absorbing duplicate levels of fees.
EFAA
The risks of investing in securities of foreign issuers can include fluctuations in foreign currencies, political and economic instability, and foreign taxation issues.
The performance of an investment concentrated in issuers of a certain region or country is expected to be closely tied to conditions within that region and to be more volatile than more geographically diversified investments.
ADRs and GDRs may be subject to certain of the risks associated with direct investments in the securities of foreign companies. ADRs and GDRs may not track the price of the underlying securities on which they are based, and their value may change materially at times when U.S. markets are not open for trading.
Currencies and futures generally are volatile and are not suitable for all investors.
Because the Fund may invest in other investment companies, it’s subject to the risks associated with the investment company and its investment performance may depend on the underlying investment company’s performance. The Fund will indirectly pay a proportional share of the investment company’s fees and expenses, while continuing to pay its own management fee to the Adviser, resulting in shareholders absorbing duplicate levels of fees.